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EXHIBIT 10.5.12
850 E. TETON
INDUSTRIAL SUBLEASE
EFFECTIVE DATE: AUGUST 1, 1999
PARTIES AND ADDRESSES:
"AUTHORITY": TUCSON AIRPORT AUTHORITY, INC.,
an Arizona nonprofit corporation
7005 S. Plumer Avenue
Tucson, Arizona 85706
"TENANT": AAS- COMPLETE CONTROLS INC.
AN ARIZONA CORPORATION
MICAH CHAPMAN, PRESIDENT AND
JOE CIVILETTO, CHIEF OPERATING OFFICER
850 E. TETON RD. SUITE 8
TUCSON, ARIZONA 85706
EXHIBITS: Exhibits lettered A, B and C are annexed
to this Sublease and incorporated herein
by this reference.
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RECITALS
A. Authority has leased from the City of Tucson, a municipal
corporation, the airport known as Tucson International Airport
located in Pima County, State of Arizona (the "Airport").
B. Tenant desires to sublease from Authority a portion of the
Airport and to have certain rights, licenses, services and
privileges in connection with the Airport.
COVENANTS AND CONDITIONS
ARTICLE I - PREMISES
1.1 PREMISES
Authority does hereby demise and let unto Tenant, for its exclusive use
and occupancy, and Tenant does hereby lease from Authority, the
building located on the Airport at 7001 S. PARK AVE (the "Premises"),
APPROXIMATELY SEVENTY FIVE THOUSAND SIX HUNDRED (75,600) SQUARE FEET,
AS SHOWN ON EXHIBIT A, subject to all utility easements and rights of
way that encumber the Premises and subject to the terms hereof.
1.2 ACCESS
Tenant is granted the right of reasonable access to the Premises over
such other portions of the Airport as is necessary to provide
reasonable access to and from the Premises. Authority reserves the
right to designate the location of such access and to change its
location from time to time, as Authority deems reasonably necessary and
appropriate.
1.3 SECURITY
Tenant is responsible for securing Tenant's Premises, and neither the
Authority nor its agents or employees will be responsible for any loss
of or damage to Tenant's possessions while stored on the Premises.
1.4 PARKING
Tenant shall be entitled to utilize the parking areas associated with
the Premises in common with other tenants of adjacent facilities. The
Authority reserves the right, but shall not be obligated, to assign
specific parking spaces to tenants.
1.5 ENTRY UPON PREMISES
Authority may enter upon the Premises subleased exclusively to Tenant
hereunder at any
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reasonable time, for any purpose necessary, incidental to or connected
with the exercise of its governmental functions, or to inspect the
Premises for compliance with all applicable laws and rules and
regulations or to prevent waste, loss or destruction. Authority shall,
in addition, have the right to enter upon the Premises and perform any
actions necessary or appropriate in connection with any environmental
investigation or remediation, including but not limited to the
trenching, drilling and installation, monitoring, repair, replacement
and operation of pipes, wells, and related equipment. The rent due
hereunder shall equitably abate with respect any portion of the
Premises rendered unusable as a result of the Authority's exercise of
its rights under this Section.
ARTICLE II - TERM
2.1 INITIAL TERM
The initial term of the Sublease shall be for a period of five (5)
years beginning on the Effective Date hereof (the "Initial Term")
2.2 EXTENSIONS
The term hereof shall be deemed to be automatically extended on each of
the first five anniversaries of the Effective Date hereof, for an
additional one-year period, unless the Authority, at lease ninety (90)
days prior to such date, notifies Tenant that the Authority does not
elect to so extend the term. The intent of this provision is to
automatically extend the term of this Sublease each year (unless
otherwise elected by Authority) so that a remaining term of
approximately 5 years is maintained, for a possible maximum total term
of (10) years.
ARTICLE III - RENT AND DEPOSITS
3.1 BASE RENT
Tenant covenants and agrees to pay Authority rent from the Effective
Date of this Sublease in an amount equal to SEVENTEEN THOUSAND THREE
HUNDRED EIGHTY EIGHT DOLLARS AND NO CENTS ($17,388.00) per month with
FOUR PERCENT INCREASES ANNUALLY BEGINNING WITH THE START OF YEAR THREE
as set forth on the rent schedule attached as Exhibit C. Monthly rent
is due and payable to Authority in advance. Rent payments shall be
delivered to Authority's Property Manager who is currently Tucson
Industrial Centers, Inc., located at 850 E. Teton, Suite 1, Tucson, AZ
85706, or such other person as directed by Authority in writing.
3.2 COMMENCEMENT OF RENTAL OBLIGATION
The first monthly payment, prorated to reflect the partial month for
which it is paid, shall be
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due on the Effective Date hereof and subsequent installments shall be
due on the first day of each succeeding calendar month thereafter
during the term of this Sublease.
3.3 LATE FEES
If any rent or any other sum due from the Tenant shall not be received
within FIVE (5) DAYS after such amount shall be due, Tenant shall pay a
late fee equal to TEN PERCENT (10%) of such overdue amount. Acceptance
of such late fees shall in no event constitute a waiver of Tenant's
default with respect to such overdue amount nor prevent Authority from
exercising any of the other right and remedies granted hereunder.
3.4 SECURITY DEPOSIT
Simultaneously with the entry into this Sublease by the parties hereto,
the Tenant shall deposit with Authority, $17,388.00 which shall be
retained by Authority as security for the Tenant's payment of the Rent
and performance of all of its other obligations under the provisions of
this Lease, and shall not be deemed to represent payment of any rent.
On the occurrence of an Event of Default (as defined in Section 11.1
hereinbelow), Authority shall be entitled, at its sole discretion, (a)
to apply any or all of such sum in payment of (i) any Rent due and
unpaid, (ii) any expense incurred by Authority in curing any such
default, and/or (iii) any damages incurred by Authority by reason of
such default (including, by way of example rather than by limitation,
reasonable attorney's fees), in which event the Tenant shall,
immediately on its receipt of a written demand there for from
Authority, pay to Authority a sum equaling the amount so applied, so as
to restore the security deposit to its original amount; and /or (b) at
Authority's election, to retain any or all of such sum not otherwise
applied pursuant to the provisions of clause (a) of this sentence in
liquidation of any or all damages suffered by Authority by reason of
such default. On the termination of this Sublease, any of such sum
which is not so applied or retained shall be returned to Tenant. Such
sum shall not bear interest while being held by Authority.
ARTICLE IV - USE OF PREMISES
4.1 PURPOSES
The Premises shall not, without prior written consent of Authority, be
used for any purpose other than or in addition to that set forth on
Exhibit B attached hereto.
4.2 INDEMNITY
Tenant agrees to fully indemnify and save and hold harmless Authority
and the City of Tucson from and against all claims, fines, damages,
penalties, actions and all expenses, including reasonable attorneys'
fees incidental to the investigation and defense thereof, related to or
arising out of the fault or negligence of or violation of law by
Tenant, its agents,
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employees or subtenants in the use, occupancy, or maintenance of the
Premises by any of them.
4.3 DANGEROUS CONDITIONS
Tenant agrees to exercise reasonable care when using the Premises and
all improvements thereon to discover and promptly remedy any conditions
that may pose an unreasonable risk of harm to members of the general
public or that may constitute a violation of law. If an unsafe,
defective or dangerous condition, or violation of the law is
discovered, Tenant warrants that no one other than Tenant and Authority
employees, agents and representatives will be admitted to the Premises
and no property belonging to any party other than Tenant and Authority
will be transported to, collected at or stored upon the Premises until
the unsafe, defective or dangerous condition, or violation of law is
corrected.
4.4 ALTERATIONS
The Authority will complete the electrical service entrance upgrade at
the southwest corner of the building (cost to be determined but not to
exceed $17,388). Tenant shall not construct or substantially alter or
modify any buildings, structures, or other improvements on the Premises
without the Authority's prior written approval of its plans and
specifications, which approval may not be unreasonably withheld.
4.5 UTILITIES
A. Tenant's Responsibilities:
Tenant shall pay for all utility services supplied to it or
its subtenants on the Airport.
B. Authority's Rights and Responsibilities:
Notwithstanding the execution of this Sublease, Authority
retains the right to the continued use of such utility lines
and services as are presently on the Premises and the right to
repair the same when necessary. Authority shall conduct such
repairs in such manner and at such times as to not
unreasonably interfere with Tenant's operations.
4.6 MAINTENANCE AND REPAIR
A. Tenant:
(1) Tenant shall, at no expense to Authority, maintain
the Premises in a neat, clean, safe condition and in
a manner that is compatible with the adjacent
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facilities, and in compliance with all applicable
laws, rules, regulations and orders. Tenant shall be
responsible for all minor repairs and maintenance.
(2) General combustible storage shall not exceed 12 feet
in height.
(3) Aisle separation shall be between 4 feet to 8 feet
wide. (Width to be determined by Fire Department and
classification of commodities being stored).
(4) Must have stable storage piles (No leaning stacks).
B. Authority:
Subject to Section 5.9 the Authority shall be responsible for
all structural repairs in the Premises unless necessitated by
any negligence or willful misconduct of Tenant or Tenant's
subtenants, employees, agents, invitees or guests.
ARTICLE V - INSURANCE AND CASUALTY
5.1 INSURANCE REQUIRED
Tenant shall obtain and maintain in full force, with a company or
companies authorized to transact the business of insurance in the State
of Arizona and of sound and adequate financial responsibility, selected
by Tenant and acceptable to Authority, comprehensive insurance policy
(either as part of any other policy or policies carried by Tenant, or
separately) providing for the protection of the Authority and the City
of Tucson and officers, directors, agents and employees of either of
them, against:
(1) general liability, including all direct or contingent
loss or liability for damages for bodily injury,
personal injury, death or damage to property,
including loss of use thereof, occurring on or in any
way related to the Premises or occasioned by reason
of occupancy by and the operations of Tenant upon, in
and around the Premises, with limits of $1,000,000
per occurrence for personal injury or death or damage
to property, with coverage at least as broad as that
provided by INSURANCE SERVICES OFFICE COMMERCIAL
GENERAL LIABILITY COVERAGE form CG0001 (Occurrence
Form), and such policy or policies shall cover all of
Tenant's operations on the entire Premises, including
but not limited to any elevators and escalators
therein and any sidewalks, streets or other public
ways adjoining the Premises; and
(2) automobile liability covering owned, non-owned,
leased and hired vehicles with combined single limits
of no less than $250,000 per occurrence.
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5.2 DEDUCTIBLE
The deductible for any policy required hereunder shall not exceed
$1,000.
5.3 MODIFICATION OF REQUIREMENTS
Authority may adjust or increase liability insurance amounts and
requirements as Authority deems reasonably necessary, or as may be
required because of changes in the insurance requirements imposed by
Authority's insurer or by applicable law. Tenant shall comply with such
adjustments or increases within such reasonable time period as is
requested by Authority.
5.4 CERTIFICATES
Upon or prior to the commencement of the term of this Sublease and at
least annually thereafter Tenant shall furnish to Authority
certificates of insurance showing the amount and type of the insurance
then in effect that is required to be procured and maintained by it
hereunder and stating the date and term of the policies evidencing such
insurance. Tenant shall, upon request, supply Authority with certified
copies of all applicable insurance policies, riders, endorsements and
declaration pages. Certificates evidencing any renewal, replacement or
extension of any or all of the insurance required hereunder, or of
renewals, replacements or extensions of such renewals, replacements or
extensions, shall be delivered by Tenant to Authority not less than
thirty (30) days prior to the expiration of any policy of insurance
renewed, replaced or extended by the insurance represented by any such
certificate. Each policy of insurance required hereunder shall provide
for not less than thirty (30) days notice to Authority and Tenant
before such policy may be canceled.
5.5 ADDITIONAL INSURANCE
The provisions of this Sublease as to insurance required to be procured
and maintained shall not limit or prohibit, or be construed as limiting
or prohibiting, Authority or Tenant from obtaining any other or greater
insurance with respect to the Premises or improvements thereon or the
use and occupancy thereof that either or both of them may wish to
carry, but in the event Authority or Tenant, as the case may be, shall
procure or maintain any such insurance not required by this Sublease,
the cost thereof shall be at the expense of the party procuring or
maintaining the same.
5.6 ADDITIONAL INSUREDS
All insurance required by this Article shall be procured and maintained
in the name of Tenant and shall add Authority and the City of Tucson as
additional insureds as their interests appear.
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5.7 WAIVER OF SUBROGATION
Each party hereto waives all claims for recovery from the other party
for any loss or damage to any of its property on the Premises insured
under valid and collectible insurance policies to the extent of any
recovery collected from such policies. The parties agree that all
material insurance policies shall be endorsed with a clause which
waives subrogation against the other party.
5.8 INSURANCE BY AUTHORITY
Authority may, upon written notice to Tenant, in the event that Tenant
fails to timely provide proof of insurance as required by Section 5.4
above, procure and maintain any or all of the insurance required of
Tenant under this Article. In such event, all costs of such insurance
procured and maintained by Authority on behalf of Tenant shall be the
responsibility of Tenant and shall be fully reimbursed to Authority
within ten (10) business days after Authority advises Tenant of the
cost thereof.
5.9 CASUALTY TO PREMISES
Authority may, but shall not be required to, maintain insurance against
loss or damage to the Premises, but shall have no obligation to repair
the Premises in the event of casualty or damage thereto. In the event
that any such casualty renders the Premises unsafe or untenantable,
this Sublease shall terminate unless Authority notifies Tenant, within
45 days of the date of the casualty, that Authority intends to repair
the Premises, in which event this Sublease shall remain in full force
and effect, although rent shall abate while the Premises are unusable.
ARTICLE VI - TAXES
6.1 TENANT'S RESPONSIBILITY
Tenant shall pay before delinquency any and all taxes levied or
assessed against the Premises, any levied or assessed against or by
reason of personal property located in, on or about the Premises, any
levied or assessed because of Tenant's right to possession of the
Premises and improvements thereon, all applicable taxes levied or
assessed by any government body as the result of Tenant's operations
and all taxes which may be levied or assessed as the result of rentals
payable under this Sublease. All such taxes and assessments for partial
years shall be apportioned and adjusted on a time basis.
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6.2 PROTEST
Tenant shall have the right at its own cost and expense to contest the
amount or validity of any such tax or assessment and to bring or defend
any actions involving the amount or validity of any such tax or
assessment in its own name or in the name of Authority; provided that,
if unsuccessful, Tenant shall pay and discharge any such tax or
assessment so contested, together with any penalties, fines, interest,
costs and expenses, including reasonable attorneys' fees, that may
result from any such action by Tenant.
ARTICLE VII - RULES, REGULATIONS AND LAWS
7.1 COMPLIANCE WITH ALL APPLICABLE LAWS
Tenant and all persons operating under the rights granted hereby shall
observe and obey all reasonable and lawful rules and regulations with
respect to the use of the Airport which have been or may in the future
be adopted by Authority and shall further abide by all applicable laws,
statutes, ordinances, rules, orders, and regulations of all governing
bodies which are now in effect or which may hereafter be put into
effect.
7.2 NON-DISCRIMINATION
A. NON-DISCRIMINATION COVENANTS
(1) The Tenant for himself, his heirs, personal
representatives, subtenants, successors in interest,
and assigns, as a part of the consideration hereof,
does hereby covenant and agree, as a covenant running
with the land, that in the event improvements are
constructed, maintained, or otherwise operated on the
Premises for a purpose for which a Department of
Transportation ("DOT") program or activity is
extended or for another purpose involving the
provision of similar services or benefits, Tenant
shall maintain and operate such improvements and
services in compliance with all other requirements
imposed pursuant to Title 49, Code of Federal
Regulations, DOT, Subtitle A, Office of the
Secretary, Part 21, Nondiscrimination in
Federally-Assisted Programs of the Department of
Transportation-Effectuation of Title VI of the Civil
Rights Act of 1964, and as said Regulations may be
amended.
(2) The Tenant for himself, his personal representatives,
successors in interest, and assigns, as a part of the
consideration hereof, does hereby covenant and agree,
as a covenant running with the land that: (1) no
person on the grounds of race, color, or national
origin shall be excluded from participation in,
denied the benefits of, or be otherwise subjected to
discrimination in the use of said improvements, (2)
that in the construction of any improvements on,
over, or under such land and the furnishing of
services thereon, no person on the grounds of race,
color, or national origin shall be excluded from
participation in, denied the benefits of, or
otherwise be subject to
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discrimination, (3) that Tenant shall use the
Premises in compliance with all other requirements
imposed by or pursuant to Title 49, Code of Federal
Regulations, Department of Transportation, Subtitle
A, Office of the Secretary, Part 21,
Non-discrimination in Federally-Assisted Programs of
the Department of Transportation-Effectuation of
Title VI of the Civil Rights Act of 1964, and as said
Regulations may be amended.
(3) Tenant shall furnish its accommodations and/or
services on a fair, equal and not unjustly
discriminatory basis to all users thereof and it
shall charge fair, reasonable and not unjustly
discriminatory prices for each unit or service,
PROVIDED THAT Tenant may be allowed to make
reasonable and nondiscriminatory discounts, rebates
or other similar type of price reductions to volume
purchasers.
(4) Tenant assures that it will undertake an affirmative
action program as required by 14 CFR Part 152,
Subpart E, to insure that no person shall on the
grounds of race, creed, color, national origin, or
sex be excluded from participating in any employment
activities covered in 14 CFR Part 152, Subpart E.
Tenant assures that it will require that its covered
sub organizations provide assurances from their sub
organizations, as required by 14 CFR Part 152,
Subpart E, to the same effort.
B. NON-COMPLIANCE
Non-compliance with an provision of this Section shall
constitute a material breach hereof and in the event of such
non-compliance Authority shall have the right to terminate
this Sublease and the estate hereby created without liability
therefore or at the election of Authority or the United
States, either or both shall have the right to judicially
enforce these provisions.
C. SUBLEASES
Tenant agrees that it shall insert the provisions of this
Section in any sublease by which Authority grants a right or
privilege to any person, firm or corporation to render
accommodations and/or services to the public on the Premises
herein subleased.
7.3 COMPLIANCE WITH FAR PART 77
Tenant shall comply with the notification and review requirements
covered in Part 77 of the Federal Aviation Regulations in connection
with any improvements or modification or alteration of improvements on
the Premises.
7.4 FAR PART 107; AIRPORT ACCESS
Tenant and all persons operating under the rights granted hereunder
shall comply with Part 107 of the Federal Aviation Regulations with
respect to aircraft operations and airport
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security at the Airport. Tenant shall at all times take all reasonable
steps to control, police and regulate the use of the Premises and of
the Airport premises to prevent unauthorized persons and the general
public from obtaining access to the Airport. Such steps by Tenant shall
include, but not be limited to, steps requested by Authority and those
required under Federal Regulations. Tenant must secure the Premises so
that there is no inadvertent or purposeful unauthorized entry in or
upon the Airport by people, vehicles, or animals.
7.5 STATE AND FEDERAL AVIATION REGULATIONS
Tenant will conduct its operations and activities on the Airport so as
to conform to all applicable regulations of the Federal Aviation
Administration and the Aeronautics Division of the Arizona Department
of Transportation.
7.6 EXCLUSIVE RIGHTS PROHIBITED
It is understood and agreed that nothing herein contained shall be
construed to grant or authorize the granting of an exclusive right
within the meaning of Section 49 U.S.C. 40103(e).
7.7 ENVIRONMENTAL LAWS
Tenant, at its own expense, shall ensure that Tenant and Tenant's
agents, employees, invitees, and sublessee comply with all present and
hereafter enacted Environmental Laws, and any amendments thereto,
affecting Tenant's operation on the Premises.
A. DEFINITIONS
(1) "Environmental Laws" means any laws, regulations and
ordinances (whether enacted by the local, state,
federal government, or by the Authority) now in
effect or hereafter enacted that deal with the
regulation or protection of the environment
(including the ambient air, ground water, surface
water, and land use, including sub-strata land), or
with the generation, storage, disposal or use of
chemicals or substances that could be detrimental to
human health or the environment.
(2) "Extremely Hazardous Substances" means any substance
or material designated by the United States
Environmental Protection Agency as an "extremely
hazardous substance" under Section 302(a)(2) of the
Superfund Amendment and Reauthorization Act ("SARA")
(42 U.S.C. Section 11002(a)(2)).
(3) "Hazardous Material" means all substances, materials
and wastes that are, or that become, regulated under,
or that are classified as hazardous or toxic under
any environmental law (including, but not limited to,
Extremely Hazardous Substances and Toxic Chemicals).
(4) "Release" means any releasing, spilling, leaking,
pumping, pouring, emitting,
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emptying, discharging, injecting, escaping, leaching,
disposing, or dumping.
B. COMPLIANCE
(1) Compliance with Environmental Laws Generally. Tenant
shall not cause or permit any Hazardous Material to
be used, generated, manufactured, produced, stored,
brought upon, or released, on, under or about the
Premises, or transported to and from the Premises, by
Tenant, its agents, employees, contractors, invitees,
sublessees or any third party in violation of any
Environmental Law, provided that, in no circumstances
shall Tenant cause or permit any Extremely Hazardous
Substance or Toxic Chemical to be used, generated,
manufactured, produced, stored, brought upon, or
Released, on, under or about the Premises, or
transported to and from the Premises.
(2) Cleanup. Without limiting the foregoing, if the
presence of any Hazardous Material on, under or about
the Premises caused or permitted by Tenant results in
any contamination of the Premises, Tenant shall
promptly take all actions at its sole cost and
expense as are necessary to return the Premises to
the condition existing prior to the introduction of
any such Hazardous Material to the Premises; provided
that Authority's approval of such actions shall first
be obtained, which approval shall not be unreasonably
withheld so long as such actions would not
potentially have any material adverse effect on the
Premises. In the event Tenant shall fail timely to
commence or cause to be commenced or fail diligently
to prosecute to completion such actions as are
necessary to return the Premises to the conditions
existing prior to the introduction of any Hazardous
Material to the Premises, Authority may, but shall
not be obligated to, cause such action to be
performed, and all costs and expenses (including,
without limitation, attorneys' fees) thereof or
incurred by Authority in connection therewith shall
be paid by Tenant.
(3) Governmental Submittals. Tenant shall, at Tenant's
own cost and expense, make all submissions to,
provide all information to, and comply with all
requirements of any governmental authority having
jurisdiction (the "Government") under the
Environmental Laws. Should the Government determine
that a site characterization, site assessment and/or
a cleanup plan be prepared or that a cleanup should
be undertaken because of any release of hazardous
materials at the Premises which occur during the term
of this Sublease, then Tenant shall, at Tenant's own
cost and expense, prepare and submit the required
plans and financial assurances, and carry out the
approved plans in accordance with all requirements of
the Government.
(4) Information Sharing. Tenant shall provide to Tucson
Airport Authority a copy of any and all information,
reports, and applications submitted to the Government
as described in Paragraph X.6B.(4), whether such
submittal is routine or in response to a release or
threatened release of any Hazardous
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Material, and whether the impetus for such submittal
is generated by Tenant, or by an inquiry or action by
the Government or another third party. At no cost or
expense to Authority, Tenant shall promptly provide
all information requested by Authority to determine
the applicability of the Environmental Laws to the
Premises, or to respond to any governmental
investigation or to respond to any claim of liability
by third parties which is related to environmental
contamination. Tenant shall immediately notify
Authority of any correspondence or communication from
any governmental entity regarding the application of
Environmental Laws to the Premises or Tenant's
operation of the Premises.
(5) Change in Use of Premises. Tenant shall immediately
notify Authority of any changes in Tenant's operation
on the Premises that will change or has the potential
to change Tenant's or Authority's obligations or
liabilities under the Environmental Laws.
C. INDEMNITY
Tenant shall indemnity, defend and hold harmless Authority,
its successors and assigns, its employees, agents and
attorneys from and against any and all liability, loss,
damage, expense, penalties and costs (including legal and
investigation fees or costs) arising from or related to any
claim or action for injury, liability, breach or warranty or
representation, or damage to persons or property and any and
all claims or actions brought by any party or governmental
body, alleging or arising in connection with (i) contamination
of, or adverse effects on, the environment (whether known,
alleged, potential, or threatened), or (ii) alleged or
potential violation of any Environmental Law or other statute,
ordinance, rule, regulation, judgment or order of any
government or judicial entity which are brought as a result
(whether in part or in whole) of any activity or operation on
or Release from the Premises (caused by any person or entity
other than Authority) during the term of this Sublease or any
previous sublease of the Premises by Tenant or its owners or
related entities. This obligation includes but is not limited
to all costs and expenses related to investigation and/or
cleaning up the Premises and all land, soil, and underground
or surface water as required under the law. Tenant's
obligations and liabilities under this paragraph shall
continue so long as Authority bears any liability or
responsibility under the Environmental Laws for any action
that occurred on the Premises during the term of the Sublease.
This indemnification of Authority by Tenant includes, without
limitation, costs incurred in connection with any
investigation of site conditions or any cleanup, remedial,
removal or restoration work required by any federal, state, or
local governmental agency or political subdivision because of
Hazardous Material located on the Premises or present in the
soil or ground water on, under or about the Premises. The
parties agree that Authority's right to enforce Tenant's
Promise to indemnify is not an adequate remedy at law for
Tenant's violation of any provision of this paragraph;
Authority shall have all the rights and remedies set forth in
this
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Sublease as well as all other rights and remedies provided by
law.
D. SUBTENANTS
Tenant shall insert the provisions of this section in any
lease agreement or contract by which it grants a right or
privilege to any person, firm or corporation under this
Sublease.
ARTICLE VIII - SUPERIOR RIGHTS
8.1 AGREEMENTS WITH UNITED STATES
This Sublease shall be subordinate to the provisions and requirements
of any existing or future agreement between Authority and the United
States, relative to the development, operation or maintenance of the
Airport.
8.2 RIGHTS OF GOVERNMENT DURING WAR OR NATIONAL EMERGENCY
This Sublease and all the provisions hereof shall be subject to
whatever right the United States Government now has or in the future
may have or acquire, affecting the control, operation, regulation and
taking over of the Airport or the exclusive or non-exclusive use of the
Airport by the United States during the time of war or national
emergency.
Tenant and Authority recognize that during the time of war or national
emergency the City of Tucson, owner of the Airport, has the right to
enter into agreements with the United States government for military or
naval use of part or all of the Airport. If any such agreement is
executed by the City of Tucson, the provisions of this Sublease,
insofar as they are inconsistent with the provisions of any agreement
so made by the City of Tucson with the United States government, shall
be subject to the terms of such agreement and Tenant shall have no
claim against Authority or the City of Tucson for any loss or damage
sustained by Tenant because of the making of such agreement by the City
of Tucson. In such event, however, the amounts, if any, payable from
the City of Tucson or the United States for improvements placed on the
Premises by Tenant shall be paid to Tenant if this Sublease is in
effect at the time of such taking.
8.3 RIGHTS OF AUTHORITY
Authority reserves the right to further develop or improve the landing
area of the Airport as it sees fit, regardless of the desires or view
of Tenant and without interference or hindrance. Authority reserves the
right, but shall not be obligated to Tenant, to maintain and keep in
repair the landing area of the Airport and all publicly-owned
facilities of the Airport, together with the right to direct and
control all activities of Tenant in this regard.
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8.4 AGREEMENTS WITH CITY OF TUCSON
This Sublease is subject to the existing lease between Authority and
the City of Tucson and to the provisions of any existing or future
agreement between the City of Tucson and Authority.
8.5 ABATEMENT OF OBLIGATION TO CONSTRUCT OR REBUILD
Inasmuch as this Sublease contains certain provisions concerning
repairs, replacement and rebuilding of damaged or destroyed buildings,
construction of buildings, quiet enjoyment and other related causes
applicable to the parties to this Sublease, and inasmuch as the
Premises constitute a portion of a public Airport, it is agreed that
the parties hereto shall not be required to repair, replace, rebuild or
construct any building or portion of any building so long as the
obligated party is prevented from so doing by action of the United
States government or any agency or department thereof.
ARTICLE IX - RESERVATION OF NAVIGATION EASEMENT
9.1 EASEMENT
There is hereby reserved to Authority for the use and benefit of
aircraft using the Airport a right of flight for the passage of
aircraft in the airspace above the uppermost surface of the Premises,
together with the right to cause such noise as may be inherent in the
operation of any aircraft now known or hereafter used for navigation of
or flight in said airspace, or landing at, or taking off from, or
operating on the Airport.
9.2 STRUCTURES; ELEVATION LIMIT
Tenant, by accepting this Sublease, expressly agrees for itself, its
successors and assigns that it will not erect nor permit the erection
of any structure or object, nor permit the growth of any tree on the
Premises above the mean sea level elevation of 2460 feet. In the event
the aforesaid covenants are breached, Authority reserves the right to
enter upon the Premises and to remove the offending structure or object
and cut the offending tree, all of which shall be at the expense of
Tenant.
9.3 PURPOSES
Tenant, by accepting this Sublease agrees for itself, its successors
and assigns that it will not make use of the Premises in any manner
which might interfere with the landing and taking off of aircraft from
the Airport or otherwise constitute a hazard. In the event the
aforesaid covenant is breached, Authority reserves the right to enter
upon the Premises and cause the abatement of such interference at the
expense of Tenant.
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ARTICLE X - ASSIGNMENT AND SUBLEASE
10.1 CONSENT OF AUTHORITY
Tenant shall not sublease, assign or sell this Sublease or any interest
therein, or any portion of the Premises, without first obtaining
written consent from Authority. For this purpose, any change in
ownership or control of Tenant shall be considered an assignment of
rights hereunder. Tenant shall furnish the Authority with a copy of any
sublease or assignment entered into with respect to this Sublease or
the Premises or any portion thereof.
10.2 CONTINUING RESPONSIBILITY OF TENANT
If it is a complete assignment or sublease of the entire Premises it
shall be in writing and provide that the subtenant or assignee assumes
and agrees to perform all of the terms, covenants and agreements which
Tenant has agreed to perform under this Sublease, and that Tenant's
subtenant or assignee shall become jointly and severally liable with
Tenant, or any successor in interest of Tenant, for the performance of
the terms and covenants of this Sublease. A sublease for less than the
entire Premises shall be in writing and shall recite that it is subject
and subordinate to all the terms and provisions of this Sublease.
Neither the execution of such sublease or assignment, the Authority's
consent to the same, nor the acceptance of rent by Authority from
Tenant's subtenant or assignee shall release or in any manner affect
Tenant's liability to Authority hereunder.
10.3 SUBJECT TO THIS SUBLEASE
Any sublease between Tenant and a subtenant shall be in writing and
shall provide that said sublease is subject to all the provisions of
this Sublease.
ARTICLE XI - DEFAULTS AND REMEDIES
11.1 DEFAULT BY TENANT
Tenant shall be in default under this Sublease upon the occurrence of
any of the following "Events of Default":
A. Tenant shall fail to pay when due any installment of rent
payable pursuant to this Sublease and such failure shall
continue unremedied for a period of ten (10) days; provided
that Tenant shall not be entitled to the benefit of more than
one (1) grace period of ten (10) days under this paragraph
A(1) within any calendar year.
B. Tenant or any of Tenant's agents, employees, guests, invitees,
or subtenants, shall use Premises for any unlawful or illegal
purpose or for any purpose other than those set forth on
Exhibit B.
C. Tenant shall fail to observe or perform any other covenant,
agreement or
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obligation hereunder and such failure shall not be remedied
within thirty (30) days (or such additional time as is
reasonably required in the opinion of Authority to correct any
such failure, if Tenant has instituted corrective action and
is diligently pursuing the same) after Authority shall have
given Tenant written notice specifying which covenant,
agreement or obligation Tenant has failed to observe or
perform; provided that Tenant shall not be entitled to the
benefit of more than two (2) grace periods of thirty (30) days
(or more if permitted) under this paragraph within any
calendar year.
D. There is commenced by or against Tenant any case under the
Bankruptcy Code (Title XI of the United States Code) or any
other bankruptcy, arrangement, reorganization, receivership,
custodianship or similar proceeding under any federal, state
or foreign law, and with respect to any such case or
proceeding that is involuntary, such case or proceeding is not
dismissed with prejudice within sixty (60) days of such
filing.
E. Tenant makes a general assignment for the benefit of creditors
or applies for, consents to, or acquiesces in the appointment
of a trustee, receiver, or other custodian for Tenant or the
property of Tenant or any part thereof, or in the absence of
such application, consent, or acquiescence, a trustee,
receiver or other custodian is appointed for Tenant or the
property of Tenant or any part thereof, and such appointment
is not discharged within sixty (60) days
F. Any action is commenced against Tenant to foreclose any lien
or mortgage or other rights of Tenant in or to the Premises.
G. Tenant abandons, deserts or vacates the Premises for seven (7)
consecutive days or more.
11.2 REMEDIES OF AUTHORITY
If Tenant shall be in default hereunder as set forth above, the
Authority may exercise any of the following remedies.
A. TERMINATION
Authority may, at its election, give Tenant written notice of
its intention to terminate this Sublease on a date which shall
not be earlier than ten (10) days after such notice is given.
If all defaults have not been cured on or before the date
specified in the notice, Tenant's rights to possession of the
Premises shall cease, and with or without re-entry by
Authority, this Sublease and the term hereof shall terminate,
and Authority may then re-enter and take possession of the
Premises as provided below with respect to reentry without
termination. Any such termination must be express, and neither
notice to pay rent or to deliver up possession of the Premises
given pursuant to law, nor any proceeding instituted by
Authority, nor the failure by Tenant for any period of time to
pay any of the rent herein reserved, shall of itself operate
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to terminate this Sublease.
(1) Damages. Notwithstanding the termination of this
Sublease or any re-entry by Authority upon such
termination, Tenant shall continue to be liable for
and Authority shall be entitled to recover as
damages:
(a) the sum of all rent that is due and owing as
of the date of termination and all other
sums then owing by Tenant hereunder;
(b) all rent that would otherwise continue to
accrue during the remaining term hereof or,
at the election of Authority, the discounted
present value of the sum of all rentals
remaining to be paid for the remaining term
of this Sublease, calculated by the
Authority in its reasonable discretion; and
(c) the reasonable costs incurred by Authority
in re-letting the Premises and the
reasonable costs to Authority necessary to
place the Premises in condition for
re-letting.
(2) Credit. Any rent, income, receipts, profits or other
monies received or derived by Authority from any
re-letting or other use of the Premises after the
termination of this Sublease shall, so long as Tenant
shall continue to be liable for the payment of rent
hereunder, be credited against such rent as received
and collected.
B. REENTRY WITHOUT TERMINATION
As an alternative remedy, Authority may, without terminating
this Sublease, and after giving Tenant ten (10) days written
notice, re-enter the Premises and take possession thereof
pursuant to any legal proceedings or notice required by law,
in which event Tenant shall remain liable for the payment of
all rent and the performance of all conditions contained in
this Sublease.
(1) Reentry. Upon any such re-entry of the Premises
by Authority, Authority may expel Tenant and those
claiming through or under Tenant and remove their
property and effects (forcibly, if necessary) without
being guilty in any manner of trespass and without
any liability therefor and without prejudice to any
remedies of Authority in the event of default by
Tenant, and without liability for any interruption of
the conduct of the affairs of Tenant or those
claiming through or under Tenant which may result
from such entry. Tenant hereby irrevocably appoints
Authority as the agent and attorney-in-fact of Tenant
to remove all of Tenant's property whatsoever
situated upon the Premises and to place such property
in storage in any warehouse or other suitable place
in Tucson, Arizona, for the account of and at the
expense of Tenant and Tenant hereby exempts and
agrees to save harmless Authority from any costs,
loss or damage whatsoever arising or occasioned by
any such removal and storage of such property by
Authority or its duly authorized agents in accordance
with the provisions herein contained.
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(2) Reletting. After such re-entry, Authority shall use
reasonable diligence to re-let the Premises, or any
part or parts thereof, for such period or periods and
upon such term or terms and at such reasonable rental
or rentals and upon such other conditions as
Authority may deem advisable, with the right to make
alterations and repairs to the Premises. Tenant
hereby irrevocably appoints Authority as the agent
and attorney-in-fact of Tenant to enter upon and
re-let the Premises and to incur any necessary
expenses in doing so, all to be reimbursed by Tenant.
Tenant agrees that no acts of Authority in effecting
such re-letting shall constitute a termination of
this Sublease, irrespective of the period for which
such re-letting is made or the terms and conditions
of such re-letting or otherwise.
(3) Credit. Tenant shall receive a credit against such
rental in the amount of the proceeds, if any, of such
re-letting. Tenant's obligations, in addition to
rent, for which it shall remain liable include, but
shall not be limited to, all repossession costs,
brokerage commissions, legal expenses, attorneys'
fees, expenses of employees, removal costs,
alteration costs and expenses of preparation for
re-letting, and any other amounts expended pursuant
to action taken under this paragraph.
11.3 REMEDIES CUMULATIVE
All rights, options and remedies of Authority contained in this
Sublease shall be construed and held to be cumulative, and no one of
them shall be exclusive of the other, and Authority shall have the
right to pursue any one or all of such remedies or any other remedy or
relief which may be provided by law, whether or not stated in this
Sublease (including but not limited to any right of "self help" or
similar remedy in order to minimize any damages, expenses, penalties
and related fees or costs).
11.4 NO WAIVER
No waiver of any Event of Default of Tenant hereunder shall be implied
from any acceptance by Authority of any rent or other payments due
hereunder or any omission by Authority to take any action on account of
such default if such default persists or is repeated, and no express
waiver shall affect an Event of Default in a manner other than as
specified in said waiver. The consent or approval by Authority to or of
any act by Tenant requiring Authority's consent or approval shall not
be deemed to waive or render unnecessary Authority's consent or
approval to or of any subsequent similar acts by Tenant.
11.5 NOTICE
Any default notice tendered to Tenant hereunder shall be deemed to be
sufficient if it is reasonably calculated to put Tenant on inquiry as
to the nature and extent of such default.
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11.6 INTEREST
All amounts due the Authority hereunder shall accumulate interest at a
rate of 12% per annum or the maximum amount allowed by law, whichever
is less.
ARTICLE XII - TERMINATION BY TENANT
12.1 TERMINATION EVENTS
Tenant may terminate this Sublease at any time upon thirty (30) days
written notice to Authority upon or after the happening or continuation
of any of the following events:
A. The inability of Tenant to use, for a period of
thirty (30) consecutive days, any portion of the
rights, licenses, services or privileges of Tenant
hereunder because of any law, rule, regulation or
other action or failure to act on the part of any
United States governmental authority having
jurisdiction thereof.
B. The default by Authority in the performance of any
covenant or agreement herein required to be performed
by Authority and the failure of Authority to remedy
such default for a period of thirty (30) days after
receipt of written request or demand from Tenant to
remedy the same.
C. The assumption by the United States government or any
authorized agency thereof of the operation or control
of the Airport or any part thereof, in such manner as
to substantially restrict Tenant for a period of at
least thirty (30) consecutive days from conducting
any of its operation on the Premises.
12.2 CURE
If any of the foregoing reasons for termination by Tenant cease to
exist prior to a termination, then the right to terminate for such
reason shall cease.
12.3 NO WAIVER
No waiver by Tenant of Authority's default of any of its obligations
hereunder shall be construed to be or act as a waiver by Tenant of any
subsequent default by Authority.
ARTICLE XIII - SURRENDER OF POSSESSION, CONDITION OF
PREMISES
13.1 SURRENDER
Upon the expiration or earlier termination of this Sublease or any
extensions thereof, all rights herein granted to Tenant shall cease and
terminate and Tenant shall forthwith surrender
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the Premises to Authority.
13.2 GOOD CONDITION
The Premises shall be returned to Authority in as good condition as at
the time of occupancy by Tenant, except as otherwise provided in this
Sublease, ordinary wear and tear excepted.
13.3 REMOVAL OF PROPERTY
Tenant, and Tenant's subtenants, may remove any and all personal
property, including portable buildings, signs, trade fixtures,
machinery and equipment from the Premises prior to expiration of this
Sublease; provided, however, that Tenant shall repair any damage caused
by such removal. Title to any property remaining in the Premises after
expiration or termination of this Sublease shall vest in Authority and
Authority shall have the right and option to remove the same, restore
the Premises and recover from Tenant the costs and expenses of doing
so.
ARTICLE XIV - MISCELLANEOUS
14.1 NOTIFICATION OF CHANGES
Tenant shall promptly notify Authority of any change in Tenant's name
or address or a change in ownership.
14.2 SUCCESSORS AND ASSIGNS BOUND
All the terms, covenants and conditions of this Sublease shall extend
to and bind the successors and assigns of the respective parties
hereto.
14.3 ARTICLE HEADINGS
The article headings contained herein are for convenience and reference
and are not intended to define or limit the scope of any provisions of
this Sublease.
14.4 SEVERABILITY
If any term or condition of this Sublease shall be deemed to be invalid
or unenforceable, all other terms and conditions shall remain in full
force and effect.
14.5 APPLICABLE LAW
The terms and conditions of this sublease shall be interpreted in
accordance with the laws
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of the State of Arizona.
14.6 CONSTRUCTION OF SUBLEASE
Authority and Tenant agree that each party and its counsel have
reviewed and revised this Sublease and that any rule of construction to
the effect that ambiguities are to be resolved against the drafting
party shall not apply in the interpretation of this Sublease. No remedy
or election given by any provisions of this Sublease shall be deemed
exclusive unless so indicated, but each shall, whenever possible, be
cumulative with all other remedies in law or equity. Each provision
hereof shall be deemed both a covenant and a condition and shall run
with the land for the duration of the leasehold term or any extensions
thereof. Whenever the content of any provision shall require it, the
singular number shall be held to include the plural number and vice
versa. The form of this Sublease contemplates that Tenant will be an
entity and not one or more natural persons. If Tenant is one or more
natural persons, then all pronouns referring to Tenant shall be deemed
to be appropriately changed to fit those circumstances.
14.7 COSTS AND ATTORNEYS' FEES
A. AUTHORITY'S REVIEW
Tenant shall pay the expenses (including reasonable attorneys'
fees and the fees of other consultants) incurred by Authority
in reviewing any of the documents (including subleases, plans
and specifications of any improvements to be constructed by
Tenant, and documents created pursuant to Section ) for which
Authority's approval is required by the terms hereof.
B. ENFORCEMENT OF RIGHTS
The non-prevailing party shall promptly pay to the prevailing
party, upon demand, all costs and other expenses paid or
incurred by the prevailing party (including, without
limitation, reasonable attorney's fees) in enforcing or
exercising its rights or remedies created by, connected with
or provided for in this Sublease, whether or not any action or
proceeding is brought (including, without limitation, all such
costs, expenses and fees incurred in connection with any
bankruptcy, receivership, or other court proceedings [whether
at the trial or the appellate level]).
14.8 NOTICES
A. TO AUTHORITY
Notices to Authority in connection with this Sublease shall be
sufficiently served if physically delivered or sent by
certified mail, postage prepaid, addressed to Authority at the
address shown for it above.
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B. TO TENANT
Notices to Tenant in connection with this Sublease shall be
sufficiently served if physically delivered or sent by regular
mail, postage prepaid, addressed to Tenant at the address
shown for it above, provided that notice of utility
interference shall be sufficiently served if Authority gives
said notice to the current supervisor of Tenant's operations
on the Premises.
C. TIMING
Service of any notice or demand by physical delivery shall be
deemed complete upon the date of delivery. Service of any
notice or demand by certified mail shall be deemed complete at
the expiration of three (3) days after the date of the
certified mailing if mailed within the continental United
States.
D. CHANGE IN ADDRESS
Each party may change its address to such other addresses as
such party may designate to the other in writing from time to
time.
14.9 AUTHORITY TO EXECUTE
Each party represents and warrants to the other that it has the right
and authority to enter into this Sublease.
IN WITNESS WHEREOF the parties have executed this Sublease as of the day and
year first above written.
TUCSON AIRPORT AUTHORITY, INC.,
an Arizona nonprofit corporation
By: /s/ Signature Illegible
------------------------------------
Its:
------------------------------------
"AUTHORITY"
AAS-COMPLETE CONTROLS, INC.
an Arizona Corporation
By: /s/ Micah Chapman
------------------------------------
Micah Chapman
Its: President
------------------------------------
"TENANT"
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By: /s/ Joe Civiletto
------------------------------------
Joe Civiletto
Its: Chief Operating Officer
------------------------------------
"TENANT"
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