EXHIBIT 10.3
SUBLEASE AGREEMENT
This Sublease is entered into by and between Presidio Exploration, Inc., a
Colorado corporation ("Sublessor"), and Texoil Co. ("Sublessee"), as of January
1, 1990.
WHEREAS, Home Petroleum Corporation ("Home") was the lessee of Suite 4000
on the 40th floor of the 0000 Xxxxx Xxxxxx Building (the "Building"), located at
0000 Xxxxx Xxxxxx, Xxxxxxx, Xxxxx, pursuant to a Lease Agreement dated the 15th
day of October, 1984 by and between 0000 Xxxxx Xxxxxx Venture as Landlord
("Building Landlord") and Home (the "Base Lease"); and
WHEREAS, the rights and obligations of the "Tenant" under the Base Lease
were assigned to and assumed by Home, pursuant to the Assignment and Assumption
of Lease dated December 15, 1988, executed by HPC, Inc. (as assignor) and Home
(as assignee) and consented to by Building Landlord; and
WHEREAS, Home assigned its rights under the Base Lease to Sublessor
pursuant to the assignment dated December 13, 1989 between Home and Sublessor
making Sublessor current Tenant under the Base Lease of Suite 4000 on the 40th
floor of the Building; and
WHEREAS, on January 1, 1990, Sublessor desires to sublet to Sublessee and
Sublessee desires to sublet from Sublessor that approximate 6,693 square foot
portion of the premises, and in June, 1990 Sublessor desires to sublet to
Sublessee and Sublessee desires to sublet from Sublessor an additional 2,384
square foot portion of the premises leased by Sublessor pursuant to the Base
Lease as further collectively described in the space plan attached as Exhibit A
(the "Subleased Premises");
NOW, THEREFORE, Sublessor, for and in consideration of the rents,
covenants and agreements hereinafter contained on the part of the Sublessee to
be paid, kept and performed, does hereby sublease and demise unto Sublessee, and
Sublessee hereby takes and hires from Sublessor, the Subleased Premises.
AND, Sublessor and Sublessee hereby agree as follows:
1. Sublessee covenants to pay to Sublessor during the term of this
Sublease, (a) an annual base rental of $41,754.20 ("Sublessee's Base Rent") in
equal monthly installments of $3,479.52 each in advance on the first day of each
month during the term hereof commencing on January 1, 1990 (however, during the
first five months of this Sublease Agreement, Sublessee shall pay a pro rata
monthly installment of Sublessee's Base Rent based on 6,693 square feet equal to
$2,565.65) and (b) Sublessee's proportionate share of the Additional Rent
payable by Lessor pursuant to (and as defined in) Section 4.01(i) of the Base
Lease ("Sublessee's Additional Rent"). The Sublessee's Base Rent is calculated
at the rate of $4.60 per square foot of rentable area. Sublessee's Additional
Rent shall equal the product obtained by multiplying the Additional Rent owned
by Sublessor by a fraction, (a)
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the numerator of which is the rentable area of the Subleased Premises, (b) the
denominator of which is the rentable area of the Premises under the Base Lease.
For purposes of calculating Sublessee's Base Rent and Sublessee's Additional
Rent, the rentable area of the Subleased Premises shall be deemed to be 6,693
square feet from January 1, 1990 to June 1, 1990 and 9,077 square feet
thereafter, and the rentable area of the Premises shall be deemed to be 16,783
square feet. The foregoing described Sublessee's Base Rent and Sublessee's
Additional Rent shall be paid by Sublessee without notice or demand and without
abatement, deduction or set-off of any amount whatsoever. The estimated amount
of Sublessee's Additional Rent shall be payable monthly in advance at the same
time as estimated Additional Rent is due and payable by Sublessor to Building
Landlord. If the estimated Sublessee's Additional Rent is greater or less than
the actual Sublessee's Additional Rent, then Sublessee shall pay any
underpayment or be entitled to a credit for any overpayment of Sublessee's
Additional Rent in accordance with Section 4.06 of the Base Lease.
Contemporaneously with the execution of this Sublease, Sublessee is paying to
Sublessor $5,856.38, which evidences the amount of Sublessee's Base Rent and
estimated Sublessee's Additional Rent owed for the month of January, 1990.
2. Sublessee shall accept the Subleased Premises in AS IS, WITH ALL
FAULTS, Sublessee hereby acknowledges that no representations with respect to
their condition have been made to it; provided, however, Sublessor shall pay the
cost of building two demising walls from floor to ceiling and upgrading the
necessary partitions to demising walls in accordance with plans and
specifications approved by Sublessor and Sublessee.
3. Pursuant to Article 9 of the Base Lease, the Building Landlord has
certain rights to consent or refuse its consent to this Sublease Agreement as
more fully described therein. The obligations of Sublessor and Sublessee
hereunder are subject to the obtaining of the consent hereto of Building
Landlord, and this Sublease Agreement shall not be effective until such consent
has been obtained. In the event Building Landlord has not executed this Sublease
Agreement by December 18, 1990, this Sublease Agreement shall automatically
terminate and neither Sublessor nor Sublessee shall have further rights or
obligations hereunder.
4. Except for Sections 1.02, 1.03, Article 3, 5 and 6, of the Base Lease,
attached hereto as Exhibit B, and to the extent not otherwise inconsistent with
the agreements and understandings expressed in this Sublease or applicable only
to the original parties to the Base Lease, the terms, provisions, covenants and
conditions of the Base Lease are hereby incorporated herein by reference, and
the following shall apply:
(a) The term "Landlord" as used herein shall refer to Sublessor
hereunder (and its successors and assigns), and the term "Tenant" as used
therein shall refer to Sublessee hereunder (and its permitted successors
and assigns).
(b) In any case where Building Landlord reserves the right to enter
the Subleased Premises, said right shall inure to the benefit of Building
Landlord as well as to Sublessor.
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(c) Sublessee hereby expressly assumes and agrees to perform all of
the terms, obligations, covenants and conditions required pursuant to the
Base Lease to be performed by Sublessor with respect to the Subleased
Premises, except to make any payments of rent to Building Landlord, and
not to do, suffer or permit anything to be done which would result in a
default under the Base Lease or cause the Base Lease to be terminated or
forfeited.
5. Sublessor agrees to perform all of the terms, obligations, covenants
and conditions of the "Tenant" under the Base Lease and not to do, suffer or
permit anything to be done which would result in a default under the Base Lease
or cause the Base Lease to be terminated or forfeited; provided, however, the
provisions of this Paragraph 5 shall not be construed to obligate Sublessor to
perform those obligations assumed by Sublessee pursuant to Paragraph 4(c).
6. In the event any installment of Sublessee's Base Rent or Sublessee's
Additional Rent as described in Paragraph 1 above, [the parking charges to be
paid pursuant to Paragraph 13], or any other amount due from Sublessee to
Sublessor under this Sublease Agreement (collectively, "Sublessee's Rent"), has
not been paid when due, Sublessee shall also pay late charges and default
interest for such amounts in a manner consistent with Sections 5.02 and 12.01 of
the Base Lease.
7. If Sublessee should fail to pay Sublessee's Rent when due or if
Sublessee should fail to perform Sublessee's other obligations hereunder or
should an execution, or attachment or other judicial process be levied against
any of Sublessee's property, or should Sublessee file petition for bankruptcy or
be adjudicated a bankrupt or make an assignment for the benefit of creditors,
then in any such event, Sublessee's Rent for the balance of term of this
Sublease Agreement, shall, at Sublessor's option, without the necessity of
notice, accelerate and immediately become due, and Sublessor shall have the
option to terminate this Sublease Agreement, or without terminating the Sublease
Agreement, to terminate Sublessee's right to possession and exercise any of the
other remedies available to Base Landlord under Article 18 of the Base Lease. In
either event, Sublessor may, without additional notice and without court
proceedings, re-enter and repossess the Subleased Premises and remove all
persons and property therefrom. Sublessee hereby waives any claim arising by
reason of such re-entry, repossession or removal or by reason of issuance of any
distress warrant or writ of sequestration and agrees to hold Sublessor harmless
from any such claim. If Sublessee is evicted from the Subleased Premises as the
result of any default by Sublessee hereunder, and Sublessor attempts to rent the
Subleased Premises (it being understood that Sublessor shall not be obligated to
mitigate its damages), Sublessee shall be charged with and be liable for all
costs of reletting incurred by Sublessor (such as, but not limited to, locator
service fees and brokerage fees), regardless of whether or not reletting
attempts are successful. This amount shall be in addition to past due rentals,
future rentals, and/or charges for cleaning, repairing, repainting and replacing
as hereinabove provided, or other sums due under this Sublease Agreement, and
the foregoing shall not waive or diminish Sublessor's right to recover such
additional amounts whether expressly provided herein or otherwise available to
Sublessor at law or in equity. All subsequent rentals shall be credited against
Sublessee's liability for future rentals, but in no event shall Sublessee be
entitled to any excess
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of rent (or rent plus other sums) obtained by Sublessor reletting or selling the
Demised Premises over and above the cost herein reserved.
8. If Sublessee fails to perform any of its obligations under this
Sublease Agreement, Sublessor may, but without obligation to do so and without
thereby waiving or curing such default, pay or perform or cause to be paid or
performed the underlying obligation for the account of Sublessee, in which event
the amounts paid and the reasonable and necessary costs incurred by Sublessor
(together with defaulted interest accrued thereon pursuant to Paragraph 6) shall
be considered "Sublessee's Rent" hereunder and shall be due and payable by
Sublessee to Sublessor upon the demand therefor. Sublessee agrees that Sublessor
shall be entitled to enter upon the Subleased Premises to the extent necessary
to cure any default by Sublessee hereunder.
9. In the event that Sublessee requires services, goods or materials to be
furnished by Building Landlord other than those required to be furnished under
the Base Lease, Sublessee shall pay to Building Landlord or Sublessor (as a part
of Sublessee's Rent hereunder) all charges by Building Landlord for such matters
not later than ten (10) days after Building Landlord renders a statement for
services to Sublessee pursuant to Section 5.03 of the Base Lease.
10. Except as provided in this Article 10, Sublessee shall not assign this
Sublease Agreement in whole or in part, by operation of law or otherwise, or
sublet the Subleased Premises in whole or in part without the prior written
consent of Sublessor, such consent not to be unreasonably withheld. Any attempt
to make such an assignment or to sublet the Subleased Premises without the prior
written consent of Sublessor shall be null, void and provisions of a sublease,
an outline of the terms of which has been presented to Sublessor. Sublessee
shall be entitled to keep all rent collected in said sublease, anything in the
Base Lease or this Sublease Agreement notwithstanding, but shall continue to
remit payments to Sublessor as to such 2,384 square feet as herein set forth. In
the case of a default on the party of Sublessee, any rent paid to Sublessee
pursuant to the terms of the above described sublease, shall be paid directly to
Sublessor as opposed to Sublessee.
11. Sublessee shall carry and maintain in full force and effect insurance
on terms and conditions consistent with the insurance required to be maintained
by Sublessor under Section 13.01 of the Base Lease. The insurance policies
obtained by Sublessee shall name Building Landlord and Sublessor as an
additional insured and Sublessee shall provide certificates of insurance and
copies of such policies to Building Landlord and Sublessor immediately following
their issuance.
12. Anything in this Sublease Agreement to the contrary notwithstanding,
each party hereto (the "first party") hereby waives any and every claim which
arises or may arise in favor and against the other party hereto (the "second
party") during the term of this Sublease Agreement, or an extension or renewal
thereof, for any and all loss of, or damage to, any of the first party's
property, which loss or damage is or could have been covered by Texas Standard
Form Fire, Lightning and/or Extended Coverage Insurance Policies,
notwithstanding that any sch loss or damage may be due to or result from the
negligence of either of the parties hereto or their respective employees or
agents.
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Each party hereto agrees to maintain coverage of all risks that can be covered
by Texas Standard Form Fire, Lightning and/or Extended Coverage Insurance
Policies. The foregoing shall not modify Sublessee's obligations under any
paragraph hereof requiring Sublessee to repair damage or destruction to
Subleased Premises caused by any party other than Sublessor, nor Sublessee's
liability to any third party, including other tenants in the building. Said
waiver shall be in addition to, and not in limitation or derogation of, any
other waiver or release contained in this Sublease Agreement with respect to any
losses or damage to property of the parties hereto. In as much as the above
mutual waivers will preclude the assignment of any aforesaid claim by way of
subrogation (or otherwise) to an insurance company (or any other person), each
party hereto hereby agrees immediately to give such insurance company which has
issued to it policies of fire, lightning and extended coverage insurance written
notice of the terms of said mutual waivers, and have said insurance policies
properly endorsed, if necessary, to prevent the invalidation of said insurance
coverages by reason of said waivers.
13. Sublessor shall allow Sublessee the right to 1 reserved parking space
and 11 unreserved parking spaces at current monthly changes imposed by Building
Landlord. Sublessee will pay the total charges imposed by Building Landlord for
such parking spaces.
14. If Sublessee or any party claiming under Sublessee shall remain in
possession of the Subleased Premises after the expiration or earlier termination
of this Sublease Agreement, then Sublessee shall be deemed a
tenant-at-sufferance, terminable at any time, and shall pay Sublessee's Rent at
double the rental rate of the most recent Sublessee's Rent due prior to such
termination or expiration, but otherwise shall be subject to all of the
obligations of Sublessee under this Sublease Agreement. Additionally, Sublessee
shall pay to Sublessor all damages sustained by Sublessor on account of such
holding over by Sublessee (including, without limitation, damages owed by
Sublessor to the Building Landlord as a consequence of the holding over). No
holding over by Sublessee, whether with or without consent of Sublessor, shall
operate to extend this Sublease Agreement.
15. Sublessor's rights under the Base Lease (excepting such rights as are
personal to Sublessor) may be enforced against the Building Landlord by
Sublessee in its own name or in Sublessor's name provided Sublessee advices
Sublessor in writing at least seven (7) days before taking any action to enforce
such rights. Sublessee agrees to reimburse Sublessor for any reasonable
attorney's fees or other expenses incurred by Sublessor as a result of any such
action.
16. Sublessee shall indemnify and hold Sublessor and Building Landlord
harmless from and against any and all liabilities arising from Sublessee's use
and occupancy of the Subleased Premises, or from the conduct of Sublessee's use
of the Subleased Premises, or from the conduct of Sublessee's business or from
any activity,, work or things done, suffered or permitted by Sublessee in or
about the Subleased Premises or elsewhere and shall further indemnify and hold
Sublessor and Building Landlord harmless from and against any and all claims and
any and all liabilities arising from any breach or default in the performance of
any obligation on Sublessee's part to be performed under the terms of this
Sublease or the Base Lease or arising from any negligence of Sublessee, or any
of Sublessee's agents, contractors, or employees, and from and against any and
all costs, attorney's fees,
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expenses and liabilities incurred in the defense of any such claim or any action
or proceeding brought thereon; and in case any action or proceeding be brought
against Sublessee or Building Landlord by reason of any such claim, Sublessee,
upon notice from Sublessor, shall defend the same at Sublessee's expense by
counsel satisfactory to Sublessor and Building Landlord. Sublessee, as a
material part of the consideration hereunder to Sublessor, hereby assumes all
risk of damage to property or injury to persons, in, upon or about the Subleased
Premises (excluding damage at the Premises leased by Sublessor under the Base
Lease which are not a part of the Subleased Premises herein demised) arising
from any cause (except the gross negligence of Sublessor) and Sublessee hereby
waives all claims in respect thereof against Sublessor.
17. Any rent, notices or demands to be paid or given pursuant to the Base
Lease or this Sublease Agreement shall comply with the Base Lease and shall be
sent to Sublessor or Sublessee, respectively at the addresses set forth below,
or at such other address as either party shall designate by written notice to
the other party.
To Sublessor:
Presidio Oil Co.
0000 XXX Xxxxxxx #000
Xxxxxx, Xxxxxxxx 00000
To Sublessee:
Texoil Company
Xxxxxx Xxxxxxxx
0000 Xxxxx
Xxxxxxx, Xxxxx 00000
18. This Sublease Agreement contains all of the understandings of the
parties and all representations made by either party to the other prior hereto
are merged herein. This Sublease Agreement shall be governed by the laws of the
State of Texas.
19. This Sublease Agreement may not be modified in any respect except by a
document in writing executed by both parties hereto or their respective
successors.
20. Building Landlord joins in the execution of this Sublease Agreement
for the purposes of evidencing the following and for no other purposes:
(a) Its consent to the sublease by Sublessor to Sublessee of the
Subleased Premises in accordance with the terms and provisions of this
Sublease Agreement; and
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(b) Its agreement to make available to Sublessee during the term of
this Sublease Agreement the services and rights with respect to the
Subleased Premises to which Sublessor is entitled pursuant to the terms of
the Base Lease.
(c) Its consent to the provisions of Paragraphs 2 and 10 hereof even
though such provisions may conflict with the terms of the Base Lease.
IN WITNESS WHEREOF, the parties have duly executed this Sublease as of the
day and year first above written.
SUBLESSOR:
PRESIDIO EXPLORATION, INC.
By:
Date:
SUBLESSEE:
TEXOIL COMPANY
By:
Date:
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