EXHIBIT 10.17
LEASE AGREEMENT WITH JORDAN ASSOCIATES, INC.
LEASE
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THIS LEASE AGREEMENT (the "Lease") is entered into as of March 6, 1998,
between OKC REAL ESTATE INVESTMENTS, INC., a Delaware corporation ("Landlord"),
and JORDAN ASSOCIATES, INC., an Oklahoma corporation ("Tenant").
1. Lease Grant. Subject to the terms of this Lease, Landlord leases to
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Tenant, and Tenant leases from Landlord, the office space depicted on Exhibit
"A" attached hereto (the "Premises") which will be located in the office
building to be constructed by Landlord in Oklahoma City, Oklahoma, which is
described in Exhibit "B" attached hereto (the "Building"). The term "Building"
includes the related land, driveways, parking facilities, and similar
improvements. Landlord and Tenant agree that the Premises will consist of
approximately 25,000 rentable square feet, and that the Building will contain
approximately 50,000 rentable square feet.
2. Construction of Building. Landlord agrees to give Tenant periodic
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reports (not less than monthly) on the status of site acquisition, loan
processing and the actual construction of the Building from and after the date
hereof. Since the Tenant's current lease expires on September 30, 1998, Tenant
will use its best efforts to cause its current landlord to agree to allow its
occupancy to continue thereafter on a month-to-month basis given the timing
uncertainties associated with any construction project. Landlord will use its
best efforts to (a) enter into a binding contract for the acquisition of the
site for the Building on or before April 1, 1998, and (b) obtain an appropriate
loan commitment for the construction loan on or before April 1, 1998. If the
Landlord fails to acquire the site or obtain the loan commitment on or before
April 1, 1998, Tenant shall have the right to terminate this Lease by giving
Landlord a written termination notice on or before April 5, 1998. If the
Landlord fulfills the foregoing conditions on or before April 1, 1998, or
Landlord fails to fulfill the foregoing conditions on or before April 1, 1998
but Tenant does not terminate this Lease on or before April 5, 1998, this Lease
will remain in full force and effect, and Tenant shall have no further
termination rights pursuant to this Section 2. The parties acknowledge that the
Landlord will not incur any further architectural or engineering or other
material expenses in connection with the development of the Building until the
Tenant's termination rights as set forth in this Section 2 have terminated.
3. Term. The term of this Lease shall be one hundred twenty (120) months,
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commencing on substantial completion of the Building (the "Commencement Date"),
and expiring at 5:00 p.m., on the last day of the 120th month thereafter (the
"Term", which definition shall include all renewals of the initial Term). If the
Commencement Date is not the first day of a calendar month, then the Term shall
be extended by the number of days between the Commencement Date and the first
day of the next month. If the Premises are ready for occupancy prior to the
Commencement Date, the Commencement Date shall refer to the date of the Tenant's
initial occupancy of the Premises, provided that Tenant will be given access to
the Premises prior to its actual occupancy to prepare the Premises for
occupancy, including installation of telephone and computer systems and
relocating its furniture, fixtures and equipment.
4. Rent.
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(a) Basic Rent. "Basic Rent" (herein so called) shall be the following
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amounts for the following periods of time:
Time Period Monthly Basic Rent Rent per Rentable Square Foot
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Months 1-60 $24,542.00 $11.78
Months 61-120 $27,667.00 $13.28
(b) Payment. Tenant shall timely pay to Landlord Basic Rent and all
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additional sums to be paid by Tenant to Landlord under this Lease (collectively,
the "Rent"), without deduction or set off, at Landlord's address provided for in
this Lease or as otherwise specified by Landlord. Basic Rent, adjusted as herein
provided, shall be payable monthly in advance, and shall be accompanied by all
applicable state and local sales or use taxes. Basic Rent shall be payable on
the first day of each month beginning on the Commencement Date. The monthly
Basic Rent for any partial month at the beginning of the Term shall equal the
product of 1/365 of the annual Basic Rent in effect during the partial month and
the number of days in the partial month from and after the Commencement Date,
and shall be due on the Commencement Date.
(c) Triple Net Lease. The Basic Rent shall be net to Landlord and all
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costs, expenses, and charges of every kind and nature relating to the Premises
(excepting only items which the Landlord specifically agrees to pay in this
Lease) which may arise or become due and payable during the term of this Lease
shall be paid by Tenant.
5. Delinquent Payment; Handling Charges. All past due payments required
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of Tenant hereunder shall bear interest from the date due until paid at the
maximum lawful rate of interest; alternatively, Landlord may charge Tenant a fee
equal to 5% of the delinquent payment to reimburse Landlord for its cost and
inconvenience incurred as a consequence of Tenant's delinquency. In no event,
however, shall the charges permitted under this Section 5 or elsewhere in this
Lease, to the extent they are considered to be interest under law, exceed the
maximum lawful rate of interest.
6. Security Deposit. On April 15, 1998, Tenant shall pay to Landlord
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$25,000 (the "Security Deposit"), which shall be held by Landlord to secure
Tenant's performance of its obligations under this Lease. The Security Deposit
is not an advance payment of Rent or a measure or limit of Landlord's damages
upon an Event of Default (defined in Section 17). Landlord may, from time to
time and without prejudice to any other remedy, use all or a part of the
Security Deposit to perform any obligation Tenant fails to perform
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hereunder after notice of nonperformance is given to Tenant as required in
Section 17 hereof. Following any such application of the Security Deposit,
Tenant shall pay to Landlord within ten (10) days the amount so applied in order
to restore the Security Deposit to its original amount. Provided that Tenant has
performed all of its obligations hereunder, Landlord shall, within 30 days after
the Term ends, return to Tenant the portion of the Security Deposit which was
not applied to satisfy Tenant's obligations. The Security deposit may be
commingled with other funds, and no interest shall be paid thereon. If Landlord
transfers its interest in the Premises and the transferee assumes Landlord's
obligations under this Lease, then Landlord may assign the Security Deposit to
the transferee and Landlord thereafter shall have no further liability for the
return of the Security Deposit.
7. Operating Expense Payments. During each month of the Term, on the
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same date that Basic Rent is due, Tenant shall pay Landlord an amount equal to
1/12 of the annual cost, as estimated by Landlord on an annual basis, of
Tenant's Proportionate Share (hereinafter defined) of Operating Expenses for the
Building. Tenant shall also (a) pay directly all utility charges associated
with the Premises (which will be separately metered) and, (b) pay directly, and
contract for, janitorial services for the Premises with a contractor, and on
terms, acceptable to Landlord. The Landlord's estimate for the Operating
Expenses for the first year of the Building's operation is attached hereto as
Exhibit "F", provided Tenant acknowledges that the Operating Expenses for the
Building are dependent upon many factors beyond the control of Landlord, and
Tenant will pay its Proportionate Share of the actual costs. Payments thereof
for any fractional calendar month shall be prorated. The term "Operating
Expenses" means all reasonable costs and expenses incurred by Landlord with
respect to the ownership, maintenance, and operation of the Building including,
but not limited to costs of: taxes and fees payable to tax consultants and
attorneys for consultation and contesting taxes; insurance; common area
utilities; association dues; snow removal; maintenance and repair of all
portions of the Building, including without limitation, paving and parking
areas, roads, roofs, alleys, and driveways, mowing, landscaping, exterior
painting, utility lines and mechanical systems; amounts paid to contractors and
subcontractors for work or services performed in connection with any of the
foregoing; charges or assessments of any association to which the Building is
subject; property management fees payable to a property manager, including any
affiliate of Landlord, or if there is no property manager, an administration fee
payable to Landlord which shall not exceed the level of the management fees
reflected in Exhibit "F" attached hereto; security services, if any; trash
collection, sweeping and removal; and additions or alterations made by Landlord
to the Building in order to comply with applicable laws or codes as amended from
time to time or that are appropriate for the continued operation of the Building
as an office building in the market area, provided that the cost of such
additions or alterations that are required to be capitalized for federal income
tax purposes shall be amortized on a straight line basis over a period equal to
the lesser of the useful life thereof for federal income tax purposes or 10
years. Operating Expenses shall not include debt service under mortgages or
ground rent under ground leases, costs of restoration to the extent of net
insurance proceeds received by Landlord with respect thereto, leasing
commissions, or the costs of renovating space for tenants.
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The Operating Expenses will be reconciled by Landlord on an annual basis.
If Tenant's total payments for any year are less than Tenant's Proportionate
Share of actual Operating Expenses for such year, Tenant shall pay the
difference to Landlord within 30 days after written notice thereof. If the
total payments of Tenant for any year are more than Tenant's Proportionate Share
of actual Operating Expenses for such year, Landlord shall refund the difference
to Tenant within thirty (30) days after the annual reconciliation is completed.
Tenant shall have the right to review the supporting information compiled by and
relied upon by Landlord in calculating Operating Expenses and Tenant's
Proportionate Share thereof. For purposes of calculating Tenant's Proportionate
Share of Operating Expenses, a year shall mean a calendar year except the first
year, which shall begin on the Commencement Date, and the last year, which shall
end on the expiration of this Lease. Tenant's "Proportionate Share" shall be
fifty percent (50%) as reasonably adjusted by Landlord in the future for changes
in the physical size of the Premises or the Building. Landlord may equitably
increase Tenant's Proportionate Share for any item of expense or cost
reimbursable by Tenant that relates to a repair, replacement, or service that
benefits only the Premises or only a portion of the Building that includes the
Premises or that varies with the occupancy of the Building, provided Landlord
will give Tenant written notice prior to effectuating any such increase.
8. Improvements: Alterations: Repairs: Maintenance.
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(a) Improvements: Alterations. Improvements to the Premises shall be
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installed at Tenant's expense only in accordance with plans and specifications
which have been previously submitted to and approved in writing by Landlord. No
alterations or physical additions in or to the Premises may be made without
Landlord's prior written consent, which shall not be unreasonably withheld or
delayed; however, Landlord may withhold its consent to any alteration or
addition that would affect the Building's structure or its HVAC, plumbing,
electrical, or mechanical systems. Excluding ordinary course decorative
activities associated with the interior portion of the Premises, Tenant shall
not paint or install lighting or decorations, signs, window or door lettering,
or advertising media of any type on or about the Premises without the prior
written consent of Landlord, which shall not be unreasonably withheld or
delayed; however, Landlord may withhold its consent to any such painting or
installation which would affect the appearance of the exterior of the Building
or of any common areas of the Building. All alterations, additions, or
improvements made in or upon the Premises shall, at Landlord's option, either be
removed by Tenant prior to the end of the Term (and Tenant shall repair all
damage caused thereby), or shall remain on the Premises at the end of the Term
without compensation to Tenant. All alterations, additions, and improvements
shall be constructed, maintained, and used by Tenant, at its risk and expense,
in accordance with all laws. Landlord's approval of the plans and
specifications therefor shall not be a representation by Landlord that such
alterations, additions, or improvements comply with any law.
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(b) Repairs; Maintenance. Tenant shall maintain the Premises in a clean,
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safe, and operable condition, and shall not permit or allow to remain any waste
or damage to any portion of the Premises. Tenant shall repair or replace,
subject to Landlord's direction and supervision, any damage to the Building
caused by Tenant, Tenant's transferees, or their respective agents, contractors,
or invitees. If Tenant fails to make such repairs or replacements after notice
of nonperformance is given to Tenant as required in Section 17 hereof, then
Landlord may make the same at Tenant's cost. If any such damage occurs outside
of the Premises, then Landlord may elect to repair such damage at Tenant's
expense, rather than having Tenant repair such damage. The cost of all repair or
replacement work performed by Landlord under this Section 8 shall be paid by
Tenant to Landlord within fifteen days after Landlord has invoiced Tenant
therefor.
(c) Performance of Work. All work described in this Section 8 shall be
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performed only by Landlord or by contractors and subcontractors approved in
writing by Landlord. Tenant shall cause all contractors and subcontractors to
procure and maintain insurance coverage naming Landlord as an additional insured
against such risks, in such amounts, and with such companies as Landlord may
reasonably require. All such work shall be performed in accordance with all
legal requirements and in a good and workmanlike manner so as not to damage the
Premises, the Building, or the components thereof. Except as otherwise set
forth herein, in no event shall Landlord be liable for any defects in the
Premises or for any limitation on its use.
(d) Mechanic's Liens. Tenant shall not permit any mechanic's liens to be
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filed against the Premises or the Building for any work performed, materials
furnished, or obligation incurred by or at the request of Tenant. If such a lien
is filed, then Tenant shall, within ten (10) days after Landlord has delivered
notice of the filing thereof to Tenant, either pay the amount of the lien or
diligently contest such lien and deliver to Landlord a bond or other security
reasonably satisfactory to Landlord. If Tenant fails to timely take either such
action, then Landlord may pay the lien claim or bond around the lien and invoice
Tenant for the cost thereof, and any amounts so paid, including expenses and
interest, shall be paid by Tenant to Landlord within ten days after Landlord has
invoiced Tenant therefor.
9. Use. Tenant shall continuously occupy and use the Premises only for
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general office use (the "Permitted Use") and shall comply with all laws, orders,
rules, and regulations relating to the use, condition, access to, and occupancy
of the Premises. The Premises shall not be used for any use which is
disreputable or creates extraordinary fire hazards. Without the Landlord's
written consent, the Premises shall not be used for any use which results in an
increased rate of insurance on the Building or its contents, or for the storage
of any hazardous materials or substances, provided, however, that Landlord
acknowledges that spray mount adhesive, lacquer thinner and Bestine are used in
the ordinary course of Tenant's business. Tenant agrees that the quantities of
the referenced materials located in the Premises shall not exceed the following:
(a) forty-eight (48) cans
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of spray mount adhesive which are each twelve (12) ounces or less; (b) two (2)
gallons of lacquer thinner; and (c) five (5) gallons of Bestine. Tenant further
agrees to indemnify the Landlord from and against any and all damages and
liabilities of any type incurred by the Landlord or the Building as a result of
such use by Tenant. If, because of Tenant's acts, the rate of insurance on the
Building or its contents increases, then Tenant shall pay to Landlord the amount
of such increase on demand. Tenant shall conduct its business and control its
agents, employees, and invitees in such a manner as not to create any nuisance
or unreasonably interfere with other tenants or Landlord in its management of
the Building, including nuisances associated with the use of spray mount
adhesive, lacquer thinner and Bestine. Tenant, at its sole expense, shall comply
with all laws (including, without limitation, any and all environmental rules,
regulations and requirements, and all 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,
including those pertaining to the use of spray mount adhesive, lacquer thinner
and Bestine. Outside storage, including, without limitation, storage of trucks
and other vehicles, is prohibited without Landlord's prior written consent. No
use shall be made of the Premises that would constitute the Building as a place
of public accommodation under the Americans with Disabilities Act or similar
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 improvements to the Premises, the
Building) to comply with the ADA.
10. Assignment and Subletting.
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(a) Transfers; Consent. Tenant shall not, without the prior written
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consent of Landlord, (1) assign, transfer, or encumber this Lease or any estate
or interest herein, whether directly or by operation of law, (2) permit any
other entity to become Tenant hereunder by merger, consolidation, or other
reorganization, (3) if Tenant is an entity other than a corporation whose stock
is publicly traded, permit the transfer of an ownership interest in Tenant so as
to result in a change in the current control of Tenant, (4) sublet any portion
of the Premises, (5) grant any license, concession, or other right of occupancy
of any portion of the Premises, or (6) permit the use of the Premises by any
parties other than Tenant (any of the events listed in Section 10.(a)(1) through
10.(a)(6) being a "Transfer"). If Tenant requests Landlord's consent to a
Transfer, then Tenant shall provide Landlord with a written description of all
terms and conditions of the proposed Transfer, copies of the proposed
documentation, and the following information about the proposed transferee: name
and address; reasonably satisfactory information about its business and business
history; its proposed use of the Premises; banking, financial, and other credit
information; and general references sufficient to enable Landlord to determine
the proposed transferee's creditworthiness and character. Landlord shall not
unreasonably withhold its consent to any assignment or subletting of the
Premises, provided that the proposed
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transferee (A) is creditworthy, (B) has a good reputation in the business
community, (C) does not engage in business similar to those of other tenants in
the Building, and (D) is not another occupant of the Building; otherwise,
Landlord may withhold its consent in its sole discretion. Concurrently with
Tenant's notice of any request for consent to a Transfer, Tenant shall pay to
Landlord a fee of $350.00 to defray Landlord's expenses in reviewing such
request, and Tenant shall also reimburse Landlord immediately upon request for
its attorneys' fees incurred in connection with considering any request for
consent to a Transfer. If Landlord consents to a proposed Transfer, then the
proposed transferee shall deliver to Landlord a written agreement whereby it
expressly assumes the Tenant's obligations hereunder; however, any transferee of
less than all of the space in the Premises shall be liable only for obligations
under this Lease that are properly allocable to the space subject to the
Transfer for the period of the Transfer. Landlord's consent to a Transfer shall
not release Tenant from its obligations under this Lease, but rather Tenant and
its transferee shall be jointly and severally liable therefor. Landlord's
consent to any Transfer shall not waive Landlord's rights as to any subsequent
Transfers. If an Event of Default occurs while the Premises or any part thereof
are subject to a Transfer, then Landlord, in addition to its other remedies, may
collect directly from such transferee all rents becoming due to Tenant and apply
such rents against Rent. Tenant authorizes its transferees to make payments of
rent directly to Landlord upon receipt of notice from Landlord to do so.
(b) Cancellation. Landlord may, within 30 days after submission of
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Tenant's written request for Landlord's consent to an assignment or subletting,
cancel this Lease as to the portion of the Premises proposed to be sublet or
assigned as of the date the proposed Transfer is to be effective. If Landlord
cancels this Lease as to any portion of the Premises, then this Lease shall
cease for such portion of the Premises and Tenant shall pay to Landlord all Rent
accrued through the cancellation date relating to the portion of the Premises
covered by the proposed Transfer. Thereafter, Landlord may lease such portion of
the Premises to the prospective transferee (or to any other person) without
liability to Tenant.
(c) Additional Compensation. Tenant shall pay to Landlord, immediately
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upon receipt thereof, the excess of (1) all compensation received by Tenant for
a Transfer less the costs reasonably incurred by Tenant with unaffiliated third
parties in connection with such Transfer (i.e., brokerage commissions, tenant
finish work, and the like) over (2) the Rent allocable to the portion of the
Premises covered thereby.
11. Insurance; Waivers; Subrogation; Indemnity.
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(a) Insurance. Tenant shall maintain throughout the Term the following
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insurance policies: (1) comprehensive general liability insurance in amounts of
$1,000,000 per occurrence with $2,000,000 in the aggregate or such other amounts
as Landlord may from time to time reasonably require, insuring Tenant, Landlord,
Landlord's agents and
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their respective affiliates against all liability for injury to or death of a
person or persons or damage to property arising from the use and occupancy of
the Premises, (2) casualty insurance for the full replacement cost of the
Building, (3) insurance covering the full value of Tenant's property and
improvements, and other property (including property of others) in the Premises,
(4) contractual liability insurance sufficient to cover Tenant's indemnity
obligations hereunder, (5) worker's compensation insurance, and (6) business
interruption insurance. Tenant's insurance shall provide primary coverage to
Landlord when any policy issued to Landlord provides duplicate or similar
coverage, and in such circumstance Landlord's policy will be excess over
Tenant's policy. Tenant shall furnish to Landlord certificates of such insurance
and such other evidence satisfactory to Landlord of the maintenance of all
insurance required hereunder, and Tenant shall obtain a written obligation on
the part of each insurance company to notify Landlord at least 30 days before
cancellation or a material change of any such insurance policies. All such
insurance policies shall be in form, and issued by companies, reasonably
satisfactory to Landlord. The term "affiliate" shall mean any person or entity,
directly or indirectly, controlling, controlled by, or under common control with
the party in question.
(b) Waiver of Negligence; No Subrogation. Landlord and Tenant each waives
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any claim it might have against the other for any injury to or death of any
person or persons or damage to or theft, destruction, loss, or loss of use of
any property (a "Loss"), to the extent the same is insured against under any
insurance policy that covers the Building, the Premises, Landlord's or Tenant's
fixtures, personal property, leasehold improvements, or business, or, in the
case of Tenant's waiver, is required to be insured against under the terms
hereof, regardless of whether the negligence of the other party caused such
loss. Each party shall cause its insurance carrier to endorse all applicable
policies waiving the carrier's rights of recovery under subrogation or otherwise
against the other party.
(c) Indemnity. Subject to Section 11.(b), Tenant shall defend, indemnify,
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and hold harmless Landlord and its representatives and agents from and against
all claims, demands, liabilities, causes of action, suits, judgments, damages,
and expenses (including attorneys' fees) arising from (i) any Loss arising from
any occurrence on the Premises or (ii) Tenant's failure to perform its
obligations under this Lease, even though caused or alleged to be caused by the
negligence or fault of Landlord or its agents (other than a Loss arising from
the sole or gross negligence of Landlord or its agents), and even though any
such claim, cause of action, or suit is based upon or alleged to be based upon
the strict liability of Landlord or its agents. This indemnity is intended to
indemnify Landlord and its agents against the consequences of their own
negligence when Landlord or its agents are jointly, comparatively,
contributively, or concurrently negligent with Tenant. This indemnity provision
shall survive termination or expiration of this Lease. If any proceeding is
filed for which indemnity is required hereunder, Tenant agrees, upon request
therefor, to defend the indemnified party in such proceeding at its sole cost
utilizing counsel satisfactory to the indemnified party.
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12. Subordination Attornment: Notice to Landlord's Mortgagee.
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(a) Subordination. This Lease shall be subordinate to any deed of trust,
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mortgage, or other security instrument, or any ground lease, master lease, or
primary lease, that now or hereafter covers all or any part of the Premises (the
mortgagee under any such mortgage or the lessor under any such lease is referred
to herein as a "Landlord's Mortgagee"). Any Landlord's Mortgagee may elect, at
any time, unilaterally, to make this Lease superior to its mortgage, ground
lease, or other interest in the Premises by so notifying Tenant in writing.
(b) Attornment. Tenant shall attorn to any party succeeding to Landlord's
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interest in the Premises, whether by purchase, foreclosure, deed in lieu of
foreclosure, power of sale, termination of lease, or otherwise, upon such
party's request, and shall execute such agreements confirming such attornment as
such party may reasonably request.
(c) Notice to Landlord's Mortgagee. Tenant shall not seek to enforce any
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remedy it may have for any default on the part of the Landlord without first
giving written notice by certified mail, return receipt requested, specifying
the default in reasonable detail, to any Landlord's Mortgagee whose address has
been given to Tenant, and affording such Landlord's Mortgagee a reasonable
opportunity to perform Landlord's obligations hereunder.
13. Rules and Regulations. Tenant shall comply with the rules and
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regulations of the Building which are attached hereto as Exhibit C. Landlord
may, from time to time, change such rules and regulations for the safety, care,
or cleanliness of the Building and related facilities, provided Tenant is given
written notice thereof, all the changes are applicable to all tenants of the
Building and the changes will not unreasonably interfere with Tenant's use of
the Premises. Tenant shall be responsible for the compliance with such rules and
regulations by its employees, agents, and invitees.
14. Condemnation.
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(a) Total Taking - Tenant's Rights. If the entire Building or Premises
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are taken by right of eminent domain or conveyed in lieu thereof (a "Taking"),
this Lease shall terminate as of the date of the Taking.
(b) Partial Taking - Tenant's Rights. If any part of the Building becomes
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subject to a Taking and such Taking will prevent Tenant from conducting its
business in the Premises in a manner reasonably comparable to that conducted
immediately before such Taking for a period of more than 150 days, then Tenant
may terminate this Lease as of the date of such Taking by giving written notice
to Landlord within 30 days after the Taking, and Rent shall be apportioned as of
the date of such Taking. If Tenant does not terminate
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this Lease, then Rent shall be abated on a reasonable basis as to that portion
of the Premises rendered untenantable by the Taking.
(c) Partial Taking - Landlord's Rights. If any material portion, but less
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than all, of the Building becomes subject to a Taking, or if Landlord is
required to pay any of the proceeds received for a Taking to a Landlord's
Mortgagee, then Landlord may terminate this Lease by delivering written notice
thereof to Tenant within 30 days after such Taking, and Rent shall be
apportioned as of the date of such Taking. If Landlord does not so terminate
this Lease, then this Lease will continue, but if any portion of the Premises
has been taken, Rent shall xxxxx as provided in the last sentence of Section
14.(b).
(d) Award. If any Taking occurs, then Landlord shall receive the entire
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award or other compensation for the land on which the Building is situated, the
Building, and other improvements taken, and Tenant may separately pursue a claim
(to the extent it will not reduce Landlord's award) against the condemnor for
the value of Tenant's personal property which Tenant is entitled to remove under
this Lease, moving costs, loss of business, and other claims it may have.
15. Fire or Other Casualty.
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(a) Repair Estimate. If the Premises or the Building are damaged by fire
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or other casualty (a "Casualty"), Landlord shall, within 75 days after such
Casualty, deliver to Tenant a good faith estimate (the "Damage Notice") of the
time needed to repair the damage caused by such Casualty.
(b) Landlord's and Tenant's Rights. If a material portion of the Premises
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or the Building is damaged by Casualty such that Tenant is prevented from
conducting its business in the Premises in a manner reasonably comparable to
that conducted immediately before such Casualty and Landlord estimates that the
damage caused thereby cannot be repaired within 240 days after the Casualty,
then Tenant may terminate this Lease by delivering written notice to Landlord of
its election to terminate within 30 days after the Damage Notice has been
delivered to Tenant. If Tenant does not so timely terminate this Lease, then
(subject to Section 15.(c)) Landlord shall repair the Building or the Premises,
as the case may be, as provided below, and Rent for the portion of the Premises
rendered untenantable by the damage shall be abated on a reasonable basis from
the date of damage until the completion of the repair, unless Tenant caused such
damage, in which case, Tenant shall continue to pay Rent without abatement.
(c) Landlord's Rights. If a Casualty damages a material portion of the
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Building, and Landlord makes a good faith determination that restoring the
Premises would be uneconomical, or if Landlord is required to pay any insurance
proceeds arising out of the Casualty to a Landlord's Mortgagee, then Landlord
may terminate this Lease by giving
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written notice of its election to terminate within 30 days after the Damage
Notice has been delivered to Tenant, and Rent shall be abated as of the date of
the Casualty.
(d) Repair Obligation. If neither party elects to terminate this Lease
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following a Casualty, then Landlord shall, within a reasonable time after such
Casualty, begin to repair the Building and the Premises and shall proceed with
reasonable diligence to restore the Building and Premises to substantially the
same condition as they existed immediately before such Casualty; however,
Landlord shall not be required to repair or replace any of the furniture,
equipment, fixtures, and other improvements which may have been placed by, or at
the request of, Tenant or other occupants in the Building or the Premises, and
Landlord's obligation to repair or restore the Building or Premises shall be
limited to the extent of the insurance proceeds actually received by Landlord
for the Casualty in question.
16. Taxes. Tenant shall be liable for all taxes levied or assessed
-----
against personal property, furniture, or fixtures placed by Tenant in the
Premises. If any taxes for which Tenant is liable are levied or assessed against
Landlord or Landlord's property and Landlord elects to pay the same, or if the
assessed value of Landlord's property is increased by inclusion of such personal
property, furniture or fixtures and Landlord elects to pay the taxes based on
such increase, then Tenant shall pay to Landlord, upon demand, the part of such
taxes for which Tenant is primarily liable hereunder; however, Landlord shall
not pay such amount if Tenant notifies Landlord that it will contest the
validity or amount of such taxes before Landlord makes such payment, and
thereafter diligently proceeds with such contest in accordance with law and if
the non-payment thereof does not pose a threat of loss or seizure of the
Building or interest of Landlord therein.
17. Events of Default. Each of the following occurrences shall be an
-----------------
"Event of Default":
(a) Tenant's failure to pay Rent on or before the applicable due date and
on or before the 5th day after Landlord has delivered written notice to Tenant
that the same is past due;
(b) Tenant's failure to perform, comply with, or observe any other
agreement or obligation of Tenant under this Lease and the continuance of such
failure for a period of more than 30 days after Landlord has delivered to Tenant
written notice thereof, provided that if the default is of such a nature that it
may not be reasonably cured within 30 days, then no Event of Default shall occur
hereunder if Tenant commences curing within such 30-day period and thereafter
diligently and continuously pursues such cure to completion within a period of
not more than 90 days after the delivery of such notice; and
(c) The filing of a petition by or against Tenant (the term "Tenant" shall
include, for the purpose of this Section 17.(c), any guarantor of the Tenant's
obligations hereunder)
11
(1) in any bankruptcy or other insolvency proceeding; (2) seeking any relief
under any state or federal debtor relief law; (3) for the appointment of a
liquidator or receiver for all or substantially all of Tenant's property or for
Tenant's interest in this Lease; or (4) for the reorganization or modification
of Tenant's capital structure; however, if such a petition is filed against
Tenant, then such filing shall not be an Event of Default unless Tenant fails to
have the proceedings initiated by such petition dismissed within 90 days after
the filing thereof.
18. Remedies. Upon any Event of Default, Landlord may, in addition to all
--------
other rights and remedies afforded Landlord hereunder or by law or equity, take
any of the following actions:
(a) Terminate this Lease by giving Tenant written notice thereof, in which
event Tenant shall pay to Landlord the sum of (1) all Rent accrued hereunder
through the date of termination, (2) all amounts due under Section 19.(a), and
(3) an amount equal to (A) the total Rent that Tenant would have been required
to pay for the remainder of the Term discounted to present value at a per annum
rate equal to the "Prime Rate" as published on the date this Lease is terminated
by The Wall Street Journal, Southwest Edition, in its listing of "Money Rates"
minus one percent, times (B) 75%;
(b) Terminate Tenant's right to possess the Premises without terminating
this Lease by giving written notice thereof to Tenant, in which event Tenant
shall pay to Landlord (1) all Rent and other amounts accrued hereunder to the
date of termination of possession, (2) all amounts due from time to time under
Section 19.(a), and (3) all Rent and other net sums required hereunder to be
paid by Tenant during the remainder of the Term, diminished by any net sums
thereafter received by Landlord through reletting the Premises during such
period, after deducting all costs incurred by Landlord in reletting the
Premises. Landlord shall use reasonable efforts to relet the Premises on such
terms as Landlord in its sole discretion may determine (including a term
different from the Term, rental concessions, and alterations to, and improvement
of, the Premises); however, Landlord shall not be obligated to relet the
Premises before leasing other portions of the Building. Landlord shall not be
liable for, nor shall Tenant's obligations hereunder be diminished because of,
Landlord's failure to relet the Premises or to collect rent due for such
reletting. Tenant shall not be entitled to the excess of any consideration
obtained by reletting over the Rent due hereunder. Reentry by Landlord in the
Premises shall not affect Tenant's obligations hereunder for the unexpired Term;
rather, Landlord may, from time to time, bring an action against Tenant to
collect amounts due by Tenant, without the necessity of Landlord's waiting until
the expiration of the Term. Unless Landlord delivers written notice to Tenant
expressly stating that it has elected to terminate this Lease, all actions taken
by Landlord to dispossess or exclude Tenant from the Premises shall be deemed to
be taken under this Section 18.(b). If Landlord elects to proceed under this
Section 18.(b), it may at any time elect to terminate this Lease under Section
18.(a).
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19. Payment by Tenant: Non-Waiver.
-----------------------------
(a) Payment by Tenant. Upon any Event of Default, Tenant shall pay to
-----------------
Landlord all costs incurred by Landlord (including court costs and reasonable
attorneys' fees and expenses) in (1) obtaining possession of the Premises, (2)
removing and storing Tenant's or any other occupant's property, (3) repairing,
restoring, altering, remodeling, or otherwise putting the Premises into
condition acceptable to a new tenant, (4) if Tenant is dispossessed of the
Premises and this Lease is not terminated, reletting all or any part of the
Premises (including brokerage commissions, cost of tenant finish work, and other
costs incidental to such reletting), (5) performing Tenant's obligations which
Tenant failed to perform, and (6) enforcing, or advising Landlord of, its
rights, remedies, and recourses arising out of the Event of Default. To the full
extent permitted by law, Landlord and Tenant agree the federal and state courts
of Oklahoma shall have exclusive jurisdiction over any matter relating to or
arising from this Lease and the parties' rights and obligations under this
Lease.
(b) No Waiver. Landlord's acceptance of Rent following an Event of
---------
Default shall not waive Landlord's rights regarding such Event of Default. No
waiver by Landlord of any violation or breach of any of the terms contained
herein shall waive Landlord's rights regarding any future violation of such
term. Landlord's acceptance of any partial payment of Rent shall not waive
Landlord's rights with regard to the remaining portion of the Rent that is due,
regardless of any endorsement or other statement on any instrument delivered in
payment of Rent or any writing delivered in connection therewith; accordingly,
Landlord's acceptance of a partial payment of rent shall not constitute an
accord and satisfaction of the full amount of the Rent that is due.
20. Landlord's Lien. In addition to the statutory landlord's lien, Tenant
---------------
grants to Landlord, to secure performance of Tenant's obligations hereunder, a
security interest in all goods (including equipment and inventory), fixtures,
and other personal property of Tenant situated on the Premises, and all proceeds
thereof (the "Collateral"), and the Collateral shall not be removed from the
Premises without the prior written consent of Landlord (other than in Tenant's
ordinary course of business) until all obligations of Tenant have been fully
performed. Upon the occurrence of an Event of Default, Landlord may, in addition
to all other remedies, without notice or demand except as provided below,
exercise the rights afforded to a secured party under the Oklahoma Uniform
Commercial Code (the "UCC"). To the extent the UCC requires Landlord to give to
Tenant notice of any act or event and such notice cannot be validly waived
before a default occurs, then five-days' prior written notice thereof shall be
reasonable notice of the act or event. Tenant grants to Landlord a power of
attorney to execute and file any financing statement or other instrument
necessary to perfect Landlord's security interest under this Section 20, which
power is coupled with an interest and is irrevocable during the Term. Landlord
may also file a copy of this Lease as a financing statement to perfect its
security interest in the Collateral. Landlord agrees to subordinate its lien to
liens granted by Tenant to third party
13
lenders from time to time for any and all equipment obtained by Tenant from and
after the date hereof so long as there is no material adverse change in the
Tenant's financial condition from and after the date hereof.
21. Surrender of Premises. No act by Landlord shall be deemed an
---------------------
acceptance of a surrender of the Premises, and no agreement to accept a
surrender of the Premises shall be valid unless it is in writing and signed by
Landlord. At the expiration or termination of this Lease, Tenant shall deliver
to Landlord the Premises with all improvements located therein in good repair
and condition, broom-clean, reasonable wear and tear (and condemnation and
Casualty damage not caused by Tenant, as to which Sections 14 and 15 shall
control) excepted, and shall deliver to Landlord all keys to the Premises.
Provided that Tenant has performed all of its obligations hereunder, Tenant may
remove all unattached trade fixtures, furniture, and personal property placed in
the Premises by Tenant, and shall remove such alterations, additions,
improvements, trade fixtures, personal property, equipment, wiring, and
furniture as Landlord may request. Tenant shall repair all damage caused by such
removal. All items not so removed shall be deemed to have been abandoned by
Tenant and may be appropriated, sold, stored, destroyed, or otherwise disposed
of by Landlord without notice to Tenant and without any obligation to account
for such items. The provisions of this Section 21 shall survive the end of the
Term.
22. Holding Over. If Tenant fails to vacate the Premises at the end of
------------
the Term, then Tenant shall be a tenant at will and, in addition to all other
damages and remedies to which Landlord may be entitled for such holding over,
Tenant shall pay, in addition to the other Rent, a daily Basic Rent equal to the
greater of (A) 150% of the daily Basic Rent payable during the last month of the
Term, or (B) 125% of the prevailing rental rate in the Building for similar
space.
23. Certain Rights Reserved by Landlord. Provided that the exercise of
-----------------------------------
such rights does not unreasonably interfere with Tenant's occupancy of the
Premises, Landlord shall have the following rights:
(a) To decorate and to make inspections, repairs, alterations, additions,
changes, or improvements, whether structural or otherwise, in and about the
Building, or any part thereof; to enter upon the Premises and, during the
continuance of any such work, to temporarily close doors, entryways, public
space, and corridors in the Building; to interrupt or temporarily suspend
Building services and facilities; to change the name of the Building subject to
Tenant's rights as described in Section 24(t) hereof; and to change the
arrangement and location of entrances or passageways, doors, and doorways,
corridors, elevators, stairs, restrooms, or other public parts of the Building;
(b) To take such reasonable measures as Landlord deems advisable for the
security of the Building and its occupants; evacuating the Building for cause,
suspected cause, or for drill purposes; temporarily denying access to the
Building; and closing the
14
Building after normal business hours and on Sundays and holidays, subject,
however, to Tenant's right to enter when the Building is closed after normal
business hours under such reasonable regulations as Landlord may prescribe from
time to time; and
(c) To enter the Premises at reasonable hours with reasonable advance
notice to the Tenant to show the Premises to prospective purchasers, lenders,
or, during the last 12 months of the Term, tenants.
24. Miscellaneous.
-------------
(a) Landlord Transfer. Landlord may transfer any portion of the Building
-----------------
and any of its rights under this Lease. If Landlord assigns its rights under
this Lease, then Landlord shall thereby be released from any further obligations
hereunder, provided that the assignee assumes Landlord's obligations hereunder
in writing.
(b) Landlord's Liability. The liability of Landlord to Tenant for any
--------------------
default by Landlord under the terms of this Lease shall be recoverable only from
the interest of Landlord in the Building, and Landlord shall not be personally
liable for any deficiency. This Section shall not limit any remedies which
Tenant may have for Landlord's defaults which do not involve the personal
liability of Landlord.
(c) Force Majeure. Other than for Tenant's obligations under this Lease
-------------
that can be performed by the payment of money (e.g., payment of Rent and
maintenance of insurance), whenever a period of time is herein prescribed for
action to be taken by either party hereto, such party shall not be liable or
responsible for, and there shall be excluded from the computation of any such
period of time, any delays due to strikes, riots, acts of God, shortages of
labor or materials, war, governmental laws, regulations, or restrictions, or any
other causes of any kind whatsoever which are beyond the control of such party.
(d) Brokerage. Neither Landlord nor Tenant has dealt with any broker or
---------
agent in connection with the negotiation or execution of this Lease, other than
Xxxxxxxx Xxxx MW, Inc. whose commission shall be paid by Landlord. Tenant and
Landlord shall each indemnify the other against all costs, expenses, attorneys'
fees, and other liability for commissions or other compensation claimed by any
broker or agent claiming the same by, through, or under the indemnifying party.
(e) Estoppel Certificates. From time to time, Tenant shall furnish to any
---------------------
party designated by Landlord, within ten days after Landlord has made a request
therefor, a certificate signed by Tenant confirming and containing such factual
certifications and representations as to this Lease as Landlord may reasonably
request.
(f) Notices. All notices and other communications given pursuant to this
-------
Lease shall be in writing and shall be (1) mailed by first class, United States
Mail, postage
15
prepaid, certified, with return receipt requested, and addressed to the parties
hereto at the address specified next to their signature block, (2) hand
delivered to the intended address, or (3) sent by prepaid telegram, cable,
facsimile transmission, or telex followed by a confirmatory letter. All notices
shall be effective upon delivery to the address of the addressee. The parties
hereto may change their addresses by giving notice thereof to the other in
conformity with this provision.
(g) Severability. If any clause or provision of this Lease is illegal,
------------
invalid, or unenforceable under present or future laws, then the remainder of
this Lease shall not be affected thereby and in lieu of such clause or
provision, there shall be added as a part of this Lease a clause or provision as
similar in terms to such illegal, invalid, or unenforceable clause or provision
as may be possible and be legal, valid, and enforceable.
(h) Amendments and Binding Effect. This Lease may not be amended except by
-----------------------------
instrument in writing signed by Landlord and Tenant. No provision of this Lease
shall be deemed to have been waived by Landlord unless such waiver is in writing
signed by Landlord, and no custom or practice which may evolve between the
parties in the administration of the terms hereof shall waive or diminish the
right of Landlord to insist upon the performance by Tenant in strict accordance
with the terms hereof. The terms and conditions contained in this Lease shall
inure to the benefit of and be binding upon the parties hereto, and upon their
respective successors in interest and legal representatives, except as otherwise
herein expressly provided. This Lease is for the sole benefit of Landlord and
Tenant, and, other than Landlord's Mortgagee, no third party shall be deemed a
third party beneficiary hereof.
(i) Quiet Enjoyment. Provided Tenant has performed all of its obligations
---------------
hereunder, Tenant shall peaceably and quietly hold and enjoy the Premises for
the Term, without hindrance from Landlord or any party claiming by, through, or
under Landlord, but not otherwise, subject to the terms and conditions of this
Lease.
(j) No Merger. There shall be no merger of the leasehold estate hereby
---------
created with the fee estate in the Premises or any part thereof if the same
person acquires or holds, directly or indirectly, this Lease or any interest in
this Lease and the fee estate in the leasehold Premises or any interest in such
fee estate.
(k) No Offer. The submission of this Lease to Tenant shall not be
--------
construed as an offer, and Tenant shall not have any rights under this Lease
unless Landlord executes a copy of this Lease and delivers it to Tenant.
(l) Entire Agreement. This Lease constitutes the entire agreement between
----------------
Landlord and Tenant regarding the subject matter hereof and supersedes all oral
statements and prior writings relating thereto. Except for those set forth in
this Lease, no representations, warranties, or agreements have been made by
Landlord or Tenant to the
16
other with respect to this Lease or the obligations of Landlord or Tenant in
connection therewith.
(m) Waiver of Jury Trial. To the maximum extent permitted by law, Landlord
--------------------
and Tenant each waive right to trial by jury in any litigation arising out of or
with respect to this Lease.
(n) Governing Law. This Lease shall be governed by and construed in
-------------
accordance with the laws of the State in which the Premises are located.
(o) Joint and Several Liability. If Tenant is comprised of more than one
---------------------------
party, each such party shall be jointly and severally liable for Tenant's
obligations under this Lease.
(p) Financial Reports. Within 15 days after Landlord's request, Tenant
-----------------
will furnish Tenant's most recent audited financial statements (including any
notes to them) to Landlord, or, if no such audited statements have been
prepared, such other financial statements (and notes to them) as may have been
prepared by an independent certified public accountant or, failing those,
Tenant's internally prepared financial statements. Tenant will discuss its
financial statements with Landlord and will give Landlord access to reasonable
supporting documentation and information in order to enable Landlord to verify
the financial statements if they are not audited financial statements. Landlord
will not disclose any aspect of Tenant's financial statements that Tenant
designates to Landlord as confidential except (a) to Landlord's lenders or
prospective purchasers of the Building, (b) in litigation between Landlord and
Tenant, and (c) if required by court order.
(q) Landlord's Fees. Whenever Tenant requests Landlord to take any action
---------------
or give any consent required or permitted under this Lease, Tenant will
reimburse Landlord for Landlord's reasonable out-of-pocket costs (estimated at
$350 per request) incurred in reviewing the proposed action or consent,
including without limitation reasonable attorneys', engineers' or architects'
fees, within 10 days after Landlord's delivery to Tenant of a statement of such
costs. Tenant will be obligated to make such reimbursement without regard to
whether Landlord consents to any such proposed action.
(r) List of Exhibits. All exhibits and attachments attached hereto are
----------------
incorporated herein by this reference.
Exhibit A - Outline of Premises
Exhibit B - Description of Building and Site
Exhibit C - Building Rules and Regulations
Exhibit D - Renewal Option
Exhibit E - Right of First Offer
Exhibit F - Operating Cost Estimate (Year 1)
17
(s) Contingencies. Landlord shall have the right to cancel this Lease if
-------------
(1) Landlord is unable to acquire the site where the Building is to be located
(as reflected in Exhibit B attached hereto) on terms acceptable to it, or (2)
the Building is not approved as required by the restrictive covenants
encumbering the site, or (3) Landlord is unable to obtain financing for the
construction of the Building on terms acceptable to it. If the Lease is
terminated pursuant to this Section 24(s), the parties will have no further
rights or obligations hereunder. Landlord will give Tenant written notice as
soon as the referenced contingencies are satisfied, which the parties anticipate
will be on or before April 1, 1998.
(t) Tenant Signage. Tenant shall have the right to design and install
--------------
monument signage in connection with its occupancy of the Premises. The location
of such signage, and all design and other specifications associated with such
signage, shall be subject to Landlord's prior written approval. Tenant will not
install its signage until the location and design have been approved in writing
by the Landlord. All costs associated with such signage shall be paid by
Tenant.
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LANDLORD AND TENANT EXPRESSLY DISCLAIM ANY IMPLIED WARRANTY THAT THE PREMISES
ARE SUITABLE FOR TENANT'S INTENDED COMMERCIAL PURPOSE, AND TENANT'S OBLIGATION
TO PAY RENT HEREUNDER IS NOT DEPENDENT UPON THE CONDITION OF THE PREMISES OR THE
PERFORMANCE BY LANDLORD OF ITS OBLIGATIONS HEREUNDER, AND, EXCEPT AS OTHERWISE
EXPRESSLY PROVIDED HEREIN, TENANT SHALL CONTINUE TO PAY THE RENT, WITHOUT
ABATEMENT, SETOFF OR DEDUCTION, NOTWITHSTANDING ANY BREACH BY LANDLORD OF ITS
DUTIES OR OBLIGATIONS HEREUNDER, WHETHER EXPRESS OR IMPLIED.
Dated as of the date first above written.
TENANT:
Address:
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JORDAN ASSOCIATES, INC. 0000 X. Xxxxxxxx Xxxx., Xxxxx 000
Xxxxxxxx Xxxx, Xxxxxxxx 00000
By: /s/ Xxxxxxxx Xxxxx
------------------------------
Name: Xxxxxxxx Xxxxx
Title: President and Chief Executive Officer
LANDLORD:
Address:
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OKC REAL ESTATE INVESTMENTS, INC. 0000 X.X. Xxxxxxxxxx, Xxxxx 0000
Xxxxxxxx Xxxx, Xxxxxxxx 00000
By: /s/ Xxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxx
-------------------------
Title: President
-----------------------
19