January 25, 1999
LEASE
This Lease ("Lease") is entered into by CLAY DEVELOPMENT & CONSTRUCTION,
INC., as "Landlord," a Texas corporation, or its assigns, and HORIZON HIGH
REACH, INC., as "Tenant," a _________corporation.
I. BUSINESS TERMS AND AGREED DEFINITIONS
A. Building. The building to be built pursuant to this Lease on the land
(the "Land") described on Exhibit "A", which is attached hereto and made a
part hereof; and the parking/drives/storage area (if any), shown on the
plot plan attached as Exhibit "B", which services the Building. The
Building will be located in the location shown on Exhibit "B" which is
attached hereto and made a part hereof with minor variances which commonly
occur in connection with layouts of buildings and/or the pouring of
foundations, as more particularly described in Article II.B. The Building
shall contain approximately 15,000 square feet of roofed and covered floor
area ("Estimated Footage").
B. Leased Premises.. The Building (as described on Exhibit "B" and
Exhibits "C" and "G" attached hereto and made a part hereof) and the Land
described on Exhibit "A" together with any other improvements situated
thereon.
C. Commencement Date.. The Commencement Date shall be the earliest to
occur of: (i.) the "Tender Date," as defined in Article III below; or
(ii.) the date upon which Tenant commences the operation of its business in
the Leased Premises.
D. Term. The period that begins on the Tender Date and ends on the last
day of the Sixtieth (60th) full calendar month following the Commencement
Date, unless sooner terminated in accordance with the provisions of this
Lease or extended by exercise of the "Renewal Options" (hereafter defined).
E. Base Rent (Annual and Monthly).
Annual Base Rent Estimated Total
(per square foot of Monthly Base Rent
Floor Area in the Based Upon
Period Leased Premises) Estimated Footage
(i) Commencement $ 4.81 $ 6,010.25
Date thru the 30th
full calendar month
following the
Commencement Date
(ii)The first day of the $ 5.05 $ 6,310.75
31st full calendar
month following the
Commencement Date
thru the 60th full
calendar month
following the
Commencement Date
F. Security Deposit.. The sum sixty-three thousand dollars ($63,000.00)
cash, which shall be deposited with the Title Company closing the land not
later than two (2) business days after request that such Security Deposit be
delivered in escrow to the Title Company for delivery to Landlord at the
closing of the purchase of the Land. It is contemplated that the Security
Deposit will be required to be delivered at least one (1) business day prior
to the closing of the purchase of the Land. Within thirty (30) days after
the Tender Date, provided Tenant is not in default hereunder, the sum
thirty-four thousand ninety-five & 50/100 dollars ($34,025.50) shall be
returned to Tenant by Landlord. Seven thousand eighteen & 25/100 dollars ($
7,018.25) shall be applied to the first month's rent. The balance of the
Security Deposit, twenty-one thousand, nine hundred fifty-six & 25/100
dollars ($21,956.25), shall be held in accordance with this Lease and, if
not used pursuant to the terms of this Lease, returned to the Tenant within
30 days of written request after the term and renewals of this Lease.
G. Initial Estimate of Monthly Taxes and Insurance Payment. One thousand
eight & 00/100 ($ 1,008.00)
H. Permitted Use. Any lawful purpose except that Tenant may not use the
Leased Premises or any portion thereof for any of the uses described on
Exhibit "I" ("Prohibited Uses").
I. Tenant's Address. Before the Building is substantially complete,
Tenant's address is 0000 X Xxxxxx Xx., Xxxxxxx, XX 00000; Tenant's address
after the Building is substantially complete shall be the address of the
Leased Premises.
J. Commissions. Landlord shall be responsible for and shall pay the real
estate commission due to Xxxxxxxx Xxxxxx Real Estate Group. ("Broker"), in
accordance with the terms set forth in a separate agreement entered into
between Landlord and Broker.
K. Landlord's Address.. 00000 Xxxxxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxx
00000, 713/789.2529.
L. List of Exhibits..
Exhibit "A": Legal Description of Land
Exhibit "B": . Plot Plan showing location of the Leased Premises
Exhibit "C": Proposed Specification - Landlord's Work
Exhibit "D": Notable Pipelines, Easements, and other Impediments to the
Land
Exhibit "E": Estoppel Certificate
Exhibit "F": Rules & Regulations
Exhibit "G": Office Space Floor Plan
Exhibit "H": Hazardous Substances Provisions
Exhibit "I": Prohibited Uses
Exhibit "J": Change Order Form
Exhibit "K": Omitted
M. Projected Completion Date.. Six (6) months after issuance of the
Building Permit to Landlord. If Landlord has not Substantially Completed
the Building within eight (8) months after issuance of Building Permit, then
Tenant shall receive one (1) day of free base rent for each day of delay.
In the event of any conflict between any summary of Lease provisions
described in this Article I, on the one hand, and the balance of this Lease
on the other hand, the latter shall control.
II. Acquisition of Land and Leased Premises.
A. It is acknowledged that Landlord currently does not own the Land
and is attempting to acquire the Land from a third party. Tenant shall
deposit the Security Deposit with the Title Company pursuant to Article I.F
for delivery to Landlord at the Closing of the purchase of the land. In the
event that Tenant shall fail to timely deposit the Security Deposit, such
delay shall be considered as a "Tenant Delay" as defined in Subparagraph
B(1), below. In the event that the Land is not acquired by Landlord prior
to April 1, 1999, then either party may terminate this Agreement by giving
written notice thereof to the other at any time prior to acquisition of the
Land. In the event of such a termination, neither party shall have any
liability to the other under this Lease.
When construction of the Leased Premises is Substantially Completed (as
hereinafter defined), Landlord's architect shall certify, in writing, the
number of square feet of roofed floor area of the Building (measurements
will be made from inside the shell wall to inside the shell wall ), which
certified number of square feet shall be used as the number of square feet
of floor area in the Building for all purposes. In the event that the
number of square feet of floor area in the Building shall decrease from the
Estimated Footage by more than 500 square feet, there shall be an adjustment
to the Base Rent calculated by multiplying the Base Rent times a fraction,
the numerator of which is 15,000 square feet less the actual number of
square feet and the denominator of which is 15,000 square feet, and
subtracting such amount from the monthly Base Rent. Landlord hereby leases
the Leased Premises to Tenant and Tenant hereby leases the Leased Premises
from Landlord. The Leased Premises shall be leased by Landlord to Tenant in
their existing condition and state of repair, on an "AS-IS," "WHERE-IS"
basis once Landlord has completed the construction work described in the
"Plans" (hereafter defined) and, except as set forth in the Plans and for
Landlord's completion of punchlist items, Landlord shall have no obligation
to perform any additional construction work at the Leased Premises.
Landlord will, however, be responsible for Landlord's repair obligations
described in Article X and any warranty work relating to such items and
Construction Warrantees outlined below.
B. Landlord agrees to prepare the Leased Premises for occupancy by Tenant
substantially in accordance with the following terms and conditions:
(1) Landlord, at Landlord's sole cost and expense,
shall perform the construction and other work in and on the
Leased Premises (hereinafter called the "Landlord's Work")
which is provided for in the plans and specifications (the
"Preliminary Plans") described in Exhibit "C" attached hereto,
which Preliminary Plans have been initialed by Landlord and
Tenant. The Preliminary Plans consist of a floor plan for the
office space (Exhibit "G"), an elevation of the Building
(Exhibit "B") and specifications for the Building. The plot
plan showing the preliminary location of the Building on the
Land is attached hereto as Exhibit "B", which location may be
changed by the Landlord based upon the requirements of any
easements, governmental requirements and good construction
practice, including the topography of the Land. However, the
Building shall be located such that no other structure or
building will be constructed on the Land so as to interfere
with the freeway frontage of the Building. More detailed
plans ("Detailed Plans") will be prepared by the Landlord, at
the Landlord's expense, covering the Landlord's Work, and such
Detailed Plans shall be submitted to the Tenant for Tenant's
approval, which approval shall not be unreasonably withheld or
delayed, as long as such Detailed Plans are consistent, in all
material respects, with the Preliminary Plans. If Tenant fails
or refuses to approve or disapprove the Detailed Plans within
ten (10) business days following receipt of the Detailed Plans,
Tenant will be deemed to have approved the Detailed Plans. The
Detailed Plans which are approved by Landlord and Tenant, by
initialing, shall become the "Plans" for all purposes of this
Lease.
Subject to the provisions of this Article II, Landlord shall proceed
diligently to cause the Landlord's Work and "Additional Work"
(hereafter defined) to be Substantially Completed on or before the
Projected Completion Date. The Projected Completion Date shall be
extended by each day of delay caused by an act of God or force majeure
(as defined in Article XXIII.O below) or by Tenant Delays (hereinafter
collectively referred to as "Excusable Delays"). Landlord may extend
the Projected Completion Date by reason of such events only if Landlord
advises Tenant in writing within fifteen (15) business days after an
aggregate of ten (10) business days of Excusable Delays have occurred
since the last such notice. "Substantial Completion" shall mean (and
the Leased Premises shall be deemed "Substantially Completed") when the
Landlord's Work and any Additional Work described in the Plans has
occurred such that the Leased Premises are ready for occupancy by
Tenant for general office/warehouse purposes with only minor punchlist
items to be completed.. Substantial Completion shall be deemed to have
occurred notwithstanding a requirement to complete "punchlist items" or
similar corrective work which does not materially interfere with
Tenant's occupancy. Landlord shall give Tenant notice fifteen (15)
business days prior to the date that Landlord believes that the Leased
Premises will be Substantially Complete and shall allow Tenant access
to the Leased Premises two weeks prior to the date of Substantial
Completion for Tenant to install various equipment and machinery;
provided, however, that in doing so Tenant shall coordinate and
cooperate with Landlord and Landlord's contractors to prevent any
delay. Tenant shall have no right to occupy the Leased Premises prior
to the date of Substantial Completion. Within five (5) business days
after the date that Landlord has notified Tenant of Substantial
Completion, with the exception of the placement of a temporary facility
and adequate insurance in place per Article XIII. Landlord and Tenant
shall walk through the Building and prepare a punchlist of items
needing completion and/or repair, which items shall be completed by
Landlord within thirty (30) days after the date that the punchlist is
completed, Should Tenant not agree that Substantial Completion has
occurred, Landlord's architect shall resolve such dispute by certifying
in writing whether Substantial Completion has occurred and, if not,
what is required to be completed for Substantial Completion to occur.
Landlord shall notify Tenant in writing when Landlord believes that
the punchlist items have been completed. Within five (5) business
days after the date that Landlord has notified Tenant that the
punchlist items have been completed, Landlord and Tenant shall walk
through the Building to confirm that the punchlist items have in
fact been completed.
Landlord shall be responsible for obtaining, if available, a temporary
or conditional certificate of occupancy or equivalent certificate from
the applicable governmental agency (collectively, the "Certificate of
Occupancy") so that Tenant may occupy the Building. If requested by
Landlord, Tenant will assist Landlord in obtaining such Certificate of
Occupancy. Since the final Certificate of Occupancy ("Final
Certificate of Occupancy") will not be issued until Tenant has
completed the installation of its furniture, fixtures, equipment and
other items, Tenant shall be responsible for obtaining the Final
Certificate of Occupancy (or equivalent certificate from the applicable
governmental agency). Landlord will assist Tenant in obtaining such
Final Certificate of Occupancy, including without limitation, promptly
correcting any deficiencies in the Work and/or Additional Work required
by the governmental authorities as a condition to issuing the Final
Certificate of Occupancy.
(2) If Tenant hereafter desires Landlord to do different work
or any work in excess of the Landlord's Work ("Additional Work") in or
on the Leased Premises above and beyond the Landlord's Work to be
performed by Landlord pursuant to the Plans (Exhibit "C"), Tenant shall
submit to Landlord detailed proposed plans of such Additional Work.
Such proposed plans shall be subject to Landlord's approval, which
approval shall not be unreasonably withheld, and if Landlord does not
approve such proposed plans pursuant to its right to do so, Landlord
shall have no obligation whatsoever to perform any Additional Work. If
Landlord does approve such proposed plans, Landlord's obligation to
perform the Additional Work shall be conditioned upon Landlord and
Tenant having mutually agreed in writing as to the cost of the
Additional Work to be paid by Tenant, who will bear the cost and when
such cost will be paid for such Additional Work. It is understood that
Landlord may progress xxxx Tenant for such Additional Work on a monthly
basis as such Additional Work is performed. Landlord shall have no
obligation to perform any Additional Work or make any change orders
unless Tenant shall execute within five (5) business days after receipt
from Landlord a written change order in the form attached hereto as
Exhibit "J" covering such work.
(3) All Landlord's Work and Additional Work required or
permitted by this Lease shall be done by Landlord in a good and
workmanlike manner substantially in accordance with the Plans.
Landlord shall, before performing such Landlord's Work, at its
own expense, obtain all building permits, approvals and
certificates required by any governmental authority required
for the Work and shall, upon request of Tenant, promptly
deliver copies of same to Tenant. Landlord will cause
Landlord's contractors and subcontractors to carry such
insurance as Landlord (in its discretion) may reasonably
require.
(4) If Landlord shall not be able, by the use of
reasonable efforts and means, to obtain all requisite
governmental, quasi-governmental, regulatory authority, and
other permits, licenses, consents, and permissions relating to
Landlord's construction with respect to the Leased Premises or
any other requisite consent in connection with such
construction, if any, then in any of the aforesaid
circumstances, Landlord may terminate this Lease at any time
prior to the issuance of a Building Permit by giving Tenant
written notice thereof provided Landlord shall have first given
Tenant notice that it has been unable to obtain the requisite
governmental, quasi-governmental regulatory authority, or other
permits, licenses, contracts or permissions relating to
Landlord's construction on the Land and allow Tenant thirty
(30) days to obtain the same. Upon such termination, this
Lease will be of no further force or effect, and neither party
will have any further obligation or liability hereunder, except
to enter into the Mutual Release Agreement and to return the
full amount of the Security Deposit to Tenant as referred to in
Article I.F. No expenditure by Tenant or incurring of any
liability for merchandise, fixtures, equipment, or labor or
material or otherwise shall alter or affect the rights of
Tenant and Landlord hereunder.
(5) Landlord shall provide (or cause the Contractor
[if different from the Landlord] to provide) Tenant with a one
(1) year construction warranty covering all of the Work with
respect to the Building other than "Structural Members" (
hereinafter defined). Landlord will be responsible for
maintaining structural members as provided for in Article X.A
of this lease.
Landlord will cause the architect's agreement, structural
engineering and mechanical, electrical and plumbing engineering
agreements to be assigned to the successor owner of the Project and
Tenant upon final completion of the Building. Following Landlord's
completion of the Landlord's Work and Additional Work and any punchlist
items, Landlord shall have no responsibility for any design defects,
and the successor owner, if any, and Tenant agree to look solely to the
Landlord's architect and engineers in the event of any design defects.
(6) Landlord shall allow Tenant and Tenant's agents and
representatives reasonable access to the Leased Premises, at their sole
risk, throughout the period of construction. Upon request from Tenant,
Landlord will furnish Tenant with copies of tests and inspections of
the Landlord's Work performed by Landlord.
(7) Landlord agrees that all materials and equipment
incorporated in the Project will be new unless otherwise specified and
that all Landlord's Work and Additional Work will be of good quality
and in conformance with the Plans and completed in a good and
workmanlike manner. Landlord agrees that upon completion of the
Project, the Project and the Landlord's Work and Additional Work will
comply with all applicable building codes. Landlord shall give (or
cause the Contractor [if different from the Landlord] to give) all
notices and comply with all laws, ordinances, rules, regulations and
lawful orders of any public authority having jurisdiction over the
construction of the Project.
(8) At or before Substantial Completion, Landlord shall remove
all his waste materials and rubbish from and about the Leased Premises
as well as Landlord's tools, construction equipment, machinery and
surplus materials.
(9) The Landlord shall (or cause the Contractor to) maintain
in good order at the site one record copy of drawings, specifications,
product data, samples, shop drawings, change orders and other
modifications, marked currently to record changes made during
construction, and Tenant shall have reasonable access to such items.
These items shall be delivered to the Tenant upon completion of the
construction.
(10) To the fullest extent permitted by law, Landlord shall
indemnify, defend and hold harmless the Tenant and its agents, from and
against claims, damages, losses and expenses, including, but not
limited to, reasonable attorney's fees arising out of or resulting from
the performance of the Landlord's Work and Additional Work which accrue
prior to the Tender Date, provided that such claim, damage, loss or
expense is attributable to bodily injury, sickness, disease or death,
or to injury to or destruction of tangible property (other than the
Building itself), including loss of use resulting therefrom, caused by
Landlord, any contractor or subcontractor, or by anyone for whose acts
Landlord may be liable, except damage and loss attributable in whole or
in part to the acts or omissions of Tenant
(11) Landlord shall promptly correct or cause the Contractor to
promptly correct any Landlord's Work and Additional Work reasonably
rejected by Tenant as defective or as failing to conform to the Plans,
whether observed before or after the Tender Date, but not later than
one (1) year after the Tender Date (except for Landlord's repair
obligations outlined in Article X), and also shall correct any
Landlord's Work and Additional Work found to be defective or
nonconforming by Tenant within said one (1) year period (or thereafter
pursuant to Landlord's repair obligations outlined in Article X). In
each case that Landlord has the obligation to cause the Contractor to
perform warranty work, Landlord and Contractor shall be notified of the
Landlord's Work and Additional Work found to be defective or
nonconforming not later than one (1) year after the Tender Date;
otherwise, neither Landlord nor Contractor shall have any
responsibility for the correction of such warranty items but Landlord
shall remain liable for Landlord's repair obligations outlined in
Article X. The provisions of this Subparagraph 11 apply to work done
by subcontractors as well as to work done by direct employees of
Landlord.
(12) Except as otherwise expressly provided in this Lease with
respect to the Structural Warranty pertaining to the roof, foundation
and load-bearing walls supporting the roof of the Building, Landlord
shall have no responsibility for enforcing any construction warranties
after one (1) year, such right and responsibility having been assigned
to Tenant.
C. Landlord reserves the right to place utility lines over and
under the Land, so long as the same are around the perimeter of the Land
(but not in front of the Building) and do not unreasonably interfere with
Tenant's use of the Leased Premises. Tenant may not construct any
alterations or make any changes to the Leased Premises unless Tenant has
received the prior written consent of Landlord, which consent shall not be
reasonably withheld. Tenant shall have no authority to place any lien upon
the Leased Premises and any attempt to do so shall be void from its
inception and of no force or effect. All improvements, additions,
equipment, and fixtures installed in the Leased Premises except for
Removable Trade Fixtures (as defined in Article X.B below which are actually
removed in accordance with Article X.B), at the termination of Tenant's
right to possession hereunder shall belong to Landlord.
III. Tender Date and Conditions. Landlord will tender possession of the
Leased Premises to Tenant by giving Tenant a set of keys to the Leased
Premises. The latest to occur of the dates on which Landlord has (i)
Substantially Completed Landlord's Work (as defined in Article II.B(1)
above), (ii) given Tenant the keys to the Leased Premises and (iii) obtained
a temporary or conditional Certificate of Occupancy, if applicable, shall
constitute the "Tender Date."
IV. Rent. All sums required to be paid by Tenant under this Lease
constitute "rent." The term "rent" or "rental", when used in this
instrument, includes Base Rent and all other sums payable hereunder.
Tenant's rent payments shall be made to Landlord at Landlord's address
stated above, or at any other address that Landlord may specify. Landlord
shall provide Tenant written notice of any change of address at least thirty
(30) business days prior to the due date of any rent payments to be made at
any address other than that stated above. No payment made by Tenant or
received by Landlord in an amount less than the amount herein stipulated
shall be deemed to be other than a partial payment, nor shall any
endorsement or statement on any check or any letter accompanying any check
or payment as rent or any other sum payable hereunder be deemed an accord
and satisfaction, and Landlord may accept any such check or payment without
prejudice to Landlord's right to recover the balance of such amount from
Tenant or to pursue any other remedy in this Lease or by law provided.
Beginning with the Commencement Date and continuing thereafter until the
expiration of the Term (as the same may be extended), Tenant agrees to pay
Landlord the Base Rent provided above in advance, without notice or demand,
every month during the Term of this Lease. If any monthly Base Rent
payment is not received by Landlord by the first day of the month in which
such rent payment was due, Tenant shall pay, as additional rent, $25 for
each day such payment is late, and such late charge shall be due upon
receipt of Landlord's written demand. Notwithstanding the foregoing
sentence, three (3) times in any twelve (12) consecutive months Tenant
shall not be required to pay $25.00 for the first two (2) days that a
payment is late. However, the $25.00 payment shall apply after the first
two (2) days in all circumstances and shall apply after three (3) notices
have been given in any calendar year. Tenant shall also pay to Landlord,
upon demand, $100.00 for each check tendered to Landlord in payment of rent
or any other payment due Landlord hereunder, which is returned
uncollectible to Landlord. All Base Rent shall be prorated for any partial
month.
V. Taxes and Insurance.
A Tenant's Obligation. Tenant shall pay to Landlord:
1. an amount equal to all real estate taxes and assessments
that are levied or assessed or which accrue against the
Leased Premises by any governmental authority during the
Term and other governmental charges whether federal,
state, county, or municipal, and whether by taking
districts or authorities presently taxing the Leased
Premises or by others, subsequently created or otherwise,
and any other taxes and assessments attributable to the
Leased Premises and shall include without limitation, any
taxes imposed on Landlord (whether a capital levy or
otherwise) directly on the rents received or any other tax
directly on the rents received therefrom and/or franchise
tax, assessment, levy or charge measured by or based in
whole or in part, upon rents from any portion of the
Leased Premises, and its operation excluding, however,
state and federal taxes on income ("Taxes").
2. an amount equal to the insurance premiums that
are charged to Landlord for all policies of insurance
carried by Landlord that provide coverage to the Leased
Premises, including any all-risk or fire and extended
coverage policies, public liability and property damage
policies, and rent insurance policies ("Insurance
Premiums"). Landlord shall carry casualty insurance in an
amount not less than the greater of: (i) $1.5 million
dollars, if available, and (ii) eighty-five percent (85%)
of the replacement cost of the Building.
B. Payment. Taxes and Insurance Premiums shall be payable in equal
monthly installments, in addition to and along with and shall be due on the
same dates as Tenant's monthly payment of Base Rent. Each monthly
installment of Taxes and Insurance Premiums shall be estimated by Landlord
based on Landlord's estimate of the total annual charge for Taxes and
Insurance Premiums accruing during the year in question. Landlord's estimate
of the monthly charge for Taxes and Insurance Premiums for the calendar year
in which the year commences is the Initial Estimate of Monthly Taxes and
Insurance Payments (as defined in Article I.G). Notwithstanding the
foregoing sentence, each monthly installment of taxes and insurance premiums
as estimated by Landlord shall not exceed ten percent (10%) of the prior
years' insurance and taxes unless Landlord shall provide Tenant with
evidence of a reasonable likelihood of an increase in taxes or insurance in
excess of such ten percent (10%) which evidence may include the opinion of
tax consultants and insurance consultants. Landlord shall reconcile the
payments received from Tenant under this Paragraph B against the actual
amount of Taxes and Insurance Premiums within three months following the end
of each calendar year of this Lease. Landlord shall pay to Tenant within
thirty (30) days of such reconciliation any overpayment received from
Tenant and Tenant shall pay to Landlord for any deficiency within thirty
(30) days following receipt of an invoice from Landlord. Additionally,
Tenant shall pay the full amount of all taxes, assessments, impositions,
levies, charges, excises, fees, licenses and other sums levied, assessed,
charged or imposed by any governmental authority or other taxing authority
upon Tenant's leasehold interest under this Lease and all alterations,
additions, fixtures (including Removable Trade Fixtures [hereafter
defined]), inventory and other property installed or placed or permitted at
the Leased Premises by Tenant. Within thirty (30) days after notice from
Landlord, Tenant shall furnish Landlord a true copy of receipts evidencing
such payment received by Tenant from the governmental authority or other
taxing authority assessing such charges. Landlord shall allow Tenant to
contest any taxes, assessments, impositions, levies, charges, excise fees,
licenses, or other sums levied or assessed, charged or imposed by any
governmental authority or taxing authority upon the Leased Premises provided
the same shall be done at no cost or liability to Landlord and provided that
any such contesting shall in no way affect or delay Tenant's liability
hereunder to Landlord for Taxes.
VI. Security Deposit. Tenant shall deposit the Security Deposit with the
Title Company for delivery to Landlord simultaneously with Landlord's
acquisition of the Land and to secure Tenant's faithful performance of all
of Tenant's obligations under this Lease, as described in Article I.F. The
Security Deposit shall be retained by Landlord throughout the Term of this
Lease, except to the extent required to be refunded to Tenant in accordance
with Article I.F of this Lease. Tenant agrees that if it should fail to
pay rent when it is due, the Security Deposit may be applied by Landlord to
the unpaid rent. Also, if Tenant fails to comply with any of the other
obligations of Tenant under the Lease, Landlord may apply the Security
Deposit to reasonable damages suffered by Landlord resulting solely from
Tenant's noncompliance. Landlord shall not be obligated to apply the
Security Deposit in the manner stated above, but may do so in addition to
pursuing any of the other remedies available to Landlord under the Lease and
the law on account of Tenant's noncompliance with Tenant's obligations. If
Landlord should apply some or all of the Security Deposit to reasonable
damages suffered by Landlord resulting solely from Tenant's noncompliance
with its obligations, Tenant agrees to restore the Security Deposit upon
receipt of Landlord's written demand and Landlord's written explanation of
such damages. No interest shall accrue on the Security Deposit. Landlord
may commingle the Security Deposit with other funds. If Tenant complies
with all of Tenant's obligations, the Security Deposit shall be returned to
Tenant within 30 days after the end of the Term, less any amounts that may
then be due from Tenant to Landlord as set forth in an itemized list to be
provided by Landlord describing the reasons for withholding any portion of
the Security Deposit.
VII. Utilities. Tenant shall contract directly with utility providers
and shall pay for all water, sewer, gas, electricity, telephone and other
utilities used in the Leased Premises during the Term and shall hold
harmless Landlord from such charges. Landlord shall not be liable for any
cessation or interruption of utility services to the Leased Premises. No
cessation or interruption of utilities shall modify any of the obligations
of Landlord or Tenant under this Lease.
VIII. Use. Tenant shall use the Leased Premises solely for the Permitted
Use, as defined herein. Tenant shall not use the Leased Premises, or permit
their use, for any other purpose or any Prohibited Use described in
Exhibit I.. Tenant shall obtain, at its own cost and expense, any and all
licenses and permits necessary for such use. Tenant shall comply with all
restrictions and easements applicable to the Leased Premises and with all
federal, state, municipal, and other laws, ordinances, rules and regulations
of any governmental authority that apply to the use, construction,
renovation, repair, operation, or occupancy of the Leased Premises or to
Tenant's business, or which pertain to health or the environment. Tenant
acknowledges that there may be schools and churches in the vicinity of the
Leased Premises and that their presence may impose special laws, ordinances,
rules, regulations and the like on Tenant's operations within the Leased
Premises, and, without limiting the generality of the preceding sentences of
this Article, Tenant agrees, in the operation of its business in the Leased
Premises, to comply with all such laws, ordinances, rules, regulations, and
the like. Outside storage, other than within fenced areas, is prohibited
without Landlord's prior written consent. Tenant shall install, remove and
alter the fixtures, equipment and facilities located in the Leased Premises
and shall pay the cost of alterations to the Leased Premises that may be
required to comply with all such restrictions, easements, laws, ordinances,
rules and regulations. Without limiting the generality of the foregoing,
Tenant shall fully comply with the provisions relating to "Hazardous
Substances" set forth in Exhibit "H" and Prohibited Uses set forth in
Exhibit "I".. Tenant shall not engage in any activity or permit any nature
of construction by Tenant or any other condition at the Leased Premises
which would cause Landlord's fire and extended coverage insurance to be
canceled, or the rate therefor increased or cause the disallowance of any
sprinkler credits, if the Building is sprinklered. Tenant shall comply with
such safety recommendations and reasonable loss prevention and loss
reduction recommendations as Landlord or Landlord's insurance carriers (or
both) may, from time to time, request and Tenant shall not make any unlawful
use of the Leased Premises or permit any unlawful use thereof; and Tenant
shall not commit any act which is a significant nuisance or annoyance to
Landlord or to other tenants, or which might, in the good faith business
judgment of Landlord, injure or depreciate the Leased Premises.
IX. Signs. Tenant shall be responsible for the purchase, installation,
and maintenance (in accordance with standards determined by Landlord from
time to time) of any sign in the Leased Premises or on the exterior of the
Leased Premises; provided, Tenant shall not install or maintain any sign on
the exterior of the Leased Premises, or which may be viewed from the outside
of the Leased Premises, without first obtaining Landlord's written consent
which shall not be unreasonably withheld. Any sign erected upon the Leased
Premises must advertise and relate to occupants of the Leased Premises and
not any other parties. Tenant shall be responsible for the removal of all
signs upon termination of Tenant's rights to possession hereunder and all
installations and removal of signs shall be made in such a manner as to
avoid injury or defacement of any building or other improvement and Tenant
shall be responsible for repair of any injury or defacement (including
without limitation, discoloration caused by such installation and/or
removal); or receive Landlord's written permission to leave the sign in
place.
X. Repairs.
A. Landlord's Obligations. Only the following portions of
the Leased Premises constitute Landlord's repair obligation: roof,
foundation, and load-bearing walls supporting the roof of the Building
("Structural Members"). These items will be maintained in good condition
and repair at Landlords' sole cost and expense. Landlord shall have no
obligation to perform repair or maintenance activities with regard to such
portions of the Leased Premises, unless and until Tenant has given Landlord
reasonable written notice of need of repair to these items and a reasonable
time has passed for Landlord to commence appropriate repair or maintenance
activities. Subject to the waiver of subrogation provision in Article XIII,
Landlord's obligations under this Paragraph A shall not be applicable to any
damage caused by the negligence or willful misconduct of Tenant or Tenant's
employees, agents or invitees, or caused by Tenant's default hereunder; and
Tenant agrees to repair any such damage so caused by Tenant or Tenant's
employees, agents or invitees or by Tenant's default hereunder. Subject to
the waiver of subrogation provision in Article XIII, Tenant will, however,
be responsible for any bodily injury, death and property damage caused by
the negligence or willful misconduct of Tenant or Tenant's employees, agents
or invitees and will indemnify, defend and hold Landlord harmless from any
claims by third parties, including Tenant's employees, solely with respect
to tenant's negligence or willful misconduct.
B. Tenant's Obligations. Tenant shall repair and maintain in
good repair and order and keep clean and orderly all portions of the Leased
Premises and the systems serving the Premises (other than those specifically
described in Paragraph A. of this Article as Landlord's repair obligations),
including, without limitation: plate glass, store front, entrances, the exterior
of the building; loading docks; storage areas; interior partition walls; doors;
windows; electrical wiring, equipment and fixtures; plumbing lines and fixtures;
and heating and air conditioning equipment and parking lots. Subject to the
waiver of subrogation provision in Article XIII, Tenant's obligations under this
Paragraph B shall not be applicable to any damage caused by the negligence or
willful misconduct of Landlord or Landlord's employees, agents or invitees
involved in the performance of Landlord's repairs, or caused by Landlord's
default hereunder; and Landlord agrees to repair any such damage so caused by
Landlord or Landlord's employees, agents or invitees or by Landlord's default
hereunder. Subject to the waiver of subrogation provision in Article XIII,
Landlord will, however, be responsible for any bodily injury, death and property
damage caused by the negligence or willful misconduct of Landlord or Landlord's
employees, agents or invitees involved in the performance of Landlord's repair
obligations and ill indemnify, defend and hold Tenant harmless from any claims
by third parties, including Landlord's employees, with respect to such
negligence or willful misconduct. Without limiting the generality of the
foregoing, Tenant shall keep the Leased Premises (and all parts thereof) and
sidewalks, serviceways, and loading areas on the Leased Premises neat, clean,
and free from dirt or rubbish at all times, and shall maintain and water all
landscaping and green areas and shall carefully store in an orderly manner all
trash and refuse. Tenant shall be responsible for keeping the roof, gutters and
downspouts open and free of debris. Tenant shall not paint the exterior walls of
the building except with the prior written consent from Landlord. In addition to
any other remedies available to Landlord, Landlord shall have the right to
perform any obligations of Tenant under this Article X.B if Tenant fails to
perform any such obligation for a period of five (5) business days after
Landlord has given Tenant written notice thereof (unless Tenant commences to
cure and diligently pursue the curing of the same) and Tenant shall pay to
Landlord reasonable cost thereof. Landlord shall not be required to give notice
if an emergency exists. An emergency shall exist if a condition or circumstance
exists which if not remedied could result in possible damage to the Building or
Leased Premises or property of others in excess of $5,000.00 or impair the
operations of the mechanical, electrical or plumbing systems of the Leased
Premises or if the life, health or safety of any person could be endangered
thereby. Tenant shall, at its own cost and expense enter into a regularly
scheduled preventative maintenance/service contract with maintenance contractors
for serving all hot water, heating and air conditioning systems, plumbing
systems, elevators and other equipment within the Leased Premises. The
maintenance contractor and the contract must be approved by Landlord in the
exercise of its reasonable discretion. The service contract must include all
services suggested by the equipment manufacturer within the
operation/maintenance manual and must become effective (and a copy thereof
delivered to Landlord) within thirty (30) days of the date Tenant takes
possession of the Leased Premises. Tenant shall arrange for the regular pick-up
of such trash and refuse at Tenant's expense and regular extermination services.
After completion by Landlord of the construction work described in Exhibit "C,"
Tenant shall repair, maintain, and replace such construction and the devices and
equipment installed therein and, if necessary, install additional devices and
equipment (including, without limitation, all grease and oil traps and/or grease
and oil receptors which the City of Houston or any other governmental entity
having jurisdiction over the Leased Premises deems necessary to handle the
liquid waste, grease, and oil produced at the Leased Premises), in a good and
workmanlike manner and in accordance with all applicable laws and regulations
governing such construction, devices, and equipment. Upon the termination of
this Lease or upon the termination of Tenant's right to possession of the Leased
Premises, Tenant shall surrender and deliver up to Landlord the Leased Premises
broom-clean and in the same condition in which they existed on the Commencement
Date, ordinary wear and tear excepted; however, such exception for ordinary wear
and tear shall in no way relieve Tenant of its above-described obligations for
repair, replacement and maintenance during the term of this Lease. Prior to the
end of the Term or upon the termination of Tenant's right to possession of the
Leased Premises or termination of this Lease, but subject to the lien and
security interest and other rights of Landlord referred to in Article XV, Tenant
shall remove "Removable Trade Fixtures," as hereinafter defined (excluding,
however, ducts, conduits, wiring, pipes, paneling or other wall coverings or
floor coverings), and, in addition to other applicable provisions of this Lease
regarding such removal, the following shall apply: Tenant must not be in default
of any obligation or covenant under this Lease at the time of such removal; and
such removal must be effected without material damage to the Leased Premises and
Tenant must promptly repair all damage caused by such removal. For the purposes
hereof, the phrase "Removable Trade Fixtures" means the following: all of
Tenant's signs, counters, tables, chairs, desks, racks, merchandisers and
displays, standards, wall brackets, hang rods, shelves, mirrors, cash registers
and other business machines, wall brackets and other equipment used by Tenant in
its business operations that can be removed without materially damaging the
Leased Premises. "Removable Trade Fixtures" shall not include, for purposes of
Tenant's right to remove at the end of the Term, items originally furnished or
paid for by Landlord or replacements of such items. Unless Tenant shall have at
the time of the alteration requested in writing and obtained Landlord's approval
in writing of any item Tenant desires to remain on the Leased Premises after the
termination of the Lease, Tenant shall, if requested by Landlord in writing
prior to the termination of this Lease, remove any or all alterations,
additions, fixtures, equipment and other property (not constituting Removable
Trade Fixtures) installed or placed by Tenant or any sublessee or assignee (as
herein permitted) (regardless of whether Landlord's consent was obtained with
respect to same) in the Leased Premises and shall repair any damage caused by
such removal and restore the Leased Premises to the condition thereof at the
time of the commencement of the Term of this Lease, excepting only ordinary wear
and tear and damage hereunder not otherwise required to be repaired by Tenant.
If Tenant fails to remove any Removable Trade Fixtures or if Landlord requests
in writing that Tenant remove any or all alterations, additions, fixtures,
equipment and property installed or placed by it or any such sublessee or
assignee in the Leased Premises (not constituting Removable Trade Fixtures) and
Tenant fails to comply with such request prior to the expiration or termination
of the Term of this Lease, or if Tenant fails to repair any damage to the Leased
Premises and/or the Building are a part caused by its removal of any of the
aforesaid, then Landlord shall have the right (but shall not be obligated) to
remove such Removable Trade Fixtures and/or such other alterations, additions,
fixtures, equipment or property installed or placed by Tenant in the Leased
Premises (Tenant hereby waiving any damage caused thereby) or repair any such
damage to the Leased Premises and/or Building are a part and thereupon Tenant
shall, at Landlord's election, on demand pay (or reimburse Landlord for) the
reasonable cost of such removal and the reasonable cost of transportation and
storage on any Removable Trade Fixtures (or other alterations, additions,
fixtures, equipment and property installed or placed by Tenant in the Leased
Premises) which Landlord elects to store pending disposition thereof, and the
reasonable cost of repairing any such damage to the Leased Premises and/or
Building, and, in addition, Tenant shall pay Landlord upon demand interest on
all such sums at the highest lawful rate applicable under Texas law. All
plumbing or electrical wiring connections exposed as a result of the removal of
Tenant's Removable Trade Fixtures, or other alterations, additions, fixtures,
equipment and property installed or placed by it in the Leased Premises (if such
removal is so requested by Landlord) shall be capped by Tenant in a safe and
workmanlike manner. Use by Tenant in advertising, letterheads, or otherwise of
any trade name or trademark used by Landlord shall be subject to such
restrictions and regulations as Landlord may prescribe from time to time.
XI. Casualty Damage..
A. Repairs. In the event of a fire or other casualty in the
Building, Tenant shall immediately give notice thereof to Landlord.
Except as otherwise provided below, Landlord shall use its reasonable
efforts after receipt of insurance proceeds to cause the repairs to be made
with due diligence and reasonable dispatch; provided, however, that
Landlord shall not be required to repair or replace furnishings, furniture,
or other personal property which Tenant may be entitled to remove from the
Leased Premises or any property improvement constructed and installed by or
for Tenant other than what was originally built by Landlord.
Notwithstanding the provisions of the preceding sentence, in the event that
the damage to the Building by fire or other casualty (i) will cost less
than Two Hundred Fifty Thousand Dollars ($250,000.00) to repair, (ii) was
not caused by the intentional, unlawful acts of Tenant or Tenant's agents,
employees, customers, or guests and (iii) unreasonably interferes with the
normal conduct of business by Tenant at the Leased Premises, then Landlord
shall commence making the required repairs within sixty (60) days following
the date of the casualty or other damage and thereafter prosecute the
repairs with due diligence and reasonable dispatch. If the Leased
Premises, or any portion thereof, through no fault or neglect of Tenant,
its agents, employees, customers or guests, shall be partially destroyed by
fire or other casualty so as to render the Leased Premises, or any portion
thereof untenantable and such portion is not actually used by Tenant, the
rental herein shall proportionately xxxxx thereafter until such time as the
Leased Premises, or any portion thereof, are made tenantable; provided,
however, there shall be no abatement of rent and/or any abatement of rental
shall cease as to the portion of the Leased Premises actually used by
Tenant. If Landlord has elected to repair and reconstruct the Leased
Premises, this Lease shall continue in full force and effect and such
repairs will be made as soon as reasonably practicable thereafter, but not
later than one hundred and eighty (180) days after the date of the casualty
or other damage, subject to delays arising from shortages of labor or
material, acts of God, war or other conditions beyond Landlord's reasonable
control, as defined in Section XXIII-O below; provided, however, that
Landlord shall use its best efforts to not interfere with Tenant's use and
occupancy of any portion of the Leased Premises not destroyed or damaged.
Except as otherwise expressly provided above, in no event shall Landlord be
required to commence the restoration or repair of the Leased Premises until
Landlord receives the insurance proceeds therefor. No damages,
compensation, or claims shall be payable by Landlord for any inconvenience,
loss of business, or annoyance arising from such repair and
reconstruction. Tenant and Landlord agree that the term of this Lease
shall be extended by a period of time equal to the period of such repair
and reconstruction.
B. Termination. In the event such destruction results in
one-half (1/2) or more of the Building being untenantable for a period,
reasonably estimated by a responsible contractor selected by Landlord, to be
six (6) months or longer after the date of the destructive event, Landlord
shall so notify Tenant promptly in writing and then either Landlord or
Tenant may cancel this Lease by delivering written notice thereof to the
other party. Landlord shall select a responsible contractor and deliver to
Tenant the results of the responsible contractor's analysis ("Damage
Analysis") within thirty (30) days of the destructive event. If Landlord is
entitled to terminate this Lease, Landlord shall give to Tenant within
thirty (30) days following Landlord's delivery to Tenant of the Damage
Analysis written notice of whether or not Landlord is electing to terminate
this Lease pursuant to the foregoing provisions of this Article XI. If
Landlord does not so terminate this Lease, then such written notice shall
also advise Tenant of Tenant's right to elect to terminate this Lease
pursuant to the foregoing provisions of this Article XI, and Tenant must
exercise such right of termination, if at all, by giving written notice
thereof to Landlord within not more than thirty (30) days after receipt of
said written notice from Landlord to Tenant.
C. Rent. In the event the Building shall be so damaged that
Landlord shall decide not to rebuild to the same or substantially the same
condition as immediately prior to such fire or other casualty or Tenant
elects to exercise its right to terminate this Lease, then all rent owed up
to the time of such destruction or termination, as set forth in Article XI,
shall be paid by Tenant and thenceforth this Lease shall cease and come to
an end. In the event that this Lease is terminated as herein permitted,
Landlord shall refund to Tenant the prepaid rent and the Security Deposit,
less any sum then owing or which would thereafter become owing to Landlord
by Tenant.
XII. Condemnation.
If (i) ten percent (10%) or more of the Leased Premises, other than
the Building or (ii) any part of the Building is condemned (or conveyed to a
governmental authority in lieu of condemnation), then Landlord may elect to
terminate this Lease or to continue the Lease in effect. If Landlord elects
to terminate this Lease, then the Term shall terminate on the date that
possession of such portion of the Leased Premises or the Building is taken
by the governmental authority. All condemnation awards for a taking of
either the Leased Premises or the Building shall belong to Landlord. If
twenty percent (20%) or more of the Leased Premises (other than the Building
)or any portion of the Building should be condemned by any governmental
authority, or if Landlord makes a voluntary conveyance of twenty percent
(20%) or more of the Leased Premises (other than the building) or any
portion of the Building (in lieu of condemnation) to such governmental
authority, then Tenant may elect to terminate this Lease by delivering
notice of such election to Landlord within fifteen (15) business days of the
date on which Landlord informed Tenant of such conveyance or condemnation
and then the Term shall terminate on the date that possession of the Leased
Premises or the Building is taken by the governmental authority. If less
than ten percent (10%) of the Leased Premises (other than the Building) and
no portion of the Building is condemned or voluntarily conveyed and/or in
the event that neither Landlord or Tenant exercise their above described
right to terminate this Lease in the event that twenty percent (20%) or more
of the Leased Premises (other than the Building) or any portion of the
Building should be condemned by any governmental authority, or if Landlord
makes a voluntary conveyance of twenty percent (20%) or more of the Leased
Premises (other than the Building) or any portion of the Building (in lieu
of condemnation) to such governmental authority, this Lease shall remain in
full force and effect; and the Base Rent if a portion of the Building is
taken will be reduced in proportion to the square footage of the Building
that has been taken. Tenant shall not be entitled to receive and hereby
assigns to Landlord any award in a condemnation for loss of its leasehold
estate.
XIII. Insurance.
A. Tenant's Insurance.. Tenant agrees to maintain a policy of
property insurance on its fixtures, equipment, merchandise, Removable Trade
Fixtures, alterations and other property placed at the Leased Premises.
Such policy must be in effect as of the Tender Date and must be maintained
at all times during Tenant's occupancy of the Leased Premises and during the
Term. Such policy shall satisfy any co-insurance requirements and must
contain a replacement cost endorsement. TENANT AGREES TO USE AND OCCUPY THE
LEASED PREMISES AND PLACE ITS FIXTURES, EQUIPMENT, MERCHANDISE, AND OTHER
PROPERTY AT ITS OWN RISK AND HEREBY WAIVES AND RELEASES ALL RIGHTS OF
RECOVERY AGAINST LANDLORD AND THE INDEMNITEES (HEREAFTER DEFINED) FOR DAMAGE
TO THE PROPERTY OF TENANT OR PERSONAL INJURY OR DEATH TO THE FULLEST EXTENT
PERMITTED BY LAW, WHETHER THE SAME IS CAUSED BY FIRE OR OTHER CASUALTY OR
THE CONDITION OF THE LEASED PREMISES, REGARDLESS OF THE CAUSE OF THE LOSS,
EXCEPT FOR THOSE LOSSES RESULTING FROM OR ARISING OUT OF THE GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT OF LANDLORD OR ANY INDEMNITEE. THIS WAIVER
AND RELEASE APPLIES EVEN IF THE LOSS IS CAUSED BY THE ACTS OR OMISSIONS OF
LANDLORD OR THE INDEMNITEES, WHETHER OR NOT NEGLIGENT, EXCEPT FOR THE GROSS
NEGLIGENCE OR WILFUL MISCONDUCT OF LANDLORD AND THE INDEMNITEES, AND SHALL
BAR RECOVERY AGAINST LANDLORD OR THE INDEMNITEES BY ANY THIRD PARTY
(INCLUDING, WITHOUT LIMITATION, ANY INSURER) BY WAY OF SUBROGATION OR
ASSIGNMENT. TENANT'S WAIVER AND RELEASE OF LANDLORD AND THE INDEMNITEES
SHALL BIND TENANT'S PERMITTED ASSIGNEES AND SUBTENANTS. Tenant shall take
out and maintain commercial general liability insurance coverage (and such
other coverage as requested by Landlord from time to time) in an amount
determined by Landlord from time to time, which shall initially be in a
minimum amount of $1,000,000 per occurrence, $2,000,000 policy aggregate,
including coverage for bodily injury and death, property damage and
products liability coverage; contractual liability coverage insuring the
obligations of Tenant under the Lease; and fire and legal liability
coverage with respect to the Leased Premises and the Building in an amount
of at least $50,000. The policy shall designate Landlord as an additional
insured. Such policy must be in effect as of the Tender Date and must be
maintained at all times during Tenant's occupancy of the Leased Premises and
during the Term. A duplicate original or a certificate of all insurance
policies required to be maintained by Tenant shall be deposited with
Landlord within five (5) business days following the Tender Date and current
certificates (or duplicate Policy originals) shall be deposited with
Landlord at all times during Tenant's occupancy of the Leased Premises and
during the Term.
Tenant shall defend, indemnify and hold harmless Landlord and the
Indemnities from all losses, claims, suits, actions, damages and liability,
including defense costs, investigative costs and fees of experts
(collectively, "Claims") that arise or allegedly arise from any of the
following circumstances: (i) any act or omission of Tenant or Tenant's
agents, employees, contractors, subcontractors, customers or invitees (or
any of their employees); (ii) any failure of Tenant or Tenant's agents,
employees, contractors or subcontractors to comply with laws, ordinances or
regulations of any governmental authority pertaining to the use,
construction, renovation, repair or occupancy of the Leased Premises or
pertaining to Tenant's business or pertaining to health or the environment;
and (iii)any injury, death or property damage suffered by any person that
occurs in the Leased Premises which is caused by Tenant or Tenant's agents,
employees, contractors, subcontractors, customers or invitees.
Tenant's obligations include: (i) THE OBLIGATION TO DEFEND LANDLORD AND THE
INDEMNITEES AGAINST ALL SUCH CLAIMS EXCEPT TO THE EXTENT THAT THE NEGLIGENT
ACTS OR OMISSIONS OF LANDLORD OR OF THE INDEMNITEES, WERE THE CAUSE OF THE
CLAIM, BUT IN NO EVENT SHALL SUCH INDEMNIFICATION OBLIGATION APPLY TO THE
GROSS NEGLIGENCE OR WILFUL MISCONDUCT OF LANDLORD OR THE INDEMNITEES;
(ii) the obligation to pay Tenant's the full amount of any settlement reached
by Tenant with respect to the Claim; and (iii) the obligation to pay the
tenant's proportionate share of any damages that are awarded with respect to
the Claim. For purposes of the Lease, the "Indemnities" shall mean Landlord
and Landlord's directors, officers, managers, partners, joint venturers,
members, agents, attorneys, contractors, affiliates, and employees and their
respective heirs, legal representatives, successors, and assigns. If Tenant
should fail to comply with the foregoing insurance requirements, Landlord
may declare Tenant in default of this Lease or obtain such insurance and
Tenant shall pay to Landlord on demand as additional rent hereunder the
premium cost thereof plus interest, at the lesser of: (i)the then highest
lawful rate Tenant is authorized to pay under the laws of the State of Texas
or the laws of the United States of America, or (ii) eighteen percent (18%)
per annum from the date of payment by Landlord until repaid by Tenant.
B. Landlord's Insurance and Waiver of Subrogation. Landlord shall
maintain casualty insurance on the Leased Premises in an amount not less
than the greater of: (i) $1,500,000, if available, and (ii) eighty-five
percent (85%) of the replacement cost of the Leased Premises. To the extent
that any insurance coverage by Landlord will not be invalidated thereby, it
is agreed that where Landlord may sustain a loss or damage by reason of fire
or other casualty which is a loss or damage against which Landlord is fully
protected by an existing policy of insurance (or would be fully protected if
Landlord maintained the required insurance coverage) , and such fire or
casualty is caused in whole or in part by acts or omissions of Tenant or its
agents or employees, then Landlord agrees to look solely to the proceeds of
its previously mentioned policy of insurance (or proceeds which would be
payable if Landlord maintained the required insurance coverage), and
Landlord shall have no right of recovery (to the extent of such insurance
coverage or proceeds which would be payable if Landlord had maintained the
required insurance coverage) against Tenant or other agents or employees of
Tenant and no third party shall have any right of recovery by way of
assignment or subrogation. Landlord shall defend, indemnify and hold
harmless Tenant from all losses, claims, suits, actions, damages and
liability, including defense costs, investigative costs and fees of experts
(collectively "claims") that arise or allegedly arise from any of the
following circumstances: (i.) any act or omission of Landlord or Landlord's
agents, employees, contractors, subcontractors, customers or invitees ( or
any of their employees); and (ii.) any injury, death or property damage
suffered by any person or entity that occurs in the Leased Premises which is
caused by Landlord or Landlord's agents, employees, contractors,
subcontractors, customers or invitees.
XIV. Assignment and Subletting. Except for Permitted Assignments (as
herein defined), Tenant may not assign this Lease or sublease all or any
part of the Leased Premises, without the prior written consent of Landlord,
which will not be unreasonable withheld.. Tenant may not mortgage, pledge
or allow a lien on its leasehold interest in the Leased Premises. Any
attempt by Tenant to do any of these actions directly, indirectly (such as
through a conveyance of an ownership interest in Tenant), without the prior
written consent of Landlord or by operation of law shall be void from its
inception and of no force or effect. For purposes of this Lease, an
"assignment" shall include (but shall not be limited to) the following: (i)
a transfer of the majority (whether the same is accomplished in one or more
transactions) of the voting stock in Tenant or any corporation which is a
partner in Tenant; (ii) a transfer of a majority (whether the same is
accomplished in one or more transactions) of the ownership interest in
Tenant (whether or not Tenant is a corporation); and (iii) any sale of all
or substantially all of Tenant's assets, merger, share exchange,
consolidation, or dissolution to which Tenant is a party. In the event of
any such attempted assignment or attempted sublease or should Tenant, in any
transaction of any other nature, permit or attempt to permit anyone to
occupy the Leased Premises (or any portion thereof), without the prior
written consent of Landlord, Landlord shall thereupon have the right and
option (but no obligation) to cancel and terminate this Lease effective upon
fifteen (15) business days written notice to Tenant (with no opportunity to
cure by Tenant) given by Landlord at any time thereafter either as to the
entire Leased Premises or as to only the portion thereof which Tenant shall
have attempted to assign or sublease or otherwise permitted some other
party's occupancy. This prohibition against assigning or subletting shall
be construed to include a prohibition against any assignment or subletting
by operation of law. The consent of Landlord shall not be required for any
assignment of this Lease or subletting of the Leased Premises, or any part
thereof, to an Affiliate of Tenant (as hereinafter defined); provided,
however, that Tenant shall promptly notify Landlord of any such assignment
or subletting and with respect to any such assignment or sublease of this
Lease shall deliver a written assumption in favor of Landlord of the duties
and obligations of Landlord hereunder by such Affiliate. An "Affiliate" for
the purposes of this section shall be any person or entity which Tenant
controls and in which Tenant owns at least fifty-one percent (51%). No
assignment or subletting by Tenant shall relieve Tenant of any obligation
under this Lease and Tenant and Tenant's assignee and sublessee shall remain
jointly and severally liable hereunder. If an Affiliate of Tenant ceases at
any time to be an Affiliate of Tenant, the Leased Premises shall immediately
be assigned to Tenant and Tenant shall reoccupy the Leased Premises;
otherwise, such an event shall be treated as if an assignment or subletting
had been made without Landlord's consent when consent is required and be a
default hereunder.
In the event Tenant should desire to assign this Lease or sublet
the Leased Premises or any part thereof, Tenant shall give Landlord written
notice of such desire at least thirty (30) days in advance of the date on
which Tenant desires to make such assignment or sublease, together with
reasonable detailed information identifying the proposed assignee or
sublessee, proposed use, and current financial information with respect to
the proposed assignee or sublessee. Landlord shall then have a period of
fifteen (15) days following receipt of such notice (provided that Landlord
has received all information pertaining to the proposed assignee or
sublessee necessary to make a decision with respect thereto) within which to
notify Tenant in writing that Landlord elects either (1) to permit Tenant to
assign this Lease or sublet such space, subject, however, to (i) written
approval of the proposed assignee or subtenant by Landlord and (ii) the
requirement that the assignee or subtenant, enters into a written assignment
or sublease, as applicable, with the Tenant, subject to the Landlord's
written approval, or (2) to refuse to consent to Tenant's assignment of this
Lease or sublease of such space and to continue this Lease in full force and
effect as to the entire Leased Premises. If the information provided by
Tenant with respect to the proposed assignee or sublessee is not sufficient
for Landlord to make the required decision described in the preceding
grammatical sentence, Landlord will notify Tenant in writing of such fact
within five (5) business days following receipt of such information. Tenant
shall then be required to provide such information to Landlord before
Landlord makes the above described decision with respect to the proposed
assignee or sublessee, such decision to be made within fifteen (15) days
following receipt by Landlord of the requested information. If Landlord
should fail to notify Tenant in writing of such election within the stated
fifteen (15) day period, as said fifteen (15) day period may be extended for
Tenant to furnish supplemental information regarding the proposed assignee
or sublessee, Landlord shall be deemed to have elected option (2) above. No
consent by Landlord to any assignment or sublease shall be deemed to be
consent to a use not permitted under this Lease, to any act in violation of
this Lease, or to any other or subsequent assignment or sublease, and no
assignment or sublease by Tenant shall relieve Tenant of any obligation
under this Lease. Any sublease or assignment shall be subject to all the
terms and conditions of this Lease. Any attempted assignment or sublease by
Tenant in violation of the terms and covenants of this paragraph shall be
void.
Notwithstanding that the prior written consent of Landlord to any
of the aforesaid transactions may have been obtained, the following shall
apply in the event of an assignment or sublease, contemporaneously with the
granting of Landlord's aforesaid consent: (1) Tenant shall cause the
assignee or sublessee to expressly assume in writing and agree to perform
all of the covenants, duties and obligations of Tenant hereunder and such
assignee shall be jointly and severally liable therefor along with Tenant
and the assignee or sublessee, as applicable, shall agree in writing that
Landlord shall be permitted to enforce the provisions of this Lease against
the undersigned Tenant and/or any assignee or sublessee without demand upon
or proceeding in any way against Tenant; (2) Tenant shall further cause such
assignee or sublessee to grant Landlord an express contract lien and
security interest (and execute one or more Uniform Commercial Code Financing
Statements) in the manner hereinafter stated as applicable to Tenant,
including a signed counterpart of all instruments relative thereto (executed
by all parties to such transaction with the exception of Landlord) shall be
submitted by Tenant to Landlord prior to or contemporaneously with the
request for Landlord's written consent thereto (it being understood that no
such instrument shall be effective without the written consent of Landlord,
provided, however that Landlord will subordinate its statutory lien and
contract lien herein created to any liens in favor of a third party lender
unrelated to the assignee or sublessee who finances all or any portion of
the assignee's or sublessee's business or property, subject to the
requirements outlined in Article XV with respect to Tenant; (3) Tenant shall
subordinate to Landlord's statutory lien and Landlord's hereinafter
described contract lien and security interest, any liens or other rights
which Tenant may claim with respect to any fixtures, equipment, goods,
wares, merchandise or other property owned by or leased to the proposed
assignee, or sublessee or other party intending to occupy the Leased
Premises; (4) no usage of the Leased Premises shall constitute a Prohibited
Use or be materially different from the general usage herein made by Tenant;
(5) the assignee's or sublessee's proposed use will not involve the use of
any substance, material or any activity which would violate the provisions
of Exhibit "H"; and (6) in any case where Landlord consents to an
assignment, subleasing, grant of a concession or license or mortgage, pledge
or hypothecation of the leasehold or sublease of the Leased Premises, the
undersigned Tenant will nevertheless remain directly and primarily liable
for the performance of all of the covenants, duties and obligations of
Tenant hereunder (including, without limitation, the obligation to pay all
rental and other sums herein provided to be paid).
XV. Intentionally Deleted
XVI. Default.
A. Events of Default. Each of the following acts of Tenant
constitutes an event of default ("Event of Default") under this Lease:
Tenant's failure to pay the required amount of rent when due or the required
amount of any other monetary sum when due under this Lease; Tenant's failure
to comply with any covenant, duty or obligation of Tenant under Article of
this Lease that is not cured within five (5) business days after notice of
such failure from Landlord; and Tenant's failure to comply with any
covenant, duty or obligation of Tenant under this Lease (other than those
referred to in clauses [i] and [ii], above) that is not cured within thirty
(30) days after Tenant receives a notice of such failure from Landlord.
Provided that if such default is not capable of being cured within such
thirty (30) day period and Tenant commences curing within such thirty (30)
day period and diligently pursues curing of the same thereafter, the same
shall not be a default so long as Tenant is diligently pursuing the curing
of such default.
B. Landlord's Remedies.. If an Event of Default should occur
under this Lease, then Landlord may do any of the following (in conjunction
with or in addition to pursuing any or all of the other rights and remedies
provided to Landlord under this Lease, by law, or in equity):
(i) terminate the Lease by sending a written termination notice to Tenant at
the address stated above (in which event, Tenant will immediately
surrender possession of the Leased Premises to Landlord); or
(ii) enter upon and take possession of the Leased Premises and
expel or remove Tenant and any other occupant therefrom and
terminate Tenant's right to possession of the Leased
Premises with or without terminating the Lease (in which
event, Tenant shall immediately surrender possession of the
Leased Premises to Landlord);
(iii) remedy the Event of Default on behalf of Tenant (in which
event, Tenant must pay to Landlord all of Landlord's
reasonable costs and expenses so incurred immediately upon
receipt of Landlord's invoice); and/or
(iv) recover all amounts then owing (and, after the passage of
time, that become owing) under the Lease without terminating
the Lease or Tenant's right to possession of the Leased
Premises.
Landlord's exercise of any of the remedies available to Landlord under the
Lease shall not constitute Landlord's acceptance of surrender of the Leased
Premises by Tenant, whether by agreement or by operation of law, it being
understood that such surrender can be effected only by the written agreement
of Landlord and Tenant. Tenant hereby acknowledges that Landlord shall have
the right, after an Event of Default which involves a failure to timely pay
any rent, without any notice to Tenant (to the extent allowed by law), to
alter locks and other security devices at the Leased Premises and remove
Tenant's property and the property of others located within the Leased
Premises. Landlord may require full payment of the rent then due to
Landlord under this Lease as a condition to Tenant's entitlement to a key to
new or altered locks that Landlord may have placed on the Leased Premises
after an Event of Default which involves a failure to pay rent. If Landlord
exercises its rights to alter the locks at the Leased Premises, Landlord or
its agents shall place a written notice on Tenant's front door of the Leased
Premises stating the name, address and phone number of the individual or
company from which the new key may be obtained. Landlord shall only be
required to provide Tenant with a new key during Tenant's regular business
hours which are agreed to be 8:00 a.m. to 5:00 p.m. Monday through Friday
except for holidays; provided that in no event shall Landlord be required to
provide Tenant a new key until such time as Tenant pays all rent due under
this Lease. No such alteration of locks or other security devices and no
removal or other exercise of dominion by Landlord over the property of
Tenant or others at the Leased Premises shall be deemed unauthorized or to
constitute a conversion, Tenant hereby consenting, after any Event of
Default, to the aforesaid exercise of dominion over Tenant's property within
the Leased Premises. All claims for damages (INCLUDING CLAIMS FOR DAMAGES
BASED UPON NEGLIGENT ACTIONS OF LANDLORD OR LANDLORD'S AGENTS OR CONTRACTORS
BUT NOT LANDLORD OR LANDLORD'S AGENTS' OR CONTRACTORS' GROSS NEGLIGENCE OR
WILFUL MISCONDUCT) by reason of such lawful reentry and/or repossession are
hereby waived. Further, all claims for damages by reason of such lawful
alteration of locks or other security devices are hereby waived, as are all
claims for damages by reason of any distress warrant, forcible detainer
proceedings, sequestration proceedings or other legal process. Tenant
agrees that any reentry by Landlord after proper notice as outlined in this
Article XVI has been given may be pursuant to a judgment obtained in
forcible detainer proceedings or other legal proceedings or without any
legal proceedings, as Landlord may elect; and Landlord shall not be liable
in trespass or otherwise. To the extent of any inconsistency between this
Lease and the provisions of Section 93.002 of the Texas Property Code (as it
may be hereafter amended or recodified), it is the agreement of the parties
that this Lease shall prevail. In the event of termination of this Lease or
of Tenant's right to possession of the Leased Premises or repossession of
the Leased Premises or the exercise by Landlord of any other right or remedy
for an Event of Default, Landlord shall not (to the extent allowed by law)
have any obligation whatsoever to relet or attempt to relet the Leased
Premises, or any portion thereof, or to collect rental after reletting (if
any); but Landlord shall have the option to relet or attempt to relet and,
in the event of reletting, Landlord may relet the whole or any portion of
the Leased Premises for any period, to any tenant, and for any use and
purpose. Tenant waives any implied reletting obligation.
If Landlord elects to terminate the Lease by reason of an Event of
Default, or if Landlord elects to terminate Tenant's right to possession of
the Leased Premises without terminating this Lease, or if Landlord exercises
any other remedy, Landlord may hold Tenant liable for all Base Rent, Taxes
and Insurance Premiums and other indebtedness accrued to the date of such
termination (or other remedy exercised), plus such Base Rent, Taxes and
Insurance Premiums, and other indebtedness as would otherwise have been
required to be paid by Tenant to Landlord during the period following
termination of the Term (or Tenant's right to possession of the Leased
Premises or other remedy exercised, as the case may be) measured from the
date of such termination by Landlord until the date which would have been
the date of expiration of the Term as stated in Article I.D (had Landlord
not elected to terminate the Lease or Tenant's right to possession on
account of such Event of Default) diminished by any net sums (if any)
thereafter received by Landlord through re-letting the Leased Premises
during said period (after deducting expenses incurred by Landlord as
provided in the succeeding paragraph). Following the date of notice of
termination of the Lease or the termination of Tenant's right to possession,
without the termination of the Lease, Landlord shall make reasonable good
faith attempts to relet the Leased Premises or portions thereof at the then
prevailing market rates and terms. As used herein, "reasonable good faith
attempts to re-let" shall mean (a) listing the Leased Premises for lease
with a licensed real estate broker, which may be an affiliate of the
Landlord, who notifies at least ten (10) other brokers of the availability
of the Leased Premises, (b) entertaining in good faith, but not necessarily
accepting offers to lease, (c) to the extent allowed by law or applicable
deed restrictions, placing "For Lease" signs on the Leased Premises and (d)
and in no event shall Landlord be obligated to accept an assignee or
sublessee who desires to use the Leased Premises for one of the Prohibited
Uses. Actions to collect amounts due by Tenant provided for in this
paragraph of Article may be brought from time to time by Landlord during
the aforesaid period, on one or more occasions, without the necessity of
Landlord's waiting until expiration of such period; and in no event shall
Tenant be entitled to any excess of rent (or rent plus other sums) obtained
by re-letting over and above the rent herein reserved.
In addition to all other amounts and other obligations for which
Tenant is liable upon an Event of Default, in case of an Event of Default,
Tenant shall also be liable for and shall pay to Landlord at Houston, Xxxxxx
County, Texas, in addition to any sum provided to be paid above: reasonable
broker's fees and all other reasonable costs and fees incurred by Landlord
in connection with re-letting, or attempting to re-let, the whole or any
part of the Leased Premises; the reasonable costs of removing and storing
Tenant's or other occupant's property; the reasonable costs of repairing,
altering, remodeling, or otherwise putting the Leased Premises into a
condition acceptable to a new tenant or tenants; reasonable costs associated
with the execution of any lease with a new tenant or tenants (including,
without limitation, reasonable attorneys' fees); and all expenses incurred
by Landlord in enforcing Landlord's remedies (including, without limitation,
attorneys' fees). Past due rent and other past due payments shall bear
interest from maturity until paid at the lesser of: (i) the highest
non-usurious rate permitted by law or (ii) fifteen percent (15%) per annum.
C. Landlord's Default.. If Landlord should fail to perform
any of its obligations under this Lease, Tenant's exclusive remedy is the
institution of a suit for damages (Tenant hereby waiving the benefit of any
laws granting it a lien on the property of Landlord) which shall be subject
to the provisions of Article XIX below. Prior to instituting such a suit,
Tenant must supply Landlord with notice of such failure. Landlord shall
then have a reasonable period of time, but not less than thirty (30) days
following Landlord's receipt of Tenant's notice, in which to commence
curative action. Tenant may not institute such a suit during such thirty
(30)-day period or thereafter during the period in which Landlord is
attempting to cure such default. In no event shall Tenant have the right to
offset any sum owing, or allegedly owing, by Landlord to Tenant against any
sum otherwise owing by Tenant to Landlord.
XVII. Holdover. If Tenant should remain in possession of the Leased
Premises after the end of the Term, then Tenant shall be occupying the
Leased Premises as a tenant-at-sufferance, under all of the terms and
conditions of this Lease, except that the Base Rent payable during the
holdover period shall be equal to one hundred fifty percent (150%) of the
Base Rent last applicable during the Term.
XVIII. Notice. Any notice given under this Lease must be in writing and
delivered by U.S. certified mail, return receipt requested, or by hand.
Notices given to Landlord by U.S. certified mail must be sent to Landlord
at Landlord's address stated above; and notices given to Tenant by U.S.
certified mail must be sent to Tenant at Tenant's address stated above.
Either party may change their address by giving the other party notice of
such change. A signed return receipt shall be conclusive evidence that the
notice was delivered in the due course of mail. Notice that is properly
addressed, with adequate postage prepaid and mailed by certified mail,
return receipt requested, shall be deemed received upon the earlier of
actual receipt, as indicated on the signed, returned receipt card; or three
days after appropriate posting (whether or not actually received or
accepted). Notice given by hand shall be effectively given wherever the
intended recipient is found and shall be deemed received upon the date of
delivery or on the date of attempted delivery if delivery is refused. No
change of address of either party shall be binding on the other party until
notice of such change of address is given to the other party.
XIX. Limitation of Liability. Tenant waives and relinquishes all rights
to claim any nature of lien against rent. Under no circumstances whatsoever
shall Landlord ever be liable hereunder for consequential damages or special
damages; and all liability of Landlord for damages for breach of any
covenant, duty or obligation of Landlord hereunder may be satisfied only out
of the interest of Landlord in the Leased Premises existing at the time any
such liability is adjudicated in a proceeding as to which the judgment
adjudicating such liability is non-appealable and not subject to further
review. The term "Landlord" shall mean only the owner for the time being of
the Leased Premises, and in the event of the transfer by such owner of its
interest in the Leased Premises, such owner shall thereupon be released and
discharged from all covenants and obligations of Landlord thereafter
accruing, but such covenants and obligations shall be binding during the
lease term upon each new owner for the duration of such owner's ownership.
XX. Inspection and Access to Leased Premises.. Landlord and any
mortgagee shall have the right to enter upon the Leased Premises at any
reasonable time after two (2) business days prior written notice for the
purpose of evaluating Tenant's performance under this Lease, inspecting the
same, making repairs or additions to the Leased Premises or showing the
Leased Premises to prospective purchasers, lessees, or lenders. Landlord
shall be required to give no notice in connection with making repairs or
additions to the Leased Premises if an emergency exists. An emergency shall
be deemed to exist if a condition or circumstance exists which left
unchanged could damage the Leased Premises, the property of any person or
entity in an amount in excess of $5,000, or impair any mechanical,
electrical and plumbing systems of the Building or endanger the life, health
or safety of any person at the Leased Premises. Landlord may place "for
lease" or "for sale" notices upon the Leased Premises. In any circumstances
where Landlord is permitted to enter upon the Leased Premises during the
Term, no such entry shall constitute an eviction or disturbance of Tenant's
use and possession of the Leased Premises or a breach by Landlord of any of
its obligations hereunder or render Landlord liable for damages for loss of
business or otherwise or entitle Tenant to be relieved from any of its
obligations hereunder or grant Tenant any right of set-off or recoupment or
other remedy; and in connection with any such entry incident to performance
of repairs, replacements, maintenance or construction, all of the aforesaid
provisions shall be applicable notwithstanding that Landlord may elect to
take building materials in, to or upon the Leased Premises that may be
required or utilized in connection with such entry by Landlord.
XXI. Mortgage. Tenant agrees that its interest under this Lease shall
be subordinate to any mortgage, deed of trust or similar encumbrance placed
upon the Leased Premises. Nevertheless, a lender holding a mortgage
encumbering the property of which the Leased Premises is a part or the
purchaser at a foreclosure sale shall have the right and option to make this
Lease superior. Within ten (10) days of a request by Landlord from time to
time, Tenant shall execute and deliver to Landlord a subordination,
non-disturbance and attornment agreement in the form required by Landlord's
mortgagee. If in connection with Landlord obtaining financing for the
property of which the Leased Premises is a part, from time to time, such
lender shall request reasonable modifications in this Lease as a condition
of providing Landlord such financing, then Tenant shall not unreasonably
withhold, delay, or defer its consent thereto; provided, that such
modifications do not unreasonably increase the obligations of Tenant
hereunder or materially affect the leasehold interest created hereby or
increase the Base Rent due hereunder. No amendment or modification of this
Lease occurring after the date of any mortgage shall be binding on any
Landlord's mortgagee unless such amendment or modification is expressly
approved in writing by such mortgagee.
XXII. Non-Liability. Without limiting the generality of the waiver
contained in Article XIII, Landlord and the Indemnitees shall not be liable
to Tenant for any injury or death to person or damage or destruction to
property sustained by Tenant or any person claiming through Tenant resulting
from Tenants repair obligation of the Leased Premises becoming out of
repair or by defect in or failure of equipment, pipes or wiring, or by
broken glass, or by the backing up of drains, or by gas, water, steam,
electricity, or oil leaking, escaping or flowing into the Leased Premises;
provided, however, that Landlord shall remain liable for the performance of
its repair obligations pursuant to Article X; nor shall Landlord or the
Indemnities be liable to Tenant for any loss or damage that may be
occasioned by or through the acts or omissions of any other persons
whomsoever,unless representing Landlord.
XXIII. Miscellaneous.
A. Independent Covenants. The obligation of Tenant to pay
rent and the obligation of Tenant and Landlord to perform Tenant's other
covenants and duties under this Lease are independent, unconditional
obligations that are to be performed at all times provided for in this
Lease.
B. Waiver. Tenant waives and relinquishes any right to
assert that Landlord is bound to perform (or is liable for nonperformance
of) any implied covenants or duties of Landlord that are not stated in this
Lease. Tenant agrees that Landlord shall incur no liability to Tenant due
to any apparent or latent defect in the Leased Premises, but Landlord shall
remain liable for its repair obligations pursuant to Article X. Except as
expressly provided herein, Landlord makes no express or implied warranty
regarding the condition or any other feature of the Leased Premises,
including the Building, or this Lease, and Tenant hereby waives all such
warranties.
C. Entire Agreement. This document constitutes the entire
agreement between Landlord and Tenant. No prior written or prior or
contemporaneous oral promises or representations shall be binding.
D. Estoppel Certificate. Tenant shall execute estoppel
certificates in the form attached hereto as Exhibit "E" and made part hereof
or such other form that may be reasonably requested by Landlord or by any
current or prospective purchaser of the Leased Premises or any part thereof
or lienholder within ten (10) days following such request. If Landlord
advises Tenant of the existence of a lien on the Leased Premises, Tenant
agrees to supply the lienholder with copies of all notices that it
thereafter sends to Landlord, and shall allow such lienholder to exercise
all of Landlord's entry and curative rights under this Lease (but the
lienholder shall have thirty [30] days following written notice from Tenant
in which to attempt to cure Landlord's default, but shall be under no
obligation to do so [or such longer period as agreed to by Tenant in any
nondisturbance, subordination and attornment agreement entered into with the
lienholder]).
E. Time is of the Essence. Time is of the essence of this
Lease.
F. Binding Effect. This document shall bind and inure to the
benefit of the respective heirs, executors, administrators, successors and
permitted assigns of the parties (without altering the provisions of this
Lease regarding assignment and subletting).
G. Non-Waiver. Neither acceptance of any rent nor any other
amount by Landlord nor failure by Landlord or Tenant to complain of any
action, non-action or default of Tenant or Landlord, as applicable, shall
constitute a waiver as to any breach of any covenant or condition of Tenant
or Landlord, as applicable, contained herein nor a waiver of any of
Landlord's or Tenant's rights hereunder, as applicable. Waiver by Landlord
of any right for any default of Tenant shall not constitute a waiver of any
right for either a prior or subsequent default of the same obligation or for
any prior or subsequent default of any other obligation. Wavier by Tenant
of any right for any default of Landlord shall not constitute a waiver of
any right for either a prior or subsequent default of the same obligation or
for any prior or subsequent default of any other obligation. No right or
remedy of Landlord or Tenant hereunder or covenant, duty or obligation of
Tenant or Landlord hereunder shall be deemed waived by Landlord or Tenant
unless such waiver is in writing and signed by Landlord or Tenant, as
applicable.
H. Relationship. The relation created by this Lease is that
of landlord and tenant. No provision of this Lease shall be construed in
such a way as to constitute Landlord and Tenant joint venturers or
co-partners or to make Tenant the agent of Landlord or to make Landlord
liable for the debts of Tenant.
I. Captions.. The captions used in this Lease are for
convenience only and do not in any way limit or amplify the terms and
provisions hereof.
J. Venue and Choice of Law. All obligations of Landlord and
Tenant under the terms of this Lease shall be payable and performable in
Houston, Xxxxxx County, Texas. The internal local laws of the State of
Texas (not any Texas choice of law rule making applicable the law of some
other jurisdiction) shall govern the construction, interpretation, validity,
performance, and enforcement of this Lease.
K. Severability. If any provision of this Lease should be
held to be invalid or unenforceable, the validity and enforceability of the
remaining provisions of this Lease shall not be affected thereby.
L. Gender.. With respect to terminology in this Lease, each
number (singular or plural) shall include all numbers, and each gender
(male, female or neuter) shall include all genders.
M. Intentionally Deleted .
N. Broker.. Except as stated in Article I.K, neither
Landlord, nor Tenant, shall be responsible for or pay to Broker or any other
party any other fee, commission, or other payment in connection with this
Lease, including, without limitation, fees, commissions, and other payments
for or in connection with any options, renewals, extensions or other
amendments or modifications to this Lease.
O. Acts of God and Force Majeure. Landlord and Tenant, as
applicable, shall not be required to perform any 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 by or prevented by an act of God or force majeure. For purposes of
this Lease, an "act of God" or "force majeure" is defined as strikes,
material or labor restrictions by any governmental authority, riots, floods,
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
Landlord or Tenant, as applicable, and which by the exercise of due
diligence Landlord or Tenant, as applicable, is unable, wholly or in part,
to prevent or overcome.
P. Reasonableness of Approval. Any circumstance in this Lease in
which a matter is subject to Landlord's reasonable approval or which
Landlord agrees not to unreasonably withhold its approval, Landlord shall
be deemed to have been reasonable in denying its approval or consent if
Landlord's lender does not approve of or consent to the requested item.
XXIV. RENEWAL OPTIONS.
A. Options.. Tenant shall have one (1) option ("Renewal Option") to
renew and extend the term of this Lease for a period of five (5) years, as
follows:
B. First Option. Provided that Tenant shall have complied with all
terms and provisions of this Lease during the initial Term, as defined in
Article I.B hereof, and is not then in default thereof, then Tenant shall
have the option ("Renewal Option") to extend the term of this Lease for a
period of sixty (60) months ("Renewal Period") commencing on the day
following the expiration of the initial Term and ending on the last day of
the sixtieth (60th) calendar month thereafter; provided, however, that in
order for Tenant to exercise such option, Tenant shall have given Landlord
written notice of such election by Tenant no later than nine (9) months
prior to the expiration of such initial Term.
D. Notice/Rental Rate. With regard to Tenant's Renewal Option, Tenant
shall, in the event Tenant intends to exercise said option, no earlier than
nine (9) months prior to the expiration of the initial Term, submit a
written request of Landlord to provide Tenant with the good faith opinion of
Landlord as to the Fair Market Value rental rate applicable to the Leased
Premises for the Renewal Period. On or before thirty (30) days after
receipt of such written request, Landlord shall provide to Tenant, in
writing, its good faith opinion as to such Fair Market Value rental rate.
Tenant shall thereupon have thirty (30) days, after receipt of Landlord's
good faith opinion as to the Fair Market Value rental rate, to fully
evaluate such opinion. If Tenant disagrees with such opinion, Tenant shall
serve Landlord with notice of Tenant's good faith opinion as to the Fair
Market Value rental rate at the commencement of the forthcoming extension of
the Renewal Period. Such notice shall be given on or before the expiration
of such thirty (30) day evaluation period and Tenant and Landlord shall then
attempt, in good faith, to agree upon such Fair Market Value. Tenant shall
have the right, exercisable on or before the last day of such thirty (30)
day evaluation period applicable to the Renewal Option, to either (i)
exercise such renewal option by giving written notice to Landlord based on
the Fair Market Value, if any, previously agreed upon by both Landlord and
Tenant, or (ii) exercise such extension option, by written notice to
landlord, without agreement as to the Fair Market Value in which event the
arbitration process, as set forth below, shall be utilized to determine the
Fair Market Value, or (iii) refuse to exercise such extension option either
by notice to Landlord to such effect or by failing to give notice pursuant
to subparagraph B or C as applicable on or before the last date upon which
such Renewal Option may be exercised, in which event Tenant shall have no
further rights to renew or extend this Lease pursuant to this Article XXIV.
E. Arbitration.. The arbitration process to be utilized to determine
the Fair Market Value rental rate, as referenced above, shall be as follows:
(1) Arbitrators. If Tenant calls for arbitration to determine
the Fair Market Value rental rate then, on or before five (5)
days after such notice is given to Landlord, Landlord and
Tenant shall each provide written notice to the other of each
party's final good faith estimate of such Fair Market Value
rental rate ("Final Estimate") of the Leased Premises for the
period commencing when the option in question would commence
and end five (5) years thereafter and each shall
contemporaneously nominate and appoint one (1) arbitrator to
determine such Fair Market Value rental rate. Upon the
appointment of such two (2) arbitrators, said two arbitrators
shall in good faith determine which of the Final Estimates of
Landlord or Tenant most closely equals the Fair Market Value
rental rate as of the commencement date of the First Renewal
Period or Second Renewal Period, as applicable. The two
arbitrators shall afford Landlord and Tenant the right to
submit evidence with respect to their respect Final Estimates
and shall, with all possible speed, make their respective
determinations, in writing, and give notice thereof to both
landlord and Tenant.
(2) Third Arbitrator. If the two arbitrators nominated by the
parties are unable to agree upon which Final Estimate most
closely approximates the Fair Market Value rental rate, then
said arbitrators shall within five (5) days after both of said
arbitrators have made their determinations, appoint, in
writing, a third arbitrator (who shall agree that his/her fee
for services rendered as arbitrators shall not exceed the
higher of the fees charged by the first two arbitrators) and
shall give written notice of such appointment to both Landlord
and Tenant. In the event the arbitrators appointed by the
parties fail to appoint or agree upon such third arbitrator
within said five (5) day period, a third arbitrator shall be
selected by Landlord and Tenant if they so agree within the
further period of five (5) days. If the initial two
arbitrators fail to agree upon the appointment of a third
arbitrator within such time period, then Landlord or Tenant may
apply to any state district court judge of the State of Texas,
in Xxxxxx County, Texas, for the appointment of such arbitrator
and the decision of such judge shall be binding on the
parties. Such third arbitrator shall, in good faith,
determine, pursuant to the procedures set forth herein above,
which of the Final Estimates of the parties most closely equals
the Fair Market Value rental rate. The third arbitrator's
determination of such evaluation shall be controlling and
binding on the parties hereto and shall be completed within
fifteen (15) business days after appointment of the third
arbitrator. When the arbitrators resolve the matter in
dispute, they shall notify the Landlord and Tenant thereof in
writing on or before expiration of the applicable period of
time as set forth above. Such notice shall state the nature of
the dispute and the resolution.
(3) Expenses/Selection. Absent determination to the contrary
by the arbitrators, or a majority thereof, each party shall pay
for the services of the arbitrator it shall appoint and the
parties shall share equally the cost of the services of the
third arbitrator. In the event any arbitrator appointed as
aforesaid shall thereafter die or become unable or unwilling to
act in such capacity, such arbitrator's successor shall be
appointed in the same manner as provided in this Article XXIV
for the appointment of the arbitrator so dying or becoming
unable or unwilling to act. Any arbitrator appointed hereunder
shall be a member in good standing of SIOR or HOLBA or a
similarly recognized organization or association of the office
or industrial leasing business and shall have no less than ten
(10) years experience in the Houston, Texas area in the field
of commercial leasing of the type comparable to the Leased
Premises.
F. Rate.. If this Lease is extended for the Renewal Option as is herein
above provided, then all terms and provisions of this Lease shall apply to
such renewal period except that the Base Rent shall be calculated at the
then Fair Market Value rental rate for the period in question determined as
provided above, and (b) no renewal or extension shall contain any further
renewal or extension option.
Lapse of Options. Time is of the essence with regard to the exercise by
Tenant of the Renewal Option. If such option is not exercised within the
time period stipulated herein above, then such options shall lapse and be of
no further force and effect.
XXV. PURCHASE OPTION
Contingent upon Tenant being in full compliance with all of its
obligations and duties under this Lease, Tenant (or Tenant's nominee), at
any time following the Commencement Date provided that Landlord has
completed construction of the Building, shall have a one-time option
("Option") to purchase the Leased Premises for cash in the amount ("Required
Amount") determined by Landlord as representing the fair market value of the
Leased Premises. Tenant shall exercise the Option by written notice
("Initial Notice") to Landlord of Tenant's election to purchase the Leased
Premises, subject, however, to Tenant's approval of the Required Amount or
Landlord and Tenant agreeing upon an alternate purchase price ("Negotiated
Amount") within thirty (30) days following Tenant's delivery of the Initial
Notice. Within fifteen (15)business days following Landlord's receipt of
the Initial Notice, Landlord will submit the Required Amount in writing
("Landlord's Notice") to Tenant. Tenant shall have fifteen (15) business
days following receipt of Landlord's Notice in which to elect to purchase
the Leased Premises for the Required Amount or Negotiated Amount by written
notice thereof ("Second Notice") to Landlord. If Tenant delivers the Second
Notice, Landlord will prepare an xxxxxxx money contract ("Contract") for
Tenant's approval conveying the Leased Premises in its "as-is" "where-is"
condition, subject to all matters then of record, other than liens
voluntarily created by Landlord which shall be discharged at closing, and
subject to this Lease.
If Tenant does not timely deliver the Second Notice, or if Landlord
and Tenant are unable to agree upon the Negotiated Amount or the form of the
Contract within fifteen (15) business days following Landlord's delivery of
the proposed Contract to Tenant, Tenant's Option shall be deemed canceled
and of no further force and effect. Time is of the essence with respect to
the exercise of the Option.
If Tenant exercises the Option, Tenant shall be responsible for
paying all closing costs, including the premium for the owner's title policy
and all costs and fees in connection with any loan obtained by Tenant to
acquire the Leased Premises, but not Landlord's cost of releasing any liens
voluntarily created by Landlord, including recording fees with respect
thereto.
Notwithstanding anything contained in this Article XXV to the
contrary, in the event that Landlord desires to sell the Leased Premises
subject to this Lease, Landlord may, but shall not be obligated to, first
offer to sell the Leased Premises to Tenant for any price and terms
acceptable to Landlord in its sole and exclusive discretion (the "Proposed
Price"). If Landlord elects to offer the Leased Premises for sale to
Tenant, Tenant shall have fifteen (15) business days following receipt of an
xxxxxxx money contract ("Offer Contract") covering the Leased Premises to
elect to purchase the Leased Premises in accordance with the terms of the
Offer Contract. If Purchaser fails or refuses to timely exercise this
option ("Offer Option") to purchase the Leased Premises, then the Option in
favor of Tenant shall be canceled and of no further force and effect. Any
transfer of the Leased Premises by Landlord to an affiliated entity for tax
or estate planning purposes shall not obligate Landlord to offer the Leased
Premises to Tenant, but such transfer and conveyance shall be subject to the
terms of this Article XXV.
Page 64
No real estate commission shall be payable with respect to Tenant's
acquisition of the Property from Landlord. The closing of the purchase, if
Tenant elects to exercise the Option or Offer Option, as applicable, shall
be not more than thirty (30) days following the execution of the Contract or
Offer Contract, as applicable, between Landlord and Tenant.
EXECUTED in multiple counterparts, each having the force and effect of an
original, on January 25, 1999.
CLAY DEVELOPMENT & CONSTRUCTION, INC., a Texas corporation
By: /s/ Xxxxxx X. Xxxx
Name: Xxxxxx X. Xxxx
Title: Vice President
LANDLORD
Horizon High Reach, Inc., a ______corporation
By: /s/ Xxxx Xxxxxxx
Name: Xxxx Xxxxxxx
Title: General Manager - Vice President
TENANT
Exhibit "B"
PLOT PLAN SHOWING LOCATION OF LEASED PREMISES
Exhibit "A"
LEGAL DESCRIPTION OF LAND
(LAND ON WHICH BUILDING WILL BE SITUATED)
Exhibit "C"
LANDLORD'S WORK
Landlord's obligation to perform construction work at the Leased Premises is
limited to the work described in the following plans and specifications:
NOTABLE EASEMENTS, PIPELINES AND OTHER IMPEDIMENTS TO THE LAND
EXHIBIT "D"
EXHIBIT "E"
ESTOPPEL CERTIFICATE
Re: Lease between Clay Development & Construction, Inc. ("Landlord")
and HORIZON HIGH REACH, INC. ("Tenant") dated December __, 1998 ("Lease")
with respect to the land and building located at ________________________
_________________________in _________, Texas (the "Premises")
Gentlemen:
We, the undersigned Tenant, under the Lease described above (the
"Lease"), certify to ___________________ and its successors and assigns as
the prospective purchaser of the Premises ("Purchaser"), the following:
1. Attached hereto as Exhibit "A" is a true, correct, and
complete copy of the Lease, including all amendments, exhibits, and Addenda
thereto.
2. There has not been a cancellation, modification,
assignment, renewal, extension, or amendment to the Lease, except the
following (true and correct copies of all of which are attached hereto and
initialed by Tenant):
3. All of the Base Rent and Initial Estimate of Monthly Taxes
and Insurance Payment provided in the Lease to be paid has been paid through
___________________, 1999.
4. Other than the Lease, there are no other agreements, written or
oral, between Landlord and Tenant regarding the Premises or Tenant's
obligation to pay rentals under the Lease, and Tenant does not claim a right
to any concessions, free rent, or rental abatement other than as set forth
in the Lease, except as follows:
________________________________________________.
5. Tenant currently pays for utilities used in the Premises
by making payments to: ________________________________
______________________________.
6. The Lease commenced on ______________, 19___, and the rent
commenced on ___________________, 19___. The Lease terminates on
__________________, 19___, and Tenant is not entitled to any renewal options
except two (2) options to extend, of sixty (60) months each. By the
exercise of all such renewal options, Tenant may extend the Lease until
_____________, _____.
7. The Lease is in full force and effect and Tenant does not
have any presently existing claims against Landlord or any offsets against
rent due under the Lease. To the actual knowledge of Tenant, there are no
(i) defaults of Landlord or Tenant under the Lease, (ii) existing
circumstances which with the passage of time, or notice, or both, would give
rise to a default by Landlord or Tenant under the Lease, (iii) existing
rights to xxxxx, reduce or offset sums against rent or terminate this Lease
because of any other condition, or (iv) existing circumstances which with
the passage of time, or notice, or both, would give rise to a right to
xxxxx, reduce or offset sums against rent or terminate the Lease.
8. The Premises have been completed and accepted and are in
conformity with the terms of the Lease, subject to the (i) Landlord's
warranty and repair obligation contained in the Lease solely with respect to
the roof, foundation and load-bearing walls supporting the roof of the
building, (ii) general contractor's warranty obligations to the Tenant and
(iii) liability of the architect and any engineers to the Tenant for design
defects. Tenant has been paid all sums (if any) owed by Landlord with
respect to allowances for construction performed at the Premises by Tenant.
9. The Tenant has not filed a petition in bankruptcy that has
not been dismissed as of the date hereof, has not been subject to an
involuntary petition in bankruptcy which has not been dismissed, has not
made an assignment for the benefit of any creditor(s), or has not been
adjudged to be bankrupt or insolvent by a court of competent jurisdiction.
10. The Tenant has not received any option to purchase any
portion of the Premises, except as follows:
__________________________________________________________
______________________________________________________________________________
_____________________________________________________________________________.
11. Any notices which may or shall be given to Tenant under
the terms of the Lease are to be sent to Tenant at the following address:
_________________________________
______________________________________________________________________________
_____________________________________________________________________________.
12. The undersigned has all requisite authority to execute
this Estoppel Certificate on behalf of Tenant. The undersigned acknowledges
that Purchaser has requested the information contained herein for purposes
of confirming and clarifying certain provisions of the Lease and is relying
(and will rely) on the truth and accuracy of the representations made herein
and upon the authority of the undersigned to execute this Estoppel
Certificate on behalf of Tenant, in connection with Purchaser's decision to
purchase (or not to purchase) the Premises. This Estoppel Certificate may
only be relied upon by Purchaser and Purchaser's lender in connection with
the acquisition and financing of the Premises, and no other person or entity
shall be entitled to be a third-party beneficiary of this Estoppel
Certificate.
Very truly yours,
HORIZON HIGH REACH, INC.
By:
Name: /s/ Xxxx Xxxxxx
Title: General Manager - Vice President
Date: January 25, 199
Exhibit "F"
RULES & REGULATIONS
1. All floor areas and other improvements in or on the Leased Premises
(including, without limitation, entrances and returns, doors,
fixtures, windows, aisles, and displays) shall be maintained in a
safe, neat, clean, and attractive condition.
2. No person shall use the parking areas except for ingress and egress
and for the parking of motor vehicles during the period of time
such persons or the occupants of such vehicles are customers or
business invitees or employees of the establishments within the
Leased Premises. No sidewalks, walkways, or halls shall be used
other than for pedestrian travel. No roadways, walkways,
sidewalks, halls, parking areas, or other open areas shall be used
by skateboards, roller blades, roller skates, or other moveable
contrivances, except for or by handicapped persons.
3. All motor vehicles located in the parking lot shall be parked in an
orderly manner within the painted lines defining the individual
parking spaces, except that trucks may be parked elsewhere on the
Leased Premises in an orderly manner.
4. No person shall do any of the following:
1. Throw, discard, or deposit any paper, glass, or extraneous matter
of any kind, except in designated receptacles, or create
litter or hazards of any kind on or in any part of the
Leased Premises;
2. Deface, damage, or demolish any sign, light standard or
fixture, landscaping material, or other improvement within
the Leased Premises.
5. No sign or covering shall be inscribed, displayed, printed,
affixed, or hung on or to, or placed in or used in connection with,
any window or door located on or within the Leased Premises without
the prior written consent of Landlord. Landlord shall have the
right to remove any such sign or covering that violates this
provision without notice to and at the expense of Tenant.
6. Landlord reserves the right to exclude or expel from the Leased
Premises, any person who, in Landlord's judgment, is or appears to
be intoxicated or under the influence of liquor or drugs, or is in
violation of any of these Rules and Regulations.
7. Tenant shall comply with all safety, fire protection, and
evacuation procedures and regulations established by Landlord, its
insurance carriers, or any governmental agency.
8. Landlord reserves the right to restrict the use of all electrical
extension cords. At no time shall more than two electrical devices
be connected to any single electrical outlet. Multiple adapters
are prohibited. Any extension cord used must be a two-wire cord
with a ground, and must be sized according to the power draw on the
circuit.
9. The plumbing fixtures shall be used only for the purposes for which
they are designed, and no sweepings, rubbish, rags, or other
unsuitable materials shall be disposed into them. Without the
prior written consent of Landlord, nor shall Tenant use the Leased
Premises for washing clothes, lodging, or for any improper,
objectionable, or immoral purposes. No cooking shall be done or
permitted by Tenant on the Leased Premises, other than cooking for
Tenant's employees and visitors, including, without limitation,
events hosted by Tenant at the Leased Premises.
10. Neither Tenant nor its employees, agents, contractors,
subcontractors, or invitees shall go upon the roof of the Leased
Premises without Landlord's prior written consent.
11. Landlord will furnish each Tenant with an initial set of keys free
of charge. Landlord may make a reasonable charge for any
additional keys. Tenant shall not have any keys made except by
Landlord. Tenant shall not alter any lock or install a new or
additional lock or bolt on any door of its Leased Premises without
prior written consent of Landlord, which consent will not be
unreasonably withheld. If Landlord shall give its consent, Tenant
shall in each case furnish Landlord with a key for any such lock.
Each Tenant, upon the termination of its tenancy, shall deliver to
Landlord all keys to doors and other areas in the Leased Premises.
12. Tenant shall not sell or regularly serve alcoholic beverages on the
Leased Premises without the prior written consent of Landlord.
13. The Leased Premises shall be used only for the purposes set forth
in the Lease and such use shall be limited to the period of time
and activities specified therein.
14. Each Tenant shall store all its trash and garbage within its Leased
Premises or in the dumpsters or other contained areas provided by
Landlord, if any. No material shall be placed in the trash cans or
receptacles if such material is of such nature that it may not be
disposed of in the ordinary and customary manner of removing and
disposing of trash and garbage in the City of Houston, without
being in violation of any law or ordinance governing such
disposal. All garbage and refuse disposal shall be made only
through entryways provided for such purpose and at such times as
Landlord shall designate. Large containers and any non-compactable
trash shall be kept in the Leased Premises until such time as
Tenant has made suitable arrangements for its removal. In no event
shall Tenant's trash be visible to the general public or constitute
any health, fire hazard, or nuisance to the public. No burning of
trash, refuse, or waste shall be permitted.
15. These Rules and Regulations are in addition to, and shall not be
construed to in any way modify, alter, or amend, in whole or in
part, the terms, covenants, agreements, and conditions of the Lease
to which these Rules and Regulations are attached. Landlord
reserves the right to rescind or waive any of the rules and
regulations set forth herein (as to an individual tenant or as to
all the tenants) and to make such other and further rules and
regulations as in its feasible judgment shall, from time to time,
be required for the safety, protection, care, and cleanliness of
the Leased Premises, the operation thereof, the preservation of
good order therein, or the protection and comfort of the Tenant and
their agents, employees, and invitees. Such rules and regulations,
when made and written notice thereof is given to a tenant, shall be
binding upon it in like manner as if originally herein prescribed.
Exhibit "G"
OFFICE AND WAREHOUSE DETAIL FLOOR PLAN
Exhibit "H"
HAZARDOUS SUBSTANCES
1. Tenant shall not cause or permit any Hazardous Substance (as
hereinafter defined) to be brought upon, generated, manufactured,
refined, produced, processed, kept, stored, discharged, disposed
of, leaked, emitted, or used (collectively herein called "Processed
and Stored") in, or about the Leased Premises, except for such
Hazardous Substances as is necessary or useful to Tenant's business
and the use of which is expressly approved by Landlord in writing.
Landlord shall have no obligation to grant any such approval;
provided, however, that Landlord hereby approves of Tenant's use of
the substances and materials as described in Exhibit H-2 attached
hereto and made part hereof for all purposes (the "Approved
Substances").
2. The Approved Substances and, if Landlord consents as provided in
paragraph 1 above, any other Hazardous Substance permitted on the
Leased Premises, and all containers therefor, shall be Processed
and Stored in a manner that complies with all Governmental Laws (as
hereinafter defined) applicable to Hazardous Substances.
3. Tenant shall not cause or permit any material or substance to be
Processed or Stored in, on or about the Leased Premises, or the
atmosphere, ground, sewer system, or any body of water, if that
material (as is reasonably determined by the Landlord, or any
governmental authority) does or may pollute or contaminate the
same, or may adversely affect (a) the health, welfare, or safety of
persons, whether located on the Leased Premises, or elsewhere, or
(b) the condition, use, or enjoyment of the Building or any other
real or personal property.
4. Tenant shall not cause or permit to occur any violation of any
governmental law on, in, under, or about the Leased Premises,
arising from Tenant's use, occupancy, or possession of the Leased
Premises, including, but not limited to, soil and ground water
conditions.
5. As used herein, the term "Hazardous Substance" means (a) any
"hazardous waste" as defined by the Resource Conservation and
Recovery Act of 1976, as amended from time to time, and regulations
promulgated thereunder; (b) any "hazardous substance" as defined by
the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended from time to time, and
regulations promulgated thereunder; (c) any oil, petroleum
products, and their by-products (d) any substance that is or
becomes regulated by a federal, state or local governmental
authority; (e) any other ignitable, reactive, corrosive, hazardous,
toxic, flammable, explosive, radioactive material, asbestos,
asbestos containing material, polychlorinated biphenyl, chemical
known or suspected to cause cancer or reproductive toxicity,
pollutants, contaminates, hazardous wastes, controlled drugs or
substances (except prescription drugs pursuant to existing
prescriptions), (f) any substance or material declared to be
hazardous or toxic under any statute, law, regulation, code,
ordination rule or governmental pronouncement now or hereafter
enacted or promulgated by any governmental authority (herein called
"Governmental Laws") or (g) dangerous substance or material.
6. Tenant shall, at Tenant's own expense, comply with Governmental
Laws relating to or regulating the bringing upon, generating,
manufacturing, refining, producing, processing, keeping, storing,
discharging, disposing of, leaking, emitting, or using
(collectively herein called "Processing and Storing") of Hazardous
Substances that occur during the term of the Lease.
7. Tenant shall, at Tenant's own expense, make all submissions to,
provide all information required by, and comply with all
requirements of any governmental authority (the "Authority") under
the Governmental Laws.
8. Should any Authority or any third party demand that a clean-up plan
be prepared and that a clean-up be undertaken because of the
Processing and Storing of Hazardous Substances by Tenant that
occurs during the term of this Lease, at or from the Leased
Premises, or which arises at any time from Tenant's use or
occupancy of the Leased Premises, then Tenant shall, at Tenant's
own expense, prepare and submit the required plans and all related
bonds and other financial assurances; and Tenant shall carry out
all such clean-up plans.
9. Tenant shall promptly provide all information regarding the
Processing and Storing of Hazardous Substances that is requested by
Landlord.
10. If Tenant fails to fulfill any duty imposed under this Exhibit "H"
within a reasonable time, Landlord may do so; and in such case,
Tenant shall cooperate with Landlord in order to prepare all
documents Landlord deems necessary or appropriate to determine the
applicability of the Governmental Laws to the Premises and Tenant's
use, occupancy or possession thereof, and for compliance therewith,
the Tenant shall execute all documents promptly upon Landlord's
request. No such action by Landlord and no attempt made by
Landlord to mitigate damages under any law shall constitute a
waiver of any of Tenant's obligations under this Exhibit "H".
11. Tenant hereby agrees that it shall be fully liable for all costs
and expenses related to any Processing and Storage of Hazardous
Substances by Tenant in, on, under or about the Leased Premises and
the Tenant shall give immediate notice to the Landlord of any
violation or potential violation of the provisions of Exhibit "H"
or any Governmental Laws. Tenant shall defend, indemnify, and hold
harmless Landlord, its agents, employees and managers, and their
respective partners, agents, employees, officers, directors,
beneficiaries, shareholders, partners, consultants and advisers
from and against all claims, demands, penalties, fines, suits,
causes of action, liabilities, settlements, damages, costs,
expenses (including, without limitation, attorneys and consultants
fees, court costs, and litigation expenses), or losses (including,
without limitation, a decrease in value of the Leased Premises or
usable space) of whatever kind or nature, known or unknown,
contingent or otherwise, arising out of or in any way related to,
arising out of or in connection with or which is alleged to have
arisen out of or in connection with any violation or alleged
violation by Tenant of any covenant contained in this Exhibit "H".
12. The provisions of this Exhibit "H" shall be in addition to any
other obligations and liabilities Tenant may have to Landlord at
law or equity and shall survive the transactions contemplated
herein and shall survive the termination of this Lease.
EXHIBIT "H-2"
Tenant's Substances and Materials
Gasoline
Diesel
Motor Oil
Hydraulic Oil
Propane
Battery/ Battery Acid
Parts Washer
Paint
Cleaning Supplies
EXHIBIT "I"
PROHIBITED USES
General Restrictions on Use.
No portion of the Land shall be used, leased, subleased, or operated for:
(1) retail automotive repair, retail car wash, retail
gasoline sales, or retail tire or battery sales;
(2) the renting, leasing, sale or display of any
non-commercial use truck, trailer, recreational vehicle or
boats which are on premises; however, nothing shall
prevent any such renting, leasing, or sale if the
vehicles, trucks, trailers or boats are located at another
site;
(3) any use which emits an obnoxious odor, common noise or
sound, as proven by court proceedings, which can be heard
or smelled outside of any building located in or on the
Land or which creates unusual fire, explosive or other
risks to any portion of the Land;
Regarding items (1) thru (3), Landlord recognizes that Tenant is in the
commercial high lift sales, leasing and repair business.
(4) any mobile home park, trailer park, labor camp, or junkyard (except
this provision shall not prohibit the temporary use of construction
trailers during periods of construction, reconstruction or
maintenance);
(5) any dumping, disposing, incinerating or reduction of garbage
(exclusive of garbage compactors located near the rear of any
building) except any recycle centers required by governmental
regulations;
(6) any living quarters, sleeping apartments or lodging rooms;
(7) any veterinary hospital or animal raising facility (except
this provision shall not prohibit a pet shop);
(8) any mortuary or funeral home;
(9) any establishment whose primary business is the sale or rental
or display of sexual materials or drug related paraphernalia or
whose primary business is providing any adult only or sexually
oriented service or product including, but not limited to, massage
parlors, brothels, topless establishments, any "sex" shop, "peep
show", any "adult" bookstore or "adult" movie theater;
(10) any flea market, amusement park (except an enclosed
children's playground operated in conjunction with a fast food
restaurant), video arcade, pool or billiard hall.
(11) any gaming facility or operation including, but not limited
to, off-track or sports betting parlor, table games such as
blackjack, poker, slot machines, video poker, blackjack, keno
machines or similar devices or bingo hall. Notwithstanding the
foregoing, this prohibition shall not apply to any government
sponsored gaming activities or charitable gaming activities so long
as such governmental or charitable activities are incidental to the
business being conducted by any occupant of the Land;
(12) any central laundry, dry cleaning plant or laundromat;
provided, however, this prohibition shall not be applicable to a
laundry which is an ultimate consumer pickup and delivery site,
provided no cleaning actually takes place upon the Land;
(13) the operation, establishment or maintenance of a movie
theater, children's playground (except an enclosed or fenced
playground operated in connection with a fast food restaurant)
night club, bowling alley, skating or roller rink, health spa (but
the same shall not include a dance or aerobic studio which does not
exceed 1,500 square feet of floor area), a second hand or pawn shop
type of business or other entertainment facilities, or any use in
violation of applicable zoning and other governmental laws and
regulations;
(14) any use which is a public or private nuisance;
(15) distilling, refining, smelting, agricultural, animal raising
or boarding (other than consumer pet shops), or mining operation;
(16) any place for public assembly (such as a church or meeting
hall); or
FORM OF CHANGE ORDERS
LEASE
BETWEEN
CLAY DEVELOPMENT & CONSTRUCTION, INC.,
a Texas corporation
AND
HORIZON HIGH REACH, INC.,
a _______ corporation
for property located at:
Hwy. 288 and Beltway 8
TABLE OF CONTENTS
I. BUSINESS TERMS AND AGREED
DEFINITIONS -1-
II. Acquisition of Leased Premises
-4-
III. Tender Date and Conditions -13-
IV. Rent -13-
V. Taxes and Insurance -14-
VI. Security Deposit -15-
VII. Utilities -15-
VIII. Use -15-
IX. Signs -16-
X. Repairs -17-
XI. Casualty Damage -19-
XII. Condemnation -21-
XIII. Insurance -21-
XIV. Assignment and Subletting -23-
XV. Landlord's Lien -25-
XVI. Default -26-
XVII. Holdover -29-
XVIII. Notice -30-
XIX. Limitation of Liability -30-
XX. Inspection and Access to Leased
Premises -30-
XXI. Mortgage -31-
XXII. Non-Liability -31-
XXIII. Miscellaneous -31-
XXIV. Renewal Options -34-
XXV. Option to Purchase -35-
