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EXHIBIT 10.5
SUBLEASE AGREEMENT
This SUBLEASE AGREEMENT ("Sublease") is made as of the ____ day of
April, 1998, among XXXXXX CORPORATION, a Delaware corporation ("Sublessor") and
OMEGA PROTEIN CORPORATION, a Nevada corporation ("Subtenant").
R E C I T A L S:
A. By Lease Agreement, dated June 30, 1995 (as previously and hereafter
amended from time to time, the "Primary Lease"), by and between Sublessor and
Patriot Saint Xxxxx I Investors, L.P., a Delaware limited partnership
("Landlord"), Landlord leased to Sublessor approximately 10,245 square feet at
0000 Xx. Xxxxx Xxxxx Xxxxxxx, Xxxxxx Xxxxxx, Xxxxx (the "Demised Premises"),
which, pursuant to an amendment, has been reduced to 6,707 square feet.
B. Sublessor and Subtenant desire that Sublessor sublease to Subtenant
approximately 3,350 rentable square feet of Demised Premises ("Subleased
Premises").
P R O V I S I O N S:
In consideration of the Recitals, the covenants set forth herein and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, Sublessor and Subtenant hereby agree as follows:
ARTICLE 1
SUBLEASE OF SUBLEASED PREMISES
1.1 SUBLEASED PREMISES. Sublessor, in consideration of the rents,
covenants, agreements and conditions herein set forth which Subtenant hereby
agrees shall be paid, kept and performed, does hereby sublease unto Subtenant,
and Subtenant does hereby rent and sublease from Sublessor, the Subleased
Premises, subject to all encumbrances and other matters affecting the Subleased
Premises.
1.2 HABENDUM CLAUSE. To have and to hold the Subleased Premises,
together with all and singular the rights and privileges appurtenant thereunto
attaching or in anywise belonging, exclusively unto Subtenant and its successors
and assigns (to the extent permitted herein), for the term set forth in Article
2 hereof, subject to termination as herein provided and all encumbrances and
other matters affecting the Subleased Premises and subject to and upon the
covenants, agreements, terms, provisions and limitations herein set forth.
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ARTICLE 2
TERM
The term of this Sublease shall commence on the date of the Closing of
Subtenant's initial public offering of its common stock. The date upon which the
term of this Sublease commences shall be herein called the "Commencement Date."
This Sublease shall terminate, unless sooner terminated pursuant to the
provisions hereof, on the earlier of (i) termination of the Primary Lease
(unless such termination was caused by a default by Subtenant under this
Sublease) or (ii) termination of Sublessor's right to possession of the Demised
Premises under the Primary Lease (unless such termination was caused by a
default by Subtenant under this Sublease).
ARTICLE 3
RENT
The rent for the Subleased Premises shall be payable in advance on the
Commencement Date and on the first day of each month thereafter throughout the
term of this Sublease. Each monthly installment shall be in the amount of the
Sublessor's total monthly rental payments under the Primary Lease multiplied by
a fraction, the numerator of which is the square footage within the Subleased
Premises and the denominator of which is the total square footage of the Demised
Premises under the Primary Lease. Such rent shall include any and all
adjustments and escalation payments Sublessor is obligated to pay under the
Primary Lease. All unpaid rent under the Sublease shall be due upon termination
of this Sublease. The rent payable hereunder shall be payable to Sublessor,
without notice or demand and without deduction, abatement or setoff, in lawful
money of the United States, at the address of Sublessor set forth in the notice
provision of this Sublease. If the Commencement Date or the last date of the
term of this Sublease should be on any day other than the first or last date of
a calendar month, respectively, then the rent for such month shall be made on a
pro rata basis for the part of such month included within the term of this
Sublease. All past due installments of rent shall bear interest at the rate
which applies to past due payments in the Primary Lease and be subject to a late
charges in the amount provided in the Primary Lease.
ARTICLE 4
ADDITIONAL EXPENSES; SERVICES; PARKING
4.1 ADDITIONAL EXPENSES. In addition to paying rent as set forth in
Article 3, Subtenant shall pay its pro rata share of any additional costs and
expenses incurred by Sublessor under the Primary Lease or otherwise relating to
the Demised Premises as a whole, and shall pay all of any additional costs and
expenses (such as overtime air conditioning or heat) incurred by Sublessor with
respect to the Subleased Premises. Any such sums shall be due within five (5)
days of the date of an invoice therefor submitted by the Sublessor to Subtenant.
4.2 PHONE SYSTEM. Subtenant currently utilizes Sublessor's telephone
system and related equipment. During the Term, Subtenant shall be permitted to
continue to use such
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phone system and related equipment and shall pay Sublessor therefor with each
rent payment hereunder a monthly fee equal to fifty percent (50%) of the costs
incurred by the Sublessor to own, lease and/or operate such phone system payable
with each rent payment hereunder. Such equipment shall remain the property of
Sublessor, and shall be returned to Sublessor upon termination of this Sublease.
In the event Subtenant requires additional phone equipment during the Term, such
equipment shall be acquired directly by Subtenant at Subtenant's cost, which
additional equipment shall be the property of Subtenant. Subtenant shall pay,
within five (5) days of invoice, all long distance charges incurred by Subtenant
billed to Sublessor, and Subtenant's pro rata share, based on the number of
phone extensions allocated to Sublessor, of local phone charges billed to
Sublessor.
4.3 PARKING. Subtenant shall be entitled to the use of one-half of the
reserved parking spaces assigned to the Demised Premises. Subtenant shall not be
required to pay any additional fees for the use of such parking spaces.
ARTICLE 5
USE OF PREMISES; CONSTRUCTION OF IMPROVEMENTS
5.1 USE OF SUBLEASED PREMISES AND COMMON AREAS. The Subleased Premises
shall be used by Subtenant solely for office space and for no other purposes.
Subtenant will not suffer or permit the use of the Subleased Premises, or any
part thereof, in any manner that would violate any provision of the Primary
Lease. Subtenant agrees that its use of any common areas in or about the
building will not interfere with Sublessor's use thereof, and that Subtenant
will not do or permit to be done any act which would prohibit or hinder
Sublessor's use thereof.
5.2 CONSTRUCTION OF IMPROVEMENTS. Subtenant shall make no alterations,
installations, additions or improvements in or to the Subleased Premises without
the prior written consent of Sublessor and, if required under the Primary Lease,
the Landlord. Any such alterations, installations,additions or improvements
shall be made at Subtenant's sole cost and expense, must be made in compliance
with the terms of the Primary Leases, and may only be made by persons authorized
pursuant to the terms of the Primary Leases. The removal of such alterations,
installations, additions or improvements upon termination of this Sublease shall
be governed by the provisions of Article 10 of this Sublease.
ARTICLE 6
ASSUMPTION AGREEMENT AND COVENANTS
6.1 OBSERVANCE OF PRIMARY LEASE PROVISIONS. The Subtenant agrees with
Sublessor to fully and timely observe all of the provisions of the Primary Lease
respecting the Subleased Premises which are to be observed during the term
hereof by the Sublessor as tenant under the Primary Lease. None of the rights,
titles or interests of Sublessor under the Primary Leases are assigned to
Subtenant.
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6.2 SUPERIOR MATTERS. This Sublease, and all of Subtenant's rights and
estates hereunder, are and shall always be subject and subordinated to the
Primary Lease and all encumbrances and other matters affecting the building in
which the Demised Premises is situated and the land on which such building is
located. Subtenant acknowledges that it is familiar with the provisions of the
Primary Lease.
ARTICLE 7
LIMITATION OF LIABILITY AND INDEMNITY
7.1 INDEMNITY. Except for injury to any person, or damage to the
property of any person, proximately caused by the Sublessor or agents or
employees of Sublessor, Subtenant shall indemnify and save Sublessor and its
agents and employees harmless from and against all claims (including attorneys'
fees and court costs) arising from any act or omission of Subtenant or
Subtenant's agents, employees or contractors, or arising from any injury to any
person or damage to the property of any person occurring during the term of this
Sublease in or about the Demised Premises, including the Subleased Premises.
Subtenant agrees to use and occupy the Subleased Premises at its own risk and
hereby releases Sublessor, and agents or employees of Sublessor from all claims
for any damage or injury to the full extent permitted by law, unless such damage
or injury is proximately caused by the Sublessor or the agents or employees of
Sublessor.
7.2 INSURANCE. Subtenant shall secure and maintain in force
comprehensive general liability insurance, including contractual liability
specifically applying to the provisions of this Sublease and completed
operations liability for reasonable and appropriate limits with respect to
bodily injury or death to any number of persons in any one accident or
occurrence and with respect to property damage in any one accident or
occurrence. All insurance maintained in accordance with the provisions of this
Section 7.2 shall be issued by reputable insurance companies. If Subtenant fails
to maintain such insurance, Sublessor, at its election but without obligation to
do so, may procure such insurance as may be necessary to comply with these
requirements, and Subtenant agrees to repay the cost of same to Sublessor on
demand, with interest thereon at the maximum rate permitted by law from the date
of expenditure until paid.
7.3 CASUALTY OR CONDEMNATION. If the Subleased Premises are damaged by
fire or other casualty or are condemned or taken in any manner for a public use,
and this Sublease and the Primary Lease are not terminated as a result of such
occurrence, it shall be solely the obligation of Landlord pursuant to the terms
of the Primary Lease, and not of Sublessor, to repair, restore or rebuild the
Subleased Premises, and Subtenant shall not be entitled to any award for any
such condemnation.
ARTICLE 8
CONDITION OF SUBLEASED PREMISES
Subtenant shall accept possession of the Subleased Premises, and the
fixtures and appurtenances therein, on the Commencement Date in its then present
condition. Accordingly, Sublessor shall have no obligation what so ever to make
or construct any
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improvements within the Subleased Premises. Subtenant shall maintain the
Subleased Premises, and the fixtures and appurtenances therein, in good order,
repair and condition at all times.
ARTICLE 9
[INTENTIONALLY OMITTED]
ARTICLE 10
FURNITURE AND FIXTURES
Subtenant may from time to time, and shall at the termination of this
Sublease, remove its trade fixtures, office supplies and movable office
furniture and equipment not attached to the Subleased Premises provided: (a)
Subtenant is not in default of any obligation or covenant under this Sublease at
the time of such removal; and (b) Subtenant promptly repairs all damage caused
by such removal. All other property at the Subleased Premises and any
alteration, installation, addition or improvement in or to the Subleased
Premises (including wall-to-wall carpeting, paneling or other wall covering) and
any other article attached or affixed to the floor, walls or ceiling of the
Subleased Premises shall remain the property of Sublessor and shall remain upon
and be surrendered with the Subleased Premises as part thereof at the
termination of this Sublease (or at the termination of Subtenant's right to
possession of the Subleased Premises), Subtenant hereby waiving all rights to
any payment or compensation therefor.
ARTICLE 11
EVENTS OF DEFAULT AND REMEDIES
11.1 EVENTS OF DEFAULT. Each of the following acts or omissions of
Subtenant or occurrences shall constitute an "Event of Default":
(a) Failure by Subtenant to pay rent or any other sum payable
hereunder within ten (10) days after receiving written notice from the Sublessor
that such payment is past due hereunder;
(b) Failure to perform or observe any other covenant or
condition of this Sublease by Subtenant to be performed or observed within ten
(10) days after receiving written notice from Sublessor of its failure to
perform or observe any such covenant;
(c) Abandonment or vacating of the Subleased Premises or any
significant portion thereof;
(d) The filing or execution or occurrence of any of the
following; provided, however, in the case of any such filing or execution or
occurrence which is involuntary with respect to Subtenant, such filing or
execution or occurrence is not vacated within thirty (30)
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days after the occurrence thereof: a petition in bankruptcy or other insolvency
proceeding by or against Subtenant; or petition or answer seeking relief under
any provision of the United States Bankruptcy Code, or an assignment for the
benefit of creditors or composition, or a petition or other proceeding by or
against the Subtenant for the appointment of a trustee, receiver or liquidator
of Subtenant or any property of Subtenant or a proceeding by any government
authority for the dissolution or liquidation of Subtenant; or
(e) The termination or any occurrence giving rise to a right
of termination of any of the Primary Lease or termination of Sublessor's right
to possession or any occurrence giving rise to a right of termination of
possession of the Demised Premises under the Primary Lease caused (in whole or
in part) by the default of Subtenant under this Sublease.
11.2 REMEDIES. This Sublease and the term and estate hereby granted and
the demise hereby made are subject to the limitation that if and whenever any
Event of Default shall occur, and so long as such Event of Default remains
uncured, Sublessor may, at its option, in addition to all other rights and
remedies given hereunder or by law or equity, do either of the following:
(a) Terminate this Sublease, in which event Subtenant shall
immediately surrender possession of the Subleased Premises to Sublessor; or
(b) Enter upon and take possession of the Subleased Premises
and remove Subtenant and all other occupants therefrom, with or without having
terminated the Sublease.
11.3 LIABILITY OF SUBTENANT UPON TERMINATION.
(a) If Sublessor elects to terminate this Sublease by reason
of an Event of Default, then, notwithstanding such termination, Subtenant shall
be liable for and shall pay to Sublessor the sum of all rent and other
indebtedness accrued to the date of such termination, plus, as damages, an
amount equal to the then present value of the rent reserved hereunder for the
remaining portion of the term of this Sublease (had such term not been
terminated by Sublessor prior to the date of expiration stated in Article 2),
less the then present value of the fair rental value of the Subleased Premises
for such period. All present values shall be based on a three percent (3%) per
annum discount rate.
(b) If Sublessor elects to terminate this Sublease by reason
of an Event of Default, in lieu of exercising the rights of Sublessor under the
preceding subparagraph, Sublessor may instead hold Subtenant liable for all rent
and other indebtedness accrued to the date of such termination, plus such rent
and other indebtedness as would otherwise have been required to be paid by
Subtenant to Sublessor during the period following termination of the term of
this Sublease measured from the date of such termination by Sublessor until the
date of expiration stated in Article 2 (had Sublessor not elected to terminate
this Sublease on account of such Event of Default) diminished by any "Net
Sums"(as hereinafter defined) thereafter received by Sublessor through reletting
the Subleased Premises during said period. Actions to collect amounts due by
Subtenant provided for in this Section may be brought from
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time to time by Sublessor during the aforesaid period, on one or more occasions,
without the necessity of Sublessor's waiting until expiration of such period;
and in no event shall Subtenant be entitled to any excess of rent (or rent plus
other sums) obtained by reletting over and above the rent provided for in this
Sublease. As used herein, the term "Net Sums" refers to all rent, if
any,received by Sublessor through reletting the Subleased Premises following
termination of this Sublease or termination of Subtenant's right to possession
of the Subleased Premises, reduced by any expenses incurred by Sublessor as
provided in Section 11.5.
11.4 LIABILITY OF SUBTENANT UPON REPOSSESSION. If Sublessor elects to
repossess the Subleased Premises without terminating this Sublease,then
Subtenant shall be liable for and shall pay to Sublessor all rent and other
indebtedness accrued to the date of such repossession, plus rent required to be
paid by Subtenant to Sublessor during the remainder of the term of this Sublease
(had such term not been terminated by Sublessor prior to the date of expiration
stated in Article 2), diminished by any Net Sums there after received by
Sublessor through reletting the Subleased Premises during said period. In no
event shall Subtenant be entitled to any excess of any rent obtained by
reletting over and above the rent herein reserved. Actions to collect amounts
due by Subtenant as provided in this Section 11.5 may be brought from time to
time, on one or more occasions, without the necessity of Sublessor's waiting
until the expiration of the term of this Sublease.
11.5 ADDITIONAL OBLIGATIONS OF SUBTENANT UPON DEFAULT. In case of an
Event of Default, Subtenant shall also be liable for and shall pay to Sublessor,
in addition to any sum provided to be paid above, (a) broker's fees incurred by
Sublessor in connection with reletting the whole or any part of the Subleased
Premises; (b) the cost of removing and storing Subtenant's or other occupants'
property; (c) the cost of repairing the Subleased Premises into the condition
called for by the terms of this Sublease; and (d) all expenses incurred by
Sublessor in enforcing Sublessor's remedies, including reasonable attorneys'
fees.
11.6 SUBLESSOR'S RIGHT TO REMEDY DEFAULTS. If Subtenant should fail to
make any payment or cure any default hereunder within the time herein permitted,
Sublessor, without being under any obligation to do so and without thereby
waiving such default, may make such payment and/or remedy such other default for
the account of Subtenant (and enter the Subleased Premises for such purpose),
and thereupon Subtenant shall be obligated to, and hereby agrees to, pay
Sublessor, upon demand, all costs, expenses and disbursements (including
reasonable attorneys' fees) incurred by Sublessor in taking such remedial action
together with interest on all such sums at the highest non-usurious rate
permitted by law from the date of such demand until payment.
11.7 TENANT'S REMEDIES. In the event of any default by Sublessor,
Subtenant shall be entitled to bring an action for damages and/or for
declaratory or injunctive relief (in addition to any other relief or remedies
that it may have at law or in equity), but prior to any such action Subtenant
will give Sublessor written notice specifying such default with particularity,
and Sublessor shall thereupon have ten (10) days (plus such additional
reasonable period as may be required in the exercise by Sublessor of due
diligence) in which to cure any such default. Unless and until Sublessor fails
to so cure any default after such
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notice, Subtenant shall not have any remedy or cause of action by reason
thereof. All obligations of Sublessor hereunder will be construed as covenants,
not conditions; and all such obligations will be binding upon Sublessor only
during the period of its possession of the Subleased Premises and not
thereafter.
ARTICLE 12
MISCELLANEOUS PROVISIONS
12.1 TEXAS LAW TO APPLY. THIS SUBLEASE SHALL BE CONSTRUED UNDER AND IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS, AND ALL OBLIGATIONS OF THE
PARTIES CREATED HEREUNDER ARE PERFORMABLE IN XXXXXX COUNTY,TEXAS.
12.2 PARTIES BOUND. This Sublease shall be binding on and inure to the
benefit of the parties hereto and their respective heirs, executors,
administrators, legal representatives, successors and assigns.
12.3 LEGAL CONSTRUCTION. In case any one or more of the provisions
contained in this Sublease shall for any reason be held to be invalid, illegal
or unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision hereof and this Sublease shall be construed
as if such invalid, illegal or unenforceable provision had never been contained
herein.
12.4 PRIOR AGREEMENTS SUPERSEDED. This Sublease constitutes the sole
and only agreement of the parties hereto with respect to the Subleased Premises
and supersedes any prior understandings or written or oral agreements between
the parties respecting the within subject matter.
12.5 NONWAIVER. Neither acceptance of rent by Sublessor nor failure by
Sublessor to complain of any action, non-action or default of Subtenant shall
constitute a waiver of any of Sublessor's rights hereunder. Waiver by Sublessor
of any right for any default of Subtenant shall not constitute a waiver of any
right for either a subsequent default of the same obligation or any other
default. Receipt by Sublessor of Subtenant's keys to the Subleased Premises
shall not constitute an acceptance of surrender of the Subleased Premises.
Failure by Subtenant to complain of any action, non-action or default by
Sublessor shall not constitute a waiver of any of Subtenant's rights hereunder.
Waiver by Subtenant of any right for any default of Sublessor shall not
constitute a waiver of any right for either a subsequent default of the same
obligation or any other default.
12.6 BROKERS. Each party hereto acknowledges that no broker has been
employed with respect to this Sublease. Sublessor hereby agrees to defend,
indemnify and hold harmless Subtenant, and Subtenant hereby agrees to defend,
indemnify and hold harmless Sublessor, from and against any claim by third
parties for brokerage, commission, finder's or other fees relative to this
Sublease or the subleasing of the Subleased Premises to Subtenant, and any court
costs, attorneys' fees or other costs or expenses arising therefrom, which are
alleged to be due by authorization of the indemnifying party.
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12.7 NOTICES. Any notice provided or permitted to be given under this
Sublease must be in writing and may be served (i) by depositing same in the
United States mail, addressed to the party to be notified, postage prepaid and
registered or certified with return receipt requested; (ii) by delivering the
same in person to such party; or (iii) by prepaid telegram or telex. Notice
shall be effective upon receipt. For purposes of notice, the addresses of the
parties shall be as follows:
If to Sublessor: Xxxxxx Corporation
0000 Xx. Xxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: Xxxxx Xxxxxx, Chief Executive
Officer
with a copy to:
Xx. Xxxxx Xxxxxx
00 Xxxxxx Xxxxxx Xxxx
Xxxxxxxxx, Xxx Xxxx 00000
If to Subtenant: Omega Protein, Inc.
0000 Xx. Xxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: Xxxxxx X. xxx Xxxxxxxxx III,
Chief Executive Officer and
President
Either party may change its address for notice by giving written notice thereof
to the other party in accordance with the foregoing provisions of this Section
11.8.
12.8 SURRENDER OF SUBLEASED PREMISES. Upon termination or expiration of
this Sublease for any reason whatsoever, Subtenant shall peaceably quit, deliver
up and surrender the Subleased Premises to Sublessor (i) free of all claims and
encumbrances and (ii) in good order, repair and condition and in the same
condition as the Subleased Premises will be on the Commencement Date, ordinary
wear and tear excepted. Upon such termination or expiration, Sublessor may,
without further notice, enter upon, re-enter and repossess itself of the
Subleased Premises by force, summary proceedings, ejectment or otherwise, and
may dispossess or remove Subtenant from the Subleased Premises.
12.9 NO PARTNERSHIP. This Sublease shall create a landlord-tenant
relationship only between Sublessor and Subtenant. In no event shall this
Sublease create or be deemed to create a partnership, joint venture or any other
type of relationship.
12.10 NO FILING OF LEASE OR MEMORANDUM. Neither this Sublease nor any
memorandum hereof shall be filed for record without the written consent of
Sublessor, Landlord and Subtenant.
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IN WITNESS WHEREOF as of the first day written above, but effective as
of the Commencement Date.
OMEGA PROTEIN CORPORATION
By:
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Name:
Title:
XXXXXX CORPORATION
By:
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Name:
Title:
