Lease Expansion and Fourth Amendment to Lease Agreement
This Lease Expansion and Fourth Amendment to Lease Agreement
("Fourth Amendment") is entered into as of the _____ day of
, 1997, between KAB Plaza Partners, L. P., a Texas limited
partnership ("Landlord"), and AMRESCO, INC., a Delaware
corporation ("Tenant").
W I T N E S S E T H :
WHEREAS, K-P Plaza Limited Partnership, a Texas limited
partnership ("K-P Plaza"), and Tenant entered into that certain
Office Lease dated February 9, 1996, as amended by that certain
First Amendment to Office Lease dated July 17, 1996 ("First
Amendment"), covering approximately 130,606 rentable square feet
of area ("Original Premises") located on the entire 17th, 22nd,
23rd, 24th, and 25th floors and part of the 16th floor as more
particularly described in the Lease and commonly referred to as
Suite 2400 in the office building located at 000 Xxxxx Xxxxx
Xxxxxx (the "North Tower") within the development commonly known
as the Plaza of the Americas situated on Blocks 257 and 258 in
the City of Dallas, Texas;
WHEREAS, K-P Plaza and Tenant entered into that Second
Amendment to Lease Agreement dated May 27, 1997 ("Second
Amendment"), whereby Tenant leased 3,858 rentable square feet of
area located on the 16th floor of the North Tower on a temporary
basis until December 31, 1997 (the "Temporary Premises"), all as
set forth in the Second Amendment;
WHEREAS, K-P Plaza and Tenant entered into that Third
Amendment to Lease Agreement dated September 22, 1997 ("Third
Amendment"), whereby Tenant leased an additional 3,128 rentable
square feet of area located on the 16th floor of the North Tower
on a temporary basis until March 31, 1998 ("Additional Temporary
Premises"), all as set forth in the Third Amendment (such Office
Lease Agreement, as amended by the First, Second, and Third
Amendments, is hereafter referred to as the "Lease");
WHEREAS, Landlord is the successor-in-interest to K-P Plaza
and has assumed all of K-P Plaza's obligations under the Lease;
and
WHEREAS, Landlord and Tenant desire to amend the Lease to,
among other things, expand the Premises (as described in the
Basic Office Lease Information incorporated into the Lease) by an
additional 32,139 rentable square feet of area on the 16th and
19th floors of the North Tower as shown on Exhibit "A" to this
Fourth Amendment, all as more fully set forth in this Fourth
Amendment, which areas also shall replace the areas subject to
Tenant's expansion option set forth in Exhibit "K" of the Lease;
NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged,
Landlord and Tenant hereby agree to amend the Lease as follows:
1. Definitions. Unless otherwise defined, all defined terms in
this Fourth Amendment have the same meaning as in the Lease.
2. Premises. Beginning on January 1, 1998, the Premises as
described in the Basic Office Lease Information incorporated into
the Lease will expand to include the 32,139 rentable square feet
of area located on the 16th and 19th floors of the North Tower as
shown on Exhibit "A" to this Fourth Amendment ("Expansion
Premises"). Thereafter, the Premises as described in the Basic
Office Lease Information incorporated into the Lease will total
162,745 rentable square feet of area -- which Premises will
include the space on the 16th floor of the North Tower that
presently consists of the Temporary Premises and the Additional
Temporary Premises. Notwithstanding the terms of the Second and
Third Amendments to the contrary, on January 1, 1998, the
Temporary Premises and the Additional Temporary Premises will
become part of the Premises as described in the Basic Office
Lease Information incorporated into the Lease, and the lease of
such space will be governed by the terms of this Fourth Amendment
and not by the terms of the Second or Third Amendment. Upon
delivery of all of the Expansion Premises, Tenant shall execute
and deliver to Landlord, within 10 days after Landlord has
requested same, a letter confirming (i) the Tenant's acceptance
of the Expansion Premises, (ii) the Rent Commencement Date for
Expansion (as hereafter defined), and (iii) that Landlord has
performed all of its obligations with respect to the Expansion
Premises.
3. Term. The Term of the Lease (i) remains unchanged by this
Fourth Amendment and (ii) applies to the Expansion Premises.
4. Basic Rental. Beginning on the date which is the earlier
of: (i) Tenant's occupancy of any portion of the Expansion
Premises for the conduct of business or (ii) March 1, 1998 (the
earlier of such dates being hereinafter referred to as the "Rent
Commencement Date for Expansion"), and continuing until the end
of the Term subject to the provisions of Section 2 of this Fourth
Amendment, the Basic Rental applicable to the Expansion Premises
is set forth in the following schedule and is payable in the
manner provided in Article 4 of the Lease:
Rental Rate per
Months Square Foot of Rent Due
Rentable Area of
Expansion Premises
Rent Commencement Date for $15.75 $42,182.44 per month
Expansion - October 31, 1998
Nov. 1, 1998 - Oct. 31, 1997 $16.00 $42,852.00 per month
Nov. 1, 1999 - Oct. 31, 2000 $16.25 $43,521.56 per month
Nov. 1, 2000 - Oct. 31, 2001 $16.50 $44,191.13 per month
Nov. 1, 2001 - Oct. 31, 2002 $16.75 $44,860.69 per month
Nov. 1, 2002 - Oct. 31, 2003 $17.00 $45,530.25 per month
Nov. 1, 2003 - Oct. 31, 2004 $17.25 $46,199.81 per month
Nov. 1, 2004 - Oct. 31, 2005 $17.50 $46,869.38 per month
Nov. 1, 2005 - Oct. 31, 2006 $17.75 $47,538.94 per month
The Basic Rental set forth above applicable to the Expansion
Premises includes Tenant's Proportionate Share of Basic Costs for
the calendar year commencing January 1, 1998, and ending December
31, 1998, but does not include Tenant's share of electrical and
other utility charges described in Section 4.c of the Lease and
elsewhere. In addition to the Basic Rental applicable to the
Expansion Premises set forth above, Tenant shall pay Landlord in
the manner provided for in the Lease all other amounts due under
the Lease applicable to the Original Premises and the Expansion
Premises, including, without limitation, (i) Tenant's share of
the Excess described in Exhibit "C" to the Lease for the years
after 1998, (ii) the Electrical Costs as set forth in Section 4.c
of the Lease, and (iii) the Basic Rental applicable to the
Original Premises set forth in Exhibit "E" of the First
Amendment. Except as otherwise expressly provided herein,
nothing in this Fourth Amendment effects the payment of Basic
Rental or other sums due under the Lease or its amendments. For
the purposes of calculating the Excess applicable to the
Expansion Premises under Exhibit "C" of the Lease, the cap on
Controllable Expenses applies, but the Expense Stop applicable to
the Expansion Premises shall be calculated using Basic Cost for
the calendar year 1998.
5. Tenant's Proportionate Share. Except for the adjustments
set forth in this Xxxxxxxxx 0, Xxxxxxxx and Tenant stipulate and
agree that for all purposes under this Lease, effective from and
after Rent Commencement Date for Expansion, the Tenant's
Proportionate Share is 15.565%. It is further stipulated and
agreed that for all purposes under this Lease, the Tenant's
Proportionate Share is obtained by dividing (i) the 162,745
rentable square feet in the Premises (which includes a pro rata
share of the Common Areas) by (ii) 1,045,551. The foregoing
numbers of rentable square feet are stipulations and establish a
material part of the economic basis for the execution of this
Lease by Landlord and shall not be adjusted unless the rentable
area of Premises is increased or decreased by the addition or
deletion of rentable area within the Buildings and an appropriate
amendment to this Lease is executed.
6. Tenant Improvements; As Is.
A. TENANT AGREES TO ACCEPT THE EXPANSION PREMISES IN ITS
"AS IS" CONDITION AS OF THE DATE OF THIS FOURTH AMENDMENT WITHOUT
REPRESENTATION OR WARRANTY OF ANY KIND BY LANDLORD, INCLUDING ANY
WARRANTY OF HABITABILITY OR FITNESS FOR ANY PARTICULAR USE.
Tenant shall construct all tenant improvements to the Expansion
Premises (the "Work") pursuant to plans and specifications to be
prepared and agreed upon by Landlord and Tenant (the "Plans").
Approval by Landlord of the Plans is not a representation or
warranty of Landlord that such drawings are adequate for any use,
purpose, or condition, or that such drawings comply with any
applicable law or code, but is merely the consent of Landlord to
the performance of the Work. All changes in the Work must
receive the prior written approval of Landlord, and in the event
of any such approved change Tenant shall, upon completion of the
Work, furnish Landlord with an accurate, reproducible "as-built"
plan (e.g., sepia) of the improvements as constructed, which plan
shall be incorporated into this Lease by this reference for all
purposes.
B. Tenant shall perform all Work using contractors
approved by Landlord in writing prior to the commencement of the
Work, which approval must not be unreasonably withheld or
delayed. Additionally, Landlord must approve in writing all
major subcontractors performing any portion of the Work involving
the structural, mechanical, electrical, and plumbing components
of the Work, which approval may be granted or withheld in
Landlord's sole discretion. Landlord must approve the
construction contract entered into by Tenant and its general
contractor, which approval shall not be unreasonably withheld,
conditioned or delayed, and such contract must provide for a 10%
retainage to be withheld by Tenant throughout the progress of the
Work and for the final payment to such contractor of such
retainage to be made no earlier than 30 days following the
completion of the Work. All Work must be performed in a good and
workmanlike manner that is free of defects and is in strict
conformance with the Plans and all applicable laws, ordinances,
regulations, and codes. The Work must be performed in such a
manner and at such times as to maintain harmonious labor
relations and not to interfere with or delay Landlord's other
contractors, the operation of the Buildings, and the occupancy
thereof by other tenants. All contractors and subcontractors
shall contact Landlord and schedule time periods during which
they may use Buildings' facilities in connection with the Work
(e.g., elevators, excess electricity, etc.)
C. Tenant shall bear the entire cost of performing the
Work (including, without limitation, design of the Work,
preparation of the Plans, and the payment of applicable taxes and
insurance costs) -- all of which costs are herein collectively
called the "Total Construction Costs"; provided, however, Tenant
will receive a construction allowance from Landlord equal to
$567,689.25 [representing the sum of: (i) $21.90 multiplied by
the first 10,000 rentable square feet of area within the
Expansion Premises (i. e., $219,000.00) and (ii) $15.75
multiplied by the 22,139 rentable square foot of area within the
balance of the Expansion Premises (i. e., $348,689.25)] (such sum
being the "Construction Allowance") for the sole purpose of
paying a portion of the Total Construction Costs. Landlord shall
pay the Construction Allowance to Tenant no more frequently than
once per month on or before 30 days following Landlord's receipt
of the following items from Tenant: (i) an Application and
Certificate for Payment (AIA Document G702) fully executed by
Tenant's architect, (ii) paid invoices from architects,
subcontractors, and suppliers evidencing the cost of performing
the Work, (iii) lien waivers from Tenant's general contractor and
all parties referenced in item (ii) above, and (iv) with respect
to the final payment of the Construction Allowance, a certificate
of occupancy from the appropriate governmental authority, if
applicable to the Work, or evidence of governmental inspection
and approval of the Work.
D. Tenant, its contractors, and their subcontractors
shall, at their sole expense, maintain in effect at all times
during the full term of the Work, insurance coverages with limits
not less than those set forth below with insurers licensed to do
business in Texas and acceptable to Landlord and under forms of
policies satisfactory to Landlord. None of the requirements
contained herein as to types, limits, and Landlord's approval of
insurance coverage to be maintained by the above-mentioned
parties are intended to and shall not in any manner limit or
qualify the liabilities and obligations assumed by Tenant under
the Lease.
Minimum Amounts
Coverage and Limits
1. Worker's Compensation
a) Workers' Compensation Statutory Limits
Employer's Liability $100,000
This policy shall contain a Waiver of Subrogation in favor of Landlord.
2. Commercial General Liability
a) Bodily Injury/Property Damage $500,000
each occurrence
or equivalent/$500,000
aggregate
This policy shall be on a form acceptable to Landlord,
endorsed to include Landlord as an additional insured during
the term of the contract, state that this insurance is
primary insurance as regards to any other insurance carried
by Landlord, and shall include the following coverages:
a) Premises/Operations
b) Independent Contractors
c) Completed Operations for a period of two years
following acceptance of contractor's work
d) Broad Form Contractual Liability in support of the
Indemnity section of this Lease.
e) Broad Form Property Damage
f) Personal Injury Liability with contractual and
employee exclusions removed
3. Comprehensive Automobile Liability
a) Bodily Injury $250,000 per person
$500,000 per occurrence
b) Property Damage $100,000 per occurrence
4. Umbrella Excess Liability Insurance
a) Bodily Injury/Property $5,000,000 per occurrence
$5,000,000 aggregate
5. Builder's Risk Policy
Unless otherwise provided, Tenant shall purchase and
maintain property insurance upon the Work at the site
to the full insurable value thereof. This insurance
shall include the interest of Landlord, Tenant,
contractor, and subcontractors in the Work and shall be
written on an all risk form.
The policy shall be written on an excess basis above
coverages as described in 1, 2, and 3 above, naming
Landlord as additional insured.
6. Contractor's Equipment Policy
Any such insurance policy covering contractor or its
subcontractor's equipment and tools against loss by
physical damage shall include an endorsement waiving
the insurer's right of subrogation against Landlord.
7. Tenant's architect and engineer shall, at their sole
expense, maintain in effect at all times during the
full term of the Work, insurance coverages with limits
not less than those set forth in 1, 2, and 3 above, as
well as professional liability insurance with a limit
of not less than $1,000,000 per occurrence and
$1,000,000 aggregate and with Landlord named as an
additional insured.
Evidence of the above coverages, represented by Certificates of
Insurance issued by the insurance carrier must be furnished to
Landlord prior to the contractor's starting work. Certificates
of Insurance shall specify the additional insured status
mentioned above as well as the Waivers of Subrogation. Such
Certificates of Insurance shall state that Landlord will be
notified in writing 30 days prior to cancellation, material
change, or renewal of insurance.
E. If a delay in the performance of the Work occurs (a)
because of any change by Tenant to the Plans, (b) because of any
specification by Tenant of materials or installations in addition
to or other than Landlord's standard finish-out materials, or (c)
if Tenant otherwise delays completion of the Work, then,
notwithstanding any provision to the contrary in this Lease,
Tenant's obligation to pay Rent with respect to the Expansion
Premises will commence on the scheduled Rent Commencement Date
for Expansion.
F. Landlord or its designee shall supervise the Work and
act as a liaison between the contractor and Tenant.
7. Parking. Effective on the Rent Commencement Date for
Expansion, in addition to Tenant's right to utilize certain
parking spaces in the Parking Garage as set forth in Exhibit "G"
to the Lease and so long as Tenant is not in material default
under this Lease (nor does any condition exists that with the
passage of time or the giving of notice, or both, will constitute
a default), Tenant is permitted (but not obligated to) utilize
twenty-two (22) additional undesignated parking space in the
Parking Garage, subject to such rates, terms, conditions and
regulations as are from time to time charged or applicable to
patrons of the Parking Garage. The current market rate being
charged patrons of the Parking Garage for undesignated parking
spaces is $115 a month per space. Except as otherwise set forth
in this Fourth Amendment, the terms of Exhibit "G" to the Lease
will apply to Tenant's use of such spaces.
8. Brokerage. Tenant warrants that it has had no dealings
with any broker or agent in connection with the negotiation or
execution of the Lease or this Fourth Amendment other than with
Xxxxxxxx Properties Limited, Inc. and Xxxxxxx & Wakefield of
Texas, Landlord shall pay such brokers all lease commissions
arising out of this Fourth Amendment pursuant to a separate
agreement. Both Landlord and Tenant agree to indemnify each
other and hold each other harmless from and against any and all
costs (including investigation and defense costs) and expenses,
claims for commissions or other payments by any broker or agent
who alleges to have performed services on behalf of the
indemnifying party.
9. Expansion Option Exhibit. Exhibit "K" of the Lease
entitled "Expansion Options" and all references thereto are
hereby deleted in their entirety and the following paragraph
substituted in lieu thereof:
So long as Tenant is not in material default under this
Lease (nor does any condition exists that with the
passage of time or the giving of notice, or both, will
constitute a default), Tenant shall have the one-time
option (the "Expansion Option") to increase the area of
the Premises by a minimum of 9,000 rentable square feet
and a maximum of 11,000 rentable square feet
("Expansion Option Space") located either (i) on a
floor in the North Tower contiguous to a floor
containing the then existing Premises or (ii) on the
same floor and adjacent to the then existing Premises -
- as such Expansion Option Space is designated by
Landlord and reasonably acceptable to Tenant. The
Expansion Option Space must be either (i) in one block
of contiguous space or (ii) in separate blocks of space
that, when combined, will total the Expansion Option
Space, and all of the Expansion Option Space is subject
to the renewal, expansion, or other rights of other
tenants as of the date of this Fourth Amendment.
Tenant may exercise the Expansion Option (if at all) by
delivery of written notice to Landlord no later than
January 1, 2003 (such deadline by which Tenant must
exercise the Expansion Option is hereinafter referred
to as the "Exercise Date"). In the event that Tenant
fails to timely exercise the Expansion Option, Tenant
shall have no further expansion rights; time being of
the essence with respect to Tenant's exercise thereof.
Following the exercise by Tenant of the Expansion
Option, Landlord shall deliver to Tenant possession of
the Expansion Option Space in its "AS IS" condition no
earlier than June 1, 2003, and no later than January
31, 2004 (such date of delivery hereinafter referred to
as the "Delivery Date for Expansion Option"). The
Basic Rental for the Expansion Option Space will
commence on the date which is sixty (60) days following
the Delivery Date for Expansion Option and will equal
the prevailing Market Rate (as defined in Exhibit "P"
to this Lease) at the Delivery Date for Expansion
Option, as adjusted in the manner provided in this
Lease. Prior to the Delivery Date for Expansion
Option, Landlord and Tenant shall join in executing and
delivering an amendment to the Lease clearly
identifying the location and rentable square footage of
the Expansion Option Space and specifying the Basic
Rental and other Rent payable with respect to the
Expansion Option Space. Except as set forth in this
exhibit, Tenant's lease of the Expansion Option Space
will otherwise be on the same terms and conditions as
are set forth in this Lease with the same Expiration
Date.
Tenant's rights under this Exhibit "K" shall terminate
if (a) this Lease or Tenant's right to possession of
the Premises is terminated, (b) Tenant assigns its
interest in this Lease without Landlord's consent, or
(c) Tenant sublets any portion of the Premises without
Landlord's consent.
10. Management Company. Tenant acknowledges that Xxxxxxxx
Properties Limited, Inc. is the Landlord's management and leasing
representative.
11. Authority. Each individual signing below represents
that he/she has been duly authorized to execute and deliver this
Fourth Amendment and that same shall be binding on Landlord and
Tenant (as applicable) on whose behalf he/she is signing.
12. Entire Agreement. This Fourth Amendment, together with
the provisions of the Lease, embody the entire agreement between
the parties with respect to the subject matter hereof and cannot
be varied except by written agreement of the parties.
13. Successors and Assigns. All of the terms, covenants,
provisions, and conditions of this Fourth Amendment are hereby
made binding on the executors, heirs, administrators, successors,
and permitted assigns of both parties hereto.
14. Headings. The captions used in connection with the
sections of this Fourth Amendment are for convenience only and
shall not be deemed to construe or limit the meaning of the
language of this Fourth Amendment.
15. Conflict. In the event of any conflict between the
provisions of this Fourth Amendment and the provisions of the
Lease, the provisions of this Fourth Amendment will govern and
control.
16. Lease. As amended hereby, the Lease will govern the
Expansion Premises and will continue in full force and effect and
is ratified and confirmed by Landlord and Tenant. From and after
the date of this Fourth Amendment, the term "Lease", when used in
the Lease, will mean the Lease, as further amended by this Fourth
Amendment.
17. Counterparts. This Fourth Amendment may be executed in
multiple counterparts and signature pages from any counterpart
may be appended to any other counterpart. All counterparts shall
constitute a single, unified instrument.
Witness the Execution Hereof, effective as of the date set
forth above.
AMRESCO, INC., a Delaware corporation
By:
Title:
KAB Plaza Partners, L. P.,
a Texas limited partnership
By: AB Sub II, Inc.,
its general partner
By:
Title:
