OFFICE LEASE
BY AND BETWEEN
RIVERSIDE RESOURCES INVESTMENTS, LTD.
AND
XXXXXX'X, INC.
OFFICE LEASE
BY AND BETWEEN
RIVERSIDE RESOURCES INVESTMENTS, LTD
AND
XXXXXX'X, INC.
INDEX
PAGE
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ARTICLE I. PRINCIPAL LEASE PROVISIONS 6
1.1 PROJECT 6
1.2 BUILDING 6
1.3 PREMISES 6
1.4 SUITE NUMBER 6
1.5 FLOOR NUMBER 6
1.6 AREA OF PREMISES 6
1.7 RENT SCHEDULE 6
1.8 TENANT'S PERCENTAGE OF PROJECT 6
1.9 LEASE TERM 7
1.10 COMMENCEMENT DATE 7
1.11 EXPIRATION DATE 7
1.12 SECURITY DEPOSIT 7
1.13 PARKING 7
1.14 USE OF PREMISES 7
1.15 TENANT'S BROKER 7
1.16 TENANT IMPROVEMENTS 7
1.17 PRORATIONS OR EXPENSE STOP 7
1.18 LATE CHARGE 7
1.19 LANDLORD'S ADDRESS 7
1.20 TENANT'S ADDRESS 7
ARTICLE II. PREMISES 8
2.1 PREMISES 8
2.2 PARKING 8
ARTICLE III. TERMS AND POSSESSION 8
3.1 TERM 8
3.2 TIME FOR DELIVERY OF POSSESSION 9
3.3 TENANT'S FAILURE TO CONDUCT BUSINESS 9
3.4 ACCEPTANCE OF PREMISES 9
3.5 QUIET ENJOYMENT 9
2
3.6 SECURITY DEPOSIT 10
ARTICLE IV. RENT 10
4.1 MONTHLY RENT 10
4.2 ADDITIONAL RENT 10
4.3 EFFECT OF TENANT BANKRUPTCY 10
ARTICLE V. DIRECT EXPENSES 11
ARTICLE VI. SERVICES AND UTILITIES 11
6.1 SERVICES PROVIDED BY LANDLORD 11
6.2 CHARGE FOR EXCESS SERVICES 12
6.3 INTERRUPTION OF SERVICE 13
6.4 MODIFICATION OF SERVICE 13
ARTICLE VII. USE AND OCCUPANCY 13
7.1 USE AND OCCUPANCY 13
7.2 RULES AND REGULATIONS 14
ARTICLE VIII. MAINTENANCE, REPAIRS AND ALTERATIONS 14
8.1 TENANT MAINTENANCE AND REPAIRS 14
8.2 LANDLORD MAINTENANCE AND REPAIRS 14
8.3 ALTERATIONS 15
ARTICLE IX. LIENS 15
ARTICLE X. INDEMNIFICATION 16
10.1 LIMITATION ON LANDLORD'S LIABILITY 16
10.2 TENANT'S INDEMNIFICATION OF LANDLORD 16
10.3 MUTUAL INDEMNIFICATION 16
10.4 SECURITY OF PROJECT 16
ARTICLE XI. INSURANCE 17
11.1 INSURANCE CARRIED BY LANDLORD 17
11.2 INSURANCE CARRIED BY TENANT 17
11.3 INSURANCE POLICIES 18
11.4 BLANKET INSURANCE 18
11.5 WAIVER OF SUBROGATION 19
11.6 TENANT'S FAILURE TO CARRY INSURANCE 19
11.7 EFFECT OF TERMINATION OF LEASE 19
ARTICLE XII. DAMAGE TO TENANT'S PROPERTY 19
ARTICLE XIII. DAMAGE AND DESTRUCTION 20
13.1 DAMAGE TO THE PREMISES 20
3
13.2 DAMAGE TO THE PROJECT 20
13.3 DAMAGE NEAR END OF TERM 20
13.4 REPAIR OF DAMAGE; RENT ABATEMENT 21
ARTICLE XIV. EMINENT DOMAIN 21
14.1 EFFECT ON LEASE 21
14.2 AWARD 22
14.3 REBUILDING 22
ARTICLE XV. ASSIGNMENT, SUBLETTING, HYPOTHECATION 22
15.1 LIMITATION OF TENANT'S RIGHTS TO ASSIGN, SUBLET OR HYPOTHECATE 22
15.2 NOTICE REQUIRED 23
15.3 TENANT'S LIABILITY 24
15.4 FORM REQUIRED 24
ARTICLE XVI. TENANT'S BREACH; LANDLORD'S LIEN; LANDLORD'S REMEDIES
16.1 TENANT'S BREACH 24
16.2 LANDLORD'S REMEDIES 25
16.3 RIGHT TO CURE TENANT'S DEFAULT 28
16.4 RIGHT TO RENTS, ISSUES AND PROFITS 28
16.5 LATE CHARGE 28
16.6 CUMULATIVE REMEDIES 29
ARTICLE XVII. LANDLORD'S DEFAULT; TENANT REMEDIES 29
17.1 LANDLORD'S DEFAULT 29
17.2 TENANT'S REMEDIES 29
ARTICLE XVIII. MORTGAGE OF LANDLORD'S INTEREST 30
18.1 SUBORDINATION OF TENANT'S RIGHTS 30
18.2 TENANT'S OBLIGATIONS WITH RESPECT TO LANDLORD'S MORTGAGE 30
18.3 ATTORNMENT 30
ARTICLE XIX. LANDLORD'S ACCESS 31
ARTICLE XX. INTENTIONALLY DELETED 31
ARTICLE XXI. BANKRUPTCY 31
21.1 EFFECT OF TENANT BANKRUPTCY 31
21.2 EFFECT OF LEASE ASSIGNMENT 32
ARTICLE XXII. SIGNS, DISPLAYS AND ADVERTISING 33
22.1 SIGNS 33
22.2 DISPLAYS 33
22.3 MAINTENANCE OF SIGNS 33
4
22.4 ADVERTISED NAME 33
ARTICLE XXIII. GENERAL PROVISIONS 33
23.1 ESTOPPEL CERTIFICATE 33
23.2 WAIVER 34
23.3 SURRENDER OF PREMISES; HOLDOVER TENANCY 34
23.4 NOTICES 35
23.5 PARTIAL INVALIDITY; SEVERABILITY; CONSTRUCTION 35
23.6 CORPORATE RESOLUTION 35
23.7 LIMITED PARTNERSHIP 35
23.8 CAPTIONS 35
23.9 SHORT FORM LEASE 35
23.10 BROKER'S COMMISSIONS 35
23.11 ATTORNEYS' FEES 36
23.12 COUNTERPARTS 36
23.13 SOLE AGREEMENT 36
23.14 SUCCESSORS AND ASSIGNS 36
23.15 LICENSEES; CONCESSIONAIRES 36
23.16 NO MERGER 36
23.17 MODIFICATION FOR LENDER 37
23.18 COMPLIANCE WITH LAW 37
23.19 JOINT AND SEVERAL OBLIGATIONS 37
23.20 LIGHT, AIR, VIEW 37
23.21 NO OFFER 37
23.22 LEGAL TENDER 37
23.23 CONFLICT OF LAWS; VENUE 38
23.24 INDEMNIFICATION 38
23.25 TIME IS OF THE ESSENCE 38
23.26 NO THIRD PARTY BENEFICIARIES 38
23.27 NONDISCLOSURE OF LEASE TERMS 38
23.28 GRAMMATICAL CONSTRUCTION 38
23.29 EXHIBITS 38
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OFFICE LEASE
This office Lease ("Lease") dated June 19, 2000, is made and entered
into by and between Riverside Resources Investments, LTD, a Texas limited
partnership ("Landlord") and Xxxxxx'x, Inc., a Delaware Corporation
("Tenant").
ARTICLE I.
PRINCIPAL LEASE PROVISIONS
This Article sets forth certain basic terms of this Lease; however, the
other Articles of this Lease contain a considerable number of adjustments and
exceptions, which qualify the provisions of this Article.
1.1 PROJECT. Two buildings, all parking areas, and all other improvements
currently located or subsequently placed or constructed thereon the proposed Xxx
0 xx xxx XxxxxxXxxxx Xxxxxxxxxxx, Xxxxxx Xxxxxx, Xxxxx (collectively, the
"Project"). The name of the Project is "Hoover's Center" and its local address
is 0000 Xxxxxxx Xxxx., Xxxxxx, Xxxxx .
1.2 BUILDING. The Project includes two (2) buildings (the "Buildings").
1.3 PREMISES. The office space being leased to Tenant hereunder is
referred to herein as the "Premises." The location of the Premises in the
Buildings is shown on the floor plan attached as EXHIBIT A.
1.4 SUITE NUMBER. Building A Suite 100/Building B Suite 200
1.5 FLOOR NUMBER. 1
1.6 AREA OF PREMISES. Approximately 77,735 square feet on floor one net
rentable area.
1.7 NET RENT SCHEDULE.
-----------------------------------------------------------------------------
NNN
Monthly Rate Total Square Total Monthly
per sq. ft. Footage Rent
-----------------------------------------------------------------------------
Month 1-6 13.50 59,439 66,869
-----------------------------------------------------------------------------
Month 7-12 13.50 68,596 77,171
-----------------------------------------------------------------------------
Year 2 13.75 77,735 89,071
-----------------------------------------------------------------------------
Year 3 14.00 77,735 90,691
-----------------------------------------------------------------------------
Year 4 14.25 77,735 92,310
-----------------------------------------------------------------------------
Year 5 14.50 77,735 93,930
-----------------------------------------------------------------------------
Year 6 14.75 77,735 95,549
-----------------------------------------------------------------------------
Year 7 15.00 77,735 97,169
-----------------------------------------------------------------------------
Year 8 15.25 77,735 98,788
-----------------------------------------------------------------------------
Year 9 15.50 77,735 100,408
-----------------------------------------------------------------------------
Year 10 15.75 77,735 102,027
-----------------------------------------------------------------------------
6
During months 1-12, Tenant shall pay rent on the greater of the square
footage occupied or the square footage noted above in Section 1.7. Landlord
retains the right to audit the space throughout Year One to verify Tenant's
square footage occupied. In the event Tenant elects to expand into space
greater than that noted above in Section 1.7, Tenant shall notify Landlord
and pay rent for the increased square footage upon occupancy; however, Tenant
is responsible for payment of rent for any increases in square footage
regardless of any failure by Tenant to provide notice.
1.8 TENANT'S PERCENTAGE OF PROJECT. (77,735/80,735) 96%
Building A 100% (75,735/75,735)
Building B 40% (2,000/5,000)
1.9 LEASE TERM. 120 months.
1.10 COMMENCEMENT DATE. May 1, 2001 or as soon thereafter as the Premises
are ready for occupancy as evidenced by approval of occupancy by the City of
Austin or other applicable regulatory authority.
1.11 EXPIRATION DATE. April 30, 2011.
1.12 SECURITY DEPOSIT. As set forth in Section 3.6.
1.13 PARKINGPARKING. As set forth in Exhibit B.
1.14 USE OF PREMISES. General Office and other office/light industrial uses
permitted by City of Austin.
1.15 TENANT'S BROKER. Xxxx Xxxxxxxxx, Office Leasing Advisors. Commission to
be paid per a separate commission agreement between Landlord and Broker.
1.16 TENANT IMPROVEMENTS. Set forth on EXHIBIT C.
1.1 7 EXPENSES. Rental amount stated in Section 1.7 is net of Direct
Expenses due to Landlord as set forth in Article V.
1.1 8 LATE CHARGE. Five percent (5%).
1.19 LANDLORD'S ADDRESS. c/o Riverside Resources Corporation
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
1.20 TENANT'S ADDRESS
PRIOR TO COMMENCEMENT:
0000 XXXXXXXX, XXXXX 000
XXXXXX, XXXXX 00000
ATTN: CHIEF FINANCIAL OFFICER
AFTER COMMENCEMENT:
0000 XXXXXXX XXXX.
XXXXXX, XXXXX
ATTN: CHIEF FINANCIAL OFFICER
7
EXHIBITS: (Line out if not attached)
A. Floor Plan of Premises/ Legal Description
B. Parking Areas
C. Tenant Improvements
D. Direct Expenses
E. Rules and Regulations
F. Guarantee of Lease
G. Prohibited Uses/Environmental Indemnity/Reporting obligations
H. Special Provisions
ARTICLE II.
PREMISES
2.1 PREMISES. Landlord hereby leases to Tenant and Tenant hires from Landlord
the Premises described in Section 1.1 through 1.6 inclusive.
2.2 PARKING. Landlord shall permit Tenant and its employees to park the
number of cars set forth in Section 1.13 in designated areas of the parking
area shown on EXHIBIT B.
ARTICLE III.
TERMS AND POSSESSION
3.1 TERM. The Term of this Lease shall be for the Term set forth in Section
1.9 herein (the "Term") commencing on the date set forth in Section 1.10
herein ("Commencement Date") and expiring on the date set forth in Section
1.11 herein ("Expiration Date"), unless sooner terminated pursuant to any
provision of this Lease. As used herein, the term "Lease Year" shall mean and
refer to each twelve (12) month period during the Term, commencing upon the
8
commencement of the Term, except that if the Term commences on other than the
first day of a calendar month, then the Term shall include those prorated
days in the initial month plus the next succeeding twelve (12) full months
which shall constitute the first Lease Year of the Term of this Lease. In the
event of conflict between 1.9 and 1.11, then 1.9 will control.
3.2 TIME FOR DELIVERY OF POSSESSION. Landlord shall deliver possession of the
Premises to Tenant on or before the Commencement Date. If Landlord, for any
reason including force majeure (as defined below) or Tenant Delay (as defined
in Exhibit C below), cannot deliver the Premises to Tenant on or before May
1, 2001, this Lease shall not be void or voidable. "Force Majeure" shall mean
any delay in performance of Landlord's obligations hereunder when Landlord is
prevented from doing so by cause or causes beyond Landlord's control which
shall include, without limitation, weather delays beyond normal climatic
conditions, all labor disputes, civil disturbance, war, war-like operations,
invasions, rebellion, hostilities, military or usurped power, sabotage,
governmental approvals, regulations or controls, fires or other casualty,
moratoriums or acts of God. In the event, however, Landlord cannot deliver
the Premises on or before May 1, 2001 for any reason excluding Force Majeure
and Tenant incurs and pays third party holdover charges, Landlord shall
reimburse Tenant for the direct holdover charges paid up to $17,500 per month.
3.3 TENANT'S FAILURE TO CONDUCT BUSINESS. In the event that Landlord notifies
Tenant that the Premises are ready for delivery and Tenant fails to take
possession and to open the Premises for business, then Tenant shall commence
paying Initial Monthly Rent as set forth in Section 1.7 and performing all
other obligations of Tenant hereunder on the Commencement Date.
3.4 ACCEPTANCE OF PREMISES. Tenant acknowledges neither Landlord nor any
agent of Landlord has made any representation or warranty concerning the
Premises or Project with respect to the suitability of either for the conduct
of Tenant's business. When Landlord considers the Premises to be
Substantially Complete (as defined below), it shall notify Tenant of same.
Within three (3) business days of receipt of Landlord's notice, Tenant and
Landlord shall make an inspection to determine whether the Premises are
Substantially Complete, which includes receipt of approval for occupancy by
the City of Austin. If Tenant's inspection discloses any item, excluding only
mechanical adjustments or minor details of construction or decoration which
do not unreasonably prevent Tenant from installing trade fixtures and
furnishings in the Premises and readying the Premises for the operation of
Tenant's business ("Punchlist Items"), which is not in accordance with the
Final working drawings as defined in Exhibit C, Landlord shall correct such
items before the Premises shall be deemed Substantially Complete
("Substantially Complete") and Tenant is required to accept the Premises. The
correction or completion of any Punchlist Items allowed under this Section
3.4 shall be completed by Landlord within thirty (30) days after Tenant's
inspection, or such longer time as may be necessary, provided Landlord has
commenced correction or completion of such items and is diligently pursuing
completion or correction.
3.5 QUIET ENJOYMENT. Upon Tenant paying the rent reserved hereunder and
observing the performance of all the covenants, conditions and provisions on
Tenant's part hereunder, Tenant
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shall have quiet enjoyment of the Premises for the entire Term hereof,
subject to all of the provisions of this Lease.
3.6 SECURITY DEPOSIT. Upon delivery to Landlord of a copy of this Lease
executed by Tenant, Tenant shall deliver to Landlord an irrevocable letter of
credit issued by a financial institution acceptable to Landlord ("the Letter
of Credit"). The Letter of Credit shall be in the amount of One million three
hundred seventy five thousand and 00/100 Dollars ($1,375,000.00). At such
time as Tenant is occupying and paying rent on 100% of the 77,735 square foot
Project and maintains a positive annual net income, the Letter of Credit
shall be reduced to $1,000,000 ("Initial Reduction"). For the purposes of
this Section 3.6, "net income" shall refer to Tenant's net income prior to
inclusion of any income or loss from extraordinary items and prior to
deduction for (i) amortization of non-cash compensation; (ii) depreciation or
amortization of any leasehold improvements related to the Project; and (iii)
amortization of goodwill and other intangibles. Additionally, said amount may
be reduced over the Term of the Lease following the Initial Reduction in the
following amounts so long as Tenant is not in breach of this Lease, after
notice and opportunity to cure pursuant to Section 16.1, and maintains a
positive annual net income:
Year Two $100,000 reduction at end of year
Year Three $100,000 reduction at end of year
Year Four $100,000 reduction at end of year
Year Five $100,000 reduction at end of year
Year Six $100,000 reduction at end of year
Year Seven $100,000 reduction at end of year
Year Eight $100,000 reduction at end of year
Year Nine $100,000 reduction at end of year
Year Ten $100,000 reduction at end of year
Notwithstanding the foregoing, provided that Tenant is not in breach of the
Lease after notice and opportunity to cure pursuant to Section 16.1, in the
event Tenant obtains a Rating ("Rating" as defined below) of BBB ("Investment
Grade") the entire Letter of Credit shall be released. So long as Tenant is
not in breach of the Lease after notice and opportunity to cure pursuant to
Section 16.1, Tenant is occupying and paying rent on the full Project and
Tenant has maintained a positive annual net income, Landlord agrees that in
the event Landlord seeks to refinance the Project, Landlord shall use best
efforts to obtain Lender approval for a reduction in the Letter of Credit in
an amount in excess of the amount stipulated in Section 3.6 and that is
consistent with market standards for companies comparable to Tenant, subject
to approval by Landlord's Board of Directors. Landlord agrees to provide
Tenant with reasonable notice prior to entering into any commitment to
refinance the Project. Notwithstanding Section 23.27 of the Lease, in
connection with such refinancing, Landlord agrees to not disclose the terms
of the Letter of Credit in the Lease to prospective lenders until such time
as the terms are specifically requested by Lender.
In the event that upon execution of this Lease, Landlord has not obtained
title to the Project, Tenant shall deliver the Letter of Credit to Heritage
Title, 00 Xxx Xxxxxxx, Xxxxx 000, Xxxxxx,
00
Xxxxx 00000, Attn: Xxxxx Xxxx (the "Escrow Agent") who shall hold the
instrument in escrow until the satisfaction of Exhibit H, Section 5. Upon
delivery of the Letter of Credit, Landlord shall also deliver the actual
Letter of Credit fee, up to a maximum of $13,000 ("Fee") to the Escrow Agent
who shall hold the instrument in escrow until the satisfaction of Exhibit H,
Section 5. Upon Landlord's presentation to the Escrow Agent of notice of
either title to the Property or authority to fulfill Landlord's obligations,
the Escrow Agent shall release the Letter of Credit and the Fee to Landlord.
In the event that Landlord fails to present notice of either title to the
Property or authority to fulfill Landlord's obligations prior to the deadline
specified in Exhibit H, Section 5, and the Lease is terminated per Exhibit H
Section 5. Escrow Agent will release the Letter of Credit and the Fee to
Tenant upon Tenant's request. Tenant shall use its best efforts to minimize
the costs of the Letter of Credit fee.
The Letter of Credit shall be for a minimum term of one year. In the event
the Letter of Credit term is less than ten years, the Letter of Credit shall
be automatically extended without amendment for an additional period of a
minimum of one year from the date of expiration unless at least thirty (30)
days prior to such date, the issuing bank provides written notification to
beneficiary ("Cancellation Notice"). In the event that the issuing bank
provides beneficiary with a Cancellation Notice, Tenant shall replace or
renew the Letter of Credit within ten (10) days of issuance of the
Cancellation Notice. Failure to renew or replace the Letter of Credit within
a ten (10) day period commencing on the issuance of the Cancellation Notice
shall be deemed a default per Article XVI of the Lease and provides
beneficiary with the right to draw on the Letter of Credit.
Subject to Tenant's notice and opportunity to cure provided in the Lease, if
Tenant defaults with respect to any provision of this Lease, Landlord may,
but shall not be required to use, apply or retain all or any part of this
Security Deposit for the payment of any rent or any other sum in default, or
for the payment of any other amount which Landlord may spend or become
obligated to spend by reason of Tenant's default, or to compensate Landlord
for any other loss or damage which Landlord may suffer by reason of Tenant's
default including Tenant Improvements and Brokerage Commissions. If any
portion of the Security Deposit is used or applied, Tenant shall, within ten
(10) days of written demand, deposit cash with Landlord in an amount
sufficient to restore the Security Deposit to the original amount and
Tenant's failure to do so shall be a material breach of this Lease. (Landlord
may, but is not required to keep this Security Deposit separate from its
general funds, and Tenant shall not be entitled to interest on such deposit.)
If Tenant shall fully perform all provisions and obligations under this
Lease, the Security Deposit or any balance thereof shall be returned to
Tenant (or at Landlord's option to the last assignee of Tenant's interest
hereunder) within ten (10) days after the Expiration Date, less any amount
required to restore the Premises to good condition and repair, normal wear
and tear excepted.
RATING
Landlord acknowledges that Tenant has the option to obtain a rating from
Standard & Poor's, Xxxxx'x (or a comparable service acceptable to Landlord
and Landlord's lender) that is issued in connection with the issuance of
public debt or issued independently of the issuance of public
11
debt, which is commonly referred to as a "Shadow Rating". Additionally,
Landlord acknowledges that the Rating may be issued based upon the
obligations associated with the Lease and Tenant's other current or projected
xxxxxxxxxxx.Xxxxxxxx Deposit
ARTICLE IV.
RENT
4.1 MONTHLY RENT. Tenant shall pay to Landlord the amount set forth in
Section 1.7 ("Initial Monthly Rent"), and pay any and all Additional Rent, in
advance on or before the first day of each calendar month during the Term,
without any deduction or offset and without prior notice or demand by
Landlord, as the monthly rent for the Premises ("Monthly Rent"). In the event
that Tenant fails to pay Monthly Rent within five (5) business days of the
due date, Tenant shall pay to Landlord a late charge as set forth in Section
16.5 below. The Monthly Rent for any fractional part of a month at the
beginning of the Term shall be prorated based on the actual number of days in
the month. Monthly Rent shall be adjusted annually, effective the first day
of each Lease Year following the first Lease Year, and shall be as set forth
in Exhibit D.
4.2 ADDITIONAL RENT. In addition to Monthly Rent, Tenant shall also pay, as
Additional Rent hereunder, Direct Expenses and all other charges, fees,
costs, taxes, impositions, expenses and other sums required to be paid by
Tenant to Landlord under the terms of this Lease whether or not the same
shall be designated as "Additional Rent." In the event of nonpayment of all
or any part thereof when due, Landlord shall have all of the rights and
remedies provided hereunder or by law or equity for the nonpayment of rent or
for the breach of a condition.
4.3 EFFECT OF TENANT BANKRUPTCY. Notwithstanding anything in this Lease to
the contrary, all amounts payable by Tenant to or on behalf of Landlord,
whether or not expressly denominated as rent, shall constitute rent for the
purposes of Section 502(b)(6) of the Bankruptcy Code.
ARTICLE V.
DIRECT EXPENSES
As set forth in Exhibit D, Tenant shall timely pay its proportionate
share of Direct Expenses and the payment of same shall be considered
Additional Rent due to Landlord hereunder.
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ARTICLE VI.
SERVICES AND UTILITIES
6.1 SERVICES PROVIDED BY LANDLORD. Provided that Tenant is not in default
hereunder, Landlord agrees to furnish or cause to be furnished to the
Premises, the utilities and services described below, subject to the Rules
and Regulations for the Project and conditions and standards set forth below
(subject to the last sentence of this Section 6.1):
(a) Landlord shall furnish to the Premises, subject to
interruptions beyond Landlord's control, electric current
as required by standard office lighting and receptacles up
to 6.5 xxxxx per square foot, net of HVAC load. At all
times, Tenant's use of electric current shall never exceed
the capacity of the feeders to the premises or the risers
or wiring installation. Tenant shall not install or use or
permit the installation or use of any computer or
electronic data processing equipment except personal
computers, network servers, telecommunication equipment and
other associated equipment necessary to conduct Tenant's
business in the Premises without the prior written consent
of Landlord which shall not be unreasonably withheld,
conditioned or delayed.
(b) Landlord shall furnish water only for drinking, lavatory,
wastewater and kitchen purposes.
(c) Landlord shall provide reasonable janitorial services to the
Premises up to six (6) days per week except on Project
holidays, provided that Tenant shall maintain the offices in a
manner consistent with Class A office space in North Central
Austin. Said services shall be performed by persons approved
by Landlord and Tenant and no one other than persons approved
by Landlord and Tenant shall be permitted to enter the
Premises for such purposes.
Landlord shall provide the management of services including
trash removal, striping, maintenance of drainage features,
landscaping, roof, hvac systems, janitorial and fire sprinkler
systems. Tenant and Landlord shall mutually approve selection
of vendors for services for which Tenant is responsible for
payment as part of Direct Expenses,.
All expenses associated with such utilities for the Project
outlined in paragraphs (a) and (b) above shall be the
responsibility of Tenant and paid directly by Tenant to the
utility providers. Any such services and utilities not paid by
Tenant directly shall be included in as part of the Direct
Expenses charged to Tenant hereunder.
6.2 CHARGE FOR EXCESS SERVICES. Tenant will either have a separate meter and
pay utilities directly to the utility provider or have a submeter and pay
Landlord for pro rata usage. Tenant shall pay for any services required to be
provided by Landlord for the use of the Premises which exceed the level of
utilities and services furnished for the use of the Premises for their
original intended purpose, or special electrical, cooling and ventilating
needs created in certain areas by telephone equipment, computers and other
similar equipment or uses. Tenant shall, within ten (10) days after receipt
of an invoice from Landlord, pay Landlord for the utilities at the then
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current rate charged by the applicable City of Austin utility service or
department. Tenant agrees to cooperate fully at all times with Landlord and
to abide by all regulations and requirements which Landlord may prescribe for
the use of the above facilities and services. Any failure to pay any excess
costs as described above shall constitute a breach of the covenant to pay
rent under this Lease and shall entitle Landlord rights herein granted for
such breach.
6.3 INTERRUPTION OF SERVICE. Landlord shall not be liable for Landlord's
failure to furnish any of the foregoing when such failure is caused by
accident, breakage, repairs, strikes, lockouts or other labor disputes of any
character, governmental regulation, moratorium or other governmental action,
inability by exercise of reasonable diligence to obtain electricity, water or
fuel, or by any other cause beyond Landlord's reasonable control, nor shall
any such failure, stoppage or interruption of any such service be construed
either as an eviction of Tenant, or relieve Tenant from the obligation to
perform any covenant or agreement or entitle Tenant to any abatement or
reduction of rent, except an equitable adjustment in rent if such
interruption continues for greater than five (5) business days (excluding
Saturdays, Sundays, and project holidays) and renders the premises unsuitable
for its intended use.
6.4 MODIFICATION OF SERVICE. Notwithstanding anything herein to the contrary,
Landlord reserves the right from time to time to make reasonable and
nondiscriminatory modifications to the standards for utilities and services
as set forth in this Article VI, provided the same does not interfere with
Tenant's use of the Premises as outlined in Section 1.14.
ARTICLE VII.
USE AND OCCUPANCY
7.1 USE AND OCCUPANCY. Tenant shall use and occupy the Premises for general
office and other uses consistent with office/light industrial purposes as
described in Section 1.14 and for no other purpose. Tenant shall not do or
permit anything to be done in or about the Premises nor bring or keep
anything therein which will in any way increase the existing insurance
premium rate or affect any fire or other type of insurance coverage upon the
Project or any of its contents, or cause cancellation of any insurance policy
covering said Project or any part thereof or any of its contents. In the
event Tenant's permitted use of the Premises results in an insurance rate
increase for the Premises or the Project of which the Premises are a part,
such insurance rate increase shall be charged to and payable by Tenant
monthly as Additional Rent during the Term.
7.2 RULES AND REGULATIONS. Tenant and its employees, agents, and visitors
shall comply with the Rules and Regulations attached hereto as EXHIBIT E and
made a part hereof, and such other and further reasonable rules and
regulations as Landlord may from time to time adopt. Landlord shall not be
liable to Tenant for any violation of the Rules and Regulations or any breach
of any lease provision by any other tenant or other party in the Project.
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ARTICLE VIII.
MAINTENANCE, REPAIRS AND ALTERATIONS
8.1 TENANT MAINTENANCE AND REPAIRS. During the Term hereof Tenant shall, at
Tenant's sole cost and expense, keep the Premises and fixtures therein in
good condition and repair in a quality and class consistent with Class A
office/ warehouse Office Buildings in North Central Austin, the obligations
of Landlord herein and ordinary wear and tear excepted. Without in any way
limiting the foregoing, in the event that Tenant fails to maintain the
Premises in accordance with the standards set forth in this Article VIII
(which shall include, but is not limited to the repair or maintenance
required by any laws, ordinances, governmental authorities or insurance
carriers) within three (3) days after written notice is provided by Landlord,
Landlord may enter the Premises and cause any such maintenance or repairs to
be performed at Tenant's expense. Tenant agrees to reimburse Landlord on
demand for all reasonable costs incurred by Landlord, and Landlord shall not
be liable for any loss or damage to Tenant caused by such maintenance or
repair except as set forth in this Lease. Except as set forth elsewhere
herein, Landlord shall have no obligation to alter, remodel, improve, repair,
decorate or paint the Premises or any part thereof. Upon surrender of the
Premises to Landlord, Tenant shall deliver the Premises to Landlord in as
good order, condition and repair as they are on the Commencement Date,
ordinary and reasonable wear excepted.
8.2 LANDLORD MAINTENANCE AND REPAIRS. Landlord shall repair and maintain the
structural portions of the Project, including roof, HVAC equipment, windows,
walls, parking, landscaping, basic plumbing and electrical systems (the cost
of the same to be included in Direct Expenses, to the extent set forth in
Exhibit D), unless such maintenance and repairs are caused in part or in
whole by the act, neglect, fault of or omission of any duty by Tenant, its
agents, employees or invitees, in which case Tenant shall pay to Landlord,
upon receipt of written notice, the reasonable costs of such maintenance and
repairs. Landlord shall provide reasonable notice of its intent to commence
maintenance and repairs as result of the act, neglect, fault of or omissions
of any duty by Tenant, its agents, employees or invitees. Landlord shall not
be liable for any failure to repair or maintain the Premises or Project
unless such failure persists for an unreasonable time after written notice by
Tenant without good faith efforts on the part of Landlord to repair. Tenant
waives any rights to make repairs at Landlord's expense under any law statute
or ordinance now or hereafter in effect. Except as set forth in Exhibit H,
there shall be no abatement of rent and no liability to or interference with
Tenant's business caused by Landlord's maintenance or repair of the Premises
or Project, provided Landlord has acted in a commercially reasonable manner
consistent with other building operators in the Suburban Austin market.
8.3 ALTERATIONS. Tenant shall not make or permit any alterations, additions,
or improvements to be made to the Premises in excess of $25,000, provided
Tenant complies with all applicable laws, codes, regulations and implements
sound construction practices, without first obtaining Landlord's prior
written consent which consent shall not be unreasonably withheld, or delayed.
If Landlord consents to the making of any such alterations, additions or
improvements to the Premises by Tenant, the same shall be made by Tenant at
Tenant's sole cost and expense and any contractor or person selected by
Tenant to make same must be previously approved in writing by Landlord, which
approval will not be unreasonably withheld or conditioned. Tenant agrees to
give Landlord written notice of the commencement date of any alterations,
additions or
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improvements to be made not later than fifteen (15) days prior to the
commencement of any such work, in order to give Landlord time to post an
appropriate notice of non-responsibility. All such alterations, additions or
improvements shall immediately become part of the realty and belong to
Landlord and shall be surrendered with the Premises at the end of the Term.
Any alterations, additions or improvements shall be approved by all
appropriate government agencies and all applicable permits and authorizations
shall be obtained at Tenant's sole cost and expense before commencement of
the alterations, additions or improvements. All alterations, additions and
improvements shall be completed with due diligence and in compliance with the
plans and specifications and working drawings which shall have been approved
by Landlord prior to the commencement of work.
ARTICLE IX.
LIENS
Tenant shall keep the Premises and the Project free from any liens
arising out of work performed, materials furnished, or obligations incurred
by Tenant and shall indemnify, hold harmless and defend Landlord from any
liens and encumbrances arising out of any work performed or materials
furnished by or at the discretion of Tenant, including the costs of
reasonable attorneys' fees. This obligation to indemnify, hold harmless and
defend shall survive termination of this Lease. Tenant shall cause any
mechanic's lien or other liens filed against the Premises or Project to be
released and removed within ten (10) days of such filing either by
satisfaction of such lien or by the posting of a bond. Failure by Tenant to
comply with this provision within ten (10) days after notice from Landlord
shall constitute a material breach of this Lease.
ARTICLE X.
INDEMNIFICATION
10.1 LIMITATION ON LANDLORD'S LIABILITY. With the exception of Landlord's
negligence, or willful misconduct, or as relates to Landlord's
indemnification under Section 10.3 or the allocation of insurance proceeds
under Section 11, the Landlord shall in no event be liable for any damage or
destruction to any property or injury or death to any person happening on, in
or about the Premises during the entire Term of this Lease from any cause
whatsoever, including without limitation, any act or negligence of other
tenants or other parties, gas, fire, oil, electricity, leakage of any
character from the roof, walls, basement or other portion of the Premises or
Project of which the Premises are a part. Tenant, as a material part of the
consideration to Landlord, hereby assumes all risk of such damage or
destruction, and expressly waives all claims with respect thereof as against
Landlord. This limitation and release shall survive the termination of this
Lease.
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10.2 TENANT'S INDEMNIFICATION OF LANDLORD. Tenant shall indemnify Landlord
and hold it harmless from and against any and all losses, liabilities,
judgments, costs or expenses (including reasonable attorneys' fees and other
costs of investigation and defense) which Landlord may suffer by reason of
any claim asserted by any person arising (or allegedly arising) out of (a)
the use or occupancy of the Premises by Tenant and/or any subtenants,
licensees and concessionaires; (b) any activity, work or other things done,
permitted or suffered by Tenant or such other persons in, upon or about the
Premises; or (c) any failure by Tenant to perform any obligation to be
performed by Tenant under the terms of this Lease; or (d) any act, omission,
negligence or misconduct of Tenant, its agents, employees, invitees or
customers. If any action or proceeding is brought against Landlord, Tenant,
upon Landlord's request, shall defend the same by counsel satisfactory to
Landlord, at Tenant's expense. This indemnification shall survive the
termination of this Lease.
10.3 MUTUAL INDEMNIFICATION. Tenant shall indemnify Landlord and hold it
harmless from and against any and all losses, liabilities, judgments, costs
or expenses (including reasonable attorneys' fees and other reasonable costs
of investigation and defense) which Landlord may suffer by reason of any
claim asserted by any person arising (or allegedly arising) out of any act,
omission, gross negligence or misconduct of Tenant, its agents, employees,
invitees or customers; provided, however, that Tenant's duty to indemnify and
defend Landlord shall not apply where Landlord's gross negligence or
intentional misconduct is a contributing cause to the claim or loss. Landlord
shall indemnify Tenant and hold it harmless from and against any and all
losses, liabilities, judgments, costs or expenses (including reasonable
attorneys' fees and other reasonable costs of investigation and defense)
which Tenant may suffer by reason of any claim asserted by any person arising
(or allegedly arising) out of any act, omission, gross negligence or
misconduct of Landlord, its agents, employees, invitees or customers;
provided, however, that Landlord's duty to indemnify and defend Tenant shall
not apply where Tenant's gross negligence or intentional misconduct is a
contributing cause to the claim or loss. The mutual obligations of Landlord
and Tenant to provide defense and indemnification shall survive the
termination of this Lease
10.4 SECURITY OF PROJECT. As set forth in Section 6.1, Landlord may provide,
from time to time, employ one or more persons to provide security for the
Project. Under no circumstances shall Landlord be liable to Tenant or to any
other person by reason of any theft, burglary, robbery, assault, trespass,
unauthorized entry, vandalism, or any other act of any third person occurring
in or about the Premises except to the extent the same results from any gross
negligence or willful misconduct on the part of Landlord, and Tenant shall
indemnify Landlord and hold it harmless from and against any and all losses,
liabilities, judgments, costs or expenses (including attorneys' fees and
other costs of investigation or defense) which Landlord may suffer by reason
of any claim asserted by Tenant's guests or invitees arising out of, or
related to, any of the foregoing.
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ARTICLE XI.
INSURANCE
11.1 INSURANCE CARRIED BY LANDLORD. The Landlord shall maintain, at
Landlord's expense (but subject to the last sentence of this Section 11.1), a
policy or policies of insurance protecting Landlord against the following:
(a) Fire and other perils normally included within the
classification of fire and all-risk (and sprinkler leakage,
if applicable) in an amount sufficient to cover the full
replacement cost of the Project, exclusive of trade fixtures
and equipment belonging to Tenant.
(b) Public Liability and Property Damage insurance with respect to
the Project in amounts determined by Landlord from time to
time so long as such amounts are comparable to those for
similar office/light industrial projects in North Austin. All
such bodily injury or property damage insurance shall insure
the performance by Landlord of the indemnity agreement as to
personal injury or property damage contained in Section 10.3
above.
(c) Rent loss insurance in an amount equal to at least one hundred
percent (100%) of the annual rentals receivable from Tenant.
The foregoing limits may be increased from time to time as required by the
holder of any first mortgage or first deed of trust, or in Landlord's
discretion on the advice of its insurance consultant. In the event that the
Landlord's insurance premiums increase by more than 10%, Landlord shall
obtain at least two competitive bids from acceptable carriers meeting the
standards set forth in the Lease for comparable coverage in the Project.
It is understood that Landlord will acquire policies or a master
policy for the Project complying with the requirements of Section 11.1(a).
All such insurance shall be included as part of the Direct Expenses charged
to Tenant hereunder.
11.2 INSURANCE CARRIED BY TENANT. Tenant shall maintain in force a policy or
policies of insurance protecting Landlord and Tenant, as follows:
(a) Public liability and property damage insurance with respect to
the Premises insuring Tenant and naming Landlord as an
additional insured, against personal injury or death and
property damage in an amount not less than One Million
Dollars ($1,000,000) combined single limit liability for
injury or death to one or more persons in any one
occurrence and damage to property. The amounts of such
public liability insurance shall be increased from time to
time as Landlord may reasonably determine so long as
increases are comparable to those for similar
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office projects in North Austin. All such bodily injury
or property damage insurance shall specifically insure the
performance by Tenant of the indemnity agreement as to
personal injury or property damage contained in Section
10.2 above, including any injury claim or potential
liability to Tenant's own employees.
(b) Insurance covering alterations, additions or improvements
permitted under Article VIII above, trade fixtures and
personal property from time to time during the Term of this
Lease, providing protection against any peril included within
the classification "fire and extended coverage," together with
insurance against vandalism and malicious mischief. Except for
Tenant's property, any policy proceeds shall be used for the
repair or replacement of the property damaged or destroyed
unless this Lease shall terminate pursuant to Article XIII
below.
11.3 INSURANCE POLICIES. All policies of insurance to be provided by Tenant
shall be issued by insurance companies with general policy holder's rating of
not less than "A-" and a financial rating of not less than Class XII as rated
in the most current "Bests" Insurance Reports, and qualified to do business
in the state in which the Project is located. Such policies shall be issued
in the names of Tenant with Landlord as an additional named insured. The
policies provided by Tenant shall be for the mutual and joint benefit and
protection of Landlord and Tenant and Mortgagee (if required) by Mortgagee)
and executed copies of such policies of insurance or certificates thereof
shall be delivered to Landlord within ten (10) days after delivery of
possession of the Premises to Tenant and thereafter at least thirty (30) days
prior to the termination or expiration of the Term of each existing policy.
All public liability and property damage policies shall contain a provision
that Landlord, although named as an additional insured, shall nevertheless be
entitled to recover under said policies for any loss occasioned to it, its
agents, employees, and invitees by reason of the negligence of Tenant, its
officers, agents and employees. Further, such policies shall be written as
primary policies, not contributing with and not in excess of coverage, which
Landlord may carry. Upon the expiration or termination of any policies,
renewal or additional policies shall be procured and maintained by Tenant to
provide the required coverage. All policies of insurance delivered to
Landlord must contain a provision that the company writing said policy will
provide to Landlord twenty (20) days written notice in advance of any
cancellation or lapse of the effective date or any reduction in the amounts
of insurance.
11.4 BLANKET INSURANCE. Notwithstanding anything herein to the contrary,
Tenant's obligation to carry the insurance described in this Article XI may
be brought within the coverage of a so-called blanket policy or policies of
insurance carried and maintained by Tenant, provided that (a) Landlord, and
Mortgagee if required by Mortgagee), shall be named as additional insureds
thereunder, as their interests may appear, (b) the coverage afforded Landlord
will not be reduced or diminished by reason of the use of such blanket policy
of insurance, and (c) the requirements set forth herein are otherwise
satisfied. Tenant agrees to permit Landlord at all reasonable times to
inspect the policies of insurance of Tenant covering the Premises if such
policies are not required to be delivered to Landlord.
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11.5 WAIVER OF SUBROGATION. Landlord and Tenant hereby mutually release each
other from liability and waive all right to recover against each other for
any loss from perils insured against under their respective fire insurance
policies, including any extended coverage and special form endorsements to
said policies; provided, however, this Section 11.5 shall be inapplicable if
it would have the effect, but only to the extent that it would have the
effect, of invalidating any insurance coverage of Landlord or Tenant
providing that notice of same has been provided by each party to the other.
The parties shall obtain, if available, from their respective insurance
companies, a waiver of any right of subrogation, which said insurance company
may have against Landlord or Tenant, as the case may be.
11.6 TENANT'S FAILURE TO CARRY INSURANCE. If Tenant should fail either to
acquire the insurance required pursuant to this Article XI and to pay the
premiums therefore or to deliver required policies or certificates as
required by Landlord hereunder, Landlord may acquire such insurance and pay
the requisite premiums therefor, which premiums shall be payable by Tenant to
Landlord immediately upon demand.
11.7 EFFECT OF TERMINATION OF LEASE. In the event that this Lease is
terminated by reason of damage and destruction and Tenant is thus relieved of
its obligation to restore or rebuild the improvements on the Premises, any
insurance proceeds for damage to the Premises, including all fixtures and
leasehold improvements thereon, shall belong to Landlord, free and clear of
any claims by Tenant.
ARTICLE XII.
DAMAGE TO TENANT'S PROPERTY
Landlord and/or its employees and agents shall not be liable for any
damage to property entrusted to Landlord and/or its employees and agents nor
for loss or damage to any property by theft or otherwise, nor for any injury
or damage to persons or property resulting from fire, explosion, falling
building materials, including but not limited to concrete, insulation, duct
work, ceiling tiles, lighting fixtures, lenses or lamps, and wallboard or
other wall coverings, steam, gas, electricity, water or rain, which may leak
from any part of the Project, or from the pipes, appliances or plumbing works
therein, or from the roof, street or subsurface, or from any other place or
resulting from dampness or any other cause whatsoever except to the extent of
the negligence or willful misconduct of Landlord. Landlord and its employees
and agents shall not be liable for interference with the light or other
incorporeal hereditaments. Tenant shall give prompt notice to Landlord in
case of fire or accidents in the Premises or in the Project or of defects
therein or in the fixtures or equipment.
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ARTICLE XIII.
DAMAGE AND DESTRUCTION
13.1 DAMAGE TO THE PREMISES. If the Premises should be damaged or destroyed
during the Term hereof by the peril insured under fire and extended coverage
insurance policies referenced in this Lease, Landlord shall (except as
hereafter provided) repair or rebuild the Premises to substantially the
condition in which the Premises were immediately prior to such destruction
and this Lease shall continue in full force and effect. In the event that (a)
the Premises are damaged as a result of any cause other than peril covered by
Landlord's insurance or (b) the Premises are damaged as a result of fire or
other peril covered by Landlord's insurance, but the cost to repair such
damage shall exceed available insurance proceeds, or Landlord's lender does
not allow Landlord to utilize sufficient insurance proceeds to repair the
damage, Landlord may, at its option, either repair such damage as soon as
reasonably practicable at Landlord's expense (but in no event later than 180
days following the date of the occurence), in which event this Lease shall
continue in full force and effect, or give written notice to Tenant within
thirty (30) days after the occurrence of the damage of Landlord's intention
to cancel and terminate this Lease as of the date of the occurrence of such
damage. Notwithstanding anything to the contrary herein, Tenant shall be
responsible for and shall pay to Landlord the reasonable cost of repair of
any damage or destruction of the Premises caused by the negligence or willful
misconduct of Tenant, its employees, agents or invitees. Tenant's obligation
to pay for such repairs or restoration shall be reduced by any insurance
proceeds payable to Landlord, but only to the extent such insurance provides
for a waiver of subrogation which permits such a reduction of Tenant's
obligations. Tenant shall vacate such portion of the Premises as Landlord
reasonably requires to enable Landlord to repair the Premises.
13.2 DAMAGE TO THE PROJECT. In the event that the Project of which the
Premises are a part shall be damaged or destroyed to the extent of
thirty-three percent (33 %) or more of the then full replacement cost
thereof, whether or not the Premises are damaged or destroyed, and provided
that any insurance proceeds associated with such damage or destruction are
insufficient to restore such damage or destruction or that Landlord's lender
does not allow Landlord to utilize sufficient insurance proceeds to repair
such damage or destruction, and Tenant has elected not to fund such deficit,
then Landlord may at Landlord's option cancel and terminate this Lease by
giving written notice to Tenant of Landlord's election to do so within thirty
(30) days after the date of occurrence of such damage, in which event this
Lease shall terminate on the date such notice is given. Landlord agrees that
if the Lease is not terminated, then with respect to the remainder of the
Project, Landlord will repair, rebuild or take the necessary steps so that
the same is returned to its condition as it existed prior to such damage.
13.3 DAMAGE NEAR END OF TERM. Notwithstanding anything to the contrary in
this Article XIII, if the Premises are damaged during the last year of the
Term hereof, and the cost to repair shall exceed the aggregate Monthly Rent
paid by Tenant for the three (3) calendar months immediately preceding the
month during which the damage occurred, Landlord may, at Landlord's option,
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cancel and terminate this Lease as of the date of occurrence of such damage
by giving written notice to Tenant of Landlord's election to do so within
thirty (30) days after the date of occurrence of such damage unless Tenant
extends the Term of the Lease as provided herein.
13.4 REPAIR OF DAMAGE; RENT ABATEMENT. If this Lease is terminated pursuant
to any of the provisions of this Article XIII, the Monthly Rent, Additional
Rent and other payments provided for herein shall be paid by Tenant through
the date of such termination, and an equitable adjustment shall be made
concerning advance rents and other payments made by Tenant to Landlord. If
this Lease is not so terminated, Landlord shall, as soon as reasonably
practicable (and subject to the requirements of any Landlord's mortgage
concerning the application of insurance proceeds), restore and repair the
Premises to the same condition, to the extent possible, they were in
immediately prior to the occurrence of the damage. Should such repairs to the
premises be estimated to take six (6) months or more from the occurrence of
the damage, Tenant shall have the right to terminate the Lease. During the
time when the Premises are under repair, the rent hereunder will be abated to
a fair and equitable extent, based upon the actual loss of use and enjoyment
experienced by Tenant. In addition, Landlord will assist Tenant in locating
temporary space. Landlord will not be liable for any moving expenses,
increased rental expenses or other costs, which may be incurred by Tenant.
Notwithstanding the foregoing, Tenant, at its own expense, shall promptly
repair or replace (a) any improvements, alterations, or additions made to the
Premises by or at the direction of Tenant or any subtenant, licensee or
concessionaire, (b) any fixtures, of Tenant, and (c) except for Tenant's
property, any other property covered by insurance carried (or required to be
carried) by Tenant and Landlord shall have no obligation to repair or restore
such items. No abatement, diminution or reduction of the Monthly Rent,
Additional Rents or other charges shall be granted to Tenant except as
provided in this Lease.
ARTICLE XIV.
EMINENT DOMAIN
14.1 EFFECT ON LEASE. If the Project or any portion thereof are taken or
damaged under the power of eminent domain or by inverse condemnation or for
any public or quasi-public use, (all of which are herein called
"condemnation") this Lease shall terminate as to the part so taken as of the
date the condemning authority takes title or possession, whichever first
occurs. If so much of the Project or any portion including parking is taken
by condemnation that the remainder is unsuitable for Tenant's continued
occupancy for the uses and purposes for which the Project is leased, then
Tenant shall have the option, exercisable only by written notice to Landlord
within thirty (30) days after the condemning authority takes such title or
possession, to terminate this Lease; provided, however, that if Landlord
disagrees with Tenant's determination that the portion of the Premises
remaining after condemnation is unsuitable for Tenant's occupancy, such
controversy shall be settled by arbitration in accordance with the commercial
arbitration rules of the American Arbitration Association then in effect. In
the event that less than all of the Project shall be taken by condemnation
and Tenant does not elect to terminate this Lease in accordance with the
foregoing, this Lease shall remain in full force and effect as to the portion
of the
22
Premises remaining, except that the Monthly Rent otherwise payable hereunder
shall be reduced in the same ratio that the floor area of the portion of the
Project taken by such condemnation bears to the floor area immediately before
such condemnation. Notwithstanding anything as to the contrary herein, in the
event that more than twenty-five percent (25%) of the leasable square footage
of the Project is taken by condemnation, whether or not any portion of the
Premises is taken, then Landlord may, at its option, to be exercised by
written notice to Tenant within sixty (60) days after the date the condemning
authority shall take title or possession, whichever occurs first, terminate
this Lease as of the date of the taking of such title or possession. Upon
termination, this Lease shall expire and all interests of Tenant in the
Project shall terminate, provided the Monthly Rent, Additional Rent and all
other sums due are paid in full up to and including the date of such
termination.
14.2 AWARD. Landlord shall be entitled to and shall receive the total amount
of any award, income or payment made with respect to taking by condemnation,
regardless of the basis of such award; provided, however, that Landlord shall
not be entitled to any award for (a) loss of or damage to Tenant's trade
fixtures and removable personal property, (b) damage for cessation or
interruption of Tenant's business, (c) the cost of removal or relocation of
Tenant's property or business or (d) any other similar claim which Tenant may
be empowered by law to make.
14.3 REBUILDING. In the event that this Lease is not terminated by reason of
such condemnation, Landlord shall, to the extent of the award received and
subject to the provisions of Landlord's mortgage concerning the application
of condemnation awards, cause such restoration and repair to the remainder of
the Premises and the Project of which they are a part, to be done as may be
necessary to restore them to a reasonably suitable condition for the conduct
of the business of Tenant and the other occupants of the remaining portion of
such Project.
ARTICLE XV.
ASSIGNMENT, SUBLETTING, HYPOTHECATION
15.1 LIMITATION OF TENANT'S RIGHTS TO ASSIGN, SUBLET OR HYPOTHECATE. Tenant
shall not assign this Lease or sublet the Premises, or any part thereof,
without Landlord's prior written consent, which shall not be unreasonably
withheld or delayed provided that Landlord determines in its reasonable
judgement that such assignment or sublease will not have an adverse effect on
the Project; provided, however, that notwithstanding, Landlord's consent to
any such assignment or sublease, Tenant shall remain primarily liable under
this Lease. Tenant shall be entitled to any profits associated with
subletting the Premises.
If Tenant desires at any time to assign this Lease or sublet all or
a part of the Premises, it shall first notify Landlord of its desire to do so
and shall submit IN WRITING to Landlord (1) the name of the proposed
assignee, (2) the nature of the proposed assignee's business to be carried on
in the Premises, (3) a copy of the proposed assignment and any other
applicable agreement, and (4) such financial or other information as Landlord
may reasonably request concerning the proposed assignee. Landlord agrees to
advise Tenant in writing within ten business (10) days as
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to whether or not a proposed assignee or sublease is acceptable, as set forth
in Section 15.2 below. In the event of assignment or subleasing that results
in Tenant occupying less than 50% of the Premises, Landlord retains the
right, but not the obligation to terminate this Lease on the portion of the
Premises to be assigned or subleased and deal directly with proposed
subtenant or assignee, (although Landlord's consent must still be obtained as
set forth above). Any attempted assignment, transfer, mortgage or other
encumbrance of Tenant's interest in this Lease of the Premises or subletting
or permissive use in occupancy of the Premises without Landlord's written
consent, shall be null and void and have no force and effect whatsoever and
shall constitute a breach of this Lease.
Notwithstanding anything in the Lease to the contrary, Landlord
hereby agrees that if Tenant desires to assign or sublet the Premises to its
parent, subsidiary, an affiliated corporation or to any other entity which is
directly or indirectly controlled by a parent, subsidiary or affiliated
corporation, or if Tenant desires to assign or sublet the Premises in
connection with a merger or consolidation of Tenant with another corporation,
or in connection with the sale of substantially all of Tenant's stock or
assets, the Landlord's consent to any such assignment or subletting shall not
be required.
15.2 NOTICE REQUIRED. After Tenant has: (i) notified Landlord of Tenant's
intent to assign, sublease, hypothecate, license, or otherwise encumber this
Lease, and (ii) provided to Landlord all of the information required under
Section 15.1 hereinabove, Landlord shall within thirty (30) days from receipt
of such notice and information (a) consent to such proposed assignment,
subletting, hypothecation, licensing or encumbrance; (b) refuse such consent;
or (c) terminate this Lease. In the event of Landlord's election to
terminate, Tenant shall have ten (10) days from receipt of such notice in
which to notify Landlord of Tenant's acceptance of such termination or
Tenant's desire to remain in possession of the Premises under the terms and
conditions and for the remainder of the Term hereof. In the event Tenant
notifies Landlord of Tenant's desire to remain in possession of the Premises
under the terms and conditions for the remainder of the Term hereof, Tenant
shall be entitled to remain in possession of the Premises under the terms and
conditions and for the remainder of the Term hereof. In the event Tenant
fails to notify Landlord of Tenant's election to accept termination or to
continue as Tenant hereunder, Landlord shall have the right to elect that
such failure is deemed a termination of this Lease.
15.3 TENANT'S LIABILITY. Regardless of Landlord's consent, no subletting,
assignment, hypothecation, license, concession or encumbrance shall release
Tenant from Tenant's obligation or alter the primary liability of Tenant to
pay the Monthly Rent, Additional Rent, and other payments provided for herein
and to perform all other obligations to be performed by Tenant hereunder. The
acceptance of rent by Landlord from any other person shall not be deemed a
waiver by Landlord of any provision hereof. Consent to one assignment,
subletting, hypothecation, license, concession or encumbrance shall not be
deemed consent to any subsequent assignment, subletting, hypothecation,
license, concession or encumbrance. In the event of default by any assignee
of Tenant or any successor of Tenant in the performance of any of the terms
hereof, Landlord may proceed directly against Tenant without the necessity of
exhausting remedies against such assignee or successor. Landlord may consent
to subsequent assignments, subletting, hypothecations, licenses, concessions
or encumbrances and to
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amendments or modifications to this Lease with assignees of Tenant without
notifying Tenant or any successor of Tenant, and without obtaining its or
their consent thereto and such action shall not relieve Tenant of liability
under this Lease.
15.4 FORM REQUIRED. Each transfer, assignment, subletting, hypothecation,
licensing, concession or encumbrance to which Landlord has consented shall be
evidenced by an instrument in form reasonably satisfactory to Landlord and
shall be executed by the transferor, assignor, sublessor, licensor,
concessionaire, hypothecator or mortgagee and the transferee, assignee,
sublessee, licensee, concessionaire, or mortgagor in each instance, as the
case may be; and each transferee, assignee or sublessee shall agree in
writing to assume, to be bound by, and to perform the terms, covenants and
conditions of this Lease to be done, kept and performed by Tenant. One
executed copy of such instrument shall be delivered to Landlord.
ARTICLE XVI.
TENANT'S BREACH; LANDLORD'S LIEN; LANDLORD'S REMEDIES
16.1 TENANT'S BREACH. The occurrence of any one of the following events shall
be considered a breach of this Lease by Tenant:
(a) Tenant shall (i) become bankrupt or insolvent, (ii) make a
fraudulent transfer, (iii) make an assignment for the benefit of
creditors, or (iv) take any action or have taken against Tenant any
proceedings of any kind under any provision of the Federal Bankruptcy
Act or under any other insolvency, bankruptcy or reorganization act
and, in the event any such proceedings are involuntary, Tenant is not
discharged or stayed from the same within thirty (30) days thereafter;
(b) A receiver is appointed for a substantial part of the assets of
Tenant;
(c) Tenant shall vacate or abandon the Premises (any absence by Tenant
from the Premises for fifteen (15) days or longer while in default of
any provision of this Lease shall be deemed abandonment and vacation);
(d) Tenant shall make any transfer of assets, dividend or distribution
which shall have a materially adverse impact on Tenant's ability to
perform its obligations under this Lease.
(e) Tenant shall fail to pay any of the rents when due hereunder or
fail to reimburse Landlord for expenditures made on behalf of Tenant by
Landlord pursuant to this Lease, which failure continues for (i) five
(5) business days after written notice thereof. Landlord shall not be
required to give such written notice more than three (3) times in any
twelve (12) consecutive month period);
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(f) This Lease or any estate of Tenant hereunder shall be levied upon
by any attachment or execution;
(g) Tenant shall fail to observe or perform any of its other covenants
or obligations hereunder including, without limitation, the rules and
regulations, which failure continues for thirty (30) days (or such
other time periods as herein specified) after written notice thereof by
Landlord to Tenant (provided that the aforesaid thirty (30) day period
may be extended in the event that Tenant commences curing such default
within such thirty (30) day period and continues the curing thereof
with due diligence);
16.2 LANDLORD'S REMEDIES. In the event of any breach of this Lease by Tenant,
Landlord, in addition to any other rights or remedies it may have at law, in
equity or otherwise, shall have the following rights:
(a) Landlord shall have the right of re-entry and may change the
locks on all doors and/or remove all persons and property from
the Premises subject to the provisions of subparagraphs (a)(i)
and (ii) below:
(i) Landlord may remove any and all personal property located
in the Premises and place such property in a public or private
warehouse at the sole cost and expense of Tenant and the
owner; any such warehouse shall have all rights and remedies
provided by law against Tenant as owner of such stored
personal property. In the event that Tenant shall not
immediately pay the cost of storage after the property has
been stored for thirty (30) days or more, Landlord may sell
any and all property thereof at a public or private sale in
such manner and at such times and places as Landlord in its
sole discretion may deem proper, without notice or demand on
Tenant.
(ii) Tenant waives all claims for damage that may be caused by
Landlord's removal and/or selling of such property and Tenant
shall indemnify Landlord from any and all losses, costs,
damages, including without limitation, reasonable attorneys',
fees of Landlord occasioned thereby. This Indemnity shall
survive the termination of this Lease.
(b) Should Landlord elect to re-enter, or should Landlord take
possession pursuant to any notice provided for by law,
Landlord may either terminate this Lease or it may, without
terminating this Lease, re-lease the Premises of any part
thereof, for its own account or for the account of Tenant, for
such term and upon such terms and conditions as Landlord in
its sole discretion may deem advisable, with the right to make
improvements, alterations and repairs to the Premises. Rentals
received by Landlord from such re-leasing may be applied:
first, to the payment of rent (including interest thereon) due
and unpaid hereunder; second, to the payment
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of any indebtedness (including interest thereon) other than
rent due hereunder from Tenant to Landlord; third, to the
payment of any cost of such re-leasing, including without
limitation attorneys' fees, advertising costs and brokers'
commissions; fourth, to the payment of future rents as the
same may become due and payable hereunder. Should such rentals
received from re-leasing during any month be less than that
amount due and payable by Tenant hereunder, then Tenant shall
also pay to Landlord, the amount of any such deficiency and as
soon as ascertained, the cost and expenses incurred by
Landlord in such re-leasing or in making such alterations and
repairs. No such re-entry or taking of 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
election is given to Tenant. Notwithstanding any such
re-leasing without termination, Landlord may at any time
thereafter elect to terminate this Lease for such previous
breach.
(c) Landlord shall have the right to terminate this Lease by
giving written notice of termination to Tenant, and until such
notice is given, even though Tenant has breached or defaulted
under this Lease and abandoned the Premises, this Lease shall
continue in effect and Landlord may enforce all of its rights
and remedies under this Lease, including but not limited to
the right to recover rental as it becomes due hereunder. No
act by Landlord other than giving express written notice to
Tenant shall terminate this Lease. Acts of maintenance,
efforts to re-lease any part of the Premises or any other
action taken to protect Landlord's interest under this Lease
shall not constitute a termination or waiver of Landlord's
remedies hereunder. Should Landlord at any time terminate this
Lease for any breach, in addition to any other remedy it may
have, it is hereby agreed by Landlord and Tenant that, at
Landlord's election, the damages Landlord shall be entitled to
recover shall include without limitation:
(i) The value at the time of the award for damages,
hereinafter referred to as "Award" (computed by discounting
such amount at the discount rate of the Federal Reserve Bank
of Dallas at the time of the Award plus one percent) of (a)
the unpaid rent earned at the time of termination, (b) the
amount by which the unpaid rent which would have been earned
during the period from the time of termination until the time
of the Award exceeds the amount of such rental loss that
Tenant proves could be reasonably avoided, and (c) the amount
by which the unpaid rent for the balance of the Term after the
time of the Award exceeds the amount of such rental loss that
Tenant proves could be reasonably avoided;
(ii) All reasonable legal expenses, including attorneys,
fees, and other related costs incurred by Landlord following
Tenant's default;
(iii) All reasonable costs incurred by Landlord in restoring
the
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Premises to good order and condition normal wear and tear
excepted, or inremodeling, renovating or otherwise preparing
the Premises for re-leasing;
(iv) All reasonable costs (including without limitation any
unamortized brokerage commissions for the remainder of the
Lease) incurred by Landlord in re-leasing the Premises; and
(v) At Landlord's election, such other amounts in addition
to or in lieu of the foregoing as may be permitted from time
to time by applicable state law.
The terms "rent" and "rent(s)" as used in this Section 16.2 shall
include Monthly Rent, Additional Rent, and all other fees and charges of any
kind or nature required to be paid by Tenant pursuant to the provisions of this
Lease.
16.3 RIGHT TO CURE TENANT'S DEFAULT. Landlord, at any time after Tenant
commits a default or breach and the applicable cure period has expired, may
at its option cure the default at Tenant's cost. If Landlord at any time, by
reason of Tenant's default, pays any sum on behalf of Tenant, the sum paid by
Landlord shall be due immediately from Tenant to Landlord at the time the sum
is paid by Landlord until Landlord is reimbursed by Tenant. Such sum together
with interest thereon shall be Additional Rent hereunder.
16.4 RIGHT TO RENTS, ISSUES AND PROFITS. In the event this Lease is
terminated pursuant to this Article XVI, all of the right, title, estate and
interest of Tenant in and to (a) the Premises, (b) all rents, issues and
profits of the Premises whether then accrued or to accrue; (c) all insurance
policies and all insurance monies paid or payable thereunder; and (d) at the
election of Landlord, all subleases then in existence for any part or parts
of the Premises shall, without compensation being paid therefore, pass unto
and vest in and become the property of Landlord, free of any trust, or claim
thereto by Tenant. Tenant hereby assigns to Landlord all subrents and other
sums falling due from subtenants, licensees, and concessionaires during any
period in which Landlord has the right to re-enter the Premises upon Tenant's
breach of this Lease and Tenant shall not have any right, interest or claim
in or to such sums during such period.
16.5 LATE CHARGE. Tenant hereby acknowledges that late payment by Tenant to
Landlord of Monthly Rent, Additional Rent and all other sums due hereunder
will cause Landlord to incur costs not contemplated by this Lease, the exact
amount of which will be extremely difficult to ascertain. Accordingly, if any
installment of Monthly Rent, Additional Rent or any other sums due from
Tenant shall not be received by Landlord within five (5) business days after
such amount shall be due, Tenant shall pay to Landlord a late charge equal to
the percentage shown in Section 1.18 of such overdue amount. Such late charge
shall be due notwithstanding the fact that no notice is given by Landlord to
Tenant of such failure to pay. The parties hereby agree that such late charge
represents a fair and reasonable estimate of the costs Landlord will incur by
reason of late payment by Tenant. Acceptance of such late charge by Landlord
shall in no event constitute a waiver of Tenant's default with respect to
such overdue amount nor prevent Landlord from exercising any of the other
rights or remedies granted hereunder.
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16.6 CUMULATIVE REMEDIES. The several rights and remedies granted to Landlord
under this Article XVI shall be cumulative and in addition to any others it
may be entitled to by law or in equity, and the exercise of one or more
rights or remedies shall not prejudice or impair the concurrent or subsequent
exercise of any other rights or remedies.
ARTICLE XVII.
LANDLORD'S DEFAULT; TENANT REMEDIES
17.1 LANDLORD'S DEFAULT. Landlord shall not be deemed to be in default in the
performance of any of its obligations hereunder unless it has failed to
perform such obligation within thirty (30) days after written notice by
Tenant to Landlord specifying the nature of Landlord's default; provided,
however, that if the nature of the default is such that more than thirty (30)
days are required for its cure, then Landlord shall not be deemed to be in
default if it shall commence such cure within such thirty (30) day period and
thereafter diligently pursue completion thereof.
17.2 TENANT'S REMEDIES. In consideration of the benefits accruing to it
hereunder, Tenant acknowledges, covenants and agrees that, in the event of
any actual or alleged failure, breach or default hereunder by Landlord and
except as otherwise provided in Section 6.3 of the Lease, the sole and
exclusive remedy of Tenant shall be against Landlord's interest in the
Premises and that:
(a) Except as otherwise set forth herein, Tenant's sole remedy
shall be by a suit or action at law or in equity and Tenant
shall not in any event or under any circumstances by entitled
to withhold rent or to terminate this Lease;
(b) No partner, subsidiary, officer, shareholder, director,
employee, sister corporation or agent of Landlord shall be
sued or named as a party in any suit or action and no service
of process shall be made against any partner of Landlord
(unless required to secure jurisdiction of the partnership);
(c) No partner, subsidiary, officer, shareholder, director,
employee, sister corporation or agent of Landlord shall be
required to answer or otherwise file responsive pleadings; and
(d) No judgment shall be taken against any partner, subsidiary,
officer, shareholder, director, employee, sister corporation
or agent of Landlord and no writ of execution shall be levied
against the assets of any partner, subsidiary, officer,
shareholder, director, employee, sister corporation or agent
of Landlord.
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ARTICLE XVIII.
MORTGAGE OF LANDLORD'S INTEREST
18.1 SUBORDINATION OF TENANT'S RIGHTS. The rights of Tenant hereunder shall
be subject to and subordinated at all times to all ground or underlying
leases which are in effect or may hereafter be executed affecting the
Project, and the lien of all mortgages and deeds of trust in any amount or
amounts whatsoever now or thereafter placed on or against the Project or on
or against Landlord's interest or estate therein or on or against all such
ground underlying leases, all without the necessity of having further
instruments executed on the part of Tenant to effectuate such subordination;
PROVIDED, HOWEVER, that if requested, Tenant shall execute whatever
documentation may be required to further effect the provisions of this
section within ten (10) days of Tenant's receipt thereof.
(a) Landlord shall, as a condition to Tenant's agreement to
subordinate this Lease to any mortgage or deed of trust now or
hereafter placed upon the Premises, obtain a non disturbance
agreement from each holder providing that such holder shall not
disturb Tenant's possession under this Lease in the event of
foreclosure or transfer in lieu thereof. Any such agreement may
require Tenant to confirm the subordination of this Lease and to
agree to attorn to such holder.
18.2 ATTORNMENT. In the event any proceedings are brought for the foreclosure
of, or in the event of the exercise of the power of sale under any Landlord's
mortgage, Tenant shall, if so requested, and provided purchaser or grantee
provides a non-disturbance agreement to Tenant, attorn to the purchaser upon
such foreclosure or sale or the grantee upon any grant of a deed in lieu of
foreclosure, and recognize such purchaser, or grantee, as Landlord under this
Lease.
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ARTICLE XIX.
LANDLORD'S ACCESS
Landlord may enter the Premises at any time with reasonable notice
during reasonable hours to: (a) inspect the same; (b) exhibit the same to
prospective purchasers, mortgagees or tenants; (c) determine whether Tenant is
complying with all its obligations hereunder; (d) supply any service to be
provided by Landlord to Tenant hereunder; (e) post notice of
nonresponsibility; (f) post "To Lease" signs of reasonable size upon the
Premises during the last ninety (90) days of the Term hereof; and (g) make
repairs required of Landlord under the terms hereof or repairs to any
adjoining space or utility services, or make alterations or additions to any
other portion of the Project; provided, however, that all such work shall be
done as promptly as reasonably possible and so as to cause as little
interference to Tenant as reasonably possible. Tenant hereby waives any claim
for damage for any injury or inconvenience to or interference with Tenant's
business, or any loss of occupancy or quiet enjoyment of the Premises in
connection with Landlord's entry into the Premises pursuant to this Article
XIX. Landlord shall at all times have and retain a key with which to unlock
all of the doors in, on and about the Premises (excluding Tenant's vaults,
safes and similar areas designated in writing by Tenant in advance) and
Landlord shall have the right to use any and all means which Landlord may deem
proper to open doors in an emergency in order to obtain entry to the Premises.
Any entry to the Premises obtained by Landlord by any of such means, or
otherwise, shall not under any circumstances be construed or deemed to be a
force or unlawful entry into or a detainer of the Premises or an eviction,
actual or constructive, of Tenant from the Premises, or any portion thereof.
ARTICLE XX.
INTENTIONALLY DELETED.
ARTICLE XXI.
BANKRUPTCY
21.1 EFFECT OF TENANT BANKRUPTCY. If Tenant shall file a petition in voluntary
bankruptcy under Chapter 7, Chapter 11 or Chapter 13 of the Bankruptcy Acts as
then in effect, or if involuntary bankruptcy proceedings are brought against
Tenant and said involuntary bankruptcy proceedings have not been vacated or
stayed within thirty (30) days from the date thereof, or if a receiver or
trustee be appointed to Tenant's property and the order appointing such
receiver or trustee shall not be set aside or vacated within thirty (30) days
after the entry thereof, or if Tenant shall assign Tenant's estate for the
benefit of creditors, or if this Lease shall otherwise by operation of law
evolve or pass to any person or persons other than Tenant, then and in any
such event Landlord may terminate this Lease. Landlord, in addition to any and
all rights and remedies allowed by law or equity, shall upon such termination
be entitled to recover damages in an amount equal to
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the then present value of the rent reserved in this Lease for the entire
residue of the Term, less the fair rental value of the Premises for the
residue of the Term, and neither Tenant nor any person claiming through or
under Tenant, or by virtue of any statute or order of any court, shall be
entitled to possession of the Premises, but shall forthwith quit and surrender
the Premises to Landlord. Nothing herein contained shall limit or prejudice
the right of Landlord to prove and obtain as liquidated damages by reason of
any such termination an amount equal to the maximum allowed by any statute or
rule of law in effect at the time even though such amount is greater than the
amount of damages recoverable under the provisions of this Section 21.1.
21.2 EFFECT OF LEASE ASSIGNMENT. In the event that any proceeding under the
Bankruptcy Act is instituted in which Tenant is the debtor and this Lease is
assigned to any person or entity pursuant to the provisions of the Bankruptcy
Code, 11 U.S.C. 101 ET. SEQ., any and all monies or other consideration
payable or otherwise to be delivered in connection with such assignment shall
be paid or delivered to Landlord and shall be and remain the exclusive
property of Landlord and shall not constitute property of Tenant or of the
estate of Tenant within the meaning of the Bankruptcy Code. Any and all monies
or other consideration which constitutes Landlord's property under the
preceding sentence but which has not been paid or delivered to Landlord shall
be held in trust for the benefit of Landlord and be promptly paid to or turned
over to Landlord. If Tenant assumes this Lease and proposes to assign the same
pursuant to 11 U.S.C. 101 ET. SEQ. to any person or entity who shall have made
a bona fide offer to accept an assignment of this Lease on terms acceptable to
Tenant, then notice of such proposed assignment, setting forth (a) the name
and address of such persons, (b) all of the terms and conditions of such
offer, (c) financial statements of the proposed assignee, and (d) the adequate
assurance to be provided Landlord to assure such person's performance under
this Lease, including, without limitation the assurance referred to in Section
365(b)(3) of the Bankruptcy Code, shall be given to Landlord by Tenant no
later than twenty (20) days after receipt by Tenant but in any event no later
than ten (10) days prior to the date that Tenant shall make application to the
court of competent jurisdiction for authority and approval to enter into such
assignment and assumption. Landlord shall thereupon have the prior right and
option to accept an assignment of this Lease on the same terms and conditions
and for the same consideration, if any, as the bona fide offer made by such
person, less any brokerage commissions which may be payable out of the
consideration to be paid by such person for the assignment of this Lease. Any
person or entity to which this Lease is assigned pursuant to 11 U.S.C. 101 ET.
SEQ. shall be deemed without further act or deed to have assumed all of the
obligations arising under this Lease on and after the date of such assignment.
Any such assignee shall upon demand execute and deliver to Landlord an
instrument confirming such assumption.
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ARTICLE XXII.
SIGNS, DISPLAYS AND ADVERTISING
22.1 SIGNS. No signs shall be permitted outside of the Premises unless
the same are reasonably approved by Landlord. Landlord has no obligation to
install any signs, and the entire expense of any sign permitted hereunder will
be borne in full by Tenant, except that Landlord shall permit Tenant building
signage, monument signage, directory listing and suite signage at Tenant's
expense, subject to City of Austin and architectural approval. Upon the
installation of signs purchased by Tenant, such signs shall immediately become
part of the realty and belong to Landlord. No signs other than those that
comply with the approved sign criteria shall be allowed.
22.2 DISPLAYS. Tenant may not display or sell merchandise outside the
defined exterior walls and permanent doorways of the Premises. Tenant further
agrees not to install any exterior lighting, amplifiers or similar devices for
use in or about the Premises or any advertising medium, any of which may be
heard or seen outside the Premises, such as searchlights, loudspeakers,
phonographs or radio broadcasts.
22.3 MAINTENANCE OF SIGNS. Tenant shall at all times maintain its signs in a
neat, clean and orderly condition. If Tenant shall fail to do so after ten
(10) days written notice from Landlord, Landlord may repair, clean or maintain
such sign and the cost thereof shall be payable by Tenant to Landlord upon
demand as Additional Rent hereunder.
22.4 ADVERTISED NAME. The name of the Project is specified in Section 1.1
above, or such other name as Landlord and Tenant may agree. Tenant may use as
its advertised business address the name of the Project.
ARTICLE XXIII.
GENERAL PROVISIONS
23.1 ESTOPPEL CERTIFICATE. Tenant shall at any time upon not less than ten
business (10) days prior written notice from Landlord execute, acknowledge and
deliver to Landlord a statement in writing (1) certifying that this Lease is
unmodified and in full force and effect (or, if modified, stating the nature
of such modification and certifying that this Lease, as so modified, is in
full force and effect) and the date to which the rent, security deposit and
other charges are paid in advance, if any, and (2) acknowledging that there
are not, to Tenant's knowledge, any uncured defaults on the part of Landlord
hereunder, or specifying such defaults, if any, which are claimed and such
other items as are reasonably requested by Landlord. Any such statement may be
conclusively relied upon by any prospective purchaser or encumbrancer of the
Premises. Tenant's failure to deliver such statement within such time shall be
conclusive upon Tenant (1) that this Lease is in full force and effect without
modification, except as may be represented by Landlord, (2) that there are no
uncured defaults in Landlord's performance, and (3) that no more
33
than one (1) month's rent has been paid in advance. Tenant's obligation to
furnish Estoppel Certificate in a timely fashion is a material inducement for
this Lease.
23.2 WAIVER. No waiver by Landlord of any breach by Tenant of any covenant or
condition herein shall be effective unless such waiver is in writing, signed
by Landlord and delivered to Tenant. The waiver by Landlord of any such breach
or breaches, shall not constitute a waiver or relinquishment for the future of
any such covenant or condition or of any subsequent breach of any covenant or
condition, nor bar any right or remedy of Landlord in respect of any such
subsequent breach. The receipt of any rent by Landlord or any portions
thereof, shall not operate as an accord and satisfaction or waiver of the
right of Landlord to enforce the payment of rents of any kind previously due
or as a bar to the termination of this Lease and the recovery of the Premises
because of default in the payment of such rents previously due, by any
appropriate remedy Landlord may elect.
23.3 SURRENDER OF PREMISES; HOLDOVER TENANCY. Tenant agrees on the last day of
the Term or on the earlier termination of this Lease to surrender the
Premises, including all improvements, alterations, additions and installations
made by Tenant (or any subtenant licensee or concessionaire) which Tenant is
not required to remove pursuant to the provisions hereof, in good order,
condition and repair. No account or thing done by Landlord or its agents
during the Term shall be deemed an acceptance of a surrender of the Premises
and no agreement to accept such surrender shall be valid unless in writing and
signed by Landlord. In the event Tenant shall hold the Premises after the
Expiration Date with the prior written consent of Landlord, such holding over
shall be deemed to have created a tenancy from month to month, terminable on
thirty (30) days written notice by either party to the other, at a Monthly
Rent equal to one hundred twenty five (125%) of the Monthly Rent payable by
Tenant hereunder during the last full Lease Year of the Term or such other
lesser amount as determined by Landlord and of which Tenant has been notified,
and otherwise subject to all of the terms, conditions and provisions of this
Lease. If Tenant fails to surrender the Premises upon the termination of this
Lease, Tenant agrees to and shall indemnify and hold harmless and defend
Landlord from and against any loss or liability, including costs and
reasonable attorneys' fees, resulting from such failure to surrender,
including, but not limited to, any claims made by any succeeding Tenant based
on or resulting from such failure to surrender. This indemnity, hold harmless
and duty to defend provision shall survive termination of this Lease. Nothing
contained herein shall be construed as a consent to any occupancy or
possession of any portion of the Project by Tenant beyond the Expiration Date
or earlier termination of this Lease.
23.4 NOTICES. All notices, demands, consents or approvals which may be given
by either party to the other shall be in writing and shall be delivered either
personally or by certified mail, return receipt requested and addressed to
those addresses specified for Landlord and Tenant in Paragraphs 1.19 and 1.20
respectively. Notices sent by mail shall be deemed to have been given when
properly mailed and the postmark affixed by the United States Post Office
shall be conclusive evidence of the date of mailing.
23.5 PARTIAL INVALIDITY; SEVERABILITY; CONSTRUCTION. If any term or provision
of this Lease shall to any extent be held to be illegal, invalid or
unenforceable, the remainder of this Lease shall not
34
be affected thereby, and in lieu of such illegal, invalid, or unenforceable
provision, there shall be added as a part of this Lease a provision similar in
terms to such illegal, invalid or unenforceable provision as may be possible,
and be legal, valid and enforceable. Tenant acknowledges that opportunity has
been provided for review and comment on the provisions in this Lease by
Tenant's attorneys, and the rule of construction that ambiguities are to be
resolved against the drafting party shall not be applicable to this Lease.
23.6 CORPORATE RESOLUTION. Intentionally Deleted.
23.7 LIMITED PARTNERSHIP. If Landlord herein is a limited partnership, it is
understood and agreed that any claims by Tenant against Landlord shall be
limited to the assets of the limited partnership. Tenant expressly waives any
and all rights to proceed against the individual partners, or its officers,
directors and shareholders or any corporate partners, except to the extent of
their interest in such limited partnership.
23.8 CAPTIONS. The captions and headings 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 of any provisions thereof.
23.9 SHORT FORM LEASE. Tenant shall not record a short form memorandum of this
Lease unless consented to in writing by Landlord. In the event a short form
memorandum is recorded, it shall be recorded in the office of the County
Recorder where the Project is located; provided, however, that the terms,
covenants and conditions of this Lease shall control such memorandum. In no
event shall Tenant record this Lease without prior written consent of Landlord.
23.10 BROKER'S COMMISSIONS. Each party represents to the other that it is not
obligated to any broker, finder or real estate or financing agent in
connection with this Lease unless specified in Paragraph 1.15 and each party
agrees to defend, indemnify and hold harmless the other from any claim, suit
liability or demand made by the other party by any other person, firm or
corporation for brokerage fees, finder's fees or commissions of other similar
compensation with respect to this Lease or any sublease on the Premises. This
provision shall survive termination of this Lease.
23.11 ATTORNEYS' FEES. Notwithstanding the indemnity, hold harmless and duty
to defend provisions hereunder in the event of litigation regarding this
Lease, the losing party shall pay to the prevailing party its costs of
litigation including reasonable attorneys' fees.
23.12 COUNTERPARTS. This Lease may be executed in counterparts, each of which
may be deemed an original but all of which together shall constitute one and
the same instrument.
23.13 SOLE AGREEMENT. This Lease contains all of the agreements of the parties
hereto with respect to the lease transaction, and no prior agreements, oral or
written, or representations of any nature whatsoever pertaining to any such
matters shall be effective for any purpose unless specifically incorporated in
writing. This Lease may not be modified, amended, or altered except by an
agreement in writing signed by Landlord and Tenant.
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23.14 SUCCESSORS AND ASSIGNS. Subject to the provisions hereof relative to an
assignment, this Lease shall be binding upon and inure to the benefit of the
heirs, executors, administrators, successors and assigns of the respective
parties thereto. In the event Landlord shall sell or otherwise transfer its
interest in the Premises and as a part of such transaction shall assign its
interest as Landlord in and to this Lease, then from and after the effective
date of such transfer, Landlord shall have no further liability, including any
monetary obligations, under this Lease to Tenant, it being intended that the
covenants contained herein shall be binding upon Landlord and its successors
and assigns only during their respective periods of ownership of Landlord's
interest hereunder. Tenant's security deposit will be assigned and delivered
to the assignee and the assignee will acknowledge (i) receipt of the security
deposit and (ii) assignee's obligation to return same to Tenant at the end of
the lease term in accordance with the terms of this Lease.
23.15 LICENSEES; CONCESSIONAIRES. For the purpose of this Lease, any
concessionaire or licensee of Tenant conducting business upon or from the
Premises shall be deemed to be a subtenant of Tenant, and all of the
provisions of this Lease relating to subletting and subtenants shall apply to
the granting of any concession or license and shall apply to the
concessionaire or licensee thereunder with the same force and effect as though
such provisions thereto specifically applied.
23.16 NO MERGER. The voluntary or other surrender of this Lease by Tenant, or
a mutual cancellation thereof, shall not work a merger, and shall, at the
option of Landlord, operate as an assignment to it of any or all subleases or
sub tenancies.
23.17 MODIFICATION FOR LENDER. If, in connection with obtaining financing for
the Project of which the Premises are a part, the lender shall request
reasonable modifications in this Lease as a condition to such financing,
Tenant shall within ten (10) days of written notice by Landlord not
unreasonably withhold, delay or deter its consent thereto, provided that such
modifications do not increase the monetary obligations of Tenant hereunder or
materially adversely affect the leasehold interest hereby created.
23.18 COMPLIANCE WITH LAW. Tenant shall not use the Premises or permit
anything to be done in or about the Premises which will in any way conflict
with any law, statute, ordinance or government rule or regulation or any
covenant, condition or restriction now in force or which may hereafter be
enacted or promulgated. Tenant, at its sole expense, shall comply with all
laws (including, without limitation, Environmental Requirements, as defined
herein, and laws regarding access for handicapped or disabled persons),
ordinances and regulations, and all declarations, covenants, and restrictions,
applicable to Tenant's use or occupation of the Premises, and with all
governmental orders and directives of public officers which impose any duty or
restriction with respect to the use or occupation of the Premises. Tenant
shall cause additional improvements to the Premises done after the
Commencement Date to comply with the Americans with Disabilities Act or
similar state statutes or local ordinances or any regulations promulgated
thereunder, all as may be amended from time to time (the "ADA"), and Tenant
shall cause the Premises (and to the extent required by the Premises, the
Project) to hereafter comply with ADA. Notwithstanding the foregoing, as of
the Commencement Date, Landlord shall make the Project (as defined on EXHIBIT
C) and other work to be performed and described on EXHIBIT C
36
in compliance with the ADA. Landlord will cause the exterior areas of the
Project to be in compliance with current and future changes as required by
state or federal agencies.
23.19 JOINT AND SEVERAL OBLIGATIONS. If more than one person or entity is
Tenant, the obligations imposed on that party shall be joint and several. If
Tenant is a partnership, the obligations of each general partner shall be
joint and several.
23.20 LIGHT, AIR, VIEW. Any diminution or shutting off of light, air or view
by any structure which may be erected on lands adjacent to the Project shall
in no way affect this Lease or impose any liability on Landlord.
23.21 NO OFFER. The submission of this document for examination and discussion
does not constitute an offer to lease, or a reservation of, or option for, the
Premises. This document will become effective and binding only upon execution
and delivery by Landlord to Tenant.
23.22 LEGAL TENDER. Rent and all other sums payable under this Lease must be
paid in lawful money of the United States of America.
23.23 CONFLICT OF LAWS; VENUE. This Lease shall be governed by and construed
pursuant to the laws of the state in which the Premises are situated. The
exclusive venue for any action brought under this Lease shall be in the county
in which the Premises are situated.
23.24 INDEMNIFICATION. All indemnification, hold harmless and duty to defend
provisions hereunder shall survive termination of this Lease.
23.25 TIME IS OF THE ESSENCE. Time is of the essence in all things pertaining
to the performance of this Lease.
23.26 NO THIRD PARTY BENEFICIARIES. There are no third party beneficiaries
with respect to this Lease.
23.27 NONDISCLOSURE OF LEASE TERMS. Subject to the restrictions contained in
Section 3.6, neither party shall disclose any of the material terms and/or
provisions of this Lease to any person or entity not a party to this Lease,
except to underwriters, investors, attorneys, lenders, partners, prospective
purchasers or assignees and accountants and as required. In the event that
this provision is breached, the responsible party shall be liable for all
damage or injury to the other resulting from failure to keep all such
information confidential and shall indemnify and hold the other harmless from
any damage, loss or injury occasioned thereby.
23.28 GRAMMATICAL CONSTRUCTION. Where appropriate, the masculine gender may
include the feminine or neuter, and the singular may include the plural, and
vice versa.
23.29 EXHIBITS. All Exhibits attached hereto are incorporated by reference
herein.
37
LANDLORD:
RIVERSIDE RESOURCES INVESTMENTS, LTD.
a Texas Limited Partnership
By: RIVERSIDE RESOURCES
MANAGEMENT, LLC
General Partner
By: /s/ Xxxxxx Xxxxxxx
---------------------------------
Printed Name: Xxxxxx X. Xxxxx
Title: Manager
Date: JUNE 19, 2000
TENANT:
Xxxxxx'x, Inc.
a Delaware Corporation
By: /s/ Xxxxxxx X. Spain
---------------------------------
Printed Name: Xxxxxxx X. Spain
Title: Chairman and CEO
Date: JUNE 19, 2000
38
EXHIBIT A
FLOOR PLAN
[ATTACH FLOOR PLAN]
LEGAL DESCRIPTION
Proposed Lot 2, ButterKrust Subdivision, 0000 Xxxxxxx Xxxx., Xxxxxx, Xxxxx. [TO
BE PROVIDED BY LANDLORD UPON COMPLETION]
39
EXHIBIT B
PARKING AREAS
Landlord and Tenant also agree that Tenant shall have the right to use 385
parking spaces ("Parking Spaces"), at a charge of $0 per space, at all times
during the Lease Term and all renewal terms. Landlord may, but shall not be
required to, make, modify, or enforce reasonable rules and regulations
relating to the parking of vehicles and Tenant hereby agrees to obey such
rules and regulations. Vehicles shall be towed at owner's expense for any of
the following violations: (a) parking in any area other than as specifically
designated by Landlord, or (b) failure of such vehicle to have a parking
permit, if issued by Landlord, properly affixed thereto. At all times during
the Term, Landlord has the right, but not the obligation, to issue parking
permits which will authorize the parking of vehicles of Tenant or its
employees in such areas as may be designated by Landlord. Tenant acknowledges
that the tract will be subject to cross-access agreements that grant ingress
and egress easements over, through and across the Property to and from the
adjacent public right-of-ways, to and from the proposed lots, and across the
common boundary lines separating the Property and the proposed lots.
40
EXHIBIT C
IMPROVEMENTS
1. Landlord will provide the base building and tenant improvements in
accordance with the attached Exhibit C-1 ("the Improvements").
It is agreed that Landlord will complete construction of the
Improvements within the Premises in accordance with the following,
subject to Tenant providing all necessary documents on or before the
dates stipulated herein. Failure to do so will constitute a "Tenant
Delay."
In the event that the Tenant improvements or base building doors,
frames and hardware, mechanical, electrical (including light fixtures)
and plumbing specified in the final working drawings, as defined in
paragraph (b) below, differ in scope or specification from those
outlined in the Exhibit C-1, Tenant shall be responsible for the net
excess costs associated with the modification, ("Excess Costs").
Landlord shall determine the net excess costs by accounting for the
difference between increases and decreases in the cost of the
Improvements, which includes associated contractor fees and taxes.
Tenant shall pay Landlord the Excess Costs within ten (10) days after
receipt of Landlord's invoice for such excess. No portion of the
Improvements shall be constructed and no portion of the cost of the
Improvements shall be disbursed by Landlord until such time as the
final working plans have been finalized and agreed to by Landlord and
Tenant, the final pricing for the construction and installation of the
Improvements has been agreed to by Landlord and Tenant and any Excess
Costs have been deposited with Landlord.
(a) Preliminary working drawings and specifications of materials
relating to all improvements (the "Improvements") that Tenant desires
to be installed in the Premises shall be submitted to Landlord no later
than August 15, 2000. Such drawings and the specifications of materials
shall be subject to approval by Landlord. Upon completion of the
Preliminary working drawings and specifications, Landlord and Tenant
shall obtain preliminary pricing for the improvements. Within three (3)
days after receipt of the preliminary pricing, Landlord and Tenant
shall make revisions or modifications to the scope and specifications
to be included in the final working drawings and specifications.
(b) Final working drawings and specifications of materials relating to
all improvements (the "Improvements") that Tenant desires to be
installed in the Premises shall be submitted to Landlord no later than
October 1, 2000. Such drawings and the specifications of materials
shall be subject to approval by Landlord.
(c) Construction shall be bid by not less than three (3) subcontractors
with the exception of the base building mechanical subcontractor.
Landlord or other contractor acceptable to Landlord shall perform as
general contractor for the construction of all Improvements in
accordance with the final working drawings and specifications approved
by Landlord.
41
2. If Tenant requests changes in the approved plans and specifications for
the Improvements and if such changes shall delay the work to be
performed hereunder, or if Tenant shall otherwise delay the completion
of said work, including, without limitation, failure by Tenant to
timely submit final working drawings and specifications of materials
for Landlord's approval, then, notwithstanding any provision to the
contrary in this Lease, Tenant's obligation to pay rent thereunder
shall nevertheless commence on the date upon which the rent would have
been due but for the Tenant delay, and Tenant shall be obligated to pay
for the incremental costs associated with such changes.
Tenant requested changes shall be priced by Landlord, approved by
Tenant and the associated cost shall be deposited with Landlord prior
to the commencement of construction. The relative charge for fee and
associated general conditions shall be added to the cost of the change
based upon the same percentages as the initial improvements to the
project.
Tenant may specify finishes associated with allowance items noted on
Exhibit C-1, subject to Landlord approval, which shall not be
unreasonably withheld. As noted in Exhibit C-1 attached, Landlord is
providing a $1.00 psf allowance for architectural and MEP design.
Landlord and Tenant shall mutually select all architectural and MEP
designers for the Tenant Improvements; provided however that Landlord
shall select all base building architectural and MEP designers, all
such selections to be subject to reasonable selection criteria. Tenant
shall pay design fees costs directly to the designer. Landlord shall
reimburse Tenant upon initiation of Construction of the Improvements.
Material and Workmanship Warranty. Landlord shall warrant all materials
and workmanship provided in the Improvements to be free of defects in
materials, workmanship or installation, under conditions of normal use,
until the expiration of the first Lease Year, or for such longer period
as may be obtainable by Landlord from its contractors, subcontractors
or vendors furnishing same. Any repairs required for elements covered
under the foregoing warranty shall be made by Landlord, as provided in
the Lease, and shall not be includable as Direct Expenses. In
connection with the foregoing, Landlord shall provide all new HVAC
equipment which shall be manufactured by reputable vendors such as, but
not limited to Trane, Carrier and XxXxxx.
42
EXHIBIT C-1CONSTRUCTION SCOPE PROFILE
---------------------------- ----------------------------------------------------------- --------------------------------------
PROVIDED PROVIDED BY LANDLORD IN TENANT
BY LANDLORD IN BASE BUILDING IMPROVEMENT DEFINITION
---------------------------- ----------------------------------------------------------- --------------------------------------
1. CEILING Install Insulation Drop Ceiling allowance: $12,500.
Specification: Color: White Rating: R19
Clean and paint bar joists
---------------------------- ----------------------------------------------------------- --------------------------------------
2. LIGHT Purchase and install low bay fixtures on a 16 x 18 grid Purchase and install exit lights =
FIXTURES Fixture specification 250-watt metal halide. 30 quantity
Assumed quantity 200 Foot-candle = 25 Emergency lights = 50 quantity
Mounting height = 14' Purchase and install lay in
fixtures
Fixture specification:
Lithonia or comparable 2'x4', 18 cell, 3 lamp, parabolic,
277v, energy saving fixture w/ 3 energy saving
lamps Assumed quantity 100
Exterior Light = 20 wall pack 250 xxxx XX fixtures around
perimeter Lighting
Allowance - $1.85 psf
---------------------------- ----------------------------------------------------------- --------------------------------------
3. LIGHT Install to service requirement noted in section 2 Install to service requirement noted
SWITCHES in section 2
---------------------------- ----------------------------------------------------------- --------------------------------------
4. ELECTRICAL Miscellaneous Power: Provide 2 weatherproof outlets on Cubicle power: Provide 90, 3/4 conduit
OUTLETS each exterior wall and 8 on roof. drops with 3 circuits to 4x4 box for
cubicle base feeds. Includes a
neutral for each circuit. Service
provided for 400 workstations.
---------------------------- ----------------------------------------------------------- --------------------------------------
5. PHONE/DATA Data & Telecom: Provide 350 linear
OUTLETS feet of 24"w x 2" d cable tray grid
and 400 linear feet of 6"w x 2"d
cable tray adjacent to column lines.
Provide 100, 1" conduit drops on
columns and walls for cubicle base
feeds. Terminate conduit at 14' above
floor. Assume raceway only. All data
cabling excluded.
---------------------------- ----------------------------------------------------------- --------------------------------------
6. ELECTRICAL Provide 2000 amp, 277/480 v, 3 phase, 4w, main Excludes cost of generator, UPS
SERVICE switchboard from existing service feeders. equipment and specialty electrical
Distribution: Provide panels and transformers, per the equipment not identified.
attached panel schedule. Service provided: approximately
20 xxxxx psf inclusive of air conditioning and
approximately 6.5 psf to office space net of HVAC and
lights.
---------------------------- ----------------------------------------------------------- --------------------------------------
7. FIRE ALARM/ Provide base building sprinkler system as required by Provide a fire alarm system with
SPRINKLER code for all open office and interior office space pull stations at the egress doors,
SYSTEM identified in Section 8. smoke detectors in each of the air
conditioners, and connection to the
fire sprinkler system switches.
43
---------------------------- ----------------------------------------------------------- --------------------------------------
8. PARTITIONS Interior partitions are 9' height, 3 5/8" metal studs Conference = 1 unit, 450 sqft
with 5/8" gypsum board on each side. Raco top track, Board Room = 1 unit, 300 sqft
tape/float/painted finish, and 21/2" cove rubber base each Library = 1 unit, 2,000 sqft
side. Excludes suspended ceilings and interior glass Server = 1 unit, 700 sqft
walls. Storage = 1 unit, 200 sqft
Training = 1 unit, 700 sqft
Focus Rooms = 4 units, 90 sqft each
Break = 1 unit, 500 sqft
Conference = 2 units, 375 sqft each
Shipping = 1 unit, 1,500 sqft
Receiving = 1 unit, 300 sqft
Copy = 3 units, 200 sqft each
Copy = 2 units, 60 sqft each
Coffee = 2 units, 60 sqft each
Linear footage = 2,000 ft
Includes application of 2 coats of
paint on masonry surface of all
perimeter and separation area walls.
Excludes sheetrock on perimeter and
separation walls.
---------------------------- ----------------------------------------------------------- --------------------------------------
9. DOORS/ Install entry doors and frames: Allowance = $4,000
FRAMES/ 2 south, 1 east and 1 west
HARDWARE
---------------------------- ----------------------------------------------------------- --------------------------------------
10. CABINETRY None Allowance = $15,000
---------------------------- ----------------------------------------------------------- --------------------------------------
11. FLOORING Level floor to accommodate requirements for accessibility Allowance = $20 per yard
and flooring.
---------------------------- ----------------------------------------------------------- --------------------------------------
12. SIGNAGE Building directory and exterior monument is permitted. Cost of installation subject to an
allowance = $5,000.
---------------------------- ----------------------------------------------------------- --------------------------------------
13. WINDOW Allowance = $4,500 for blinds.
TREATMENT
---------------------------- ----------------------------------------------------------- --------------------------------------
14. MECHANICAL Equipment: Provide 28, 10 ton (nominal), roof top package Provide 6 supply air round step cone
air conditioning units with gas heating on perimeter faced diffusers with 16" 0 neck, per
units and insulated roof curbs. Units shall have unit.
adjustable minimum outside air damper. Controls: Provide a simple central
Duct: Exposed. Supply Ductwork shall be sheet metal with control system with remote zone
11/2" external insulation. Return shall be lined sheet thermostats (sensors) and clock
metal with at least one elbow (for sound attenuation) and functions. System shall be capable
2-24"x24" metal egg crate type RA grilles. of on-off and unit status (heat,
Exhaust: Provide exhaust fans for each toilet block cool, off, and trouble) for each
(assume 2). unit, temperature monitoring and
reset of each zone, and after hours
reset of each unit.
---------------------------- ----------------------------------------------------------- --------------------------------------
15. PLUMBING Water and Sanitary: Connection to water and sanitary at Two restroom blocks
existing locations and routed to new toilets, janitor Men's = 5wc, 3ur, 3 lavs, floor drain
closets and break rooms. Assume new 3" water piping from Women's = 6wc, 3lavs, floor drain
front of building to new toilet blocks in existing Janitor closet - floor mounted mop
locations. Insulate water piping. sink, 20 gallon water heater
Drinking fountain - dual height
ADA complaint
Break room - ADA complaint dual bowl
sink, water connections.
Partition/Counter Top
---------------------------- ----------------------------------------------------------- --------------------------------------
44
---------------------------- ----------------------------------------------------------- --------------------------------------
Allowance=$5,000
---------------------------- ----------------------------------------------------------- --------------------------------------
16. SHELL Shell demolition to include: Design Allowance = $25,000
CONDITION Remove all interior walls, brick, plaster, sheetrock, Applied to interior/exterior of
metal studs and wood "Area separation" wall to remain secondary entry or interior design
Strip office area to two story structure features.
Remove engineering offices
Concrete mechanical mezzanine to remain South Entry Allowance:
Remove concrete curbs and pads from bakery area Canopy = $7,500
Remove all car wash elements Walks = $2,500
Remove all piping from all ceiling and wall areas Finishes and Lighting = $2,500
Remove all piping and gutters at rear of the building. Entry Doors = $3,500
Remove all HVAC equipment inside and on roof
Remove all electrical components, pipes, wires, generator
and fuel tank
Remove metal shed building
Remove all exterior overhead doors, except as requested.
Cap slab "pit" areas on bakery floor
---------------------------- ----------------------------------------------------------- --------------------------------------
17. SECURITY Card reader Allowance = $5,000
---------------------------- ----------------------------------------------------------- --------------------------------------
18. GLASS Replace storefront and entry glass. Selected replacement Interior glass excluded.
of clearstory glass. Remove window screens. Replace
selected overhead doors with vision glass.
---------------------------- ----------------------------------------------------------- --------------------------------------
19. BREAD STORE Relocate Break Store loading zone to north side. Entry canopy/ Exterior Finish
Maintain use of existing canopy. Allowance = $20,000
Interior Buildout from Shell = $20
psf (including demise wall)
---------------------------- ----------------------------------------------------------- --------------------------------------
20. DESIGN Demolition Architectural and MEP = $1.00 psf
---------------------------- ----------------------------------------------------------- --------------------------------------
21. GUTTER Repair and repaint.
---------------------------- ----------------------------------------------------------- --------------------------------------
22. MASONRY Repair and repaint corners and columns noted on the
PATCHING attached.
---------------------------- ----------------------------------------------------------- --------------------------------------
23. SITE Resurface existing paving and pave new spaces.
Add site lighting and sidewalks as required by
code. Remove existing fencing. Construct detention
facility. Provide lighting equal to an average of 2
foot candles.
---------------------------- ----------------------------------------------------------- --------------------------------------
24. ROOF Recoat south roof and reflash and reseal north
roof. Replace 8 existing skylights.
---------------------------- ----------------------------------------------------------- --------------------------------------
(a) Allowances are inclusive of remodeling tax, sales tax, materials,
installation and contractor's fees.
45
EXHIBIT D
DIRECT EXPENSES
For the purposes of this exhibit, the following is a defined term as
follows:
Direct Expenses: All direct costs of operation and maintenance of the
Project as determined by standard accounting practices, and shall include the
following costs, or estimated costs, by way of illustration, but not limited
to: real property taxes and assessments; rent taxes, (whether assessed against
Landlord or assessed against Tenant and collected by Landlord, or both); water
and sewer charges; insurance premiums; utilities; janitorial services; labor;
costs incurred in the management of the Project (including administrative
costs), if any; electrical service, air conditioning and heating; cost of
security for the Project; supplies, materials, equipment and tools;
maintenance, costs and upkeep of all parking areas (including interior and
exterior landscaping); and capital expenditures if they result in savings to
Tenant or are requested by Tenant. Direct Expenses shall not include the
following:
1) Costs incurred by Landlord in connection with the Property and any
improvements situated thereon which constitute capital expenditures
under generally accepted accounting principles, except those that
result in savings to Tenant or are requested by Tenant.
2) Depreciation of the Building and all equipment, fixtures, improvements
and facilities used in connection therewith.
3) Leasing commissions and marketing costs.
4) Any taxes, property or otherwise, to the extent Landlord is reimbursed
by any tenant other than under a rental adjustment provision.
5) The cost of repairs or other work occasioned by any casualty which is
reimbursed by insurance.
6) Legal fees, tax accounting and tax return preparation, or other
expenses incurred in connection with negotiations or disputes with
tenants, other occupants or prospective tenants of the Property.
7) Overhead and profit increments paid to subsidiaries, partners, and
parent companies or other affiliates of Landlord for services rendered
in connection with the Property; or for equipment, fixtures and
supplies sold to Landlord in connection therewith, but only to the
extent that the cost of such services or goods exceeds the cost which
would be paid by Landlord if the same were rendered or sold to Landlord
by an unrelated entity at competitive prices.
46
8) Landlord's general overhead and administrative expenses which are not
reasonably attributable to operating expenses of the Property or the
equipment, fixtures and facilities used in connection therewith, in
accordance with generally accepted principles, including salaries and
expenses of Landlord's executive officers.
9) Any compensation paid to clerks, attendants or other persons in
commercial concessions operated by Landlord.
10) All items and services for which Tenant reimburses Landlord or pays
third persons.
11) Costs related to maintaining Landlord's existence, either as a
corporation, or other entity.
12) Management fee shall be fair market value for comparable Class A
office/light industrial space in North Austin, to exceed 5% of net
rent.
13) Repairs during the initial ten Lease Years to the structural elements
of Buildings, including capital roof repairs and roof replacement,
exterior walls, foundations, floor slabs, water and wastewater service
to the Project, electrical service to the Project, except for damage
arising from Tenant or Tenant's use of the Project, casualty or damage
not covered by insurance and other minor repairs less than $2,500 per
year.
14) Interest, principal, taxes or other costs incurred in connection with
any actual or prospective loan.
Tenant shall pay the percent stated in Section 1.8 of the Direct
Expenses paid or incurred by Landlord on account of the operation or
maintenance of the Project. Landlord shall give to Tenant on or before the
first day of March of each year a statement of the rent payable attributable
to Direct Expenses to Tenant hereunder, but failure of Landlord to give such
statement by said date shall not constitute a waiver by Landlord of its right
to require a payment of rent attributable to Direct Expenses. Upon receipt of
the statement for the year following the Commencement Date of the Lease, the
amount shall be divided into twelve (12) equal monthly installments and Tenant
shall pay to Landlord, concurrently with the regular Monthly Rent payments
next due following the receipt of such statement, an amount equal to one (1)
monthly installment multiplied by the number of months from January in the
calendar year in which said statement is submitted to the month of such
payment. Subsequent installments shall be payable for the balance of the
calendar year and shall continue until the next statement is rendered. The
estimated expenses for the first year following the Commencement Date ("First
Year") shall be provided prior to the Commencement Date and shall be used to
determine the payments attributable to Direct Expenses for the first year. If
the next or any succeeding year results in a greater increase in Direct
Expense, then upon receipt of a statement from Landlord, Tenant shall pay a
lump sum equal to such total annual Direct Expense, less the total of the
monthly installments of estimated expenses paid in the previous calendar year
for which comparison is then being made;
47
and the estimated monthly installments to be paid for the next year, shall be
adjusted to reflect such increase. If in any year Tenant's share of Direct
Expenses is less than the preceding year, then upon receipt of Landlord's
statement, any overpayment made by Tenant on the monthly installment basis
provided above shall be credited towards the next Monthly Rent falling due and
the estimated monthly installment of Direct Expenses to be paid shall be
adjusted to reflect such lower Direct Expenses for the most recent year.
In connection with the annual reconciliation of expenses noted above, Tenant
shall have an opportunity to review budgeted services, vendors and associated
expenses relating to controllable expenses. However, Tenant shall not have the
ability to require Landlord to modify services, which would impact Landlord's
ability to perform its obligations under the Lease. Additionally, Tenant's
ability to review budgeted services shall not alter Tenant's obligation to pay
for Tenant's share of Direct Expenses. In the event Tenant objects to a budget
item, Landlord agrees to bid the service to three (3) mutually acceptable
vendors. Landlord agrees to not select the highest bidder, but does not
necessarily agree to select the lowest bidder.
Even though the Term has expired and Tenant has vacated the Premises,
the final determination of Tenant's share of Direct Expenses for the year in
which this Lease terminates shall be made within ninety (90) days of the date
this Lease terminates and Tenant shall pay, within twenty (20) days after
receipt of an invoice by Landlord, any increase due over the estimated
expenses paid and conversely any overpayment made in the event said expenses
decrease shall be immediately rebated by Landlord to Tenant.
Tenant shall have the right, at such time and place as Landlord may reasonably
designate, to inspect and audit Landlord's books and records related to the
Direct Expenses for the purpose of verifying Landlord's year-end statement.
Tenant may employ an independent public accounting firm to conduct the audit.
The costs of the audit shall be paid by Tenant unless the audit shows that
Landlord's adjusted statement overcharged Tenant its share of Direct Expenses
by more than five percent (5%), in which case Landlord shall pay the
reasonable cost of the audit.
TAXES
Tenant shall also pay its Proportionate Share of reasonable costs incurred by
Landlord in connection with seeking any reductions in the taxes, assessments
or other charges levied, assessed or imposed in connection with the Project,
including the cost of any third party tax service. Nothing contained herein
shall be construed as a waiver by Tenant of any statutory right it may have to
contest such taxes, assessments or other charges with the authority assessing
or levying same. Landlord shall deliver to Tenant notices of proposed or
actual assessment and tax bills issued. The parties agree to thereupon meet in
good faith and determine if a protest of any such taxes and assessments shall
be filed, and if so, the nature, means and estimated costs of such protest. In
the event Landlord elects not to protest, but not earlier than ten (10) days
prior to the due date for filing protests, Tenant may, but is not obligated
to, file a notice to protest. The
48
parties agree to make available upon request, without unreasonable delay, all
information in their possession reasonably necessary for the protesting party
to pursue such protest.
In the event that any such protest or tax assessment disputation can not be
resolved prior to the date the related taxes are due, Tenant shall pay
Landlord the amount due and Landlord will credit Tenant for any amounts in
excess of the final amount due.
49
EXHIBIT E
RULES AND REGULATIONS
(1) Sidewalks, doorways, vestibules, halls, and similar areas shall not
be obstructed, nor shall refuse, furniture, boxes or other items be
placed therein by Tenant or its officers, agents, servants and
employees, or used for any purposes other than ingress and egress to
and from the Premises, or for going from one part of the Project to
another part of the Project.
(2) Plumbing fixtures and appliances shall be used only for the
purposes for which constructed, and no unsuitable materials shall be
placed therein.
(3) No signs, directories, posters, advertisements or notices shall be
painted or affixed on or to any of the windows or doors, or in
corridors clearly visible from the exterior of the Building or other
parts of the Project, except in such color, size and style, and in such
places, as shall be first approved in writing by Landlord in its
discretion. Landlord shall have the right to remove all unapproved
signs without notice to Tenant, at the expense of Tenant.
(4) Tenant shall not do, or permit anything to be done, in or about the
Project, or bring or keep anything therein, that will in any way
increase the rate of fire or other insurance on the Project, or on
property kept therein or otherwise increase the possibility of fire or
other casualty.
(5) Landlord shall have the power to prescribe the weight and position
of heavy equipment or objects, which may over stress any portion of the
floor. All damage done to the Project by the improper placing of such
heavy items will be repaired at the sole expense of the responsible
Tenant.
(6) Tenant shall use its best efforts to notify the Landlord when safes
or other heavy equipment are to be taken in or out of the Project, and
the moving shall be done after permission is obtained from Landlord on
such conditions, as Landlord shall require. This provision shall not
apply to copiers, servers or other standard office or computer
equipment.
(7) Tenant shall keep the exterior Premises neat and clean.
(8) When conditions are such that Tenant must dispose of crates, boxes,
etc., on the sidewalks, it will be the responsibility of Tenant to
dispose of same.
(9) No motorcycles or similar vehicles will be allowed in the buildings
on the Project.
50
(10) No additional locks shall be placed upon any exterior doors
without the prior written consent of Landlord. All necessary keys may
be furnished by Landlord, and the same shall be surrendered upon
termination of this Lease.
(11) Tenant shall comply with such parking rules and regulations as may
be posted and distributed from time to time.
(12) No portion of the Project shall be used for the purposes of
lodging rooms.
(13) Tenant shall not make any significant changes or alterations to
any portion of the Project (i.e., those costing over $25,000) without
Landlord's prior written approval, which may be given on such
conditions as Landlord may elect.
(14) Landlord does not accept responsibility for spot removal or carpet
cleaning,in the event the carpet in Tenant's Premises becomes soiled or
torn.
(15) Landlord will not replace florescent tubes or incandescent light
bulbs in any lamps or light fixtures owned by Tenant Premises or in any
lamps or light fixtures other than the exterior project standard
fixtures attached on the building and in the parking area.
(16) Landlord reserves the right to rescind any of these rules and make
such other and further rules and regulations as in its judgment shall
from time to time be needed for the preservation of good order, in its
commercially reasonable judgment consistent with standards for similar,
single-tenant office/industrial space in North Austin.
51
EXHIBIT F
GUARANTEE OF LEASE
Intentionally Deleted
52
EXHIBIT G
PROHIBITED USES/ENVIRONMENTAL INDEMNITY/REPORTING OBLIGATIONS
Except substances for normal office purposes used, stored, treated,
discarded and disposed in accordance with all applicable laws, ordinances,
rules, regulations and requirements, Tenant or Landlord shall not use, store,
treat, discard or dispose of any hazardous substances in or about the
Premises. For purposes of this Lease, "hazardous substances" shall mean and
include those elements or compounds which are contained in the list of
hazardous substances adopted by the Environmental Protection Agency (EPA) and
the list of toxic pollutants designed by Congress or the EPA under any
applicable environmental law or legislation. To the extent that any of the
applicable environmental laws of the State of Texas establish a meaning for
"hazardous substances" which is broader than that specified in any federal
legislation or laws, such broader meaning shall apply. "Applicable
environmental law" shall mean and include the collective aggregate of the
following: any law, statute, ordinance, rule, regulation, order or
determination of any governmental authority or any board or fire underwriters
(or other body exercising similar functions) or any restrictive covenant or
deed restriction (recorded or otherwise) affecting the Premises pertaining to
health or the environment.
Without limiting the foregoing, if the presence of any hazardous
substances on the Premises caused or permitted by Tenant or Landlord results
in any contamination of the Premises, Tenant or Landlord, respectively, shall
promptly take all actions, at its sole expense, as are necessary to return the
Premises to the condition existing prior to the introduction of any such
hazardous substances to the Premises; provided that Landlord's approval of
such actions shall first be obtained, which approval shall not be unreasonably
withheld so long as such action would not have any potential material adverse
effect on the Premises. As between Landlord and Tenant, Landlord shall be
responsible for any contamination resulting from hazardous substances on the
Premises or other environmental conditions resulting from any actions or
substances existing on the Premises prior to Tenant's occupancy of the
Premises, and shall promptly take all actions, at its sole expense, as are
necessary to remediate the Premises.
Tenant and Landlord hereby indemnify and agree to defend and hold the
other harmless from and against any and all claims, demands, causes of action,
loss, damage, liability, cost and expenses (including reasonable attorney's
fees and court costs) and including, without limitation, costs incurred in
connection with any investigation of site conditions or any cleanup, remedial,
removal or restoration work required by any federal, state or local
governmental agency or political subdivision, fines, penalties, damages to
third parties, lost profits from loss of use and any hazardous waste liability
under applicable environmental law by reason of or arising out of the
violation of any applicable environmental law or the presence of hazardous
substances present in the soil or ground water on or under or about the
Premises while this Lease is in effect (including any renewals, extensions or
holdover periods). This obligation to indemnify, hold harmless and defend
shall survive termination of this Lease.
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EXHIBIT H
1. RENEWAL OPTION: Tenant shall have the right, privilege and option to
extend the term of this Lease for two (2) successive periods of five (5) years
under the same terms and conditions of this Lease then in effect except that
the economic lease terms for any option period shall equal 95% of "Fair Market
Rental Value" of the Premises as determined below. Tenant, if it elects to
exercise any option, shall do so by giving Landlord written notice of such
exercise at least one hundred eighty (180) days prior to the expiration of the
then existing term of this Lease. If Tenant timely exercises it option to
extend the term of this Lease as provided for in this paragraph, Landlord and
Tenant shall, within thirty (30) days thereafter, undertake their mutual good
faith and reasonable efforts to mutually agree in writing upon the fair market
rental value for the Premises which will be applicable during the particular
extension term for which Tenant shall have exercised its option (and such
mutually agreed upon fair market fixed rent shall be 95% of the "Fair Market
Rental Value" applicable to the determination of Monthly Rent for such
extended term). If Landlord and Tenant are unable to agree in writing upon the
fair market rental value of the Premises within such 30-day period, then,
within fifteen (15) days following the expiration of such 30-day period,
Landlord and Tenant shall each name a professional MAI appraiser, who shall be
a qualified, professional, licensed appraiser unaffiliated with either
Landlord or Tenant, and shall notify the other party in writing as to the
identity of such party's appraiser. The two appraisers thus appointed shall,
by agreement between them to be reached within ten (10) days following their
appointment, appoint a third appraiser, who shall also be a qualified,
professional licensed appraiser unaffiliated with Landlord, Tenant and/or such
two previously appointed appraisers, and the three appraisers so appointed
shall determine the Fair Market Rental Value of the Premises for the option
period in question. Within thirty (30) days of the appointment of such third
appraiser, the appraisers shall notify, in writing, both Landlord and Tenant
of their findings. If the three appraisers are unable to agree upon a
valuation, then the valuation agreed upon by any two of them shall be binding.
If none of the three appraisers thus selected are able to agree on the
valuation within such 30-day period, then the average of the valuations of the
two appraisers closest to each other shall be binding. Landlord and Tenant
shall each pay the cost of the appraiser appointed by them and shall each pay
one-half of the cost of the third appraiser.
2. TENANT'S SELF-HELP: Notwithstanding any contrary provision of this
Lease, Tenant shall be entitled (but not obligated) to make repairs and
perform maintenance which are Landlord's obligations, and to offset the cost
thereof against Monthly Rent, as follows:
(a) If Tenant provides written notice (the "Repair Notice") to
Landlord of an event or condition which pursuant to the terms of this Lease
requires Landlord to repair and/or maintain such event or condition the
Building or the Project (a "Required Action"), and Landlord fails to perform
the Required Action within the time period required by this Lease (or a
reasonable period of time, if no specific time period is specified in this
Lease) after the receipt of the Repair Notice, then Tenant may proceed to make
the Required Action, and shall deliver a second notice to Landlord specifying
that Tenant is taking the Required Action. Any Repair Notice delivered
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by Tenant shall describe with reasonable specificity the Required Action
Landlord is obligated to undertake.
(b) If any Required Action will affect the systems and equipment
located within the Building (the "Building Systems"), the structural integrity
of the Building, or the exterior appearance of the Building, Tenant shall use
only those contractors used by Landlord in the Building for work on the
Building Systems, or its structure, and Landlord shall provide Tenant (upon
Tenant's request) with notice identifying such contractors and any changes to
the list of such contractors, unless such contractors are unwilling or unable
to perform such work or the cost of such work is not competitive, in which
event Tenant may utilize the services of any other qualified contractors which
normally and regularly performs similar work on comparable buildings.
(c) If Tenant undertakes any Required Action pursuant to the terms
of this section, Landlord shall reimburse Tenant for its reasonable and
documented costs and expenses in taking the Required Action within thirty (30)
days after receipt by Landlord of an invoice from Tenant which sets forth a
reasonably detailed breakdown of its costs and expenses in connection with
taking the Required Action on behalf of Landlord. If Landlord fails to
reimburse Tenant within thirty (30) days of receipt of Tenant's invoice, then
Tenant may deduct from the next Monthly Rent payable by Tenant under this
Lease the amount set forth in Tenant's invoice, together with interest.
Notwithstanding the foregoing, if Landlord delivers to Tenant within thirty
(30) days after receipt of the Tenant's invoice a written objection to the
payment of such invoice, setting forth with reasonable particularity
Landlord's reason for its claim that the Required Action did not have to be
taken by Landlord pursuant to the terms of this Lease, or that Tenant breached
this section, or that the charges are excessive (in which case Landlord shall
pay the amount it contends would not have been excessive), then Tenant shall
not be entitled to deduct such amount from Rent unless and until such dispute
is resolved by agreement of the parties, arbitration or a final judgment of a
court of competent jurisdiction (any such resolution being referred to herein
as a "Binding Determination"). If such Binding Determination establishes that
Tenant is entitled to reimbursement for a Required Action and Landlord fails
to pay the full amount of such reimbursement (together with interest thereon
and any award of attorneys' fees) within thirty (30) days of the Binding
Determination, Tenant shall be entitled to set off such amount against Rent
thereafter becoming due under this Lease until Tenant has recovered the full
amount Landlord owes Tenant from Rent which otherwise would be due and payable
under this Lease. Tenant's right of set off under this section shall prevail
over any inconsistent provisions of this Lease, including, without limitation,
any provision which purports to limit a Project owner's liability for the
obligations of Landlord to those obligations accruing during the period of
ownership of the Project.
3. Occupancy: Tenant shall be permitted to take occupancy for purposes of
installing telecommunications equipment, systems furniture and computer
systems, or for general office purposes as permitted by the City of Austin on
March 1, 2000. Upon occupancy of the premises, Tenant shall be responsible for
Direct Expenses associated with the Project as set forth in Exhibit D upon the
initial occupancy date, provided that entry by Tenant to complete phone, data
and/or security cabling shall not be deemed to commence occupancy.
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4. SATELLITE DISH. Tenant shall be allowed to install multiple 24"
satellite communications dish in a location designated by Landlord (which
location shall be referred to as "Satellite Location"). Installation of a
satellite communication dish shall be coordinated through Landlord. Such
satellite communications dish shall remain in the Satellite Location
throughout the term of this Lease, including any extension thereof, with no
additional rent being charged to Tenant for the use of such space. Tenant is
hereby granted the right of access, with reasonable notice to Landlord, to the
Satellite Location at all reasonable times during the terms of this Lease to
repair, maintain or replace such satellite communications dish. Tenant
represents and warrants that when such satellite communications dish is
removed, Tenant will at all times repair or replace any damage which may have
been caused by the installation of the satellite communications dish and
return the Satellite Location to its original conditions, reasonable wear and
tear and damage by fire, other casualty or eminent domain excepted.
5. TITLE REQUIREMENT. Tenant acknowledges that Landlord has not obtained
title to the Project. Landlord shall provide notice on or before August 15,
2000 of Landlord's status regarding title. Notwithstanding any provision in
this Lease to the contrary, in the event Landlord does not obtain title or the
authority to fulfill Landlord's obligations set forth in the Lease prior to
September 17, 2000, then Tenant or Landlord will have the option to terminate
this Lease. Upon such termination, the Security Deposit shall be returned to
Tenant, and neither party shall have further rights or obligations under this
Lease. Landlord shall provide notice of Landlord's taking title, which ceases
such termination rights. In the event Landlord does not obtain title to
Project as set forth above, Landlord shall use best efforts to assign or
transfer Landlord's interest in the Project to Tenant.
6. RIGHT OF FIRST REFUSAL TO LEASE. Tenant shall have the following
rights: Tenant shall have a right of first refusal during lease term, if
exercised, to lease adjacent space identified in Exhibit H-1 which may become
available during term of this Lease, at the same rental rate per square foot
and upon the other terms and conditions offered by a third party and
acceptable to Landlord. At such time as a third party has offered to lease
space, Landlord shall give Tenant written notice of the terms and conditions
of such offer and the approximate leasable square footage contained in the
available space. Should Tenant fail to exercise its right to lease such
available space upon the terms and conditions offered by the third party
within ten (10) days after receipt of such notice from Landlord, then Landlord
shall have the right to lease such space to the third party upon the terms and
conditions presented to Tenant and Tenant shall have no further rights with
respect to that particular space until such time as it once again becomes
available for lease. This right will continue through the Term of this Lease
and any renewals, and following any assignment(s) thereof.
7. RIGHT OF FIRST REFUSAL TO PURCHASE. In the event Landlord receives an
acceptable offer to purchase the Project after Commencement of the Lease,
Landlord shall notify Tenant of such fact and shall include in such notice the
terms at which the Landlord is prepared to sell the Project to the prospective
purchaser(s). Tenant and Landlord shall have a period of five (5) business
days following Tenant's receipt of notice to notify Landlord whether Tenant
elects to exercise the
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right granted hereby to enter into a purchase and sale agreement to purchase
the Project upon the same terms and conditions as the proposed sale of the
Project to the prospective purchaser(s), as the case may be.
If Tenant waives its right to purchase the Project, Landlord shall have the
right to sell the Project to such prospective purchaser(s). This right will
continue through the Term of this Lease and any renewals, and following any
assignment(s) thereof.
Upon the exercise by Tenant of its Right of First Refusal as provided in this
Agreement, Landlord shall, within five (5) days after Tenant delivers written
notice to Landlord of its election, deliver to Tenant a written agreement for
the sale of such Project to Tenant, upon the same terms and conditions as
Landlord so notified Tenant pursuant to Section 1 above. Thereafter, Tenant
and Landlord shall negotiate in good faith to finalize such purchase and sale
agreement within five (5) days after the delivery of such purchase and sale
agreement to Tenant.
This Right of First Refusal shall terminate upon the earlier of the date that:
(i) a written mutual agreement of the parties to terminate is entered into;
(ii) the Project has been sold to a purchaser or (iii) ten (10) years from the
date hereof.
8. ADDITIONAL IMPROVEMENTS. Landlord agrees to construct additional
capital improvements on the Project including shell office space and parking
but excluding interior tenant improvements, subject to approval by applicable
regulatory authorities, space and land availability, Lender approval and
architectural review. The Annual Rental Rate associated with the improvements
("Additional Improvements") shall be equal to the Fair Market Rental Value, as
determined by the parties (provided that if the proposed improvements are to
be constructed for office space, then the Annual Rental Rate shall not be less
than the then current Annual Rental Rate with respect to the Premises). If
Landlord and Tenant are unable to agree in writing upon the fair market rental
value of the Premises within a 30-day period, then, within fifteen (15) days
following the expiration of such 30-day period, Landlord and Tenant shall each
name a professional MAI appraiser, who shall be a qualified, professional,
licensed appraiser unaffiliated with either Landlord or Tenant, and shall
notify the other party in writing as to the identity of such party's
appraiser. The two appraisers thus appointed shall, by agreement between them
to be reached within ten (10) days following their appointment, appoint a
third appraiser, who shall also be a qualified, professional licensed
appraiser unaffiliated with Landlord, Tenant and/or such two previously
appointed appraisers, and the three appraisers so appointed shall determine
the Fair Market Rental Value of the Premises. Within thirty (30) days of the
appointment of such third appraiser, the appraisers shall notify, in writing,
both Landlord and Tenant of their findings. If the three appraisers are unable
to agree upon a valuation, then the valuation agreed upon by any two of them
shall be binding. If none of the three appraisers thus selected are able to
agree on the valuation within such 30-day period, then the average of the
valuations of the two appraisers closest to each other shall be binding.
Landlord and Tenant shall each pay the cost of the appraiser appointed by them
and shall each pay one-half of the cost of the third appraiser.
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