EXHIBIT 10(t)
OFFICE LEASE AGREEMENT
between
LAKE AUSTIN COMMONS, LTD.
("Landlord")
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and
Clinicor, Inc.
("Tenant")
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for
HARTLAND PLAZA
ARTICLE 1 1
1.01 Date of Lease.......................................1
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1.02 Landlord............................................1
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1.03 Tenant..............................................1
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1.04 Building............................................1
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1.05 Premises............................................1
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1.06 Term................................................1
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1.07 Commencement Date...................................1
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1.08 Expiration Date.....................................1
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1.09 Base Rent...........................................1
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1.10 Tenant's Pro Rata Share.............................1
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1.11 Base Operating Expense..............................1
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1.12 Security Deposit....................................1
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1.13 Prepaid Rent........................................1
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1.14 Permitted Use.......................................1
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1.15 Guarantor(s)........................................1
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1.16 Tenant's Broker.....................................1
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1.17 Addresses...........................................1
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1.18 Tenant Improvement Allowance........................1
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1.19 Work Letter.........................................1
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1.20 Service Charges.....................................1
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1.21 Tenant's Minimum Insurance Requirements.............1
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ARTICLE 2 2
2.01 Premises............................................2
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2.02 Term and Commencement...............................2
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2.03 Early Possession....................................2
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2.04 Late Possession.....................................2
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ARTICLE 3 2
3.01 Base Rent...........................................2
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3.02 Rental Adjustment...................................3
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3.03 Operating Expenses..................................3
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3.04 Service Charges.....................................3
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3.05 Security Deposit....................................3
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3.06 Tenant Improvement Fee..............................3
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ARTICLE 4 4
4.01 Use.................................................4
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4.02 Hazardous Substances................................4
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ARTICLE 5 4
5.01 Landlord's Services.................................4
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5.02 Additional Service Cost.............................4
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5.03 Service Interruption................................4
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ARTICLE 6 5
6.01 Alterations.........................................5
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6.02 Tenant Repairs......................................5
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6.03 Landlord Repairs....................................5
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6.04 Signage.............................................5
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ARTICLE 7 5
7.01 Landlord Insurance..................................5
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7.02 Tenant Insurance....................................5
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7.03 Waiver of Subrogation...............................5
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7.04 Indemnity...........................................6
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ARTICLE 8 6
8.01 Casualty............................................6
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ARTICLE 9 6
9.01 Condemnation........................................6
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ARTICLE 10 6
10.01 Entry...............................................6
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ARTICLE 11 6
11.01 Subordination.......................................6
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11.02 Attornment..........................................6
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11.03 Quiet Enjoyment.....................................7
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ARTICLE 12 7
12.01 Assignment and Subletting...........................7
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12.02 Continued Liability.................................7
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12.03 Consent.............................................7
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12.04 Proceeds............................................7
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ARTICLE 13 7
13.01 Default.............................................7
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13.02 Rights Upon Default.................................7
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13.03 Costs...............................................9
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13.04 Landlord's Lien.....................................9
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13.05 Non-Waiver..........................................9
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ARTICLE 14 9
14.01 Organization and Power (Corporation)................9
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14.02 Organization and Power (Partnership or
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Joint Venture)......................................9
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ARTICLE 15 9
15.01 Amendment...........................................9
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15.02 Severability........................................9
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15.03 Estoppel Letters....................................9
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15.04 Landlord's Liability and Authority..................9
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15.05 Holdover............................................9
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15.06 Surrender..........................................10
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15.07 Parties and Successors.............................10
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15.08 Notice.............................................11
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15.09 Rules and Regulations..............................11
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15.10 Captions...........................................11
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15.11 Number and Gender..................................11
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15.12 Governing Law......................................11
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15.13 Inability to Perform...............................11
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15.14 Broker.............................................11
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15.15 Memorandum of Lease................................11
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15.16 Entire Agreement...................................11
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15.17 Time of Essence....................................11
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15.18 Parking............................................11
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15.19 Tenant Taxes.......................................11
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15.20 Attorney's Fees....................................11
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15.21 Landlord Alterations or Modifications..............11
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15.22 Name Change........................................10
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15.23 Publication........................................11
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15.24 Substitution of Premises...........................11
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15.25 DTPA Waiver........................................11
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EXHIBIT A Floor Plans
EXHIBIT A-1 Legal Description
EXHIBIT B Rules and Regulations
EXHIBIT C Parking
EXHIBIT D Commencement Date Declaration
EXHIBIT E Work Letter
EXHIBIT F Renewal Option
EXHIBIT G Right of First Refusal
OFFICE LEASE AGREEMENT
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HARTLAND PLAZA
This Office Lease Agreement (this "Lease") is entered into between the
Landlord and the Tenant named below.
ARTICLE I
This Article contains definitions of certain terms used in this Lease,
set forth as follows:
1.01 Date of Lease: October 23, 1996
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1.02 Landlord: LAKE AUSTIN COMMONS, LTD., a Texas limited partnership
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1.03 Tenant: Clinicor, Inc.
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1.04 Building: The building known as Hartland Plaza, 1717 West 6th
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Street, Xxxxxx County Texas, located on the land more particularly described in
Exhibit A-1 attached hereto, together with Landlord's rights in any present or
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future associated underground or elevated pedestrian tunnels or walkways (all of
such land, improvements and rights being hereafter collectively referred to as
the "Project").
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1.05 Premises: The space cross hatched in Exhibit A attached hereto,
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located on the 4th floor of the Building and containing 15,180 square feet of
net rentable area.
1.06 Term: 5 years, commencing on the Commencement Date and ending at
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midnight on the Expiration Date.
1.07 Commencement Date: The "Commencement Date" shall be the earlier of
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the date Tenant begins operating its business in the Premises or 15 days after
the "substantial completion date" as stated in the Work Letter. The Commencement
Date shall constitute the commencement of the Term of this Lease for all
purposes, whether or not Tenant has actually taken possession; provided,
however, if the Commencement Date of the term of this Lease has not occurred by
January 15, 1997 because construction, or improvements being made or to be made
by Landlord are not substantially completed, then (i) Rent shall xxxxx for the
period that possession by Tenant is delayed unless Tenant caused (in whole or in
part) such delay, in which case Rent shall not xxxxx, (ii) for each day that
Landlord is unable to give possession of the Premises to Tenant (except for
delays caused in whole or in part by Tenant), then Landlord shall pay to Tenant
a penalty of six hundred dollars ($600.00) for each day of such delay, and (iii)
if such improvements are not substantially completed by February 15, 1997
(except for delays caused in whole or in part by Tenant), Tenant may terminate
this Lease by delivering written notice of termination to Landlord prior to the
substantial completion of such improvements, but under no circumstances shall
Landlord be responsible for direct or consequential damages because of its
inability to complete such improvements or furnish possession of the Premises to
Tenant by any particular date.
1.08 Expiration Date: 5 years after the Commencement Date.
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1.09 Base Rent: Base Rent for each square foot of net rentable area in
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the Premises shall be $13.83 for the first year of the Term of this Lease,$14.33
for the second year of the Term of this Lease, $14.83 for the third year of the
Term of this Lease, $15.33 for the fourth year of the Term of this Lease, $15.83
for the fifth year of the Term of this Lease, payable in advance in equal
monthly installments (the initial monthly installments shall be $18,127.45 each,
subject to adjustment annually thereafter).
1.10 Tenant's Pro Rata Share: 9.07%, which is the proportion, expressed
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as a percentage, that the square feet of net rentable area in the Premises bears
to the total number of square feet of net rentable area in the Building.
1.11 Base Operating Expense: An amount per square foot of net rentable
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area equal to (i) the aggregate Operating Expenses (hereinafter defined) paid or
incurred by Landlord during the 1997 calendar year, divided by (ii) the total
number of square feet of net rentable area in the Building.
1.12 Security Deposit: $0 (See Section 3.05 (b) hereof).
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1.13 Prepaid Rent: $18,127.45
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1.14 Permitted Use: Administrative, clerical and other general office
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uses related to Tenant's drug approval business, and for no other use
whatsoever.
1.15 Guarantor(s): N/A.
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1.16 Tenant's Broker: Insignial Commercial Group, Inc.
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1.17 Addresses:
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Landlord's Address:
Lake Austin Commons, Ltd.
C/O Sage Land Company, Inc.
0000 X. 0xx Xxxxxx
Xxx. 000
Xxxxxx, XX 00000
Tenant's Address:
Clinicor, Inc.
0000 X. 0xx Xxxxxx
Xxxxx 000
Xxxxxx, XX 00000
Manager's Address:
Pyramid Properties, Inc.
0000 X. 0xx Xxxxxx
Xxx. 000
Xxxxxx, XX 00000
1.18 Tenant Improvement Allowance: $185,955
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1.19 Work Letter: If improvements are to be erected upon the Premises,
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the construction shall be performed pursuant to the Work Letter attached hereto
as Exhibit E .
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1.20 Service Charges.
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(a) Late Payment Charge: An amount equal to five percent (5%) of any
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installment of Rent and other charges past due for more than five
(5) days; interest on such past due installment and late payment
charge shall accrue at the rate of eighteen percent (18%) per
annum after the 30th day such installment is past due until paid.
(b) Returned Checks: $35 for each returned check.
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1.21 Tenant's Minimum Insurance Requirements.
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(a) Personal Property: Full replacement value.
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(b) Liability: $1,000,000.00 combined single limit.
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(c) Worker's Compensation: Statutory amount.
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(d) Employer's Liability: $500,000.00
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Each of the foregoing provisions and defined terms shall be construed
in conjunction with the references thereto contained in the other provisions of
this Lease and shall be limited by such other provisions. Each reference in this
Lease to any of the foregoing provisions and defined terms shall be construed to
incorporate each term set forth above.
ARTICLE 2
2.01 Premises. Subject to and upon the terms, provisions and conditions
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set forth herein, and in consideration of the duties, covenants and obligations
of Lessee hereunder, Landlord hereby leases to Tenant, and Tenant hereby leases
from Landlord, the Premises.
The term "net rentable area", as used herein, shall refer to (i) in the
case of a floor leased to a single tenant, all floor area measured from the
inside surface of the outer glass line of the Building to the inside surface of
the opposite outer glass line, excluding only Service Areas and General Common
Areas (defined below), plus an allocation of the square footage of the General
Common Areas, and (ii) in the case of a floor leased to more than one tenant,
all floor areas within the inside surface of the outer glass line of the
Building enclosing the Premises and measured to the mid-point of demising walls
(i.e., walls separating the premises from areas leased to or held for lease to
other tenants, from On-Floor Common Areas (defined below) and from General
Common Areas), excluding only Service Areas, plus an allocation of the square
footage of the General Common Areas and an allocation of the square footage of
the On-Floor Common Areas. No deductions from net rentable area shall be made
for columns or projections necessary to the Building. It is agreed between the
parties hereto that the square footage of the Premises shall be as stated in
Section 1.05 hereof and shall be considered final for all purposes under this
Lease.
"Service Areas" shall mean the areas within (and measured from the
mid-point of the walls enclosing) Building stairs, fire towers, elevator shafts,
flues, vents, stacks, pipe shafts and vertical ducts. Areas for the specific use
of Tenant and installed at the request of Tenant such as special stairs or
elevators are not included within the definition of Service Areas.
"General Common Areas" shall mean those areas within (and measured from
the mid-point of the walls enclosing) the Building's elevator machine rooms,
main mechanical and electrical rooms, public lobbies, management office and
other areas not leased or held for the proper utilization of the Building or to
provide customary services to the Building. The allocation of the square footage
of the General Common Areas shall be equal to the total General Common Area
within the Building multiplied by a fraction, the numerator of which is the net
rentable area of the Premises (excluding only the allocation of the General
Common Areas) and the denominator of which is the net rentable area (excluding
only the General Common Areas) of all office space leased or held for lease in
the Building.
"On-Floor Common Areas" shall mean all areas within (and measured from
the mid-point of the walls enclosing) public corridors, elevator foyers, rest
rooms, mechanical rooms, janitor closets, telephone and equipment rooms, and
other similar facilities for the use of all tenants on the floor on which the
Premises are located. In the case of a floor leased to more than one tenant, the
allocation of the square footage of the On-Floor Common Areas on said floor
shall be equal to the total On-Floor Common Areas on said floor multiplied by a
fraction, the numerator of which is the net rentable area of the portion of the
Premises (excluding the allocation of the General Common Areas and excluding the
allocation of the On-Floor Common Areas) located on said floor and the
denominator of which is the net rentable area of all office space on said floor
(excluding the allocation of General Common Areas and the allocation of the
On-Floor Common Areas).
By moving into the Premises or taking possession thereof, Tenant
acknowledges that a full and complete inspection of the Premises, the General
Common Areas and the On-Floor Common Areas has been made and Landlord has fully
and adequately disclosed the existence of any defects which would interfere with
Tenant's use of the Premises for their intended purpose. Tenant specifically
acknowledges that as a result of such inspection and disclosure, Tenant has
taken possession of the Premises and has made its own determination to fully
accept the same in their "AS IS" condition, except for latent defects. In
further consideration of such inspection and disclosure, Landlord hereby
disclaims any representation or warranty and Tenant, to the maximum extent
permitted by law, waives all claims for misrepresentation, breach of warranty or
unconscionable acts as to the Premises, the Building and the Project, whether
express or implied, including, without limitation, any implied warranty of
suitability.
2.02 Term and Commencement. Subject to the other provisions hereof,
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this Lease shall be for the period equal to the Term set forth in Section 1.06
hereof.
Within five (5) days after the Commencement Date and at any time
thereafter upon the request of Landlord, Tenant shall execute and deliver to
Landlord a declaration (in the form attached hereto as Exhibit D) specifying the
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date upon which the same occurred.
2.03 Early Possession. In the event Tenant enters the Premises prior to
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the Commencement Date, Tenant shall execute and deliver to Landlord a hold
harmless agreement in a form provided by Landlord whereby Tenant releases
Landlord from all liabilities, claims and causes of action arising out of any
construction or other work performed at the Premises and agrees to pay utility
charges incurred by Tenant during such early possession.
2.04 Late Possession. No delay in the completion of the Premises
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resulting from any delay or failure on the part of Tenant, including delay in
furnishing information, work or other matters required in Exhibit E, shall delay
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the Commencement Date or Expiration Date.
ARTICLE 3
3.01 Base Rent. Tenant, in consideration for this Lease, agrees to pay
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to Landlord the monthly Base Rent set forth in Section 1.09 hereof, payable in
legal tender of the United States of America at Landlord's address or at such
place or to such agent as Landlord may from time to time designate in writing,
without notice, demand, deduction, counterclaim, set-off or abatement, in
advance on the first day of each calendar month throughout the Term, except that
the amount of prepaid rent set forth in Section 1.13 hereof is due upon the date
of execution of this Lease by Tenant.
3.02 Rental Adjustment. On or before the first day of each calendar
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year of the Term, Landlord shall provide to Tenant the Estimated Operating
Expense Increase (defined in Section 3.03 hereof) for the upcoming year. In
addition to the Base Rent, Tenant shall pay as a rental adjustment in advance on
the first day of each calendar month during the Term, installments equal to
one-twelfth (1/12) of Tenant's Pro Rata Share of the Estimated Operating Expense
Increase. Within one hundred twenty (120) days, or as soon thereafter as
practicable, after the end of each calendar year during the Term, Landlord shall
furnish to Tenant a statement certified by Landlord of the Actual Operating
Expense Increase (defined in Section 3.03 hereof) for the immediately preceding
calendar year, which statement shall specify the various types of Operating
Expenses and set forth Landlord's calculations of Tenant's Pro Rata Share
thereof. If Tenant's Pro Rata Share of the Estimated Operating Expense Increase
paid to Landlord during the previous calendar year exceeds Tenant's Pro Rata
Share of the Actual Operating Expense Increase, then Landlord shall credit the
difference to Tenant against the next due installment of Tenant's Pro Rata Share
of the Estimated Operating Expense Increase. Otherwise, within thirty (30) days
after Landlord furnishes such statement to Tenant, Tenant shall make a lump sum
payment to Landlord equal to Tenant's Pro Rata Share of the positive difference
between the Actual Operating Expense Increase and the Estimated Operating
Expense Increase theretofore paid by Tenant. As used in this Lease, the term
"Rent" shall refer collectively to the Base Rent and all rental adjustments. If
the Term commences on a day other than the first day of the month or calendar
year, or terminates on a day other than the last day of a month or calendar
year, then Tenant shall be required to pay only a pro rata share of the
installments and adjustment of Rent due for such month or year.
3.03 Operating Expenses. "Operating Expenses" shall mean and include
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all amounts, expenses, and costs of whatever nature paid or incurred by Landlord
because of or in connection with the ownership, management (including management
by a third party under a contract with Landlord), operation, repair, maintenance
or security of the Project, all additional facilities that may be added to the
Project, and Landlord's personal property that may be utilized in connection
therewith. Operating Expenses shall include, without limitation, (i) all general
and special real estate taxes, special assessments and other ad valorem taxes,
levies and assessments payable with respect to any portion of the Project and
all taxes or other charges imposed in lieu of any such taxes (including fees of
counsel and experts which are incurred by, or reimbursable by, Landlord in
seeking any reduction in the assessed valuation of any portion of the Project),
(ii) reasonable management office expenses, (iii) applicable sales and use
taxes, (iv) costs of insurance, (v) trash collection service, janitorial
service, pest control and security service, (vi) salaries, wages, benefits and
other personnel costs of engineers, superintendents, watchpersons and all other
employees of the Project, (vii) charges under any third party maintenance and
service contracts
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and charges for window cleaning, building and grounds maintenance and parking
lot maintenance, (viii) management fees (not to exceed 4% of the total Rent
payable by all tenants of the Project with respect to such calendar year), (ix)
costs of permits and licenses, (x) all replacement, maintenance and repair
expenses and supplies (including replacement of fluorescent light bulbs and
ballasts in light fixtures), (xi) costs of all utilities to the Project,
including, but not limited to, water, electricity, gas, air conditioning,
heating and lighting, (xii) legal and accounting costs, (xiii) amortization,
depreciation, interest expense and other debt costs with respect to equipment,
systems, installations, alterations or other capital expenditures, which are
made, installed or implemented for the primary purpose of (a) saving labor or
energy in the maintenance or operation of the Project, or (b) complying with any
applicable laws, statutes, regulations or other governmental or quasi-
governmental requirements or directives (such items shall be amortized [with
interest at 10% per annum on the unamortized balance thereof] over the
reasonable life of such capital improvement, with the reasonable life and
amortization schedule to be determined by Landlord in accordance with generally
acceptable accounting principles, but in no event to extend beyond the
reasonable life of the Building and/or the Project), and (xiv) all such other
usual and customary costs and expenses of any kind or nature, whether or not
mentioned in this Lease, deemed by Landlord necessary or desirable in connection
with the management, operation, repair and maintenance of the Project. Operating
Expenses shall be determined on an accrual basis. The Base Operating Expense for
the Project is set forth in Section 1.11 hereof. The "Estimated Operating
Expense Increase" shall equal the positive difference between the Landlord's
estimate of Operating Expenses for the applicable calendar year less the Base
Operating Expense. Landlord's statement of the Estimated Operating Expense
Increase shall control for the year specified in such statement and for each
succeeding year during the Term until Landlord provides a new statement of the
Estimated Operating Expense Increase. The "Actual Operating Expense Increase"
shall equal the positive difference of the actual Operating Expenses for the
applicable calendar year less the Base Operating Expense. Tenant may be billed
for Tenant's Pro Rata Share of the Estimated Operating Expense Increase after
the expiration or termination of this Lease or termination of Tenant's right to
possession of the Premises, and Tenant's obligation to pay such sums shall
survive the expiration or termination of this Lease or termination of Tenant's
right to possession of the Premises. Notwithstanding any provision contained
herein to the contrary, if less than ninety-five percent (95%) of the total
square feet of net rentable area of the Building is fully occupied by tenant(s)
during the 1997 calendar year or Landlord is not supplying services to at least
ninety-five percent (95%) of the total square feet of net rentable area of the
Building at any time during the 1997 calendar year, Operating Expenses for such
calendar year shall be determined to be an amount equal to the expense that
would normally be expected to be incurred had such occupancy been ninety-five
percent (95%) of the total square feet of net rentable area of the Building
during such year and had Landlord been supplying services to ninety-five percent
(95%) of the total square feet of net rentable area of the Building during such
calendar year. Not withstanding anything contained herein to the contrary,
Tenant's Pro Rata Share of the Estimated Operating Expense Increase (exclusive
of any increase in Operating Expenses attributable to items described in items
(i), (iv) and (xi) of this Section 3.03) shall in no event increase by more than
eight percent (8%) with respect to any calendar year throughout the term.
3.04 Service Charges. It is understood that the Rent and Tenant's Pro
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Rata Share of the Estimated Operating Expense Increase is payable on or before
the first day of each month, without offset or deduction of any nature. In the
event such rentals are not received when due or any check is tendered to
Landlord is returned to Landlord as uncollectible Tenant shall pay the
applicable service charges set forth in Section 1.20 hereof, which Landlord and
Tenant agree as a fair and reasonable estimate of the costs to be incurred by
Landlord by reason of such late payment. In no event shall the aggregate of the
interest to be paid by Tenant, plus any other amounts paid in connection with
the transaction evidenced hereby which would under applicable law be deemed
"interest", ever exceed the maximum amount of interest which, under applicable
law, could be lawfully charged to Tenant hereunder. Landlord and Tenant
specifically intend and agree to limit contractually the interest payable
hereunder to not more than the amount determined at the maximum lawful
nonusurious rate of interest (if any) which under applicable law is permitted to
be charged from time to time (the "Maximum Rate"). Therefore, none of the terms
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of this Lease shall ever be construed to create a contract to pay interest at a
rate in excess of the Maximum Rate, and Tenant shall not be liable for interest
in excess of that determined at the Maximum Rate, and the provisions of this
Section shall control all other provisions of this Lease. If any amount of
interest taken or received by Landlord shall be in excess of the maximum amount
of interest which, under applicable law, could lawfully have been collected
under this Lease, then the excess shall be deemed to have been the result of a
mathematical error by Landlord and Tenant and shall be refunded promptly to
Tenant. If Tenant fails in two (2) consecutive months to make rental payments
within ten (10) days after due, Landlord in order to reduce its administrative
costs, may require, by giving notice to Lessee (and in addition to any service
charges accruing pursuant to Section 1.20 hereof, as well as any other rights
and remedies accruing pursuant to Section 13.02 hereof, or any other term
provision or covenant of this Lease or available to Landlord at law or equity),
that Base Rent be payable quarterly in advance instead of monthly and that all
future rental payments are to be made on or before the due date by certified or
cashier's check or money order, and that the delivery of Tenant's personal or
corporate check will no longer constitute the payment of rental as provided in
this Lease. Any acceptance of a monthly rental payment or of a personal or
corporate check thereafter by Landlord shall not be construed as a subsequent
waiver of said rights.
3.05 Security Deposit. (a) To the extent required in Section 1.12
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hereof, Tenant shall deposit the Security Deposit with Landlord on the date
Tenant executes this Lease on the understanding: (a) that the Security Deposit
or any portion thereof may be applied to the curing of any default, without
prejudice to any other remedy or remedies which the Landlord may have on account
thereof, and upon such application Tenant shall pay Landlord on demand the
amount so applied which shall be added to the Security Deposit so the same will
be restored to its original amount; (b) that Landlord shall hold the Security
Deposit in a separate, interest-bearing account, with all interest being a part
of the Security Deposit; and (c) that if Tenant is not in default, the remaining
balance of the Security Deposit shall be returned to Tenant, including interest,
within thirty (30) days after the expiration of the Term provided, however,
Landlord shall have the right to retain and expend such remaining balance for
cleaning and repairing the Premises if Tenant shall fail to deliver the Premises
at the termination of this Lease in a neat and clean condition and in as good a
condition as existed at the date of possession of same by Tenant, except for
ordinary wear and tear.
(b) Within forty-five (45) days after each calendar quarter during the
Term of this Lease, Tenant shall deliver to Landlord a statement of the current
financial condition of Tenant (hereinafter referred to individually as a
"Financial Statement" collectively as the "Financial Statements") dated as of
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the last day of such immediately preceding calendar quarter, which Financial
Statements shall be certified by an independent certified public accountant to
be true and correct. If, at any time after the second (2nd) anniversary of the
Commencement Date, the most recent Financial Statement of Tenant reflects that
the shareholders' equity of Tenant is less than Two Million Dollars
($2,000,000.00) then Tenant shall, until such time as the most recent Financial
Statement of Tenant reflects that Tenant's shareholders' equity is at least
$2,000,000.00, increase the Security Deposit by $5,277.85 per month by paying
such additional monthly sum to Landlord concurrent with the payment of each
monthly installment of Base Rent.
3.06 Tenant Improvements Fee. In consideration of and as compensation
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for Landlord's construction of the Tenant Improvements (as such term is defined
in the Work Letter attached hereto as Exhibit E), Tenant shall pay to Landlord,
upon the complete execution of this Lease, as cash fee (the "Construction Fee")
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in the amount of Two Hundred Seventy-Three Thousand Dollars $273,000.00). Except
in the event that Tenant terminates this Lease pursuant to Section 1.07, Section
11.01 or Exhibit C hereof, the Construction Fee shall be non-refundable to
Tenant in all events.
ARTICLE 4
4.01 Use. Tenant shall use and occupy the Premises only for the
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purposes set forth in Section 1.14 hereof and for no other purposes. Tenant
shall not do or permit anything to be done in or about the Premises nor bring or
keep anything therein that will in any way increase the existing rate of or
affect any fire or other insurance upon the Project or any of its contents, or
cause cancellation of any insurance policy covering the Project or any part
thereof or any of its contents. Tenant shall not do or permit anything to be
done in or about the Premises that will in any way obstruct or interfere with
the rights of other tenants or occupants of the Project or injure or annoy them
or create unreasonable elevator loads or otherwise interfere with standard
Building operations. Tenant shall not permit any nuisance in, on or about the
Premises. Tenant shall not commit or suffer to be committed any waste in or upon
the Premises. Tenant shall comply (and shall operate the Premises and its
business thereon in a manner which causes the Premises to comply), at its sole
cost and expense, with Landlord's Rules and Regulations attached hereto as
Exhibit B, and with all laws, rules, orders, ordinances, directions, regulations
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and requirements of any federal, state, county, municipal, governmental or quasi
governmental authority affecting the Project now in force or that may hereafter
be enacted or promulgated.
4.02 Hazardous Substances, Tenant shall not cause or permit any
--------------------
Hazardous Substance to be used, stored, generated, or disposed of on or in the
Project by Tenant, Tenant's agents, employees, contractors, or invitees without
first obtaining Landlord's written consent. If Hazardous Substances are used,
stored, generated or disposed of on or in the Project except as permitted above,
or if the Project becomes contaminated in any manner for which Tenant is legally
liable, Tenant shall indemnify, defend and hold Landlord harmless from any and
all claims, damages, fires, judgments, penalties, costs, liabilities, or losses
(including, without limitation, a decrease in value of the Project, damages
caused by loss or restriction of rentable or usable space, or any damages caused
by adverse impact on marketing of the space, and any and all sums paid for
settlement of claims, attorneys' fees, consultant and expert fees) arising
during or after the Term and arising as a result of that contamination by
Tenant. This
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indemnification includes, without limitation, any and all costs incurred because
of any investigation of the site or any cleanup, removal, or restoration
mandated by a federal, state, or local agency or political subdivision. Without
limitation of the foregoing, if Tenant causes or permits the presence of any
Hazardous Substance on the Project and that results in contamination, Tenant
shall promptly, at its sole expense, take any and all necessary actions to
return the Project to the condition existing prior to the presence of any such
Hazardous Substance on the Project. Tenant shall first obtain Landlord's
approval for any such remedial action.
As used herein, "Hazardous Substance" means any substance that is
toxic, ignitable, reactive, or corrosive and that is regulated by any local
government, the state of Texas, or the United States Government. "Hazardous
Substance" include any and all material or substances that are defined as
"hazardous waste," "extremely hazardous waste," or a "hazardous substance"
pursuant to state, federal, or local government law. "Hazardous Substance"
includes but is not restricted to asbestos, polychlorobiphenyls ("PCBs"), and
----
petroleum.
ARTICLE 5
5.01 Landlord's Services. Provided Tenant is not in default hereunder,
-------------------
Landlord shall, at Landlord's expense, except as provided to the contrary in
this Lease, furnish to Tenant while Tenant is occupying the Premises, the
following services:
(a) Subject to curtailment as required by governmental laws, rules or
regulations, air conditioning and central heat, in season, at such
temperatures and in such amounts reasonably deemed by Landlord to be
standard for buildings of similar size, location and quality during normal
Building hours, which are to be 7:00 a.m. through 7:00 p.m. on weekdays
(excluding state and federal holidays) and 8:00 a.m. through 1:00 p.m. on
Saturdays.
(b) Janitorial services in the Premises and public portions of the Building
for all days except Saturdays, Sundays, and normal business holidays.
(c) Cold water at those points of supply provided for drinking,
toilet, and lavatory purposes.
(d) Normal and customary routine maintenance for all public,
structural, and exterior portions of the Project.
(e) Electric lighting service for all public portions of the Project.
(f) Non-exclusive automatic passenger elevator service at all times for
access to and egress from the Premises. Freight elevator service, in common
with other tenants, shall be provided during reasonable business hours as
prescribed by Landlord, exclusive of Saturdays, Sundays, and normal
business holidays.
(g) Electric energy that Tenant shall require for normal office equipment
such as typewriters, dictation machines, calculators, copiers, word
processing equipment, personal computers, other machines of a similar low
electrical consumption, and Building Standard Lighting in the Premises.
(h) Replacement of fluorescent light bulbs in any fluorescent light
fixtures which are located in the Premises and which contain the Building
standard light fixture.
(i) Landlord shall maintain the Project in substantially the same manner as
buildings of similar size, location and quality are being maintained.
5.02 Additional Service Cost. Air conditioning, heating and electricity
-----------------------
in excess of the quantities described above shall be provided to Tenant after
Tenant delivers a written request therefor within the time period prescribed
from time to time by Landlord. Tenant shall pay Landlord, upon demand, monthly
as billed charges for providing off-hour and nonstandard air conditioning,
heating and electricity; provided, however, that Tenant's excessive use or
consumption of heating, air conditioning and/or electrical services in violation
of Section 5.01 hereof, without Landlord's prior written consent, shall
constitute a default under this Lease. Tenant shall notify Landlord if Tenant
has installed or intends to install any equipment in the Premises which shall
consume heating, air conditioning or electrical services in excess of the
quantities described in Section 5.01 hereof, whereupon Landlord shall have the
right, at Tenant's expense, to install a separate meter to record Tenant's use
or consumption of such services.
5.03 Service Interruption. To the extent any of the services described
--------------------
above require electricity, gas, water or other services supplied by public
utilities, Landlord's covenants hereunder shall impose on Landlord only the
obligation to use its good faith efforts to cause the applicable public
utilities to furnish the same. Any failure or defect in the services described
above shall not be construed as an eviction of Tenant nor entitle Tenant to any
reduction, abatement, offset, or refund of Rent or to any damages from Landlord.
Landlord shall not be in breach or default under this Lease, provided Landlord
uses reasonable diligence during normal business hours to restore any such
failure or defect after Landlord receives written notice thereof. Not
withstanding the foregoing, if (i) any portion of the Premises is rendered
untenantable for a period of ten (10) consecutive business days due to a failure
or defect in utility services including HVAC that is not the result of a
negligent or wrongful act or omission of Tenant, then Tenant shall, with respect
to such portion of the Premises that is so rendered untenantable, be entitled to
an abatement of Rent payable hereunder for the period beginning on the day that
such portion of the Premises is rendered untenantable until such utility
services are restored.
ARTICLE 6
6.01 Alterations. Tenant shall not make or allow to be made any
-----------
alterations, installations, additions or improvements in or to the Premises, or
place safes, vaults or other heavy furniture or equipment within the Premises,
without Landlord's prior written consent. All alterations, installations,
additions or improvements, other than movable furniture and movable trade
fixtures, made by Tenant to the Premises shall remain upon and be surrendered
with the Premises and become the property of Landlord at the expiration or
termination of this Lease or the termination of Tenant's right to possession of
the Premises; provided, however, that Landlord may require Tenant, at Tenant's
cost, to remove any or all of such items that are not Building standard upon the
expiration or termination of this Lease or termination of Tenant's right to
possession of the Premises. Tenant, at its sole cost and prior to the expiration
or termination of this Lease, shall remove all of Tenant's property from the
Premises. All work shall be completed promptly and in a good and workmanlike
manner and shall be performed in such a manner that no mechanic's, materialman's
or other similar liens shall attach to Tenant's leasehold estate, and in no
event shall Tenant permit, or be authorized to permit, any such liens or other
claims to be asserted against Landlord or Landlord's rights, estate and
interests with respect to the Project or this Lease.
6.02 Tenant Repairs. By taking possession of the Premises, Tenant shall
--------------
be deemed to have accepted the Premises as being in good, sanitary order,
condition and repair and suitable for the conduct of Tenant's business (except
for latent defects).. Tenant shall, at Tenant's sole cost and expense, keep the
Premises in good condition and repair. Any injury or damage to the Premises or
Project or the appurtenances or fixtures thereof, caused by or resulting from
the act, omission or neglect of Tenant or Tenant's employees, servants, agents,
invitees, assignees, or subtenants shall be repaired or replaced by Tenant, or
at Landlord's option by Landlord, at the expense of Tenant. If Tenant fails to
maintain the Premises or fails to repair or replace any damage to the Premises
or Project resulting from the negligence or intentional act of Tenant, its
employees, servants, agents, invitees, assignees or subtenants, Landlord may,
but shall not be obligated to, cause such maintenance, repair or replacement to
be done, as Landlord deems necessary, and Tenant shall immediately pay to
Landlord all costs related thereto plus a reasonable charge for overhead.
Landlord's approval of any plans, specifications or working drawings for
Tenant's alterations shall not impose or create any responsibility or liability
on Landlord for their completeness, design sufficiency or compliance with all
applicable laws, rules and regulations of governmental agencies or authorities.
6.03 Landlord Repairs. Unless otherwise stipulated herein, Landlord
----------------
shall not be required to make any improvements to or repairs of any kind or
character to the Premises during the Term of this Lease. Notwithstanding any
provisions of this Lease to the contrary, all repairs, alterations or additions
to the base Building or its systems (as opposed to those involving only Tenant's
leasehold improvements), and all repairs, alterations or additions to Tenant's
leasehold improvements which affect the Building's structural components or
major mechanical, electrical or
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plumbing systems, made for or on behalf of Tenant and any other Tenants in the
Building shall be made by Landlord or its contractor only, and, if for or on
behalf of Tenant, shall be paid for by Tenant in an amount equal to Landlord's
costs plus a reasonable charge for overhead.
6.04 Signage. With the prior written approval of Landlord as to
-------
quantity, design, size, character and location, Tenant may, at Tenant's sole
cost and expense, erect certain signs identifying Tenant as a tenant of the
Building on the door to the Premises and on the exterior of the Building above
the balcony on level four (4) of the Building. All such signage shall comply in
all respects with all applicable laws, rules and regulations. Tenant shall not
erect or install any sign or other type display whatsoever upon the exterior of
the Building, upon or in any window, or in any lobby, hallway or door therein
located, without the express written consent of Landlord. All signs or lettering
shall conform to the sign and lettering criteria established by Landlord.
ARTICLE 7
7.01 Landlord Insurance. Landlord shall insure the Project and shall
------------------
maintain liability and property insurance in commercially reasonable amounts.
The cost of such insurance shall be an "Operating Expense" as defined in Section
3.03 hereof. Such insurance shall be for the sole benefit of Landlord and, if
required, Landlord's mortgagee. If the annual premiums to be paid by Landlord
exceed the standard rates because of Tenant's operations within or contents of
the Premises or because improvements to the Premises are beyond Building
Standard, Tenant shall promptly pay the excess amount of the premium upon
request by Landlord (and if necessary, Landlord may allocate the insurance costs
of the Building to give effect to this sentence).
7.02 Tenant Insurance. Tenant shall, at all times during the Term, at its
----------------
sole cost and expense, obtain and continue to keep in force the following
insurance in the amounts required in Section 1.21 hereof:
(a) Fire insurance, including extended coverage, vandalism, and malicious
mischief, upon property of every description and kind owned by Tenant and
located in the Project or for which Tenant is legally liable or which is
installed by or on behalf of Tenant including, without limitation,
furniture, fittings, installations, fixtures and any other personal
property, leasehold improvements and alterations.
(b) Comprehensive General Liability Insurance coverage to include personal
injury, bodily injury, broad form property damage, operations hazard,
owner's protective coverage and contractual liability.
(c) Workers Compensation and Employer's Liability insurance.
(d) Any other form or forms of insurance as Tenant may reasonably require
from time to time in form, in amounts and for insurance risks against which
a prudent Tenant of a comparable size and in a comparable business would
protect itself.
All policies shall be taken out with insurers that are reasonably acceptable to
Landlord and in form reasonably satisfactory from time to time to Landlord.
Tenant agrees that certificates of insurance in form acceptable to Landlord will
be delivered to Landlord as soon as practicable after the placing of the
required insurance, but not later than ten (10) days prior to Tenant's occupancy
of all or any part of the Premises. All policies shall contain an undertaking by
the insurers to notify Landlord (and, if specifically requested by Landlord, the
mortgagees of Landlord) in writing not less than thirty (30) days before any
material change, reduction in coverage, cancellation, or other termination
thereof. If Tenant fails to procure and maintain said insurance, Landlord may,
but shall not be obligated to, procure and maintain same, but at the expense of
Tenant. Landlord makes no representation or warranty that the insurance carried
by Tenant pursuant to the terms hereof shall be adequate or sufficient for any
particular purpose.
7.03 Waiver of Subrogation. Whenever (a) any loss, cost, damage or
---------------------
expense resulting from fire, explosion or any other casualty or occurrence is
incurred by either of the parties to this Lease in connection with the Premises
or the Project, and (b) such party is then covered (or is required under this
Lease to be covered) in whole or in part by insurance with respect to such loss,
cost, damage or expense, then the party so insured hereby releases the other
party from any liability it may have on account of such loss, cost, damage or
expense to the extent of any amount recovered by reason of such insurance, and
waives any right of subrogation which might otherwise exist on account thereof,
provided that such release of liability and waiver of the right to subrogation
shall not be operative in any case where the effect thereof is to invalidate
such insurance coverage or increase the cost thereof (provided, that in the case
of increased cost, the other party shall have the right, within thirty (30) days
following written notice, to pay such increased costs, thereupon keeping such
release and waiver in full force and effect). Landlord and Tenant shall use
their respective best efforts to obtain such a release and waiver of subrogation
from their respective insurance carriers and shall obtain any special
endorsements, if required by their insurer, to evidence compliance with the
aforementioned waiver. The failure by Tenant to carry property insurance
required to be carried by Tenant hereunder shall be a defense against any claim
by Tenant against Landlord for property damage caused by Tenant.
7.04 Indemnity. Tenant hereby indemnifies and holds Landlord harmless
---------
from and against any and all claims arising from Tenant's use of the Premises,
for the conduct of its business or from any activity, work or other thing done,
permitted or suffered by Tenant on or about the Project and shall further
indemnify and hold harmless Landlord from and against any and all claims arising
from any breach or default in the performance of any obligation on Tenant's part
to be performed under the terms of this Lease, or arising from any act or
omission of, or due to the negligence of, the Tenant, or any officer, agent,
employee, guest or invitee of Tenant, and from and against all costs, attorney's
fees, expenses and liabilities incurred in or related to any such claim or any
action or proceeding brought thereon. Landlord shall indemnify and hold Tenant
harmless from and against any and all claims arising out of (i) breach or
default by Landlord with respect to any of its obligations under this Lease,
(ii) negligent act of Landlord or any of its agents, employees, contractors or
officers within the Premises, and (iii) Landlord's gross negligence or willful
misconduct.
ARTICLE 8
8.01 Casualty. If the Premises or Project, or any portion of either,
--------
shall be damaged by fire or other casualty covered by the insurance carried by
Landlord hereunder and the cost of repairing such damage shall not be greater
than ten percent (10%) of the then full replacement cost thereof, then, subject
to the following provisions of this Article, Landlord shall repair the Premises
and/or Project. If the Premises or Project shall be damaged (a) by fire or other
casualty not covered by insurance carried by Landlord hereunder, (b) by fire or
other casualty covered by insurance carried by Landlord hereunder and Landlord's
mortgagee requires that such insurance proceeds be used to retire the mortgage
debt, (c) to an extent greater than ten percent (10%) of the then full
replacement cost thereof, or (d) during the last twelve (12) months of the Term
or any renewal term hereof, then Landlord shall have the option (i) to repair or
reconstruct the portion of the damaged Premises or Project covered by Landlord's
insurance, or (ii) to terminate this Lease by so notifying Tenant within sixty
(60) days after the date of such fire or other casualty, such termination to be
effective as of the date of such fire or other casualty. The Rent required to be
paid hereunder shall be abated in proportion to the portion of the Premises, if
any, which is rendered untenantable by fire or other casualty hereunder until
repairs of the Premises are completed, or if the Premises are not repaired,
until the Expiration Date hereunder. Other than such rental abatement, no
damages, compensation or claims shall be payable by Landlord for loss of the use
of the whole or any part of the Premises, Tenant's personal property, or any
inconvenience, loss of business or profit, or annoyance arising from any such
repair and reconstruction. If the damage results from the fault or negligence of
Tenant, its agents, employees, licensees or invitees, Tenant shall not be
entitled to any abatement or reduction of any Rent or other sums due hereunder,
and such damage shall be repaired by Tenant, or at Landlord's option by
Landlord, at Tenant's expense. If this Lease is terminated as provided in (ii)
above, all Rent shall be apportioned and paid up to the date of such
termination. Landlord shall not be required to repair or replace any furniture,
furnishings, or other personal property that Tenant may be entitled to remove
from the Premises or any property constructed and installed by or for Tenant
pursuant to Section 6.01 hereof or any installations in excess of Building
Standard.
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ARTICLE 9
9.01 Condemnation. If more than twenty percent (20%) of the Premises
------------
should be taken for any public or quasi-public use, by right of eminent domain
or otherwise, or should be sold in lieu of condemnation, then either party
hereof shall have the right, at its option, to terminate this Lease as of the
date when physical possession of the Premises is taken by the condemning
authority. If twenty percent (20%) or less of the Premises is so taken or sold
or if this Lease is not terminated upon any taking or sale of greater than
twenty percent (20%) of the Premises, the Rent payable hereunder shall be abated
in proportion to the portion of the Premises which is rendered untenantable by
such condemnation, and Landlord shall, to the extent Landlord deems feasible,
restore the Premises to substantially its former condition, but Landlord shall
not in any event be required to spend for such work an amount in excess of the
amount received by Landlord as compensation for such taking. If any part of the
Project other than the Premises may be so taken or sold, Landlord shall have the
right at its option to terminate this Lease as of the date when physical
possession of such part of the Project is taken by the condemning authority. All
amounts awarded upon taking of any part or all of the Project or the Premises
shall belong to Landlord and Tenant shall not be entitled to, and expressly
assigns all claims, rights and interests to, any such compensation to Landlord.
ARTICLE 10
10.01 Entry. Landlord, its agents, employees and representatives, shall
-----
have the right to enter the Premises at any time upon reasonable notice to
Tenant under the circumstances (which notice may be oral and not in compliance
with Section 15.08 hereof, but no notice shall be required in the case of
routine maintenance or an emergency) to show the Premises to prospective Tenants
or purchasers or for any purpose that Landlord may reasonably deem necessary for
the operation and maintenance of the Project. For each of the aforesaid
purposes, Landlord shall at all times have and retain a key with which to unlock
all of the doors in, upon and about the Premises, excluding Tenant's vaults,
safes and files. Landlord shall have the right to use any and all means which
Landlord may deem proper to open the doors in, upon and about the Premises in an
emergency in order to obtain entry to the Premises without liability to Tenant,
except for any failure to exercise due care for Tenant's property.
ARTICLE 11
11.01 Subordination. Tenant accepts this Lease subject and subordinate
-------------
to any mortgage, deed of trust or other lien presently existing or hereafter
placed upon the Premises or the real property upon which the Premises are
located, and to any renewals and extensions thereof; provided, however, within
one hundred twenty (120) days after the effective date of this Lease, Landlord
shall obtain and deliver to Tenant the written agreement (the "Non-Disturbance
---------------
Agreement") of the existing mortgagee of the Project (on the form issued by such
---------
mortgagee) stating that Tenant's occupancy of the Premises and its rights
hereunder shall not be disturbed so long as Tenant is not in default hereunder;
further provided, however, that any such mortgagee shall have the right at any
time to subordinate such mortgage, deed of trust or other lien to this Lease.
Notwithstanding that this Lease may be (or made to be) superior to such
mortgage, deed of trust or other lien, the provisions of such mortgage, deed of
trust or other lien relative to the rights of the mortgagee with respect to
proceeds arising from an eminent domain taking (including a voluntary conveyance
by Landlord) and/or arising from insurance payable by reason of damage to or
destruction of the Premises shall be prior and superior to any contrary
provisions contained herein with respect to the payment or usage thereof. Tenant
agrees upon demand to execute such further instruments subordinating this Lease
as Landlord may request, provided such subordination agreements shall expressly
provide that Tenants occupancy of the Premises and its rights hereunder shall
not be disturbed so long as Tenant performs all of its covenants and obligations
hereunder. In the event that the Non-Disturbance Agreement is not delivered to
Tenant within one hundred twenty (120) days after the effective date of this
Lease, Tenant may terminate this Lease by written notice to Landlord, in which
event the Construction Fee shall be refunded to Tenant.
11.02 Attornment. If any ground or similar such lease, mortgage, deed
----------
of trust or security agreement is enforced by the ground lessor, the mortgagee,
the trustee, or the secured party, Tenant shall, upon request, attorn to the
Lessor under such lease or the mortgagee or purchaser at such foreclosure sale,
or any person or party succeeding to the interest of Landlord as a result of
such enforcement, as the case may be, and execute instrument(s) confirming such
attornment. In the event of such enforcement and upon Tenant's attornment as
aforesaid, Tenant will automatically become the tenant of the successor to
Landlord's interest without change in the terms or provisions of this Lease;
provided, however, that such successor to Landlord's interest shall not be bound
by (a) any payment of Rent for more than one month in advance (except
prepayments for security deposits, if any), or (b) any amendments or
modifications of this Lease made without the prior written consent of such
Lessor or mortgagee.
11.03 Quiet Enjoyment. Tenant, on paying the Rent and keeping and
---------------
performing the conditions and covenants herein contained, shall and may
peaceably and quietly enjoy the Premises for the Term, subject to the aforesaid
underlying leases, mortgages, deeds of trust and security agreements, all
applicable laws and other governmental and legal requirements, applicable
insurance requirements and regulations, and the provisions of this Lease. It is
understood and agreed that this covenant and any and all other covenants of
Landlord contained in this Lease shall be binding upon Landlord and its
successors only with respect to breaches occurring during its and their
respective ownership of the Landlord's interest hereunder.
ARTICLE 12
12.01 Assignment and Subletting. Tenant shall not, voluntarily, by
-------------------------
operation of law, or otherwise, assign, transfer, mortgage, pledge, or encumber
this Lease or sublease the Premises or any part thereof, or suffer any person
other than Tenant, its employees, agents, servants and invitees to occupy or use
the Premises or any portion thereof, without the express prior written consent
of Landlord. Any attempt to do any of the foregoing without such written consent
shall be null and void and of no effect, and shall further constitute a Default
under this Lease. Notwithstanding the foregoing, Landlord shall not unreasonably
withhold its consent to a proposed assignment or sublease so long as (i) the
proposed assignee or sublessee satisfies Landlords customary financial
requirements for prospective tenants of the Building and (ii) the proposed use
of such tenant or sublessee would not, in Landlord's reasonable judgment, be
detrimental to the Building or other tenants therein. If Tenant so requests
Landlord's consent, said request shall be in writing specifying the duration of
said desired sublease or assignment, the date same is to occur, the exact
location of the space affected thereby and the proposed rentals on a square foot
basis chargeable thereunder, and shall be submitted to Landlord at least fifteen
(15) days in advance of the date on which Tenant desires to make such assignment
or sublease or allow such occupancy or use. Upon such request Landlord may,
based on the standards described above, either (a) grant such consent subject to
Landlord's approval of the assignee, transferee, subtenant, or mortgagee, or
(b)not grant such consent. In no event may Tenant assign this Lease or sublease
the Premises or any portion thereof to any party whose operations in the Project
would not be in keeping with, or would detract from, the operations of other
tenants in the Project or whose use of the Premises would be inconsistent with
the use described in Section 1.14 hereof. Tenant shall promptly reimburse
Landlord for all reasonable expenses incurred by Landlord in connection with any
such proposed assignment or sublease, whether or not Landlord consents to such
action.
12.02 Continued Liability. Except as provided hereinafter, Tenant
-------------------
shall, despite any permitted assignment or sublease, remain directly and
primarily liable for the performance of all of the covenants, duties, and
obligations of Tenant hereunder, and Landlord shall be permitted to enforce the
provisions of this Lease against Tenant or any assignee or sublessee without
demand upon or proceeding in any way against any other person.
12.03 Consent. Consent by Landlord to a particular assignment or
-------
sublease shall not be deemed a consent to any other or subsequent transaction.
If this Lease is assigned or if the Premises are subleased without the
permission of Landlord, then Landlord may nevertheless collect Rent from the
assignee or sublessee and apply the rent amount collected to the Rent payable
hereunder, but no such transaction or collection of Rent or application thereof
by Landlord shall be deemed a waiver of any provision hereof or a release of
Tenant from the performance of the obligations of the Tenant hereunder.
12.04 Proceeds. To the extent monthly cash or other proceeds of any
--------
assignment, sale or sublease of Tenant's interest in this Lease, whether
consented to by Landlord or not, exceed the monthly Rent called for hereunder
(the "Excess Proceeds"), the first $5,277.85 of such monthly Excess Proceeds
shall be paid to Tenant, and any additional Excess Proceeds over and above such
amount shall be shared equally by Tenant and Landlord.
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ARTICLE 13
13.01 Default. Each of the following shall constitute a default by Tenant
-------
(hereinafter referred to as a "Default"):
-------
(a) The failure of Tenant to pay when due the Rent or any part thereof or
any other sum of money payable hereunder, and the continuance of such
failure for a period of ten (10) days after written notice thereof has been
given by Landlord to Tenant; provided, however, Landlord shall not be
required to give such written notice, and Tenant shall not be entitled to
same more than two (2) times during any calendar year, and any such
subsequent failure shall be a Default upon the occurrence thereof without
any notice whatsoever to Tenant;
(b) Tenant or any Guarantor takes any action to, or notifies Landlord that
Tenant or Guarantor intends to, file a petition under any section or
chapter of the United States Bankruptcy Code, as amended from time to time,
or under any similar law or statute of the United States or any state
thereof; or a petition shall be filed against Tenant under any such statute
or Tenant or any Guarantor notifies Landlord that it knows such a petition
will be filed; or the appointment of a receiver or trustee to take
possession of substantially all of Tenant's assets located at the Premises
or of Tenant's interest in this Lease; or the attachment, execution or
other judicial seizure of substantially all of Tenant's assets located at
the Premises or of Tenant's interest in this Lease;
(c) The failure of Tenant to fulfill or perform, in whole or in part, any
of its obligations under this Lease (other than the payment of Rent) and
such failure or nonperformance shall continue for a period of thirty (30)
days after written notice thereof has been given by Landlord to Tenant;
provided, however, Landlord shall not be required to give such thirty (30)
day notice with respect to any particular failure or default by Tenant, and
Tenant shall not be entitled to same, more than two (2) times during any
calendar year, and any such subsequent failure by Tenant to perform such
obligation shall be a Default upon the occurrence thereof without any
notice whatsoever to Tenant;
(d) Tenant shall have assigned or sublet the Premises without the prior
written consent of Landlord; or
(e) Tenant shall fail to move into or take possession of the Premises
within fifteen (15) days after the Commencement Date (except as otherwise
provided in Section 1.07 hereof).
13.02 Rights upon Default.
-------------------
(a) If a Default by Tenant shall have occurred, Landlord shall have the
right, at its election, then or at any time thereafter to pursue any one
(1) or more of the following remedies without any demand or notice
whatsoever, in addition to all other rights or remedies provided herein or
at law or in equity, it being understood that all of such remedies shall be
cumulative:
(i) Landlord may elect to terminate this Lease and Tenant's right to
the Premises or, without terminating this Lease, forthwith
terminate Tenant's right to possession of the Premises. Upon any
termination of this Lease, whether by lapse of time or
otherwise, or upon any termination of Tenant's right to
possession without termination of this Lease, Lessee shall
surrender possession and vacate the Premises and deliver
possession thereof to Landlord, and Tenant hereby grants to
Landlord full and free license to enter into and upon the
Premises with or without process of law in the event of any such
termination of lease or right to possession, and to repossess
Landlord of the Premises as of Landlord's former estate and to
expel or remove Tenant and any others who may be occupying or be
within the Premises or any part thereof and to remove any and
all property therefrom using such force as may be necessary
without being deemed in any manner guilty of trespass, eviction
or forcible entry or detainer, without being liable for
prosecution or any claim for damages therefor hereunder without
relinquishing Landlord's rights to rent or any other right given
to Landlord hereunder or by operation of law.
(ii) If Tenant voluntarily abandons the Premises or otherwise
entitles Landlord to elect to terminate Tenant's right to
possession only without terminating this Lease, and Landlord
does so elect, Landlord may, at Landlord's option, enter into
the Premises, remove Tenant's signs and other evidences of
tenancy and take and hold possession thereof as described in
subparagraph (i) of this Section 13.02, without such entry and
possession terminating this Lease or releasing Tenant, in whole
or in part, from Tenant's obligation to pay the Rent hereunder
for the full Term. Upon and after entry into possession without
termination of this Lease, subject to Landlord's right to first
rent other vacant areas in the Building and/or the Project,
Landlord may elect to relet the Premises or any part thereof to
any person, firm or corporation other than Tenant for such rent,
for such time and upon such terms as Landlord in Landlord's sole
discretion shall deem advisable and receive the rent therefor.
Any proceeds from any such reletting of the Premises by Landlord
shall first be applied against the cost and expenses of
reletting the Premises including, but not limited to, all
brokerage, advertising, legal, alteration and other expenses
incurred to secure a new tenant for the Premises. If the
consideration collected by Landlord upon any such reletting,
after payment of the expenses of reletting the Premises, is not
sufficient to pay monthly the full amount of the rent reserved
in this Lease, Tenant shall pay to Landlord the amount of each
monthly deficiency as it becomes due upon demand. If the
consideration collected by Landlord upon any such reletting for
Tenant's account is, after payment of the expenses of reletting
the Premises, greater than the amount necessary to pay the full
amount of the rent reserved in this Lease, the full amount of
such excess shall be retained by Landlord and in no event
payable to Tenant.
(iii) Should Landlord decide to terminate this Lease, Landlord, at its
sole option, shall be entitled to recover from Tenant, in lieu
of any amounts due under subparagraph (ii) only of this Section
13.02, and Tenant shall pay to Landlord, on demand, as and for
liquidated and agreed final damages, a sum equal to the amount
of Landlord's reasonable estimate of the aggregate amount of
Rent for the period from the date of such termination through
the termination date set forth herein, increased annually for
CPI as set forth herein, and including but not limited to,
Actual Operating Expense Increase and other amounts payable as
rent hereunder, reduced by the then reasonable rental value of
the Premises discounted to present value at a rate equal to the
rate of interest which is allowable by law in the State of
Texas, when the parties to a contract have not agreed on any
particular rate of interest or, in the absence of such law, at
the rate of six percent (6%) per annum. If, before presentation
of proof of such liquidated damages to any court, commission or
tribunal, the Premises, or any part thereof, shall have been
relet by Landlord to an unrelated third party, for such period,
or any part thereof, the amount of rent payable upon such
reletting shall be deemed to be the reasonable rental value for
the part or the whole of the Premises relet during the term of
the reletting.
(iv) Landlord may enter upon the Premises by force if necessary,
without being liable for prosecution or any claim for damages
thereon, and do whatever Tenant is obligated to do under the
terms of this Lease; and Tenant agrees to reimburse Landlord on
demand for any expenses which Landlord may incur in thus
effecting compliance with Tenant's obligations under this Lease,
such amounts to constitute additional rent payable hereunder,
and Tenant further agrees that Landlord shall not be liable for
any damages resulting to Tenant from any such action.
(v) Notwithstanding anything in this Lease to the contrary, any and
all remedies set forth in this Lease (A) shall be in addition to
any and all other remedies Landlord may have at law or in equity
and (B) shall be cumulative. The waiver by Landlord of any
breach of any term, covenant or condition herein contained shall
not be deemed to be a waiver of such term, covenant or
condition. The acceptance of rent hereunder shall not be
construed to be a waiver of any breach by Tenant of any term,
covenant or condition of this Lease. The acceptance by Landlord
at any time
-7-
or from time to time of rent in an amount less than that to
which Landlord is entitled hereunder shall not be construed as a
waiver of Landlord's right to demand the full amount nor a
release of Tenant's liability for the full amount of rent
payable hereunder.
(vi) No re-entry or taking possession of the Premises by Landlord
shall be construed as an election on its part to terminate this
Lease, unless a written notice of such intention be given to
Tenant. Notwithstanding any such reletting or entry or taking
possession, Landlord may at any time thereafter elect to
terminate this Lease for a previous Default. Pursuit of any of
the foregoing remedies shall not preclude pursuit of any of the
other remedies herein provided or any other remedies provided by
law, nor shall pursuit of any remedy herein provided constitute
a forfeiture or waiver of any rent due to Lessor hereunder or of
any damages accruing to lessor by reason of the violation by
Tenant of any of the terms, provisions and covenants herein
contained. Landlord's acceptance of rent following Tenant's
Default hereunder shall not be construed as Landlord's waiver of
such Default. No waiver by Landlord of any failure, violation or
breach of any of the terms, provisions and covenants herein
contained shall be deemed or construed to constitute a waiver of
any other failure, violation or default. The loss or damage that
Landlord may suffer by reason of termination of this Lease or
the deficiency from any reletting as provided for above shall
include the expense of repossession and any repairs or
remodeling undertaken by Landlord following possession. Should
Landlord at any time terminate this Lease for any event of
default, in addition to any other remedy Landlord may have,
Landlord may recover from Tenant all damages Landlord may incur
by reason of such Default, including the cost of recovering the
Premises and the loss of rental for the remainder of the Term.
(b) Without limiting or waiving any rights of Landlord as set forth
in 13.02 (a) above, if there exists a Default under 13.01 above,
Landlord may, without judicial process, prevent Tenant from entering
the Premises by changing the door locks. If Landlord changes the door
locks, Landlord shall place a written notice, on the front door of the
Premises, stating the name and address or telephone number of an
individual or company from which a new key may be obtained by Tenant;
provided, however, that (i) the new key needs to be provided only
during tenant's regular business hours, and (ii) Landlord may
condition delivery of the new key upon Tenant's payment of all rent
then due. Costs and expenses incurred by Landlord in exercise of its
right pursuant to this subsection (b) shall be deemed to be damages
and/or costs recoverable by Landlord pursuant to 13.02 (a) above.
13.03 Costs. If a Default by Tenant occurs, then Tenant shall reimburse
-----
Landlord on dem and for all costs reasonably incurred by Landlord in connection
therewith including, but not limited to, reasonable attorney's fees and court
costs.
13.04 Non-Waiver. The failure of Landlord to seek redress for violation
----------
of, or to insist upon the strict performance of, any covenant or condition of
this Lease shall not prevent a subsequent act or omission that would have
originally constituted a violation of this Lease from having all the force and
effect of an original violation. The receipt by Landlord of Rent with or without
knowledge of the breach of any provision of this Lease shall not be deemed a
waiver of such breach, shall not reinstate this Lease or Tenant's right of
possession if either or both have been terminated, and shall not otherwise
affect any notice, election, action, or suit by Landlord. No provision of this
Lease shall be deemed to have been waived by Landlord unless such waiver is in
writing signed by Landlord. No act or thing done by Landlord during the Term
shall be deemed on acceptance of a surrender of the Premises and no agreement to
accept such surrender shall be valid, unless express and in writing signed by
Landlord.
ARTICLE 14
14.01 Organization and Power (Corporation). This Section is applicable
------------------------------------
if Tenant is a corporation. Tenant represents and warrants to Landlord that
Tenant (a) is a corporation duly organized, validly existing under the laws of
the state of its incorporation and in good standing under the laws of the state
of its incorporation and the laws of the State of Texas, (b) has paid all
franchise and other taxes, if any, required to maintain the corporate existence
of Tenant, and (c) is not the subject of voluntary or involuntary proceedings
for the forfeiture of the Certificate of Incorporation of Tenant for its
dissolution.
14.02 Organization and Power (Partnership or Joint Venture). This
-----------------------------------------------------
section is applicable if Tenant is a partnership or joint venture. Tenant is
duly organized and validly existing under applicable state laws, and this Lease
is within Tenant's powers, has been duly authorized by all requisite action and
is not in contravention of law or the powers of Tenant's partnership or joint
venture agreement, as the case may be.
ARTICLE 15
15.01 Amendment. Any agreement hereafter made between Landlord and
---------
Tenant shall be ineffective to modify, release, or otherwise affect this Lease,
in whole or in part, unless such agreement is in writing and signed by the party
to be bound thereby.
15.02 Severability. If any term or provision of this Lease shall, to any
------------
extent, be held invalid or unenforceable by a final judgment of a court of
competent jurisdiction, the remainder of this Lease shall not be affected
thereby.
15.03 Estoppel Letters. Tenant shall execute and acknowledge a
----------------
certificate containing such information as may be reasonably requested for the
benefit of Landlord, any prospective purchaser or any current or prospective
mortgagee of all or any portion of the Project within ten (10) days of receipt
of same (so long as such information is accurate). In the event Tenant fails to
deliver such certificate to Landlord, Tenant irrevocably appoints Landlord as
Tenant's attorney-in-fact to execute same. Furthermore, within fifteen (15) days
after Landlord's request, Tenant shall furnish to Landlord the most recent
audited financial statement of Tenant (including any notes thereto), or if no
such audited statements have been prepared, such other financial statements (and
notes thereto) as may have been prepared by an independent certified public
accountant or officer of Tenant. Landlord will not disclose any aspect of such
financial statements that Tenant designates to Landlord as confidential, except
(a) to Landlord's lender or prospective purchasers of the Project, (b) in
litigation between Landlord and Tenant, and (c) as may be required by court
order or other judicial process.
15.04 Landlord's Liability and Authority. All obligations of Landlord
----------------------------------
under this Lease are, and shall hereafter be deemed and construed as, covenants
(and not conditions to Tenant's performance hereunder). The liability of
Landlord to Tenant for any default by Landlord under the terms of this Lease
shall be limited to the interest of Landlord in the Project, it being intended
that Landlord, its officers, directors, partners, joint venturers, and/or
employees shall not be personally liable for any judgment or deficiency. It is
the intention of the parties hereto that the obligations of Tenant hereunder
shall be separate and independent covenants and agreements, that the Base Rent
and all other sums payable by Tenant hereunder shall continue to be payable in
all events and that the obligations of Tenant hereunder shall continue
unaffected, unless the requirement to pay or perform the same shall have been
abated, terminated or modified pursuant to an express provision of this Lease.
15.05 Holdover. If Tenant shall remain in possession of the Premises
--------
after the Expiration Date or earlier termination of this Lease, then Tenant
shall be deemed a tenant-at-will whose tenancy is terminable at any time. In
such event, Tenant shall pay Rent at one hundred fifty percent (150%) of the
greater of (a) the Rent or (b) the fair market rental rate for the Premises on
the date of such termination or expiration, but otherwise shall be subject to
all of the obligations of Tenant under this Lease. Additionally, Tenant shall
pay to Landlord all damages sustained by Landlord on account of such holding
over by Tenant.
15.06 Surrender. Upon the expiration or earlier termination of the
---------
Term, Tenant shall peaceably quit and surrender the Premises in good order and
condition, excepting ordinary wear and tear, but subject to Sections 6.01 and
6.02 hereof. All obligations of Tenant for the period of time prior to the
expiration or earlier termination of the Term shall survive such expiration or
termination.
15.07 Parties and Successors. Subject to the limitations and conditions
----------------------
set forth elsewhere herein, this Lease shall bind and inure to the benefit of
the respective heirs, legal representatives, successors, and permitted assigns
and/or sublessees of the parties hereto. The term "Landlord",
-8-
as used in this Lease, so far as the performance of any covenants or obligations
on the part of Landlord under this Lease are concerned, shall mean only the
owner of the Project at the time in question, so that in the event of any
transfer of title to the Project, the party by whom any such transfer is made
shall be relieved of all liability and obligations of the Landlord arising under
this Lease from and after the date of such transfer, so long as the new owner of
the Project assumes the obligations of Landlord under this Lease that arise from
and after the date of such transfer.
15.08 Notice. Except as otherwise provided herein, any statement,
------
notice, or other communication that Landlord or Tenant may desire or be required
to give to the other shall be deemed sufficiently given or rendered if hand
delivered, or if sent by registered or certified mail, return receipt requested,
addressed at the address(Es) set forth in Section 1.16 hereof, or at such other
address(es) as the other party shall designate from time to time by prior
written notice, and such notice shall be effective when the same is received or
mailed as herein provided. Manager shall be a co-addressee with Landlord on all
notices given to Landlord by Tenant hereunder.
15.09 Rules and Regulations. Tenant, its servants, employees, agents,
---------------------
visitors, invitees, and licensees, shall observe faithfully and comply strictly
with the Rules and Regulations set forth in Exhibit B attached hereto and made a
---------
part hereof for all purposes, and shall abide by and conform to such further
rules and regulations as Landlord may from time to time reasonably make, amend
or adopt, after Tenant receives a copy thereof.
15.10 Captions. The captions in this Lease are inserted only as a
--------
matter of convenience and for reference and they in no way define, limit, or
describe the scope of this Lease or the intent or any provision hereof.
15.11 Number and Gender. All genders used in this Lease shall include
-----------------
the other genders, the singular shall include the plural, and the plural shall
include the singular, whenever and as often as may be appropriate.
15.12 Governing Law. This Lease shall be governed by and construed in
-------------
accordance with the laws of the State of Texas.
15.13 Inability to Perform. Notwithstanding Section 15.17 hereof,
--------------------
whenever a period of time is herein prescribed for the taking of any action by
any party hereto (but excluding Tenant's obligations to pay any Rent when due
hereunder), such party shall not be liable or responsible for, and there shall
be excluded from the computation of such period of time, any delays due to
strikes, riots, acts of God, shortages of labor or materials, war, governmental
laws, regulations or restrictions, or any other cause whatsoever beyond the
control of such party, and such nonperformance or delay in performance by such
party shall not constitute a breach or default by such party under this Lease
nor give rise to any claim against such party for damages or constitute a total
or partial eviction, constructive or otherwise.
15.14 Broker. Tenant represents and warrants that Tenant has dealt
------
with, and only with Tenant's Broker named in Section 1.16 hereof as broker in
connection with this Lease and that, insofar as Tenant knows, no other broker
negotiated this Lease or is entitled to any commission in connection herewith.
Tenant shall indemnify, defend and hold Landlord harmless from and against all
claims (and costs of defending against and investigating such claims) of any
broker or similar parties claiming under Tenant in connection with this Lease.
15.15 Memorandum of Lease. Tenant shall not record this Lease or a
-------------------
memorandum or other instrument with respect to this Lease.
15.16 Entire Agreement. This Lease, including all Exhibits attached
----------------
hereto (which Exhibits are hereby incorporated herein and shall constitute a
portion hereof), contains the entire agreement between Landlord and Tenant with
respect to the subject matter hereof. Tenant hereby acknowledges and agrees that
neither Landlord nor Landlord's agents or representatives have made any
representations, warranties, or promises with respect to the Project, the
Premises, Landlord's services, or any other matter or thing except as herein
expressly set forth, and no rights, easements, or licenses are acquired by
Tenant by implication or otherwise except as expressly set forth in this Lease.
The taking of possession of the Premises by Tenant shall be conclusive evidence,
as against Tenant, that Tenant accepts the Premises and the Project, and that
same were in good and satisfactory condition at the time such possession was so
taken. Further, the terms and provisions of this Lease shall not be construed
against or in favor of a party hereto merely because such party is the
"Landlord" or the "Tenant" hereunder or such party or its counsel is the
draftsman of this Lease.
15.17 Time of Essence. Time is of the essence of this Lease and each and
---------------
all of its provisions in which performance is a factor.
15.18 Parking. Tenant shall have the right to use the parking facilities of
-------
the Building, subject to the rules and regulations of Landlord for such parking
facilities, all as more particularly set forth on Exhibit C attached hereto and
made a part hereof for all purposes.
15.19 Tenant Taxes. Tenant shall pay, or cause to be paid, before
------------
delinquency, any and all taxes levied or assessed and which become payable
during the Term upon all of Tenant's equipment, furniture, fixtures and personal
property located in the Premises, except that which has been paid for by
Landlord and is the standard of the Building. If the assessed value of the
Project is increased by inclusion of personal property, furniture, fixtures or
equipment placed by Tenant in the Premises and Landlord elects to pay such
taxes, charges and other assessments based on such increase, Tenant shall pay
Landlord upon demand that part of the taxes, charges and other assessments for
which Tenant is primarily liable hereunder.
15.20 Attorney's Fees. In the event either party to this Lease commences
---------------
legal action of any kind to enforce the terms and conditions of this Lease, the
prevailing party in such litigation shall be entitled to collect from the other
party all reasonable costs, expenses and attorney's fees incurred in connection
with such action.
15.21 Landlord Alterations or Modifications. Notwithstanding anything
-------------------------------------
herein to the contrary, Landlord expressly reserves the right in its sole
discretion to temporarily or permanently change the location of, close, block or
otherwise alter any entrances, corridors skywalks, tunnels, doorways, or
walkways leading to or providing access to the Building or any part thereof or
otherwise restrict the use of same provided such acts do not unreasonably impair
Tenant's access to the Premises. Landlord shall not incur any liability
whatsoever to Tenant as a consequence thereof and such acts shall not be deemed
to be a breach of any of Landlord's obligations hereunder.
15.22 Name Change. Landlord and Tenant covenant and agree that Landlord
-----------
hereby reserves and shall have the right at any time and from time to time to
change the name of the Building as Landlord may deem advisable, and Landlord
shall not incur any liability whatsoever to Tenant as a consequence thereof.
15.23 Publication. Tenant hereby agrees that Landlord shall have the
-----------
right, but not the obligation, at no cost to Tenant, to publicize and/or
advertise the execution of this Lease and the related transaction.
15.24 Waiver of Consumer Rights. Tenant hereby waives its rights under
-------------------------
the Deceptive Trade Practices - Consumer Protection Act, Section 17.41 et seq.,
-- ---
Business & Commerce Code, a law that gives consumers special rights and
protections. After consultation with an attorney/legal counsel of its own
selection, Tenant voluntarily consents to the waiver. Tenant covenants,
represents and warrants that such attorney/legal counsel was not directly or
indirectly identified, suggested, or selected by Landlord or an agent of
Landlord.
-9-
EXECUTED effective as of the date hereinabove first set forth.
LANDLORD:
--------
LAKE AUSTIN COMMONS, LTD., a Texas
limited partnership
By: Sage Land Company, Inc., its General Partner
By:/s/ WM. XXXXXX
-----------------------------------------
Name: Wm. Xxxxxx
---------------------------------------
Title: President
--------------------------------------
TENANT:
------
Clinicor, Inc.
By:/s/ XXXXX X. XXXXXXX-XXXX
-----------------------------------------
Name: Xxxxx X. Xxxxxxx-Xxxx
---------------------------------------
Title: Vice President, CFO
--------------------------------------
-00-
XXXXXXX "X"
XXXXX PLANS
-----------
HARTLAND PLAZA - FOURTH FLOOR PLAN
[FLOOR PLAN APPEARS HERE]
-11-
EXHIBIT "A-1"
LEGAL DESCRIPTION
-----------------
Xxxx 0 xxx 0, Xxxx Xxxxxx Xxxxxxx XXX, according to Map or Plat of
Record in Plat Book 83, Page 58C of the Plat Records of Xxxxxx County, Texas.
-12-
EXHIBIT "B"
LEASE DATED October 23, 0000 XXXXXXX
XXXX XXXXXX COMMONS, LTD.
as LANDLORD
and
Clinicor, Inc.
as TENANT
RULES AND REGULATIONS
---------------------
1. Landlord shall have the right to prescribe the weight, position and
manner of installation of safes or other heavy equipment which shall, if
considered necessary by Landlord, be installed in a manner which shall insure
satisfactory weight distribution. The time, routing and manner of moving safes
or other heavy equipment shall be subject to prior approval by Landlord.
2. Tenant, or the employees, agents, servants, visitors or licensees of
Tenant shall not at any time, place, leave or discard any rubbish, paper,
articles or objects of any kind whatsoever outside the doors of the Leased
Premises or the Project. No animals or birds shall be brought or kept in or
about the Leased Premises or the Project.
3. Canvassing, soliciting or peddling in and around the Leased Premises
or the Project is prohibited and Tenant shall cooperate to prevent same.
4. Landlord shall have the right to exclude any person from the Leased
Premises or the Project other than during customary business hours as set forth
in the Leased Premises or the Lease, and any person in the Project will be
subject to identification by employees and agents of Landlord. All persons in or
entering the Leased Premises or the Project shall be required to comply with the
security policies of the Project. If Tenant desires any additional security
service for the Premises, Tenant shall have the right (with the prior written
consent of Landlord) to obtain such additional service at Tenant's sole cost and
expense. Tenant shall keep doors to unattended areas locked and shall otherwise
exercise reasonable precautions to protect property from theft, loss or damage.
Landlord shall not be responsible for the theft, loss or damage of any property
or for any error with regard to the exclusion from or admission to the Project
of any person. In case of invasion, mob, riot or public excitement, the Landlord
reserves the right to prevent access to the Project during the continuance of
same by closing the doors or taking other measures for the safety of the Tenants
and protection of the Project and property or persons therein.
5. Only workmen employed, designated or approved by Landlord may be
employed for repairs, installations, alterations, painting, material moving and
other similar work that may be done in or on the Premises.
6. Tenant shall not do any cooking (except with a microwave oven) or
conduct any restaurant, luncheonette, or cafeteria for the sale or service of
food or beverages to its employees or to others, or permit the delivery of any
food or beverage to the Premises (except for coke or snack machines), except by
such persons delivering the same as shall be approved by Landlord and only under
regulations filed by Landlord. Tenant may, however, operate a coffee bar and
allow the use of a microwave oven for its employees.
7. Tenant shall not bring or permit to be brought or kept in or on the
Premises or Project any flammable, combustible, corrosive, caustic, poisonous or
explosive substance, or cause or permit any odors to permeate in or emanate from
the Premises, or permit or suffer the Premises to be occupied or used in a
manner offensive or objectionable to Landlord or other occupants of the Project
by reason of light, radiation, magnetism, noise, odors and/or vibrations, or
interfere in any way with other tenants of those having business in the Project.
8. Tenant shall not xxxx, paint, drill into or in way deface any part
of the Project or the Premises. Tenant shall not install any resilient tile or
similar floor covering in the Premises except with the prior approval of
Landlord. The use of cement or other similar adhesive material is expressly
prohibited.
9. No additional locks or bolts of any kind shall be place on any door
in the Project or the Premises and no lock on any door therein shall be changed
or altered in any respect. Landlord shall furnish two keys for each lock on
exterior doors to the Premises and shall, on Tenant's request and at Tenant's
expense, provide additional duplicate keys. All keys shall be returned to
Landlord upon the termination of this Lease and Tenant shall give to Landlord
the explanations of the combinations of all safes, vaults and combination locks
remaining with the Premises. Landlord may at all times keep a pass key to the
Premises. All entrance doors to the Premises shall be left closed at all times
and left locked when the Premises are not in use. Tenant shall not be obligated
to provide Landlord with a key to Tenant's Drug Room in the Premises.
10. Tenant shall give immediate notice to Landlord in case of theft,
unauthorized solicitation or accident in the Premises or in the Project or of
defects therein or in any fixtures or equipment or of any known emergency in the
Project.
11. Tenant shall not allow the Premises to be used for photographic
multilith or multigraph reproductions, except in connection with its own
business and not as a service for others without Landlord's prior written
consent.
12. Tenant shall not advertise for laborers giving the Premises as an
address, nor pay such laborers at a location in the Premises.
13. The requirements of Tenant will be attended to only upon
application at the office of Landlord in the Building or at such other address
as may be designated by Landlord in the Lease. Employees of Landlord shall not
perform any work or do anything outside of their regular duties unless under
special instructions from the office of Landlord.
14. Tenants shall not place a load upon any floor of the Premises that
exceeds the load per square foot that such floor was designed to carry and that
is allowed by law. Business machines and mechanical and electrical equipment
belonging to Tenant that cause noise, vibration electrical or magnetic
interference, or any other nuisance that may be transmitted to the structure or
other portions of the Project or to the Premises to such a degree as to be
objectionable to Landlord or that interfere with the use or enjoyment by other
tenants of their premises or the public portions of the Project shall be placed
and maintained by Tenant, at Tenant's expense, in settings of cork, rubber,
spring type, or other vibration eliminators sufficient to eliminate noise or
vibration.
15. Except with the prior written consent of Landlord, awnings,
draperies, shutters or other interior or exterior window coverings that are
visible from the exterior of the Building or from the exterior of the Premises
within the Building may be installed by Tenant.
16. Tenant shall not place, install or operate within the Premises or
any other part of the Project any engine, stove, or machinery, or conduct
mechanical operations therein, without the written consent of Landlord.
17. No portion of the Premises or any other part of the Project shall
at any time be used or occupied as sleeping or lodging quarters.
-13-
18. For purposes of the Lease, holidays shall be deemed to mean and
include, without limitation, the following: (a) New Year's Day; (b) Good Friday;
(c) Memorial Day; (d) Independence Day; (e) Labor Day; (f) Thanksgiving Day; (g)
the Friday following Thanksgiving Day; (h) Christmas Day; and (i) any other
holiday generally recognized by buildings of similar size, location and quality.
19. Tenant shall at all times keep any portions of the Premises that
are visible from public areas neat and orderly.
20. The toilet rooms, urinals, wash bowls and other apparatus shall not
be used for any purpose other than that for which they were constructed and no
foreign substance of any kind whatsoever shall be thrown therein and the expense
of any breakage, stoppage or damage resulting from the violation of this rule
shall be borne by the Tenant who or whose employees or invitees shall have
caused it.
21. Landlord reserves the right to exclude or expel from the Project
any person who, in the judgment of Landlord, is intoxicated or under the
influence of liquor or drugs, or who shall in any manner do any act in violation
of any of the Rules and Regulations of the Project.
22. Landlord reserves the right, without the approval of Tenant, to
rescind, add to and amend any rules or regulations, to add new rules or
regulations, and to waive any rules or regulations with respect to any tenant or
tenants, but only so long as such new rules or amendments to rules do not
materially affect Tenant's use and enjoyment of the Premises for the Permitted
Use.
-14-
EXHIBIT C
TO
LEASE DATED October 23, 0000 XXXXXXX
XXXX XXXXXX COMMONS, LTD.
as LANDLORD
and
Clinicor, Inc.
as TENANT
PARKING
-------
(a) At all times during the term of this Lease (as same may be
extended), Landlord agrees to lease to Tenant and Tenant agrees to lease from
Landlord (i) seventeen (17) parking spaces in the uncovered parking lot (the
"West Lot") located immediately to the west of the Building, (ii) sixteen (16)
--------
parking spaces in the uncovered parking lot (the "South Lot") located across
---------
Fifth Street from the Building, and (ii) Seventeen (17) parking spaces in the
structured parking facility (the "Structured Facility") located appurtenant to
-------------------
the Building. Five of the spaces in the Structured Facility shall be marked as
reserved for Tenant near the elevator located on level G3 of the Structured
Facility; provided however, if more than forty percent (40%) of the parking
spaces in the Structured Facility are reserved for tenants of the Building, then
a like percentage of Tenant's spaces in the Structured Facility shall be
designated as reserved. Unless otherwise provided in this Exhibit, no specific
spaces in the Outdoor Facility or the Structured Facility are to be assigned to
Tenant. Landlord may designate the area within which each such vehicle may be
parked, and may change such designations from time to time. Landlord may make,
modify and enforce rules and regulations relating to the parking of automobiles,
and Tenant will abide by such rules and regulations so long as such rules and
regulations do not materially and adversely affect Tenant's use of such parking
spaces. Landlord also reserves the right to increase the size of the Structured
Facility or to construct a new building or structured parking facility on all or
any part of the West Lot or the South Lot, provided that Tenant at all times
remains entitled to parking spaces at the rates and quantities described above
in the West Lot, the South Lot, the Structured Facility, the New Lot (as
hereinafter defined) and/or any other available alternative lot.
(b) Tenant covenants and agrees to pay to Landlord during the term of
this Lease, as additional rent hereunder, the sum of $20.00 per month for each
parking space in the Structured Facility and the sum of $0.00 per month for each
parking space in the West Lot or the South Lot, such sums (collectively the
"Basic Parking Charge") to be payable monthly in advance on the first day of
--------------------
each and every calendar month during the term of this Lease, and a pro rata
portion of such sums shall be payable for the first partial calendar month in
the event the term of this Lease commences on a date other than the first day of
a calendar month. Tenant's obligation to pay the Basic Parking Charge shall be
considered an obligation to pay rent for all purposes hereunder, and any default
in the payment of the Basic Parking Charge shall be deemed a default in the
payment of rent hereunder.
(c) Subject to obtaining the necessary permits and approvals of the
City of Austin, Landlord shall use its good faith efforts to construct a new
parking lot (the "New Lot") on the site that is south and east of the South Lot
-------
within one (1) year after the date hereof. Upon the completion of the New Lot,
Tenant may, at its option, lease up to eleven (11) parking spaces in the New Lot
at the monthly rate of $20.00 per space. If a New Lot has not been completed by
March 1, 1997, then Landlord shall lease to Tenant at the rate of $20.00 per
space per month, until the completion of the New Lot, six (6) additional
unreserved parking spaces in the South Lot.
(d) Tenant agrees to furnish to Landlord the state automobile license
numbers assigned to automobiles of Tenant and its employees within seven (7)
days from its receipt of written notice from Landlord requesting such
information. Landlord shall not be liable or responsible for any loss of or to
any car or vehicle or equipment or other property therein or damage to property
or personal injuries (fatal or nonfatal), except if caused by Landlord's gross
negligence or willful misconduct.
(e) In the event any of the above parking spaces are or become permanently
unavailable at any time or from time to time throughout the Term, whether due to
condemnation, casualty or any other cause beyond the reasonable control of
Landlord, the Lease shall continue in full force and effect, it being expressly
agreed and understood that Landlord's only duty shall be to make a good faith
effort to provide substitute parking spaces for those spaces rendered
unavailable in the New Lot, the West Lot, the South Lot, the Structured Facility
and/or any other available alternative lot, provided, however, in the event that
any of the above parking spaces become permanently unavailable and Landlord is
unable to provide substitute parking spaces in the lots described above such
that Tenant has at least forty-four (44) parking spaces at the rates described
above, Tenant shall be entitled to terminate this Lease by delivering written
notice to Landlord within ten (10) business days after the number of parking
spaces available to Tenant falls below forty-four (44). In the event that Tenant
so terminates this Lease, Landlord shall refund to Tenant an amount of the
Construction Fee equal to (i) $5,227.85, times (ii) the number of months
remaining in the initial Term of this Lease as of the date of termination. If
Tenant does not terminate this Lease within such ten (10) business day period,
Tenant shall have no further right to terminate this Lease pursuant to this
Exhibit C.
-15-
EXHIBIT D
TO
LEASE DATED October 23, 0000 XXXXXXX
XXXX XXXXXX COMMONS, LTD.
as LANDLORD
and
Clinicor, Inc.
as TENANT
COMMENCEMENT DATE DECLARATION
-----------------------------
With respect to that certain Office Lease Agreement (the "Lease") dated
-----
October 23, 1996, by and between LAKE AUSTIN COMMONS, LTD. ("Landlord") and
--------
Clinicor, Inc. ("Tenant"), covering approximately 15,180 square feet of the net
------
rentable area on 4th floor of HARTLAND PLAZA (the "Building"), by their
--------
respective execution below, Landlord and Tenant each hereby stipulates and
agrees that the Commencement Date (as defined in Section 1.06 of the Lease)
occurred on _____________, 19__ . This declaration may be relied upon by any
person having or acquiring an interest in the Lease or the Building, without
notice to or consent of Landlord or Tenant.
LAKE AUSTIN COMMONS LTD., a Texas limited
partnership
By: Sage Land Company, Inc., its General Partner
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
TENANT:
------
Clinicor, Inc.
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
-16-
EXHIBIT E
TO
LEASE DATED October 23, 0000 XXXXXXX
XXXX XXXXXX COMMONS, LTD.
as LANDLORD
and
Clinicor, Inc.
as Tenant
WORK LETTER
-----------
1. Completion Schedule.
Within ten (10) days after the execution of the Lease, Landlord shall
deliver to Tenant, for Tenant's review and approval, a schedule (the "Work
----
Schedule") setting forth a timetable for the planning and completion of the
--------
installation of the Tenant Improvements (as defined in Paragraph 2 below) to be
constructed in the Premises. The Work Schedule shall set forth each of the
various items of work to be done by or approval to be given by Landlord and
Tenant in connection with the completion of the Tenant Improvements. The Work
Schedule shall be submitted to Tenant for its approval and, upon approval by
both Landlord and Tenant, such Work Schedule shall become the basis for
completing the Tenant Improvements. If Tenant shall fail to approve the Work
Schedule, as it may be modified after discussions between Landlord and Tenant,
within five (5) business days after the date the Work Schedule is first received
by Tenant, Landlord may, at its option, terminate the Lease and all of its
obligations thereunder.
2. Tenant Improvements.
Reference herein to "Tenant Improvements" shall include all work to be
done in the Premises pursuant to the Tenant Improvement Plans (defined in
Paragraph 3 below), including, but not limited to, partitioning, doors,
ceilings, floor coverings, wall finishes (including paint and all covering),
electrical (including lighting, switching, telephones, outlets, etc.), plumbing,
heating, ventilating and air conditioning, fire protection, cabinets, and other
millwork.
3. Tenant Improvement Plans.
Immediately after the execution of the Lease, Tenant agrees to meet
with Landlord's architect and/or space planner for the purpose of promptly
preparing a space plan for the layout of the Premises. Based upon such space
plan, Landlord's architect shall prepare final working drawings and
specifications for the Tenant Improvements. Such final working drawings and
specifications are referred to herein as the "Tenant Improvements Plans". The
Tenant Improvement Plans must be consistent with Landlord's standard
specifications (herein referred to as the "Standards" or "Building Standards")
for tenant improvements for the Building as the same may be changed from time to
time by Landlord. Landlord's approval of the Tenant Improvements Plans shall
create or impose no liability or responsibility on Landlord for their
completeness, design sufficiency or compliance with all applicable laws, rules
and regulations of governmental agencies or authorities.
4. Non-Standard Tenant Improvements.
Landlord shall permit Tenant to deviate from the Standards for the
Tenant Improvements (the "Non-Standards"), provided that (a) the deviations
-------------
shall not be of a lesser quality than the Standards; (b) the deviations conform
to applicable governmental regulations and necessary governmental permits and
approvals have been secured, (c) the deviations do not require building service
beyond the level normally provided to other tenants in the Building and do not
overload the floors; and (d) Landlord has determined in its sole discretion that
the deviations are of a nature and quality that are consistent with the overall
objectives of the Landlord for the Building.
5. Final Pricing and Drawing Schedule.
After the preparation of the space plan and after Tenant's written
approval thereof, in accordance with the Work Schedule. Landlord shall cause its
architect to prepare and submit to Tenant the Tenant Improvement Plans. The
Tenant Improvement Plans shall be approved by Landlord and Tenant in accordance
with the Work Schedule and shall thereafter be submitted to the appropriate
governmental body by Landlord's architect for plan checking and the issuance of
a building permit. Landlord, with Tenant's cooperation, shall cause to be made
to the Tenant Improvement Plans any changes necessary to obtain the building
permit. Concurrent with the plan checking, Landlord shall have prepared a final
pricing for Tenant's approval, in accordance with the Work Schedule, taking into
account any modifications which may be required to reflect changes in the Tenant
Improvement Plans required by the city or county in which the Premises are
located. After final approval of the Tenant Improvement Plans, no further
changes may be made thereto without the prior written approval from both
Landlord and Tenant, and then only after agreement by Tenant to pay any excess
costs resulting from the design and/or construction of such changes. Tenant
hereby acknowledges that any such changes shall be subject to the terms of
Paragraph 8 below.
6. Construction of Tenant Improvements.
After the Tenant Improvement Plans have been prepared and approved, the
final pricing has been approved and a building permit for the Tenant
Improvements has been issued, Landlord shall cause its contractor to begin
installation of the Tenant Improvements in accordance with the Tenant
Improvement Plans. Landlord shall supervise the completion of such work and
shall use its best efforts to secure substantial completion of the work in
accordance with the Work Schedule. The cost of such work shall be paid as
provided in Paragraph 7 below. Landlord shall not be liable for any direct or
indirect damages as a result of delays in construction beyond Landlord's
reasonable control, including, but not limited to, acts of God, inability to
secure governmental approvals or permits, governmental restrictions, strikes,
availability of materials or labor, or delays by Tenant (or its architect or
anyone performing services on behalf of Tenant).
-17-
7. Payment for the Tenant Improvements.
(a) Landlord hereby grants to Tenant the "Tenant Improvement
Allowances" set forth in Section 1.18 of the Lease. The Tenant Improvement
Allowance shall be used only for:
(i) Except as otherwise agreed to in writing by Landlord and
Tenant, payment of the cost of preparing the space plan and the Tenant
Improvement Plans, including mechanical, electrical, plumbing and
structural drawings, and of all other aspects necessary to complete the
Tenant Improvement Plans. The Tenant Improvement Allowance will not be
used for the payment of extraordinary design work not included within
the scope of Landlord's Standards.
(ii) Payment of plan check, permit, and license fees relating
to construction of the Tenant Improvements.
(iii) Construction of the Tenant Improvements, including, but not
limited to, the following:
(aa) Installation within the Premises of all partitioning,
doors, floor coverings, ceiling, wall coverings and painting,
millwork, and similar items;
(bb) All electrical wiring, lighting fixtures, outlets and
switches, and other electrical work to be installed within the
Premises;
(cc) The furnishing and installation of all duct work,
terminal boxes, diffusers, and accessories required for the
completion of the heating, ventilation and air conditioning systems
within the Premises, including the cost of electrical consumption
meters and card key controls for after-hour air conditioning;
(dd) Any additional Tenant requirements, including, but not
limited to, odor control, special heating, ventilation and air
conditioning, noise or vibration control, or other Special systems;
(ee) All fire and life safety control systems such as fire
walls, halon, fire alarms, including piping, wiring and accessories
installed within the Premises;
(ff) All plumbing, fixtures, pipes and accessories to be
installed within the Premises;
(gg) Testing and inspection costs; and
(hh) Contractors' fees, including but not limited to any fees
based on general conditions, but excluding supervisory fees owed by
Landlord to the Building property management company.
(iv) All other reasonable costs to be expended by Landlord in
the construction of the Tenant Improvements.
(b) The cost of each item referenced in Paragraph 7(a) above shall be
charged against the Tenant Improvement Allowance. In the event that the cost of
installing the Tenant Improvements, as established by Landlord's final pricing
schedule, shall exceed the Tenant Improvement Allowance, or if any of the Tenant
Improvements are not to be paid out of the Tenant Improvement Allowance as
provided in Paragraph 7(a) above, the excess shall be paid by Tenant to Landlord
after the commencement of construction of the Tenant Improvements.
(c) In the event that, after the Tenant Improvement Plans have been
prepared and a price therefor established by Landlord, Tenant shall require any
changes or substitutions to the Tenant Improvement Plans, any additional costs
related thereto shall be paid by Tenant to Landlord after the commencement of
construction of the Tenant Improvements. Landlord shall have the right to
decline Tenant's request for change to the Tenant Improvement Plans if such
changes are inconsistent with the provisions of Paragraphs 3 and 4 above, or if
the change would, in Landlord's opinion, unreasonably delay construction of the
Tenant Improvements.
(d) In the event that increases in the cost of the Tenant Improvements
as set forth in Landlord's final pricing are due to the requirements of any
governmental agency, Tenant shall pay Landlord the amount of such increase
within five (5) days of Landlord's written notice; provided, however, that
Landlord shall first apply toward such increase any remaining balance in the
Tenant Improvement Allowance.
(e) Any unused portion of the Tenant Improvement Allowance upon
completion of the Tenant Improvements shall be refunded to Tenant or available
to Tenant as a credit against any obligations of Tenant under the Lease.
8. Completion Date.
The "substantial completion date" for work described herein shall occur
on the date when all of the work described in the Tenant Improvement Plans is
complete, as evidenced by the issuance of a temporary Certificate of Occupancy
with respect to the Premises, or the date such work would be substantially
complete but for (a) Tenant's failure to approve any items or perform any other
obligation in accordance with and by the date specified in the Work Schedule;
(b) Tenant's request for materials, finishes or installations other than those
readily available; (c) Tenant's changes in the Tenant Improvement Plans after
the approval by Tenant; or (d) Tenant's request to deviate from the Standards
for Tenant Improvements. So long as a temporary Certificate of Occupancy has
been issued, the Tenant Improvements shall be deemed substantially complete
notwithstanding the fact that minor details of construction, mechanical
adjustments or decorations which do not materially interfere with Tenant's use
of the Premises remain to be performed (items normally referred to as "punch
list" items). Landlord and Tenant shall complete one punch list inspection and
Landlord shall complete and/or correct such punch list items within a reasonable
period of time.
-18-
EXHIBIT F
TO
LEASE DATED October 23, 0000 XXXXXXX
XXXX XXXXXX COMMONS, LTD.
as LANDLORD
and
Clinicor, Inc.
as TENANT
RENEWAL OPTION
--------------
Provided (i) that a Default by Tenant has not occurred and is
continuing, and (ii) Tenant's shareholders' equity (as reflected in Tenant's
Financial Statements) has at all times during the term of this Lease been in
excess of $2,000,000, Tenant shall have the right to renew and extend this Lease
with respect to all, but not less than all, of the Premises for one (1) renewal
term of 3 years, such renewal term commencing upon the expiration of the initial
Term. Such renewal option must be exercised, if at all, by Tenant giving
Landlord written notice thereof at least six (6) months prior to the expiration
of the initial Term. In the event that Tenant fails to give such notice in the
manner provided herein, such renewal option shall terminate. In the event of
such renewal, the "Term" shall include such renewal term and such renewal shall
be upon the same provisions as for the initial Term except that:
1. Tenant shall pay additional Base Rent to Landlord in monthly
installments in an amount equal to the rate (the "Renewal Rate") then being
------------
generally quoted by Landlord for comparable space in the Building as of the
commencement of the renewal Term, but in no event less than the rate of Base
Rent in effect at the expiration of the initial Term. In addition, during such
renewal term, Tenant shall pay all other Rent and other amounts due under the
Lease, including without limitation, all rental adjustments pursuant to Article
3 of the Lease. Landlord shall notify Tenant of the Renewal Rate within fifteen
(15) business days after Landlord receives Tenant's renewal notice. If Tenant
does not approve of the Renewal Rate for the renewal term, then Tenant, as its
sole remedy, may revoke its election to renew by giving written notice thereof
to Landlord within five (5) days after Landlord has notified Tenant of the
Renewal Rate for the renewal term, but otherwise Tenant may not revoke its
election to renew after such election has been made.
2. Landlord shall not be obligated to make any alterations or
improvements to the Premises.
3. Except for the renewal option described above, Tenant shall have no
further right to renew this Lease.
-19-
EXHIBIT G
TO
LEASE DATED October 23, 0000 XXXXXXX
XXXX XXXXXX COMONS, LTD.
as LANDLORD
and
Clinicor, Inc.
as TENANT
FIRST RIGHT OF REFUSAL
----------------------
(a) From and after the Commencement Date, but only so long as (i) at
least three (3) years remain in the Term of this Lease (as such Term may have
been theretofore extended), and (ii) a Default by Tenant has not occurred and is
continuing, Tenant shall have, and is hereby granted, a right of first refusal
with respect to that certain space located adjacent to the Premises, identified
as Suite 410, as shown on Addendum A attached hereto (such space being referred
----------
to as the "Additional Space"). If Landlord receives an offer to lease the
----------------
Additional Space or any portion thereof that is acceptable to Landlord
(hereinafter referred to as the "Offer"), Landlord will give written notice to
-----
Tenant of the pertinent business terms and conditions of the offer (the
"Notice"). Tenant will thereafter have the option, exercisable by written notice
------
delivered to Landlord within ten (10) business days after receipt by Tenant of
the Notice, to lease such portion of the Additional Space covered by the Offer,
upon the terms and conditions set forth in the Notice; provided, however, (x)
Tenant shall be entitled to only a pro rata portion of any tenant improvements
allowance provided for in the Offer, and (y) the term of Tenant's lease of such
portion of the Additional Space shall be coterminous with the Term of the Lease.
Failure by Tenant to deliver to Landlord written notice of Tenant's acceptance
of the offer set forth in the Notice will be deemed to be an election by Tenant
not to exercise such option.
(b) If Tenant exercises Tenant's option to lease such portion of the
Additional Space, Tenant and Landlord will enter into a mutually acceptable
lease or lease amendment with respect to such space upon the business terms and
conditions contained in the Notice as set forth above. If Tenant elects, or is
deemed to have elected, not to exercise such option, or if Landlord and Tenant
fail to agree upon a mutually acceptable lease or lease amendment with respect
to such space with ten (10) business days after receipt by Landlord of Tenant's
exercise of such option, Landlord will be free to lease such portion of the
Additional Space described in the Offer to any prospective lessee upon
substantially the same terms and conditions as were presented to Tenant in the
Notice and upon which Tenant elected or was deemed to have elected not to
exercise its option.
(c) The rights granted by this paragraph shall not be severable from
this Lease, nor may such rights be assigned or otherwise conveyed by Tenant to a
sublessee of the Premises or assignee of Tenant's interest in the Lease or any
other party.
-20-
ADDENDUM A
TO
LEASE DATED October 23, 0000 XXXXXXX
XXXX XXXXXX COMONS, LTD.
as LANDLORD
and
Clinicor, Inc.
as TENANT
HARTLAND PLAZA - FOURTH FLOOR PLAN
[FLOOR PLAN APPEARS HERE}
-21-
