Second Extension Agreement And Supplement
This Second Extension Agreement and Supplement, dated as of November __,
2002 (this "Extension"), is made by and between Corporate Realty Income Fund I,
L.P., a Delaware limited partnership, as landlord (together with its successors
and assigns, "Landlord"), and Verizon Directories Corp., a Delaware corporation,
as successor-in-interest to GTE Directories Corporation, a Delaware corporation,
as tenant (together with its successors and permitted assigns, "Tenant").
Reference is hereby made to that certain Lease, dated as of April 20, 1994, as
amended by Amendment No. 1 to Lease, dated as of July 29, 1994, as further
amended by Amendment No. 2 to Lease, dated as of February 22, 1995 as further
amended and supplemented by letter dated July 31, 1996, and as further amended
and supplemented by Extension Agreement and Supplement dated as of March 31,
2000 (collectively, the "Original Lease" and, together with this Extension, the
"Lease"), each between the Tenant and Landlord with respect to the leasing by
Tenant from Landlord of the Premises, more fully described below. All
capitalized terms used and not otherwise defined herein shall have the meanings
set forth in the Original Lease.
PRELIMINARY STATEMENT
Landlord is the owner of a building located at 0000 Xxxxxxxxx Xxxxx,
Xxxxxx, Xxxxx, the Directory Building (the "Development"), of which 100% of
rentable space thereof consisting of 152,121 rentable square feet (the
"Premises") has been leased by Landlord to Tenant pursuant to the Original
Lease. The Primary Term of the Original Lease expired on September 30, 2000 and,
in accordance with the Extension Agreement and Supplement dated as of March 31,
2000, the Term of the Original Lease was extended to September 30, 2003. Subject
to the terms and conditions contained herein, Tenant and Landlord each desire to
extend the Term of the Original Lease to December 31, 2007, which extension, in
accordance with this Extension, shall be deemed to commence on January 1, 2003.
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. Extension of the Term of the Lease. Upon the satisfaction of the conditions
set forth in Section 2 below as of the date of execution and delivery hereof and
as of January 1, 2003 (unless waived by Landlord), the Term of the Original
Lease shall be extended 51 months and such extension shall commence on January
1, 2003 and expire on December 31, 2007. Each party shall continue to be fully
obligated to pay and perform under the Original Lease as if the original
expiration date thereunder was December 31, 2007, on the same terms and
conditions as provided in the Original Lease, subject to the modifications
thereof set forth in Section 3 below. Such extension shall constitute the Second
Renewal Term, as defined below. This Extension shall constitute a supplement to
the Lease, incorporating the terms of Section 3 of this Extension into the
Lease.
2. Extension Conditions. The extension of the Term of the Original Lease to
December 31, 2007 by Landlord and the effectiveness of the other modifications
contemplated hereby is subject to the satisfactory performance by Tenant of the
following conditions:
(i) the representations set forth in Section 4(a) hereof are true,
correct and complete; and
(ii) no default or Event of Default by Tenant shall have occurred
under the Lease and be continuing.
3. Modifications to the Original Lease. Landlord and Tenant hereby agree that
notwithstanding the terms of the Original Lease and, where applicable, in
substitution for such terms, the following provisions of the Original Lease are
hereby modified:
(a) Each reference in the Original Lease to "GTE Directories Corporation"
is hereby deleted and the name, "Verizon Directories Corp." is substituted
therefor.
(b) Each of Section 1 and Section 25 of the Original Lease is hereby
amended by deleting the address of the Tenant set forth therein and inserting in
its place the following: c/o The Staubach Company, Attn: Lease Administration,
000 Xxxxxx Xxxxx, XX: SV1 E5141, Xxxxxxx, XX 00000
(c) Section 5c. of the Original Lease is hereby amended by deleting such
subsection in its entirety and inserting the following in its place:
c. Renewal Term.
(i) This Lease shall have an initial Renewal Term (the "Initial Renewal
Term") commencing on October 1, 2000 and continuing to and including
December 31, 2002. This Lease shall have a second Renewal Term (the
"Second Renewal Term") commencing on January 1, 2003 and, subject to
Section 5d. hereof, continuing to and including December 31, 2007.
(ii) With regard to any Renewal Term, as defined herein, other than the
Initial Renewal Term and the Second Renewal Term, and so long as no
termination of this Lease shall have occurred pursuant to Section 5d.
hereof, Landlord and Tenant may negotiate in good faith two (2) sixty (60)
month renewal terms of the Lease on the same terms and conditions as the
Second Renewal Term, except for the Base Rent payable during such Renewal
Term(s), which shall be determined in accordance with Section 7a.(iii) of
this Lease, and except for such terms and conditions as may be mutually
agreeable to Landlord and Tenant.
(iii) If Landlord and Tenant cannot reach mutual agreement of material
terms for a renewal of this Lease and if Landlord shall have received and
consented to an irrevocable notice of extension in the form of Exhibit D
hereto (the "Notice of Extension") at least 180 days prior to the
expiration of the Second Renewal Term or the third Renewal Term, Landlord
and Tenant shall each choose, within 15 days of delivery of an
acknowledged Notice of Extension and at their own cost
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and expense, a real estate broker, having at least 8 years of experience
in commercial real estate leasing, to review the proposed renewal of this
Lease. Such experts shall review the disagreement of such material terms.
Landlord and Tenant shall pay the costs and expenses of the broker
selected by each of them respectively. Within 30 days of their
appointment, such experts shall mutually agree in writing upon such terms
based on prevailing market conditions. If such experts cannot reach
agreement on such terms, then such experts shall mutually agree on a third
independent, qualified expert, having at least 8 years of experience in
commercial real estate leasing, the cost and expense of whom shall be paid
equally by Landlord and Tenant, to review the disagreement of such
material terms. Within 30 days of its appointment, such expert shall state
in writing its opinion of appropriate terms based on prevailing market
conditions. Landlord and Tenant agree to abide by whatever conclusion is
reached with respect to such disagreement pursuant hereto however such
conclusion is reached by the experts and agree to prepare and deliver,
within 30 days of receipt thereof, documentation incorporating such
conclusion.
The foregoing clauses (ii) and (iii) relate solely to each Renewal Term
other than the Initial Renewal Term and the Second Renewal Term.
(iv) The Initial Renewal Term and the Second Renewal Term, together with
each of the two (2) additional sixty (60) month renewal terms described
above, if any, are each called a "Renewal Term" and, together with the
Initial Term and the Primary Term, are collectively called the "Term". The
Second Renewal Term shall commence on January 1, 2003 and the third
Renewal Term, if any, shall commence on the day after the end of the
Second Renewal Term and the fourth Renewal Term shall commence on the date
after the end of the third Renewal Term.
(d) Section 5 of the Original Lease is hereby amended by inserting the
following subsection immediately after Section 5c.:
d. Termination Right. Tenant shall have the option to terminate this Lease
during each Renewal Term beginning with the Second Renewal Term pursuant
to the terms and conditions set forth in this Section 5d. Tenant may
terminate the applicable Renewal Term on the last day (the "Termination
Date") of the thirty-sixth (36th) month following the commencement of such
Renewal Term (with respect to the Second Renewal Term, such day being
December 31, 2005), provided Tenant complies with the following
conditions: (1) Tenant delivers irrevocable written notice to Landlord on
or before the date which is 270 days prior to the Termination Date
evidencing Tenant's election to terminate this Lease on the respective
Termination Date; (2) no default or Event of Default by Tenant shall have
occurred under the Lease from the date of such termination notice to the
Termination Date; (3) on the Termination Date, Tenant shall have
surrendered possession of the Premises in accordance with the terms of the
Lease; and (4) on the Termination Date, Tenant shall have paid to Landlord
in immediately available funds all Rent due and owing under the Lease
including all accrued and
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unpaid Base Rent and Additional Rent together with an amount equal to the
product of (x) costs and expenses incurred by Landlord in performing (or
paid by Landlord to have performed) any improvements to the Premises as
partial consideration for agreeing to the related Renewal Term plus all
commissions and brokerage fees paid by Landlord in connection with the
extension of the Term for the related Renewal Term plus any other
concession made by Landlord or expense incurred by Landlord in
consideration of the extension of the Term for the related Renewal Term
(which, for the Second Renewal Term, shall include $256,704, an amount
equal to the rent concession made by Landlord for the period from the
commencement date for such Renewal Term to September 30, 2003) and (y) a
fraction, the numerator of which is the number of months remaining in such
Renewal Term and the denominator of which is the number of months from the
commencement date to the expiration date for such Renewal Term had there
been no termination (which, in the case of the Second Renewal Term shall
equal fifty-one (51) months so as to avoid any duplication of amortization
periods from the First Renewal Term of the Lease). If Tenant elects to
terminate this Lease during any Renewal Term and satisfies each of the
terms and conditions set forth herein, then this Lease shall automatically
terminate on as of the respective Termination Date without the necessity
of further action by either party.
(e) Section 7a.(iii) of the Lease is hereby deleted and the following is
inserted in its place:
(iii) Renewal Rent. In the event that a Renewal Term (other than the
Initial Renewal Term or Second Renewal Term which is addressed below) has
been entered into in accordance with this Lease after the Second Renewal
Term, Tenant shall pay the monthly sum equal to 95% of Fair Market Rental
Value in advance on or before the first day of each and every calendar
month during each such Renewal Term hereof. "Fair Market Rental Value"
means a rate of the fair market rental value that would be obtained in an
arm's length transaction for cash between an informed and willing
non-expansion, non-renewal and non-equity tenant and an informed and
willing landlord, neither of whom is under any compulsion to lease, for
the use of the space of comparable size, quality, utility and location as
the Premises, taking into consideration the creditworthiness of the
tenant, the length of the term, base year and allowances and concessions
then being commonly offered by landlords for the use of such comparable
space. Determination of Fair Market Rental Value shall be made by the
parties hereto unless such term is determined by experts pursuant to
Section 5c. hereof
With regard to the Second Renewal Term, Tenant shall pay rent monthly, in
advance on or before the first day of each and every calendar month
thereof commencing on the Commencement Date, in an amount equal to
$212,335.56 which, on an annual basis, is equal to $16.75 per rentable
square foot. Such rent and all rent to be paid on a monthly basis for the
use of the Premises under this Section 7a.(iii) shall constitute "Base
Rent" and, notwithstanding the definition of "Rent" contained in Section
7a.(ii) of this Lease, "Rent" shall mean collectively
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the Base Rent, Additional Rent and all other sums to be paid by Tenant
hereunder. Accordingly, Exhibit E to the Original Lease is hereby amended
by deleting the portion thereof relating to the Renewal Term(s) and
inserting in its place for such portion the Exhibit E -- Renewal Terms as
set forth on Exhibit B to this Extension.
(f) Section 7b.(i) of the Original Lease is hereby deleted in its entirety
and the following is inserted in its place:
(i) Tenant Electric. Tenant (i) shall pay Landlord monthly the Cost of
Electricity, as defined below; (ii) shall be billed for such Cost of
Electricity by Landlord monthly, based upon Landlord's reasonable estimate
of the annual cost of electrical service to the Development using
historical costs and other relevant information; and (iii) agrees to pay
each xxxx promptly in accordance with its terms. "Cost of Electricity"
shall mean, for the particular billing period, electrical service to the
Development including, without limitation, the cost of electrical service
to the Premises, common areas and any service inspection therefor, whether
or not such electrical service was required during business or nonbusiness
hours, such business hours being set forth in paragraph 13 of the Rules
and Regulations. The reconciliation of the actual cost of electrical
service to the Development and Landlord's estimate thereof shall be
performed in the manner described in Section 7c. hereof with respect to
the Operating Expenses. The cost of electrical service for the Development
shall not be included as an Operating Expense notwithstanding references
thereto in Section 7b. (ii) hereof
(g) Section 7b.(ii) of the Original Lease is hereby amended by deleting
the first sentence thereof and inserting in its place:
For each calendar year within which falls any part of the Term commencing
after the calendar year 2003, Tenant shall pay to Landlord 100% of the
excess, if any, in Operating Expenses for such year for the Development
over the Operating Expenses for the calendar year 2003 (the "Base
Operating Expenses"). Such payment shall be prorated for any partial
calendar month or year during the Term. Base Operating Expenses shall be
paid by Landlord.
(h) Section 7d. of the Original Lease is hereby amended by deleting the
year "2000" and inserting in its place "2003".
(i) Section 15 of the Original Lease is hereby amended by (x) deleting the
first three sentences of the second paragraph and inserting in their place the
following sentence:
During the Term, Tenant, its agents and employees shall have the exclusive
right to use all of the parking spaces in the parking area set forth in
Exhibi_ A-4 hereto at no additional cost or expense.
and (y) adding a third paragraph thereto as follows:
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During the Term, Tenant, its agents and employees shall have the exclusive
right to access the vertical riser conduits in the interior of the
Development.
(j) Exhibit D to the Original Lease is hereby deleted in its entirety and
Exhibit A to this Extension is hereby substituted in its place.
(k) Exhibit E to the Original Lease is hereby amended by deleting the
portion of such exhibit relating to Renewal Terms and substituting therefor
Exhibit B to this Extension.
4. Representations and Warranties; Covenants.
(a) Tenant represents and warrants that (i) it is duly incorporated,
validly existing and in good standing under the laws of the State of Delaware;
(ii) it has all corporate power and authority to execute, deliver and perform
this Extension; (iii) the execution, delivery and performance by Tenant of this
Extension have been duly authorized by all requisite action; (iv) this
Extension, upon execution and delivery by the person executing this Extension,
shall constitute the legal, valid and binding obligation of Tenant, enforceable
against Tenant in accordance with its terms; (v) no consents, authorizations or
approvals are necessary for the execution, delivery or performance of this
Extension; (vi) it has had no dealings with any real estate broker or agents in
connection with the negotiation of this Extension other than TAG Realty
Management, Inc. and The Staubach Company; and (vii) it has accepted and
occupied all of the Premises and Development and its Tenant's Proportionate
Share is equal to 100%.
(b) Landlord represents and warrants that (i) it is duly organized,
validly existing and in good standing under the laws of the State of Delaware;
(ii) it has all power and authority to execute, deliver and perform this
Extension; (iii) the execution, delivery and performance by Landlord of this
Extension have been duly authorized by all requisite action; (iv) this
Extension, upon execution and delivery by the person executing this Extension,
shall constitute the legal, valid and binding obligation of Landlord,
enforceable against Landlord in accordance with its terms; (v) no consents,
authorizations or approvals are necessary for the execution, delivery or
performance of this Extension; and (vi) it has had no dealings with any real
estate broker or agents in connection with the negotiation of this Extension
other than TAG Realty Management, Inc. and The Staubach Company. Landlord will
pay TAG Realty Management, Inc. and The Staubach Company their commissions
pursuant to one or more separate agreements.
5. Tenant Improvements. In consideration for the fifty-one (51) month extension
of the Term pursuant to this Extension, Landlord agrees to commence upon
execution and delivery hereof and diligently pursue to completion, at its sole
cost and expense, the tenant improvement projects with respect to the
Development set forth on Exhibit C to this Extension.
6. Effectiveness. The extension of the Lease, and the other modifications to the
Lease as contemplated hereby, set forth in paragraph 3 of this Extension and
other transactions contemplated hereby other than the payments by Landlord
referenced in paragraph 4(b) hereof, shall be effective January 1, 2003 so long
as the conditions set forth in paragraph 2 hereof have been fully satisfied.
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7. Miscellaneous. This Extension (a) shall be governed by and construed in
accordance with the laws of the State of Texas; and (b) may be signed in one or
more counterparts, each of which shall be an original and all of such
counterparts taken together shall constitute but one and the same instrument.
Upon execution and delivery hereof, this Extension shall amend, supplement and
become a part of the Original Lease. The Original Lease, supplemented and
amended by this Extension, is hereby ratified and confirmed by Tenant and
Landlord in all respects. Upon execution and delivery hereof, this Extension,
together with the Original Lease, shall constitute the entire agreement between
the parties hereto notwithstanding any oral or written communications to the
contrary.
* * *
IN WITNESS WHEREOF, Landlord and Tenant have caused this Extension to be
duly executed and delivered as of the date first above written.
VERIZON DIRECTORIES CORP.
as Tenant
By: /s/ Xxxxx Xxxxxxxxxxxx
--------------------------------
Xxxxx Xxxxxxxxxxxx
GVP-Finance
CORPORATE REALTY INCOME FUND I, L.P.,
as Landlord
By: /s/ Xxxxxx X. Xxxxxxx, Xx.
--------------------------------
Xxxxxx X. Xxxxxxx, Xx.
General Partner
Exhibit A
[Form of Notice to Extend Term]
____________ __, 20__
Corporate Realty Income Fund I, L.P.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Xx.
Re: Extension of Term of Lease
Dear Sir:
This letter will serve as the Notice of Extension described in Section 5 of the
Lease, dated as of April 20, 1994, between Corporate Realty Income Fund I, L.P.,
a Delaware limited partnership, as landlord ("Landlord"), and Verizon
Directories Corp., a Delaware corporation, as successor-in-interest to GTE
Directories Corporation, a Delaware corporation, as tenant ("Tenant"), as
amended by Amendment No. 1 to Lease, dated as of July 29, 1994, as further
amended by Amendment No. 2 to Lease, dated as of February 22, 1995 as further
amended and supplemented by letter dated July 31, 1996, as further amended and
supplemented by Extension Agreement and Supplement dated as of March 31, 2000,
and as further amended and supplemented by Second Extension Agreement and
Supplement dated as of November _, 2002 (collectively, the "Lease"). Tenant
hereby notifies Landlord of its desire to continue negotiations for a 60 month
extension of the Term of the Lease, such negotiations to be in accordance with
Section 5c of the Lease. Tenant hereby confirms and ratifies its obligations
under the Lease and hereby certifies that: (i) the Lease is in full force and
effect; (ii) to its knowledge, no default or Event of Default exists under the
Lease; and (iii) all of the representations and warranties set forth in the
Lease are true, correct and complete as of the date hereof. Tenant agrees to
provide Landlord on or before the commencement of any Renewal Term certificates
of insurance evidencing the existence and amounts of such insurance as is
required by Section 12 of the Lease.
All capitalized terms used but not otherwise defined herein shall have the
meanings set forth in the Lease.
* * *
If you are agreeable to continuing negotiations for an extension of the Term of
the Lease, as contemplated by this letter and the Lease, please execute the
attached copy of this letter, containing our wet ink signature, in the
appropriate signature block set forth below and return such copy to us within 15
days.
VERIZON DIRECTORIES CORP.,
a Delaware Corporation
as Tenant
By: /s/ Xxxxx Xxxxxxxxxxxx
--------------------------------
Xxxxx Xxxxxxxxxxxx
GVP-Finance
ACKNOWLEDGED AND AGREED TO BY:
CORPORATE REALTY INCOME FUND I, L.P.,
as Landlord
By: /s/ Xxxxxx X. Xxxxxxx, Xx.
--------------------------------
Xxxxxx X. Xxxxxxx, Xx.
General Partner
Exhibit B
Exhibit E -
Renewal Terms
Rate (per square foot per Monthly Base Rent
Installment Date annum) Installment
---------------- ------ -----------
October 1, 2000 and the first $20.50 $259,873.38
day of each month thereafter
through and including December
31, 2002
January 1, 2003 and the first $16.75 $212,335.56
day of each month thereafter
through and including December
31, 2007
January 1, 2008 and the first 95% of Fair Market Rental 95% of Fair Market Rental
day of each month thereafter Value (as defined in Section 7 Value of the Premises divided
through and including the of the Lease) by 12.
sixtieth (60th) month of such
Renewal Term
The first day of the first 95% of Fair Market Rental 95% of Fair Market Rental
month of the second sixty (60) Value (as defined in Section 7 Value of the Premises divided
month Renewal Term and the of the Lease) by 12.
first day of each month
thereafter through and
including the sixtieth (60th)
month of such Renewal Term.
Exhibit C
Tenant Improvement Projects
INTERIOR:
o Recarpet the Premises using Miliken Carpet 18 x 18 modular, P/8466
Colorweave, color D-174826-01
o Replace cove for the Premises using Xxxxx, #00 black, 4 inch
o Retofit interior lighting for the Premises using T-8 bulbs and energy
efficient ballasts
o Repaint the Premises
o Replace ceiling tiles on the first floor and on portions of the second
floor (excluding portions of the second floor that Tenant is reoccupying)
EXTERIOR:
o Replace all broken and damaged concrete, curb and gutter areas in the
parking lot. The cost of this item is a capital cost not to be included as
a cost or expense for the purposes of Section 5d. of the Lease.
