EXHIBIT 10.24
STANDARD COMMERCIAL LEASE
ARTICLE 1.00 BASIC LEASE TERMS
1.01 PARTIES. This lease agreement ("Lease") is entered into by and
between the following Landlord and Tenant:
Vantage Development #21, Inc., a Texas corporation ("Landlord").
I-Sector, a Delaware corporation ("Tenant").
1.02 LEASED PREMISES. In consideration of the rents, terms, provisions
and covenants of this Lease, Landlord hereby leases, lets and demises to the
Tenant the following described premises ("Leased Premises") as shown on Exhibit
A attached hereto, located within the Building or Project referenced below and
located on the Land as described on Exhibit B attached hereto (the "Land");
"BUILDING" OR "PROJECT": Waters Ridge Tech Center I
Building or Project Square Footage: 227,495
"LEASED PREMISES": 0000 Xxxxxxx Xxxxx, Xxxxx 000
Leased Premises Square Footage: 24,081
City, State, Zip Code: Xxxxxxxxxx, Xxxxx 00000,
together with the right to use, in common with others the Common Areas (as
defined in Section 2.06), for the Term specified herein, all upon and subject to
the terms and conditions set forth herein.
Landlord and Tenant acknowledge that the square footage of the Leased
Premises and Building are as set forth above.
1.03 TERM. The term (the "Term") of this Lease shall commence on the
date Landlord delivers the Leased Premises to Tenant with the Landlord
Improvements (as defined in Section 6.01) complete in accordance with the Plans
(as defined in Section 6.01) (the "Commencement Date") and terminate seventy two
(72) months thereafter (the "Termination Date"). For purposes of this Section
1.03, complete means a condition that allows Tenant to occupy the Leased
Premises and conduct its business therein. Tenant agrees that Landlord will not
be liable to Tenant if Landlord does not deliver possession of the Leased
Premises to Tenant on the Commencement Date and Landlord's non-delivery of the
Leased Premises to Tenant on the Commencement Date will not change the terms of
this Lease or the obligations of Tenant hereunder. If delivery of the Leased
Premises is delayed, Landlord and Tenant agree that the Commencement Date will
be delayed until possession of the Leased Premises is delivered to Tenant, in
which event the Term will be automatically extended for a period of time equal
to the delay in delivery of possession of the Leased Premises to Tenant. If
delivery of possession of the Leased Premises is delayed, Landlord and Tenant
shall, upon such delivery, execute an amendment to this Lease setting forth the
actual Commencement Date and Termination Date. Any occupancy of the Leased
Premises by Tenant prior to the Commencement Date shall be subject to all
obligations of Tenant under this Lease. If the Termination Date falls on a day
other than the last day of a month, the parties agree that the Term shall be
automatically extended by the number of days necessary to cause the Term to end
on the last day of a month.
Notwithstanding the foregoing, if Landlord fails to deliver the Leased
Premises to Tenant on or before July 1, 2004, and such failure does not result
from an event of force majeure, act of God or any act or omission of Tenant,
Tenant may terminate the Lease upon written notice to Landlord.
1.04 BASE RENT AND SECURITY DEPOSIT.
a) Base Rent for the Leased Premises shall be:
Months 1-7: Abated
Months 8-24: $13,048
Months 25-48: $20,068
Months 49-72: $22,074
b) The Security Deposit to be deposited by Tenant shall
be: $14,786.00
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1.05 ADDRESSES.
Landlord's Address: Tenant's Address:
Vantage Companies Prior to Commencement Date:
0000 Xxxxxx Xxxxx Xxxx. 00000 Xxxxxx Xxxx, Xxxxx 000
Xxxxx 000 Xxxxxxx, Xxxxx 00000
Xxxxxx, Xxxxx 00000 Attn.: Xx. Xxxx Xxxxx
After Commencement Date:
@ The Leased Premises
Xx. Xxxx Xxxxx
1.06 PERMITTED USE. Tenant shall use the Leased Premises for general
office, laboratory and research and development uses, warehousing, equipment
configuration, staging, shipping, receiving, remote network monitoring services,
help desk services and other matters related or incident to Tenant's primary
business and for no other purpose.
ARTICLE 2.00 RENT
2.01 BASE RENT. Tenant agrees to pay monthly as Base Rent during the
Term without notice, demand, deduction, counter-claim, set-off or abatement, the
sum of money set forth in Section 1.04 of this Lease. Tenant shall pay one
monthly installment of Base Rent on the date of execution of this Lease by
Tenant for the eighth month's Base Rent and a like monthly installment shall be
due and must be paid on or before the first day of the ninth calendar month and
each month thereafter during the Term; provided, if the Commencement Date is a
date other than the first day of a calendar month, the Base Rent set forth above
will be prorated to the end of that calendar month, and all succeeding
installments of Base Rent shall be payable on or before the first day of each
succeeding calendar month during the Term. No payment by Tenant or receipt by
Landlord of a lesser amount than the amount of Base Rent due will be deemed to
be other than on account of the earliest past due installment of Base Rent
required to be paid hereunder. Tenant agrees that no endorsement or statement on
any check or in any letter accompanying any check or payment of Base Rent
constitutes an accord and satisfaction and Landlord may accept such check or
payment without prejudice to Landlord's right to recover the balance of Base
Rent then due or to pursue any remedy available under this Lease, at law or in
equity.
2.02 SECURITY DEPOSIT. Tenant shall deliver the Security Deposit to
Landlord on the date of execution of the Lease by Tenant. The Security Deposit
will be held by Landlord without liability for interest and as security for the
performance of Tenant's covenants and obligations under this Lease, it being
expressly understood that it is not an advance payment of Base Rent, Taxes and
Insurance (as defined in Section 2.04), Operating Expenses (as defined in
Section 2.06) or a measure of Landlord's damage upon an Event of Default (as
defined in Section 11.01). Landlord may commingle the Security Deposit with its
other funds. During the continuance of an Event of Default (as defined in
Section 11.01), Landlord may, from time to time, without prejudice to any other
remedy, use the Security Deposit, to the extent necessary, to make good any
arrears of Base Rent, Taxes and Insurance, Operating Expenses, or pay any
expense or liability incurred by Landlord as a result of the Event of Default.
Provided Tenant delivers the Leased Premises to Landlord as required herein upon
expiration or earlier termination of this Lease, Landlord shall return any
remaining balance of the Security Deposit to Tenant within sixty (60) days
following such expiration or termination of this Lease. If any portion of the
Security Deposit is so used or applied, Tenant shall upon ten (10) days written
notice from Landlord, deposit with Landlord by cash or cashier's check an amount
sufficient to restore the Security Deposit to its original amount. If Landlord
transfers its interest in the Leased Premises during the Term, Landlord shall
assign the Security Deposit to the transferee and, upon delivery to Tenant of a
copy of an assumption of Landlord's obligations hereunder, have no further
liability for the return of, or any matter relating to, such Security Deposit.
2.03 DEFINITIONS. For purposes of this Lease, (i) Tenant's Pro Rata
Share shall be a fraction, the numerator of which is the number of square feet
of floor area in the Leased Premises set forth in Section 1.02 and the
denominator of which is the number of square feet of floor area in the Building
or Project set forth in Section 1.02, provided, if the Project contains multiple
buildings, and expenses (i.e. Taxes, Insurance and Operating Expenses)
associated with operating such buildings can be directly attributed to a
building, Landlord may utilize the square feet of floor area in such building as
the denominator. Tenant's
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Pro Rata Share may be adjusted by Landlord in the future for changes in the
physical size of the Leased Premises, Building or Project, and (ii) Additional
Rent shall include (x) Taxes and Insurance, (y) Operating Expenses, and (z) all
other amounts due Landlord from Tenant pursuant to the terms of this Lease.
2.04 TAXES AND INSURANCE. Tenant agrees to pay without notice, demand,
counter-claim, deduction, set-off or abatement of any kind Tenant's Pro Rata
Share of all real property taxes and installments of special assessments
(including dues and assessments by means of deed restrictions and/or owner's
associations) lawfully levied or assessed against the Building and/or Project,
and any and all insurance required herein or as Landlord deems reasonably
necessary (specifically including fire and casualty, commercial general
liability and rent loss [a/k/a business income] insurance) (collectively "Taxes
and Insurance"). Landlord shall invoice Tenant monthly (in advance) for Tenant's
Pro Rata Share of Taxes and Insurance commencing on the Commencement Date.
Tenant's Pro Rata Share will be based upon Landlord's estimate of Taxes and
Insurance for the current calendar year, provided, that in the event Landlord is
required under a mortgage, deed of trust, underlying lease or loan agreement
covering the Building or Project to escrow Taxes and Insurance, Landlord may but
will not be obligated, to use the amount required to be escrowed as a basis for
its estimate. To the extent the Commencement Date or Termination Date of the
Lease is not on the first day of the calendar year or last day of the calendar
year respectively, Tenant's liability for Taxes and Insurance is subject to a
pro rata adjustment based on the number of days of any such year during which
the Term is in effect. Tenant is not entitled to contest or appeal any value
assessment rendered by applicable taxing authorities and waives all rights to
receive notices of reappraisals. In no event shall Tenant be liable for any
income or franchise taxes imposed upon Landlord unless such taxes are in
substitution of the taxes set forth above.
2.05 OPERATING EXPENSES. Tenant agrees to pay without notice, demand,
deduction, counterclaim, set-off or abatement of any kind, Tenant's Pro Rata
Share of Landlord's operating expenses for the Building and/or Project as set
forth in Section 2.06 ("Operating Expenses"). Landlord shall invoice Tenant
monthly for Tenant's Pro Rata Share of the estimated Operating Expenses for each
calendar year commencing on the Commencement Date and may adjust such share each
subsequent year based upon anticipated Operating Expenses. Twice yearly Landlord
is entitled to adjust the estimated Operating Expenses to reflect current or
anticipated Operating Expenses.
Notwithstanding anything to the contrary set forth in this Section
2.05, when determining Tenant's Pro Rata Share of Operating Expenses for
calendar years subsequent to the first full calendar year of the Term, Tenant's
Pro Rata Share of Operating Expenses for such calendar years shall not increase
more than five percent (5%) from the immediately preceding calendar year.
Calculation of increases in Tenant's Pro Rata Share of Operating Expenses
subsequent to the first full calendar year of the Term shall be on a cumulative
basis, i.e. if Tenant's Pro Rata Share of Operating Expenses increases three
percent (3%) from the immediately preceding calendar year, then Tenant's Pro
Rata Share of Operating Expenses may increase seven percent (7%) for the
immediately following calendar year. Provided, the foregoing cap on Tenant's Pro
Rata Share of Operating Expenses shall not apply to utilities (water, sewer,
gas, electricity and telephone) for the Common Areas and trash removal. Tenant's
Pro Rata Share of such Operating Expenses (water, sewer, gas, electricity and
telephone) shall always be based upon the actual amount of such expenses.
Provided further, if the Building or Project is not fully leased, with respect
to calculating the foregoing cap, Landlord will be entitled to gross-up
management fees as if the Building or Project had been fully leased and fully
assessed by all taxing authorities for the previous calendar year.
Provided no Event of Default exists, Tenant may, at its own expense
(except as set forth below), audit Landlord's books relevant to the Operating
Expenses. With respect to such audit, Tenant 1) may review Landlord's books
during office hours, 2) must perform such audit at the location of Landlord's
books, 3) must request such audit within sixty (60) days of receipt of its
annual reconciliation of Operating Expenses, 4) must deliver to Landlord a copy
of the results of such audit within fifteen (15) days of its completion, and 5)
may not audit the same calendar year more than one time. Assignees of Tenant may
only audit periods for which they occupy the Leased Premises and subtenants of
Tenant are not entitled to any audit rights.
If an audit reveals that Landlord has over charged Tenant for its Pro
Rata Share of Operating Expenses by 3% or more Landlord shall reimburse Tenant
its reasonable documented out-of-pocket expenses associated with such audit
along with the amount by which Tenant overpaid.
2.06 DEFINITION OF OPERATING EXPENSES. The term "Operating Expenses"
includes all
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commercially reasonable expenses incurred by Landlord with respect to the
operation, maintenance, repair and replacement of the Common Areas (as defined
below), including, but not limited to maintenance, repair and replacement costs
necessary for upkeep (including materials and supplies necessary therefore);
charges for water, sewer, gas, electricity and telephone; cleaning, including
janitorial services and supplies; landscape maintenance; painting (within the
Common Areas and the exterior of the Building); trash collection; pest control;
security; licenses, permits and inspection fees; contractor's fees; professional
service and management fees; the cost of equipping and maintaining a management
office; wages and benefits payable to employees of Landlord whose duties are
directly connected with the operation of the Building or Project; personal
property taxes for Landlord's personal property within the Common Areas; fees
payable to tax consultants and/or attorneys for contesting taxes; the cost,
including interest, amortized over its useful life, of any capital improvement
made to the Common Areas by Landlord (i) pursuant to its obligations hereunder,
or (ii) after the date of this Lease which is required by any Legal Requirement
(as defined in Section 3.03) that was not applicable at the time the Building or
Project was constructed; the cost including interest, amortized over the period
of time necessary for such device or equipment to pay for itself, of
installation of any device or other equipment which improves the operating
efficiency of any system within the Common Areas and thereby reduces Operating
Expenses.
The term Operating Expenses does not include the following: Taxes and
Insurance, repairs, restoration or other work occasioned by fire, wind, the
elements or other casualty; expenses incurred in leasing to or procuring of
tenants, leasing commissions, advertising expenses and expenses for the
renovating of space for new tenants; interest or principal payments on any
mortgage or other indebtedness of Landlord; ground rent; compensation paid to
any employee of Landlord other than maintenance and property management
personnel directly associated with the operation and maintenance of the Building
or Project; any depreciation allowance or expense (except for depreciation of
capital improvements and equipment specifically included within the definition
of Operating Expenses); operating expenses which are the responsibility of
Tenant or any other tenant of the Building or Project; or expenses which are for
the benefit of a specific tenant and not all tenants of the Building or Project.
For purposes of this Lease "Common Areas" mean those areas within the
Building or Project provided for the common use or benefit of all tenants
generally and/or the public, such as parking areas, interior roads, sidewalks,
landscaped areas, detention or retention ponds, common office facilities or
meeting rooms, common equipment rooms, common satellite or antenna facilities,
common mail rooms, corridors, restrooms, vending areas, lobby areas, and other
Common Areas not included in or as shown as being part of the Leased Premises on
Exhibit A.
2.07 RECONCILIATION. Within four (4) months following the close of each
calendar year, Landlord shall provide Tenant an accounting showing in reasonable
detail all computations of Taxes and Insurance and Operating Expenses due under
Sections 2.04 and 2.05. If the accounting shows that the total of the monthly
payments made by Tenant exceeds the amount of Taxes and Insurance and Operating
Expenses due by Tenant, such amount will be credited against the next required
payment of Taxes and Insurance and Operating Expenses. If the accounting shows
that the total of the monthly payments made by Tenant is less than the amount
due by Tenant, such accounting will be accompanied by an invoice for the
additional amount. Notwithstanding any other provision in this Lease, during the
year in which the Lease terminates, Landlord, prior to the Termination Date, is
entitled to invoice Tenant for Tenant's Pro Rata Share of the excess Operating
Expenses based upon the previous year's Operating Expenses. If this Lease
terminates on a day other than the last day of a calendar year, the amount of
any Taxes and Insurance and Operating Expenses payable by Tenant applicable to
the year in which such termination occurs will be prorated on the ratio that the
number of days from the commencement of the calendar year to and including the
Termination Date bears to 365.
2.08 LATE PAYMENT CHARGE. Other remedies for nonpayment of Base Rent
notwithstanding, if the monthly Base Rent payment is not in Landlord's
possession on or before the tenth (10th) day of the month for which the Base
Rent is due, or if any payment of Additional Rent due Landlord by Tenant is not
received by Landlord on or before the tenth (10th) day of the month next
following the month in which Tenant was invoiced, such amount shall bear
interest at the lesser of (i) the highest lawful rate per annum or (ii) the rate
of one percent (1%) per month until paid for each late payment that occurs more
than once in any twelve (12) month period during the Term. In addition, Landlord
is entitled to charge one hundred dollars ($100.00) for each check or payment,
which is not honored by Tenant's bank. Said charge to be in addition to any
other amounts owed under this Lease.
2.09 HOLDING OVER. If Tenant does not vacate the Leased Premises upon
the expiration or
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termination of this Lease, such holding over shall constitute, and be construed
as, a tenancy at will at a daily rental equal to one-thirtieth (1/30th) of an
amount equal to, in addition to Additional Rent, one and one-half (1 1/2 ) times
the Base Rent being paid by Tenant immediately prior to the expiration or
termination of the Lease, and all other terms and provisions of this Lease shall
apply during such holdover period (with the exclusion of any expansion or
renewal options). During such holdover period, Tenant agrees to vacate and
deliver the Leased Premises to Landlord within ten (10) days of Tenant's receipt
of notice from Landlord to vacate. Landlord may give such notice pursuant to the
notice provisions of Section 14.07 herein or by facsimile transmission. Tenant
agrees to pay the rental payable during the holdover period to Landlord on
demand. No holding over by Tenant, whether with or without the consent of
Landlord and notwithstanding receipt by Tenant of an invoice from Landlord for
holdover rent, will operate to extend the Term. Additionally, Tenant shall pay
to Landlord all damages sustained by Landlord as a result of such holding over
by Tenant.
ARTICLE 3.00 OCCUPANCY AND USE
3.01 USE. The Leased Premises shall be used and occupied only for the
purpose set forth in Section 1.06 and for no other purpose without the consent
of Landlord, such consent not to be unreasonably withheld, conditioned or
delayed. Tenant shall occupy the Leased Premises, conduct its business and
control its agents, employees, invitees and visitors in such a manner as is
lawful, reputable, will not create a nuisance, interfere with Building and/or
Project operations, or affect the structural integrity or design capabilities of
the Building. Tenant shall not conduct any auction, liquidation or going out of
business sale. Outside storage including storage of trucks and other vehicles is
prohibited unless approved by Landlord. Tenant shall neither permit any waste on
the Leased Premises nor allow the Leased Premises to be used in any way which
would, in the opinion of Landlord, be extra hazardous on account of fire or
which would in any way increase or render void the fire insurance on the
Building. If at any time during the Term the State Board of Insurance or other
insurance authority disallows any of Landlord's sprinkler credits or imposes an
additional penalty or surcharge in Landlord's insurance premiums because of
Tenant's original or subsequent placement or use of storage racks or bins,
method of storage or nature of Tenant's inventory or any other act of Tenant,
Tenant agrees to pay as additional rent the increase in Landlord's insurance
premiums directly attributable to the acts of Tenant. Notwithstanding anything
set forth in this Section 3.01, in no way does Landlord warrant or represent,
either expressly or impliedly, that Tenant's use of the Leased Premises is in
accordance with applicable codes or ordinances of the municipality within which
the Building is located.
3.02 SIGNS. No sign (which shall include balloons, flags, pennants,
banners, etc.) of any type or description visible from outside the Leased
Premises may be erected, placed or painted on or about the Leased Premises or
Building by Tenant, except those signs submitted to Landlord in writing and
approved by Landlord in writing (such approval not to be unreasonably withheld,
conditioned or delayed), and which signs are in conformance with (i) Landlord's
sign criteria established for the Project and (ii) all Legal Requirements. Such
permitted signs shall be installed at Tenant's sole cost and expense by a
contractor reasonably approved by Landlord and must be removed by Tenant in
accordance with the conditions allowing their erection upon expiration or
termination of the Lease. Any damage from such removal shall be repaired at
Tenant's sole cost and expense.
3.03 COMPLIANCE WITH LAWS, RULES AND REGULATIONS. Tenant, at Tenant's
sole cost and expense, shall comply with all laws, ordinances, orders, rules and
regulations now in effect or enacted subsequent to the date hereof ("Legal
Requirements") of state, federal, municipal or other agencies or bodies having
jurisdiction over Tenant or the use, condition and occupancy of the Leased
Premises. Tenant shall comply with the rules and regulations of the Building and
Project adopted by Landlord which are set forth on Schedule I attached to this
Lease ("Rules and Regulations"). Landlord is entitled, at all times, to change
and amend the Rules and Regulations in any reasonable manner as Landlord deems
advisable for the safety, care, cleanliness, preservation of good order and
operation or use of the Leased Premises, Building or Project. All such changes
and amendments to the Rules and Regulations must be in writing and sent to
Tenant at the Leased Premises and must thereafter be carried out and observed by
Tenant.
Landlord, as its sole cost and expense, shall comply with all Legal
Requirements of state, federal, municipal or other agencies or bodies having
jurisdiction over Landlord with respect to operation of the Project. Landlord
represents and warrants that on the Commencement Date, the Leased Premises will
be in compliance with applicable Legal Requirements.
3.04 WARRANTY OF POSSESSION. Landlord warrants that it has the right
and authority to execute this
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Lease, and Tenant, upon compliance with the terms, conditions, covenants and
agreements contained in this Lease, will be entitled to possession of the Leased
Premises during the Term as well as any extension or renewal thereof. Tenant
agrees that Landlord is not responsible for the acts or omissions of any other
tenant or third party that may interfere with Tenant's use and enjoyment of the
Leased Premises.
3.05 INSPECTION. Landlord or its authorized agents may, at any and all
reasonable times upon twenty four (24) hour prior notice to Tenant, except in
the event of an emergency, when notice is not required, enter the Leased
Premises to inspect the same, conduct tests, environmental audits or other
procedures to determine Tenant's compliance with the terms hereof; to supply any
other service to be provided by Landlord; to show the Leased Premises to
prospective purchasers, tenants or mortgagees; to alter, improve or repair the
Leased Premises or any other portion of the Building or for any other purpose
Landlord deems necessary. Tenant shall not change Landlord's lock system or in
any other manner prohibit Landlord from entering the Leased Premises. Landlord
is entitled to use any and all means which Landlord may deem proper to open any
door in an emergency without liability therefor. During the final one hundred
eighty (180) days of the Term, Landlord or its authorized agents have the right
to erect or maintain on or about the Leased Premises or the Building customary
signs advertising the Leased Premises for lease.
3.06 HAZARDOUS WASTE. The term "Hazardous Substances," as used in this
Lease means pollutants, contaminants, toxic or hazardous wastes, or any other
substances, the presence or use of which is regulated, restricted or prohibited
by any "Environmental Law," which term means any federal, state or local law,
ordinance or other statute of a governmental or quasi-governmental authority
relating to pollution or protection of the environment. Tenant hereby agrees
that (i) no activity will be conducted on the Leased Premises that will produce
any Hazardous Substance, except for such activities that are part of the
ordinary course of Tenant's business activities and of which Landlord has been
notified in writing (the "Permitted Activities"), provided said Permitted
Activities are conducted in accordance with all Environmental Laws; Tenant shall
obtain all required permits and pay all fees and provide any testing required by
any governmental agency; (ii) the Leased Premises will not be used in any manner
for the storage of any Hazardous Substances except for the temporary storage of
such materials that are used in the ordinary course of Tenant's business and of
which Landlord has been notified in writing (the "Permitted Materials"),
provided such Permitted Materials are properly stored in a manner and location
meeting all Environmental Laws; Tenant shall obtain any required permits and pay
any fees and provide any testing required by any governmental agency; (iii) no
portion of the Leased Premises will be used as a landfill or a dump; (iv) Tenant
will not install any underground or above ground tanks of any type; (v) Tenant
will not allow any surface or subsurface conditions to exist or come into
existence that constitute, or with the passage of time may constitute a public
or private nuisance; (vi) Tenant will not permit any Hazardous Substances to be
brought onto the Leased Premises, except for the Permitted Materials, and if so
brought or found located thereon, the same must be immediately removed, with
proper disposal, and all required cleanup procedures must be diligently
undertaken pursuant to all Environmental Laws.
Landlord or Landlord's representative have the right but not the
obligation to enter the Leased Premises in accordance with Section 3.05 for the
purpose of inspection to ensure compliance with all Environmental Laws. Should
Landlord determine, in Landlord's commercially reasonable opinion, that any
Hazardous Substances, including Permitted Materials, are being improperly
stored, used, or disposed of, or any Hazardous Activities are being improperly
conducted, then Tenant shall immediately take such corrective action as required
by Landlord. Should Tenant fail to take such corrective action within ten (10)
days, or such shorter period as may be necessary to avoid or prevent damage to
the Leased Premises, Landlord is entitled to perform such work and Tenant shall
promptly reimburse Landlord for any and all commercially reasonable costs
associated with said work. If at any time during or after the Term, the Leased
Premises are found to be so contaminated or subject to said conditions, due to
the existence of Hazardous Substances within the Leased Premises, Tenant shall
diligently institute proper and thorough cleanup procedures at Tenant's sole
cost. Before taking any action to comply with Environmental Laws or to clean up
Hazardous Substances contaminating the Leased Premises, Tenant shall submit to
Landlord a plan of action, including all plans and documents required by any
Environmental Law to be submitted to a governmental authority (collectively a
"plan of action"). Such plan of action must be implemented by a licensed
environmental contractor. Before Tenant begins the actions necessary to comply
with Environmental Laws or to clean up contamination from Hazardous Substances,
Landlord must (1) approve the nature, scope and timing of the plan of action,
and (2) approve any and all covenants and agreements to affect the plan of
action.
Tenant represents and warrants to its actual knowledge that it has not
been previously cited for any environmental violations by any applicable
governmental agency.
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3.07 PARKING AND ROAD USE. Tenant is granted the license and right to
use, for the benefit of Tenant, its employees, customers, invitees and
licensees, 1) the parking areas adjacent to the Building of which the Leased
Premises are a part on an unassigned, unreserved and non-exclusive basis as
available on a first come, first serve basis, and 2) the roadways within the
Project, in each case subject to reasonable regulation by Landlord. Landlord
reserves the right in its sole discretion to designate specific areas within the
parking areas for the exclusive use of Tenant, its visitors and invitees to the
Building. In no event shall Tenant use more parking spaces than the minimum
number of parking spaces required by all Legal Requirements for office/warehouse
projects in the municipality in which the Project is located. No parking is
permitted on any common drive areas by Tenant or any of Tenant's employees,
customers, invitees or licensees. No driving or parking of any vehicles on
non-paved areas adjoining the Building or within the Project is permitted.
LANDLORD WILL HAVE NO LIABILITY TO TENANT, ITS EMPLOYEES, AGENTS OR INVITEES FOR
ANY CLAIMS OR LIABILITIES ARISING FROM SUCH PARTIES' USE OF THE PARKING AREAS
AND TENANT WILL INDEMNIFY AND HOLD LANDLORD HARMLESS AGAINST ALL SUCH CLAIMS AND
LIABILITIES UNLESS CAUSED BY THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF
LANDLORD.
3.08 PERMITS. Tenant shall, at its sole cost, be responsible for all
permits with respect to the operation of its business and use and occupancy of
the Leased Premises and will provide copies of such permits from time to time
upon the written request of Landlord.
ARTICLE 4.00 UTILITIES AND SERVICE
4.01 BUILDING SERVICES. Landlord shall provide water, sewer,
electricity and gas service connections to the Leased Premises. Tenant shall
arrange for connection to such services and pay directly to the appropriate
supplier all cost of utility services to the Leased Premises, including, but not
limited to, security deposits, initial connection charges, taxes, penalties,
surcharges or the like, all charges for gas, electricity, telephone, water,
sprinkler monitoring devices, sanitary and storm sewer service, and security
systems. If any services are jointly metered with other premises or property,
Landlord shall make a reasonable determination of Tenant's proportionate share
of the cost of such services and Tenant shall pay such share to Landlord within
ten (10) days of receipt of any invoice thereof. Landlord may cause, at Tenant's
expense, any utility services which are jointly metered to be separately
metered. Tenant shall pay all costs caused by Tenant introducing excessive
pollutants or solids other than ordinary human waste into the sanitary sewer
system, including permits, fees and charges levied by any governmental
subdivision for any such pollutants or solids. Tenant shall be responsible for
the installation and maintenance of any dilution tanks, holding tanks, settling
tanks, sewer sampling devices, sand traps, grease traps or similar devices as
may be required by any governmental subdivision for Tenant's use of the sanitary
sewer system. If the Leased Premises are in a multi-occupancy Building, Tenant
shall pay all surcharges levied due to Tenant's use of sanitary sewer or waste
removal services insofar as such surcharges affect Landlord or other tenants in
the Building. Except as set forth herein, Landlord shall not be required to pay
for any utility services, supplies or upkeep in connection with the Leased
Premises. Utility services for the Common Areas shall be part of Operating
Expenses.
Tenant agrees that Landlord shall not be liable to Tenant in any
respect for damages to either person, property or business on account of any
interruption or failure of utility services unless resulting from the gross
negligence or willful misconduct of Landlord. No such interruption or failure
may be construed as an eviction of Tenant or entitle Tenant to (i) any abatement
of rent, (ii) terminate the Lease, or (iii) be relieved from fulfilling any
covenant or agreement contained herein, provided, if any interruption or failure
of utilities is the result of the gross negligence or willful misconduct of
Landlord and such condition continues in excess of five (5) business days from
the date Tenant notifies Landlord, Base Rent shall xxxxx until the affected
utilities are restored to the Leased Premises. Should any malfunction of the
improvements or facilities to the Leased Premises or Building (which by
definition do not include any improvements or facilities of Tenant above
Building standard improvements) occur for any reason, Landlord shall use
reasonable diligence to see that such malfunction is corrected promptly, but
Tenant will not be entitled to any claim for rebate or abatement of rent or
damages (except as set forth above) on account of such malfunction or of any
interruptions in service occasioned thereby or resulting therefrom.
4.02 TELECOMMUNICATIONS. Tenant, at its sole cost, may order and use
telephone and other wired telecommunications services in accordance with rules
and regulations adopted by Landlord from time to time, but Tenant must obtain
Landlord's prior written consent to Tenant's use of services of a telephone or
telecommunications service provider who is not then providing service to the
Building such consent not to
Page -7-
be unreasonably withheld, conditioned or delayed. Unless Landlord otherwise
requests or consents in writing, Tenant's telecommunications equipment must be
located in the Leased Premises. Landlord has no obligation to maintain Tenant's
telecommunications equipment, wiring, or other infrastructure, and if any such
service is interrupted, curtailed, or discontinued, Landlord will have no
obligation or liability to Tenant, unless such interruption, curtailment or
discontinuance results from the gross negligence or willful misconduct of
Landlord.
(a) Upon expiration or termination of this Lease, Tenant, at its sole
cost, will remove all telecommunications equipment and other facilities for
telecommunications transmittal (except wiring) installed in the Leased Premises
or in the Building for Tenant's use.
(b) Tenant will not use any wireless communications equipment (other
than cellular telephones and Tenant's wireless network), antennae, or satellite
receiver dishes within the Leased Premises nor within the Building or Project
without Landlord's prior written consent, such consent not to be unreasonably
withheld, conditioned or delayed.
(c) If Tenant's telecommunications service, transmitters, or receivers
unreasonably interfere with Landlord's or another occupant's telecommunications
services or equipment, Tenant will promptly eliminate any such interference or,
if Tenant cannot eliminate it, stop using the equipment or service causing such
interference. Tenant assumes liability for all claims and liabilities related to
such interference.
4.03 SECURITY SERVICE. Tenant acknowledges and agrees that, while
Landlord may patrol the Project, Landlord is not providing any security services
with respect to the Leased Premises and that Landlord shall not be liable to
Tenant for, and Tenant waives any claim against Landlord with respect to, any
loss by theft or any other damage suffered or incurred by Tenant in connection
with any unauthorized entry into the Leased Premises or any other breach of
security with respect to the Leased Premises.
ARTICLE 5.00 REPAIRS AND MAINTENANCE
5.01 EXISTING CONDITIONS. Tenant accepts the Leased Premises as of the
date hereof, subject to all recorded matters, laws, ordinances, and governmental
rules, regulations and orders. Tenant acknowledges that neither Landlord nor any
agent of Landlord has made any warranty or representation of any kind, either
express or implied as to the condition of the Leased Premises or the suitability
of the Leased Premises for Tenant's intended use. The taking of the possession
of the Leased Premises by Tenant will be conclusive evidence that Tenant accepts
the Leased Premises, that the Leased Premises have been completed in accordance
with Section 6.01 and were in good and satisfactory condition at the time such
possession was so taken, subject to latent defects and punch-list items that do
not interfere with the operation of Tenant's business within the Leased
Premises. Prior to taking occupancy of the Leased Premises, Tenant shall sign a
copy of the space plan of the Leased Premises acknowledging its condition on the
date thereof (unless Landlord waives such requirement) and execute Landlord's
Standard Tenant Acceptance of Premises form accepting such condition.
5.02 LANDLORD REPAIRS AND MAINTENANCE. Landlord is not required to
maintain or make any repairs or replacements of any kind or character to the
Leased Premises or the Building during the Term except as are set forth in this
Section 5.02. Landlord shall maintain in good repair and condition, except for
reasonable wear and tear, only the roof, foundation, surfaces and structural
soundness of exterior walls and the Common Areas. Landlord shall not be
responsible for windows, window glass, plate glass, doors, store fronts,
uninsured losses and damages caused by Tenant or any third party, provided,
Landlord shall be responsible for any damage to windows, window glass or plate
glass resulting from improper or defective construction of the Building.
Landlord's costs of maintaining the items set forth in this section are subject
to the Additional Rent provisions in Section 2.03. Tenant is not entitled to any
abatement or reduction of rent by reason of any maintenance, repairs or
replacements made by Landlord under this Lease. Nothing contained herein
entitles Tenant to perform any maintenance or make any repairs or replacements
to the Leased Premises at Landlord's expense or to terminate the Lease based on
the physical condition of the Leased Premises.
5.03 TENANT REPAIRS AND MAINTENANCE. Tenant shall, at its sole cost and
expense, maintain, repair and replace all other parts of the Leased Premises in
good repair and condition (reasonable wear and tear and damages caused by
casualty or condemnation excepted), including, but not limited to windows,
window glass, plate glass, doors, store fronts, floor covering, interior walls,
partitions and finish work,
Page -8-
interior side of structural walls, water closets, kitchens, interior plumbing,
electrical systems, heating, ventilating and air-conditioning systems, down
spouts, fire sprinkler system, dock bumpers, levelers, lights, truck and rail
doors, pest control and extermination and trash pick-up and removal. Tenant
shall repair and pay for any damage caused by any act or omission of Tenant or
Tenant's agents, employees, invitees, licensees or visitors to the Leased
Premises, the Building, or the Project. Repairs and replacements shall be done
in a good and workmanlike manner and in accordance with all Legal Requirements.
If Tenant fails to maintain, repair or replace promptly as required herein,
Landlord may, at its option, perform on Tenant's behalf and charge the cost of
such performance to Tenant as Additional Rent which is due and payable by Tenant
within ten (10) days from receipt of Landlord's invoice. Costs under this
section are the total responsibility of Tenant and do not constitute Operating
Expenses under Section 2.03.
Landlord agrees that Tenant may receive the benefit of all guaranties
and warranties owned by Landlord on items for which it is responsible for repair
and maintenance, provided it complies with all conditions established in any
such guaranty or warranty.
5.04 REQUEST FOR REPAIRS. All requests for repairs or maintenance that
are the responsibility of Landlord pursuant to any provision of this Lease must
be made in writing to Landlord at the address in Section 1.05 and delivered
pursuant to Section 14.07. Notices sent by facsimile transmission are not
considered proper notice for purposes hereof. After receipt of written notice,
Landlord is entitled to a reasonable time within which to perform such repairs
or maintenance.
5.05 TENANT DAMAGES. Tenant shall not allow any damage to be committed
to any portion of the Leased Premises or Building, and at the termination of
this Lease Tenant shall deliver the Leased Premises to Landlord in as good
condition as existed at the Commencement Date of this Lease, ordinary wear and
tear excepted. Tenant shall notify Landlord in writing prior to vacating the
Leased Premises and arrange to meet with Landlord for a joint inspection
immediately prior to evacuation. The cost and expense of any repairs necessary
to restore the condition of the Leased Premises shall be borne by Tenant. Should
Landlord be required to expend any sums to ensure compliance with this Section
5.05, Tenant shall reimburse Landlord within ten (10) days of receipt of notice
from Landlord.
5.06 MAINTENANCE CONTRACT. Tenant shall, at its sole cost and expense,
during the Term maintain a regularly scheduled preventative maintenance/service
contract on an annual basis with a maintenance contractor for the servicing of
all heating, ventilation and air conditioning systems and equipment within or
servicing the Leased Premises. The maintenance contractor and contract must be
approved by Landlord and must include all services suggested by the equipment
manufacturer. A copy of the service contract shall be provided to Landlord
within sixty (60) days following the Commencement Date. In the event the service
contract is not provided, then Landlord shall have the right, but not the
obligation to have the work done and the cost therefor shall be charged to
Tenant as Additional Rent and shall become payable by Tenant with the payment of
the rent next due hereunder.
ARTICLE 6.00 ALTERATIONS AND IMPROVEMENTS
6.01 LANDLORD IMPROVEMENTS. Landlord will complete the construction of
the improvements to the Leased Premises, including installation of any covered
carports as shown in the Plans (the "Landlord Improvements"), in accordance with
the plans and specifications attached hereto as Exhibit "C", subject to approval
by local regulatory authorities (the "Plans"). Any changes or modifications to
the Plans must be made and accepted by written change order or agreement signed
by Landlord and Tenant and will constitute an amendment to this Lease. Any
Landlord Improvements made by Landlord are the property of Landlord and must be
surrendered to Landlord upon the termination of this Lease without credit to
Tenant. Upon completion of any Landlord Improvements, Landlord shall provide and
Tenant shall acknowledge receipt and acceptance of "as-built plans" of all work
done in accordance with this Section 6.01. Tenant acknowledges that the cost of
any Landlord Improvements shall include the reasonable cost of preparation of
the Plans and a construction management fee payable to Landlord of five percent
(5%) of the total cost of construction of the Landlord Improvements.
6.02 TENANT IMPROVEMENTS. Tenant shall not make or allow to be made any
alterations or physical additions in or to the Leased Premises ("Tenant
Alterations") without complying with all Legal Requirements and without first
obtaining the written consent of Landlord, which consent shall not be
unreasonably withheld, conditioned or delayed Consent may be conditioned upon
review and approval of plans and specifications and monitoring of construction
by Landlord. Landlord's review of Tenant's plans and specifications and
monitoring of construction shall be solely for Landlord's benefit and shall
impose no
Page -9-
duty or obligation on Landlord to confirm that the plans and specifications
and/or construction comply with any Legal Requirements. Any Tenant Alterations
shall be made or performed at Tenant's sole cost and expense by a contractor or
contractors acceptable to Landlord and in a good, workmanlike and lien free
manner. All Tenant Alterations are the property of Landlord and must be
surrendered to Landlord upon the termination of this Lease without credit to
Tenant; provided, however, Landlord, at its option, may require Tenant to remove
any Tenant Alterations in order to restore the Leased Premises to the condition
existing at the time Tenant took possession, all costs of removal to be borne by
Tenant, provided notice of such requirement is delivered to Tenant at the time
consent for the Tenant Alterations is given. This clause does not apply to
moveable equipment or furniture owned by Tenant, which may be removed by Tenant
at the end of the Term if no Event of Default then exists and if such equipment
and furniture are not then subject to any other rights, liens and interest of
Landlord and such removal can be accomplished without material damage to the
Leased Premises. Upon completion of any Tenant Alterations, Tenant shall provide
Landlord with "as built plans" (on CADD form), copies of all construction
contracts and proof of payment for all labor and materials (including lien
waivers). To defer the cost to Landlord associated with Tenant Alterations and
confirming that such improvements are in accordance with the terms of this Lease
and comply with all Legal Requirements, Tenant shall reimburse Landlord upon
demand, as Additional Rent, any sums expended by Landlord for third party
examination of the architectural, mechanical, electrical and plumbing plans for
any Tenant Alterations.
Tenant, at its own cost and expense and without Landlord's prior
approval, may erect such shelves, bins, machinery and trade fixtures
(collectively "Trade Fixtures") in the ordinary course of its business provided
that such items do not alter the basic character of the Leased Premises, do not
overload or damage the Leased Premises, may be removed without injury to the
Leased Premises, and the construction, erection, and installation thereof
complies with all Legal Requirements and with Landlord's requirements set forth
above. Upon expiration or earlier termination or this Lease, Tenant shall remove
its Trade Fixtures and shall repair any damage caused by such removal.
ARTICLE 7.00 CASUALTY AND INSURANCE
7.01 SUBSTANTIAL DESTRUCTION. (a) If the Leased Premises or any part
thereof are damaged by fire or other casualty, Tenant shall give prompt written
notice thereof to Landlord. 1) If the Leased Premises are totally destroyed by
fire or other casualty, 2) if the Leased Premises are damaged so that rebuilding
cannot reasonably be completed within one hundred eighty (180) days after the
date of written notification by Tenant to Landlord of the destruction, 3) if the
Leased Premises are part of a Building which is substantially destroyed (even
though the Leased Premises are not totally or substantially destroyed), 4) if
the Leased Premises or Building is damaged by fire or other casualty and
applicable law would prevent rebuilding to substantially the condition prior to
such fire or casualty, 5) if any mortgagee requires the insurance proceeds
payable as a result of such casualty to be applied to the payment of the
mortgage debt, 6) the Leased Premises are materially damaged and less than two
(2) years remain on the Term on the date of such casualty, or 7) the insurance
proceeds are insufficient to reconstruct the Leased Premises or Building to
substantially the same condition prior to such fire or casualty, Landlord may at
its option terminate this Lease by providing Tenant written notice thereof
within sixty (60) days of such casualty and xxxxx Base Rent and Additional Rent
for the unexpired portion of the Term effective as of the date of the written
notification.
(b) If the Leased Premises or any part thereof are damaged by fire or
other casualty, Tenant shall give prompt written notice thereof to Landlord. (1)
If the Leased Premises are totally destroyed by fire or other casualty, (2) if
the Leased Premises are damaged so that rebuilding cannot reasonably be
completed within one hundred eighty (180) days after the date of written
notification by Tenant to Landlord of the destruction, (3) if the Leased
Premises are damaged by fire or other casualty and applicable law would prevent
rebuilding to substantially the condition prior to such fire or casualty, (4) if
the Leased Premises are materially damaged and less than two (2) years remain on
the Term on the date of such casualty, and in any of the foregoing situations,
the damage is not the result of any act or omission of Tenant, Tenant may at its
option terminate this Lease by providing Landlord written notice thereof within
thirty (30) days of such casualty and Base Rent and Additional Rent shall xxxxx
for the unexpired portion of the Term effective as of the date of the written
notification.
7.02 PARTIAL DESTRUCTION. If this Lease is not terminated under Section
7.01, Landlord shall proceed with reasonable diligence to rebuild or repair the
Building and Landlord Improvements, if applicable, to substantially the same
condition in which they existed prior to the damage, provided, Tenant agrees
that Landlord has no obligation to repair or rebuild any Tenant Alterations or
Tenant's furniture,
Page -10-
fixtures or personal property. If the Leased Premises are to be rebuilt or
repaired and are untenantable in whole or in part following the damage, Landlord
and Tenant agree to adjust the Base Rent and Additional Rent payable under this
Lease during the period for which the Leased Premises are untenantable to such
an extent as may be fair and reasonable under the circumstances. Landlord and
Tenant hereby waive the provisions of any law from time to time in effect during
the Term relating to the effect upon leases of partial or total destruction of
leased property and agree that their respective rights in the event of damage or
destruction are those specifically set forth herein. In no event shall Landlord
be required to spend more than the insurance proceeds received by Landlord.
7.03 PROPERTY INSURANCE. Landlord shall at all times during the Term of
this Lease maintain a Fire and Extended Coverage, Vandalism and Malicious
Mischief policy of insurance with the premiums paid in advance, issued by and
binding upon some solvent insurance company, insuring the Building and Landlord
Improvements, if applicable, in an amount equal to the full replacement cost of
the Building and Landlord Improvements, if applicable, as of the date of the
loss (exclusive of excavation and foundation costs, costs of underground items
and costs of parking lot paving and landscaping); provided, Landlord shall not
be obligated in any way or manner to insure any Tenant Alterations or any
personal property (including, but not limited to, any furniture, machinery,
goods or supplies) of Tenant upon or within the Leased Premises, or any fixtures
installed or paid for by Tenant upon or within the Leased Premises. Tenant shall
have no right in or claim to the proceeds of any policy of insurance maintained
by Landlord even if the cost of such insurance is borne by Tenant as set forth
in Article 2.00. Notwithstanding the foregoing, in the event Landlord has a net
worth in excess of $50,000,000, it shall be entitled to self insure against all
risk provided for in this paragraph in lieu of obtaining the insurance set forth
herein.
7.04 WAIVER OF SUBROGATION. ANYTHING IN THIS LEASE TO THE CONTRARY NOT
WITHSTANDING, LANDLORD AND TENANT HEREBY WAIVE AND RELEASE EACH OTHER OF AND
FROM ANY AND ALL RIGHT OF RECOVERY, CLAIM, ACTION OR CAUSE OF ACTION, AGAINST
EACH OTHER, THEIR AGENTS, OFFICERS, EMPLOYEES OR ANY PARTY CLAIMING BY, THROUGH
OR UNDER LANDLORD OR TENANT, FOR ANY LOSS OR DAMAGE THAT MAY OCCUR TO THE LEASED
PREMISES, IMPROVEMENTS TO THE BUILDING OF WHICH THE LEASED PREMISES ARE A PART,
OR PERSONAL PROPERTY WITHIN THE BUILDING, BY REASON OF FIRE, EXPLOSION, OR ANY
OTHER OCCURRENCE, REGARDLESS OF CAUSE OR ORIGIN, INCLUDING NEGLIGENCE OF
LANDLORD OR TENANT AND THEIR AGENTS, OFFICERS AND EMPLOYEES WHICH LOSS OR DAMAGE
IS (OR WOULD HAVE BEEN, HAD THE INSURANCE REQUIRED BY THIS LEASE BEEN
MAINTAINED) COVERED BY INSURANCE. LANDLORD AND TENANT AGREE IMMEDIATELY TO GIVE
THEIR RESPECTIVE INSURANCE COMPANIES WHICH HAVE ISSUED POLICIES OF INSURANCE
COVERING ALL RISK OF DIRECT PHYSICAL LOSS, WRITTEN NOTICE OF THE TERMS OF THE
MUTUAL WAIVERS CONTAINED IN THIS SECTION AND TO HAVE THE INSURANCE POLICIES
PROPERLY ENDORSED, IF NECESSARY, TO PREVENT THE INVALIDATION OF THE INSURANCE
COVERAGES BY REASON OF THE MUTUAL WAIVERS.
7.05 HOLD HARMLESS. (a) TENANT AGREES THAT LANDLORD IS NOT, AND DURING
THE TERM HEREOF WILL NOT BE, LIABLE TO TENANT OR TENANT'S EMPLOYEES, AGENTS,
INVITEES, LICENSEES OR VISITORS, OR TO ANY OTHER PERSON, CLAIMING BY, THROUGH OR
UNDER TENANT FOR AN INJURY TO PERSON OR DAMAGE TO PROPERTY ON OR ABOUT THE
LEASED PREMISES OR FOR LOSS OF OR DAMAGE TO TENANT'S BUSINESS CAUSED BY ANY ACT
OR OMISSION OF TENANT OR LANDLORD, THEIR RESPECTIVE AGENTS, SERVANTS OR
EMPLOYEES, ANY TENANT IN THE BUILDING AND/OR PROJECT OF WHICH THE LEASED
PREMISES ARE A PART, OR OF ANY OTHER PERSON ENTERING UPON THE LEASED PREMISES
UNDER EXPRESS OR IMPLIED INVITATION BY TENANT, OR CAUSED BY THE IMPROVEMENTS
LOCATED ON THE LEASED PREMISES BECOMING OUT OF REPAIR, THE FAILURE OR CESSATION
OF ANY SERVICE PROVIDED BY LANDLORD (INCLUDING HEATING, VENTILATING AND AIR
CONDITIONING SYSTEMS, SECURITY SERVICE AND DEVICES) UNLESS CAUSED BY THE GROSSS
NEGLIGENCE OR WILLFUL MISCONDUCT OF LANDLORD. TENANT AGREES TO INDEMNIFY AND
HOLD HARMLESS LANDLORD OF AND FROM ANY LOSS, ATTORNEY'S FEES, EXPENSES OR CLAIMS
ARISING OUT OF ANY SUCH DAMAGE OR INJURY.
Page -11-
(b) LANDLORD AGREES THAT TENANT IS NOT, AND DURING THE TERM HEREOF WILL
NOT BE, LIABLE TO LANDLORD OR LANDLORD'S EMPLOYEES, AGENTS, INVITEES, LICENSEES
OR VISITORS, OR TO ANY OTHER PERSON, CLAIMING BY, THROUGH OR UNDER LANDLORD FOR
AN INJURY TO PERSON OR DAMAGE TO PROPERTY ON OR ABOUT THE PROJECT (EXCLUDING THE
LEASED PREMISES) OR FOR LOSS OF OR DAMAGE TO LANDLORD'S BUSINESS CAUSED BY ANY
ACT OR OMISSION OF LANDLORD OR TENANT, THEIR RESPECTIVE AGENTS, SERVANTS OR
EMPLOYEES, OR OF ANY OTHER PERSON ENTERING UPON THE PROJECT (EXCLUDING THE
LEASED PREMISES) BY EXPRESS OR IMPLIED INVITATION OF LANDLORD, OR CAUSED BY THE
IMPROVEMENTS LOCATED ON THE PROJECT (EXCLUDING THE LEASED PREMISES) BECOMING OUT
OF REPAIR UNLESS CAUSED BY THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OR TENANT.
LANDLORD AGREES TO INDEMNIFY AND HOLD HARMLESS TENANT OF AND FROM ANY LOSS,
ATTORNEY'S FEES, EXPENSES OR CLAIMS ARISING OUT OF ANY SUCH DAMAGE OR INJURY.
7.06 TENANT'S INSURANCE.
A. At all times commencing on and after the earlier of the Commencement
Date and the date Tenant or its agents, employees or contractors enters the
Leased Premises for any purpose, Tenant shall carry and maintain, at its sole
cost and expense:
1. Commercial General Liability Insurance applicable to the
Leased Premises, its appurtenances and Tenant's actions within the
Building and Common Areas, providing, on an occurrence basis, a minimum
combined single limit of Two Million Dollars ($2,000,000.00), with a
contractual liability endorsement covering Tenant's indemnity
obligations under this Lease;
2. All Risks of Physical Loss Insurance written at full
replacement cost value and with a replacement cost endorsement covering
all of Tenant's personal property and Tenant Alterations in the Leased
Premises; and
3. Workers' Compensation Insurance as required by the state in
which the Leased Premises is located and in amounts as may be required
by applicable statute.
B. Before any repairs, alterations, additions, improvements, or
construction are undertaken by or on behalf of Tenant, Tenant shall carry and
maintain, at its expense, or Tenant shall require any contractor performing work
on the Leased Premises to carry and maintain, at no expense to Landlord, in
addition to Workers' Compensation Insurance, All Risk Builder's Risk Insurance
in the amount of the full replacement cost of any alterations, additions or
improvements and Commercial General Liability Insurance (including, without
limitation, Contractor's Liability coverage, Contractual Liability coverage and
Completed Operations coverage,) written on an occurrence basis with a minimum
combined single limit of Two Million Dollars ($2,000,000.00) and adding "the
named Landlord hereunder (or any successor thereto), and its respective members,
principals, beneficiaries, partners, officers, directors, employees, agents and
any Mortgagee(s)", and other designees of Landlord as the interest of such
designees appear, as additional insureds (collectively referred to as the
"Additional Insureds").
C. Any company writing any insurance which Tenant is required to
maintain or cause to be maintained pursuant to the terms of this Lease (all such
insurance as well as any other insurance pertaining to the Leased Premises or
the operation of Tenant's business therein being referred to as "Tenant's
Insurance"), as well as the form of such insurance, are at all times subject to
Landlord's reasonable approval, and each such insurance company must have an
A.M. Best rating of "A-" or better and be licensed and qualified to do business
in the state in which the Leased Premises are located. All policies evidencing
Tenant's Insurance (except for Workers' Compensation Insurance) must specify
Tenant as named insured and the Additional Insureds as additional insureds.
Provided that the coverage afforded Landlord and any designees of Landlord is
not reduced or otherwise adversely affected, all of Tenant's Insurance may be
carried under a blanket policy covering the Leased Premises and any other of
Tenant's locations. All policies of Tenant's Insurance must contain endorsements
requiring that the insurer(s) give Landlord and its designees at least thirty
(30) days' advance written notice of any change, cancellation, termination or
lapse of said insurance. Tenant shall be solely responsible for payment of
premiums for all
Page -12-
of Tenant's Insurance. Tenant shall deliver to Landlord at least fifteen (15)
days prior to the time Tenant's Insurance is first required to be carried by
Tenant, and upon renewals at least fifteen (15) days prior to the expiration of
any such insurance coverage, certificates evidencing all policies procured by
Tenant in compliance with its obligations under this Lease. The limits of
Tenant's Insurance do not in any manner limit Tenant's liability under this
Lease.
D. Tenant shall not do or fail to do anything in, upon or about the
Leased Premises which will (1) violate the terms of any of Landlord's insurance
policies; (2) prevent Landlord from obtaining policies of insurance acceptable
to Landlord or any Mortgagees; or (3) result in an increase in the rate of any
insurance on the Leased Premises, the Building, any other property of Landlord
or of others within the Building. In the event of the occurrence of any of the
events set forth in this Section, Tenant shall pay Landlord upon demand, as
Additional Rent, the cost of the amount of any increase in any such insurance
premium, provided that the acceptance by Landlord of such payment may not be
construed to be a waiver of any rights by Landlord in connection with a default
by Tenant under the Lease. If Tenant fails to obtain the insurance coverage
required by this Lease, Landlord may, at its option, obtain such insurance for
Tenant, and Tenant shall pay, as Additional Rent, the cost of all premiums
thereon and all of Landlord's costs associated therewith.
ARTICLE 8.00 CONDEMNATION
8.01 SUBSTANTIAL TAKING. (a) If all or a substantial portion of the
Leased Premises or a substantial portion of the Building (even though the Leased
Premises are not taken) are taken for any public or quasi-public use under any
governmental law, ordinance or regulation, or by right of eminent domain or by
purchase in lieu thereof, and the taking would prevent or materially interfere
with the use of the Leased Premises or the Building for the purpose for which it
is then being used, then Landlord may, but is not required to, terminate this
Lease and xxxxx Base Rent and Additional Rent during the unexpired portion of
this Lease effective on the date title or physical possession is taken by the
condemning authority, whichever occurs first.
(b) If all or a substantial portion of the Leased Premises are taken
for any public or quasi-public use under any governmental law, ordinance or
regulation, or by right or eminent domain or by purchase in lieu thereof, and
the taking would prevent or materially interfere with the use of the Leased
Premises for the purpose for which it is then being used, then Tenant may, but
is not required to, terminate this Lease and Base Rent and Additional Rent shall
xxxxx during the unexpired portion of this Lease effective on the date title or
physical possession is taken by the condemning authority, whichever occurs
first.
8.02 PARTIAL TAKING. If a portion of the Leased Premises or a portion
of the Building are taken as set forth in Section 8.01 above and this Lease is
not terminated as provided above, Landlord shall, at Landlord's sole risk and
expense, restore and reconstruct the Leased Premises and Landlord Improvements,
if applicable, to the extent necessary to make it reasonably tenantable,
provided, if the damages received by Landlord are insufficient to cover the
costs of restoration, Landlord may terminate this Lease. Landlord shall have no
obligation to restore any Tenant Alterations. The Base Rent and Additional Rent
payable under this Lease during the unexpired portion of the Term will be
adjusted to such an extent as is fair and reasonable under the circumstances.
8.03 In the event of any taking as set forth above, Tenant may seek a
separate award for any loss of improvements made or paid for by Tenant, its
personal property, and its moving expenses (so long as no such claim diminishes
Landlord's claim or award), but all other claims of any nature shall belong to
Landlord. In the event Tenant does not receive such a separate award, Landlord
shall be entitled to receive any and all sums awarded for the taking.
8.04 Notwithstanding anything herein to the contrary, if the holder of
any indebtedness secured by a mortgage or deed of trust covering the Building
and/or Project requires that the condemnation proceeds be applied to such
indebtedness, then Landlord shall have the right to terminate this Lease by
delivering written notice of termination to Tenant within fifteen (15) days
after such requirement is imposed.
ARTICLE 9.00 ASSIGNMENT OR SUBLEASE
9.01 LANDLORD ASSIGNMENT. Landlord is entitled to sell, transfer or
assign, in whole or in part, its
Page -13-
rights and obligations under this Lease and in the Leased Premises. Any such
sale, transfer or assignment shall, upon delivery to Tenant of a written
assumption by the transferee of Landlord's obligations hereunder, release
Landlord from all liabilities under this Lease arising after the date of such
sale, assignment or transfer, and Tenant agrees to look solely to the successor
in interest of Landlord for the performance of such obligation.
9.02 TENANT ASSIGNMENT. Tenant shall not assign, in whole or in part,
this Lease, or allow it to be assigned, in whole or in part, by operation of law
or otherwise (including without limitation, if Tenant's voting securities are
not traded on any national securities exchange, by transfer of more than a fifty
percent (50%) interest in Tenant in a single transaction or in a series of
transactions, which transfer will be deemed an assignment) or mortgage or pledge
the same or sublet the Leased Premises, in whole or in part, without the prior
written consent of Landlord which consent shall not be unreasonably withheld,
conditioned or delayed. In no event will any such assignment or sublease ever
release Tenant or any guarantor from any obligation or liability hereunder.
9.03 CONDITIONS OF ASSIGNMENT. If Tenant desires to assign or sublet
all or any part of the Leased Premises it must so notify Landlord at least
thirty (30) days in advance of the date on which Tenant desires to make such
assignment or sublease. Tenant shall provide Landlord with a copy of the
proposed assignment or sublease and such information as Landlord might request
concerning the proposed subtenant or assignee to allow Landlord to make informed
judgments as to the financial condition, reputation, operations and general
desirability of the proposed subtenant or assignee. Within fifteen (15) days
after Landlord's receipt of Tenant's proposed assignment or sublease and all
required information concerning the proposed subtenant or assignee, Landlord is
entitled to exercise any of the following options: (1) consent to the proposed
assignment or sublease, pursuant to a Consent Agreement on a form approved by
Landlord in its reasonable discretion, and, if the rent due and payable by any
assignee or subtenant under any such permitted assignment or sublease (or a
combination of the rent payable under such assignment or sublease plus any bonus
or any other consideration or any payment incident thereto) exceeds the rent
payable under this Lease for such space, Tenant shall pay to Landlord fifty
percent (50%) of such excess rent and other excess consideration immediately
upon receipt thereof by Tenant, after deducting therefrom all costs and expenses
incurred by Tenant in connection with such assignment or sublease, or (2)
refuse, in its reasonable discretion and judgment, to consent to the proposed
assignment or sublease. If Landlord exercises option (1) above, and thereafter
an Event of Default occurs, Landlord, in addition to any other remedies provided
by this Lease or provided by law, may, at its option, collect directly from the
assignee or subtenant all rents becoming due to Tenant by reason of the
assignment or sublease, and Landlord will be entitled to a security interest in
all property located on the Leased Premises to secure payment of such sums.
Tenant agrees that any collection directly by Landlord from the assignee or
subtenant may not be construed as, or constitute, a novation or a release of
Tenant or any guarantor from the further performance of its obligations under
this Lease. As a condition to a request for Landlord's review of any assignment
or sublease, Tenant must pay Landlord all reasonable out-of-pocket legal fees
and expenses incurred by Landlord in connection with the review by Landlord of
Tenant's requested assignment or sublease together with any reasonable
out-of-pocket legal fees and disbursements incurred in the preparation and/or
review of any documentation required by the requested assignment or sublease
within five (5) days of demand for payment thereof, provided Tenant's
responsibilities for such amounts shall not exceed $1,000.
9.04 SUBORDINATION. Tenant accepts this Lease subject and subordinate
to any recorded mortgage or deed of trust lien or assignment of leases and rents
presently existing or hereafter created upon the Building or Project (provided,
however, that any such mortgagee may, at any time, subordinate such mortgage,
deed of trust or other lien or assignment of leases and rents to this Lease) and
to any renewals thereof. Tenant agrees that this clause is self-operative and no
further instrument of subordination is required to effect such subordination.
Tenant also agrees upon demand to execute additional instruments subordinating
this Lease as Landlord may require. If the interests of Landlord under this
Lease are transferred by reason of foreclosure or other proceedings for
enforcement of any first mortgage or deed of trust lien or assignment of leases
and rents on the Leased Premises, Tenant agrees to be bound to the transferee
(sometimes called the "Purchaser"), under the terms, covenants and conditions of
this Lease for the balance of the term remaining, including any extensions or
renewals, with the same force and effect as if the Purchaser were Landlord under
this Lease, and, if requested by the Purchaser, Tenant agrees to attorn to the
Purchaser, including the first mortgagee under any such mortgage if it be the
Purchaser, as its landlord, provided, in either event such Purchaser agrees to
recognize the rights of Tenant hereunder as long as no Event of Default exists.
Upon transfer of Landlord's interest to Purchaser, Purchaser shall not be 1)
subject to any credit, demand, claim, counterclaim, offset or defense which
theretofore accrued to Tenant against Landlord; 2) liable for any previous act
or omission of Landlord, 3) unless consented to by
Page -14-
Landlord's lender, bound by any previous modification of the Lease or prepayment
of more than one month's Base Rent or Additional Rent in advance; 4) required to
account for any Security Deposit unless actually delivered to Landlord's lender
by Landlord; 5) bound by any obligation to make any payment or grant any credit
except as specifically provided for in this Lease; and 6) responsible for any
monies owing to Tenant by Landlord.
9.05 ESTOPPEL CERTIFICATES. Tenant agrees to furnish, from time to
time, within five (5) days after receipt of a request from Landlord, Landlord's
mortgagee or any potential purchaser of the Building or Project, a statement
certifying, if applicable, the following (noting any variances): Tenant is in
possession of the Leased Premises; the Leased Premises are acceptable; the Lease
is in full force and effect; the Lease is unmodified; Tenant claims no present
charge, lien, or claim of offset against Base Rent; the Base Rent is paid for
the current month, but is not prepaid for more than one month and will not be
prepaid for more than one month in advance; to Tenant's knowledge, there is no
existing default by reason of some act or omission by Landlord; and such other
matters as may be reasonably required by Landlord, Landlord's mortgagee or any
potential purchaser. Any notice and cure provisions set forth in any other part
of this Lease do not apply to a default of this section 9.05.
ARTICLE 10.00 LIENS
10.01 LANDLORD'S LIEN. As security for payment of Base Rent, Additional
Rent and damages, Tenant hereby grants to Landlord a lien upon all property of
Tenant now or subsequently located upon the Leased Premises and Tenant agrees
not remove such property from the Leased Premises except in the ordinary course
of business, provided at the time of such removal no Event of Default exists. If
an Event of Default exists, Landlord may enter upon the Leased Premises, by
picking or changing locks if necessary, and take possession of all or any part
of the personal property, and may sell all or any part of the personal property
at a public or private sale, in one or successive sales, with or without notice,
to the highest bidder for cash, on behalf of Tenant and convey all of Tenant's
title and interest in the personal property sold. The proceeds of the sale of
the personal property shall be applied by Landlord toward the reasonable costs
and expenses of the sale, including attorney's fees, and then toward the payment
of all sums then due by Tenant to Landlord under the terms of this Lease. Any
excess remaining will be paid to Tenant or any other person entitled thereto by
law.
10.02 UNIFORM COMMERCIAL CODE. This Lease is intended as and
constitutes a security agreement within the meaning of the Uniform Commercial
Code of the state in which the Leased Premises are situated. Landlord, in
addition to the rights prescribed in this Lease, is entitled to all of the
rights, titles, liens and interests in and to Tenant's property, now or
hereafter located upon the Leased Premises, which may be granted a secured
party, as that term is defined, under the Uniform Commercial Code to secure to
Landlord payment of all sums due and the full performance of all Tenant's
covenants under this Lease. Tenant shall on request execute and deliver to
Landlord a financing statement for the purpose of perfecting Landlord's security
interest under this Lease or Landlord may file this Lease or a copy thereof as a
financing statement. Unless otherwise provided by law and for the purpose of
exercising any right pursuant to this section, Landlord and Tenant agree that
any applicable requirement of reasonable notice is met if such notice is given
by ten (10) days advance written notice, sent by certified mail, return receipt
requested, to Landlord or Tenant at the addresses specified herein.
ARTICLE 11.00 DEFAULT AND REMEDIES
11.01 DEFAULT BY TENANT. The following events constitute an Event of
Default by Tenant under this Lease:
(a) Tenant fails to pay when due any installment of Base Rent, Taxes
and Insurance, Operating Expenses or Additional Rent within ten (10) days of
delivery of notice of such failure by Landlord;
(b) Tenant fails to comply with any term, provision or covenant of this
Lease, other than the payment of Base Rent or Additional Rent and such failure
continues in excess of thirty (30) days after delivery of notice of failure by
Landlord, or such additional time as may be reasonably necessary provided Tenant
commences and diligently prosecutes cure of such failure, but in no event in
excess of ninety (90) days;
(c) Tenant or any guarantor of Tenant's obligations hereunder files,
causes to be filed or has filed
Page -15-
against it a petition in bankruptcy or is adjudged bankrupt or insolvent under
any applicable federal or state bankruptcy or insolvency law, or admits that it
cannot meet its financial obligations as they become due; or a receiver or
trustee is appointed for all or substantially all of the assets of Tenant or
such guarantor; or Tenant or any guarantor of Tenant's obligations hereunder
makes a transfer in fraud of creditors or makes an assignment for the benefit of
creditors; or
(d) Tenant does or permits to be done any act which results in a lien
(of any nature) being filed against the Leased Premises, the Building or
Project, and does not cause such lien to be bonded around or discharged or
recode within thirty (30) days following such filing.
11.02 REMEDIES FOR TENANT'S DEFAULT. During the continuation of any
Event of Default, Landlord is entitled to pursue any one or more of the remedies
set forth herein without any notice or demand.
(1) Without declaring the Lease terminated, Landlord may enter upon and
take possession of the Leased Premises, by picking or changing locks if
necessary, and lock out, expel or remove Tenant and any other person who may be
occupying all or any part of the Leased Premises without being liable for any
claim for damages, and relet the Leased Premises on behalf of Tenant and receive
the rent directly by reason of the reletting. Tenant agrees to pay Landlord on
demand any deficiency that may arise by reason of any reletting of the Leased
Premises as such deficiencies occur from time to time; further, Tenant agrees to
reimburse Landlord for any expenditures made by it in order to relet the Leased
Premises, including, but not limited to, leasing commissions, lease incentives,
remodeling and repair costs and reasonable attorney's fees.
(2) Without declaring the Lease terminated, Landlord may enter upon the
Leased Premises, by picking or changing locks if necessary, without being liable
for any claim for damages, and do whatever Tenant is obligated to do under the
terms of this Lease. Tenant agrees to reimburse Landlord on demand for any
expenses which Landlord may incur in effecting compliance with Tenant's
obligations under this Lease including reasonable attorney's fees.
(3) Landlord may terminate this Lease, in which event Tenant shall
immediately surrender the Leased Premises to Landlord, and if Tenant fails to
surrender the Leased Premises, Landlord may, without prejudice to any other
remedy which it may have for possession or arrearage in rent, enter upon and
take possession of the Leased Premises, by picking or changing locks if
necessary, and lock out, expel or remove Tenant and any other person who may be
occupying all or any part of the Leased Premises without being liable for any
claim for damages. Tenant agrees to pay on demand the amount of all loss and
damage which Landlord may suffer by reason of the termination of this Lease
under this section, including without limitation, loss and damage due to the
failure of Tenant to maintain and or repair the Leased Premises as required
hereunder and/or due to the inability to relet the Leased Premises on terms
satisfactory to Landlord or otherwise, and any expenditures made by Landlord in
order to relet the Leased Premises, including, but not limited to, leasing
commissions, lease incentives, and remodeling and repair costs. In addition,
upon termination Landlord may collect from Tenant the value of all future
rentals required to be paid under this Lease from the date Landlord terminates
the Lease until the original Termination Date in accordance with applicable law.
Notwithstanding anything contained in this Lease to the contrary, this Lease may
be terminated by Landlord only by mailing or delivering written notice of such
termination to Tenant, and no other act or omission of Landlord constitutes a
termination of this Lease.
(4) If Landlord exercises its remedy to lock out Tenant in accordance
with any provision of this Lease, Tenant agrees that no notice is required to be
posted by Landlord on any door to the Leased Premises (or elsewhere) disclosing
the reason for such action or any other information, and that Landlord is not
obligated to provide a key to the changed lock to Tenant unless Tenant has
first:
(I) brought current all payments due to Landlord under this
Lease (unless Landlord has permanently repossessed the Leased Premises
or terminated this Lease, in which event payment of all past due
amounts will not obligate Landlord to provide a key);
(II) fully cured and remedied to Landlord's satisfaction all
other Events of Default; and
(III) provided Landlord with additional security deposit and
assurances satisfactory to Landlord that Tenant intends to and is able
to meet and comply with its future obligations under this Lease, both
monetary and non-monetary.
Page -16-
Upon compliance with the foregoing, Landlord shall, upon written
request by Tenant, at Landlord's convenience, upon receipt by Landlord of an
amount necessary to reimburse itself for time and expense in providing such
service, and upon Tenant's execution and delivery of such waivers and
indemnifications as Landlord may require at Landlord's option either:
(i) escort Tenant or its specifically authorized employees or
agents to the Leased Premises to retrieve personal belongings of
Tenant's employees and property of Tenant that is not subject to a
Security Interest provided in this Lease, or
(ii) obtain from Tenant a list of such property and arrange
for such items to be removed from the Leased Premises and made
available to Tenant at such place at such time as Landlord may
designate, provided however, that if Landlord elects option (ii), then
Tenant must pay in cash in advance to Landlord the estimated costs that
Landlord may incur upon moving and storage charges theretofore incurred
by Landlord with respect to such property.
(5) THE PROVISIONS OF THIS ARTICLE ARE INTENDED TO OVERRIDE AND
SUPERSEDE ANY CONFLICTING PROVISIONS OF THE TEXAS PROPERTY CODE AND ANY
AMENDMENTS OR SUCCESSOR STATUTES THERETO, AND OF ANY OTHER LAW, TO THE MAXIMUM
EXTENT PERMITTED BY THE LAW.
(6) Notwithstanding any other remedy set forth in this Lease, if
Landlord has provided any tenant improvement allowance, and Tenant fails to take
possession of the Leased Premises on the Commencement Date or otherwise allows
an Event of Default to exist at any time during the Term, any unamortized tenant
improvement allowance, will be due and payable immediately.
(7) Tenant hereby expressly waives any and all rights of redemption
granted by or under any present or future laws in the event of Tenant being
evicted or dispossessed for any cause, or in the event of Landlord obtaining
possession of the Leased Premises by reason of the violation by Tenant of any of
the covenants and conditions of this Lease or otherwise.
(8) All of Landlord's rights and remedies set forth herein are
cumulative and pursuit of any remedy specified in this Lease will not constitute
an election to pursue that remedy only, nor preclude Landlord from pursuing any
other remedy available at law or in equity, nor constitute a forfeiture or
waiver of any rent or other amount due to Landlord as described herein.
(9) If Tenant or any guarantor of Tenant's obligations hereunder is the
subject of any insolvency, bankruptcy, receivership, dissolution, reorganization
or similar proceeding, federal or state, voluntary or involuntary, under any
present or future law or act, Landlord is entitled to the automatic and absolute
lifting of any automatic stay as to the enforcement of its remedies under this
Lease, including specifically the stay imposed by Section 362 of the United
States Federal Bankruptcy Code, as amended. Tenant hereby consents to the
immediate lifting of any such automatic stay, and may not contest any motion by
Landlord to lift such stay. Tenant expressly acknowledges that the Leased
Premises is not now and will never be necessary to any plan or reorganization of
any type.
(10) LANDLORD WILL NOT BE LIABLE FOR ANY CLAIMS OR LIABILITIES ARISING
FROM LANDLORD'S EXERCISE OF ITS REMEDIES SET FORTH HEREIN UPON THE OCCURRENCE OF
AN EVENT OF DEFAULT, INCLUDING, WITHOUT LIMITATION, CLAIMS OR LIABILITIES
ARISING FROM LANDLORD'S OWN NEGLIGENCE.
11.03 LANDLORD'S DEFAULT. Landlord shall not be in default of this
Lease unless Landlord fails to perform any of its obligations hereunder within
thirty (30) days after receipt of written notice from Tenant specifying such
failure (unless such performance will, due to the nature of the obligation,
require a period of time in excess of thirty (30) days, then after such period
of time as is reasonably necessary), with notice to Landlord's mortgagee as
provided in Section 14.12. All obligations of Landlord hereunder shall be
construed as covenants, not conditions and, except as may be otherwise expressly
provided in this Lease, Tenant may not terminate this Lease for breach of
Landlord's obligations hereunder. Any liability of Landlord under this Lease
shall be limited solely to its interest in the Building or Project, and in no
event shall any personal liability be asserted against Landlord in connection
with this Lease nor shall any recourse be had to any other property or assets of
Landlord, its affiliates or any officer, director or employee of the foregoing.
Page -17-
ARTICLE 12.00 INDEMNITIES
12.01 TENANT'S INDEMNITIES. TO THE FULL EXTENT PERMITTED BY LAW AND
THIS LEASE, TENANT WILL INDEMNIFY AND DEFEND LANDLORD AGAINST ALL LIABILITIES
AND CLAIMS AND THE COSTS AND EXPENSES THEREOF, ARISING OUT OF (i) ANY ACT OR
OMISSION OF TENANT, INCLUDING WITHOUT LIMITATION TENANT'S CONDUCT OF BUSINESS IN
THE LEASED PREMISES OR THE PROJECT, (II) ANY ALLEGED OR ACTUAL VIOLATION OR
FAILURE TO COMPLY WITH ANY LEGAL REQUIREMENT, (III) ANY BREACH, VIOLATION OR
NON-PERFORMANCE OF ANY OBLIGATION OF TENANT UNDER THIS LEASE, OR (IV) ANY
MISREPRESENTATION CONNECTED WITH THE LEASE MADE BY TENANT OR ANY GUARANTOR.
12.02 LANDLORD'S INDEMNITIES. To the full extent permitted by law and
this Lease (AND EXCEPT TO THE EXTENT WAIVED AND RELEASED BY SECTION 7.04 AND
7.05), LANDLORD will indemnify and defend TENANT against all liabilities and
claims and the costs and expenses thereof, arising out of (i) any act or
omission of LANDLORD, including without limitation LANDLORD'S conduct of
business in the BUILDING or the Project, (ii) any actual violation or failure to
comply with any Legal Requirement BY LANDLORD, (iii) any breach, violation or
non-performance of any obligation of LANDLORD under this Lease, or (iv) any
misrepresentation connected with the Lease made by LANDLORD.
ARTICLE 13.00
RESERVED
ARTICLE 14.00 MISCELLANEOUS
14.01 WAIVER. Failure of Landlord to declare an Event of Default
immediately upon its occurrence, or delay in taking any action (including
enforcement of remedies) in connection with an Event of Default, does not
constitute and shall not be deemed a waiver of the Event of Default, and
Landlord is entitled to declare the Event of Default at any time and take such
action as is lawful or authorized under this Lease.
No act or thing done by Landlord or its agents during the Term may be
deemed an acceptance of an attempted surrender of the Leased Premises, and no
agreement to accept a surrender of the Leased Premises will be valid unless made
in writing and signed by Landlord. No reentry or taking possession of the
Premises by Landlord may be construed as an election on its part to terminate
this Lease, unless a written notice of such intention, signed by Landlord, is
given by Landlord to Tenant. Notwithstanding any such reletting or reentry or
taking possession, Landlord may at any time thereafter elect to terminate this
Lease for a continuing previous Event of Default. Tenant and Landlord agree that
Landlord's acceptance of rent following an Event of Default hereunder will not
constitute Landlord's waiver of such Event of Default. The failure of Landlord
to enforce any of the Rules and Regulations against Tenant or any other tenant
in the Building will not constitute a waiver of any such Rules and Regulations.
No waiver of any provision of this Lease is effective unless such waiver is in
writing and signed by Landlord.
14.02 ACT OF GOD OR FORCE MAJEURE. An "act of God" or "force majeure"
is defined for purposes of this Lease as strikes, lockouts, sitdowns, material
or labor restrictions by any governmental authority, unusual transportation
delays, riots, floods, washouts, explosions, earthquakes, fire, storms, weather
(including wet grounds or inclement weather which prevents construction), acts
of the public enemy, wars, insurrections and any other cause not reasonably
within the control of a party and which by the exercise of due diligence a party
is unable, wholly or in part, to prevent or overcome. Neither Landlord or Tenant
is required to perform any non-financial covenant or obligation in this Lease,
or be liable in damages to the other party, so long as the performance or
non-performance of the covenant or obligation is delayed, caused or prevented by
an act of God, force majeure or by the other party.
14.03 ATTORNEY'S FEES. The prevailing party in any litigation between
the parties with respect to the terms, covenants, agreements or conditions of
this Lease, shall be entitled to recover as part of its judgment, reasonable
attorney's fees and costs and expenses incurred therein.
Page -18-
14.04 SUCCESSORS. This Lease applies to, is binding upon and inures to
the benefit of Landlord and Tenant and their respective heirs, personal
representatives, successors and assigns.
14.05 RENT TAX. If applicable in the jurisdiction where the Leased
Premises are situated, Tenant shall pay and be liable for all rental, sales and
use taxes or other similar taxes, if any, levied or imposed by any city, state,
county or other governmental body having authority, such payments to be in
addition to all other payments required to be paid to Landlord by Tenant under
the terms of this Lease. Any such payment must be paid concurrently with the
payment of the Base Rent, Taxes and Insurance, Operating Expenses or other
charge upon which the tax is based as set forth above.
14.06 CAPTIONS. The captions appearing in this Lease are inserted only
as a matter of convenience and in no way define, limit, construe or describe the
scope or intent of any section.
14.07 NOTICE. All rent and other payments required to be made by Tenant
shall be paid to Landlord at the address set forth in Section 1.05 or at such
other address as Landlord may specify from time to time by written notice. All
payments required to be made by Landlord to Tenant are payable to Tenant at the
address set forth in Section 1.05 or at any other address within the continental
United States as Tenant may specify from time to time by written notice. For
purposes hereof, any notice or document required or permitted to be delivered by
the terms of this Lease (other than delivery of rental payments) will be deemed
to be delivered upon the earlier of actual receipt or (whether or not actually
received) when deposited in the United States Mail, postage prepaid, certified
mail, return receipt requested, addressed to the parties at the respective
addresses set forth in Section 1.05. Rental payments are deemed received only
upon actual receipt. Unless specifically authorized herein, any notice delivered
via facsimile transmission will not satisfy a requirement to give notice under
the terms of this Lease.
14.08 SUBMISSION OF LEASE. Submission of this Lease to Tenant for
signature does not constitute a reservation of space or an option or offer to
lease. This Lease is not deemed effective until execution by and delivery to
both Landlord and Tenant.
14.09 REPRESENTATIONS, WARRANTIES AND COVENANTS OF TENANT. (a) Tenant
represents, warrants and covenants that it is now in a solvent condition; that
no bankruptcy or insolvency proceedings are pending or contemplated by or
against Tenant or any guarantor of Tenant's obligations under this Lease; that
all reports, statements and other data furnished by Tenant to Landlord in
connection with this Lease are true and correct in all material respects; that
the execution and delivery of this Lease by Tenant does not contravene, result
in a breach of, or constitute a default under any contract or agreement to which
Tenant is a party or by which Tenant may be bound and does not violate or
contravene any law, order, decree, rule or regulation to which Tenant is
subject; and that there are no judicial or administrative actions, suits, or
proceedings pending or threatened against or affecting Tenant or any guarantor
of Tenant's obligations under this lease. If Tenant is a corporation, limited
liability company or partnership, each of the persons executing this lease on
behalf of Tenant represents and warrants that Tenant is duly organized and
existing, is qualified to do business in the state in which the Leased Premises
are located, has full right and authority to enter into this Lease, that the
persons signing on behalf of Tenant are authorized to do so by appropriate
corporate, company or partnership action and that the terms, conditions and
covenants in this Lease are enforceable against Tenant. If Tenant is a
corporation, limited liability company or partnership, Tenant, upon Landlord's
request, will deliver evidence satisfactory to Landlord that the execution and
delivery of this Lease has been duly authorized and properly executed.
(b) Representations, Warranties and Covenants of Landlord. Landlord
represents, warrants and covenants that it is now in a solvent condition; that
no bankruptcy or insolvency proceedings are pending or contemplated by or
against Landlord that all reports, statements and other data furnished by
Landlord to Tenant in connection with this Lease are true and correct in all
material respects; that the execution and delivery of this Lease by Landlord
does not contravene, result in a breach of, or constitute a default under any
contract or agreement to which Landlord is a party or by which Landlord may be
bound and does not violate or contravene any law, order, decree, rule or
regulation to which Landlord is subject; and that there are no judicial or
administrative actions, suits, or proceedings pending or threatened against or
affecting Landlord. Landlord represents and warrants that it is duly organized
and existing, is qualified to do business in the state in which the Leased
Premises are located, has full right and authority to enter into this Lease,
that the persons signing on behalf of Landlord are authorized to do so by
appropriate corporate, company or partnership action and that the terms,
conditions and covenants in this Lease are enforceable against Landlord.
Page -19-
14.10 SEVERABILITY. If any provision of this Lease or the application
thereof to any person or circumstance is rendered invalid or unenforceable to
any extent, the remainder of this Lease and the application of such provisions
to other persons or circumstances remains unaffected thereby and continues to be
enforced to the greatest extent permitted by law.
14.11 SURVIVAL. All obligations of Tenant hereunder not fully performed
as of the expiration or earlier termination of the Term shall survive the
expiration or earlier termination of the Term, including, without limitation,
all payment obligations and all obligations concerning the condition of the
Leased Premises.
14.12 NOTICE TO MORTGAGEES. Tenant shall serve written notice of any
claimed default or breach by Landlord under this Lease upon any such mortgagee,
and no notice to Landlord will be effective unless such notice is served upon
said mortgagee; notwithstanding anything to the contrary contained herein,
Tenant agrees to allow such mortgagee the same period following receipt of such
notice to cure such default or breach as is afforded Landlord; provided, in the
event it is necessary for said such mortgagee to foreclose on the property of
which the Leased Premises are a part in order to cure such default, such
mortgagee will be entitled to such additional time as is necessary to cure such
default provided such default is cured within sixty (60) days of the last day
for cure originally set forth in this Lease.
14.13 NO RECORDATION. Neither Landlord nor Tenant shall record this
Lease without the prior written consent of the other party.
14.14 COUNTERPARTS. This Lease may be executed in two or more
counterparts, and it is not necessary that any one of the counterparts be
executed by all of the parties hereto. Each fully or partially executed
counterpart constitutes an original, but all such counterparts taken together
constitute but one and the same instrument.
14.15 GOVERNING LAW/VENUE. THIS LEASE MUST BE CONSTRUED UNDER AND IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS AND THE LAWS OF THE UNITED STATES
OF AMERICA AS APPLICABLE TO TRANSACTIONS WITHIN THE STATE OF TEXAS. TENANT
HEREBY SUBMITS TO THE JURISDICTION OF ANY COURT OF COMPETENT JURISDICTION
SITTING IN DALLAS COUNTY, TEXAS.
14.16 BROKER. Tenant represents and warrants that Tenant has dealt with
no broker except Xxxxxxxxxx Realty Group ("Broker"), and that, insofar as Tenant
knows, no other broker negotiated this Lease or is entitled to any commission in
connection herewith. Landlord agrees to indemnify and hold Tenant harmless from
and against any liabilities or claims arising with respect to Broker or any
other broker or similar parties whose claim arises by, through or on behalf of
Landlord. Tenant agrees to indemnify and hold Landlord harmless from and against
any liabilities or claims (and costs of defending against and investigating such
claims) of any other broker or similar parties whose claim arises by, through or
on behalf of Tenant.
14.17 PUBLICATION. Tenant hereby agrees that Landlord may, but is not
required, at no cost to Tenant, to publicize and/or advertise the execution of
this Lease and the related transaction. Tenant will not disclose the terms of
this Lease to any other tenants in the Building or Project.
14.18 DTPA WAIVER. TENANT WAIVES ITS RIGHTS UNDER THE DECEPTIVE TRADE
PRACTICES - CONSUMER PROTECTION ACT, SECTION 17.41 ET SEQ., BUSINESS & COMMERCE
CODE, A LAW THAT GIVES CONSUMERS SPECIAL RIGHTS AND PROTECTIONS. AFTER
CONSULTATION WITH AN ATTORNEY OF TENANT'S OWN SELECTION, TENANT VOLUNTARILY
CONSENTS TO THIS WAIVER WITH RESPECT TO THIS LEASE AND THE PROPERTY LEASED UNDER
THIS LEASE. TENANT IS VOLUNTARILY AGREEING TO THE WAIVER OF CONSUMER RIGHTS
PROVISION AND CONSIDERS IT BINDING AND ENFORCEABLE; NO STATEMENT OR
REPRESENTATION BY LANDLORD, OR ANY ATTORNEY OR OTHER REPRESENTATIVE ACTING ON
ITS BEHALF, HAS INFLUENCED OR INDUCED TENANT TO AGREE TO THE WAIVER OF CONSUMER
RIGHTS PROVISION.
14.19 CONSTRUCTION OF LEASE. Tenant declares that Tenant has read and
understands all parts of this Lease, including all printed parts hereof. It is
agreed that, in the construction and interpretation of the terms of this Lease,
the rule of construction that a document is to be construed most strictly
against the
Page -20-
party who prepared the same will not be applied, it being agreed that both
parties hereto have participated in the preparation of the final form of this
Lease. Wherever in this Lease provision is made for liquidated damages, it is
because the parties hereto acknowledge and agree that the determination of
actual damages (of which such liquidated damages are in lieu) is speculative and
difficult to determine; the parties agree that liquidated damages herein are not
a penalty.
14.20 FINANCIAL STATEMENTS. Tenant acknowledges that it has provided
Landlord with its financial statement(s) as a primary inducement to Landlord's
agreement to lease the Leased Premises to Tenant, and that Landlord has relied
on the accuracy of said financial statement(s) in entering into this Lease.
Tenant represents and warrants that the information contained in said financial
statement(s) is true, complete and correct in all material aspects, and agrees
that the foregoing representations are conditions to all of Landlord's
obligations under this Lease.
At the request of Landlord (only upon the sale or refinancing of the
Building or Project, upon any extension or renewal hereof, or upon any Event of
Default), Tenant shall, not later than thirty (30) days following such request,
furnish to Landlord a financial statement of Tenant as of the end of the prior
fiscal quarter and year accompanied by a statement of income and expense for
such quarter and year then ended, together with a certificate of the chief
financial officer, owner or partner of Tenant to the effect that the financial
statements have been prepared in conformity with accounting principles
consistently applied and fairly present the financial condition and results of
operations of Tenant as of and for the periods covered.
14.21 TIME OF ESSENCE. With respect to all required acts of Landlord
and Tenant, time is of the essence of this Lease.
14.22 JOINT AND SEVERAL LIABILITY. If there is more than one Tenant,
the obligations hereunder imposed upon Tenant are joint and several. If there is
a guarantor(s) of Tenant's obligations hereunder, the obligations of Tenant are
joint and several obligations of Tenant and each such guarantor, and Landlord
need not first proceed against Tenant hereunder before proceeding against each
such guarantor, nor will any such guarantor be released from its guarantee for
any reason whatsoever, including, without limitation, any amendment of this
Lease, any forbearance by Landlord or waiver of any of Landlord's rights, the
failure to give Tenant or any such guarantor any notices, or the release of any
party liable for the payment or performance of any of Tenant's obligations
hereunder.
14.23 BUILDING NAME AND ADDRESS. Landlord reserves the right at any
time to change the name by which the Building is designated and its address, and
Landlord has no obligation or liability whatsoever for costs or expenses
incurred by Tenant as a result of such name change or address change of the
Building.
14.24 TAXES AND TENANT'S PROPERTY. Tenant is solely liable for all
taxes levied or assessed against personal property, furniture or fixtures placed
by Tenant in the Premises. If any such taxes for which Tenant is liable are
levied or assessed against Landlord or Landlord's property and if Landlord
elects to pay the same or if the assessed value of Landlord's property is
increased by inclusion of personal property, furniture or fixtures placed by
Tenant in the Premises, and Landlord elects to pay the taxes based on such
increase, Tenant shall pay Landlord upon demand that part of such taxes for
which Tenant is primarily liable hereunder.
14.25 CONSTRUCTIVE EVICTION. Tenant is not entitled to claim a
constructive eviction from the Leased Premises unless Tenant has first notified
Landlord in writing of the condition giving rise thereto, and, if the complaints
are justified, unless Landlord has failed to remedy such conditions within
reasonable time after receipt of said notice.
14.26 EXHIBITS. All exhibits, attachments, riders and addenda referred
to in this Lease are incorporated herein and made a part hereof for all intents
and purposes.
ARTICLE 15.00 AMENDMENT AND LIMITATION OF WARRANTIES
15.01 ENTIRE AGREEMENT. IT IS EXPRESSLY AGREED BY TENANT, AS A MATERIAL
CONSIDERATION FOR THE EXECUTION OF THIS LEASE, THAT THIS LEASE, WITH THE
SPECIFIC REFERENCES TO WRITTEN EXTRINSIC DOCUMENTS, IS THE ENTIRE AGREEMENT OF
THE PARTIES; THAT THERE ARE, AND WERE, NO VERBAL REPRESENTATIONS, WARRANTIES,
UNDERSTANDINGS, STIPULATIONS, AGREEMENTS OR PROMISES PERTAINING TO THIS LEASE OR
TO THE EXPRESSLY MENTIONED WRITTEN EXTRINSIC DOCUMENTS NOT INCORPORATED IN
WRITING IN THIS LEASE.
Page -21-
15.02 AMENDMENT. THIS LEASE MAY NOT BE ALTERED, WAIVED, AMENDED OR
EXTENDED EXCEPT BY AN INSTRUMENT IN WRITING SIGNED BY LANDLORD AND TENANT AND BY
ANY MORTGAGEE AS TO THE ITEMS DESCRIBED IN SECTION 14.12.
15.03 LIMITATION OF WARRANTIES. LANDLORD AND TENANT EXPRESSLY AGREE
THAT THERE ARE NO IMPLIED WARRANTIES OF MERCHANTABILITY, HABITABILITY, FITNESS
FOR A PARTICULAR PURPOSE OR OF ANY OTHER KIND ARISING OUT OF THIS LEASE, AND
THERE ARE NO WARRANTIES WHICH EXTEND BEYOND THOSE EXPRESSLY SET FORTH IN THIS
LEASE.
15.04 WAIVER OF JURY TRIAL. LANDLORD AND TENANT HEREBY AGREE NOT TO
ELECT A TRIAL BY JURY OF ANY ISSUE TRIABLE OF RIGHT BY JURY, AND WAIVES ANY
RIGHT TO TRIAL BY JURY FULLY TO THE EXTENT THAT ANY SUCH RIGHT NOW OR HEREAFTER
EXISTS WITH REGARD TO THIS LEASE. THIS WAIVER OF RIGHT TO TRIAL BY JURY IS GIVEN
KNOWINGLY AND VOLUNTARILY BY LANDLORD AND TENANT, AND IS INTENDED TO ENCOMPASS
INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO WHICH THE RIGHT TO A TRIAL BY
JURY WOULD OTHERWISE ACCRUE. LANDLORD OR TENANT IS HEREBY AUTHORIZED TO FILE A
COPY OF THIS PARAGRAPH IN ANY PROCEEDING AS CONCLUSIVE EVIDENCE OF THIS WAIVER.
ARTICLE 16.00 OTHER PROVISIONS
16.01 TENANT FINISH ALLOWANCE FOR LANDLORD CONSTRUCTION OF LANDLORD
IMPROVEMENTS. Landlord shall provide Tenant an interior finish allowance (the
"Tenant Finish Allowance") of $$5.00 per square foot of the Leased Premises for
the Landlord Improvements. Upon, completion and approval by Landlord and Tenant
of the Plans in accordance with Section 6.01 hereof, Landlord shall price the
Plans at the best competitive prices available for projects of similar size,
location and timing. In the event the cost of the Landlord Improvements called
for by the Plans (including the reasonable cost associated with the preparation
of the Plans and Landlord's construction management fee) exceeds $$5.00 per
square foot of the Leased Premises, Landlord shall notify Tenant in writing, at
which point Tenant shall deposit the excess amount with Landlord, who in turn
shall deposit such amount into an interest bearing account with a national
financial association, selected by Landlord. All interest earned on such account
shall be for Tenant's benefit. Funds from this account shall be disbursed
exclusively for the Landlord Improvements, such disbursement to be commenced
once the cost of the Landlord Improvements as constructed have exceeded $$5.00
per square foot of the Leased Premises. Disbursements shall be made from time to
time but at least every two (2) weeks, based on the progress of the work as
certified by Landlord's architect, such certification to be in a form as may be
reasonably required by Landlord. To the extent that all funds in excess of
$$5.00 per square foot of the Leased Premises (including accrued interest
thereon) are not used for the Landlord Improvements, they shall be returned to
Tenant within thirty (30) days following completion of Landlord Improvements.
16.02 RENEWAL OPTION. Provided no Event of Default exists either on the
date Tenant gives Landlord the renewal notice required below or at the end of
the Term of this Lease, Tenant, but not any assignee or subtenant of Tenant,
shall have the right to renew this Lease for one (1) additional term of sixty
(60) months, upon the same terms and conditions contained in this Lease except:
(i) the renewal term will contain no further renewal options unless expressly
granted by Landlord in writing; and (ii) the Base Rent for the Leased Premises
shall be equal to the Base Rent for the last month of the Term times 1.15 (i.e.
115%).
If Tenant desires to renew this Lease, Tenant will notify Landlord by
written notice of its intention to renew not less than six (6) months prior to
the expiration date of the Term, time being of the essence. Once given, Tenant's
notice to renew shall be irrevocable. If Tenant fails to timely give said
notice, Tenant shall be deemed to have waived Tenant's option to renew. Upon the
valid exercise by Tenant of such option to renew, at the request of either party
hereto and within thirty (30) days after such request, Tenant and Landlord shall
enter into a written supplement to this Lease incorporating the terms,
conditions and provisions applicable to the renewal Term determined in
accordance with the provisions of this Section 16.02.
Page -22-
16.03 RIGHT OF FIRST REFUSAL ("ADJACENT SPACE"). Provided no Event of
Default exists on the date Landlord receives a third party offer, Landlord
hereby grants to Tenant, but not any assignee or subtenant of Tenant, a right of
first refusal during the initial Term (but not any renewal Term) to lease all or
any part (but in no event less than 6,000 square feet) of the 39,305 square feet
of vacant space in the Building immediately contiguous to the Leased Premises
and as shown on Exhibit "A" as the "Adjacent Space" (the "Adjacent Space"). If
Landlord receives an offer to lease any portion of the Adjacent Space from a
third party, Landlord shall notify Tenant in writing of its intention to accept
the Offer (the "Offer"). Tenant shall have five (5) business days from receipt
of such notice to notify Landlord in writing, of Tenant's intent to exercise its
right of first refusal with respect to the Adjacent Space which is the subject
of the Offer. If the terms of the Offer include space in addition to the
Adjacent Space, Tenant shall be required to lease all of such space if it
desires to lease the Adjacent Space. If Tenant does not exercise its right of
first refusal, then Landlord may lease such space to the third party, provided.
if the third party does not execute a lease or following execution of a lease
vacates the space subject to the Right of First Refusal, Tenant's Right of First
Refusal with respect thereto shall be reinstated.
If Tenant elects to exercise its Right of First Refusal to lease the
Adjacent Space which is the subject of the Offer, the terms for the lease of
such space shall be the same as the terms for the Leased Premises, with the
following exceptions: (i) there shall be no abated Base Rent; and (ii) if
Tenant's unencumbered cash and marketable securities are equal to two (2) times
the sum of (a) the tenant finish allowance that Tenant will receive as set forth
below, plus (b) the amount of commission Landlord will be obligated to pay for
Tenant's expansion into the Adjacent Space and Tenant has positive net income
for the six (6) month period immediately preceding Tenant's exercise, Tenant
shall be entitled to a tenant finish allowance as follows:
1. if the Right of First Refusal is exercised within the first twelve
(12) months of the Term, Tenant shall receive a tenant finish allowance equal to
$10.00 psf of the Adjacent Space, the improvements to, and use of such allowance
for the Adjacent Space to be in accordance with Sections 6.01 and 16.01; and
2. if the Right of First Refusal is exercised after the first twelve
(12) months of the Term, Tenant shall have the following options: (aa) receive a
tenant finish allowance equal to $10.00 psf multiplied by a fraction, the
numerator of which is the number of months remaining in the Term and the
denominator of which is 72, or (bb) receive a tenant finish allowance equal to
$10.00 psf and extend the Term for the entire Leased Premises for a period of
sixty (60) months, during which extended time Base Rent shall be equal to Base
Rent for the seventy second (72nd) month of the Term. In either event, the
improvements to, and use of the allowance for the Adjacent Space shall be in
accordance with Sections 6.01 and 16.01.
Within thirty (30) days from the date of Tenant's election to exercise
its right of first refusal, Tenant and Landlord will enter into a written
supplement to this Lease to add the Adjacent Space to the Leased Premises and to
modify Tenant's Pro Rata Share of Taxes and Insurance and Operating Expenses as
set forth in Section 2.04 and 2.05 hereof, otherwise Tenant's right of first
refusal shall terminate and Landlord may lease such space to any third party.
16.04 EXPANSION OPTION. Provided no Event of Default exists on the date
of exercise of such option, Landlord hereby grants to Tenant, but not any
assignee or subtenant of Tenant, an ongoing right to expand the Leased Premises
during the initial Term (but not any renewal Term) to include all or any part
(but in no event less than 6,000 square feet) of the 39,305 square feet of
vacant space in the Building immediately contiguous to the Leased Premises and
as shown on Exhibit "A" as the "Adjacent Space" (the "Expansion Space"). Tenant
shall notify Landlord in writing of Tenant's intent to exercise its expansion
option with respect to the portion of the Expansion Space specified therein.
If Tenant elects to exercise its expansion option to lease any such
applicable portion of the Expansion Space, the terms for the lease of such space
shall be the same as the terms for the Leased Premises, with the following
exceptions: (i) there shall be no abated Base Rent, and (ii) if Tenant's
unencumbered cash and marketable securities are equal to two (2) times the sum
of (a) the tenant finish allowance that Tenant will receive as set forth below,
plus (b) the amount of commission Landlord will be obligated to pay for Tenant's
expansion into the Adjacent Space, and (iii) that Tenant has positive net income
for the six (6) month period immediately preceding Tenant's exercise, Tenant
shall be entitled to a tenant finish allowance as follows:
1. if the expansion option is exercised within the first twelve (12)
months of the Term, Tenant shall receive a tenant finish allowance equal to
$10.00 psf of the applicable portion of the Expansion
Page -23-
Space, the improvements to, and use of such allowance for, the applicable
portion of the Expansion Space to be in accordance with Sections 6.01 and 16.01;
and
2. if the expansion option is exercised after the first twelve (12)
months of the Term, Tenant shall have the following options: (a) receive a
tenant finish allowance equal to $10.00 psf multiplied by a fraction, the
numerator of which is the number of months remaining in the Term and the
denominator of which is 72, or (bb) receive a tenant finish allowance equal to
$10.00 psf and extend the Term for the entire Leased Premises for a period of
sixty (60) months during which extended time Base Rent shall be equal to the
Base Rent for such seventy-second (72nd) month of the Term. In either event, the
improvements to, and use of the allowance for the Expansion Space shall be in
accordance with Sections 6.01 and 16.01.
Within thirty (30) days from the date of Tenant's election to exercise
its expansion option, Tenant and Landlord will use good faith efforts to enter
into a written supplement to this Lease to add the applicable portion of the
Expansion Space to the Leased Premises and to modify Tenant's Pro Rata Share of
Taxes and Insurance and Operating Expenses as set forth in Section 2.04 and 2.05
hereof.
16.05 EXISTING FURNITURE. Tenant may use the existing furniture listed
on Exhibit D attached hereto (the "Furniture") during the Term at no additional
cost. Tenant shall maintain the furniture in good condition and repair during
the Term. Provided no Event of Default exists at the end of the Term, Landlord
shall convey the Furniture to Tenant, without warranty.
Tenant shall be responsible for coordination of and all costs
associated with relocating any of the Furniture to allow contractors access to
complete the Landlord Improvements. Tenant shall also be responsible for
coordination of and all costs associated with setting up the Furniture after
construction is completed.
16.06 GENERATOR, UNINTERRUPTED POWER SUPPLY ("UPS"). Tenant
acknowledges that there is a Generator and UPS system serving the Leased
Premises and Adjacent Space (collectively the "Served Space") the Served Space
is connected to such Generator and UPS system. Tenant shall have the
non-exclusive right to the use of the Generator and UPS system, but acknowledges
that other tenants leasing space within the Adjacent Space will also have access
to use of the Generator and UPS system. Tenant shall, at its sole cost and
expense during the Term, maintain a regularly scheduled preventative
maintenance/service contract on the Generator and UPS system on an annual basis
with a maintenance contractor acceptable to Landlord, such contract to include
all services suggested by the equipment manufacturer. A copy of the service
contract shall be provided to Landlord within sixty (60) days following the
Commencement Date. In the event the service contract is not provided, then
Landlord shall have the right, but not the obligation to have the work done and
the cost therefor shall be charged to Tenant as Additional Rent and shall become
payable by Tenant with the payment of the rent next due hereunder. In the event
another tenant occupies space within the Adjacent Space, such tenant shall be
responsible for reimbursing Tenant for its pro rata share of the costs paid by
Tenant for maintaining the Generator and UPS system. Such pro rata share shall
be determined by multiplying Tenant's costs by a fraction, the numerator of
which is the number of square feet contained within such tenant's space and the
denominator of which is the number of square feet contained in the Served Space.
Tenant agrees to provide documentation to such tenant detailing its costs
associated with such maintenance. LANDLORD AGREES TO INCLUDE LANGUAGE IN ANY
LEASE FOR ANY OF THE ADJACENT SPACE OBLIGATING SUCH TENANT FOR ITS PRO RATA
SHARE OF THE COSTS ASSOCIATED WITH TENANT'S MAINTENANCE OF THE GENERATOR AND UPS
SYSTEM.
[Signature page follows]
Page -24-
ARTICLE 17.00 SIGNATURES / DATE OF EXECUTION
SIGNED this 9th day of April, 2004.
Landlord: Tenant:
VANTAGE DEVELOPMENT #21, INC. I-SECTOR CORPORATION
By: /s/ Xxxxxxxx X. Xxxxxxxx By: /s/ Xxxx X. Xxxx
------------------------------------- --------------------------------
Name: Xxxxxxxx X. Xxxxxxxx Name: Xxxx X. Xxxx
----------------------------------- ------------------------------
Title: President Title: President
---------------------------------- -----------------------------
Tenant Federal Employer
Identification Number:
00-0000000
-----------------------------------
Schedule I - Rules and Regulations
Exhibit A - Leased Premises
Exhibit B - Land
Exhibit C - Plans
Exhibit D - Furniture
Page -25-
Schedule I
RULES AND REGULATIONS
1. Landlord agrees to furnish Tenant all necessary initial keys and locks
without charge. Additional keys will be furnished at a nominal charge.
Tenant shall not change locks or install additional locks on doors
without prior written consent of Landlord. Tenant shall not make or
cause to be made duplicates of keys procured from Landlord without
prior approval of Landlord. All keys to Leased Premises shall be
surrendered to Landlord upon the expiration or earlier termination of
this Lease.
2. Tenant will refer all contractors, contractor's representatives and
installation technicians rendering any service on or to the Leased
Premises for Tenant to Landlord for Landlord's approval before
performance of any contractual service. Tenant's contractors and
installation technicians shall comply with Landlord's rules and
regulations pertaining to construction and installation. This provision
shall apply to all work performed on or about the Leased Premises or
Project, including installation of telephones, satellite equipment,
telegraph equipment, electrical devices and attachments and
installations of any nature affecting roofs, floors, walls, woodwork,
trim, windows, ceilings and equipment or any other physical portion of
the Leased Premises or Project.
3. Tenant shall not at any time occupy any part of the Leased Premises or
Project as sleeping or lodging quarters.
4. Tenant shall not place, install or operate on the Leased Premises or in
any part of the Building any engine, stove or machinery, or conduct
mechanical operations or xxxx thereon or therein (with the exception of
microwave ovens for preparation of meals during work hours), or place
or use in or about the Leased Premises or Project any explosives,
gasoline, kerosene, oil, acids, caustics, or any flammable, explosive
or hazardous material without written consent of Landlord.
5. Landlord will not be responsible for lost, stolen or damaged personal
property, equipment, money or jewelry from the Leased Premises or the
Project regardless of whether such loss occurs when the area is locked
against entry or not.
6. No dogs, cats, fowl, or other animals shall be brought into or kept in
or about the Leased Premises or Project.
7. Employees of Landlord shall not receive or carry messages for or to any
Tenant or other person or contract with or render free or paid services
to any Tenant or to any of Tenant's agents, employees or invitees.
8. None of the parking, truck courts or truck loading areas, recreation or
lawn areas, entries, exits, passages, doors, sidewalks, stairways or
landings shall be blocked or obstructed or any rubbish, litter, trash,
pallets, or material of any nature placed, emptied or thrown into these
areas or such area used by Tenant's agents, employees or invitees at
any time for purposes inconsistent with their designation by Landlord.
Unless provided by Landlord to the Project and as an operating expense
of the Project, it shall be the responsibility of Tenant, at its sole
cost and expense, to provide trash removal or dumpster service. All
dumpsters shall be placed in areas designated by Landlord.
9. The water closets and other water fixtures shall not be used for any
purpose other than those for which they were constructed, and any
damage resulting to them from misuse, including improper disposal of
any materials, or by the defacing or injury of any part of the Building
shall be borne by the person who shall occasion it. No person shall
waste water by interfering with the faucets or otherwise.
10. No person shall disturb occupants of the Building by the use of any
radios, record players, tape recorders, musical instruments, the making
of unseemly noises, the making of unnatural vibrations or any other
unreasonable use.
11. Tenant and its employees, agents and invitees shall park their vehicles
only in those parking areas designated by Landlord. Tenant shall not
leave any vehicle in a state of disrepair (including without
Page -26-
limitation, flat tires, out of date inspection stickers or license
plates) on the Leased Premises or Project. If Tenant or its employees,
agents or invitees park their vehicles in areas other than the
designated parking areas or leave any vehicle in a state of disrepair,
Landlord, (i) after giving written notice to Tenant of such violation
or (ii) placing notice of such violation on such vehicle, shall have
the right to remove such vehicles at Tenant's expense.
12. Parking in a parking area shall be in compliance with all parking rules
and regulations established by Landlord from time to time, including
any sticker or other identification system established by Landlord.
Failure to observe the rules and regulations shall subject the vehicle
in violation of the parking rules and regulations to removal. Removal
of a vehicle shall not create any liability on Landlord or be deemed to
interfere with Tenant's right to possession of its Leased Premises.
Vehicles must be parked entirely within the stall lines and all
directional signs, arrows and posted speed limits must be observed.
Parking is prohibited in areas not striped for parking, in aisles,
where "No Parking" signs are posted, on ramps, in cross hatched areas,
and in other areas as may be designated by Landlord. Every person is
required to park and lock his vehicle. All responsibility for damage to
vehicles or persons is assumed by the owner of the vehicle or its
driver. Servicing, repairing or washing vehicles in parking areas of
the Building or Project is prohibited.
13. Movement in or out of the Building of furniture or office supplies and
equipment, or dispatch or receipt by Tenant of any merchandise or
materials shall be done in such a manner as to not block or hinder the
flow of vehicular traffic throughout the Project or block or hinder the
access of any tenant into or out of the Building. Tenant assumes, and
shall indemnify Landlord against, all risks and claims of damage to
persons and properties arising in connection with any said movement.
14. Tenant shall not lay floor covering within the Leased Premises without
written approval of the Landlord. The use of cement or other similar
adhesive materials not easily removed with water is expressly
prohibited.
15. Tenant agrees to cooperate and assist Landlord in the prevention of
canvassing, soliciting and peddling within the Building or Project.
16. It is Landlord's desire to maintain in the Building or Project the
highest standard of dignity and good taste consistent with comfort and
convenience for Tenants. Any action or condition not meeting this high
standard should be reported directly to Landlord. Your cooperation will
be mutually beneficial and sincerely appreciated. Landlord reserves the
right to make such other and further reasonable rules and regulations
as in its judgment may from time to time be necessary, for the safety,
care and cleanliness of the Building or Project and for the
preservation of good order therein.
IN THE EVENT ANY OF THE TERMS OF THE RULES AND REGULATION CONFLICT WITH ANY OF
THE TERMS OF THE LEASE, THE TERMS OF THE LEASE SHALL CONTROL.
Page -27-
EXHIBIT "A"
LEASED PREMISES
(LEASED PREMISES FLOOR PLAN)
Page -28-
EXHIBIT "B"
LAND
BEING a 15.61 acre tract of land situated in the Xxxx Xxxxxxxxxx
Survey, Abstract No. 28 and the Xxxxxxx Xxxxx Survey. Abstract No. 335, Xxxxxx
County, Texas, said tract being all of Xxx 0 X-X, Xxxxx X, Xxxxxx' Xxxxx, Xxxxx
II, an addition to the City of Lewisville, Texas as recorded in Cabinet R, Page
000, Xxxx Xxxxxxx. Xxxxxx Xxxxxx. Xxxxx (P.R.D.C.T.), said tract being more
particularly described as follows:
BEGINNING at a found "X" cut at the northwesterly end of a corner clip
located at the intersection of the east right-of-way line of Lakeway Drive (60
feet wide) and the north right-of-way line of Lakepointe Drive (variable width);
THENCE North 02 degrees 31 minutes 51 seconds East, along said east
right-of-way line, a distance of 247.28 feet to a set "X" cut for corner:
THENCE North 36 degrees 33 minutes 00 seconds East, continuing along
said east right-of-way line, a distance of 24.13 feet to a ser. "X" cut for
corner;
THENCE North 02 degrees 31 minutes 51 seconds East, continuing along
said east right-of-way line, a distance of 45.00 feet to a set P.K. nail for
corner;
THENCE North 31 degrees 29 minutes 19 seconds West, continuing along
said east right-of-way line, a distance of 24.13 feet to a 1 /2-inch set iron
rod with a yellow plastic cap stamped "HALFF ASSOC. INC." (hereafter referred to
as "with cap") for corner;
THENCE North 02 degrees 31 minutes 51 seconds East. continuing along
said east right-of-way line, a distance of 327.23 feet to a 1/2-inch set iron
rod with cap for the point of curvature of a circular curve to the left having a
radius of 460.00 feet and whose chord bears North 03 degrees 08 minutes 13
seconds West, a distance of 90.86 feet:
THENCE Northerly, continuing along said east right-of-way line and
along said curve to the left, through a central angle of 1 I degrees 20 minutes
06 seconds, an arc distance of 91.00 feet to a 1 /2-inch set iron rod with cap
for corner;
THENCE North 81 degrees 49 minutes 13 seconds East, departing said east
right-of-way line, a distance of 50.84 feet to a 1,/2-inch found iron rod with
cap for the point of curvature of a circular curve to the left having a radius
of 385.00 feet and whose chord bears North 69 degrees 26 minutes 14 seconds
East, a distance of 165.12 feet:
THENCE Northeasterly, along said curve to the left, through a central
angle of 24 degrees 45 minutes 57 seconds, an arc distance of 166.42 feet to a
1/2-inch found iron rod with cap for the point of tangency;
THENCE North 57 degrees 03 minutes 15 seconds East. a distance of
375.38 feet to a 1/2-inch set iron rod with cap for corner on the west line of
Xxx 0, Xxxxx X. Xxxxxx' Xxxxx Xxxxx 00, an addition to the City of Lewisville,
Texas recorded in Cabinet N, Pages 298-303, P.R.D.C.T.;
THENCE South 35 degrees 07 minutes 20 seconds East, along the common
line between said Lots 1R-A and 2, a distance of 384. 36 feet to a 1/2-inch
found iron rod with cap for the point of curvature of a circular curve to the
left having a radius of 609.86 feet whose chord bears South 47 degrees 09
minutes 33 seconds East, a distance of 254.36 feet;
THENCE Southeasterly. continuing along said common line and along said
curve to the left, through a central angle of 24 degrees 04 minutes 26 seconds,
an arc distance of 256.24 feet to a 1/2-inch set iron rod with cap for corner;
Page -29-
THENCE South 37 degrees 36 minutes 28 seconds West, departing said
common line, a distance of 208.19 feet to a 1/2-inch found iron rod with cap for
the point of curvature of a circular curve to the left having a radius of 427.75
feet whose chord bears South 18 degrees 54 minutes 50 seconds West, a distance
of 274.20 feet;
THENCE Southwesterly, along said curve to the left, through a central
angle of 37 degrees 23 minutes 16 seconds, an arc distance. of 279.12 feet to a
1/2-inch found iron rod with cap for the point of tangency;
THENCE South 00 degrees 13 minutes 12 seconds West, a distance of
102.70 feet to a found "X" cut for corner on the north right-of-way line of the
aforementioned Lakepointe Drive;
THENCE South 89 degrees 31 minutes 42 seconds West, along said north
right-of-way line, a distance of 29.51 feet to a set "X" cut for the point of
curvature of a circular curve to the left having a radius of 1157.00 feet whose
chord bears South 89 degrees 57 minutes 22 seconds West, a distance of 23.30
feet;
THENCE Southwesterly, along said curve to the left, through a central
angle of 01 degree 09 minutes 14 seconds, an arc distance of 23.30 feet to a set
60-D nail for the point of tangency;
THENCE South 89 degrees 16 minutes 48 seconds West, continuing along
said north right-of-way line, a distance of 67.10 feet to a 1/2-inch found iron
rod with cap for corner;
THENCE South 44 degrees 33 minutes 01 second West, continuing along
said north right-of-way line, a distance of 17.03 feet to a 1/2-inch found iron
rod with cap for corner;
THENCE South 89 degrees 23 minutes 06 seconds West, continuing along
said north right-of-way line. a distance of 589.24 feet to a found "X" cut for
the southeasterly end of a corner clip located at the intersection of the east
right-of-way line of said Lakeway Drive and the north right-of-way line of said
Lakepointe Drive;
THENCE North 43 degrees 48 minutes 57 seconds West, departing said
north right-of-way line and along said corner clip a distance of 20.73 feet to
the POINT OF BEGINNING AND CONTAINING 680,177 square feet or 15.61 acres of
land, more or less.
Page -30-
Exhibit "C"
PLANS
(CEILING PROPOSED FLOOR PLAN)
Page -31-
(DEMO CEILING FLOOR PLAN)
Page -32-
(DEMO FLOOR PLAN)
Page -00-
(XXXXX XXXX XXXXX XXXX)
Page -34-
(CEILING PROPOSED FLOOR PLAN)
Page -35-
EXHIBIT "D"
FURNITURE INVENTORY
QTY DESCRIPTION
--- -----------
45 Xxxxxx Xxxxxx workstations (cubes) - one from south end of vacancy
43 High-back leather conference/desk chairs (black)
142 File cabinets for cubes (black)
3 High-back leather chairs with round base (black)
5 Low-back leather chairs - secretary type (black)
21 Low-back fabric chairs - secretary type (black); 4 non-rolling, 17 on wheels
50 Fabric chairs on wheels (green)
14 File cabinet (5-drawer)
1 Conference table (13 foot)
1 Conference table (8 foot)
1 Conference table (10 foot)
1 Ice maker
3 Lamps
2 Leather club chairs
1 Leather couch
2 Coffee tables - glass
1 Tall table - glass
Page -36-
