CONTRACT OF SALE
THIS CONTRACT OF SALE (this "Contract") is made by and between ULTRAK
OPERATING, L.P., a Texas limited partnership ("Seller"), and BRIARWOOD CAPITAL
CORPORATION, a Texas corporation, and/or its successors and/or assigns (subject
to Section 11.6 below) ("Purchaser"). In consideration of the agreements herein
contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Seller and Purchaser agree as
follows:
ARTICLE I
Sale and Purchase
Subject to the terms and provisions of this Contract, Seller hereby
sells and agrees to sell and convey to Purchaser, and Purchaser hereby buys and
agrees to pay for all of the following described property (sometimes referred to
herein in collectively as the "Property"):
(a) A total of 14.002 acres of land being all of Lots 1R-A and 1R-B,
Block C, of Water's Ridge-Phase I, an Addition to the City of
Lewisville, Xxxxxx County, Texas, according to the Replat
thereof recorded on May 10, 2001, under Document No.
2001-R0044819, Plat Records, Xxxxxx County, Texas, being a
replat of Lot 1R Block C, of Water's Ridge-Phase I, an Addition
to the City of Lewisville, Xxxxxx County, Texas, according to
the Replat thereof recorded in Cabinet M, Page 66, Plat Records,
Xxxxxx County, Texas (the "Land") and being described more fully
on Exhibit "A" attached hereto and made a part hereof for all
purposes, such description contained on Exhibit "A" being for
the reasonable identification of the Land which is the subject
hereof, and may be supplemented by the metes and bounds or other
legal description of the Land to the extent provided for in
Article IV hereinbelow; together with all of Seller's right,
title and interest in and to the rights and appurtenances
pertaining to the Land, including, any right, title and interest
of Seller in and to adjacent roads, streets, alleys, easements
or right-of-way;
(b) the office, industrial and/or warehouse buildings and any and
all other buildings, structures and improvements on the Land
(collectively, and as applicable, the "Improvements"), commonly
referred to as and with a street address of 0000 Xxxxxx Xxxxx
Xxxxx, Xxxxxxxxxx, Xxxxx 00000:
(c) all mechanical systems, fixtures and equipment (including, but
not limited to, compressors, engines, elevators and escalators);
electrical systems, fixtures and equipment; heating fixtures,
systems and equipment; air conditioning fixtures, systems and
equipment; plumbing fixtures, systems and equipment; all
furniture, carpets, drapes and other furnishings; refrigerators,
stoves and other appliances; maintenance equipment and tools;
and all other machinery, equipment, fixtures and personal
property of every kind and character, and all accessories and
additions
1
thereto, owned by Seller and located in or on or in the area of
the Property, or used in connection with the Land or the
Improvements or the operations thereon, excluding, however, any
such item(s) that is subject to an Equipment Lease (as
hereinafter defined) (collectively, and as applicable, the
"Personalty");
(d) all rights, titles and interests of Seller in and to any
easements, rights-of-way, rights of ingress or egress or other
interests in, on or to any land, highway, street, road or
avenue, opened or proposed, in, on, across, in front of,
abutting or adjoining the Land;
(e) all goodwill, if any, relating to the Land and Improvements; all
telephone exchanges, if any, related to the operation and
management of the Property;
(f) all rights, titles and interests of Seller in and to any
condemnation award, if any, made or to be made, after the
Closing Date, in respect of the Land and/or the interests
described in the foregoing Paragraphs (a) and (e) of this
Article and in and to any unpaid award for damage to the Land or
Improvements and/or said interests by reason of change of grade
of any street. Seller will execute and deliver to Purchaser, at
the Closing (as hereinafter defined), or thereafter, on demand,
but without recourse or warranty, all property instruments for
the conveyance of such title and the assignment and collection
of any such award; and
(g) all other rights, privileges and appurtenances owned by Seller
and in any way related to the properties described above in this
Article I, including but not limited to all warranties,
guarantees, plans, specifications, permits, maintenance
contracts and other contracts pertaining to the Property (to the
extent in Seller's possession, assignable and desired by
Purchaser).
ARTICLE II
Xxxxxxx Money Deposit
2
2.1 Amount and Title Company. Purchaser shall, upon execution of this
Contract by both Purchaser and Seller, deposit with Republic Title of Texas,
Inc., whose address is 0000 Xxxxxx Xxxxxx, 00xx Xxxxx, Xxxxxx, Xxxxx 00000,
Attention: C. Xxxxxxx Xxxxx [Telephone: (000) 000-0000; Telecopy: (214)
855-8898] (hereinafter referred to as the "Title Company"), the sum of
$100,000.00 (the "Xxxxxxx Money"). The Xxxxxxx Money shall be deposited by the
Title Company in an interest-bearing account at a federally insured depository
institution in Dallas County, Texas, acceptable to Purchaser. Any interest
accruing on such account prior to the time such Xxxxxxx Money becomes the
property of Seller or Seller gains the rights thereto, shall be reported for
tax purposes under the tax identification number of Purchaser. After such time
as Seller becomes entitled to the Xxxxxxx Money, the interest accruing or paid
may be reported under Seller's tax identification number. In the event that
this Contract is actually closed and consummated in accordance with the terms
hereof, the Xxxxxxx Money shall be applied toward the cash payment due at
Closing by the Purchaser to the Seller in accordance with the terms of Article
III hereinbelow. In the event that this Contract does not actually close and
consummate in accordance with the terms hereof, the Xxxxxxx Money shall be
disbursed by the Title Company to Seller or Purchaser (as appropriate) in
accordance with the terms of this Contract. In the event that the Purchaser
shall fail to timely deposit the Xxxxxxx Money (or, if in the form of a check,
the bank on whom such check is drawn refuses to fully honor such check when
negotiated and presented for payment by the Title Company), this Contract
shall by written notice from Seller to Purchaser terminate, whereupon neither
party shall have any further obligations or liabilities hereunder.
2.2 Independent Contract Consideration. Seller and Purchaser hereby
acknowledge that independent consideration for this Contract in the sum of
$100.00 shall be delivered to Seller out of the Xxxxxxx Money should this
Contract terminate for any reason whatsoever (excepting a default by Seller);
and based on such consideration and the mutual covenants of Seller and
Purchaser contained herein, Seller hereby agrees that Seller shall not
terminate this Contract without the prior written consent of Purchaser except
as may be expressly provided for in this Contract. This paragraph does not
limit Seller's possible right to retain the Xxxxxxx Money under other
provisions of the Contract.
ARTICLE III
Purchase Price
3.1 Amount. The total purchase price for the Property (the "Purchase
Price") shall be SIX MILLION SIX HUNDRED THOUSAND AND NO/100 DOLLARS
($6,600,000.00).
3.2 Manner of Payment. The Purchase Price shall be paid to Seller and
shall be payable in cash or other same-day immediately available funds at the
Closing.
3
ARTICLE IV
Title and Survey; Environmental
4.1 Title Commitment. As soon as is practicable following the date of
this Contract (but in any event, within three (3) business days after the date
of this Contract), the Title Company shall, at Seller's sole cost and expense,
deliver to Purchaser and to the surveyor referred to in Section 4.2 below: (i)
a current commitment for Owner's Policy of Title Insurance in favor of
Purchaser (the "Title Commitment"), (ii) legible copies of all instruments
shown as exceptions in Schedule B of the Commitment, and (iii) UCC searches,
both from the Secretary of State of Texas, the Secretary of State of the state
of incorporation of Seller and from Xxxxxx County, Texas (the "UCC Searches").
4.2 Survey. As soon as is practicable following the date of this
Contract (but in any event, within three (3) business days after delivery of
the Title Commitment to Purchaser), Seller shall, at Seller's sole cost and
expense, cause to be furnished to Purchaser and the Title Company a copy of
the as-built survey plat of the Land and Improvements (the "Survey"), prepared
by Xxxx Xxxxxx of Xxxxxxxxx/Xxxxx/Xxxxx, Inc., or by another registered
surveyor or engineer reasonably acceptable to Purchaser and in a form
acceptable to the Title Company for it to delete the survey exception (other
than area) from Schedule B of its Owner Policy of Title Insurance. The Survey
shall also be certified to Purchaser and the Title Company, shall include a
legal description of the Land, shall show the location and dimensions of all
the improvements, encroachments, uses (including the location of all streets,
roads, easements, alleys and right-of-way upon or adjacent to the Land) and
encumbrances which are visible on the ground or listed on the Title Commitment
(identifying each by volume and page reference, if applicable), shall recite
an exact area of the Land, shall state whether or not applicable governmental
maps show all or any portion of the Land to be within a flood plain, and shall
otherwise be in accordance with the standards for a Category 1A, Condition II
survey, as established and adopted by the Texas Society of Professional
Surveyors.
4.3 Review Period. Purchaser shall have a period (the "Review
Period") ending on the later of (a) seven (7) days after the date on which
Purchaser has received the last of the Title Commitment, the UCC Searches, the
Survey and the Submission Matters, or (b) ten (10) days following the
execution of this Contract, to terminate this Contract if it is not satisfied
with any one or more of the Review Items (as defined in Section 5.3 below).
Any title encumbrances or exceptions which are set forth in Schedule B of the
Title Commitment or on the Survey at the conclusion of the Review Period (but
not including any mortgage lien, if any, which Seller agrees to remove at or
prior to the Closing), shall be deemed to be permitted exceptions to the
status of Seller's title (the "Permitted Exceptions").
4.4 Environmental. As between Seller and Purchaser, Seller shall be
responsible for taking such remedial action as may be required by applicable law
in connection with any hazardous or toxic materials that are located on or under
the Property as of the Closing (except with respect to any hazardous or toxic
materials released onto or under the Property by Purchaser or its agents or
invitees), and Seller shall indemnify and hold Purchaser harmless with respect
to any costs, demands, claims or liabilities incurred by Purchaser in connection
therewith, provided that Purchaser shall provide Seller written notice of any
hazardous or toxic materials located on or under the Property that are
discovered by Purchaser prior to the Closing. The term "hazardous or toxic
materials" as used in this Contract shall mean (w) any "hazardous waste" as
defined by the Resource Conservation and Recovery Act of 1976 (42 U.S.C. ss.6901
et.seq.), as amended from time to time, including
4
without limitation, as amended by the Used Oil Recycling Act of 1980, the
Solid Waste Disposal Act Amendments of 1980, and the Hazardous and Solid Waste
Amendments of 1984, and regulations promulgated thereunder, (x) any "hazardous
substance", "pollutant" or "contaminant" as defined by the Comprehensive
Environmental Response, Compensation and Liability Act of 1980 (42 U.S.C.
ss.9601 et. seq.), as amended from time to time, including without limitation,
as amended by the Superfund Amendments and Reauthorization Act of 1986, and
regulations promulgated thereunder, all as amended from time to time, and all
rules and regulations applicable to each, (y) any toxic substance as defined
under or regulated by the Toxic Substances Control Act, and (z) oil and
petroleum products, chlorinated biphenyls, radioactive materials or waste
containing lead. The provisions of this Section 4.4 shall survive the Closing.
ARTICLE V
Investigation by Purchaser
5.1 Matters Previously Submitted or to be Submitted. Purchaser
acknowledges that Seller has previously delivered to Purchaser the items
marked below with an (x). Seller hereby agrees that for those items below
which are not marked with an (x), Seller will deliver (and/or cause to be
delivered) such items to Purchaser within three (3) business days after the
date of this Agreement. All items listed below, i.e., regardless of whether or
not marked with an (x), are hereinafter referred to as the "Submission
Matters":
( ) (a) copies of any structural, mechanical, electrical and
environmental studies of the Property (if any) in the
possession of Seller (and Seller agrees to either (i) cause
such environmental studies (if any) to be addressed to
Purchaser, or (ii) cause letters from the firms and/or
engineers (as applicable) that prepared such environmental
studies (if any) to be issued to Purchaser, stating that
such environmental studies may be relied upon by Purchaser);
( ) (b) whatever site plans, plans, specifications and similar
information may be in the possession of Seller;
( ) (c) copies of any Certificates of Occupancy in the
possession of Seller;
( ) (d) copies of all equipment leases (as applicable,
referred to herein singularly as an "Equipment Lease", and
collectively as "Equipment Leases"), warranties, maintenance
contracts and service contracts pertaining to the Property
(to the extent in the possession of Seller);
( ) (e) copies of all paid utility bills for the most recent
calendar month;
( ) (f) copies of 2000 and 2001 tax statements (and evidence
of payment of 2000 taxes), and documentation relating to the
2002 valuation, as well as any valuation appeal (if any);
( ) (g) copies of operating statements (including revenues and
expenses) for 2000 and year-to-date 2001; and
5
( ) (h) a written certification signed by an authorized
officer or agent of Seller, confirming that Seller has
delivered (and/or caused to be delivered) all required
Submission Matters which are in its possession and that to
the best knowledge and belief of Seller, all copies
delivered to Purchaser are true and correct copies of such
Submission Matters; provided, however, that Seller does not
warrant the accuracy of such Submission Matters.
Purchaser agrees that (x) unless and until the Closing is consummated Purchaser
will keep all Submission Matters strictly confidential and will not reveal any
information therein except to Purchaser's professional counselors (i.e.,
engineers, property managers, attorneys, accountants, etc.) or to potential
partners and/or financial sources for purchase-money financing (if any), and (y)
in the event that the Closing is not consummated, Purchaser shall return such
Submission Matters to Seller.
5.2 Inspection. During the Review Period, Seller shall, to the extent
that it does not require Seller's expenditure of more than nominal funds,
cooperate and assist Purchaser or its authorized representatives in any and
all feasibility studies (physical, financial, legal or otherwise), audits,
inspections and tests which Purchaser may choose to conduct. Within such
period, Purchaser may also inspect the Property and may authorize its agents
to conduct environmental, engineering, mechanical, roof and electrical
inspections and tests to determine if the Property is in a condition
satisfactory to the Purchaser; provided, however, that Purchaser must give
advance telephone notice of such on-site inspections to a representative of
Seller and must obtain the prior written consent of Seller (such consent not
to be unreasonably withheld, conditioned or delayed) to conduct any invasive
environmental tests on the Property. All inspections and tests by Purchaser or
its representatives shall be at the sole cost and expense of Purchaser.
Purchaser and its agents and representatives shall enter upon the Land and
Improvements at their own risk and shall not unreasonably interfere with the
operation of the Property. Purchaser shall repair at Purchaser's expense any
damage to the Property caused by the inspections or tests. Purchaser agrees to
indemnify and hold Seller harmless from any loss, cost or expense in
connection with any such inspection, excluding Seller's negligence or willful
misconduct, as a result of unpermitted activity.
5.3 Approval of Review Items. The obligations of Purchaser pursuant
to this Contract are expressly conditioned and contingent upon Purchaser's
satisfaction, in Purchaser's complete discretion, with the Title Commitment,
the UCC Searches, the Survey, the Submission Matters and the results of all
reviews, inspections and feasibility studies made by Purchaser pursuant to the
provisions of Sections 5.1 and 5.2 within the Review Period (collectively, the
"Review Items"). In the event Purchaser fails to notify Seller in writing on
or before the end of the Review Period, of its approval of all such Review
Items, then this Contract shall automatically terminate, which shall be a
Permitted Termination as provided in Section 9.1 hereof.
ARTICLE VI
Warranties and Representations
6.1 Seller's Warranties and Representations. Seller represents and
warrants to Purchaser as of the date hereof that to the best if Seller's
knowledge all of the statements set out below are accurate:
6
(a) There are no parties in possession of any portion of the
Property, as lessees (whether in possession or not), tenants at
will, trespassers or otherwise, nor any licensees or other
occupants of the Improvements other than Seller.
(b) Seller is not prohibited from consummating the transactions
contemplated in this Contract by any law, regulation, agreement,
instrument, restriction, order or judgment;
(c) There are no attachments, executions, assignments for the
benefit of creditors, receiverships, conservatorships or
voluntary or involuntary proceedings in bankruptcy or pursuant
to any other debtor relief laws pending against Seller, or to
Seller's knowledge threatened against Seller, or the Property;
(d) Seller has not received any written notice of any pending
condemnation or similar proceeding affecting the Land and Seller
has not received any written notice and has no actual knowledge
that any such proceeding is contemplated;
(e) All ad valorem taxes applicable to the Property have been paid
current through calendar year 2001;
(f) No bills are outstanding which create -- or, after the Closing,
may create -- a mechanics lien against all or any portion of the
Property;
(g) Seller has not received actual notice of any action, suit,
proceeding or claim affecting the Property, or affecting Seller
and relating to or arising out of any of any existing leases
affecting the Property or the ownership, operation, use or
occupancy of the Property by Seller pending or being prosecuted
in any court or by or before any federal, state, county, or
municipal department, commission, board, bureau or agency or
other governmental instrumentality nor, to the actual knowledge
of Seller, is any such action, suit, proceeding or claim
threatened or being asserted;
(h) Seller has no knowledge of any unrecorded instruments or
agreements related to the Property, or its operation, which will
survive the Closing, other than those which have been referred
to in this Contract or have been or will be delivered to
Purchaser with the Submission Matters or at Closing;
(i) Seller has no knowledge that the Property has ever been used for
the production, storage, deposit or disposal of any "hazardous
or toxic materials" (as that term is defined in Section 4.4
above);
(j) Seller has no knowledge that the Property or any part thereof is
in violation of any law, ordinance or regulation of any
governmental entity having jurisdiction over the Property;
(k) To the best of Seller's knowledge, no portion of the Property
has been designated by the U.S. Corps of Engineers, nor by the
municipality in which the Property is located, as being in a
"flood plain" or other flood-prone area;
7
(l) To the best of Seller's knowledge, the Property is not located
within a "water district" or other similar utility district;
(m) Neither Seller nor, to the best of Seller's knowledge, any of
Seller's predecessors within the past five years, has claimed
the benefit of any law permitting a special use valuation (such
as agricultural" or "open space") for the purpose of obtaining
an ad valorem tax rate lower than the nominal rate;
(n) Seller is not a "foreign person" as that term is used in Section
1445 of the Internal Revenue Code of 1986, as amended; and
(o) Assuming the truth and accuracy of Purchaser's representations
contained in the Warrant Agreement (as defined in Section 11.17
below) that Purchaser is acquiring the Warrants (as defined in
Section 11.17 below) as an investment and not with a view to the
distribution thereof, the issuance and sale of the Warrants to
Purchaser under the Warrant Agreement are exempt from the
registration requirements of the Securities Act of 1933, as
amended.
It will be a condition to Purchaser's obligations to consummate the Closing that
all above representations and warranties of Seller be accurate as of the Closing
Date. The representations and warranties of Seller shall survive the Closing
(but only as to facts as they exist at the Closing and only to the extent that
the representations and warranties are not actually known by Purchaser to be
incorrect at the Closing). References in this Section 6.1 to the "knowledge" of
Seller shall be deemed to refer only to the actual knowledge (as opposed to
constructive, deemed or imputed knowledge) of the Designated Employees (as
hereinafter defined) of Ultrak, Inc., a Delaware corporation, and shall not be
construed, by imputation or otherwise, (x) to refer to the knowledge of any
party other than the Designated Employees, including, without limitation,
Seller, Ultrak, Inc., or any affiliate of either of them, to any property
manager, or to any other officer, agent, manager, representative or employee of
Seller of Ultrak, Inc., or any affiliate thereof, or (y) to impose on such
Designated Employees any duty to investigate the matter to which such actual
knowledge, or the absence thereof, pertains. As used herein, the term
"Designated Employees" shall refer collectively to (1) Xxxxx Xxxxxx, Vice
President and General Counsel of Ultrak, Inc., (2) Xxxxx X. Xxxx, Treasurer of
Ultrak, Inc., (3) Xxxxxx X. Xxxxxx, Chief Executive Officer of Ultrak, Inc. and
(4) Xxxx Xxxxx, Properties Facilities Manager of Ultrak, Inc.
6.2 Purchaser's Representations and Warranties. Purchaser hereby
represents and warrants as of the date hereof and as of the Closing Date that:
(a) Purchaser has the right, title and authority to enter into this
Contract, to comply with all the terms and obligations hereof
and to consummate the transactions provided for hereunder;
(b) Purchaser has not been served with any notice of any suit,
action or proceeding, nor to the knowledge of Purchaser
threatened against or affecting Purchaser, before or by any
court or administrative agency or officer, which seeks to
prohibit or enjoin this Contract or the transactions provided
for herein;
8
(c) To Purchaser's actual knowledge, no consent, approval or other
action of, or filing or registration with, any governmental
agency, commission or officer is required in connection with the
execution or performance by Purchaser of this Contract;
(d) To Purchaser's actual knowledge, the execution and delivery of
this Contract and the transactions provided for herein will not
result in a breach of any of the terms and provisions of or
constitute a default under or conflict with any agreement,
indenture, mortgage, lien, lease, consent, license, franchise or
other instruments to which Purchaser is bound; and
(e) Purchaser is not the subject of any bankruptcy, receivership, or
reorganization proceeding and has not made any assignment for
the benefit of creditors.
ARTICLE VII
Closing
7.1 Time and Place of Closing. Provided that all of the conditions of
this Contract shall have been satisfied on or prior to the Closing Date
(herein so called), the Closing (herein so called) of this transaction shall
take place at the offices of the Title Company (or any other location in
Dallas County, Texas, which may be mutually agreed by the parties) on the
first business day following the ninth (9th) calendar day after the conclusion
of the Review Period described in Section 4.3 of this Contract above.
7.2 Expenses. Seller shall pay (or cause to be paid) (a) the cost of
the Survey, (b) any escrow fees charged by the Title Company, (c) any and all
taxes, charges and assessments as set forth in Section 7.3 hereof (if any),
and (d) the basic premium for the Owner's Policy of Title Insurance (the
"Title Policy"), and, if desired by Purchaser, the premium for the
modification of the survey exception for the Title Policy. Purchaser shall pay
the recording fees on the Deed. Seller shall pay its own attorneys' fees and
Purchaser's attorneys' fees; provided, however, in the event of any litigation
arising hereunder, the prevailing party shall be entitled to recover, as part
of any judgment rendered, reasonable attorneys' fees and cost of suit from the
other party. Except as otherwise provided in this Section 7.2, all other
expenses hereunder shall be paid by the party incurring such expenses.
7.3 Prorations and Post-Closing Obligations; Tax Escrow.
Seller, under the effect of the Lease Agreement (as hereinafter defined) is
responsible, and will continue to be responsible, for the payment of all real
estate taxes, personal property taxes, assessments, property owner assessments
and all other items of expense which relate to the Property, all of which is
more specifically discussed in the Lease Agreement (as hereinafter defined).
Therefore, no items of expense or income shall be prorated with respect to the
Property at the Closing, and, if not sooner paid by Seller, Seller shall escrow
with the Title Company at Closing an amount equal to the taxes and assessments
due for the Property for calender year 2001 based upon the 2001 tax statements
delivered to Purchaser as part of the Submission Matters, the Title Company
shall cause such taxes and assessments to be paid directly to the applicable
taxing authority(ies) pursuant to the terms of an escrow agreement to be
executed at Closing, the form of which shall be
9
reasonably acceptable to Seller and the Title Company (the "Tax Escrow
Agreement"). The provisions of this Section 7.3 shall survive Closing.
7.4 Interim Responsibilities of Seller.
(a) Between the date of this Contract and the Closing Date, Seller
will or will cause the manager of the Property to (i) continue
to operate the Property in accordance with its present operating
policy; (ii) keep and maintain the Property in at least as good
condition and repair as it exists as of the date of this
Contract, subject to normal wear and tear and to casualty
losses; and (iii) maintain, in force and effect property and
liability insurance with respect to damage or injury to person
or property occurring on the Property in at least such amounts
as are maintained by Seller as of the date of this Contract.
(b) Between the date of this Contract and the Closing Date, Seller
will not enter into any new contract, lease or agreement
affecting the operation, management or leasing of the Property.
7.5 Deliveries at Closing. At the Closing:
(a) Seller, at its sole expense, shall deliver to Purchaser (unless
otherwise specified) the following:
(1) a Special Warranty Deed (the "Deed") duly executed and
acknowledged by Seller, conveying to Purchaser the Land
and Improvements, as well as all fixtures owned by Seller,
in indefeasible fee simple, free and clear of any lien,
encumbrance or exception other than the Permitted
Exceptions in form and substance as set forth on Exhibit
"B" attached hereto and made a part hereof for all
purposes.
(2) a Blanket Conveyance, Xxxx of Sale and Assignment, duly
executed by Seller, conveying to Purchaser the Personalty,
free and clear of any lien and encumbrance other than the
Permitted Exceptions, in form and substance as set forth
on Exhibit "C" attached hereto and made a part hereof for
all purposes;
(3) the Title Policy issued by the Title Company, conforming
to the requirements of Article IV above, insuring
Purchaser's title in the amount of the Purchase Price and
containing no exceptions other than (a) the standard
printed exceptions (but with the survey exception being
modified to read "shortages in area"); (b) the lien for
current taxes, and subsequent assessments for prior years
due to change in land usage or ownership; (c) the
Permitted Exceptions; and (d) other exceptions, if any,
which Purchaser may approve in writing in its sole
discretion.
(4) a non-foreign certificate executed by Seller, as required
by the Foreign Investment in Real Property Tax Act, as
amended;
10
(5) a restatement of the representations and warranties set
out in Section 6.1 hereof (subject to the "knowledge"
limitation set forth in Section 6.1);
(6) possession of the Property (subject to the terms and
provisions of the Lease Agreement (as hereinafter
defined));
(7) such evidence of the authority and capacity of Seller and
its representatives as Purchaser and/or the Title Company
may reasonably require;
(8) to the extent in Seller's possession, the original Service
Contracts, Certificates of Occupancy (if not delivered
pursuant to subsection 5.1(c) above), plans and
specifications;
(9) all licenses, permits, books, tenant records, plans,
specifications and other items in Seller's possession
related to the operation of the Property (i.e., not
including Seller's internal records or income tax
records); provided, however, Seller may elect to retain
all or some of such items in accordance with the terms and
provisions of the Lease Agreement (as hereinafter
defined);
(10) any and all instruments (in form and substance
satisfactory to Purchaser) necessary and/or desirable to
effect a full and complete release of any and all right,
title, lien and/or interest(s) of Xxxxx Fargo Bank
(Texas), National Association (now known as Xxxxx Fargo
Bank Texas, National Association), as administrative agent
for the Lenders reflecting record title as follows: FIRST
SECURITY BANK, NATIONAL ASSOCIATION (now known as XXXXX
FARGO BANK NORTHWEST, NATIONAL ASSOCIATION), not
individually, but solely as the Owner Trustee under the
Ultrak Trust 1996-1 ("Xxxxx Fargo"), in and/or to the
Property (or any item or portion thereof);
(11) the Lease Agreement, duly executed by Seller, leasing to
Seller the property described therein, together with (a)
the Guaranty Agreements attached to the Lease Agreement,
duly executed by the guarantors named therein, and (b) the
Memorandum of Lease Agreement and Purchase Option (the
"Memorandum"), duly executed by Seller, all in form and
substance as set forth on Exhibit "D" attached hereto and
made a part hereof for all purposes (the Lease Agreement,
the Guaranty Agreements and the Memorandum are sometimes
referred to herein collectively as the "Lease Agreement");
(12) if taxes for calendar year 2001 are not paid by Seller at
Closing, the Tax Escrow Agreement, duly executed on behalf
of Seller, together with the amounts to be escrowed
thereunder as described in Section 7.3 above;
(13) the Warrant Agreement and the Warrant Certificate (each as
defined in Section 11.17 below), duly executed on behalf
of Ultrak, Inc., a Delaware corporation, in accordance
with Section 11.17 below;
(14) the cash payment for the Placement Fee payable to
Briarwood Capital Corporation, a Texas corporation, due in
accordance with the terms and provisions of Section 11.18
below; and
11
(15) such other instruments and documents as are in Seller's
possession, and are reasonably appropriate, necessary and
required by the Title Company or the Purchaser to complete
and evidence the transactions contemplated hereby.
(b) Purchaser shall deliver to Seller the following:
(1) the cash payment for the Purchase Price due in accordance
with the terms and provisions of this Contract;
(2) such evidence of the authority and capacity of Purchaser
and its representatives as Seller or the Title Company may
reasonably require;
(3) the Lease Agreement (including the Memorandum) duly
executed by Purchaser, leasing to Seller the property
described therein, in form and substance as set forth on
Exhibit "D" attached hereto and made a part hereof for all
purposes;
(4) if taxes for calendar year 2001 are not paid by Seller at
Closing, the Tax Escrow Agreement, duly executed on behalf
of Purchaser;
(5) the Warrant Agreement (as defined in Section 11.17 below),
duly executed on behalf of Purchaser; and
(6) such other instruments and documents as are reasonably
appropriate, necessary and required by Seller or the Title
Company in order to complete and evidence the transactions
contemplated hereby.
ARTICLE VIII
Conditions Precedent to Purchaser's
Obligations to Close
Purchaser's obligation to consummate the transactions contemplated
hereunder is conditioned upon satisfaction of each of the following conditions
at or prior to the Closing (or such earlier date as is specified with respect to
a particular condition):
(a) Purchaser shall have approved (or be deemed to have approved by
not terminating this Contract during the Review Period) all
inspections and inquiries provided for in this Contract
(including, without limitation, Article IV hereof);
(b) None of the representations and warranties of Seller set forth
in Article VI hereof shall be untrue or inaccurate in any
material respect; and
(c) All other conditions to Purchaser's obligations which are
specifically expressed in this Contract shall be satisfied.
12
In the event that any of the above conditions are not satisfied at or prior to
the Closing (or such earlier date as is specified with respect to a particular
condition), Purchaser may terminate this Contract, which termination shall be a
Permitted Termination as provided in Section 9.1 hereof.
ARTICLE IX
Termination, Default and Remedies
9.1 Permitted Termination. If this Contract is terminated by either
Seller or Purchaser pursuant to a right expressly given it to do so by any
other Section of this Contract (herein referred to as a "Permitted
Termination"), except for a termination by Seller because of the default of
Purchaser, the Xxxxxxx Money, together with any accrued interest thereon,
shall immediately be returned to Purchaser and this Contract shall thereafter
be null and void.
9.2 Default by Seller. Seller shall be in default hereunder upon the
occurrence of any one or more of the following events:
(a) Any of Seller's warranties or representations set forth herein
are untrue or inaccurate in any material respect when made or at
Closing; or
(b) Seller shall fail to meet, comply with or perform any covenant,
agreement, or obligation within the time limits and in the terms
required in this Contract, for any reason other than a Permitted
Termination or Purchaser's default; or
(c) Seller shall fail to deliver at the Closing any of the items
required of Seller in Section 7.5(a) hereof, for any reason
other than a Permitted Termination or Purchaser's default,
except for immaterial failures which Seller remedies promptly
after notice from Purchaser.
In the event of a default by Seller hereunder, Purchaser may, at Purchaser's
sole option (and as its sole and exclusive remedies), do any of the following:
(i) waive the default; or
(ii) terminate this Contract by notice to Seller at or prior to
the Closing and receive a refund of the Xxxxxxx Money and
interest; or
(iii) receive a refund of the Xxxxxxx Money and interest, and
enforce specific performance of this Contract to cause
Seller to deliver the items required of Seller at Closing
pursuant to Section 7.5(a) hereof.
In addition, and notwithstanding anything to the contrary contained above, if
Seller voluntarily sells, mortgages or otherwise disposes of the Property to
another party (i.e., other than Purchaser) during the term of this Contract,
then Purchaser, at its sole option (and in addition to the above-listed
remedies), may xxx Seller for damages.
9.3 Default by Purchaser. Purchaser shall be in default hereunder if
Purchaser shall fail to deliver at the Closing any of the items required of
Purchaser in Section 7.5(b) and Section 7.5(c)
13
hereof, for any reason other than a Permitted Termination or Seller's default.
In the event of a default by Purchaser hereunder, Seller, as Seller's sole and
exclusive remedy for such default, shall be entitled to terminate this
Contract by notice to Purchaser and retain Purchaser's Xxxxxxx Money, it being
agreed between Purchaser and Seller that such sum is, in effect, an option fee
and liquidated damages, inasmuch as Seller does not have the remedy of
specific performance, nor the remedy of actual damages.
ARTICLE X
Indemnification
Except as specifically stated to the contrary elsewhere in this
Contract, Seller does hereby agree to indemnify and hold Purchaser harmless of,
from and against all claims and causes of action, losses, damages (including
attorneys fees) now existing or that may hereafter arise from or grow out of
Seller's operation of the Property on or before the Closing Date, and for
hazardous materials known to Seller on or under the Property on or before the
Closing Date, and in accordance with the Lease Agreement.
ARTICLE XI
Miscellaneous
11.1 Condemnation and Casualty Loss. All risk of loss to the Property
shall remain upon Seller prior to Closing. If prior to Closing, the Property
shall be damaged or condemned to a material extent, Seller may terminate this
Contract by written notice to Purchaser within the earlier to occur of (i) five
(5) business days following discovery by Seller of such taking or damage, or
(ii) the Closing Date; or Purchaser may either terminate this Contract by
written notice to Seller within the earlier to occur of (a) five (5) business
days following Seller's written notice to Purchaser disclosing such taking or
damage, or (b) the Closing Date, or Purchaser shall be conclusively deemed to
have accepted such taking or damage and waived any right to terminate this
Contract as a result thereof. If Seller shall not have terminated this Contract,
and if Purchaser elects (or is deemed to have elected) to accept such taking or
damage and waive any right to terminate this Contract as a result thereof,
despite said material damage or condemnation, there shall be no reduction in the
Purchase Price (except as specifically prescribed below), and (i) Seller shall
assign to Purchaser at Closing (or deliver to Purchaser at Closing, if already
received by Seller and not utilized for restoration), without recourse or
warranty, all of Seller's right, title and interest in and to all insurance and
condemnation proceeds resulting or to result from said damage or condemnation,
and (ii) Seller shall credit Purchaser at the Closing with the "deductible"
applicable to Seller's insurance coverage. Unless otherwise provided herein, the
term "material" shall mean damage or condemnation resulting in a loss equal in
amount to $200,000.00 or more. If, prior to Closing, the Property shall be
damaged or condemned to less than a material degree, Purchaser shall (despite
such damage or condemnation) close and consummate the purchase of the portion of
the Property still remaining (after any such condemnation or damage without any
reduction in the Purchase Price (except as specifically prescribed below), and
(i) Seller shall at Closing assign to Purchaser (or deliver to Purchaser at
Closing, if already received by Seller and not utilized for restoration),
without recourse or warranty, (A) any and all insurance proceeds theretofore
received by Seller in connection with such damage and any and all rights of
Seller in and to any claims therefor pursuant to any
14
insurance policies then existing in Seller's favor and applicable to such
damage, and (B) any and all condemnation proceeds received by Seller in
connection with such condemnation and any and all claims therefor existing on
the part of Seller and applicable to such condemnation, and (ii) Seller shall
credit Purchaser at the Closing with the "deductible" applicable to Seller's
insurance coverage.
11.2 Brokerage. Each party hereto represents to the other that it has
not authorized any broker or finder to act on its behalf in connection with the
sale and purchase transaction contemplated hereby and that it has not dealt with
any broker or finder purporting to act for any other party. Each party hereto
agrees to indemnify and hold harmless the other party from and against any and
all liabilities, costs, damages and expenses of any kind or character arising
from any claims for brokerage or finder's fees, commissions or other similar
fees in connection with the transactions covered by this Contract insofar as
such claims shall be based upon alleged arrangements or agreements made by such
party or on its behalf, which indemnity shall (notwithstanding anything to the
contrary contained or implied elsewhere in this Contract) expressly survive any
termination or Closing of this Contract.
11.3 Notices. Any notices, consents or other communications required or
permitted to be given pursuant to this Contract must be in writing and shall be
deemed to have been delivered (a) if delivered in person, via courier, or by
facsimile when received at the address of the person to whom notice is given,
(b) if sent by a nationally recognized overnight delivery service (e.g., Federal
Express, UPS, Airborne Courier), on the first (1st) business day after receipt
by such delivery service for overnight delivery, or (c) if sent by certified
United States Mail (except where actual receipt is specified in this Contract),
on the earlier of the date actually received or two (2) business days after
deposited in a receptacle provided by the United States Post Office, addressed
to the intended parties at the following respective addresses:
If intended for Seller: Ultrak Operating, L.P.
c/o Ultrak, Inc.
0000 Xxxxxx Xxxxx Xxxxx
Xxxxxxxxxx, Xxxxx 00000
Attention: Xxxxx Xxxxxx, CFO
Fax No.: (000) 000-0000
With a copy to: Xxxxxxxx & Bromberg, P.C.
0000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000-0000
Attention: Xxxx X. Xxxxxxxx, Esq.
Fax No.: (000) 000-0000
If intended for Purchaser: Briarwood Capital Corporation
0000 Xxxxxx Xxxxx Xxxxxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: X. Xxxxxx Xxxxxx
Fax No.: (000) 000-0000
15
With a copy to: Jenkens & Xxxxxxxxx, P.C.
0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000-0000
Attention: Xxxxxxxxxxx X. Xxxxx, Esq.
Fax No.: (000) 000-0000
If intended for Title Company: Republic Title of Texas, Inc.
0000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000
Attention: C. Xxxxxxx Xxxxx
Fax No.: (000) 000-0000
or to such other substitute address and/or addressee as any party hereto shall
designate by written notice to the other party in accordance with the terms of
this Section 11.3; provided, however, that no such notice of change of address
and/or addressee shall be effective unless and until actually received by the
party to whom such notice is sent.
11.4 Applicable Law. This Contract shall be governed by and construed
in accordance with the laws of the State of Texas. This Contract is
performable and venue for any action hereunder shall be in Dallas County,
Texas.
11.5 Entire Agreement; Modifications. This Contract embodies and
constitutes the entire understanding between the parties with respect to the
transactions contemplated herein, and all prior or contemporaneous agreements,
understandings, representations and statements (oral or written) are merged
into this Contract. Neither this Contract nor any provision hereof may be
waived, modified, amended, discharged or terminated except by an instrument in
writing signed by the party against whom the enforcement of such waiver,
modification, amendment, discharge or termination is sought, and then only to
the extent set forth in such instrument.
11.6 Assignment. Purchaser may assign its rights under this Contract
to any person(s) or entity(ies) of Purchaser's choosing, whether or not
affiliated with Purchaser; provided, however, that (a) no assignment shall
release Purchaser from its obligations under this Contract, and (b) if the
assignee is not affiliated with Purchaser and/or X. Xxxxxx Xxxxxx, then such
assignee shall be of recognized good business reputation, as determined by the
parties in their reasonable discretion (respectively).
11.7 Captions; Construction. The captions which have been used
throughout this Contract have been inserted for convenience of reference only
and do not constitute matter to be construed in interpreting this Contract.
Words of any gender used in this Contract shall be held and construed to
include any other gender and words in the singular number shall be held to
include the plural, and vice versa, unless the context requires otherwise. The
words "herein," "hereof," "hereunder," and other similar compounds of the
words "here" when used in this Contract shall refer to the entire Contract and
not to any particular provision or section.
11.8 Time is of the Essence. With respect to all provisions of this
Contract, time is of the essence.
11.9 Invalid Provisions. If any term, provision, condition or
covenant of this Contract or the application thereof to any party or
circumstance shall, to the extent, be held invalid or
16
unenforceable, the remainder of this Contract, or the application of such
term, provision, condition or covenant to persons or circumstances other than
those as to whom or which it is held invalid or unenforceable, shall not be
affected thereby, and each term and provision of this Contract shall be valid
and enforceable to the fullest extent permitted by law, and said invalid or
unenforceable term, provision, condition or covenant shall be substituted by a
term, provision, condition or covenant as near in substance as may be valid
and enforceable.
11.10 Binding Effect. This Contract shall be binding upon and inure
to the benefit of Seller and Purchaser, and their respective heirs, personal
representatives, successors and assigns. Purchaser may, subject to the
provisions of Section 11.6 hereof, assign its rights hereunder provided that
Purchaser delivers to Seller a copy of the fully executed instrument pursuant
to which Purchaser assigns Purchaser's rights hereunder and provided that
Purchaser's assignee expressly assumes all of Purchaser's obligations under
this Contract. Except as expressly provided herein, nothing in this Contract
is intended to confer on any person, other than the parties hereto and their
respective heirs, personal representatives, successors and assigns, any rights
or remedies under or by reason of this Contract.
11.11 Counterpart Execution. This Contract may be executed in several
counterparts, each of which shall be deemed an original, and all of which
counterparts together shall constitute one and the same instrument.
11.12 Further Acts. In addition to the acts recited in this Contract
to be performed by Seller and Purchaser, Seller and Purchaser agree to perform
or cause to be performed at the Closing or after the Closing any and all such
further acts as may be reasonably necessary to consummate the transactions
contemplated hereby.
11.13 Exhibits. All references to Exhibits contained herein are
references to Exhibits attached hereto, all of which are made a part hereof
for all purposes the same as if set forth herein verbatim, it being expressly
understood that if any Exhibit attached hereto which is to be executed and
delivered at Closing contains blanks, the same shall be completed correctly
and in accordance with the terms and provisions contained herein and as
contemplated herein prior to or at the time of execution and delivery thereof.
11.14 Date of Contract. All references to the "date of this Contract"
or similar references as used herein shall be deemed to mean the later of the
two dates on which this Contract is signed by the Seller or Purchaser, as
indicated by their signatures below, which later date shall be the date of final
execution and agreement by the parties hereto.
11.15 Attorney's Fees. If either party shall be required to employ an
attorney to enforce or define the rights of such party hereunder, the
prevailing party shall be entitled to recover reasonable attorney's fees and
costs of suit from the other party.
11.16 Offer and Acceptance. If this Contract is executed first by the
Purchaser and then delivered to Seller, it shall be construed as an offer to
purchase the Property from Seller by Purchaser on the terms and conditions,
and for the Purchase Price stated herein. If executed first by Seller and then
delivered to Purchaser, it shall constitute an offer to sell the Property to
Purchaser by Seller on the terms and conditions and to the Purchase Price
stated herein. In either event, the offer made herein, unless sooner
terminated or withdrawn by notice in writing by the party making such offer,
shall automatically lapse and terminate at 6:00 p.m., Central Daylight Savings
time, on December 12, 2001, unless, prior to such time, the party receiving
the offer has returned to the party making
17
the offer at least one fully executed counterpart of this Contract. Any
modification of the original offer made herein shall constitute a
counter-offer by the party initiating such modifications.
11.17 Stock Warrants. As a material inducement to Purchaser to enter
into this Contract and the transactions contemplated herein, Seller shall
cause Ultrak, Inc., a Delaware corporation, to execute and deliver to
Purchaser at Closing (a) the Warrant Agreement (the "Warrant Agreement") which
grants warrants for the purchase of 100,000 shares of common stock of Ultrak,
Inc., a Delaware corporation, at an exercise price of $1.55 per share
(collectively, the "Warrants"), in the form attached hereto as Exhibit "E" and
made a part hereof for all purposes, and (b) the Warrant Certificate, in the
form attached to the Warrant Agreement (the "Warrant Certificate").
11.18 Placement Fee. If, and only if, the transaction contemplated by
this Contract closes on or before the Closing Date, at Closing Seller shall
pay to Briarwood Capital Corporation, a Texas corporation, a placement fee in
cash in an amount equal to $25,000.00 (the "Placement Fee") for its role in
this transaction.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
18
SELLER:
ULTRAK OPERATING, L.P.,
a Texas limited partnership
By: Ultrak GP, Inc., a Delaware corporation,
its General Partner
By:_________________________________________
Executed by Seller on Name:_______________________________________
December 11, 2001 Title:______________________________________
PURCHASER:
BRIARWOOD CAPITAL CORPORATION,
a Texas corporation
Executed by Purchaser on By: _______________________________________
December 13, 2001 X. Xxxxxx Xxxxxx, President
Ultrak, Inc., a Delaware corporation, joins in the execution of this Contract
for sole the purpose of acknowledging and agreeing to the terms and provisions
set forth in Sections 6.1(o), 7.5(a)(13) and 11.17 of this Contract.
ULTRAK, INC., a Delaware corporation
By:_________________________________________
Executed on Name:_______________________________________
December 11, 2001 Title:______________________________________
[CONTINUED ON FOLLOWING PAGE]
19
RECEIPT OF XXXXXXX MONEY
AND AGREEMENT OF TITLE COMPANY
Republic Title of Texas, Inc., a Texas corporation (the "Title
Company") hereby acknowledges the receipt of the following:
(i) one (1) fully signed and executed copy of this Contract; and
(ii) Xxxxxxx Money in the amount of $100,000.00.
The Title Company hereby agrees to hold the Xxxxxxx Money Deposit as
contemplated by this Contract and to dispose of it in strict accordance with the
terms and provisions of this Contract.
REPUBLIC TITLE OF TEXAS, INC.,
a Texas corporation
By:_________________________________________
C. Xxxxxxx Xxxxx
Title:______________________________________
Date: December 14, 2001
20
EXHIBIT "A"
LEGAL DESCRIPTION
21
EXHIBIT "B"
SPECIAL WARRANTY DEED
STATE OF TEXAS ss.
ss.
COUNTY OF XXXXXX xx.
ULTRAK OPERATING, L.P., a Texas limited partnership ("Grantor"), for
and in consideration of the Sum of Ten and No/100 Dollars ($10.00), and other
good and valuable consideration paid in cash to Grantor by BRIARWOOD CAPITAL
CORPORATION, a Texas corporation ("Grantee"), the receipt and sufficiency of
which are hereby acknowledged and confessed, subject to the exceptions, liens,
encumbrances, terms and provisions hereinafter set forth and described, has
GRANTED, BARGAINED, SOLD and CONVEYED, and by these presents does hereby GRANT,
BARGAIN, SELL and CONVEY, unto Grantee that certain real estate consisting of
approximately 14.002 acres of land (the "Land") situated in Xxxxxx County,
Texas, and being more particularly described in Exhibit "A" attached hereto and
incorporated herein by reference for all purposes and all fixtures (to the
extent owned by Grantor) and improvements situated thereon (the "Improvements").
TOGETHER WITH, all and singular, the rights, benefits, privileges,
easements, rights-of-way, tenements, hereditaments, appurtenances and interests
thereon or in anywise appertaining thereto including, without limitation, all of
Grantor's right, title and interest in and to (i) strips or gores, if any,
between the Land and any abutting properties; (ii) any land lying in or under
the bed of any street, alley, road or right-of-way open or proposed, abutting or
adjacent to the Land; (iii) rights-of-way; (iv) rights of ingress or egress or
other interests in, on or to any land, highway, street, road or avenue, open or
proposed in, on, across, in front of, abutting or adjoining the Land (the Land,
Improvements, rights, benefits, privileges, easements, tenements, hereditaments,
appurtenances, improvements and interests being hereinafter referred to
collectively as the Property").
This conveyance is made subject and subordinate to the encumbrances and
exceptions ("Permitted Exceptions") described in Exhibit "B" attached hereto and
incorporated herein by reference for all purposes, but only to the extent they
affect or relate to the Property, and without limitation or expansion of the
scope of the special warranty herein contained.
TO HAVE AND TO HOLD the Property, subject to the Permitted Exceptions
as aforesaid, unto Grantee, and Grantee's successors and assigns, forever; and
Grantor does hereby bind Grantor, and Grantor's successors, to WARRANT and
FOREVER DEFEND, all and singular, the Property, subject to the Permitted
Exceptions unto Grantee, and Grantee's successors and assigns, against every
person whomsoever lawfully claiming or to claim the same or any part thereof by,
through or under Grantor, but not otherwise.
22
EXECUTED as of the _____ day of December, 2001.
GRANTOR:
ULTRAK OPERATING, L.P.,
a Texas limited partnership
By: Ultrak GP, Inc., a Delaware corporation,
its General Partner
By:_____________________________________
Name:___________________________________
Title:__________________________________
STATE OF TEXAS ss.
ss.
COUNTY OF _______________ss.
This instrument was acknowledged before me on the ____ day of December,
2001, by _______________________________________, _____________________________
of Ultrak GP, Inc., a Delaware corporation, in its capacity as General Partner
of ULTRAK OPERATING, L.P., a Texas limited partnership, on behalf of such
corporation and limited partnership.
______________________________
Notary Public in and for
the State of Texas
23
EXHIBIT "C"
BLANKET ASSIGNMENT, XXXX OF SALE
AND ASSUMPTION AGREEMENT
STATE OF TEXAS ss.
ss.
COUNTY OF XXXXXX xx.
By a Special Warranty Deed (the "Deed") of even date herewith, ULTRAK
OPERATING, L.P., a Texas limited partnership ("Seller") conveyed to BRIARWOOD
CAPITAL CORPORATION, a Texas corporation ("Purchaser"), for the sum of Ten and
No/100 Dollars ($10.00) and other good and valuable consideration, certain land
and improvements located thereon (the "Property"), as described on Exhibit "A"
attached hereto and made a part hereof for all purposes.
NOW, THEREFORE, in connection with the above-described conveyance of
the Property, and for the consideration above specified, the receipt and
sufficiency of which is expressly confessed and acknowledged: The Seller has
BARGAINED, SOLD, DELIVERED, ASSIGNED, SETOVER and CONVEYED, and by these
presents does hereby BARGAIN, SELL, DELIVER, ASSIGN, SET OVER and CONVEY unto
the Purchaser, all of Seller's right, title and interest in and to the following
described personal property owned by Seller and relating to the Property
(collectively, the "Personal Property"):
(a) all mechanical systems, fixtures and equipment; electrical
systems, fixtures and equipment; heating fixtures, systems
and equipment; air conditioning fixtures, systems and
equipment; furniture, carpets, drapes and other
furnishings; refrigerators, stoves and other appliances;
maintenance equipment and tools; and all other machinery,
equipment, fixtures and personal property of every kind and
character located in or on and used in connection with the
ownership or operation of the Property; together with all
of the Seller's right, title and interest as lessee under
any lease or rental agreements covering any such personal
property;
(b) all of Seller's right, title and interest, if any, in and
to any other intangible property owned by Seller, as the
same pertains to the Property;
(c) all of Seller's right, title and interest in and to the
agreements, if any, relating to the Property (the "Service
Contracts") listed on Exhibit "B" attached hereto;
(d) all of Seller's right, title and interest in and to any and
all (i) warranties, guarantees, indemnities and claims;
(ii) licenses, permits or similar documents; (iii)
telephone exchanges, tradenames, marks and other
identifying materials; (iv) plans, drawings,
specifications, surveys, engineering reports and other
technical descriptions; (v) insurance contracts or policies
to the extent Purchaser elects to take assignment thereof;
and (vi) other property owned or held by Seller which
relate in any way, to
24
the design, construction, ownership, use, maintenance,
service or operation of the Property; and
(e) all of Seller's right, title and interest in and to all
promotional material, rental material and forms, records
relating to the tenants and leases, and other materials of
any kind in Seller's possession used in the continuing
operation of the Property.
To have and to hold, all and singular, the Personal Property unto the
Purchaser forever so that neither Seller nor its successors or assigns (other
than Purchaser and those claiming through Purchaser, including, without
limitation, Seller under and by virtue of (and in accordance with the terms and
provisions of) the Lease Agreement) shall at any time hereafter have, claim or
demand any right or title thereto.
THIS SALE IS MADE WITHOUT ANY WARRANTIES OR REPRESENTATIONS WHATSOEVER,
WHETHER EXPRESS OR IMPLIED, EXCEPT AS MAY BE EXPRESSLY PROVIDED FOR IN THE
CONTRACT OF SALE BETWEEN SELLER AND PURCHASER COVERING THE PROPERTY.
SPECIFICALLY, THE PERSONAL PROPERTY IS OTHERWISE SOLD ON AN "AS IS, WHERE IS"
BASIS, WITH ALL FAULTS.
This Xxxx of Sale and the Contract of Sale between Seller and Purchaser
covering the Property constitutes the entire agreement between the Seller and
the Purchaser pertaining to the sale and assignment of the Personal Property to
Purchaser, and supersedes all prior and contemporaneous agreements and
understandings of the Seller and the Purchaser in connection therewith. No
covenant, representation or condition not expressed herein shall be binding upon
the Seller or the Purchaser or shall affect or be effective to interpret, change
or restrict the provisions of this Xxxx of Sale.
This Xxxx of Sale and the provisions herein contained is made for the
benefit of the Purchaser, its successors and assigns.
EXECUTED the _____ day of December, 2001.
SELLER:
ULTRAK OPERATING, L.P.,
a Texas limited partnership
By: Ultrak GP, Inc., a Delaware corporation,
its General Partner
By:_____________________________________
Name:___________________________________
Title:__________________________________
25
EXHIBIT "D"
THE LEASE AGREEMENT
[attached following this page]
0000 Xxxxxx Xxxxx Xxxxx
Xxxxxxxxxx, Xxxxxx Xxxxxx, Xxxxx
LEASE AGREEMENT
by and between
BRIARWOOD WATERS RIDGE LP
and
ULTRAK OPERATING, L.P.
TABLE OF CONTENTS
Page
----
1. Premises and Term.........................................................................................1
2. Construction; Reimbursement by Landlord...................................................................2
3. Minimum Rent; Security Deposit............................................................................3
4. Payments..................................................................................................4
5. Use.......................................................................................................4
6. Utility Charges...........................................................................................5
7. Taxes.....................................................................................................5
8. Insurance.................................................................................................8
9. Payment of Taxes and Insurance by Landlord...............................................................12
10. Repairs..................................................................................................12
11. Alterations..............................................................................................13
12. Equipment, Fixtures and Signs on Premises................................................................13
13. Damage by Fire or Other Casualty.........................................................................14
14. Condemnation.............................................................................................15
15. Liability and Indemnification............................................................................16
16. Assignment and Subletting................................................................................18
17. Default..................................................................................................20
18. Inspection by Landlord...................................................................................23
19. Covenant of Title and Quiet Enjoyment....................................................................23
20. Holding Over by Tenant...................................................................................23
21. Notice and Payments......................................................................................24
22. Net Lease................................................................................................26
23. Force Majeure............................................................................................27
24. Waiver of Subrogation....................................................................................27
25. Recording................................................................................................27
26. Purchase Option..........................................................................................27
27. Tenant's Information.....................................................................................28
28. Gender and Number........................................................................................29
29. Binding Effect...........................................................................................29
30. Entire Agreement.........................................................................................29
31. Captions.................................................................................................29
32. Terms Held Invalid.......................................................................................29
33. Attorney's Fees..........................................................................................29
34. Waiver of Repurchase Option..............................................................................29
35. Estoppels................................................................................................30
36. Mechanic's Liens.........................................................................................30
37. No Joint Venture.........................................................................................30
38. Broker...................................................................................................31
39. Date of Lease............................................................................................31
40. No Representations.......................................................................................31
41. Binding Effect...........................................................................................31
42. Counterparts.............................................................................................31
43. Rental Tax...............................................................................................32
44. Landlord's Lien..........................................................................................32
45. Limitation of Actions....................................................................................32
46. Waiver of Jury Trial.....................................................................................33
47. Execution and Approval of Lease..........................................................................33
48. Governing Law............................................................................................34
49. Hazardous Materials......................................................................................34
50. Intention of Parties; Contingent Security Interest.......................................................35
LEASE AGREEMENT
THIS LEASE AGREEMENT (this "Lease") dated effective as of December
_____, 2001, is by and between BRIARWOOD WATERS RIDGE LP, a Texas limited
partnership (hereinafter called "Landlord"), and ULTRAK, OPERATING, L.P., a
Texas limited partnership (hereinafter called the "Tenant").
1. Premises and Term. Subject to the terms of this Lease, Landlord
hereby leases to Tenant, and Tenant hereby leases from Landlord, that certain
parcel of real property (the "Property") located in the City of Lewisville,
County of Xxxxxx, State of Texas, the same being more particularly described by
metes and bounds on Exhibit "A" attached hereto and made a part hereof for all
purposes, and as shown on Exhibit "B" attached hereto and made a part hereof for
all purposes, including all improvements now or hereafter to be constructed
thereon (the same, as modified in accordance with Article 11 below is herein
called the "Building") and all fixtures and accessory improvements now or
hereafter thereon, including all roadway, parking areas and landscaped areas now
or hereafter located thereon (collectively such Building, fixtures and
improvements are hereinafter referred to either individually or collectively as
the "Improvements"), and all mechanical systems, fixtures and equipment
(including, but not limited to, compressors, engines, elevators and escalators),
electrical systems, fixtures and equipment; heating fixtures, systems and
equipment, air conditioning fixtures, systems and equipment; plumbing fixtures,
systems and equipment, all furniture, carpets, drapes and other furnishings;
refrigerators, stoves and other appliances, maintenance equipment and tools; and
all other machinery, equipment, fixtures and personal property of every kind and
character, and all accessories and additions thereto, located in or on or in the
area of the Property and/or the Improvements, or used in connection with the
Property or the Improvements or the operations thereon (collectively, and as
applicable, the "Personalty") (the Improvements, the Personalty and the
Property, together with all easements, rights, privileges and amenities
otherwise appurtenant to such property are hereinafter referred to collectively
as the "Premises"). Tenant shall lease the Premises for a term commencing on the
Commencement Date (as defined below) and expiring on the last day of the
thirtieth (30th) full calendar month following
1
the Commencement Date. The "Commencement Date" of this Lease, and Tenant's
obligation to begin paying rent under this Lease, shall be the date of this
Lease first above written (i.e., December _____, 2001).
2. Construction; Warranties.
(a) As of the date of this Lease, there are no construction
obligations with respect to the Premises. Landlord is not deemed to represent
and/or warrant that the Premises comply with any and all laws, ordinances,
orders, rules, and regulations of all governmental bodies (state, federal, and
municipal) applicable to or having jurisdiction over the use, occupancy,
operation, and maintenance of the Leased Premises and the Project, including
without limitations the Access Laws (as hereinafter defined) (those laws,
ordinances, orders, rules, decisions, and regulations being called "Applicable
Laws"). The "Access Laws" are defined herein collectively as all applicable
existing and future environmental laws and the provisions of the Americans With
Disabilities Act of 1990 (as amended), the Texas Architectural Barriers Act (as
amended) [Tex. Rev. Civ. Stat. Xxx. Art. 9102], and any similar existing or
future law, rule or regulation relating to access by disabled persons to the
Premises. Tenant, at its sole cost and expense, is responsible for the Premises
and Tenant's business operations at the Premises and the Property complying with
Applicable Laws (including, without limitation, the Access Laws), and Tenant
shall indemnify and hold harmless Landlord in connection with any failure of the
Premises and/or Tenant's business operations to so comply. Tenant shall be
responsible for (i) the payment or other release of all claims by contractors,
subcontractors and/or other suppliers, and (ii) all maintenance, repair and
replacements with respect to the Premises during the term of this Lease.
Landlord shall have no financial obligation with respect to the Premises
(including, without limitation, the Improvements), and any costs in connection
therewith shall be borne by Tenant, from and against which Tenant shall
indemnify and hold harmless Landlord.
(b) Landlord hereby permits Tenant to retain, during the term of
this Lease, all warranties and guarantees pertaining to Improvements and
equipment erected or installed upon the Premises. In the event of termination of
this Lease when any warranties or guarantees are still applicable, Tenant hereby
assigns to Landlord effective as of the date of termination all such warranties
and guaranties pertaining to the Improvements and equipment erected or installed
upon the Premises
2
(including, without limitation, all heating and air conditioning equipment,
and all equipment used in connection with Tenant's business operations,
installed upon the Premises).
3. Minimum Rent; Security Deposit.
(a) Commencing on the Commencement Date and continuing throughout
the term of this Lease, Tenant shall pay to Landlord minimum rental (the
"Minimum Rent") for the Premises at the rate of SEVEN HUNDRED TWENTY THOUSAND
AND NO/100 DOLLARS ($720,000.00) per annum, payable in monthly installments, in
advance, of SIXTY THOUSAND AND NO/100 DOLLARS ($60,000.00) per month. The first
monthly installment of Minimum Rent and the last monthly installment of Minimum
Rent (such installment of Minimum Rent to be applied to (i) the thirtieth (30th)
full calendar month of the term of this Lease in the event this Lease expires on
its own terms without the default of Tenant, or (ii) the twenty-fourth (24th)
full calendar month in the event Tenant properly and validly exercises its
Purchase Option pursuant to Section 26 below) shall be due and payable on or
before the Commencement Date of this lease, and each subsequent monthly
installment shall be due and payable on or before the first day of each
succeeding calendar month during the term of this Lease. Rent for any fractional
month at the beginning or the end of the term of this Lease, shall be prorated
on a per diem basis.
(b) Tenant shall pay a deposit in an amount equal to $60,000.00
(the "Security Deposit") to Landlord upon execution of this Lease as security
for the performance by Tenant of its obligations under this Lease. The Security
Deposit is not held in trust for Tenant, does not bear interest, and is not an
advance payment of Rent or a measure of Landlord's damages for a default by
Tenant. If Tenant defaults in the performance of any of its obligations under
this Lease, Landlord may, without prejudice to any other remedy, use the
Security Deposit to the extent necessary to make good any arrearages in Rent or
any other sum for which Tenant is in default and any other damage, injury,
expense, or liability caused to Landlord by the default. If Landlord so applies
any part of the Security Deposit, Tenant shall pay to Landlord on demand the
amount necessary to restore the Security Deposit to its original amount. If
Tenant is not then in default under this Lease, Landlord shall return any
remaining balance of the Security Deposit to Tenant within sixty (60) days after
the later to occur of (1) the termination or expiration of this Lease or (2)
surrender by Tenant of
3
possession of the Leased Premises to Landlord in accordance with this Lease.
If Landlord assigns its interest in the Leased Premises, Landlord may assign
the Security Deposit to the assignee, in which case Landlord has no further
liability for the return of the Security Deposit after the assignment and
Tenant shall look solely to the assignee for the return of the Security
Deposit. Tenant may not assign or encumber or attempt to assign or encumber
the Security Deposit. Landlord and its successors and assigns are not bound by
any actual or attempted assignment or encumbrance of the Security Deposit by
Tenant.
4. Payments. All payments of Minimum Rent and other sums due from
Tenant to Landlord shall be made to Landlord as the same shall become due,
without demand, reduction or set-off of any kind, by bank wire of immediately
available good funds, at the address as is specified in Section 21(c) of this
Lease, or to such other party or at such other place as hereinafter may be
designated by Landlord by written notice to the Tenant at least ten (10) days
prior to the next ensuing due date.
5. Use.
(a) Tenant shall use the Premises only for purposes consistent with
Tenant's current operations at the Premises, general warehouse, office, light
assembling and manufacturing purposes and in accordance with all Applicable
Laws, and with all Licenses (as hereinafter defined), and for no other use
without the prior written consent of Landlord (which consent may be withheld
in Landlord's sole, but reasonable, discretion). Tenant shall operate its
business in an efficient and reputable manner and Tenant shall not at any time
discontinue business operations from the Premises (except for legal holidays
and periods of renovation and repair) for more than ten (10) consecutive
business days, but shall in good faith continuously throughout the term of
this Lease conduct and carry on from Premises the type of business for which
the Premises are leased to Tenant.
(b) In no event shall the use of the Premises, now or in the future,
nor the design and construction (or any future alterations) of the
Improvements be such to violate any Applicable Laws (including, without
limitation, the Access Laws). Tenant shall, at its sole cost and expense,
comply with (and be responsible for compliance with) all legal requirements
and all Applicable Laws
4
(including, without limitation, the Access Laws) at all times during the term
of this Lease.
(c) Tenant shall not permit any objectionable noises or odors to
emanate from the Building; nor place or permit any radio, television,
loudspeaker or amplifier on the roof or outside the Building or where the same
can be seen or heard from outside the Building; nor place any antenna,
equipment, awning or other projection on the exterior of the Building; nor use
the areas outside the Building for conducting any advertising or marketing
program, or for the sale or distribution of goods; nor take any other action
which would constitute a nuisance or would endanger other or unreasonably
interfere with others; nor permit any unlawful or immoral practice to be
carried on or committed on the Premises.
(d) Tenant shall, at its sole cost and expense, maintain the Premises
in a neat, attractive condition at all times during the term of this Lease.
(e) Tenant shall procure, at its sole cost and expense, any and all
permits and licenses necessary, required or desirable for the transaction of
business in the Premises (collectively, the "Licenses") and shall otherwise
comply with all Applicable Laws (including, without limitation, the Access
Laws). Tenant may not, without the prior written consent of Landlord, which
consent may be withheld by Landlord in its sole and absolute discretion, (1)
assign or transfer the Licenses or any interest therein; (2) permit any
assignment of the Licenses or any interest therein by operation of law; (3)
grant any license, concession, or other right(s) in connection with the
Licenses to a third party; (5) mortgage, pledge, or otherwise encumber its
interest in the Licenses; or (6) permit the use of the Licenses by any parties
other than Tenant and its employees.
6. Utility Charges. Tenant shall pay all charges incurred for any
utility services used by Tenant on the Premises (including "hook-up" or
"tie-in" charges). Landlord shall not be liable for any interruption
whatsoever in any utility service(s).
7. Taxes.
(a) Tenant agrees that after the Commencement Date of this Lease,
Tenant shall pay as additional rent (and hold Landlord harmless from) before
they become delinquent all taxes (both real
5
and personal), assessments (both general and special), and governmental
charges of any nature whatsoever, levied upon or assessed against the Premises
(including, without limitation, the Property). Tenant shall deliver to
Landlord receipts or other reasonably satisfactory evidence of payment of all
such taxes, assessments and governmental charges so paid by Tenant. It is
agreed, however, that Tenant may, at its sole cost and expense, after giving
prior written notice to Landlord, dispute and contest the same, and in such
cases, such disputed item need not be paid until finally adjudged to be valid;
provided, however, that Tenant must post an appropriate bond or take another
measure necessary to keep the Premises free of tax liens. At the conclusion of
such contest, Tenant shall pay the items contested to the extent that they are
held valid, together with all terms, court costs, interest, penalties and
other expenses relating thereto. Notwithstanding the foregoing and anything to
the contrary contained herein, Tenant hereby agrees that until further notice
from Landlord, Tenant shall prepay all such taxes, assessments and
governmental charges in monthly installments of one-twelfth (1/12th) of the
annual amount thereof; and Tenant shall make to Landlord, in addition to the
rent reserved hereunder, monthly payments of one-twelfth (1/12th) of all such
taxes, assessments and governmental charges. To the extent of the payments
made by Tenant to Landlord pursuant to the immediately preceding sentence (but
only to the extent of such payments), Tenant shall be deemed to have satisfied
its obligations to pay such taxes, assessments and governmental charges and
Tenant shall not be required to provide the evidence of payment described
above and Landlord shall utilize such payments by Tenant in order to pay all
such taxes, assessments and governmental charges to be timely paid (with
Tenant agreeing to pay any difference upon demand by Landlord). If Landlord
fails to timely pay or cause payment of any such taxes, assessments and
governmental charges where Tenant has made monthly installments as provided in
this Section, and provided the failure to pay the applicable taxes,
assessments and governmental charges would constitute a lien upon Tenant's
property or Tenant's leasehold interest in the Premises will be subordinate to
the lien of such taxes, assessments and governmental charges, then Tenant may,
but shall have no obligation (to the extent Tenant has already made monthly
payments as provided in this section) to pay the applicable taxes, assessments
and/or governmental charges.
(b) Notwithstanding anything hereinabove to the contrary, if at any
time during the term of this Lease any assessment (either general or special)
is levied upon or assessed against the
6
Property or any part thereof, and such assessment is payable in installments
(without special hearing or legal action), Landlord shall not be required to
elect the manner of payment which provides for the greatest length of time to
pay in installments; and in such case Tenant shall be liable only for those
installments accruing during Tenant's tenancy under this Lease in the manner
selected by Landlord.
(c) If at any time during the term of this Lease, there shall be
levied, assessed or imposed a tax, charge or capital levy or otherwise (other
than a general gross receipts or income tax) on all or a portion of the rents
prescribed in this Lease, then even if such tax may be imposed by the
governmental authority upon Landlord, Tenant shall pay same in the same manner
as is provided above in Section 7(a) for real estate taxes.
(d) Tenant shall be liable for all taxes levied against personal
property and trade fixtures placed by Tenant and/or located in the Premises,
including, without limitation, the Personalty. If any such taxes are levied
against Landlord or Landlord's property and if Landlord elects to pay the same
or if the assessed value of Landlord's property is increased by inclusion of
personal property and trade fixtures placed by Tenant and/or located in the
Premises, including, without limitation, the Personalty, and Landlord elects
to pay the taxes based on such increase, Tenant shall pay to Landlord upon
demand that part of such taxes for which Tenant is primarily liable hereunder.
(e) Tenant shall be liable for any and all dues and other costs and
assessments levied by the Waters' Ridge Association, Inc., a Texas non-profit
corporation (including, without limitation, all annual and special assessments
under the Declaration (as defined below)) or any similar entity, and any
charges assessed against the Premises pursuant to any contractual covenants or
recorded declaration of covenants or the covenants, conditions and
restrictions of any other similar instrument affecting the Premises
(including, without limitation, that certain Master Declaration of Covenants,
Restrictions and Development Standards Applicable to Waters' Ridge dated June
1, 1984, recorded in Volume 1423, Page 680, Deed Records of Xxxxxx County,
Texas (as amended, the "Declaration")).
7
8. Insurance.
(a) Tenant shall, at its expense, maintain at all times during the
term of this Lease (and prior to the term of this Lease with respect to
activities of Tenant under this Lease at the Premises) insurance as set forth
below:
(1) Commercial General Liability Insurance (1986 ISO Form or
its equivalent) written on an "occurrence" basis with
respect to the business carried on, in or from the
Premises and Tenant's use and occupancy of the Premises
(including a contractual liability) in an amount not less
than $1,000,000 per occurrence and $2,000,000 general
aggregate per location for bodily injury and property
damages (or with increased limits as may be required from
time to time by Landlord by giving notice to Tenant) and
without any deductible;
(2) Workers' Compensation Insurance in compliance with the
Worker's Compensation Laws of the state in which the
Premises is located and including at least 100/500/100
Employers Liability Insurance.
(3) Excess/Umbrella Liability Insurance, with a "following
form" endorsement attached, with a minimum limit of
$3,000,000 each Occurrence and Aggregate, where
applicable; and
(4) Property insurance based on an "all risk" form acceptable
to Landlord, including but not limited to, coverage for:
(A) All office furniture, trade fixtures, office
equipment, merchandise, and all other items of
Tenant's property in, on, at, or about the Premises
and the Building, including property installed by,
for, or at the expense of Tenant;
(B) The Improvements; and
8
(C) All other improvements, betterments, alterations,
and additions to the Premises.
Tenant's Property Insurance must also fulfill the
following requirements:
(AA) It must include Landlord and Landlord's property
manager or mortgagee(s) (if any) as additional
insureds and be written on the equivalent of an ISO
"Special Form" Property Insurance Form or an
equivalent form acceptable to Landlord;
(BB) It must include perils of earthquake and flood as
covered causes of losses;
(CC) It must include an agreed amount endorsement (with
coinsurance waived) for not less than one-hundred
percent (100%) of the full replacement cost (new
without deduction for depreciation) of the covered
items and property; and
(DD) It must have a deductible no greater than $1,000 for
each loss.
It is the parties' intent that Tenant structure its property
insurance program so that no coinsurance penalty is imposed,
there are no valuation disputes with any insurer or with
Landlord, and valuation cost shall be based upon replacement
value. The property insurance coverage must include vandalism
and malicious mischief coverage.
(b) Tenant's policies must be written by an insurance company or
companies with a current A.M. Best's rating of A- IX or better and be admitted
to do business in the State of Texas.
9
Landlord and any mortgagee of Landlord must be named as additional insureds
without restriction under the liability, property and umbrella policies.
Tenant shall obtain a written obligation on the part of each insurance company
to notify Landlord at least thirty (30) days prior to cancellation,
non-renewal, or material reduction of the coverage.
(c) Tenant shall deliver copies of duly executed certificates of
insurance to Landlord, together with a copy of the endorsement(s) to such
policies of insurance evidencing that Landlord and Landlord's property manager
(together with any other parties required under this Section 8, if applicable)
have been included as additional insureds, in forms acceptable to Landlord,
prior to occupying any part of the Premises, and on an annual basis
thereafter. If Tenant fails to comply with these insurance requirements,
Landlord may obtain the required insurance and Tenant shall pay to Landlord on
demand as additional rent the premium cost thereof plus interest at the lower
of 18% per annum or the maximum legal contract rate from the date of payment
by Landlord until paid by Tenant.
(d) During the term hereof, Tenant shall carry, or cause to be
carried (with an insurer that satisfies the requirements set forth in Section
8(b) above) fire and extended coverage, commercial general liability, property
insurance and other insurance as Landlord deems reasonably necessary covering
all of the Premises for an amount not less than its full insurable value on a
replacement cost basis, for the benefit of Tenant and Landlord as their
interests may appear, by policies on such terms, in such form and for such
periods as Landlord shall require or approve from time to time, insuring with
all risk or special form coverage, and coverage insuring against loss of rents
and other income (for no less than twelve (12) full months) and when and to
the extent required by Landlord, against any other risks (the "Fire and
Extended Coverage Insurance"), and in addition to the Minimum Rent specified
in this Lease, Tenant shall pay the costs of the premiums for the Fire and
Extended Coverage Insurance carried hereunder in each calendar year or partial
calendar year during the term of this Lease. If Tenant fails to maintain the
Fire and Extended Coverage Insurance in force, then Landlord at its option may
effect such the Fire and Extended Coverage Insurance from year to year and pay
the premiums therefor, and any such sums advanced by Landlord shall bear
interest at the highest rate permitted by law, and shall be promptly
reimbursed to Landlord upon
10
receipt of written demand therefor. Tenant shall assign and deliver to
Landlord all policies of Fire and Extended Coverage Insurance which insure
against any loss or damage to the Premises or any part thereof, as collateral
and further security for the payment of the obligations under this Lease, with
loss payable to Landlord pursuant to a clause acceptable to Landlord. Landlord
is hereby authorized at its option to settle and adjust any claims arising out
of any insurance coverage so maintained by Tenant. Any expense incurred by
Landlord in the adjustment and collection of insurance proceeds shall be
reimbursed to Landlord first out of any insurance proceeds. If any insurance
proceeds under the Fire and Extended Coverage Insurance are received by
Landlord for loss or damage to the Improvements or the Personalty which total
less than $200,000.00, and provided Tenant is not then in default under this
Lease (in which case Landlord at its option may retain such proceeds and apply
them toward the payment of the obligations then due and owing under this Lease
in any order of priority Landlord may deem appropriate in its sole
discretion), then Landlord shall disburse said proceeds to Tenant in whole for
the repair or restoration of the damaged Improvements or Personalty. If any
insurance proceeds under the Fire and Extended Coverage Insurance are received
for loss or damage to the Improvements or the Personalty which total
$200,000.00 or more, and provided Tenant is not then in default under this
Lease (in which case Landlord at its option may retain such proceeds and apply
them toward the payment of the obligations then due and owing under this Lease
in any order of priority Landlord may deem appropriate in its sole
discretion), then Landlord shall disburse such proceeds to Tenant for the
repair or restoration of the damaged Improvements or Personalty in the same
manner as disbursements under a construction loan (i.e., with construction
draws); Landlord shall not be obligated to see to the proper application by
Tenant of any such disbursement. Not less than thirty (30) days prior to the
expiration date of each Fire and Extended Coverage Insurance policy required
under this Lease, Tenant shall deliver to Landlord a renewal policy or
policies marked "premium paid" or accompanied by other evidence of payment
satisfactory to Landlord. Each policy of insurance required hereunder shall be
non-cancelable without at least thirty (30) days' advance written notice to
Landlord.
9. Payment of Taxes by Landlord. If Tenant should fail to pay any
taxes, assessments
11
or governmental charges required to be paid by Tenant hereunder, in addition
to any other remedies provided herein, Landlord may, if it so elects (and
after reasonable notice to Tenant), pay such taxes, assessments and
governmental charges. Any sums so paid by Landlord shall bear interest at the
lower of 18% per annum or the maximum legal contract rate, shall be deemed to
be additional rental owing by Tenant to Landlord and shall be paid with the
next due installment of rent.
10. Repairs. Tenant shall take good care of the Building
(including but not limited to roof and structure), the parking areas, private
drives, sidewalks (if any and as applicable) and all other Improvements on the
Premises, throughout the term of this Lease, and shall keep them in an
attractive and good condition and free from waste or nuisance of any kind.
Tenant shall make repairs to the Building, parking areas, private drives,
sidewalks (if any and as applicable) and the Improvements at its sole cost and
expense; and Landlord shall not be called upon to make any improvements or
repairs of any kind during the term of this Lease. Tenant further agrees that it
shall care for the landscaping, if any, on the Property (including, to the
extent applicable, the mowing of grass, care of shrubs, watering and other
landscaping requirements) during the term of this Lease. The Premises shall not
be maintained as, nor shall Tenant permit the Premises to become, a public or
private nuisance; and Tenant shall not maintain any nuisance upon the Premises.
Tenant shall, at its sole cost and expense and at all times during the term of
this Lease, comply with and cause the Premises to comply with the terms of the
Declaration (including, without limitation, Article IX thereof). Upon the
expiration or other termination of this Lease, Tenant shall deliver up the
Premises with the Building, parking areas, private drives, sidewalks (if any and
as applicable) and improvements located thereon (including, without limitation,
the Improvements), in good repair and condition, loss by fire or other casualty
or act of God, and ordinary wear and tear excepted.
11. Alterations. Tenant shall have the right to make any
reasonable interior alterations, additions, or improvements to the Building as
may be necessary in connection with requirements of Tenant's business without
the prior written consent of Landlord and without the payment of any additional
rent, provided that such alterations, additions or improvements (x) shall not
reduce the value of the Premises, and (y) shall not affect the Building's
structure, or any of the mechanical, electrical, HVAC, plumbing systems or other
Building systems (collectively and as applicable, the
12
"Building Systems"). All other changes must be submitted to Landlord for
Landlord's prior written approval (not to be unreasonably withheld); and even
with regard to changes permitted by the immediately preceding sentence, if the
change either (i) costs more than $5,000.00 or (ii) is a structural change
and/or affects any of the Building Systems, then in either such event Tenant
will provide Landlord with written notice, accompanied by informational copies
of the plans and specifications of all such change(s), and such change(s)
shall be subject to Landlord's prior written approval (not to be unreasonably
withheld). Except as provided in Section 12 below, all alterations, additions
and improvements which may be made or installed upon the Premises shall remain
upon and be surrendered with the Premises and become the property of Landlord
upon the expiration or other termination of this Lease, unless (x) Landlord
requests the removal of alterations or additions to which it did not consent,
in which event Tenant shall remove the same and restore the Premises to their
original condition at Tenant's expense, or (y) Tenant timely and effectively
exercises its Purchase Option (as defined in and pursuant to Section 26
below).
12. Equipment, Fixtures and Signs on Premises. Tenant shall have
the right to maintain equipment, trade business fixtures and signs existing at
the Premises as of the Commencement Date of this Lease, and Tenant shall have
the additional right(s), at Tenant's sole cost and with the prior consent of
Landlord (such consent not to be unreasonably withheld), to erect, install,
maintain, and operate on the Premises additional equipment, trade and business
fixtures, and signs (exclusive of any signs on the roof), and all of such
equipment, trade and business fixtures, and signs (exclusive of any signs on the
roof) shall remain upon and be surrendered with the Premises and become the
property of Landlord upon the expiration or other termination of this Lease,
unless (x) Landlord requests the removal of such equipment, trade and business
fixtures, and signs to which it did not consent, in which event Tenant shall
remove the same and restore the Premises to their original condition at Tenant's
expense, or (y) Tenant timely and effectively exercises its Purchase Option (as
defined in and pursuant to Section 26 below). All such installation shall be
effected in compliance with applicable governmental laws, ordinances and
regulations and shall not materially injure or deface the building and other
improvements. Except as provided in this Section 12, Tenant shall have no right
to place any other signs on the Property or elsewhere on the Premises.
13
13. Damage by Fire or Other Casualty.
(a) If the Improvements on the Property should be damaged or destroyed
by fire, tornado, or other casualty, Tenant shall give immediate written notice
thereof to Landlord.
(b) If during the term of this Lease the building situated upon the
Premises should be substantially or totally destroyed by fire, tornado, or other
casualty, or if during such period it should be so damaged that rebuilding or
repairs cannot be completed within one hundred eighty (180) days after the date
of such damage, this Lease shall, at the option of Landlord (to be exercised by
written notice delivered to Tenant within twenty (20) days after the occurrence
of the casualty (the "Casualty Notice")), terminate and the rent shall be abated
during the unexpired portion of this Lease, effective with the date of such
damage. If Landlord elects to terminate this Lease in accordance with the
immediately preceding sentence, then Tenant shall have the right to exercise its
Purchase Option pursuant to the terms of Section 26 below by delivering its 30
days' written notice to Landlord within ten (10) days after receipt of the
Casualty Notice, in which case Tenant shall be entitled to the proceeds of the
Fire and Extended Coverage Insurance.
(c) If the building situated upon the Premises should be damaged by
fire, tornado, or other casualty but not under such circumstances as entitle
Landlord to terminate pursuant to Section 13(b) above, or if under such
circumstances but Landlord shall not have elected to terminate this Lease, this
Lease shall not terminate, but Tenant shall, at Tenant's sole cost and expense,
proceed with reasonable diligence to rebuild and repair such building to
substantially the condition in which it existed prior to such damage, and Tenant
may use the proceeds of the Fire and Extended Coverage Insurance for such
purpose (in accordance with the terms and provisions of Section 8(d) above). The
rent payable hereunder shall in no event xxxxx during the period in which the
Premises are untenantable.
(d) Tenant shall not, without Landlord's prior written consent, keep
anything within the Premises for any purpose which invalidates any insurance
policy carried on the Premises. All property kept, stored or maintained within
the Premises by Tenant shall be at Tenant's sole risk.
14
(e) Subject to Section 13(b) hereof, all insurance proceeds payable by
reason of the occurrence of such fire or other casualty shall be paid to
Landlord to be applied to the cost of repair or replacement of the Improvements
and the Personalty (in accordance with the terms and provisions of Section 8(d)
above).
14. Condemnation.
(a) If all of the Property -- or if less than all, but Landlord
reasonably determines the remaining portion cannot be utilized for the operation
of Tenant's business -- shall be acquired by the right of condemnation or
eminent domain for any public or quasi-public use or purpose or sold to a
condemning authority under threat of condemnation, then the term of this Lease
shall cease and terminate as of the date of title vesting in such proceeding (or
sale) and all rentals, including percentage rentals, shall be paid up to that
date.
(b) In the event of a partial taking or condemnation which takes less
than a substantial portion of the Property and Landlord reasonably determines
the remaining portion can be utilized for the operation of Tenant's business,
then Tenant, at Tenant's sole cost and expense, shall promptly restore the
remaining portion to a condition comparable to its condition at the time of such
condemnation less the portion lost in the taking; and in such event this Lease
shall continue in full force and effect and all rentals will continue without
abatement.
(c) In the event of any condemnation, taking or sale as aforesaid,
whether whole or partial, Landlord and Tenant shall each be entitled to receive
and retain such separate awards and portions of lump sum awards as may be
allocated to their respective interests in any condemnation proceedings, or as
may be otherwise agreed; except that if the remaining portion shall be restored
as herein provided, the Tenant shall first be entitled to recover its expenses
incurred in such restoration out of any such award, and the balance shall be
allocated as aforesaid. Termination of this Lease shall not affect the right of
the respective parties to such awards.
15. Liability and Indemnification.
(a) Landlord shall not be liable to Tenant or its directors,
shareholders, partners, trustees,
15
members, agents, contractors, subcontractors, employees, licensees, servants,
and invitees and all persons and entities claiming through any of these
persons or entities (collectively and as applicable, "Tenant Party(ies)"), or
any person whomsoever, for any injury to person or damage to property on or
about the Premises caused by the negligence or willful misconduct of Tenant or
any Tenant Party; and Tenant agrees to indemnify Landlord and hold it harmless
from any loss, claim, damage, cost or expense suffered or incurred by Landlord
by reason of any such damage or injury.
(b) Landlord and Landlord's agents and employees shall not be liable to
Tenant or any Tenant Party for any injury to person or damage to property caused
by the Premises (or any portion thereof) becoming out of repair or by defect in
or failure of equipment, pipes or wiring, or broken glass, or by the backing up
of drains, or by gas, water, steam, electricity or oil leaking, escaping or
flowing into the Premises, nor shall Landlord be liable to Tenant or any Tenant
Party for any loss or damage that may be occasioned by or through the acts or
omissions of any other persons whomsoever, excepting only duly authorized
employees and agents of Landlord.
(c) Tenant shall indemnify, defend, and hold Landlord and its
authorized representatives and their respective officers, directors,
shareholders, partners, trustees, members, agents, employees, property manager,
contractors and all persons and entities through any of these persons or
entities (collectively and as applicable, "Landlord Party(ies)") harmless from
all fines, suits, losses, costs, liabilities, claims, demands, actions, and
judgments of every kind and character (collectively, "Claims") INCLUDING THOSE
CLAIMS RESULTING SOLELY OR IN PART FROM THE NEGLIGENCE OF ANY LANDLORD PARTY
(BUT EXCEPTING THOSE CLAIMS RESULTING FROM THE GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT OF ANY LANDLORD PARTY) arising out of or relating (directly or
indirectly) to this Lease, the tenancy created under this Lease or the Premises,
including, without limitation:
(1) any breach or default in performance of any obligation on
Tenant's part to be performed under this Lease, whether
before or during the term of this Lease or after its
expiration or earlier termination;
(2) any act, omission, negligence, or misconduct of any Tenant
Party, or of any
16
other person entering upon the Premises under or with the
express or implied invitation or permission of Tenant;
(3) any alterations, activities, work, or things done,
permitted, allowed, or suffered by Tenant Parties in, at,
or about the Premises, including the violation by any
Tenant Party of any Applicable Laws (including, without
limitation, the Access Laws); and
(4) the occupancy or use by any Tenant Party of the Premises.
(d) Tenant shall indemnify, defend, and hold all Landlord Parties
harmless from any Claim for damage to the Improvements or Tenant's personal
property, fixtures, furniture, and equipment in the Premises (INCLUDING THOSE
CLAIMS RESULTING SOLELY OR IN PART FROM THE NEGLIGENCE OF ANY LANDLORD PARTY
(BUT EXCEPTING THOSE CLAIMS RESULTING FROM THE GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT OF ANY LANDLORD PARTY)), to the extent that the damage is covered by
ISO Special Form Property Insurance (including any deductible) that Tenant is
required to carry under this Lease (or would have been covered had Tenant
carried the insurance required under the provisions of this Lease).
(e) If any Landlord Party is made a party to any litigation commenced
against any Tenant Party or relating to this Lease or to the Premises, then
Tenant shall pay all costs and expenses, including attorneys' fees, court costs
and expenses, incurred by or imposed upon the Landlord Party by virtue of the
litigation. The amount of all costs and expenses, including attorneys' fees,
court costs and expenses is a demand obligation payable by Tenant to Landlord as
additional Rent bearing interest at the lower of 18% per annum or the maximum
legal contract rate from the date of payment by Landlord until paid by Tenant.
(f) If an employee (full-time, part-time, or temporary) of Tenant
suffers an injury at the Premises, Tenant shall cause the injured employee to
exhaust all rights under the applicable Workers' Compensation Laws before any
claim arising from the injury is asserted against any other party.
17
Tenant shall indemnify, defend, and hold Landlord Parties harmless from any
and all Claims suffered by Landlord Parties arising from any injury(ies) to
any of Tenant's employees or any other Tenant Parties.
(g) The provisions of this Section 15 survive the expiration or
earlier termination of this Lease. The indemnification provisions of this
Section 15 shall not be construed or interpreted as in any way restricting,
limiting, or modifying Tenant's insurance or other obligations under this Lease
and is independent of Tenant's insurance and other obligations under this Lease.
16. Assignment and Subletting.
(a) Tenant may not, without the prior written consent of Landlord,
which consent may be withheld by Landlord in its sole and absolute discretion,
(1) assign or transfer this Lease or any interest therein; (2) permit any
assignment of this Lease or any interest therein by operation of law; (3) sublet
the Premises or any part thereof; (4) grant any license, concession, or other
right of occupancy of any portion of the Premises; (5) mortgage, pledge, or
otherwise encumber its interest in this Lease; (6) permit the use of the
Premises by any parties other than Tenant and its employees; or (7) reorganize
as a corporation, limited liability company or any other form of legal entity.
Landlord's consent to any assignment, subletting, or reorganization is not a
waiver of Landlord's right to approve or disapprove any subsequent assignment,
subletting, or reorganization. Tenant and any guarantor of Tenant's obligations
under this Lease ("Guarantor", whether one or more) shall remain jointly and
severally liable for the payment of rent and performance of all other
obligations under this Lease after any assignment or subletting. If Tenant is a
partnership, Tenant, Guarantor, and the general partners of Tenant prior to its
reorganization shall remain jointly and severally liable for the payment of rent
and performance of all other obligations under this Lease after any
reorganization. Landlord and Tenant hereby agree that the granting of consent by
Landlord to any assignment or subletting, or reorganization shall be within the
sole and absolute discretion of Landlord and shall, at a minimum, be
preconditioned upon the fulfillment of the following requirements of Landlord,
as well as any other requirements of Landlord: (i) that no Event of Default has
occurred and is continuing at the time of the request for consent to the
sublease or assignment, (ii) that the use to be made of the Premises by the
assignee or sub-tenant is only as permitted in Section 5 hereof, (iii) that
18
the assignee or sub-tenant shall assume in writing the performance of all of
the terms, covenants and conditions of this Lease on the part of the Tenant to
be kept and performed, and (iv) that the Tenant shall deliver to the Landlord
within fifteen (15) days prior to the assignment or subletting the proposed
documents relating to such event, along with the proposed form of an
assumption agreement, all such documents to be subject to Landlord's comments
which shall be incorporated therein (with Tenant agreeing to deliver to
Landlord within 15 days after the assignment or subletting, an executed
duplicate thereof, together with a duly executed assumption agreement). Any
assignment or subletting shall be subject to and upon all of the terms and
provisions of this Lease.
(b) If the Premises or any part thereof are assigned or sublet to a
third party pursuant to Section 16(a) above, Landlord may at its option collect
directly from the assignee or sublessee all rents payable to Tenant under the
assignment or sublease and apply the rent against any sums due to Landlord under
this Lease. Tenant authorizes and directs any assignee or sublessee to make
payments of rent directly to Landlord upon receipt of notice from Landlord. No
direct collection of rent by Landlord from any assignee or sublessee is a
novation or a release of Tenant or Guarantor from the performance of their
obligations under this Lease or under any guaranty executed by Guarantor, and
Tenant and Guarantors shall continue to be liable under this Lease and any such
guaranty, with the same force and effect as if no such assignment or sublease
had been made.
(c) Tenant shall not mortgage, pledge or otherwise encumber its
interest in this Lease or in the Premises to any financial institution advancing
purchase-money financing for Tenant's operations on the Premises, without the
prior written consent of Landlord in Landlord's sole discretion.
(d) Tenant may, without the prior consent of Landlord, assign this
Lease to an Affiliate, so long as (i) Tenant provides Landlord a copy of the
assignment within ten (10) days after its execution, (ii) the transaction was
not entered into as a subterfuge to avoid the obligations and restrictions of
this Lease, (iii) the assignee or sublessee is engaged in a business customarily
acceptable for a tenant in projects similar to the Premises in the same
geographic area, (iv) the assignee's proposed use of the Leased Premises does
not violate the terms of this Lease, and (v) the
19
assignee's net worth, creditworthiness and financial standing is equal to or
better than Tenant's as of the date of such assignment or sublease. Landlord
has no obligation to recognize an Affiliate as the tenant under this Lease
unless Landlord timely receives a complete copy of the assignment and Tenant
pays Landlord its reasonable administrative and legal costs. Tenant and any
Guarantors of this Lease remain jointly and severally liable for the payment
of rent and performance of all other obligations under this Lease after any
assignment to an Affiliate. The term "Affiliate" means any entity that
acquires all or part of Tenant, or that is acquired in whole or in part by
Tenant, or which entity controls, directly or indirectly, Tenant. For purposes
of this subparagraph, "control" means the possession, directly or indirectly,
of the power to direct or cause the direction of the management and policies
of an entity, whether through the ownership of voting securities or by
contract or otherwise.
17. Default.
(a) The following events shall be deemed to be "Events of Default" by
Tenant under this Lease Agreement:
(1) Tenant shall fail to pay any installment or amount of
rent herein provided as and when the same shall become due and the
failure continues for a period of five (5) days;
(2) Tenant shall fail to comply with any term, provision or
covenant of this Lease, other than the payment of rent, and shall not
cure such failure within twenty (20) days after written notice
thereof is given by Landlord to Tenant; provided, however, if the
default is not reasonably curable within such 20-day period, Tenant
shall have a reasonable additional time period (not to exceed an
additional ninety (90) days) to cure such default so long as Tenant
commenced such cure within the initial 20-day period and continuously
and diligently prosecutes such cure to completion;
(3) Tenant shall become insolvent, or shall make a transfer
in fraud of creditors or shall make an assignment for the benefit of
creditors;
(4) Tenant shall file a petition under any section or
chapter of the Federal Bankruptcy Code, as amended, or under any
similar law or statute of the United States or any state thereof, or
Tenant shall be adjudged bankrupt or insolvent in proceedings filed
against Tenant thereunder; or
20
(5) A receiver or trustee shall be appointed for all or
substantially all of the assets of Tenant.
(6) Tenant, if a natural person, dies or becomes
incapacitated or, if Tenant is not a natural person, Tenant is
dissolved or ceases to exist (except as permitted pursuant to Section
16(d) above).
(7) Tenant's leasehold estate is taken on execution or
other process of law in any action against Tenant.
(8) Tenant does not conduct its business in any substantial
portion of the Premises for more than ten (10) consecutive business
days.
Notwithstanding the foregoing, and anything to the contrary contained in this
Lease, in the event that (A) Landlord provides Tenant written notice relating
to a failure by Tenant to comply with any term, provision or covenant of this
Lease, other than the payment of rent, pursuant to Section 17(a)(2) above (a
"17(a)(2) Notice"), (B) Tenant shall not cure such failure within twenty (20)
days after the 17(a)(2) Notice is given by Landlord to Tenant, and (C) Tenant
provides evidence acceptable to Landlord (in its sole, but reasonable,
discretion) within thirty (30) days following the 17(a)(2) Notice that the
failure(s) described in such 17(a)(2) Notice is not susceptible of cure at
all, then Landlord shall deliver a written notice to Tenant, at Landlord's
sole option, either (x) notifying Tenant that Landlord retracts the applicable
17(a)(2) Notice, in which case said 17(a)(2) Notice shall be null and void and
of no force or effect, or (y) notifying Tenant that Tenant shall be permitted
to either (1) pay all amounts due under this Lease and exercise its Purchase
Option pursuant to the terms of Section 26 of this Lease by delivering its 30
days' written notice to Landlord within ten (10) days after receipt of
Landlord' notice (time being of the essence), or (2) allow Landlord to
exercise its remedies under this Lease, at law or in equity due to the Event
of Default under Section 17(a)(2) of this Lease.
(b) Upon the occurrence of any such Event of Default, in addition to
any other remedy provided herein or at law or equity, Landlord shall have the
option to pursue any one or more of the following remedies without any notice or
demand whatsoever, and without terminating, invalidating or otherwise affecting
Landlord's Option pursuant to Section 27 below:
21
(1) Pursue a claim for monetary relief; or
(2) Enforce specific performance of Tenant's obligations; or
(3) Enter upon the Premises, without being liable for prosecution or
any claim for damages therefor, and do whatever Tenant is obligated to do
under the terms of this Lease; and Tenant agrees to reimburse Landlord on
demand for any expenses which Landlord may incur in thus effecting compliance
with Tenant's obligations under this Lease; or
(4) Without terminating this Lease, enter upon and take possession of
the Premises and expel or remove Tenant and other persons who may be occupying
the Premises or any part thereof, without being liable for prosecution of any
claim for damages therefor, and relet the Premises, as Tenant's agent and
receive the rent therefore; and Tenant agrees to pay Landlord on demand any
deficiency that may arise by reason of such reletting; or
(5) Terminate this Lease, in which event Tenant shall immediately
surrender the Premises to Landlord, and if Tenant fails so to do, Landlord
may, without prejudice to any other remedy which it may have for possession or
arrearages in rent enter upon and take possession of the Premises and expel or
remove Tenant and any other person who may be occupying the Premises, or any
part thereof, without being liable for prosecution or any claim for damages
thereof; and Tenant agrees to pay to Landlord on demand the amount of all loss
and damage which Landlord may suffer by reason of such termination, whether
through inability to relet the Premises on satisfactory terms or otherwise.
Pursuit of any of the foregoing remedies shall not preclude pursuit of any of
the other remedies herein provided or any other remedies provided by law or
equity, nor shall pursuit of any remedy herein provided constitute a forfeiture
or waiver of any rent due to Landlord hereunder or of any damage accruing to
Landlord by reason of the violation of any of the terms, provisions and
covenants herein contained. Forbearance by Landlord to enforce one or more of
the remedies herein provided upon the occurrence of an Event of Default shall
not be deemed or construed to constitute a waiver
22
of such default.
18. Inspection by Landlord. Landlord and Landlord's agents and
representatives shall have the right to enter upon and inspect the Premises at
any time during normal business hours upon prior reasonable notice to Tenant.
19. Covenant of Title and Quiet Enjoyment. If Tenant pays rent when
due and timely performs all other obligations of Tenant under this Lease, then
Tenant may peaceably and quietly enjoy the Premises during the term of this
Lease without any disturbance from Landlord or from any other person claiming
by, through, or under Landlord, but not otherwise, subject to the terms of
this Lease, Applicable Laws and matters affecting the Premises (including,
without limitation, the Declaration) as set forth on Exhibit "B" to the
Special Warranty Deed of even date hereof conveying the Premises from Tenant
to Landlord.
20. Holding Over by Tenant. Should Tenant or any successor in
interest of Tenant or any assignee, sublessee or licensee of Tenant hold over
the Premises or any part hereof after the expiration of this Lease unless
otherwise agreed in writing, such holdover shall constitute and be construed
as a tenancy at sufferance at a monthly rental equal to one hundred fifty
percent (150%) of the monthly Minimum Rent payable at the time of termination,
plus the payment of all other rent payable under this Lease. While Tenant or
its successor continues to hold the Premises after the termination of this
Lease, the tenancy is subject to all terms of this Lease; provided, all
expansion rights, first refusal rights, first notice rights, first offer
rights, and renewal rights (if any) automatically terminate. Landlord shall
have the right to terminate such tenancy at any time at will upon one (1) day
prior notice to Tenant. No payments of money by Tenant to Landlord after the
termination of this Lease reinstate, continue, or extend the term of this
Lease and no extension of this Lease after the termination or expiration
thereof is valid unless it is reduced to writing and signed by Landlord and
Tenant. Nothing in this Section 20 may be construed to give Tenant the right
to hold over beyond the scheduled expiration date of the term of this lease or
any earlier termination of this Lease or preclude Landlord from having the
right to dispossess or otherwise terminate Tenant's right of possession. Any
month-to-month tenancy or tenancy at sufferance is terminable upon one (1) day
23
prior notice to Tenant.
21. Notice and Payments. Each provision of this Lease or of any
applicable governmental laws, ordinances, regulations and other requirements
with reference to the sending, mailing or delivery of any notice or the making
of any payment by Tenant to Landlord shall be deemed to be complied with when
and if the following steps are taken:
(a) All rent and other payments required to be made by Tenant to
Landlord hereunder shall be payable to Landlord at the address hereinbelow set
forth or at such other address as Landlord may specify from time to time by
written notice delivered in accordance herewith;
(b) All payments (if any) required to be made by Landlord to Tenant
hereunder shall be payable to Tenant at the address hereinbelow set forth, or
at such address as Tenant may specify from time to time by written notice
delivered in accordance herewith;
(c) All notices, requests, approvals, and other communications required
or permitted to be delivered under this Lease must be in writing and are
effective:
(i) on the business day sent if (1) sent by telecopier prior to
5:00 p.m., Central Standard time, (2) the sending telecopier
generates a written confirmation of sending, and (3) a
confirming copy is sent on the same business day by one of the
other means specified below;
(ii) the next business day after delivery on a business day to a
nationally-recognized-overnight-courier service for prepaid
overnight delivery;
(iii) if orderly delivery of the mail is not then disrupted or
threatened, in which event some method of delivery other than
the mail must be used, 3 days after being deposited in the
United States mail, certified, return receipt requested,
postage prepaid; or
24
(iv) upon receipt if delivered personally or by any method other
than by telecopier (with written confirmations
nationally-recognized-overnight-courier service, or mail;
in each instance addressed to Landlord or Tenant, as the case may be, at the
address specified below, or to any other address either party may designate by
ten (10) days' prior notice to the other party.
If to Landlord: Briarwood Waters Ridge LP
c/o Briarwood Capital Corporation
0000 Xxxxxx Xxxxx Xxxxxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: X. Xxxxxx Xxxxxx
Fax No.: (000) 000-0000
With a copy to: Jenkens & Xxxxxxxxx, P.C.
0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000-0000
Attention: Xxxxxxxxxxx X. Xxxxx, Esq.
Fax No.: (000) 000-0000
If to Tenant: Ultrak Operating, L.P.
c/o Ultrak, Inc.
0000 Xxxxxx Xxxxx Xxxxx
Xxxxxxxxxx, Xxxxx 00000
Attention: Xxxxx Xxxxxx, CFO
Fax No.: (000) 000-0000
With a copy to: Xxxxxxxx & Bromberg, P.C.
0000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000-0000
Attention: Xxxx X. Xxxxxxxx, Esq.
Fax No.: (000) 000-0000
25
If and when included within the term "Landlord", as used in this instrument,
there is more than one person, firm or corporation, all shall jointly arrange
among themselves for their joint execution of such a notice specifying some
individual at some specific address for receipt of notice and payment to
Landlord; if and when included within the term "Tenant", as used in this
instrument, there is more than one person, firm or corporation, all shall
jointly arrange among themselves for their joint execution of such a notice
specifying some individual at some specific address for receipt of notices and
payments to Tenant. All parties included within the terms "Landlord" and
"Tenant", respectively, shall be bound by notices given in accordance with the
provisions of this Section 21 as if each had received such notice.
22. Net Lease. It is understood and agreed that this is a "net" lease
in the most absolute sense. It is the intention of the parties that Landlord
shall receive the rentals herein reserved free from (a) all taxes or charges
imposed upon or by reason of the Premises and (b) all expenses and charges
required to be paid to maintain the Premises and continue the ownership of
Landlord and Landlord's successors and assigns.
23. Force Majeure. When this Lease prescribes a period of time for
action to be taken by Landlord or Tenant, Landlord or Tenant is not liable or
responsible for, and there is excluded from the computation for the period of
time, any delays due to strikes, acts of God, shortages of labor or materials,
war, governmental laws, regulations, restrictions, or any other cause of any
kind that is beyond the control of Landlord or Tenant. Notwithstanding the
foregoing, the delays described in the preceding sentence shall not extend the
time period for either the Commencement Date or the obligation of Tenant to
pay rent under this Lease.
24. Waiver of Subrogation. Landlord and Tenant agree and covenant
that neither shall be liable to the other for loss arising out of damage to or
destruction of the Premises or contents thereof when such loss is caused by
any perils included within the State of Texas standard fire and
26
extended coverage insurance policy. Inasmuch as the above mutual waivers will
preclude the assignment of any aforesaid claim by way of subrogation (or
otherwise) to an insurance company (or any other applicable person or entity),
Landlord and Tenant severally agree immediately to give to each insurance
company which has issued to it policies of insurance, written notice of the
terms of said mutual waivers, and to have said insurance policies properly
endorsed, if necessary, to prevent the invalidation of said insurance
coverages by reason of said waivers.
25. Recording. A short-form memorandum of this Lease in the form
attached hereto as Exhibit "D" and made a part hereof for all purposes, shall
be executed and acknowledged by parties simultaneously with the execution and
delivery of this Lease, and shall be recorded in the Real Property Records of
Xxxxxx County, Texas, promptly following the Commencement Date at Tenant's
sole cost and expense.
26. Purchase Option. Landlord and Tenant hereby acknowledge and agree
that, provided that Tenant is not then in default under Section 17(a)(1) of
this Lease, and further provided that the Tenant under this Lease is Ultrak
Operating, L.P., a Texas limited partnership or an Affiliate, Tenant shall
have the option (but not the obligation) to purchase the Premises (including
the Improvements and the Personalty) (the "Purchase Option") on the terms and
conditions hereinafter set forth in this Section 26. Tenant shall exercise its
Purchase Option as herein granted by giving written notice (the "Option
Notice") thereof to Landlord on or before November 30, 2003, time being of the
essence. The date on which the Purchase Option, if exercised by Tenant, shall
be consummated by Landlord and Tenant shall be the last day of the
twenty-fourth (24th) full calendar month of the term of this Lease (the
"Closing Date"). In the event that Tenant shall exercise its Purchase Option
hereunder, the consideration to be paid by Tenant for the Premises (including
the Improvements) (referred to herein as the "Purchase Price") shall be SIX
MILLION NINE HUNDRED THOUSAND AND NO/100 DOLLARS ($6,900,000.00), and shall be
payable in cash from Tenant to Landlord at the consummation of the Purchase
Option on the Closing Date. If the Purchase Option is exercised, the Premises
(including the Improvements) shall be conveyed to Tenant by special warranty
deed (the "Deed") in form and content satisfactory to Landlord, and Landlord
will, upon conveyance, deliver to Tenant, at Tenant's option and sole cost and
expense, an owner's policy of title insurance insuring
27
Tenant's ownership of fee simple title to the Premises (including the
Improvements), together with any applicable easements or restrictions
appurtenant to or otherwise benefitting the Premises, subject to any
applicable permitted exceptions and/or encumbrance. All closing costs, escrow
charges, and attorneys' fees (of both Landlord and Tenant) shall be paid by
Tenant. Upon consummation of the Purchase Option on the Closing Date, this
Lease shall automatically terminate -- in which event Landlord and Tenant
shall execute and deliver one to the other any reasonably required document(s)
(in recordable form) as may be necessary to evidence such termination. In the
event that Tenant has not properly and validly exercised its Purchase Option
on or before November 30, 2003, time being of the essence, then Tenant shall
have no right (and shall be deemed to have waived its right) to exercise the
Purchase Option set forth in this Section 26. Tenant may not assign the
Purchase Option set forth in this Section 26 to any assignee of this Lease,
nor may any sublessee or assignee exercise the Purchase Option set forth in
this Section 26.
27. Tenant's Information. Tenant's Organizational Identification
Number issued by the Secretary of State of Texas is 85612-10. Tenant's Tax
Identification Number is 00-0000000.
28. Gender and Number. Words of any gender used in this Lease shall
be held and construed to include any other gender, and words in the singular
number shall be held to include the plural, and vice versa, unless the context
otherwise requires.
29. Binding Effect. The terms, provisions, covenants and conditions
contained in this Lease shall apply to, inure to the benefit of and be binding
upon the parties hereto and upon their respective heirs, legal
representatives, successors in interest and assigns, except as otherwise
herein expressly provided.
30. Entire Agreement; Amendments. This Lease is the entire agreement
between the parties. All negotiations, considerations, representations, and
understandings between Landlord and Tenant are incorporated in this Lease. No
act or omission of any employee or agent of Landlord may alter, change, or
modify any of the terms of this Lease. No amendment or modification of this
Lease is binding unless expressed in a written instrument executed by Landlord
and Tenant.
28
31. Captions. The captions used herein are for convenience only and
shall not be deemed to amplify, limit or otherwise construe the terms hereof
in any way.
32. Terms Held Invalid. If any provision of this Lease should be held
to be invalid or unenforceable, the validity and enforceability of the
remaining provisions of this Lease shall not be affected thereby.
33. Attorney's Fees. If on account of any breach or default in any of
Tenant's obligations hereunder, Landlord shall employ an attorney to enforce
or defend any of Landlord's rights or remedies hereunder, and Landlord is the
prevailing party in such matter, Tenant shall pay on demand any reasonable
attorney's fees incurred by Landlord in such connection.
34. Waiver of Repurchase Option. Notwithstanding anything to the
contrary contained in this Lease (including, without limitation, the terms of
Section 26 of this Lease), Tenant hereby acknowledges and agrees that it fully
and completely waives any and all rights that Tenant may ever have (i.e., now
and/or in the future) to exercise the option to repurchase the Premises (or
any portion thereof) pursuant to the terms of Article XII of the Declaration.
35. Estoppels. Tenant agrees that it will from time to time upon
request by Landlord execute and deliver to Landlord a written statement
addressed to Landlord (or to a party designated by Landlord), which statement
shall identify Tenant and this Lease, shall certify that this Lease is
unmodified and in full force and effect (or if there have been modifications,
that the same is in full force and effect as so modified), shall confirm that
Landlord is not in default as to any obligations of Landlord under this Lease
(or if Landlord is in default, specifying any default), and shall contain such
other information or confirmations as Landlord may require. Landlord is hereby
irrevocably appointed and authorized as the agent and attorney-in-fact of
Tenant to execute and deliver any such written statement on Tenant's behalf if
Tenant fails to do so within seven (7) days after the delivery of a written
request from Landlord to Tenant.
29
36. Mechanic's Liens. Tenant shall have no authority, express or
implied, to create or place any lien or encumbrance of any kind or nature
whatsoever upon, or in any manner to bind, the interest of Landlord in the
Premises or to charge the rentals payable hereunder for any claim in favor of
any person dealing with Tenant, including those who may furnish materials or
perform labor for any construction or repairs, and each such claim shall
affect and each lien shall attach to, if at all, only the leasehold interest
granted to Tenant by this instrument. Tenant covenants and agrees that it will
pay or cause to be paid all sums legally due and payable by it on account of
any labor performed or materials furnished in connection with any work
performed on the Premises on which any lien is or can be validly and legally
asserted against its leasehold interest in the Premises or the improvements
thereon and that it will save and hold Landlord harmless from any and all
loss, cost or expense based on or arising out of asserted claims or liens
against the leasehold estate or against the rights, title and interest of the
Landlord in the Premises or under the terms of this Lease.
37. No Joint Venture. Nothing herein contained shall be deemed or
construed by the parties hereto, nor by any third party, as creating the
relationship of principal and agent or partnership or of joint venture between
parties hereto, it being understood and agreed that neither the method of
computation of rent, nor any other provisions contained herein, nor any acts
of the parties hereto, shall be deemed to create any relationship between the
parties hereto other than the relationship of landlord and tenant.
38. Broker. Tenant warrants that it has had no dealing with any
broker or agent in connection with the negotiation or execution of this Lease.
Tenant shall indemnify, defend, and hold Landlord harmless against all costs,
expenses, attorneys' fees, or other liability for commissions or other
compensation or charges claimed by any broker or agent other than Brokers
claiming by, through, or under Tenant with respect to this Lease or any
renewal or extension.
39. Date of Lease. This Lease shall be dated as of date first above
written in this Lease.
40. No Representations. NO LANDLORD PARTY MADE ANY REPRESENTATIONS OR
PROMISES WITH RESPECT TO THE PREMISES EXCEPT AS
30
EXPRESSLY SET FORTH IN THIS LEASE. NO RIGHTS, EASEMENTS, OR LICENSES ARE
ACQUIRED BY TENANT BY IMPLICATION OR OTHERWISE EXCEPT AS EXPRESSLY SET FORTH
IN THIS LEASE. Tenant acknowledges that neither Landlord nor any other
Landlord Party has made, and Tenant waives, any representation or warranty
with respect to the Premises including, without limitation, any representation
or warranty with respect to the suitability or fitness of the Premises for the
conduct of Tenant's business.
41. Binding Effect. All terms of this Lease are binding upon the
respective heirs, personal representatives, successors, and, to the extent
assignment is permitted, assigns of Landlord and Tenant.
42. Counterparts. This Lease may be executed in two or more
counterparts, each of which is deemed an original and all of which together
constitute one and the same instrument.
43. Rental Tax. Tenant shall pay as additional Rent all licenses,
charges, and other fees of every kind and nature as and when they become due
arising out of or in connection with Tenant's use and occupancy of the
Premises, including but not limited to license fees, business license taxes,
and privilege, sales, excise, or other taxes (other than income) imposed upon
rent or upon services provided by Landlord or upon Landlord in an amount
measured by rent received by Landlord.
44. Landlord's Lien. To secure payment of all Rent and any damages or
losses Landlord suffers by reason of the breach by Tenant of this Lease,
Tenant grants to Landlord a security interest in, and an express contractual
lien on, all goods, wares, equipment, fixtures, furniture, improvements, and
other personal property of Tenant presently or hereafter situated in the
Premises (except parts of the property exchanged, replaced, or sold from time
to time in the ordinary course of Tenant's operations) and all proceeds
therefrom. The property may not be removed from the Premises without the
consent of Landlord until all arrearages in Rent are paid and any other
defaults cured by Tenant. This security interest is governed by Article 9 of
the Texas Business & Commerce Code (the "Code"). Upon request by Landlord,
Tenant shall execute and deliver to Landlord a financing statement in form
sufficient to perfect the security interest of Landlord in the property and
31
proceeds under the provisions of the Code. The security interest granted in
this Paragraph is in addition to Landlord's statutory and constitutional
liens. Notwithstanding the foregoing provisions of this Section 44, Landlord
agrees that it will subordinate its security interest(s) and landlord's
lien(s) to the security interest of Tenant's supplier(s) or third-party,
unaffiliated financial source(s) for as long as the rental account of Tenant
under this Lease is current (or is brought current), provided that any such
subordination shall be limited to a specified transaction and specified items
of the fixtures, equipment or inventory involved in the transaction, and
further provided that any such subordination is evidenced by a written
agreement in form and content reasonably satisfactory to Landlord.
45. Limitation of Actions. Any claim, demand, right, or defense of
Tenant arising out of this Lease is barred unless Tenant commences an action
or asserts an affirmative defense within 6 months after the date of the event
giving rise to Tenant's claim, demand, right, or defense. Tenant represents
and warrants to Landlord that Tenant has consulted with legal counsel
regarding the effect of this Paragraph.
46. Waiver of Jury Trial. LANDLORD AND TENANT HEREBY WAIVE ANY RIGHT
TO TRIAL BY JURY ON ANY CLAIM, COUNTERCLAIM, DEMAND, ACTION OR CAUSE OF ACTION
(A) ARISING OUT OF OR IN ANY WAY PERTAINING OR RELATING TO THIS LEASE OR ANY
OTHER DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION WITH THIS
LEASE OR (B) IN ANY WAY CONNECTED WITH OR PERTAINING OR RELATED TO OR
INCIDENTAL TO ANY DEALINGS OF THE PARTIES HERETO WITH RESPECT TO THIS LEASE OR
ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN
CONNECTION HEREWITH OR IN CONNECTION WITH THE TRANSACTIONS RELATED THERETO OR
CONTEMPLATED THEREBY OR THE EXERCISE OF EITHER PARTIES RIGHTS AND REMEDIES
THEREUNDER, IN ALL OF THE FOREGOING CASES WHETHER NOW EXISTING OR HEREAFTER
ARISING, AND WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE. LANDLORD AND
TENANT AGREE THAT EITHER OR BOTH OF THEM MAY FILE A COPY OF THIS PROVISION
WITH ANY COURT AS WRITTEN EVIDENCE OF
32
THE KNOWING, VOLUNTARY AND BARGAINED AGREEMENT BETWEEN THE PARTIES IRREVOCABLY
TO WAIVE TRIAL BY JURY, AND THAT ANY DISPUTE OR CONTROVERSY WHATSOEVER BETWEEN
THEM SHALL INSTEAD BE TRIED IN A COURT OF COMPETENT JURISDICTION BY A JUDGE
SITTING WITHOUT A JURY.
47. Execution and Approval of Lease. Employees and agents of Landlord
have no authority to make or agree to make a lease or any other agreement or
undertaking in connection herewith. The submission of this Lease for
examination and negotiation is not an offer to lease, agreement to reserve, or
option to lease the Premises. This Lease is effective and binding on Landlord
only upon the execution and delivery of this Lease by Landlord and Tenant.
48. Governing Law. The parties hereto acknowledge and agree that it
is their intention (respectively) that the laws of the State of Texas govern
the validity, construction of terms and interpretation of the rights and
duties of the parties with respect to this Lease.
49. Hazardous Materials.
(a) Tenant may not:
(1) cause or permit the escape, disposal, or release in or on the
Premises of any biologically active, chemically active, or
hazardous substances or materials (collectively, "hazardous
substances"); or
(2) bring, or permit any other Tenant Party to bring, any
hazardous substances into or onto the Premises.
The term "hazardous substances" includes, but is not limited to,
those described in the Comprehensive Environmental Response
Compensation and Liability Act of 1980, as amended, 42 U.S.C. Section
9601 et seq., the Resource Conservation and Recovery Act, as amended,
42 U.S.C. Section 6901 et seq., the Texas Water Code, the Texas Solid
Waste Disposal Act, and other applicable existing and future state or
local environmental laws and the regulations adopted under those
acts.
(b) If Landlord, any lender or any governmental agency requires
testing to ascertain whether or not a release of hazardous substances has
occurred in or on the Premises based on
33
probable cause that a release occurred and was caused by any Tenant Party,
then Tenant shall reimburse the reasonable costs of the testing to Landlord on
demand as additional rent.
(c) Tenant shall execute affidavits, representations, and the like
from time to time at Landlord's request concerning Tenant's best
knowledge and belief regarding the presence of hazardous substances in or
on the Premises.
(d) Tenant shall indemnify Landlord Parties in the manner elsewhere
provided in this Lease from any release of hazardous substances in or on
the Premises caused or permitted by any Tenant Party, including, but not
limited to, any costs incurred by Landlord in connection with the removal
or abatement of any such hazardous substances.
(e) These covenants survive the expiration or earlier termination of
this Lease.
50. Intention of Parties; Contingent Security Interest. Landlord and
Tenant each hereby acknowledge and agree that the parties hereto fully intend
that the transaction contemplated by this Lease be a lease transaction and
establish only the relationship of landlord and tenant by and between Landlord
and Tenant. Notwithstanding the foregoing, if, and only if, the transaction
contemplated by this Lease is deemed by any court or other legal authority to be
a loan or other category of financing transaction, and Landlord's fee simple
ownership of the Premises (or any portion thereof) is in any way disputed or
challenged, then the following provisions shall automatically be applicable:
(a) To secure the payment of the obligations and the full and
faithful performance of the covenants and agreements contained in this
Lease, as well as the full payment to Landlord of the Purchase Price
prescribed in the Purchase Option set forth in Section 26 of this Lease,
Tenant hereby grants and conveys the Premises to Xxxxxxxxxxx X. Xxxxx of
Dallas County, Texas ("Trustee"), to have and to hold the Premises
pursuant to the terms of this Section 50; moreover, Tenant hereby grants,
conveys and pledges to Landlord a security interest in all of the
Personalty.
(b) Tenant shall forever warrant and defend the title and quiet
possession of the Premises unto Trustee and Landlord, and the validity
and priority of the lien of this Section 50, against the lawful claims
and demands of all persons whomsoever, and this warranty of title shall
survive the foreclosure of the lien of this Section 50 and shall inure to
the benefit of and be enforceable by any person who may acquire the
Premises pursuant to foreclosure, trustee's sale or other exercise by
Landlord of the rights and remedies provided in this Section 50.
34
(c) All amounts due under this Lease, as well as full payment to
Landlord of the Purchase Price prescribed in the Purchase Option set
forth in Section 26 of this Lease, at the option of the Landlord, shall
become at once due and payable without demand or notice other than the
demand or notice provided for in this paragraph (c); and provided that
all or any portion of all such amounts remain unpaid, then the Trustee
when requested so to do so by Landlord, shall sell the Premises and the
Personalty at public auction to the highest bidder for cash, between the
hours of ten o'clock A.M. and four o'clock P.M. on the first Tuesday in
any month, at the door of the Courthouse in the County in which the
Premises, or any part thereof are situated, in accordance with the
requirement specified in Section 51.002 if the Texas Property Code, and
after advertising same in accordance with the requirements of Section
51.002 of the Texas Property Code.
(d) If and to the extent that subsections (a), (b) and (c) become
applicable to this transaction, Landlord may substitute any other Trustee
for the above-mentioned Xxxxxxxxxxx X. Xxxxx, with or without cause and
with or without notice having been provided to Tenant.
(e) Notwithstanding the foregoing, Landlord and Tenant hereby
acknowledge and agree that commencing at the end of the last day on which
Tenant is permitted under Section 26 above to properly and validly
exercise its Purchase Option, the expiration of such Purchase Option
shall be deemed to be a deed in lieu of foreclosure with respect to the
Premises as consideration for the right of Tenant to remain in possession
of the Premises for the balance of the term of this Lease; and in this
regard, Tenant's remaining in the Premises beyond the end of the last day
on which Tenant is permitted under Section 26 above to properly and
validly exercise its Purchase Option will conclusively be deemed to
constitute such deed in lieu of foreclosure to Landlord.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
35
This Lease is executed in multiple originals as of the date first above
set forth.
LANDLORD:
BRIARWOOD WATERS RIDGE LP,
a Texas limited partnership
By: Briarwood Capital Corporation,
a Texas corporation, its General Partner
By: _______________________________________
X. Xxxxxx Xxxxxx, President
TENANT:
ULTRAK OPERATING, L.P.,
a Texas limited partnership
By: Ultrak GP, Inc., a Texas corporation,
its General Partner
By:_________________________________________
Name:_______________________________________
Title:______________________________________
36
EXHIBIT "A"
Legal Description of Property to be attached pursuant to Section 1
37
EXHIBIT "B"
Site Plan
38
EXHIBIT "C-1"
GUARANTY
In order to induce BRIARWOOD WATERS RIDGE LP, a Texas limited
partnership ("Landlord"), to execute the foregoing Lease Agreement (the
"Lease") with ULTRAK OPERATING, L.P., a Texas limited partnership ("Tenant"),
for a certain Premises (herein so called and as defined in the Lease) in the
City of Lewisville, Xxxxxx County, Texas, the undersigned, ULTRAK, INC., a
Delaware corporation, ULTRAK GP, INC., a Delaware corporation, ULTRAK LP,
INC., a Delaware corporation, DIAMOND ELECTRONICS, INC., an Ohio corporation,
MONITOR DYNAMICS, INC., a California corporation, ABM DATA SYSTEMS, INC., a
Texas corporation, and SECURITY WARRANTY, INC., a Texas corporation (such
undersigned parties being referred to herein collectively as the
"undersigned") do hereby agree as follows:
The undersigned hereby jointly and severally guarantee, the payment
and performance of all liabilities, obligations and duties (including, but not
limited to, payment of rent) imposed upon Tenant under the terms of the Lease,
as if the undersigned had individually executed the Lease as Tenant hereunder.
In addition, the undersigned further agree that if (but only if) any action is
instituted by or on behalf of Tenant or any person or entity affiliated,
directly or indirectly, with Tenant (including, without limitation, the
undersigned) which challenges or seeks to challenge Landlord's ownership of
fee simple title to the Premises or any portion thereof, then each of the
undersigned, jointly and severally, hereby agree (a) that regardless of which
party prevails in any such action, the undersigned, jointly and severally,
shall indemnify and hold harmless Landlord and its successors and/or assigns
from and against any and all expenses, fines, suits, losses, costs,
liabilities, claims, demands, actions and judgments of every kind and
character (including, without limitation, reasonable attorneys' fees) arising
out of or relating, directly or indirectly, to such action; provided, however,
that the counsel selected by Landlord in connection with any such
proceeding(s) shall be reasonably acceptable to Landlord and the undersigned,
and (b) that if as a result of any such action Landlord is divested of, or
ordered to convey, all or any portion of the fee simple title to the Premises,
then the undersigned, jointly and severally, shall either (i) pay to Landlord
the Purchase Price prescribed in the Purchase Option set forth in Section 26
of the Lease with respect to the value of the portion of the Premises that
Landlord is divested of or ordered to convey or (ii) pay the full amount of
the Purchase Price prescribed in the Purchase Option set forth in Section 26
of the Lease and receive from Landlord a transfer of all title of Landlord to
the Premises. Notwithstanding the foregoing, Landlord (by its acceptance
hereof) hereby agrees that if Landlord is divested of, or ordered to convey,
all or any portion of the fee simple title to the Premises as stated in the
immediately preceding sentence, then Landlord shall be obligated to use
commercially reasonable efforts to obtain recovery under the terms and
conditions of the Owner's Policy of Title Insurance in the amount of
$6,600,000.00 (the "Title Policy") obtained by Landlord when it acquired the
Premises prior to enforcement against any of the undersigned of any liability,
obligation or duty guaranteed pursuant to the immediately preceding sentence;
provided, however, that to the extent Landlord is not successful in its
commercially reasonable efforts to recover under the terms and conditions of
the Title Policy (i.e., to the extent Landlord recovers amounts under the
Title Policy, such amounts shall serve to offset the liability of the
undersigned to Landlord pursuant to the immediately preceding sentence), upon
the expiration of one (1) year following the date Landlord made a written
claim under the Title Policy pursuant to the terms and conditions thereof,
Landlord
39
shall then be permitted to enforce against the undersigned any liability,
obligation or duty guaranteed pursuant to the immediately preceding sentence.
As used in the immediately preceding sentence, "commercially reasonable
efforts" shall be deemed to mean Landlord having made a written claim under
the Title Policy pursuant to the terms and conditions thereof, and if
Landlord's claim under the Title Policy is denied by the insurer thereunder,
filing a lawsuit against said insurer (with counsel reasonably acceptable to
Landlord and the undersigned); provided, however, that following the filing of
such law suit, the undersigned shall be jointly and severally responsible (and
shall promptly reimburse Landlord) for any and all expenses, fines, suits,
losses, costs, liabilities, claims, demands, actions and judgments of every
kind and character (including, without limitation, reasonable attorneys' fees)
arising out of or relating, directly or indirectly, to such action against the
insurer under the Title Policy.
The undersigned hereby waives notice of acceptance of this Guaranty
and all other notices in connection herewith or in connection with the
liabilities, obligations and duties guaranteed hereby, including notices of
default by Tenant under the Lease, and waives diligence, presentment and suit
on the part of Landlord in the enforcement of any liability, obligation or
duty guaranteed hereby.
The undersigned further agrees that Landlord shall not be first
required to enforce against Tenant or any other person any liability,
obligation or duty guaranteed hereby before seeking enforcement thereof
against the undersigned. Suit may be brought and maintained against the
undersigned by Landlord to enforce any liability, obligation or duty
guaranteed hereby without joinder of Tenant or any other person. The liability
of the undersigned shall not be affected by any indulgence, compromise,
settlement or variation of terms which may be extended to Tenant by Landlord
or agreed upon by Landlord and Tenant, and shall not be impaired, modified,
changed, released or limited in any manner whatsoever by any impairment,
modification, change, release, or limitation of the liability of Tenant or its
estate in bankruptcy, or if any remedy for the enforcement thereof, resulting
from the operation of any present or future provision of the federal
Bankruptcy act, or any similar law or statute of the United States or any
state thereof. Landlord and Tenant, without notice to or consent by the
undersigned, may at any time or times enter into such extensions, amendments,
assignments, subleases, or other covenants with respect to the Lease as the
may deem appropriate; and the undersigned shall not be released thereby, but
shall continue to be fully liable for the payment and performance of all
liabilities, obligations and duties of Tenant under the Lease as so extended,
amended, assigned or otherwise modified.
The undersigned acknowledges and agrees that the laws of the State of
Texas govern the validity, construction of terms and interpretation of the
rights and duties of the parties with respect to this Guaranty.
It is understood that other agreements similar to this Guaranty may,
at Landlord's sole option and discretion, be executed by other persons with
respect to the Lease. This Guaranty shall be cumulative of any such agreements
and the liabilities and obligations of the undersigned hereunder shall in no
event be affected or diminished by reason of such other agreements. Moreover,
in the event Landlord obtains another signature of more than one guarantor on
this Guaranty or by obtaining additional guaranty agreements, or both, the
undersigned agrees that Landlord, in Landlord's sole discretion, may (i) bring
suit against all guarantors of the Lease jointly and severally or against any
one or more of them, (ii) compound or settle with any one or more of the
guarantors for such consideration as Landlord may deem proper, and (iii)
release one or more of the guarantors
40
from liability. The undersigned further agrees that no such action shall
impair the rights of Landlord to enforce the Lease against any remaining
guarantor or guarantors, including the undersigned.
If a party executing this Guaranty is a corporation, then the
undersigned officer personally represents and warrants that the Board of
Directors of such corporation, in a duly held meeting, has determined that
this Guaranty may reasonably be expected to benefit the corporation.
The undersigned agrees that if Landlord shall employ an attorney to
present, enforce or defend all of Landlord's rights or remedies hereunder, the
undersigned shall pay any reasonable attorney's fees incurred by Landlord in
such connection.
The undersigned represents and warrants to Landlord that Tenant is
affiliated with the undersigned and that the undersigned has determined that
this Guaranty reasonably may be expected to benefit the undersigned.
This Guaranty shall be binding upon the undersigned and its
successors and assigns and shall inure to the benefit of Landlord and
Landlord's successors and assigns.
EXECUTED in ______________ County, Texas, this ____ day of December,
2001, to be effective as of the same date as the effective date of execution of
the Lease.
ULTRAK, INC., a Delaware corporation
Attest:
___________________________ By:___________________________________
Name:_________________________________
Title:________________________________
Address: 0000 Xxxxxx Xxxxx Xxxxx
Xxxxxxxxxx, Xxxxx 00000
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
ULTRAK GP, INC., a Delaware corporation
Attest:
___________________________ By:___________________________________
Name:_________________________________
Title:________________________________
Address: c/o Ultrak, Inc.
0000 Xxxxxx Xxxxx Xxxxx
Xxxxxxxxxx, Xxxxx 00000
41
ULTRAK LP, INC., a Delaware corporation
Attest:
___________________________ By:__________________________________
Name:________________________________
Title:_______________________________
Address: c/o Ultrak, Inc.
0000 Xxxxxx Xxxxx Xxxxx
Xxxxxxxxxx, Xxxxx 00000
DIAMOND ELECTRONICS, INC.,
an Ohio corporation
Attest:
___________________________ By:_________________________________
Name:_______________________________
Title:______________________________
Address: c/o Ultrak, Inc.
0000 Xxxxxx Xxxxx Xxxxx
Xxxxxxxxxx, Xxxxx 00000
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
42
MONITOR DYNAMICS, INC.,
a California corporation
Attest:
___________________________ By:___________________________________
Name:_________________________________
Title:________________________________
Address: c/o Ultrak, Inc.
0000 Xxxxxx Xxxxx Xxxxx
Xxxxxxxxxx, Xxxxx 00000
ABM DATA SYSTEMS, INC.,
a Texas corporation
Attest:
___________________________ By:__________________________________
Name:________________________________
Title:_______________________________
Address: c/o Ultrak, Inc.
0000 Xxxxxx Xxxxx Xxxxx
Xxxxxxxxxx, Xxxxx 00000
SECURITY WARRANTY, INC.,
a Texas corporation
Attest:
___________________________ By:__________________________________
Name:________________________________
Title:_______________________________
Address: c/o Ultrak, Inc.
0000 Xxxxxx Xxxxx Xxxxx
Xxxxxxxxxx, Xxxxx 00000
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
43
THE STATE OF TEXAS ss.
ss.
COUNTY OF ______________ ss.
This instrument was acknowledged before me on the ______ day of
December, 2001, by _____________________________, as ___________________ of
ULTRAK, INC., a Delaware corporation, for and on behalf of said corporation.
___________________________________________
Notary Public in and for the State of Texas
My Commission Expires:
THE STATE OF TEXAS ss.
ss.
COUNTY OF ______________ ss.
This instrument was acknowledged before me on the ______ day of
December, 2001, by _____________________________, as ___________________ of
ULTRAK GP, INC., a Delaware corporation, for and on behalf of said
corporation.
___________________________________________
Notary Public in and for the State of Texas
My Commission Expires:
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
44
THE STATE OF TEXAS ss.
ss.
COUNTY OF ______________ ss.
This instrument was acknowledged before me on the ______ day of
December, 2001, by _____________________________, as ___________________ of
ULTRAK LP, INC., a Delaware corporation, for and on behalf of said corporation.
___________________________________________
Notary Public in and for the State of Texas
My Commission Expires:
THE STATE OF TEXAS ss.
ss.
COUNTY OF ______________ ss.
This instrument was acknowledged before me on the ______ day of
December, 2001, by _____________________________, as ___________________ of
DIAMOND ELECTRONICS, INC., an Ohio corporation, for and on behalf of said
corporation.
___________________________________________
Notary Public in and for the State of Texas
My Commission Expires:
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
45
THE STATE OF TEXAS ss.
ss.
COUNTY OF ______________ ss.
This instrument was acknowledged before me on the ______ day of
December, 2001, by _____________________________, as ___________________ of
MONITOR DYNAMICS, INC., a California corporation, for and on behalf of said
corporation.
___________________________________________
Notary Public in and for the State of Texas
My Commission Expires:
THE STATE OF TEXAS ss.
ss.
COUNTY OF ______________ ss.
This instrument was acknowledged before me on the ______ day of
December, 2001, by _____________________________, as ___________________ of
ABM DATA SYSTEMS, INC., a Texas corporation, for and on behalf of said
corporation.
___________________________________________
Notary Public in and for the State of Texas
My Commission Expires:
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
46
THE STATE OF TEXAS ss.
ss.
COUNTY OF ______________ ss.
This instrument was acknowledged before me on the ______ day of
December, 2001, by _____________________________, as ___________________ of
SECURITY WARRANTY, INC., a Texas corporation, for and on behalf of said
corporation.
___________________________________________
Notary Public in and for the State of Texas
My Commission Expires:
47
EXHIBIT "C-2"
GUARANTY
In order to induce BRIARWOOD WATERS RIDGE LP, a Texas limited partnership
("Landlord"), to execute the foregoing Lease Agreement (the "Lease") with ULTRAK
OPERATING, L.P., a Texas limited partnership ("Tenant"), for a certain Premises
(herein so called and as defined in the Lease) in the City of Lewisville, Xxxxxx
County, Texas, the undersigned, XXXXXX X. XXXXXX, an individual resident of
Dallas County, Texas (being hereinafter referred to as the "undersigned") hereby
agrees as follows:
The undersigned hereby guarantees the payment of up to $720,000 of
Minimum Rent (as defined in the Lease) payable by Tenant under the terms of the
Lease, to the extent Landlord does not collect any such Minimum Rent from Tenant
or Ultrak, Inc., a Delaware corporation, after exercising all available remedies
against such parties. Notwithstanding anything to the contrary herein, the
maximum liability of the undersigned under this Guaranty with respect to Minimum
Rent (as defined in the Lease) payable by Tenant under the terms of the Lease
shall be the sum of (i) $720,000 of the Minimum Rent and (ii) any reasonable
attorneys' fees incurred by Landlord in enforcing this Guaranty.
In addition, the undersigned hereby agrees that if (but only if) any
action is instituted by or on behalf of Tenant or any person or entity
affiliated, directly or indirectly, with Tenant (including, without limitation,
the undersigned) which challenges or seeks to challenge Landlord's ownership of
fee simple title to the Premises or any portion thereof, then the undersigned
hereby agrees (a) that regardless of which party prevails in any such action,
the undersigned shall indemnify and hold harmless Landlord and its successors
and/or assigns from and against any and all expenses, fines, suits, losses,
costs, liabilities, claims, demands, actions and judgments of every kind and
character (including, without limitation, reasonable attorneys' fees) arising
out of or relating, directly or indirectly, to such action; provided, however,
that the counsel selected by Landlord in connection with any such proceeding(s)
shall be reasonably acceptable to Landlord and the undersigned, and (b) that if
as a result of any such action Landlord is divested of, or ordered to convey,
all or any portion of the fee simple title to the Premises, then the undersigned
shall either (i) pay to Landlord the Purchase Price prescribed in the Purchase
Option set forth in Section 26 of the Lease with respect to the value of the
portion of the Premises that Landlord is divested of or ordered to convey or
(ii) pay the full amount of the Purchase Price prescribed in the Purchase Option
set forth in Section 26 of the Lease and receive from Landlord a transfer of all
title of Landlord to the Premises. Notwithstanding the foregoing, Landlord (by
its acceptance hereof) hereby agrees that (A) prior to or concurrently with
enforcement against the undersigned of any liability, obligation or duty
guaranteed pursuant to the immediately preceding sentence, Landlord shall seek
to recover such amounts from Tenant and Ultrak, Inc., and to the extent Landlord
recovers amounts from Tenant and/or Ultrak, Inc. in any such prior or concurrent
action, such amounts shall serve to offset the liability of the undersigned to
Landlord pursuant to the immediately preceding sentence, and (B) if Landlord is
divested of, or ordered to convey, all or any portion of the fee simple title to
the Premises as stated in the immediately preceding sentence, then Landlord
shall be obligated to use commercially reasonable efforts to obtain recovery
under the terms and conditions of the Owner's Policy of Title Insurance in the
amount of $6,600,000.00 (the "Title Policy") obtained by Landlord when it
acquired the Premises prior to enforcement against the undersigned of any
liability, obligation or duty guaranteed pursuant to the immediately preceding
sentence; provided, however,
48
that to the extent Landlord is not successful in its commercially reasonable
efforts to recover under the terms and conditions of the Title Policy (i.e., to
the extent Landlord recovers amounts under the Title Policy, such amounts shall
serve to offset the liability of the undersigned to Landlord pursuant to the
immediately preceding sentence), upon the expiration of one (1) year following
the date Landlord made a written claim under the Title Policy pursuant to the
terms and conditions thereof, Landlord shall then be permitted to enforce
against the undersigned any liability, obligation or duty guaranteed pursuant to
the immediately preceding sentence. As used in the immediately preceding
sentence, "commercially reasonable efforts" shall be deemed to mean Landlord
having made a written claim under the Title Policy pursuant to the terms and
conditions thereof, and if Landlord's claim under the Title Policy is denied by
the insurer thereunder, filing a lawsuit against said insurer (with counsel
selected by the undersigned, approved by Landlord in its reasonable discretion).
Following the filing of such lawsuit and any recovery by Landlord of amounts
from the undersigned under this Guaranty, upon the written request of the
undersigned Landlord shall either (1) to the extent permitted by applicable law,
assign the lawsuit to the undersigned, so that the undersigned my pursue such
lawsuit at its sole cost and expense, or (2) if such assignment is not permitted
by applicable law, and if the undersigned desires that Landlord continue
diligently pursuing the lawsuit against the insurer under the Title Policy for
the benefit of the undersigned, Landlord shall do so and the undersigned shall
be solely responsible (and shall promptly reimburse Landlord) for any and all
expenses, fines, suits, losses, costs, liabilities, claims, demands, actions and
judgments of every kind and character (including, without limitation, reasonable
attorneys' fees) arising out of or relating, directly or indirectly, to such
action against the insurer under the Title Policy.
The undersigned hereby waives notice of acceptance of this Guaranty and
all other notices in connection herewith or in connection with the liabilities,
obligations and duties guaranteed hereby, including notices of default by Tenant
under the Lease, and waives diligence, presentment and suit on the part of
Landlord in the enforcement of any liability, obligation or duty guaranteed
hereby.
The undersigned further agrees that Landlord shall be first (or
concurrently) required to enforce against Tenant or any other person any
liability, obligation or duty guaranteed hereby before and/or concurrently with
seeking enforcement thereof against the undersigned. Suit may be brought and
maintained against the undersigned by Landlord to enforce any liability,
obligation or duty guaranteed hereby without joinder of Tenant or any other
person. The liability of the undersigned shall not be impaired, modified,
changed, released or limited in any manner whatsoever by any impairment,
modification, change, release, or limitation of the liability of Tenant or its
estate in bankruptcy, or if any remedy for the enforcement thereof, resulting
from the operation of any present or future provision of the federal Bankruptcy
act, or any similar law or statute of the United States or any state thereof.
Landlord and Tenant, without notice to or consent by the undersigned, may at any
time or times enter into such extensions, amendments, assignments, subleases, or
other covenants with respect to the Lease as the may deem appropriate; and the
undersigned shall not be released thereby, but shall continue to be fully liable
hereunder with respect to the Lease as so extended, amended, assigned or
otherwise modified.
The undersigned acknowledges and agrees that the laws of the State of
Texas govern the validity, construction of terms and interpretation of the
rights and duties of the parties with respect to this Guaranty.
It is understood that other agreements similar to this Guaranty may, at
Landlord's sole option and discretion, be executed by other persons with respect
to the Lease. This Guaranty shall be
49
cumulative of any such agreements and the liabilities and obligations of the
undersigned hereunder shall in no event be affected or diminished by reason of
such other agreements. Moreover, in the event Landlord obtains another signature
of more than one guarantor on this Guaranty or by obtaining additional guaranty
agreements, or both, the undersigned agrees that Landlord, in Landlord's sole
discretion, may (i) bring suit against all guarantors of the Lease jointly and
severally or against any one or more of them, (ii) compound or settle with any
one or more of the guarantors for such consideration as Landlord may deem
proper, and (iii) release one or more of the guarantors from liability. The
undersigned further agrees that no such action shall impair the rights of
Landlord to enforce the Lease against any remaining guarantor or guarantors,
including the undersigned.
If a party executing this Guaranty is a corporation, then the
undersigned officer personally represents and warrants that the Board of
Directors of such corporation, in a duly held meeting, has determined that this
Guaranty may reasonably be expected to benefit the corporation.
The undersigned agrees that if Landlord shall employ an attorney to
present, enforce or defend all of Landlord's rights or remedies hereunder, the
undersigned shall pay any reasonable attorney's fees incurred by Landlord in
such connection.
The undersigned represents and warrants to Landlord that Tenant is
affiliated with the undersigned and that the undersigned has determined that
this Guaranty reasonably may be expected to benefit the undersigned.
This Guaranty shall be binding upon the undersigned and its successors
and assigns and shall inure to the benefit of Landlord and Landlord's successors
and assigns.
EXECUTED in ______________ County, Texas, this ____ day of December,
2001, to be effective as of the same date as the effective date of execution of
the Lease.
______________________________
Xxxxxx X. Xxxxxx, Individually
Address:______________________
______________________
CONSENT OF SPOUSE
The undersigned is the spouse of Xxxxxx X. Xxxxxx, a guarantor under
the terms of the above-executed Guaranty. By executing this Consent, the
undersigned hereby acknowledges the terms and obligations of the above Guaranty
and that the Guaranty is binding upon the marital community assets of Xxxxxx X.
Xxxxxx and the undersigned spouse.
____________________________________
Name: ______________________________
00
XXX XXXXX XX XXXXX ss.
ss.
COUNTY OF ______________ ss.
This instrument was acknowledged before me on the ______ day of December,
2001, by XXXXXX X. XXXXXX.
___________________________________________
Notary Public in and for the State of Texas
My Commission Expires:
THE STATE OF TEXAS ss.
ss.
COUNTY OF ______________ ss.
This instrument was acknowledged before me on the ______ day of December,
2001, by _______________.
___________________________________________
Notary Public in and for the State of Texas
My Commission Expires:
51
EXHIBIT "D"
MEMORANDUM OF LEASE AND PURCHASE OPTION
THIS MEMORANDUM OF LEASE (this "Memorandum") is entered into by and
between BRIARWOOD WATERS RIDGE LP, a Texas limited partnership ("Landlord"), as
landlord, and ULTRAK OPERATING, L.P., a Texas limited partnership ("Tenant"), as
tenant.
WITNESSETH:
1. Premises. Landlord and Tenant have entered into a Lease Agreement
(the "Lease") dated on or about the date hereof, for certain inproved real
property in Lewisville, Xxxxxx County, Texas, which land is more particularly
described on Exhibit "A" attached hereto and made a part hereof for all
purposes.
2. Term. The Lease has an initial term of thirty (30) full calendar
months expiring on June 30, 2004.
3. Purchase Option. The Lease also contains certain rights in favor of
Tenant to purchase the Premises (as defined in the Lease).
4. Incorporation of Lease. This Memorandum is for information purposes
only and nothing contained herein shall be deemed to in any way modify or
otherwise affect any of the terms and conditions of the Lease, the terms of
which are incorporated herein by reference. This instrument is merely a
memorandum of the Lease and is subject to all of the terms, provisions and
conditions of the Lease. In the event of any inconsistency between the terms of
the Lease and this instrument, the terms of the Lease shall prevail.
5. Intention of Parties; Contingent Security Interest. Landlord and
Tenant each hereby acknowledge and agree that the parties hereto fully intend
that the transaction contemplated by the Lease be a lease transaction and
establish only the relationship of landlord and tenant by and between Landlord
and Tenant. Notwithstanding the foregoing, if, and only if, the transaction
contemplated by the Lease is deemed by any court or other legal authority to be
a loan or other category of financing transaction, and Landlord's fee simple
ownership of the Premises (or any portion thereof) is in any way disputed or
challenged, then the following provisions shall automatically be applicable:
(a) to secure the payment of the obligations and the full and faithful
performance of the covenants and agreements contained in the Lease, as well as
the full payment to Landlord of the
52
Purchase Price prescribed in the Purchase Option set forth in Section 26 of the
Lease, Tenant hereby grants and conveys the Premises to Xxxxxxxxxxx X. Xxxxx of
Dallas County, Texas ("Trustee"), to have and to hold the Premises pursuant to
the terms of this Section 4; moreover, Tenant hereby grants, conveys and pledges
to Landlord a security interest in all of the Personalty;
(b) Tenant shall forever warrant and defend the title and quiet
possession of the Premises unto Trustee and Landlord, and the validity and
priority of the lien of this Section 4, against the lawful claims and demands of
all persons whomsoever, and this warranty of title shall survive the foreclosure
of the lien of this Section 4 and shall inure to the benefit of and be
enforceable by any person who may acquire the Premises pursuant to foreclosure,
trustee's sale or other exercise by Landlord of the rights and remedies provided
in this Section 4;
(c) All amounts due under the Lease, as well as full payment to
Landlord of the Purchase Price prescribed in the Purchase Option set forth in
Section 26 of the Lease, at the option of the Landlord, shall become at once due
and payable without demand or notice other than the demand or notice provided
for in this paragraph (c); and provided that all or any portion of all such
amounts remain unpaid, and the Trustee when requested so to do so by Landlord,
shall sell the Premises and the Personalty at public auction to the highest
bidder for cash, between the hours of ten o'clock A.M. and four o'clock P.M. on
the first Tuesday in any month, at the door of the Courthouse in the County in
which the Premises, or any part thereof are situated, in accordance with the
requirement specified in Section 51.002 if the Texas Property Code, and after
advertising same in accordance with the requirements of Section 51.002 of the
Texas Property Code.
(d) If and to the extent that subsections (a), (b) and (c) become
applicable to this transaction, Landlord may substitute any other Trustee for
the above-mentioned Xxxxxxxxxxx X. Xxxxx, with or without cause and with or
without notice having been provided to Tenant.
(e) Notwithstanding the foregoing, Landlord and Tenant hereby
acknowledge and agree that commencing at the end of the last day on which Tenant
is permitted under Section 26 of the Lease to properly and validly exercise its
Purchase Option, the expiration of such Purchase Option shall be deemed to be a
deed in lieu of foreclosure with respect to the Premises as consideration for
the right of Tenant to remain in possession of the Premises for the balance of
the term of this Lease; and in this regard, Tenant's remaining in the Premises
beyond the end of the last day on which Tenant is permitted under Section 26 of
the Lease to properly and validly exercise its Purchase Option will conclusively
be deemed to constitute such deed in lieu of foreclosure to Landlord.
53
6. Tenant's Information. Tenant's Organizational Identification Number
issued by the Secretary of State of Texas is 85612-10. Tenant's Tax
Identification Number is 00-0000000.
7. Waiver of Repurchase Option. Notwithstanding anything to the
contrary contained in the Lease (including, without limitation, the terms of
Section 26 of the Lease), Tenant hereby acknowledges and agrees that it fully
and completely waives any and all rights that Tenant may ever have (i.e., now
and/or in the future) to exercise the option to repurchase the Premises (or any
portion thereof) pursuant to the terms of Article XII of that certain Master
Declaration of Covenants, Restrictions and Development Standards Applicable to
Waters' Ridge dated June 1, 1984, recorded in Volume 1423, Page 000, Xxxx
Xxxxxxx xx Xxxxxx Xxxxxx, Xxxxx, as amended.
8. Binding Effect. The rights and obligations set forth herein shall be
binding upon and insure to the benefit of the parties hereto and their
respective heirs, personal representatives, successors and assigns.
Notwithstanding any contrary provision hereof, upon execution and recordation of
an instrument in the Real Property Records of Xxxxxx County, Texas by the then
owner of fee title to the land described on Exhibit "A" hereto which references
this instrument and provides that the Lease has expired or been terminated or
that certain rights of Tenant thereunder are no longer in force and effect, all
persons shall be entitled to rely thereon without any duty of investigation or
inquiry.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
54
The parties have executed this Memorandum of Lease to be effective as of the
Effective Date.
LANDLORD:
BRIARWOOD WATERS RIDGE LP,
a Texas limited partnership
By: Briarwood Capital Corporation,
a Texas corporation, its General Partner
By:_________________________________________
X. Xxxxxx Xxxxxx, President
TENANT:
ULTRAK OPERATING, L.P.,
a Texas limited partnership
By: Ultrak GP, Inc., a Texas corporation,
its General Partner
By:_________________________________________
Name:_______________________________________
Title:______________________________________
THE STATE OF TEXAS ss.
ss.
COUNTY OF ______________ ss.
This instrument was acknowledged before me on the ______ day of
December, 2001, by X. Xxxxxx Xxxxxx, in his capacity as President of Briarwood
Capital Corporation, a Texas corporation, in its capacity as General Partner of
BRIARWOOD WATERS RIDGE LP, a Texas limited partnership, for and on behalf of
said corporation and limited partnership.
___________________________________________
Notary Public in and for the State of Texas
My Commission Expires:
00
XXX XXXXX XX XXXXX ss.
ss.
COUNTY OF ______________ ss.
This instrument was acknowledged before me on the ______ day of
December, 2001, by _____________________________, as ___________________ of
Ultrak GP, Inc., a Delaware corporation, in its capacity = as General Partner of
ULTRAK OPERATING, L.P., a Texas limited partnership, for and on behalf of said
corporation and limited partnership.
___________________________________________
Notary Public in and for the State of Texas
My Commission Expires:
56
Exhibit "A" to Memorandum of Lease
Legal Description
57
EXHIBIT "E"
THE WARRANT AGREEMENT
[attached following this page]
ULTRAK, INC.
AND
BRIARWOOD WATERS RIDGE LP
---------------
WARRANT AGREEMENT
Dated as of December _____, 2001
WARRANT AGREEMENT
This WARRANT AGREEMENT (this "Agreement") is dated as of December
_____, 2001, by and between ULTRAK, INC., a Delaware corporation (the
"Company"), and BRIARWOOD WATERS RIDGE LP, a Texas limited partnership (the
"Grantee").
W I T N E S S E T H:
WHEREAS, in connection with that certain Contract of Sale dated as of
December 13, 2001, by and between the Company and Grantee whereby Grantee has
agreed to purchase certain property from the Company (the "Purchase Agreement")
the Board of Directors of the Company desires to grant to Grantee warrants (the
"Warrants") to purchase 100,000 shares of common stock of the Company (the
"Common Stock");
WHEREAS, this Agreement is executed and the Warrants are granted
pursuant to the Purchase Agreement;
NOW, THEREFORE, in consideration of the premises, the agreements set
forth herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. Grant. Subject to the terms and conditions hereof, Grantee is hereby
granted Warrants by which Grantee has the right to purchase, at any time prior
to the tenth anniversary of the date of this Agreement (the "Expiration Date"),
at 5:00 p.m., Dallas, Texas time on such date, up to 100,000 shares of Common
Stock (the "Shares"). One share of Common Stock is hereinafter referred to as a
"Warrant Security" and more than one collectively referred to as the "Warrant
Securities."
2. Warrant Certificates. The warrant certificates (the "Warrant
Certificates") delivered and to be delivered pursuant to this Agreement shall be
in the form set forth in Exhibit A, attached hereto and made a part hereof, with
such appropriate insertions, omissions, substitutions, and other variations as
required or permitted by this Agreement.
3. Exercise of Warrant. The Warrants initially are exercisable at an
aggregate initial exercise price (subject to adjustment as provided in Section 8
hereof) per Warrant Security set forth in Section 6 hereof payable by certified
or official bank check, subject to adjustment as provided in Section 8 hereof.
In the alternative, each Holder may exercise its right to receive Warrant
Securities on a net basis, such that without the exchange of any funds, the
Holder receives that number of Warrant Securities otherwise issuable upon
exercise of its Warrants less that number of Warrant Securities having a fair
market value equal to the aggregate Exercise Price that would otherwise have
been paid by the Holder for the Warrant Shares being issued. Upon surrender of a
Warrant Certificate with the annexed Form of Election to Purchase duly executed,
together with payment of the Exercise Price (as hereinafter defined) for the
Warrant Securities purchased, at the Company's principal offices (presently
located at 0000 Xxxxxx Xxxxx Xxxxx, Xxxxxxxxxx, Xxxxx 75057), the registered
holder of a Warrant Certificate ("Holder" or
"Holders") shall be entitled to receive a certificate or certificates for the
shares of Common Stock so purchased. The purchase rights represented by each
Warrant Certificate are exercisable at the option of the Holders thereof, in
whole or part (but (i) not as to fractional shares of the Common Stock, and (ii)
not in increments of less than the lesser of (x) 10,000 Shares or (y) the
unexercised balance of all Warrant Securities). In the case of the purchase of
less than all Warrant Securities purchasable under any Warrant Certificate, the
Company shall cancel said Warrant Certificate upon the surrender thereof and
shall execute and deliver a new Warrant Certificate of like tenor for the
balance of the Warrant Securities purchasable thereunder.
4. Issuance of Certificates. Upon the exercise of the Warrants, the
issuance of certificates for shares of Common Stock and/or other securities,
properties or rights underlying such Warrants shall be made forthwith (and in
any event within ten (10) business days thereafter) without charge to the Holder
thereof including, without limitation, any tax which may be payable in respect
of the issuance thereof, and such certificates shall (subject to the provisions
of Sections 5 and 7 hereof) be issued in the name of, or in such names as may be
directed by, the Holder thereof; provided, however, that the Company shall not
be required to pay any tax which may be payable in respect of any transfer
involved in the issuance and delivery of any such certificates in a name other
than that of the Holder and the Company shall not be required to issue or
deliver such certificates unless or until the person or persons requesting the
issuance thereof shall have paid to the Company the amount of such tax or shall
have established to the satisfaction of the Company that such tax has been paid.
The Warrant Certificates and the certificates representing the Shares
(and/or other securities, property or rights issuable upon the exercise of the
Warrants) shall be executed on behalf of the Company by the manual or facsimile
signature of the then present Chairman or Vice Chairman of the Board of
Directors or Chief Executive Officer, President or Vice President of the Company
under its corporate seal reproduced thereon, attested to by the manual or
facsimile signature of the then present Secretary or Assistant Secretary of the
Company. Warrant Certificates shall be dated the date of execution by the
Company upon initial issuance, division, exchange, substitution or transfer.
5. Restriction On Transfer of Warrants. The Holder of a Warrant
Certificate, by its acceptance thereof, covenants and agrees that the Warrants
are being acquired as an investment and not with a view to the distribution
thereof in violation of the Securities Act (as defined below). This Agreement is
binding upon any Holder(s) of a Warrant Certificate and their respective heirs,
successors, and permitted assigns. The Holder may assign interests granted by
this Agreement in amounts equal to the lesser of (x) 10,000 Shares or (y) the
unexercised balance of all Warrant Securities, provided that the transferee
agrees to be bound by the terms of this Agreement as if such transferee were a
Holder and, provided further, that the assignment is made pursuant to an
effective registration statement under the Securities Act or a valid exemption
from registration under the Securities Act of 1933, as amended (the "Securities
Act"). If requested by the Company, the Holder must also furnish to the Company
an opinion of counsel reasonably satisfactory to the Company to such effect.
6. Exercise Price.
6.1 Initial and Adjusted Exercise Price. Except as otherwise
provided in Section 8 hereof, the initial exercise price of each Warrant shall
be $1.55 per Warrant Security. The adjusted exercise price shall be the price
which shall result from time to time from any and all adjustments of the initial
exercise price in accordance with the provisions of Section 8 hereof.
6.2 Exercise Price. The term "Exercise Price" herein shall mean
the initial exercise price or the adjusted exercise price, depending upon the
context.
7. Restrictive Legends. The Warrant Certificates, any certificates
representing the Shares underlying the Warrants and any of the other securities
issuable upon exercise of the Warrants shall bear the following restrictive
legend:
The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended (the
"Act"), and may not be offered or sold except pursuant to (i)
an effective registration statement under the Act, (ii) to the
extent applicable, Rule 144 under the Act (or any similar rule
under such Act relating to the disposition of securities), or
(iii) an opinion of counsel, if such opinion shall be
reasonably satisfactory to counsel to the issuer, that an
exemption from registration under such Act is available.
8. Adjustments to Exercise Price and Number of Securities.
8.1 Adjustments for Change in Capital Stock. If at any time after
the date of this Agreement, the Company:
(a) pays a dividend or makes a distribution on its Common Stock
exclusively in shares of its Common Stock;
(b) subdivides its outstanding shares of Common Stock into a
greater number of shares;
(c) combines its outstanding shares of Common Stock into a smaller
number of shares;
(d) pays a dividend or makes a distribution on its Common Stock in
shares of its capital stock other than Common Stock; or
(e) issues by reclassification of its Common Stock any shares of
its capital stock;
then the Holders of the unexercised Warrants shall thereafter be entitled to
receive, upon the exercise of such Warrants, the same shares of Common Stock and
other securities that they would have owned or been entitled to receive
immediately after such event as if the Warrants had been exercised immediately
prior to such event. The adjustment pursuant to this Section 8.1 shall be made
successively each time that any event listed in this Section 8.1 above shall
occur. Upon each adjustment in the number of shares for which a Warrant is
exercisable pursuant to this
Section 8.1, the Exercise Price for such Warrants shall be adjusted to equal an
amount per share of Common Stock equal to the Exercise Price before such
adjustment multiplied by a fraction, of which the numerator is the number of
shares of Common Stock for which a Warrant is exercisable immediately before
giving effect to such adjustment, and the denominator of which is the number of
shares of Common Stock for which a Warrant is exercisable immediately after
giving effect to such adjustment.
8.2 Definition of Common Stock. For the purpose of this Agreement,
the term "Common Stock" shall mean (i) the class of stock designated as Common
Stock in the Certificate of Incorporation of the Company as amended as of the
date hereof, or (ii) any other class of stock resulting from successive changes
or reclassifications of such Common Stock consisting solely of changes in par
value, or from par value to no par value, or from no par value to par value.
8.3 Merger or Consolidation. In case of any consolidation of the
Company with, or merger of the Company with, or merger of the Company into,
another corporation (other than a consolidation or merger which does not result
in any reclassification or change of the outstanding Common Stock), the
corporation formed by such consolidation or merger shall execute and deliver to
the Holder a supplemental warrant agreement providing that the holder of each
Warrant then outstanding or to be outstanding shall have the right thereafter
(until the expiration of such Warrant) to receive, upon exercise of such
Warrant, the kind and amount of shares of stock and other securities and
property receivable upon such consolidation or merger, by a holder of the number
of shares of Common Stock of the Company for which such Warrant might have been
exercised immediately prior to such consolidation, merger, sale or transfer.
Such supplemental warrant agreement shall provide for adjustments which shall be
identical to the adjustments provided in Section 8. The above provision of this
subsection shall similarly apply to successive consolidations or mergers.
8.4 No Adjustment of Exercise Price in Certain Cases.
Notwithstanding anything to the contrary contained herein, no adjustment of the
Exercise Price or number of shares of Common Stock shall be made:
(a) If the amount of such adjustment shall be less than two
cents ($.02) per Warrant Security, provided, however, that in such case any
adjustment that would otherwise be required then to be made shall be carried
forward and shall be made at the time of and together with the next subsequent
adjustment which, together with any adjustment so carried forward, shall amount
to at least two cents ($.02) per Warrant Security; or
(b) If the Exercise Price would be less than the par value per
share of Common Stock.
8.5 Statement on Warrant Certificate. Irrespective of any
adjustments in the Exercise Price or the number or kind of shares purchasable
upon the exercise of the Warrants, the Warrant Certificate or certificates
theretofore or thereafter issued may continue to express the same price and
number and kind of shares as are stated in the Warrants initially issuable
pursuant to this Agreement.
9. Exchange and Replacement of Warrant Certificates. Each Warrant
Certificate is exchangeable without expense, upon the surrender thereof by the
registered Holder at the principal executive office of the Company, for a new
Warrant Certificate of like tenor and date representing in the aggregate the
right to purchase the same number of Warrant Securities in such denominations as
shall be designed by the Holder thereof at the time of such surrender.
Upon receipt by the Company of evidence reasonably satisfactory to it of the
loss, theft, destruction or mutilation of any Warrant Certificate, and, in case
of loss, theft or destruction, of indemnity or security reasonably satisfactory
to it, and reimbursement to the Company of all reasonable expenses incidental
thereto, and upon surrender and cancellation of the Warrants, if mutilated, the
Company will make and deliver a new Warrant Certificate of like tenor, in lieu
thereof.
10. Elimination of Fractional Interests. The Company shall not be
required to issue fractional shares of Common Stock upon the exercise of
Warrants. Warrants may only be exercised in such multiples as are required to
permit the issuance by the Company of one or more whole shares of Common Stock.
If one or more Warrants shall be presented for exercise in full at the same time
by the same Holder, the number of whole shares of Common Stock which shall be
issuable upon such exercise thereof shall be computed on the basis of the
aggregate number of shares of Common Stock purchasable on exercise of the
Warrants so presented. If any fraction of a share of Common Stock would, except
for the provisions provided herein, be issuable on the exercise of any Warrant
(or specified portion thereof), the Company shall pay an amount in cash equal to
such fraction multiplied by the then current Market Price of a share of Common
Stock. As used herein, the phrase "Market Price" at any date shall be deemed to
be the last reported sale price, or, in case no such reported sale takes place
on such day, the average of the last reported sale prices for the last three (3)
trading days, in either case as officially reported by the principal securities
exchange on which the Common Stock is listed or admitted to trading or by The
Nasdaq Stock Market's National Market or SmallCap Market ("Nasdaq"), or, if the
Common Stock is not listed or admitted to trading on any national securities
exchange or quoted by Nasdaq, the average closing bid price as furnished by the
National Association of Securities Dealers, Inc. ("NASD") through Nasdaq or
similar organization if Nasdaq is no longer reporting such information, or if
the Common Stock is not quoted by the NASD or such similar organization, the
fair market value of a share of Common Stock as determined in good faith by
resolution of the Board of Directors of the Company, based on the best
information available to it.
11. Reservation of Securities. The Company shall at all times reserve
and keep available out of its authorized shares of Common Stock, solely for the
purpose of issuance upon the exercise of the Warrants, such number of shares of
Common Stock or other securities, properties or rights as shall be issuable upon
the exercise thereof. The Company covenants and agrees that, upon exercise of
the Warrants and payment of the Exercise Price therefor, all shares of Common
Stock and other securities issuable upon such exercise shall be duly and validly
issued, fully paid, non-assessable and not subject to the preemptive rights of
any stockholder.
12. Notices to Warrant Holders. Nothing contained in this Agreement
shall
be construed as conferring upon the Holders the right to vote or to consent or
to receive notice as a stockholder in respect of any meetings of stockholders
for the election of directors or any other matter, or as having any rights
whatsoever as a stockholder of the Company. If, however, at any time prior to
the expiration of the Warrants and their exercise, any of the following events
shall occur:
(a) the Company shall take a record of the holders of its
shares of Common Stock for the purpose of entitling them to receive a dividend
or distribution payable other than in cash, or a cash dividend or distribution
payable other than out of current or retained earnings, as indicated by the
accounting treatment of such dividend or distribution on the books of the
Company; or
(b) the Company shall offer to all the holders of its
Common Stock any additional shares of capital stock
of the Company or securities convertible into or
exchangeable for shares of capital stock of the
Company, or any option, right or warrant to
subscribe therefor; or
(c) a dissolution, liquidation or winding up of the
Company (other than in connection with a
consolidation or merger) or a sale of all or
substantially all of its property, assets and
business as an entirety shall be proposed;
then, in any one or more of such events, the Company shall give written notice
of such event to the Holders at least fifteen (15) days prior to the date fixed
as a record date or the date of closing the transfer books for the determination
of the stockholders entitled to such dividend, distribution, convertible or
exchangeable securities or subscription rights, or entitled to vote on such
proposed dissolution, liquidation, winding up or sale. Such notice shall specify
such record date or the date of closing the transfer book, as the case may be.
Failure to give such notice or any defect therein shall not affect the validity
of any action taken in connection with the declaration or payment of any such
dividend, or the issuance of any convertible or exchangeable securities, or
subscription rights, options or warrants, or any proposed dissolution,
liquidation, winding up or sale.
13. Notices. All notices, requests, consents and other communications
hereunder shall be in writing and shall be deemed to have been duly made and
sent when delivered, or mailed by registered or certified mail, return receipt
requested:
(a) If to the registered Holder of the Warrants, to the
address of such Holder as shown on the books of the
Company; or
(b) If to the Company, to the address set forth in
Section 3 hereof or to such other address as the
Company may designate by notice to the Holders.
14. Supplements and Amendments. The Company and Grantee may from time
to
time supplement or amend this Agreement without the approval of any Holders of
the Warrant Certificates in order to cure any ambiguity, to correct or
supplement any provision contained herein which may be defective or
inconsistent with any provisions herein, or to make any other provisions in
regard to matters or questions arising hereunder which the Company and Grantee
may deem necessary or desirable and which the Company and Grantee deem shall
not adversely affect the interests of the Holders of the Warrant Certificates.
If Grantee no longer owns any Warrants, then this Agreement may be amended by
the Company and the Holders of a majority of the then outstanding Warrants.
15. Successors. All the covenants and provisions of this Agreement
shall be binding upon and inure to the benefit of the Company, the Holders and
their respective successors and assigns hereunder.
16. Governing Law; Submission to Jurisdiction. This Agreement and
each Warrant Certificate issued hereunder shall be deemed to be a contract
made under the laws of the State of Texas and for all purposes shall be
construed in accordance with the laws of such State without giving effect to
the rules of such State governing the conflicts of laws.
17. Entire Agreement; Modification. This Agreement contains the
entire understanding between the parties hereto with respect to the subject
matter hereof and may not be modified or amended except by a writing duly
signed by the party against whom enforcement of the modification or amendment
is sought.
18. Severability. If any provision of this Agreement shall be held to
be invalid or unenforceable, such invalidity or unenforceability shall not
affect any other provision of this Agreement.
19. Captions. The caption headings of the Sections of this Agreement
are for convenience of reference only and are not intended, nor shall they be
construed as, a part of this Agreement and shall be given no substantive
effect.
20. Benefits of this Agreement. Nothing in this Agreement shall be
construed to give to any person or corporation other than the Company and
Grantee and any other registered Holder(s) of the Warrant Certificates or
Warrants Securities any legal or equitable right, remedy or claim under this
Agreement; and this Agreement shall be for the sole benefit of the Company and
Grantee and any other registered Holders of Warrant Certificates or Warrant
Securities.
21. Counterparts. This Agreement may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and such counterparts shall together constitute but one and
the same instrument.
22. Usury. It is the intention of the parties hereto to conform
strictly to any usury laws in force that apply to this transaction or any
transaction contemplated by the Purchase Agreement. Accordingly, all
agreements among the parties hereto are hereby limited so that in no
contingency shall the exercise of the Warrants plus any and all other monies
received (if such sums are deemed to be interest) contracted for, charged or
received by Grantee with respect to
this Agreement or the Purchase Agreement, exceed the Highest Lawful Rate. The
"Highest Lawful Rate" means the maximum non-usurious interest rate, if any,
that at any time or from time to time may be contracted for, taken, reserved,
charged or received under the laws of the United States and the laws of such
states as may be applicable thereto which are presently in effect or, to the
extent allowed under such applicable laws of the United States and the laws of
such states, which may hereafter be in effect and which allow a higher maximum
non-usurious interest rate than applicable laws now allow. If, from any
circumstance whatsoever, interest under any agreement to which Grantee and
Company or Grantee and Seller (as such term is defined in the Purchase
Agreement) are parties would otherwise be payable in excess of the Highest
Lawful Rate, and if from any circumstance Grantee shall ever receive anything
of value deemed interest by applicable law in excess of the Highest Lawful
Rate, then Grantee's receipt of such excess interest shall be deemed a mistake
and the same shall be repaid to Seller or credited to any unpaid principal or
any other amounts due Grantee.
23. Representations and Warranties. The Company represents and
warrants as of the date hereof as follows: (i) the Company and each of its
material Subsidiaries (including, without limitation, Ultrak Operating, L.P.,
a Texas limited partnership, and Ultrak GP, Inc., a Delaware corporation) (a)
is duly organized, validly existing, and in good standing under the laws of
the jurisdiction of its incorporation or organization, (b) has all requisite
corporate or other power and authority to own its properties and carry on its
business as now being and as proposed to be conducted, and (c) is qualified to
do business in all jurisdictions in which the nature of its business or the
ownership of its assets makes such qualification necessary and where the
failure to be so qualified would have material adverse effect upon the Company
and/or such material Subsidiary(ies); (ii) the Company has the power and
authority and legal right to execute, deliver and perform its respective
obligations under this Agreement; (iii) the execution, delivery, and
performance by the Company of this Agreement and compliance with the terms and
provisions hereof has been duly authorized by all requisite corporate or other
entity action on the part of the Company and does not and will not violate or
conflict with, or result in a breach (whether through notice or lapse of time)
of or require any consent under the Certificate of Incorporation or bylaws of
the Company or any amendments to any of the foregoing; and (iv) assuming the
truth and accuracy of Grantee's representations contained in this Agreement
that Grantee is acquiring the Warrants as an investment and not with a view to
the distribution thereof, the issuance and sale of the Warrants to Grantee
under the Warrant Agreement are exempt from the registration requirements of
the Securities Act of 1933, as amended.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK;
SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed, as of the day and year first above written.
ULTRAK, INC.,
a Delaware corporation
By:___________________________________________
Name:_________________________________________
Title:________________________________________
BRIARWOOD WATERS RIDGE LP,
a Texas limited partnership
By: Briarwood Capital Corporation,
a Texas corporation, its General Partner
By: ___________________________________
X. Xxxxxx Xxxxxx, President
EXHIBIT A
[FORM OF WARRANT CERTIFICATE]
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), AND MAY NOT BE OFFERED OR
SOLD EXCEPT PURSUANT TO (i) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT,
(ii) TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER
SUCH ACT RELATING TO THE DISPOSITION OF SECURITIES), OR (iii) AN OPINION OF
COUNSEL, IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL TO THE
ISSUER, THAT AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.
EXERCISABLE ON OR BEFORE
5:00 P.M., DALLAS, TEXAS TIME, DECEMBER ___, 2011
No. W-001 Warrants to Purchase
100,000 Shares of Common Stock
WARRANT CERTIFICATE
This Warrant Certificate certifies that BRIARWOOD WATERS RIDGE LP, a
Texas limited partnership, or registered assigns, is the registered holder of
Warrants to purchase, until the tenth anniversary of the Warrant Agreement
(the "Warrant Agreement") by and between Ultrak, Inc., a Delaware corporation
(the "Company"), and Briarwood Waters Ridge LP, a Texas limited partnership
("Grantee"), at 5:00 p.m. Dallas, Texas time on such date (the "Expiration
Date"), fully-paid and non-assessable shares of common stock, $0.01 par value
("Common Stock") of the Company, at the initial exercise price, subject to
adjustment in certain events (the "Exercise Price"), of $1.55 per share, of
Common Stock upon surrender of this Warrant Certificate and payment of the
Exercise Price at an office or agency of the Company, but subject to the
conditions set forth herein and in the Warrant Agreement dated as of December
_____, 2001, by and between the Company and Grantee. Payment of the Exercise
Price shall be made by certified or official bank check payable to the order
of the Company, or alternatively through other exercise as specified in the
Warrant Agreement.
No Warrant may be exercised after 5:00 p.m., Dallas, Texas time, on
the Expiration Date, at which time all Warrants evidenced hereby, unless
exercised prior thereto, hereby shall thereafter be void.
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of
Warrants issued pursuant to the Warrant Agreement, which Warrant Agreement is
hereby incorporated by reference in and made a part of this instrument and is
hereby referred to for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Company and the holders
(the words "holders" or "holder" meaning the registered holders or registered
holder) of the Warrants. If any term of this Warrant Certificate conflicts
with the terms of the Warrant Agreement, then the terms of the Warrant
Agreement shall control and prevail.
The Warrant Agreement provides that upon the occurrence of certain
events the Exercise Price and the type and/or number of the Company's
securities issuable thereupon may, subject to certain conditions, be adjusted.
In such event, the Company will, at the request of the holder, issue a new
Warrant Certificate evidencing the adjustment in the Exercise Price and the
number and/or type of securities issuable upon the exercise of the Warrants;
provided, however, that the failure of the Company to issue such new Warrant
Certificates shall not in any way change, alter, or otherwise impair, the
rights of the holder as set forth in the Warrant Agreement.
Upon due presentment for registration of transfer of this Warrant
Certificate at an office or agency of the Company, a new Warrant Certificate
or Warrant Certificates of like tenor and evidencing in the aggregate a like
number of Warrants shall be issued to the transferee(s) in exchange for this
Warrant Certificate, subject to the limitations provided herein and in the
Warrant Agreement, without any charge except for any tax or other governmental
charge imposed in connection with such transfer.
Upon the exercise of less than all of the Warrants evidenced by this
Certificate, the Company shall forthwith issue to the holder hereof a new
Warrant Certificate representing such numbered unexercised Warrants.
The Company may deem and treat the registered holder(s) hereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, and of any distribution to the holder(s) hereof, and for all
other purposes, and the Company shall not be affected by any notice to the
contrary.
All terms used in this Warrant Certificate which are defined in the
Warrant Agreement shall have the meanings assigned to them in the Warrant
Agreement.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK;
SIGNATURE PAGE FOLLOWS]
-----------------------
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to
be duly executed under its corporate seal.
Dated as of December __, 2001.
ULTRAK, INC.,
a Delaware corporation
By:_______________________________________
Name:_____________________________________
Title:____________________________________
[SEAL]
Attest:
_____________________________
Name:________________________
Title:_______________________
ELECTION TO PURCHASE
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to purchase ___________ shares of
Common Stock and herewith tenders in payment for such shares of Common Stock
cash or a certified or official bank check payable to the order of
___________________________________ in the amount of $__________, all in
accordance with the terms hereof. The undersigned requests that a certificate
for such shares be registered in the name of
_____________________________________, whose address is ___________________
_____________________________, and that such Certificate be delivered to whose
address is _____________________________________________________.
Dated:________________________ Signature:________________________________
(Signature must conform in all
respects to name of holder as
specified on the face of the
Warrant Certificate)
_______________________________________
_______________________________________
(Insert Social Security or Other
Identifying Number of Holder)
ASSIGNMENT
(To be executed by the registered holder if such holder
desires to transfer the Warrant Certificate)
FOR VALUE RECEIVED_____________________________________________________
hereby sells, assigns and transfers unto________________________________________
________________________________________________________________________________
(Please print name and address of transferee)
this Warrant Certificate, together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint_____________________________,
Attorney, to transfer the within Warrant Certificate on the books of the
within-named Company, with full power of substitution.
Dated:________________________ Signature:________________________________
(Signature must conform in all
respects to name of holder as
specified on the face of the
Warrant Certificate)
_______________________________________
_______________________________________
(Insert Social Security or Other
Identifying Number of Assignee)
