1
EXHIBIT 99.6
LEASE
Between
COLINAS CROSSING LP,
a Delaware limited partnership
Landlord,
And
i2 TECHNOLOGIES, INC.,
a Delaware corporation
Tenant
2
TABLE OF CONTENTS
PAGE
ARTICLE I 1
1.01. INTRODUCTORY PROVISIONS AND DEFINITIONS 1
ARTICLE 2 5
2.01. PREMISES 5
2.02. IMPROVEMENTS BY LANDLORD 6
2.03. CONDITION OF PREMISES 6
2.04. PREMISES CERTIFICATE 6
2.05 MANAGEMENT OFFICE 7
ARTICLE 3 7
3.01. TERM 7
3.02. COMMENCEMENT CERTIFICATE 7
ARTICLE 4 7
4.01. BASE RENT 7
4.02. PAYMENT OF RENT 8
4.03. SECURITY DEPOSIT 9
ARTICLE 5 10
5.01. OPERATING EXPENSE REIMBURSEMENT 10
5.02A. OPERATING EXPENSES 12
5.02B. TENANT'S ELECTRICITY CHARGE 16
5.03. PRORATION AND ADJUSTMENT OF OPERATING EXPENSES 17
5.04 TAXES 18
ARTICLE 6 19
6.01. USE 19
ARTICLE 7 19
7.01. LANDLORD'S SERVICES 19
7.02. INTENTIONALLY DELETED 23
7.03. INTERRUPTION OF SERVICES 23
7.04. KEYS AND LOCKS 24
7.05. GRAPHICS AND BUILDING DIRECTORY 24
7.06. PROJECT NAME, IDENTITY AND SIGNS 24
7.07. RISER SPACE 25
7.08. FIBER OPTIC CABLE CARRIERS 25
7.09. COMMUNICATIONS EQUIPMENT 26
7.10. ADDITIONAL HVAC COMPRESSORS 26
ARTICLE 8 26
8.01. ALTERATIONS 26
8.02. REMOVAL OF TRADE FIXTURES AND PERSONAL PROPERTY 27
8.03. REPAIRS BY LANDLORD 28
8.04. REPAIRS BY TENANT 28
ARTICLE 9 28
9.01. LANDLORD'S INSURANCE 28
9.02. TENANT'S INSURANCE 29
9.03. WAIVER OF RECOVERY 29
9.04. INDEMNITY 30
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ARTICLE 10 30
10.01. CASUALTY 30
10.02. END OF TERM CASUALTY 31
ARTICLE 11 31
11.01. CONDEMNATION 31
ARTICLE 12 33
12.01. ACCESS 33
ARTICLE 13 33
13.01. SUBORDINATION 33
13.02. ATTORNMENT 33
13.03. QUIET ENJOYMENT 33
ARTICLE 14 33
14.01. ASSIGNMENT 33
14.02. CONSENT 34
14.03. TRANSFER BY LANDLORD 34
ARTICLE 15 35
15.01. DEFAULT BY TENANT 35
15.02. RIGHTS UPON DEFAULT BY TENANT 35
15.03. EXPENSE OF REPOSSESSION 37
15.04. CUMULATIVE REMEDIES; WAIVER OR RELEASE 37
15.05. ATTORNEYS' FEES 37
15.06. FINANCIAL STATEMENTS 37
15.07. NEGATION OF LIEN FOR RENT 37
15.08. DEFAULT BY LANDLORD 38
ARTICLE 16 38
16.01. HAZARDOUS WASTE 38
ARTICLE 17 40
17.01. SUBSTITUTE PREMISES 40
17.02. ESTOPPEL LETTERS 40
17.03. HOLDOVER 40
17.04. NOTICE 40
17.05. RULES AND REGULATIONS 41
17.06. LANDLORD'S LIABILITY 41
17.07. AMERICANS WITH DISABILITIES ACT AND TEXAS
ARCHITECTURAL BARRIERS ACT 41
17.08. AUTHORIZATION 41
17.09. BROKERS 41
17.10 MEMORANDUM OF LEASE 42
17.11. PARKING 42
17.12. TIME OF ESSENCE 42
17.13. ENTIRE AGREEMENT 42
17.14. AMENDMENT 42
17.15. SEVERABILITY 42
17.16. SUCCESSORS 42
17.17. CAPTIONS 42
17.18. NUMBER AND GENDER 42
17.19. GOVERNING LAW 42
17.20. CHANGES TO THE PROJECT 42
17.21. NO PRESUMPTION AGAINST DRAFTER 42
17.22. EXAMINATION OF LEASE 43
17.23. DEFINED TERMS AND MARGINAL HEADINGS 43
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17.24. NO REPRESENTATIONS 43
17.25. IMPROVEMENTS ON ADJACENT LAND 43
17.26. SURVIVAL OF INDEMNITIES 43
17.27. COMPETITORS OF TENANT 43
17.28. RIGHT OF FIRST OFFER ON SALE 43
17.29. ARBITRATION 44
17.30. INTENTIONALLY DELETED 45
17.31 TAX PROTESTS 45
17.32 CONSENTS 45
17.33 CCR AMENDMENTS 45
17.34 MANAGEMENT 46
17.35 DEFAULT INTEREST 46
17.36 VACATING THE PREMISES 46
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EXHIBITS AND RIDERS
EXHIBIT "A" -FLOOR PLAN
-FIRST SPACE
-SECOND SPACE
-THIRD SPACE
EXHIBIT "B-1" -LEGAL DESCRIPTION OF LAND
EXHIBIT "B-2" -SITE PLAN
EXHIBIT "B-3" -ADJACENT LAND
EXHIBIT "C" -BUILDING RULES
EXHIBIT "D-1" -WORK LETTER
EXHIBIT "D-2" -BUILDING SHELL IMPROVEMENTS
EXHIBIT "E" -COMMENCEMENT CERTIFICATE
EXHIBIT "F" -PARKING GARAGE
EXHIBIT "G" -PREMISES CERTIFICATE
EXHIBIT "H" -JANITORIAL SPECIFICATIONS
EXHIBIT "I" -MEMORANDUM OF LEASE
EXHIBIT "J" -LETTER OF CREDIT
EXHIBIT "K" -SUBORDINATION, NON-DISTURBANCE AND
ATTORNMENT AGREEMENT
EXHIBIT "L-1" -BUILDING SIGN PARAMETERS
EXHIBIT "L-2" -CONTENT OF SIGNS
EXHIBIT "M" -CONTRACTOR/VENDOR RULES AND REGULATIONS
RIDER 1 -EXTENSION OPTION
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INDEX OF DEFINED TERMS
TERM PAGE
Actual Operating Expense Increase 11
ADA 41
Additional Electrical Equipment 22
Additional Rent 10
Adjacent Land 5
Agreement Period Rider 1
Base Operating Expense 10
Base Rent 7
Base Rental Rate 7
Base Year 10
Basic Services Failure 23
Bidding Contractors 55
Brokers 41
Building 5
Building Operating Hours 20
Building Shell Improvements 59
Building Stairwells 54
Building Standard Rated Electrical Design Load 21
Building Standard Services 19
CCR 3
Commencement Date 56
Common Area 4
Common Facilities 6
Communications Equipment 26
Complex 5
Construction Contract 55
Construction Costs 63
Construction Manager 55
Construction Plans 54
Cost Savings Improvements 13
Credit Assignee 34
Deck 63
Default 35
Default Interest Rate 46
Delivery Punch List Items 6
Development Agreement 8
Director 44
Effective Date 1
Environmental Law 38
Estimated Operating Expense Increase 11
Estimated Tenant's Tax Obligation 18
Exercise Notice 43
Extension Option Rider 1
Extension Term Rider 1
Finish Allowance 55
Finish Work 55
First Class Building Standards 17
First Space 2
Geographical Market 3
Hazardous Substances 38
Holidays 20
Land 5
Landlord 1
Landlord Delay 56
Lease 61
Lease Year 8
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Letter of Credit 9
Liens 27
Major Portion 56
Material Default Rider 1
NEC 21
Net Worth Reduction 9
Non-Removable Improvements 28
Notice Parties 38
Operating Expense 12
Operating Expenses 12
Parking Facilities 5
Parking Garage 5
Parking Spaces 62
Premises 5
Premises Share of Taxes 18
Primary Term 7
Prime Rate 46
Pro-Rata Reduction 9
Project 5
Project Signs 25
Quarterly Assessments 13
Rebate Agreement 18
Rent 8
Rentable Area 2
Rental Commencement Date 56
Rental Commencement Punch List Items 6
Required Capital Improvements 13
ROFO 43
ROFO Terms 43
Sale Notice 43
Second Space 2
Security Account 9
Security Amount 21
Security Areas 32
Security Desk 21
Site Plan 5
Space Plan 54
Special Assessments 13
SWB 25
Tax Stop 18
Taxing Authority 45
Tenant 1
Tenant Contract 43
Tenant Contractor 55
Tenant Improvements 54
Tenant's Electricity Charge 17
Tenant's Notice 62
Tenant's Tax Obligation 18
Tenant-Related Parties 4
Term 7
Third Space 2
Thirty Percent Level 13
Underlying Documents 33
Underlying Party 33
Warranty 15
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8
LEASE
THIS LEASE ("Lease") is entered into as of the 24th day of March, 1999
("Effective Date"), by and between COLINAS CROSSING LP, a Delaware limited
partnership ("Landlord"), and i2 TECHNOLOGIES, INC., a Delaware corporation
("Tenant").
W I T N E S S E T H:
ARTICLE 1.
==========
1.01. INTRODUCTORY PROVISIONS AND DEFINITIONS. The Lease provisions and
definitions set forth in this Section 1.01 in summary form are solely to
facilitate convenient reference by the parties. If there is any conflict between
this Section and any other provisions of this Lease, the latter shall control.
(a) Addresses for notices due
under this Lease (See
Article 17)
Landlord Name Colinas Crossing LP
And Address Eighty Eighty Xxxxx Xxxxxxx Xxxxxxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: Xxxxxx X. Means
With a copy to: Pacific Realty Associates, L.P.
00000 X. X. Xxxxxxx Xxxxxxx
Xxxxx 000
Xxxxxxxx, Xxxxxx 00000
Attn: Legal Department
With an additional copy to: Management Xxxxxx
00000 Xxxx Xxxx
Xxxxxx, Xxxxx 00000
Attn: Property Manager
Prior To Commencement Date:
Tenant Name and i2 Technologies, Inc.
Address: 000 Xxx Xxxxxxx Xxxx., Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: Xxxx Xxxxxxx and/or
V.P. of Operations
With a copy to: i2 Technologies, Inc.
000 Xxx Xxxxxxx Xxxx., Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: Adrianne Court and/or
Director of Facilities
i2 Technologies, Inc.
000 Xxx Xxxxxxx Xxxx., Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: Legal Department
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After Commencement Date:
i2 Technologies, Inc.
00000 Xxxx Xxxx
Xxxxxx, Xxxxx 00000
Attn: Xxxx Xxxxxxx and/or
V.P. of Operations
With a copy to: i2 Technologies, Inc.
00000 Xxxx Xxxx
Xxxxxx, Xxxxx 00000
Attn: Adrianne Court and/or
Director of Facilities
i2 Technologies, Inc.
00000 Xxxx Xxxx
Xxxxxx, Xxxxx 00000
Attn: Legal Department
(b) Building: One Colinas Crossing
00000 Xxxx Xxxx
Xxxxxx, Xxxxx 00000
containing approximately 180,754 square feet of total
Rentable Area. "Rentable Area" shall be measured in
accordance with 1996 BOMA National Standards ANSI Z265.
(c) Premises: Subject to the provisions of Sections 2.04 and 2.05
below, approximately 179,754 square feet of Rentable Area
on floors 1-6 of the Building. The Premises is comprised
of the "First Space" (being three (3) floors in the
Building designated by Tenant), the "Second Space" (being
two (2) floors in the Building designated by Tenant) and
the "Third Space" (being one (1) floor in the Building
designated by Tenant), all of which floor plans are set
forth on Exhibit "A" attached hereto; provided, however,
Tenant shall have the right to change such designations by
furnishing written notice to Landlord within thirty (30)
days after the Effective Date. The floor plans attached
hereto identify the Rentable Area and Usable Area of each
floor of the Premises as of the Effective Date.
(d) Parking Subject to the provisions of Section 17.11 and
Exhibit "F", as follows:
A total number of spaces equal to 720 spaces.
Uncovered Parking
525 Unreserved spaces @ $0.00 per month each during the
Primary Term hereof (and thirty (30) of such spaces shall be
marked for "i2 Visitor Parking" only)
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Covered Parking in the Parking Garage
195 reserved spaces @ $0.00 per month each during the
Primary Term hereof.
(e) Permitted Uses: The Premises are to be used and occupied by Tenant (and
its permitted assignees and subtenants) for general
business office purposes and for such other lawful
purposes as are permitted by applicable zoning laws and
that certain Declaration of Covenants, Conditions and
Restrictions dated April 6, 1994 and recorded in Volume
94066, Page 06090, Dallas County Deed Records (the "CCR")
and consistent with uses of office space in comparable
office buildings in the same geographic area in which the
Building is located ("Geographical Market"). Without
limiting the foregoing, Tenant may maintain in the
Premises (1) accounting facilities, (2) conference and/or
meeting facilities, (3) classrooms, (4) libraries, (5)
coffee bars, (6) support staff facilities (including
without limitation, word processing and copy facilities),
(7) lunchrooms, kitchen facilities, pantries and
cafeterias and/or dining rooms (including any kitchen and
support thereof) for use by Tenant and its employees and
business invitees, so long as such facilities are
installed and maintained in accordance with applicable
laws (and if alcoholic beverages are served therein,
Tenant or the operator thereof, if other than Tenant,
shall carry adequate liquor liability insurance), (8)
storage space incidental to general business office
purposes, (9) executive restrooms, including showers and
lockers, (10) audio visual, closed circuit television,
radio, electronic communication, and computer facilities,
(11) print facilities that may require special venting,
(12) photo dark room facilities, (13) health or exercise
facilities, (14) restaurants (and if alcoholic beverages
are served therein, Tenant or the operator thereof, if
other than Tenant, shall carry adequate liquor liability
insurance), (15) vending machines and snack bars for the
sale of food, confections, non-alcoholic beverages,
newspapers, convenience items and other such items to
employees and business invitees of Tenant, (16) an ATM
machine issued by a bank or other financial institution
selected by Tenant, and (17) day care facility for
exclusive use by Tenant's employees and their families,
which shall be operated in compliance with all applicable
laws. It is the intention of Landlord and Tenant that all
of the uses recited in the preceding sentence be strictly
incidental to Tenant's primary use of the Premises for
business offices and that the Premises shall not be
subleased to third parties for separate operations whose
primary purpose is to serve the general public without
Landlord's consent.
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(f) Primary Term: Eleven (11) years and zero (0) months (See Article 3).
(g) Commencement Date: June 1, 1999 (subject to the terms of Exhibit
"D-1" hereto and Section 3.01).
(h) Expiration Date: May 31, 2010 (subject to the terms of Exhibit "D-1" hereto
and Section 3.01), subject to extension pursuant to Rider 1.
(i) Tenant's Pro Rata Share: The ratio the Rentable Area of the Premises bears to the
Rentable Area of the Building. As of the Effective Date,
Tenant's Pro Rata Share is 99.45%.
(j) Base Rent: See Section 4.01
(k) Base Operating Expense: Operating Expenses per square foot of Rentable Area in the
Building for the calendar year 1999, subject to adjustment
pursuant to Section 5.03 (excluding electricity for the
Project). (See Article 5.)
(l) Security Deposit: Letter of credit in an amount equal to $4,134,342.00.
(See Section 4.03)
(m) Guarantor: N/A
(n) Tenant's Broker: Xxxxxxxx Xxxx Company Brokerage Services Division D/FW &
Xxxxx Commercial Realty Inc. (such brokers are represented
by Xxxx Xxxxxxx and Xxxx Xxxxx, respectively )
(o) Address for Payment Funds to be wired to Landlord in Portland, Oregon on a
of Base Rent: monthly basis pursuant to wiring instructions to be
furnished by Landlord at least ten (10) days in advance of
(i) the first payment due date and (ii) any subsequent
payment due date prior to which such wiring instructions
have changed.
(p) Common Area: The "Common Area" is comprised of all portions of the
Project other than the Premises and the management office.
Landlord shall not make any material changes to the
dimensions, location, configuration or design of the Common
Area (except as required by law) without Tenant's prior
written consent which shall not be unreasonably withheld.
Material changes (as used herein) shall include without
limitation changes which would convert any portion of the
Common Area to leaseable space or reduce Common Areas by
more than five percent (5%) (and, notwithstanding anything
to the contrary contained in this Lease, Tenant's consent to
these specific changes may be withheld by Tenant in its sole
discretion). Tenant and its assignees and subtenants and
their respective employees, agents, licensees and
concessionaires (the "Tenant - Related Parties") shall have
the nonexclusive right and license to use the Common Area as
constituted from time to time,
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and such use to be in common with Landlord, other tenants of
the Project, management office personnel and other persons
permitted by Landlord to use the same, and subject to such
reasonable rules and regulations governing use as Landlord
may from time to time prescribe (subject to Tenant's
consent, which consent shall not be unreasonably withheld).
Tenant shall not take any action which would unreasonably
interfere with the rights of other persons to use the Common
Area without the prior written consent of Landlord. Landlord
may temporarily close any part of the Common Area for such
reasonable periods of time as may be necessary to prevent
the public from obtaining prescriptive rights and to make
repairs or alterations, provided that Tenant's access to the
Premises shall remain available during any such period.
Landlord shall provide Tenant with reasonable advance notice
of any such temporary closings and shall endeavor to
schedule such closings during Holidays (as defined in
Section 7.01(a)) and other times outside of Building
Operating Hours (as defined in Section 7.01(a) hereof).
ARTICLE 2.
================
2.01. PREMISES. In consideration of the obligation of Tenant to pay
Rent (defined below) as herein provided and in consideration of the other terms,
covenants and conditions hereof, Landlord hereby does lease, let and demise unto
Tenant, and Tenant hereby does lease and rent from Landlord, upon and subject to
the provisions of this Lease, the 179,754 square feet of Rentable Area (subject
to the provisions of Sections 2.04 and 2.05 below) which is hereby stipulated
and for all purposes hereof agreed to be as stated in 1.01(c) above and as
reflected on the floor plan(s) attached hereto as Exhibit "A" and incorporated
herein for all purposes (such space so leased to Tenant is herein called the
"Premises") located in the building known as One Colinas Crossing (subject to
the provisions of Section 7.06(a) below) ("Building") as set forth in Article
1.01(b) and situated on the tract of land ("Land") described in Exhibit "B-1"
attached hereto and incorporated herein for all purposes (the Building, the
Land, and the parking garage ["Parking Garage"] and parking area [collectively,
"Parking Facilities"] located on the Land and shown on the site plan attached
hereto as Exhibit "B-2" ["Site Plan"] hereinafter collectively referred to as
the "Project"), TO HAVE AND TO HOLD said Premises for the Term, subject to the
provisions of this Lease. Landlord and Tenant acknowledge and agree that the
Project specifically does not include the land shown on the Site Plan which is
described on Exhibit "X-0" ("Xxxxxxxx Xxxx") and the improvements thereon, a
portion of which Adjacent Land is owned by Landlord and a portion of which is
subject to certain agreements between Landlord and Tenant as set forth in this
Lease and in the Development Agreement (defined below). The Land and the
Adjacent Land, and the improvements thereon, comprise the complex commonly
referred to as Colinas Crossing ("Complex").
Subject to the terms of this Lease, Tenant shall be entitled to the
following as appurtenances to the Premises: the right to use (i) the Parking
Facilities and other areas of the Project in accordance with Section 17.11 and
Exhibit "F" to this Lease, (ii) the roof of the Building and/or the Parking
Facilities in accordance with Sections 7.09 and 7.10 hereof, (iii) riser space
in the core of the Building pursuant to Section 7.07 hereof, (iv) for Tenant's
exclusive use, the restrooms on floors leased entirely by Tenant and, for
Tenant's nonexclusive use, the restrooms on floors partly, but not entirely,
leased by Tenant, (v) for Tenant's nonexclusive use (subject to the other
provisions of this Lease), the telephone and electric closets on floors leased
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entirely by Tenant, and (vi) in common with Landlord and other tenants or
occupants of the Project, their invitees and guests and others, all lobbies,
driveways, sidewalks and other areas and facilities on the Land, in the Building
and other portions of the Project from time to time intended for the common use
of tenants in the Project, and all rights and benefits appurtenant to, or
necessary or incidental to, the use and enjoyment of the Premises by Tenant for
the purposes set forth in Section 1.01(e) above, including, but not limited to,
the right of Tenant, its employees and invitees, in common with Landlord and
other persons, to the benefits of any reciprocal easements and/or use agreements
burdening and/or benefiting the Project (including without limitation, the CCR)
to the extent necessary or incidental to the use and enjoyment of the Premises
for the purposes permitted by Section 1.01(e), including without limitation, the
right to use the "Common Facilities" (defined in the CCR) pursuant to the terms
of the CCR.
2.02. IMPROVEMENTS BY LANDLORD. On the Effective Date, Landlord shall
deliver the Premises to Tenant with the Building Shell Improvements (as such
term is defined in Exhibit "D-2" attached hereto) completed all in accordance
with Exhibit "D-2" (excluding Delivery Punch List Items [defined below]).
Construction of the Tenant Improvements (defined in Exhibit "D-1") for the
Premises will be accomplished and the cost of such construction will be paid in
accordance with Exhibit "D-1" attached hereto and made a part hereof.
2.03. CONDITION OF PREMISES. Except as provided in this Lease
(including without limitation, Section 2.02 and Exhibits "D-1" and "D-2" of this
Lease), Tenant acknowledges that Landlord has not undertaken to perform any
modification, alteration, or improvement to the Premises. Landlord represents
and warrants to Tenant that (i) all Building and Project systems are new and in
good working order, (ii) the Project is in accordance with all applicable laws,
regulations, ordinances and codes, (iii) Landlord is the fee owner of the Land
and the Adjacent Land and the Land and the Adjacent Land are not subject to any
ground leases, mortgages, deeds of trust or other security instruments, (iv) the
City of Farmers Branch has heretofore issued a temporary shell certificate of
occupancy with respect to the Project (including without limitation, the Parking
Garage and the Building) and Tenant can commence its Tenant Improvements work at
any time after the Effective Date in accordance with Exhibit "D-1", and (v) the
Building Shell Improvements in the Premises have been completed except for
Delivery Punch List Items. Landlord has not made any representations or
warranties with respect to the Project or the Premises except for those set
forth in this Lease. As used herein, "Delivery Punch List Items" shall mean
incomplete work items following substantial completion of the Building Shell
Improvements which do not interfere with Tenant's construction of the Tenant
Improvements. As used herein, "Rental Commencement Punch List Items" shall mean
incomplete work items following substantial completion of the Building Shell
Improvements which do not interfere with Tenant's business operations.
2.04. PREMISES CERTIFICATE. Exhibit "A" sets forth the square footage
of Rentable Area of each floor or portion thereof comprising the Premises. Prior
to the Commencement Date, Landlord shall execute and deliver to Tenant an
Exhibit "G" attached hereto, which shall contain Landlord's calculation of the
exact number of square feet of Rentable Area within each floor of the Premises
as of such date, including a breakdown of Landlord's calculations with regard to
Common Areas and the Rentable Area of the Building. Tenant shall have the right
to object to Exhibit "G" by delivering notice to Landlord within thirty (30)
days after Landlord delivers Exhibit "G" to Tenant, failing which Tenant shall
be deemed to have agreed that the information contained in Exhibit "G" is
correct and Tenant shall be required to execute Exhibit "G" within five (5) days
after the expiration of such 30-day period. If Tenant objects to Exhibit "G"
within said thirty (30) day period, Landlord and Tenant shall work together to
resolve their differences, failing which the disputes shall be submitted to
arbitration under Section 17.29. After such differences have been resolved
between Landlord and Tenant or by arbitration, Landlord and Tenant shall execute
the corrected Exhibit "G". Tenant shall have the right during such thirty (30)
day period to have Tenant's architect make field measurements of the Project,
Premises, and common areas provided Tenant furnishes Landlord with one (1)
Business Day prior notice of the date such measurements are to be made. Upon the
execution of Exhibit "G" by Landlord and Tenant for all floors of the Premises
and the Project, the Rentable Area of all floors in the Premises and the Project
as shown on the executed Exhibit "G" shall replace the Rentable Area of the
Premises and the Project as shown in Exhibit "A" and in Section 1.01(c) of
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this Lease and shall be deemed to be the Rentable Area of the Premises and the
Project as of such date for all purposes under this Lease.
2.05. MANAGEMENT OFFICE. As of the date hereof, the management office
for the Project consists of 1,000 square feet of Rentable Area and is located in
the area shown on Exhibit "A". If Tenant desires Landlord to relocate the
management office to another area of the Building, Tenant shall forward written
notice to Landlord within ten (10) business days after the Effective Date. If
Tenant makes such request, Landlord and Tenant shall work together, acting
reasonably and in good faith, to select another location in the Building within
five (5) days of Tenant's request which does not interfere with Tenant's space
planning needs (and in no event shall the relocated management office exceed
1,000 square feet of Rentable Area). If pursuant to this paragraph the square
footage of the management office is reduced to less than 1,000 square feet, the
square footage of the Premises shall be adjusted accordingly (subject to
confirmation pursuant to Section 2.04) to recognize that the Premises and the
management office shall aggregate 100% of the Rentable Area in the Building.
Tenant shall pay for all costs of any such relocation.
ARTICLE 3
==============
3.01. TERM. The initial term of this Lease shall be for a term of
eleven (11) years ("Primary Term") commencing as to each Major Portion (defined
in Exhibit "D-1") on the Rental Commencement Date for such portion and
continuing as to all of the Premises until the day immediately preceding the
eleventh (11th) anniversary of the Commencement Date (defined in Exhibit "D-1");
provided, however, if the Primary Term commences on a date other than the first
day of a calendar month, Landlord and Tenant shall be deemed to have agreed that
the Primary Term shall be extended through the last day of the calendar month in
which the expiration date falls. The Primary Term of this Lease may be renewed
and extended pursuant to Rider 1 to this Lease (the Primary Term and, to the
extent renewed and extended, any such renewal terms are hereinafter called the
"Term").
3.02. COMMENCEMENT CERTIFICATE. Within five (5) days after the
Commencement Date, Landlord shall submit to Tenant a certificate in the form
attached hereto as Exhibit "E" to confirm the occurrence of the Commencement
Date for the Premises. Tenant shall have the right to object to Exhibit "E"
within thirty (30) days after Landlord delivers Exhibit "E" to Tenant, failing
which Tenant shall be deemed to have agreed that all information contained in
Exhibit "E" is correct. If Tenant objects to Exhibit "E" within said thirty (30)
day period, Landlord and Tenant shall work together to resolve their
differences, failing which the dispute may be submitted to arbitration pursuant
to Section 17.29. Immediately upon resolution of such differences, Landlord and
Tenant shall execute and deliver the corrected Exhibit "E".
ARTICLE 4.
===============
4.01. BASE RENT.
(a) Subject to the provisions of subsections (b) and (c) below, Tenant,
in consideration for this Lease and the leasing of the Premises for the Term,
agrees to pay to Landlord commencing on the Rental Commencement Date (defined in
Exhibit "D-1") as to each Major Portion (defined in Exhibit "D-1") of the
Premises, base rental ("Base Rent") equal to the product of the (i) annual rate
("Base Rental Rate") set forth below for the applicable Lease Year, multiplied
by (ii) the square feet of Rentable Area comprising the Major Portion of the
Premises for which the Rental Commencement Date has occurred.
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Lease Years Base Rental Rate
----------- ----------------
1 - 5 $23.00
6 - expiration of the
Primary Term $24.50
As used herein, "Lease Year" shall mean a period of one (1) year;
provided, however, the first (1st) Lease Year for the Premises shall commence on
the Commencement Date and end on the date next preceding the first anniversary
thereof; and provided further, Lease Year 2 as to the Premises shall commence
upon the expiration of Lease Year 1 with respect to such space and all
subsequent Lease Years shall commence upon the expiration of the prior Lease
Year with respect to such space.
(b) Notwithstanding the foregoing, if the Rental Commencement Date for
the First Space occurs prior to June 1, 1999, the Rental Commencement Date for
the Second Space occurs prior to September 1, 1999, and/or the Rental
Commencement Date for the Third Space occurs prior to December 1, 1999, then
Tenant shall be obligated to pay Base Rental as to the applicable space for
which the early Rental Commencement Date occurred for the period from the early
Rental Commencement Date until (i) June 1, 1999, as to the First Space (if
applicable), (ii) September 1, 1999, as to the Second Space (if applicable)
and/or (ii) December 1, 1999, as to the Third Space (if applicable), at one-half
of the Base Rental Rate set forth above.
(c) Notwithstanding the foregoing, if Tenant exercises the Building 2
Option (defined in that certain Development Agreement dated of even date
herewith between Landlord and Tenant (the "Development Agreement"), the Base
Rental Rate for all of the Premises shall be automatically reduced in this Lease
for the period commencing at the beginning of the sixth (6th) Lease Year and
continuing through the remainder of the Primary Term by 25/100 Dollars ($0.25)
per square foot of Rentable Area.
4.02. PAYMENT OF RENT. As used in this Lease, "Rent" shall mean the
Base Rent, the Operating Expense reimbursements pursuant to Section 5.01,
Tenant's Electricity Charge pursuant to Section 5.02B, and all other monetary
obligations provided for in this Lease to be paid by Tenant, all of which shall
constitute rental in consideration for this Lease and the leasing of the
Premises. Tenant shall send Base Rent and other sums due hereunder in legal
tender of the United States of America to Landlord. Base Rent shall be sent by
wire transfer pursuant to the instructions set forth in Section 1.01(o) or to
such other person or at such other address or pursuant to such different wiring
instructions as Landlord may from time to time designate at least ten (10) days
in advance in writing. Rent other than Base Rent shall be paid in a manner
mutually agreeable to Landlord and Tenant. Landlord and Tenant may from time to
time mutually agree to an alternative manner of payment of any portion of Rent.
The Rent shall be paid without notice, demand, abatement, deduction, or offset
except as may be expressly set forth in this Lease. Upon execution of this
Lease, Tenant shall pay to Landlord an amount equal to $172,500, which shall be
applied to the first month's Base Rent due hereunder on the first Rental
Commencement Date.
Tenant shall pay to Landlord a late charge equal to five percent (5%)
of the amount of Rent due for all Rent which is not paid on or before the fifth
(5th) day following the date such amount is due. Any payments made by Tenant to
Landlord hereunder shall not be deemed a waiver by Landlord of any rights
against the Tenant. The collection of such late charge by Landlord shall be in
addition to and cumulative of any and all other remedies available to such
party.
It is the intention of Landlord and Tenant to conform to all applicable
laws concerning the contracting for, charging and receiving of interest. In the
event that any payments of interest required under this Lease are ever found to
exceed any applicable limits, the charging party shall credit the amount of any
such excess paid by the other party against any amount owing under this Lease or
if all amounts owning under this Lease have been paid, the charging party shall
refund to the other party the amount of such excess. Landlord and Tenant agree
that Landlord shall not be subject to any applicable penalties in connection
with any such excess interest, it being agreed that any such excess interest
contracted for, charged or received pursuant to this Lease shall be deemed a
result of a bona fide error and a mistake. The obligation of Tenant to pay Rent
is an
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independent covenant, and no act or circumstance, whether constituting a breach
of covenant by Landlord or not, shall release or modify Tenant's obligation to
pay Rent except as otherwise provided in this Lease.
4.03. SECURITY DEPOSIT. Upon execution of this Lease, Tenant shall
furnish, and (except as otherwise provided in this Section 4.03) maintain in
effect at all times during the Term hereof, an irrevocable standby letter of
credit in the initial amount of $4,134,342.00 as security for the timely
performance of Tenant's obligations hereunder, in substantially the form set
forth on Exhibit "J" hereto (the "Letter of Credit"). Landlord may draw upon the
Letter of Credit in part upon any Default by Tenant (which continues beyond the
notice and cure periods) to the extent necessary to cover the sums in (i) and
(ii) below. In the event that Landlord draws on such letter of credit following
a Default by Tenant, Landlord shall apply the proceeds thereof to the extent
required (i) to the cost of curing such Default then existing and uncured, and
(ii) if this Lease or Tenant's right to possession of the Premises is terminated
as the result of such Default, to any and all other damages to which Landlord
may be entitled under this Lease. Tenant shall restore the Letter of Credit to
the amount existing prior to such partial draft within ten (10) business days
following Tenant's receipt of notice from Landlord of such partial draft,
failing which Landlord may draw the entire remaining amount available under such
Letter of Credit provided Landlord complies with the provisions below.
Additionally, in the event that the issuing bank notifies Landlord that it will
not renew the Letter of Credit, then Tenant shall have the right to substitute a
Letter of Credit from another financial institution reasonably acceptable to
Landlord prior to the expiration date, failing which Landlord shall have the
right to draw the balance then existing under the Letter of Credit.
Additionally, Tenant may at any time replace the Letter of Credit with a Letter
of Credit from another financial institution reasonably acceptable to Landlord.
Any amount so drawn by Landlord and not applied by Landlord as provided
in (i) and (ii) of the preceding paragraph shall be held as an interest bearing
security deposit for the timely performance of Tenant's obligations hereunder
("Security Account"). Such amount shall be held by Landlord in trust and in a
separate bank account which shall not be commingled with Landlord's other funds.
Such amount shall not constitute an advance payment of rent. Interest earned
thereon shall be for Tenant's benefit and Landlord shall arrange for interest
thereon to be paid to Tenant as requested by Tenant, except to the extent used
to replenish partial drafts. Payment of amounts due under this Lease from the
proceeds of a draw under the Letter of Credit will not relieve Tenant of the
obligation to pay such amount or prevent Tenant's failure to make such payment
from constituting a Default by Tenant, except to the extent Tenant restores the
Letter of Credit to the amount existing prior to Landlord's partial draft
thereon (in which event the sums held in the Security Account shall be returned
to Tenant within fifteen (15) days thereof). Landlord may assign its interest in
the Letter of Credit only in connection with an assignment of this Lease, it
being understood and agreed that Landlord may make an absolute or collateral
assignment of the Letter of Credit in connection with a financing or refinancing
of the Project. Within fifteen (15) days after the expiration or earlier
termination of this Lease the Letter of Credit or sums in the Security Account
(as applicable) shall be returned to Tenant.
The amount of the Letter of Credit required shall be reduced (the
"Pro-Rata Reduction") as of each anniversary of the Commencement Date by an
amount equal to one-eleventh (1/11) of the full initial amount thereof;
provided, however, that each such reduction shall be conditioned upon Tenant's
net worth or shareholders' equity (as applicable) upon each anniversary of the
Commencement Date being not less than Two Hundred Thirty-Five Million Dollars
($235,000,000), as reflected on the most recent Form 10K or Form 10Q filed
pursuant to applicable securities laws.
In addition to the foregoing, the amount of the Letter of Credit
required shall also be reduced (a "Net Worth Reduction") to: (a) seventy-five
percent (75%) of the then-existing amount thereof at such time as Tenant's net
worth or shareholders' equity (as applicable) equals or exceeds Three Hundred
Fifty Million Dollars ($350,000,000); (b) fifty percent (50%) of the
then-existing amount thereof at such time as Tenant's net worth equals or
exceeds Four Hundred Million Dollars ($400,000,000); and (c) twenty-five percent
(25%) of the then-existing amount thereof at such time as Tenant's net worth or
shareholders' equity (as applicable) equals or exceeds Four Hundred Fifty
Million Dollars ($450,000,000). Additionally, Tenant's obligation to
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maintain the Letter of Credit shall terminate at such time as Tenant's net worth
or shareholders' equity (as applicable) equals or exceeds Five Hundred Million
Dollars ($500,000,000), in which event Landlord shall return the Letter of
Credit to Tenant within fifteen (15) days of Tenant's request. As used in this
paragraph, Tenant's net worth or shareholders' equity (as applicable) shall be
the net worth or shareholders' equity (as applicable) reflected in the Form 10K
or Form 10Q required to be filed by applicable securities laws immediately
preceding such reduction or termination, as the case may be.
It is understood and agreed that the Pro-Rata Reduction shall
not be applicable if upon any anniversary of the Commencement Date the amount of
the Letter of Credit has been reduced to an amount less than what the Pro-Rata
Reduction would effect, by virtue of Tenant's previously having qualified for a
Net Worth Reduction.
It is also understood and agreed that if Landlord holds sums in the
Security Account, the Pro Rata Reduction and the Net Worth Reduction shall also
apply to the Security Account, and Landlord shall pay to Tenant the amounts
which are so reduced within fifteen (15) days of the occurrence of the Pro Rata
Reduction or the Net Worth Reduction (as applicable). Further, in no event shall
the Letter of Credit or Security Account be increased for any reason once either
has been reduced as the result of a Pro Rata Reduction or a Net Worth Reduction.
Notwithstanding anything to the contrary contained herein, in
determining Tenant's shareholders' equity for purposes of this Section 4.03, (i)
non-cash charges to Tenant's income statement or balance sheet from mergers
and/or acquisitions shall be added back to Tenant's shareholders' equity for
purposes hereof, and (ii) any reduction to shareholders' equity as a result of
Tenant entering into a merger and/or acquisition accounted for as a pooling of
interests shall be added back to Tenant's shareholders' equity for purposes
hereof.
Upon the occurrence of a Pro Rata Reduction or a Net Worth Reduction,
Tenant shall be permitted to provide Landlord with either (i) a substitute
Letter of Credit for the reduced amount, in which event Landlord shall return
the existing Letter of Credit to Tenant within fifteen (15) days of receipt of
the new Letter of Credit, or (ii) an amendment to the Letter of Credit, in which
event Landlord will sign the amendment and return it to Tenant within fifteen
(15) days of receipt of the amendment.
ARTICLE 5.
============
5.01. OPERATING EXPENSE REIMBURSEMENT. The Base Rent payable under
Section 4.01 of this Lease includes an annual allocation for operating expenses
equal to the Base Operating Expense (defined below) per square foot of Rentable
Area of the Premises. As used herein, "Base Operating Expense" shall mean
Operating Expenses (defined in Section 5.02 hereof) for the calendar year 1999
determined in accordance with this Article 5, which calendar year 1999 shall be
referred to herein as the "Base Year." In the event that Operating Expenses
(defined in Section 5.02A hereof) of the Project during any calendar year of the
Term shall exceed the Base Operating Expense, Tenant shall pay to Landlord
Tenant's Pro Rata Share of the increase in such Operating Expenses over the Base
Operating Expense in accordance with the procedures below ("Additional Rent").
Notwithstanding the foregoing, in no event is Tenant obligated to pay any
Additional Rent with respect to calendar year 1999.
On or before January 1, 2000 and on or before the first day of each
calendar year thereafter during the Term, Landlord shall provide to Tenant the
Estimated Operating Expense Increase (defined below) for the upcoming year. In
addition to the Base Rent, Tenant shall pay in advance on the first day of each
calendar month during the Term, installments equal to 1/12th of Tenant's Pro
Rata Share of the Estimated Operating Expense Increase, if any.
Within one hundred twenty (120) days after the end of each calendar
year during the Term, Landlord shall furnish to Tenant a written detailed
statement, certified by Landlord's group controller or other Project officer
knowledgeable of the facts that the statement has been prepared
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in accordance with this Lease, of the Actual Operating Expense Increase
(hereinafter defined) for the immediately preceding calendar year, which
statement shall itemize each category of Operating Expenses and set forth
Landlord's calculations of Tenant's Pro Rata Share of the Actual Operating
Expense Increase. If Tenant's Pro Rata Share of the Estimated Operating Expense
Increase paid to Landlord during the previous calendar year exceeds Tenant's Pro
Rata Share of the Actual Operating Expense Increase, then Landlord shall refund
the difference to Tenant at the time Landlord furnishes the statement of the
Actual Operating Expense Increase. If Tenant's Pro Rata Share of Estimated
Operating Expense Increase paid to Landlord during the previous calendar year is
less than Tenant's Pro Rata Share of the Actual Operating Expense Increase, then
Tenant shall pay to Landlord the amount of such underpayment. Unless Tenant
takes written exception to any item within one hundred twenty (120) days after
the furnishing of such annual statement to Tenant, such statement shall be
considered final and accepted by Tenant (unless an error in Landlord's statement
is discovered with respect to any particular line item of Operating Expenses, in
which event Tenant shall have the additional audit rights described below). Any
amount due Landlord as shown on any such statement shall be paid by Tenant
within thirty (30) days after it is furnished to Tenant subject to Tenant's
audit right provided below.
Tenant shall have the right to perform an annual audit at Tenant's
expense on Landlord's books and records to the extent necessary to verify
Landlord's calculation of the Base Operating Expense and/or the Actual Operating
Expense Increase for the prior calendar year, provided that such audit shall be
conducted by its internal audit group or a Certified Public Accountant and
further provided that the auditor's report reflecting the results of such audit
shall be promptly delivered to Landlord. Any such audit shall be conducted, if
at all, (i) within one hundred eighty (180) days after the receipt of the annual
statement of the Base Operating Expense or the Actual Operating Expense Increase
(as applicable) from Landlord (unless an error in Landlord's statement is
discovered with respect to any particular line item of Operating Expenses, in
which event Tenant or such certified public accounting firm (on Tenant's behalf)
shall be allowed to examine Landlord's books and records for the two (2) years
preceding the most recently completed calendar year statements, but only with
respect to the line item(s) which is/are found to be in error), (ii) during
Landlord's normal business hours, (iii) at the place in Dallas, Texas where
Landlord maintains its records (or such other place in Dallas, Texas as Landlord
shall deliver the appropriate records) and (iv) only after Landlord has received
thirty (30) days prior written notice. Landlord agrees to cooperate in good
faith with Tenant in the conduct of any such audit. If the audit report reflects
an overcharge in the Actual Operating Expense Increase of more than two percent
(2%) of the total Actual Operating Expense, then Landlord shall reimburse Tenant
for all reasonable costs incurred by Tenant due to such audit plus interest on
such overpayment at the Default Interest Rate. Interest on all overpayments or
underpayments discovered by such audit shall be calculated as follows: (i)
one-twelfth (1/12th) of the overpayment or underpayment shall be deemed to have
been paid on the first day of each calendar month in the calendar year to which
such overpayment or underpayment relates, and (ii) each such deemed payment
shall bear interest at the Default Interest Rate, from the date deemed paid
until the overpayment or underpayment is paid to Tenant or Landlord, as the case
may be. If the audit report reflects that the Actual Operating Expense Increase
was overstated or understated in the audited calendar year, Tenant shall, within
twenty (20) days after receipt of such report, pay to Landlord the amount of any
underpayment or, if applicable, Landlord shall pay to Tenant the amount of any
overpayment. Any disputes may be resolved by arbitration pursuant to Section
17.29.
The "Estimated Operating Expense Increase" shall equal Landlord's good
faith and reasonable estimate of Operating Expenses for the applicable calendar
year, less the Base Operating Expense. Landlord's statement of the Estimated
Operating Expense Increase shall control for the year specified in such
statement and for each succeeding year during the Term until Landlord provides a
new statement of the Estimated Operating Expense Increase. The "Actual Operating
Expense Increase" shall equal the actual Operating Expenses for the applicable
calendar year, less the Base Operating Expense. If Operating Expenses change
during a calendar year or if the number of square feet of Rentable Area in the
Premises changes, Landlord may revise the estimated Additional Rent two (2)
times during such year by giving Tenant written notice to that effect and
thereafter Tenant shall pay to Landlord, in each of the remaining months of such
year, an amount commensurate with the change in the estimated Additional Rent
divided by the number of months remaining in such year.
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5.02A. OPERATING EXPENSES. The term "Operating Expenses" shall mean and
include all those reasonable amounts, expenses, and costs of whatsoever nature
(other than electricity for the Project) that Landlord incurs, pays or becomes
obligated to pay because of or in connection with the ownership, operation,
management, repair, or maintenance of the Project. Operating Expenses shall be
determined on an accrual basis in accordance with generally accepted accounting
principles consistently applied and shall include, without limitation, the
following:
(a) Wages, salaries, fees, related taxes, insurance, benefits, and
reimbursable expenses of all personnel engaged in operating, repairing, and
maintaining the Project and providing traffic control about the Project;
provided, however, that (i) if during the Term such personnel are also working
on other projects being operated by Landlord, their wages, salaries, fees and
related expenses shall be allocated by Landlord in good faith among all of such
projects and only that portion of such expenses allocable to the Project shall
be included as an "Operating Expense," and (ii) such wages, salaries, fees,
taxes, insurance, benefits and expenses for personnel senior to the most senior
property manager responsible for the day-to-day operation of the Project and
executives of Landlord or Landlord's affiliates shall be excluded.
(b) Cost of all labor, supplies, tools, equipment and materials used in
operating, repairing, and maintaining the Project (excluding costs paid by
proceeds of condemnation or insurance).
(c) The actual cost of all utilities (except for electricity for the
Project) for the Project, including, without limitation, water, sewer charges,
gas and fuel oil, less any rebates, credits or reductions paid to Landlord by
the provider of any such utilities (and in no event may Landlord charge any
xxxx-up on such utilities).
(d) Cost of all maintenance (including specifically, without
limitation, roof maintenance and maintenance of the Building systems), security
(to the extent performed by Landlord rather than Tenant), window cleaning,
elevator maintenance, landscaping, repair, janitorial, and other similar service
agreements for the Project and the equipment and other personal property of
Landlord therein and thereon used in connection with the operation, management,
repair or maintenance of the Project.
(e) Cost of all insurance relating to the Project and its occupancy or
operations, including but not limited to (i) the cost of casualty and liability
insurance applicable to the Project or Landlord's personal property used in
connection with the operation of the Project, (ii) the cost of business
interruption insurance in such amounts as will reimburse Landlord for all losses
of earnings and other income attributable to the ownership and operation of the
Project for one (1) year, and (iii) the cost of insurance against such perils
and occurrences as are commonly insured against by prudent landlords
(specifically including, without limitation, floods and earthquakes).
(f) Costs of repairs to and maintenance of the Project undertaken by
Landlord, excluding any such costs as are paid by the proceeds of insurance or
condemnation proceeds, by Tenant, or by other third parties, and excluding any
alterations of space occupied by other tenants of the Building.
(g) A management fee for management services rendered in connection
with the Project, which fee shall not exceed three percent (3%) of the gross
revenues received by Landlord with respect to the Project for any calendar year
(provided, however, in determining the Base Operating Expense, the management
fee included shall be determined based on the annualized rent payable by Tenant
in Lease Year 2 and the management fee percentage so included in Operating
Expenses cannot be increased during the Primary Term and any Extension Term
after the Base Year). The management fee percentage for each Extension Option
shall not exceed three percent (3%) of the gross revenues received by Landlord
with respect to the Project for the Base Year used for such Extension Term.
(h) Amortization of (a) Required Capital Improvements, and (b) Cost
Savings Improvements to the extent of the actual savings, plus reasonable
financing costs (at an annual
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rate equal to the lesser of (A) one percent (1%) over the Prime Rate, or (B) the
maximum lawful rate). "Required Capital Improvements" shall mean capital
improvements or replacements made in or to the Project in order to conform to
any applicable laws or amendment thereto (to the extent of such amendment only)
which becomes effective after the Commencement Date (including any amendments to
ADA or TAS [to the extent of such amendments only] which become effective after
the Commencement Date. "Cost Savings Improvements" shall mean any capital
improvements or replacements which reduce Operating Expenses. The cost of Cost
Savings Improvements and Required Capital Improvements will be amortized by
spreading such costs on a straight line basis over its useful life using
generally accepted accounting principles.
(i) Landlord's central accounting costs, legal fees, and other such
third party fees relating to the operation of the Project (but excluding
accounting and legal services in connection with negotiations and disputes with
specific tenants).
(j) Rent for the property manager's office, if any, in the Building
(not exceeding fair market rents for comparable space in the Geographical Market
and not to exceed 1,000 square feet of Rentable Area) but excluding the rent for
a pro rata portion of such office to the extent such office is not used solely
for the management of the Project (e.g., if a portion of such office is used for
leasing activities or development activities or for management of buildings
other than the Project, a pro rata portion of such rent shall not be included
based upon the percentage of activities conducted in the office other than
management of the Project).
(k) The Project's share of quarterly assessments for maintaining the
"Common Facilities" (as defined in the CCR) authorized by Section 4.03 of the
CCR ("Quarterly Assessments"), as such share is determined under the CCR.
(l) The Project's share (as determined pursuant to the CCR) of all
special assessments authorized by Section 4.04 of the CCR ("Special
Assessments") if the aggregate of the Project's share of Special Assessments in
any calendar year are less than thirty percent (30%) of the actual Project's
share of Quarterly Assessments included in Operating Expenses the previous
calendar year pursuant to clause (k) above ("Thirty Percent Level"). If the
aggregate of the Project's share of Special Assessments in any calendar year
equals or exceeds the Thirty Percent Level, then the aggregate amount of the
Special Assessments in such calendar year shall be amortized to spread such
costs on a straight line basis at the rate of 10% per annum over the useful life
of the improvements comprising the Special Assessment and included in Operating
Expenses on such basis (in lieu of 100% of such Special Assessments being
included in the year of the Special Assessment).
(m) Costs incurred by Landlord in maintaining the Common Areas.
(n) All reasonable costs incurred by Landlord in connection with
Landlord's protests of real estate taxes assessed upon the Project, including,
without limitation, appraisal costs, tax consultant charges and reasonable
attorney's fees.
Nothing contained in this Section 5.02 shall be construed as requiring
Landlord to provide any services which are not specifically set forth in this
Lease as obligations of Landlord.
Notwithstanding anything herein to the contrary, and in addition to the
exclusions and limitations on Operating Expenses set forth above, the following
items shall be excluded from Operating Expenses:
(1) Costs incurred in connection with the initial construction
of the Project;
(2) Except to the extent provided specifically in subsection
(h) above as to the Project only (and not any premises of
tenants), costs of alterations or improvements of the Project,
the Premises, and the premises of tenants in other areas of
the Building, including any alterations and improvements
necessary for any of such premises to comply with the ADA (as
defined in Section 17.07) or Texas Accessibility Statute
(TAS);
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(3) Interest, principal payments, and other costs of any
indebtedness encumbering the Building or the Project;
(4) Costs of correcting latent defects of the construction of
the Project, the improvements within the Premises, or the
premises of other Building tenants.
(5) Depreciation and any other non-cash expense items;.
(6) Legal fees, space planner's fee, architectural fees, real
estate commissions, and marketing and advertising expenses
incurred in connection with leasing and construction of the
Project or any improvements on the Land;
(7) Costs of repairs, restoration, replacements or other work
that are otherwise includable as Operating Expenses but are
occasioned by (1) fire, windstorm or other casualty of an
insurable nature (whether such destruction be total or
partial) and (aa) payable by insurance required to be carried
by Landlord under this Lease (whether or not such insurance is
actually carried), or (bb) otherwise paid by insurance then in
effect obtained by Landlord, (2) the exercise by a
governmental authority of the right of eminent domain, whether
such taking be total or partial, or (3) the act of any other
tenant in the Project, or any other tenant's agents,
employees, licensees or invitees;
(8) Any bad debt losses, rent losses or losses or reserves for
bad debt or rent losses;
(9) Costs associated with the operation of the business of the
legal entity which constitutes Landlord as the same is
distinguished from the cost and operation of the Building,
including legal entity information, internal entity accounting
and legal matters;
(10) Costs of defending any lawsuits with mortgagees or
potential Building purchasers (except as the actions of Tenant
may be an issue) now or in the future;
(11) Costs of selling, syndicating, financing, mortgaging, or
hypothecating any of the Landlord's interest in the Project or
the other improvements located on the Land;
(12) Costs of disputes between Landlord and any third party
not relating to the operation of the Building or Project;
(13) The wages of employees who do not directly devote the
majority of their time to the Building; provided, however, the
reasonable costs associated with such employees who do not
devote the majority of their time to the Building may be
reasonably prorated for such an amount shall be included as an
Operating Expense to the extent that such employees devote
their time to the Building and are not (i) senior to the most
senior property manager responsible for the day-to-day
operation of the Project, or (ii) executives of Landlord or
Landlord's affiliates;
(14) Unless otherwise permitted for the reduction of Operating
Expenses in subsection (i) above, the cost of replacement of
HVAC, mechanical, security, electrical, plumbing systems,
replacement of the foundations, floors, walls, roofs, and
structural elements of the Building outside the scope of
routine maintenance and repair;
(15) Expenses directly relating to the gross negligence of the
Landlord or its employees or agents or the cost of any claim
that Landlord was required to have insured against pursuant to
the terms of this Lease;
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(16) All amounts that would otherwise be included in Operating
Expenses which are paid to Landlord, any affiliate of
Landlord, the property management company for the Project or
any affiliate of the property management company to the extent
the costs of such services exceed the competitive rates in the
Geographical Market for such services (it being agreed that
the specific amounts set forth in this Lease which are paid to
such persons and/or entities are competitive rates in the
Geographical Market);
(17) The cost of utility installation and tap-in charges;
(18) leasing commissions, attorneys' fees, costs and
disbursements and other expenses incurred in connection with
leasing, renovating or improving space for tenants or
prospective tenants of the Project;
(19) allowances, concessions and other costs (including
permit, license and inspection fees) incurred in renovating or
otherwise improving or decorating, painting or redecorating
space for tenants or vacant space;
(20) Landlord's costs of any services sold to tenants for
which Landlord is entitled to be reimbursed by such tenants as
an additional charge or rental over and above the basic rental
and operating expenses payable under the lease with such
tenant or other occupant;
(21) Costs incurred due to violation by Landlord or its agents
or employees of any of the terms and conditions of this Lease
or any other lease relating to the Project;
(22) Attorneys' fees, costs, disbursements and other expenses
incurred in connection with, or similar costs incurred in
connection with disputes with tenants, other occupants, or
prospective tenants, or similar costs and expenses incurred in
connection with negotiations or disputes with consultants,
management agents, purchasers or mortgagees of the Project
(however, such costs and expenses related to negotiations or
disputes with consultants related to the management and/or
operation of the Building shall be included within Operating
Expenses);
(23) Costs incurred (less costs of recovery) for any items to
the extent covered by a manufacturer's, materialman's,
vendor's or contractor's warranty (a "Warranty") which are
paid by such manufacturer, materialman, vendor or contractor
(Landlord shall pursue a breach of warranty claim for items
covered by a Warranty unless Landlord determines in good faith
that such action would not be in the best interest of the
tenants of the Project);
(24) Rental payments made under any ground or underlying lease
or leases, except to the extent that a portion of such rental
payments is expressly for ad valorem/real estate taxes or
insurance premiums on the Project;
(25) Costs incurred in connection with the sale, financing,
refinancing, mortgaging, selling or change of ownership of the
Project, including brokerage commissions, attorneys' and
accountants' fees, closing costs, title insurance premiums,
transfer taxes and interest charges;
(26) Costs, fines, interest, penalties, legal fees or costs of
litigation incurred due to the late payments of taxes, utility
bills and other costs incurred by Landlord's failure to make
such payments when due;
(27) Costs which are to be capitalized in accordance with
generally accepted accounting principles not included under
subsection (h) above;
(28) Costs and expenses of all electricity for the Project and
the costs and expenses of all other utilities directly metered
to tenants of the Project and payable
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separately by such tenants and costs of additional electrical
equipment installed in premises of other tenants of the
Project, and the costs of heating, ventilating and
air-conditioning services provided to other tenants of the
Project during hours other than Building Operating Hours
(defined below), whether or not such costs are payable by such
other tenants;
(29) Advertising, marketing, or promotional costs associated
with the Project;
(30) Costs or expenses relating to another tenant's or
occupant's space that were (i) incurred in rendering any
service or benefit to such tenant that Landlord was not
required, or were for a service in excess of the service that
Landlord was required, to provide Tenant hereunder, or (ii)
otherwise in excess of the Building Standard Services (defined
in Section 7.01 below) then being provided by Landlord to all
tenants of the Project on a uniform basis, whether or not such
other tenant is actually charged therefor by Landlord;
(31) Costs incurred to correct violations by Landlord of any
laws or amendment thereto in effect prior to the Commencement
Date;
(32) The costs of acquiring, insuring (to the extent only that
such items must be separately scheduled), or maintaining
(including any special cleaning or security, but only to the
extent such maintenance or security is in excess of Building
Standard Services) art work located in the Project (whether
permanently or temporarily);
(33) Costs incurred by Landlord to monitor, encapsulate or
remove any asbestos, polychlorinated biphenyls or other
Environmental Pollutants (unless same are caused by the
Tenant-Related Parties, or any other party in contractual
privity with any of them);
(34) The cost of installing, operating and maintaining any
specialty service such as an observatory, broadcast
facilities, luncheon club, athletic or recreational club,
restaurant, delicatessen, hair salon or other retail use;
(35) The cost of any work or service performed for the benefit
of any improvements other than those comprising the Project;
(36) Any lease payments for rented equipment, the cost of
which equipment (1) would constitute a capital expenditure
under clause 27 above if the equipment were purchased, and (2)
would not qualify for inclusion under subsection (i) above;
(37) Increased insurance premiums to the extent caused by
Landlord's or any other tenant's hazardous acts;
(38) Charitable or political contributions; and
(39) All taxes, assessments, and governmental charges and fees
of whatsoever nature, whether now existing or subsequently
created, attributable to the Project or its occupancy or
operation, including, without limitation, (1) taxes and
assessments attributable to the personal property of other
tenants, (2) federal and state taxes on income, (3) death
taxes, (4) any taxes imposed in connection with any change in
ownership of the Building, (5) franchise taxes, and (6) any
taxes imposed or measured on or by the income of Landlord from
the operation of the Project, and including all such taxes
whether assessed to or paid by Landlord or third parties.
5.02B. TENANT'S ELECTRICITY CHARGE. Tenant covenants and agrees to pay
to Landlord as additional Rent without any setoff or deduction whatsoever except
as set forth in this Lease, Tenant's Pro Rata Share as set forth in Section
1.01(i) of all electricity consumed from and
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after the Commencement Date in the use, occupancy, and operation of the Project
(hereinafter called "Tenant's Electricity Charge"). The cost of electricity
consumed from the Effective Date through the Commencement Date shall be paid in
accordance with Exhibit "D-1". Landlord shall provide a monthly written itemized
xxxx to Tenant for Tenant's Electricity Charge throughout the Term and Tenant
shall pay same within thirty (30) days after receipt of each such xxxx. Landlord
shall xxxx Tenant for Tenant's Electricity Charge for the last month or portion
thereof of the Term of this Lease as soon as practicable after the termination
of this Lease and Tenant shall pay same within thirty (30) days after receipt of
such xxxx; the Tenant's obligation to pay such billing shall survive the
termination of this Lease. All payments for Tenant's Electricity Charge are to
be predicated upon separate and specific bills by Landlord and are not to be
included as part of the Base Rent payment required to be paid pursuant to
Section 1.01(j) hereof. Electrical power which is separately metered or is
otherwise separately assessable to tenants of the area served by such facilities
and the cost of normal and after hours air conditioning supplied to tenants of
the area so the area so served shall be excluded in computing Tenant's Pro Rata
Share of such costs as aforesaid. Landlord shall not be permitted to charge any
xxxx-up on electricity actual costs and Tenant shall be entitled to a credit
against Tenant's Electricity Charge in an amount equal to Tenant's Pro Rata
Share of any credit, rebate or reduction paid or provided to Landlord by the
electrical utility provider.
Notwithstanding anything to the contrary hereinbefore contained, if
Tenant elects to install meters measuring electricity used in all of the
Premises, Tenant shall pay the portion of Tenant's Electricity Charge relating
to the Premises directly to the utility company based on actual use as measured
by such meters in lieu of paying such portion of Tenant's Electricity Charge to
Landlord. Any meters installed by Tenant shall be installed at Tenant's cost and
expense (subject to such costs being paid by the Finish Allowance pursuant to
Exhibit "D-1").
5.03. PRORATION AND ADJUSTMENT OF OPERATING EXPENSES.
(a) If this Lease commences on other than the first day of a calendar
year, or if this Lease expires on other than the last day of a calendar year,
then the Operating Expenses for all of such calendar year shall be prorated
according to the portion of the Term that occurs during such calendar year. If
at any time the Building is not fully occupied or Landlord is not supplying all
services to all portions of the Building during an entire calendar year, then,
Base Operating Expense, Operating Expenses, the Actual Operating Expense
Increase and the Estimated Operating Expense Increase shall be adjusted as
though the Building had been one hundred percent (100%) occupied and Landlord
were supplying all services to all of the Building during the entire calendar
year.
(b) In no event is Tenant obligated to pay Additional Rent with respect
to calendar year 1999.
(c) Landlord shall use its reasonable efforts to make payments in a
time and manner to avoid late payment penalty charges and to obtain the
appropriate discounts to the extent such discounts are in the best interest of
the Project. Landlord shall operate the Project in an efficient manner designed
to minimize Operating Expenses consistent with maintaining services at a level
consistent with First Class Building Standards (defined below). Landlord agrees
to consult with Tenant, solicit its input, and consider Tenant's suggestions as
to how to minimize Operating Expenses.
(d) At Tenant's request, all supply and service contracts providing for
annual payments in excess of $10,000 will be competitively bid by independent
third parties each year.
(e) As used herein, "First Class Building Standards" shall mean a
quality that is equal to or in excess of the quality of first class office
projects (including associated parking facilities) located in the Geographical
Market.
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5.04. TAXES.
After calendar year 1999, Tenant shall be obligated to pay to Landlord
each calendar year during the Term (subject to adjustment of the Tax Stop
pursuant to Rider 1) the amount ("Tenant's Tax Obligation") by which (if any)
(a) Tenant's Pro Rata Share of all ad valorem taxes assessed against the Project
in such calendar year ("Premises Share of Taxes") exceeds (b) the product of Two
and 88/100 Dollars ($2.88) multiplied by the number of square feet of Rentable
Area comprising the Premises ("Tax Stop"), which Tenant's Tax Obligation shall
be paid as provided below.
Prior to the commencement of each calendar year during the Term after
calendar year 1999, Landlord shall furnish to Tenant a statement reflecting
Landlord's reasonable and good faith estimate of Tenant's Tax Obligation for
such calendar year ("Estimated Tenant's Tax Obligation"). Tenant shall pay to
Landlord prior to the first (1st) day of each calendar month during the Term
one-twelfth (1/12) of the Estimated Tenant's Tax Obligation for such calendar
year. Prior to ninety (90) days after the expiration of each calendar year
during the Term, Landlord shall furnish to Tenant a statement reflecting the
actual ad valorem taxes for such calendar year and the actual Tenant's Tax
Obligation for such calendar year (together with a copy of the tax bills from
the applicable taxing authorities). If the Estimated Tenant's Tax Obligation for
such calendar year is less than the actual Tenant's Tax Obligation, Tenant shall
pay the difference to Landlord within thirty (30) days of receipt of such
statement. If the Estimated Tenant's Tax Obligation is more than the actual
Tenant's Tax Obligation, Landlord shall refund such excess to Tenant with the
delivery of the statement to Tenant. Additionally, if the Premises Share of
Taxes is less than the Tax Stop, Landlord shall pay such difference to Tenant
simultaneously with delivery of the statement to Tenant. With respect to any
partial calendar year during the Term, Tenant's Tax Obligation hereunder shall
be prorated based on the number of days of such calendar year in the Term.
Landlord shall provide Tenant with copies of all tax assessments, appraisals and
notices received by Landlord from the taxing authorities within ten (10) days of
Landlord's receipt thereof.
Landlord agrees that Tenant shall receive the benefit of all rebates
which are made with respect to such taxes whenever such rebates are received,
even if received by Landlord after the applicable calendar year. Within ten (10)
days of Tenant's request, Landlord shall join Tenant in entering into any
tri-party agreements reasonably necessary in order to reduce the taxes on the
Project.
Landlord recognizes that Tenant may enter into a bi-party agreement
("Rebate Agreement") with a governmental entity pursuant to which such entity
will rebate directly to Tenant a portion of the taxes paid by Tenant under this
Lease. If Tenant enters into such Rebate Agreement, Landlord acknowledges that
Tenant shall receive the full benefit of such rebate, Landlord shall not be
entitled to any portion thereof and such rebate shall not affect Tenant's
obligations under this Section 5.04. Additionally, within ten (10) days of
Tenant's request, Landlord agrees to furnish each calendar year a letter to the
applicable governmental authority (in a form reasonably acceptable to Tenant)
which evidences that Tenant's obligations under this Lease for the payment of
Base Rent and Tenant's Tax Obligation result in Tenant effectively paying
Tenant's Pro Rata Share of all taxes assessed against the Project (as a portion
of the taxes are a component of the Base Rent), recognizing that such rebate
shall apply to taxes paid by Tenant pursuant to this Lease.
It is understood and agreed that if the present method of taxation
changes such that in lieu of the whole or any part of any ad valorem taxes
assessed against the Project, there is levied on Landlord a capital tax directly
on the rents received from the Project or another tax, assessment or charge
based in whole or in part upon such rents which is a substitute for such ad
valorem taxes , then all such taxes, assessments or charges, or the part thereof
so based, shall be deemed to be "ad valorem taxes assessed against the Project,"
as such term is used in this Section 5.04.
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ARTICLE 6.
=================
6.01. USE. Tenant shall use and occupy the Premises only for the
Permitted Uses set forth in Section 1.01(e) hereof, and for no other purposes.
Tenant shall not use or permit the Premises or any portion thereof to be used
for any purpose other than the Permitted Uses or for any unlawful purpose or in
any unlawful manner, and shall comply with the CCR and all federal, state, and
local governmental laws, ordinances, orders, rules and regulations applicable to
the Premises and the occupancy thereof (except to the extent Landlord is
responsible therefor pursuant to other provisions of this Lease) and Tenant
shall give prompt written notice to Landlord of any notification to Tenant of
any claimed violation thereof. Notwithstanding anything to the contrary
contained in this Lease, Landlord agrees that Tenant may enter into contracts or
subleases with third party vendors of Tenant's choice for the purpose of
operating any of the facilities referred to in the Permitted Uses in Section
1.01(e). Tenant shall not do or permit anything to be done in the Premises, nor
bring or keep anything therein which will in any way cause cancellation of any
insurance policy covering the Project or any part thereof or any of its
contents. In the event that, by reason of any acts of Tenant or any of the
Tenant-Related Parties or their conduct of business for other than the Permitted
Uses, there shall be any increase in the rate of insurance on the Building or
its contents, Tenant hereby agrees to pay such increase. Tenant shall not do
anything in or about the Premises and/or Project which will in any way obstruct
or unreasonably interfere with the rights of other tenants or occupants of the
Project. Tenant shall not permit any nuisance in, on or about the Premises.
Tenant shall not commit or suffer to be committed any waste in or upon the
Premises.
ARTICLE 7.
=================
7.01. LANDLORD'S SERVICES. Landlord shall, at Landlord's expense,
except as provided to the contrary in this Lease, furnish to Tenant the
following services ("Building Standard Services"), all of which Building
Standard Services shall comply with applicable laws, and the quality of such
services shall be equal to or in excess of First Class Building Standards:
(a) Central heat and air conditioning in season during Building
Operating Hours (defined below), so that the average indoor conditions
maintained in the Premises during Building Operating Hours shall be a minimum of
72(0)F dry bulb +/-2(0) in the winter when the outdoor temperature is not lower
than 22(0)F dry bulb and a maximum of 76(0)F dry bulb +/-2(0) in the summer when
the outdoor temperature is not higher than 99(0)F dry bulb, assuming sustained
peak loading conditions of one (1) person per 200 square feet of Rentable Area
and a combined light and power demand load of eight (8) xxxxx per square foot of
Rentable Area.
Landlord will furnish air conditioning, ventilating and heating for
full floor increments designated by Tenant at times other than Building
Operating Hours, in which event Tenant shall pay Landlord (i) the actual costs
for the provision of utilities, and (ii) during the Primary Term, $10.45 per
hour for the entire Premises (and not on a floor-by-floor basis). If Landlord
replaces obsolete HVAC equipment during the Term, then the hourly rate of $10.45
may be adjusted during the Extension Terms as agreed to by Landlord and Tenant
(with disputes relating thereto to be resolved by arbitration pursuant to
Section 17.29 hereof) to reflect current estimates of accelerated depreciation
of such equipment resulting from overtime usage. Tenant shall be provided with
means (via access cards or otherwise) to access air conditioning, ventilating
and heating outside of Building Operating Hours. Tenant shall be charged for a
minimum of two (2) hours of such after hours air conditioning, ventilating and
heating, even if Tenant has requested less than two (2) hours of such services.
The condenser water system will be made available to Tenant in the core
on each floor of the Premises as an alternate source of cooling for Tenant
installed HVAC units. Tenant shall not be charged for the use of such condensing
system water.
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As used herein, "Building Operating Hours" shall mean 7:00 a.m. through
7:00 p.m. on weekdays and 8:00 a.m. through 1:00 p.m. on Saturdays, exclusive of
Holidays.
As used herein, "Holidays" shall mean New Year's Day, Memorial Day,
Independence Day, Labor Day, Thanksgiving Day, and Christmas Day.
(b) Janitor service shall be provided to the Premises five (5) days per
week, exclusive of Holidays, consistent with the janitorial specifications set
forth in Exhibit "H"; provided, however, if Tenant's leasehold improvements
(including without limitation, floor coverings) require that Landlord provide
special or additional cleaning in excess of the janitorial specifications in
Exhibit "H" or if Tenant desires services not included in the janitorial
specifications, Tenant may either (1) independently contract with individuals or
entities that furnish such desired cleaning or other services, or (2) request
that Landlord cause such special or additional cleaning or other services to be
completed at Tenant's sole cost and expense. Landlord specifically reserves the
right to modify the janitorial services specifications set forth in Exhibit "H"
as in its reasonable judgment shall from time to time be required for the
safety, protection and cleanliness of the Project, the operation thereof, the
preservation of good order therein or the protection and comfort of the other
tenants of the Project and their agents, employees and guests (subject to
Tenant's approval, which approval shall not be unreasonably withheld). Landlord
agrees to make any changes to the janitorial specifications reasonably requested
by Tenant provided such changes are consistent with First Class Building
Standards.
In the event that the janitorial service being provided to the Premises
by Landlord consistently fails to conform with the specifications set forth in
Exhibit "H" or is otherwise unsatisfactory to Tenant, then Landlord shall
arrange a meeting between Tenant and the contractor providing the janitorial
services to the Premises within ten (10) days of Tenant's request so that any
problems with the janitorial services being provided to the Premises can be
addressed and remedied. If, within thirty (30) days after such meeting, the
janitorial services shall continue to fail to conform with the specifications
set forth in Exhibit "H" or remain unsatisfactory to Tenant in its reasonable
judgment, then the janitorial service contract shall be terminated in accordance
with its terms, and thereafter Tenant shall be entitled to participate in the
process by which Landlord solicits bids for the janitorial services contract,
and Tenant shall have the right to approve the contractor which is selected to
provide the janitorial services for the Premises. Landlord agrees that all
contracts for janitorial services shall contain a provision entitling Landlord
to terminate the contract without penalty with no more than ninety (90) days
prior notice.
(c) Twenty-four (24) hours per day, every day of the year, hot (i.e.,
thermostat set in the range of 105 to 110 Fahrenheit for comfort and energy
conservation purposes) and cold domestic water in restrooms, toilets, drinking
fountains and sinks in the Premises.
(d) Electric lighting service for the Parking Facilities, Common Areas
(including the ground floor lobby of the Building) of the Project and the public
areas of the Project at such times consistent with First Class Building
Standards, including, but not limited to, lighting of the Parking Garage in
accordance with First Class Building Standards twenty-four (24) hours a day,
every day of the year.
(e) A security system for the Project which will permit Tenant and its
employees access to the Premises twenty-four (24) hours per day every day of the
year subject to reasonable rules and regulations promulgated by Landlord with
respect thereto (subject to Tenant's approval, which shall not be unreasonably
withheld).
Tenant shall, at its sole cost and expense, (x) locate Tenant's
security personnel within the Premises and at the Security Desk (defined below)
as Tenant shall determine desirable, and (y) install and operate such additional
security systems as it shall determine desirable for the purpose of limiting
access to or within the Premises subject to Landlord's approval, which shall not
be unreasonably withheld, and provided such systems are located solely within
the Premises, comply with applicable laws, are coordinated with any security
services which may be provided to the entire Project by Landlord and Landlord is
provided with access to the Premises (excluding
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Security Areas [defined below]). Landlord and Tenant agree to consult and
collaborate with one another to design and/or upgrade the Project security
system to accommodate the needs of Tenant. Additionally, Landlord agrees that
the operating terminal for the security system shall be located in the Premises
(and not the property management office) in a location secured with a lock and
Tenant shall have the sole key to such lock. Tenant and Landlord will cooperate
in establishing a system to permit the property manager to access the system
accompanied by a representative of Tenant. At Tenant's option, Tenant shall
either "cap" or remove any upgrades made to the original security system at
Tenant's request upon the expiration or termination of this Lease. Landlord
agrees that Tenant shall be permitted to install a security desk in the ground
floor lobby of the Building ("Security Desk") subject to Landlord's approval of
the design thereof (which shall not be unreasonably withheld) and Landlord shall
reimburse Tenant for the costs incurred by Tenant with respect thereto, not to
exceed $10,000.00, within thirty (30) days of receipt of an invoice therefor
from Tenant. The Security Desk may be staffed by Tenant or Tenant's contractor
twenty-four (24) hours a day, every day of the year, or such fewer hours as
Tenant deems reasonably necessary to provide the access control service desired
by Tenant under this subsection (e). On the first (1st) day of each month during
each Lease Year during the Term (subject to adjustment of the Security Amount
pursuant to Rider 1), Landlord shall pay to Tenant one-twelfth (1/12) of the sum
of $30,000, being the amount budgeted by Landlord per year for Landlord's
furnishing security personnel during the hours from 4:00 p.m. to 11:00 p.m.
Monday through Friday and 7:00 a.m. to 1:00 p.m. Saturday ("Security Amount").
In calculating the Base Operating Expense and Operating Expenses after 1999,
Landlord shall not include such budgeted amount therein.
NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, LANDLORD SHALL NOT BE
RESPONSIBLE OR LIABLE IN ANY MANNER FOR FAILURE OF ANY SUCH SECURITY PERSONNEL,
SERVICES, PROCEDURES OR EQUIPMENT TO PREVENT, CONTROL, OR APPREHEND ANYONE
SUSPECTED OF CAUSING PERSONAL INJURY OR DAMAGE IN, ON OR AROUND THE PROJECT
(EXCEPT TO THE EXTENT CAUSED BY LANDLORD'S GROSS NEGLIGENCE OR INTENTIONAL
TORTIOUS ACTS).
(f) Twenty-four (24) hours per day, every day of the year, sufficient dedicated
electrical capacity transformed to a panel box located in the core of each floor
of the Premises to operate (1) incandescent lights, typewriters, calculating
machines, photocopying machines, stand alone network computers and appropriate
dedicated lines, word processing equipment, personal computers,
telecommunications and other machines of similar low voltage electrical
consumption (120/208 volts), provided that the National Electrical Code ("NEC")
calculation for demand load for said low electrical voltage on each such floor
shall not exceed three (3) xxxxx per square foot of Rentable Area for the
Premises on each floor; and (2) fluorescent lighting and equipment of high
voltage electrical consumption (277/480 volts) provided that the total NEC
design demand load for said lighting shall not exceed two (2) xxxxx per square
foot of Rentable Area for the Premises on such floor (each such NEC design
demand load to be hereinafter referred to as the "Building Standard Rated
Electrical Design Load"). In addition to the foregoing, Landlord agrees that the
high voltage (277/480 volts, three phase) power available in the Building bus
duct at each floor on which the Premises are located will have a total
(inclusive of the above described Building Standard Rated Electrical Design
Load) capacity available to Tenant of at least eight (8) xxxxx per square foot
of Rentable Area contained on such floor.
Additionally, Tenant shall have the right to install an emergency
generator in the Project (or any replacement therefor) to provide emergency
power only to the Premises. Tenant shall be responsible for the costs (if any)
to connect the emergency generator to any portions of the Premises. The
emergency generator will be located in an area of the Building approved by
Landlord, which approval shall not be unreasonably withheld. Tenant shall
maintain the emergency generator at Tenant's sole cost and expense. At the
expiration or earlier termination of the Lease, the emergency generator shall
belong to Tenant and Tenant shall be permitted to remove it at Tenant's cost.
Tenant shall also promptly repair at Tenant's cost any damage to the Premises or
the Building caused by such removal. The cost and installation cost of the
emergency generator shall not be funded out of the Finish Allowance.
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Additionally, Tenant shall have the right, at Tenant's cost (subject to
Landlord's approval and to such costs being paid with the Finish Allowance
pursuant to Exhibit "D-1") to cause additional electrical power to be installed
to provide power to the Building from a separate electrical service feed.
If Tenant's electrical equipment and lighting require electrical
circuits, transformers or other additional equipment in the Premises in excess
of Tenant's pro rata share of the Project's electrical or HVAC systems as to the
Premises (which additional equipment shall be hereinafter referred to as the
"Additional Electrical Equipment"), Tenant may (at Tenant's cost [subject to
such costs being paid with the Finish Allowance pursuant to the provisions of
Exhibit "D-1"], including the cost to design, install, maintain and replace the
Additional Electrical Equipment) install the same. The method of design and
installation of any Additional Electrical Equipment required by Tenant shall be
subject to the prior written approval of Landlord (which approval shall not be
unreasonably withheld).
If any of Tenant's electrical equipment requires conditioned air in
excess of Building Standard air conditioning, the same shall be installed, or
the installation supervised by Landlord, on Tenant's behalf, and Tenant shall
pay all design and installation costs (subject to such costs being paid with the
Finish Allowance pursuant to the provisions of Exhibit "D-1") relating thereto.
The type, location and method of installation of any such air conditioning shall
be subject to Landlord's approval (which approval shall not be unreasonably
withheld). Tenant shall maintain such air conditioning equipment at Tenant's
sole cost and expense.
(g) Replacement of Building standard halogen and/or fluorescent light
bulbs and tubes and incandescent down light bulbs in the Parking Facilities and
the Common Area of the Project, landscaped areas on the Land and all other
public areas of the Project, and upon Tenant's request and at Tenant's sole cost
and expense (which shall be paid separately and not included in Operating
Expenses), Landlord will replace any and all light bulbs and tubes in the
Premises. Landlord shall charge Tenant not more than the amount paid by Landlord
for such bulbs and tubes.
(h) Non-exclusive elevator cab passenger service to the Premises shall
be provided twenty-four (24) hours per day every day of the year of sufficient
capacity to service the Premises, subject to temporary cessation for ordinary
repair and maintenance (but as to each floor of the Premises, such temporary
cessation for ordinary repair and maintenance shall not occur simultaneously for
all passenger cabs serving such floor), subject to reasonable security measures
or other means of controlling access imposed by Landlord after Building
Operating Hours and on Holidays, and during times when life safety systems
override normal operating systems.
(i) Subject to the provisions of this Lease, maintenance and cleaning
of the Building, Building Shell Improvements, Parking Facilities, Common Areas,
landscaped areas on the Land, and all other public areas of the Project.
(j) Shared access to and use of the loading dock for Tenant's loading,
unloading, delivery, and pick-up activities during Building Operating Hours
including the right to leave vehicles standing at the loading dock for enough
time to load or unload and pick up and deliver goods to and from the Premises,
subject, however, to reasonable rules and regulations as are promulgated by
Landlord from time to time (subject to Tenant's approval, which approval shall
not be unreasonably withheld). Tenant shall also have access to and use of the
loading dock for the purposes set forth above during non-Building Operating
Hours but only by contacting Landlord's or Tenant's security personnel, as
applicable, by telephone (which security personnel shall be available for such
purpose at all times and will respond promptly).
(k) Sanitary sewer service twenty-four (24) hours per day, every day of
the year, subject to temporary interruption for ordinary repair and maintenance
and emergencies.
(l) Trash removal from the Project at a designated location, and if
requested by Tenant, collection and removal of white paper and aluminum cans for
recycling.
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(m) At all times during Building Operating Hours, and subject to
reasonable prior notice at all other times, non-exclusive use of the Project
freight elevators to the Premises, subject to temporary cessation for ordinary
repair and maintenance, and during times when life safety systems override
normal Project operating systems. Landlord shall use reasonable efforts to
accommodate Tenant's scheduling needs.
(n) Cold domestic water for drinking fountains at one (1) location at
the Building core on each floor comprising the Premises.
(o) Access to the Premises twenty-four (24) hours a day every day of
the year.
(p) Any other services that may from time to time be reasonably
necessary to ensure that the maintenance and repair of the Project are in
accordance with First Class Building Standards.
7.02. INTENTIONALLY DELETED
7.03. INTERRUPTION OF SERVICES
(a) Landlord shall furnish Tenant with at least twenty-four (24) hours
prior written notice of any interruption in the Building Standard Services that
are scheduled by Landlord for repairs or maintenance, excluding repairs and
maintenance necessitated by an emergency. Landlord shall endeavor to provide
Tenant with at least seventy-two (72) hours prior written notice of such
non-emergency-based repairs or maintenance.
(b) Notwithstanding anything herein to the contrary, the obligations of
the Landlord to provide the services and utilities provided above shall be
subject to governmental regulation (e.g., rationing, temperature, control, etc.)
and any such regulation which requires Landlord to provide or not provide such
services or utilities other than as herein provided, shall not constitute a
default hereunder, but rather compliance with such regulation shall be deemed to
be compliance by Landlord hereunder.
(c) Except as expressly provided in this Lease to the contrary, failure
by Landlord to furnish the Building Standard Services, or any cessation thereof,
shall not render Landlord liable for damages to either person or property, nor
be construed as an eviction of Tenant, nor work an abatement of rent, nor
relieve Tenant from fulfillment of any covenant or agreement hereof. In addition
to the foregoing and except as otherwise provided in this Lease, should any of
the equipment or machinery, for any cause, fail to operate or function properly,
Tenant shall have no claim for a rebate of rent or for damages on account of an
interruption in services occasioned thereby or resulting therefrom so long as
Landlord uses reasonable efforts to promptly and diligently repair said
equipment or machinery and to restore said services.
Notwithstanding the foregoing, in the event that (1) all or any portion
of the Premises become reasonably impracticable for Tenant to use to conduct its
business because Landlord for any reason (except due to the causes in subsection
(b) above or as the result of Tenant's gross negligence or willful misconduct)
is unable or fails to provide any of the Building Standard Services, and (2)
such failure (a "Basic Services Failure") continues for a period in excess of
the lesser of (i) three (3) business days or (ii) the number of days following
such failure after which Landlord's business interruption insurance becomes
payable, Tenant shall receive a full abatement of Rent due under this Lease for
such portion of the Premises so affected from the date of the Basic Services
Failure until such portion of the Premises is again reasonably practicable for
Tenant to use to conduct its business. Additionally, in the event a Basic
Services Failure continues for a period of ninety (90) consecutive days or more
or more than ninety (90) days in any twelve (12) month period, and as a result
of such Basic Services Failure twenty-five percent (25%) of the Rentable Area of
the Premises becomes reasonably impracticable for Tenant to use to conduct its
business, Tenant, at its option, shall be entitled to terminate the Lease by
delivering written notice of termination to Landlord, in which event the Lease
shall terminate and neither Landlord nor Tenant shall be liable for any
obligations one to the other under this Lease accruing after such termination,
including without limitation, any obligations of Tenant for the payment of
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Base Rent and Additional Rent. Notwithstanding the foregoing, if the Basic
Services Failure is the result of a casualty to the Building covered by Section
10.01, the provisions of Section 10.01 shall apply to such Basic Services
Failure.
7.04. KEYS AND LOCKS. Prior to the Commencement Date, Landlord shall
furnish to Tenant seven hundred eighty (780) access cards necessary for Tenant's
employees to access the Building and the Premises. Additional access cards will
be furnished at a charge (which shall not exceed the actual cost thereof to
Landlord) by Landlord on an order signed by Tenant or Tenant's authorized
representative. All such access cards shall remain the property of Landlord.
Tenant shall be permitted to install additional locks or other access control
devices in the Premises provided Tenant furnishes Landlord with a duplicate set
of keys or a master key and/or access cards to all such locks other than those
locks securing Security Areas (defined in Article 12). Landlord shall be
relieved of all obligations under this Lease it cannot perform with respect to
Security Areas and to areas it should have been, but was not, provided a key
and/or access card and Tenant shall indemnify and defend and hold Landlord and
its agents harmless from and against all liability, claims, loss, cost, damage
or expense incurred by Landlord or its agents as a result thereof. In addition,
with respect to Security Areas and any areas for which Landlord should have
been, but was not, provided an access card, Landlord may, in an emergency
situation where in Landlord's good faith judgment immediate entry is required to
prevent or minimize personal injury, death or property damage, use force to gain
entry into such areas, and Landlord shall not be liable to Tenant for damages
resulting from such use of force and Tenant shall indemnify and defend and hold
Landlord and its agents harmless from and against all liability, claims, loss,
cost, damage or expense incurred by Landlord or its agents as a result thereof.
Upon termination of this Lease, Tenant shall surrender to Landlord all keys
and/or access cards to the Premises, and give to Landlord an explanation of the
combination of all locks for safes, safe cabinets and vault doors, if any, in
the Premises.
7.05. GRAPHICS AND BUILDING DIRECTORY.
(a) Tenant may install, with Landlord's prior approval of the method of
illumination, if any, and methods of installation or attachment, which approval
will not be unreasonably withheld, and at Tenant's sole cost and expense
(subject, however, to reimbursement as a portion of the Finish Allowance)
graphics desired by Tenant on the walls of elevator lobbies on all floors of the
Building and on the entrance doors to the Premises on all floors of the Building
and a sign in the main lobby of the Building in a location designated by Tenant
and subject to Landlord's approval which shall not be unreasonably withheld.
Notwithstanding the foregoing, except as specifically provided in this
subsection (a) or Section 7.06 below, in no event may Tenant install any
graphics that may be visible from the exterior of the Building.
(b) Tenant may install, and Landlord shall maintain to the extent so
installed, a Building directory computer terminal in the lobby of the Building
with a minimum capacity determined by Tenant which shall contain a computerized
listing of Tenant's name, certain officers, employees and departments of Tenant,
and such other information as Tenant shall reasonably require. Landlord shall
pay to Tenant the lesser of (i) $5,000 or (ii) the actual cost of the
acquisition and installation of such computer terminal within thirty (30) days
after Landlord's receipt of an invoice therefor from Tenant.
7.06. PROJECT NAME, IDENTITY AND SIGNS.
(a) The Project shall initially be named "i2 Place". After the
Commencement Date and upon furnishing at least thirty (30) days prior written
notice to Landlord, Tenant shall have the right to rename the Project from time
to time during the Term to a name selected by Tenant and approved by Landlord;
provided, however, in no event shall Tenant be permitted to change the name of
the Project more than one (1) time in any one (1) Lease Year. Tenant shall pay
all costs reasonably incurred in changing the Project Signs (defined below) as
the result of any changes to the Project name made by Tenant after the
Commencement Date. In no event shall Landlord refer to the Building or Project,
or authorize any third party to refer to the Building or Project, by any name
other than the name selected by Tenant and approved by Landlord pursuant to this
subsection (a).
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(b) The following exterior signs (collectively, the "Project Signs")
for the Project shall be installed and maintained by Landlord at Tenant's cost
and expense (subject, however, to reimbursement for the costs of the design,
acquisition and installation of such signage as a portion of the Finish
Allowance in accordance with Exhibit "D-1" and except as provided in clause (i)
below):
(i) Two (2) monument signs have been installed prior
to the Effective Date by Landlord on the Land in the location
shown on Exhibit "B-2" attached hereto at Landlord's cost and
expense (and the cost of such signs shall not be paid from the
Finish Allowance). Prior to the Commencement Date, Landlord
will cause the signs to identify Tenant, the name of the
Project determined pursuant to Section 7.06(a) above, the
address of the Project and the name of the Complex as shown on
Exhibit "L-2" and in accordance with the specifications on
Exhibit "L-1" and as otherwise agreed by Landlord and Tenant
(and Tenant shall pay for the cost of installing such names
except that Landlord shall pay for the cost of installing the
Complex name and the Project address). Landlord agrees that
Landlord shall not install the name of Landlord, any other
tenant of the Building, or other person or entity or
information on these signs.
(ii) Within sixty (60) days after delivery of signs
to Landlord, signage depicting Tenant's name and/or logo shall
be prominently located by Landlord at the top of the Building
on any two (2) faces of the Building selected by Tenant, the
exact location of such signs to be approved by Landlord, which
approval shall not be unreasonably withheld. The signage will
be designed by Tenant consistent with the parameters set forth
on Exhibit "L-1". Tenant shall pay for the reasonable cost of
removal of such signage and any repairs necessitated by such
removal upon the expiration or earlier termination of this
Lease. No part of such sign shall extend above the parapet of
the Building.
(iii) Tenant shall have the right to erect temporary
signs during the applicable option periods defined in
Paragraphs 1, 2 and 3 of the Development Agreement on the
sites for Buildings 2, 3 and 4 for the purpose of identifying
future premises of Tenant.
Except for the signage described in this Section 7.06, Landlord shall
not install or permit any other signs to be placed or allowed to remain on the
exterior of the Project, in the main floor lobbies of the Project, and/or on the
Land without Tenant's prior written consent, which consent may be withheld in
Tenant's sole discretion, other than (1) directional and traffic control signs,
or (2) signs required by legal requirements.
7.07. RISER SPACE. Tenant shall have the right to use riser space in
the core of the Building, at no cost to Tenant, for cabling communications
purposes.
7.08. FIBER OPTIC CABLE CARRIERS. Tenant acknowledges that Landlord is
negotiating a lease with Southwestern Xxxx Telephone Company ("SWB") to provide
fiber optic cable service to the Building. Tenant shall be allowed to select
additional fiber optic cable carriers that will service the Building provided
that the terms of the lease with such additional carriers shall be no more
favorable to such carriers than those of the SWB lease. So long as all
installation is coordinated with Landlord, such fiber optic carriers shall be
allowed to install dual feed fiber optic cabling to the Building. Landlord shall
not impose any charge to Tenant for the use of such fiber optics (however,
Tenant shall pay any amounts charged to Tenant by the fiber optic carriers
and/or Tenant's Pro Rata Share of any amount charged to Landlord by the fiber
optic carriers). Any additional conduits necessary to accommodate service by
such additional carriers shall be paid by Tenant.
7.09. COMMUNICATIONS EQUIPMENT. Tenant may, at Tenant's sole cost and
expense (except to the extent such costs are paid with the Finish Allowance as
provided in Exhibit "D-1") and without charge from Landlord, install, operate
and maintain antenna and satellite
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equipment ("Communications Equipment") on any portion of the roof area of the
Building as long as Landlord approves the manner of installation and screening
of the equipment (which approval shall not be unreasonably withheld). The
installation and operation of such equipment must be in compliance with the CCR
and all applicable laws, rules and regulations. Landlord shall not take any
actions that would in any way interfere with Tenant's use of the Communications
Equipment or the transmission or reception of signal. Landlord and its
representatives agree to cooperate reasonably with Tenant in connection with
obtaining any permit, license, zoning variance, special use permit or other
authorization. Landlord also will provide space at no expense to Tenant in the
core of the Building necessary to accommodate Tenant's conduit and other
requirements related to such Communications Equipment. Any assignee or sublessee
of this Lease or the Premises or a portion thereof shall have the right to use
such equipment. Tenant shall have the right to sublease the rights to use such
Communications Equipment to affiliates, subtenants, and assignees. Tenant shall
not install any Communications Equipment which would adversely affect or
compromise the structural integrity of the Building (or if so, Landlord may
construct reinforcements necessary to accommodate same at Tenant's cost and
expense). Tenant shall remove all such Communication Equipment upon the
expiration or earlier termination of this Lease and repair any damage caused by
such removal, all at Tenant's cost and expense. Landlord shall have the right to
enter into temporary agreements which allow third parties to install, operate
and maintain communications equipment on the roof of the Building provided that
at such time as the location of such third party equipment or the operation
thereof interferes with Tenant's Communications Equipment or if Tenant desires
to install additional Communications Equipment, Landlord shall upon request of
Tenant cause such temporary agreements to be terminated and the third party
communications equipment removed.
7.10. ADDITIONAL HVAC COMPRESSORS. With the prior written approval of
Landlord as to location (which approval shall not be unreasonably withheld) and
provided that same shall not adversely affect or compromise the structural
integrity of the Building, Tenant may, as part of the Tenant Improvements,
install, operate, maintain and repair additional HVAC compressors on the roof of
the Building or at such other location reasonably acceptable to Landlord (and
Landlord shall not charge Tenant rent therefor). At Tenant's option and to the
extent available, the cost of such compressors shall be paid out of the Finish
Allowance. Tenant shall pay all applicable utility charges with respect thereto.
Upon the expiration or earlier termination of the Lease, the HVAC compressors
shall belong to Tenant and Tenant shall be permitted to remove them. Tenant
shall promptly repair all damage caused by such removal, at Tenant's expense.
ARTICLE 8.
=================
8.01. ALTERATIONS. The construction and installation of Tenant
Improvements is governed by Exhibit "D-1". After the installation of the Tenant
Improvements pursuant to Exhibit "D-1", Tenant shall not make or allow to be
made any alterations, installations, additions, or improvements in or to the
Premises, without Landlord's prior written consent, which consent shall not be
unreasonably withheld. If Landlord fails to approve or disapprove any request
within ten (10) business days after receipt of all necessary information,
Landlord shall be deemed to have approved such alteration. Should Tenant desire
to perform any alterations which are significant enough to require plans, Tenant
shall submit such plans and specifications for same to Landlord for Landlord's
written approval before beginning such work. Upon receipt by Tenant of the
written approval of Landlord of such plans and specifications, and upon payment
by Tenant to Landlord of the reasonable out-of-pocket fees incurred by Landlord
to have such plans and specifications reviewed, Tenant may proceed to make such
approved alterations so long as they are in compliance with such approved plans
and specifications and are performed by a contractor approved by Landlord, which
consent shall not be unreasonably withheld. All installations shall be at
Tenant's sole cost and expense. Without in any way limiting Landlord's consent
rights, Landlord shall not be required to give its consent until (a) Landlord
approves the contractor or person making such and approves such contractor's
insurance coverage to be provided in connection with the work (such approval not
to be unreasonably withheld), (b) Landlord approves final and complete plans and
specifications for the work to the extent plans and specifications are necessary
for such work and (c) the appropriate governmental agency, if any, has approved
the plans and specifications for such work to the extent plans and
specifications are
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necessary for such work. All work performed by Tenant or its contractor relating
to the installations shall conform to applicable governmental laws, rules and
regulations, including, without limitation, the Disability Acts. If Tenant
requests that Landlord perform such installations, Tenant shall pay Landlord, as
additional Rent, the cost thereof, plus five percent (5%) as reimbursement for
Landlord's overhead; however, in no event shall such fee be payable with respect
to the installation of Tenant Improvements pursuant to Exhibit "D-1". Each
payment shall be made to Landlord within thirty (30) days after receipt of an
invoice from Landlord.
Notwithstanding anything to the contrary herein before contained, it
shall not be necessary for Tenant to secure Landlord's approval of any
alterations, improvements or additions to the Premises provided such alterations
cost less than $75,000, do not adversely affect the structure, HVAC system or
exterior of the building or the Common Areas, and are not visible from the
Common Area or the exterior of the Building. However, Tenant shall give Landlord
prior written notice of all alterations, regardless of whether Landlord has the
right to approve same.
All work performed by Tenant with respect to the Premises shall (a) be
performed so as not to alter the exterior appearance of the Building, (b) be
performed so as not to adversely affect the structure or safety of the Building,
(c) comply with all laws, including without limitation all building, safety,
fire, and other codes and governmental and insurance requirements, (d) be
completed promptly and in a good and workmanlike manner and in a quality not
less than Building Standard, (e) be performed at Tenant's expense, and (f) be
performed in such a manner that no valid mechanic's, materialman's, or other
similar liens (collectively, the "Liens") be attached to Tenant's leasehold
estate and in no event shall Tenant permit, or be authorized to permit, any
Liens (valid or alleged) or other claims to be asserted against Landlord or
Landlord's rights, estates, and interests with respect to the Project or this
Lease. Landlord will have the right, but not the obligation, to inspect
periodically the work in the Premises.
If any Lien is filed against the Premises or the Project or any portion
thereof, Tenant shall cause same to be discharged within forty-five (45) days
after the lien is filed by paying or bonding over said Lien. If Tenant fails to
comply with the foregoing sentence, Landlord shall (without limitation of its
other rights or remedies) have the right, but not the obligation, to discharge
said Lien and Tenant shall immediately reimburse Landlord for any sum of money
expended by Landlord in connection with obtaining such discharge (together with
an additional ten percent (10%) thereof to cover Landlord's administrative
costs), which amount shall be deemed to be Rent hereunder for all purposes.
Any approval by Landlord (or Landlord's architect and/or engineers) of
any of Tenant's contractors or Tenant's drawings, plans or specifications which
are prepared in connection with any construction of improvements (including
without limitation, the Tenant Improvements) in the Premises shall not in any
way be construed as or constitute a representation or warranty of Landlord as to
the abilities of the contractor or the adequacy or sufficiency of such drawings,
plans or specifications or the improvements to which they relate, for any use,
purpose or condition.
8.02. REMOVAL OF TRADE FIXTURES AND PERSONAL PROPERTY. Tenant agrees to
remove all of its trade fixtures and personal property, including without
limitation, all computers, generators, UPS power system, HVAC compressors,
cafeteria equipment, telephones, satellite dishes and related equipment and
cabling, on or before the date of expiration or termination of the Term. Upon
the expiration or termination of this Lease, Tenant shall have no obligation to
remove alterations, additions, or improvements or otherwise make any physical
improvements to the Premises unless Landlord's approval for the installation
thereof was conditioned upon such removal upon the expiration or termination of
the Lease; provided, however, Landlord shall not be permitted to require Tenant
to remove any Non-Removable Improvements or any other improvements other than
extraordinary improvements which will affect the leasability of the Premises
after the expiration of the Term (i.e., interior stairwells, emergency
generators, HVAC compressors on the roof, and communications equipment on the
roof). Additionally, Tenant shall not be required to remove, and shall not
remove, any of the
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following improvements: (1) wall and fixed partitioning (but not easily
removable shelving), (2) wallcoverings, (3) doors (including frame and
hardware), (4) floor coverings (other than area rugs), (5) Building Shell
Improvements, (6) ceiling and all elements thereof (including without limitation
ceiling grid and ceiling tile) and any improvements above the ceiling (excluding
computer, telephone or telecommunications cables; provided Tenant restores any
damage caused by the removal of such items, including damage to the ceiling),
(7) light fixtures (excluding chandeliers), (8) wall switches and outlets, (9)
exit lights, (10) telephone wall penetrations with pullstring, (11) blinds (but
not curtains), (12) automatic fire sprinkler system, (13) decorative molding,
and (14) any other improvements necessary for the Premises to be a functional,
integral unit ("Non-Removable Improvements"). Tenant shall have the right to
remove all improvements other than Non-Removable Improvements, including all
computer and telecommunications equipment and related items. Tenant shall repair
all damage done to the Premises or the Project by removal of any improvements by
Tenant (except to the extent caused by Landlord's negligence) and restore any
areas so affected by such removal so as to be consistent with surrounding areas.
If Tenant fails to deliver the Premises in the condition aforesaid, then
Landlord may restore the Premises to such a condition at Tenant's expense
including an overhead charge of ten percent (10%). All property not removed
within the time period required hereunder shall thereupon be conclusively
presumed to have been abandoned by Tenant and the same shall be the property of
Landlord.
8.03. REPAIRS BY LANDLORD. Landlord shall repair and maintain the Land,
the Building, the Parking Facilities, all utilities, the structural portions of
the Project, including the roofing system, exterior walls, support beams,
foundations, columns, exterior doors and windows and lateral support of the
Building, the Building Shell Improvements and all Building systems, the Building
service areas and other Common Areas, and all areas of the Project for the
common non-exclusive use of all tenants in the Project, in a first-class
condition comparable to the first-class buildings in the Geographical Market
(including all structural alternations required by law) except to the extent
such maintenance and repairs are caused by the act of Tenant, its agents,
servants or employees (subject to Section 9.03). Additionally, Landlord agrees
to exercise all remedies available to Landlord under the Declaration to cause
the Adjacent Land and Common Facilities to be maintained in accordance with
First Class Building Standards.
8.04. REPAIRS BY TENANT. Tenant shall, at Tenant's sole cost and
expense, keep the Premises (excluding any items Landlord is obligated to repair
and maintain in Section 8.03 or to the extent caused by the act of Landlord or
its agents, servants, contractors or employees) and any appliances therein in
good condition and repair, reasonable wear and tear excepted. Tenant shall, upon
the expiration or earlier termination of this Lease, surrender the Premises to
the Landlord in good condition, ordinary wear and tear and damage caused by
casualty condemnation or the actions of Landlord, its agents or employees
excepted. Subject to Section 9.03, any injury or damage to the Premises or
Project, or the appurtenances or fixtures thereof, caused by or resulting from
the act of Tenant or any of the Tenant-Related Parties shall be repaired or
replaced by Tenant. If Tenant fails to maintain the Premises or fails to repair
or replace any damage to the Premises or Project resulting from the act of
Tenant, or any of the Tenant-Related Parties, and such failure continues beyond
the cure periods provided in Section 15.01(b) below, Landlord may, but shall not
be obligated to, cause such maintenance, repair or replacement to be done, as
Landlord deems necessary, and Tenant shall immediately pay to Landlord all costs
related thereto, plus a charge for overhead of ten percent (10%) of such cost.
ARTICLE 9.
=================
9.01. LANDLORD'S INSURANCE. Landlord covenants and agrees that from and
after the date of delivery of the Premises from Landlord to Tenant, Landlord
will carry and maintain the insurance set forth in Section 9.01(a) and (b) of
this Article.
(a) General Comprehensive Public Liability Insurance insuring against
claims for personal or bodily injury or death or property damage occurring upon,
in or about the Project to afford protection to the limit of not less than
$5,000,000.00 combined single limit in respect to
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injury or death to any number of persons and property damage arising out of any
one (1) occurrence, with a reasonable deductible. Tenant shall be named as an
additional insured thereunder, and Landlord shall furnish Tenant a certificate
evidencing such coverage being in effect in substantially the following form:
"[Insert name of Tenant] is included as an additional insured but only as to
claims covered by the indemnity given Tenant by [Insert name of Landlord] in
Section 9.04 of the lease of premises at 00000 Xxxx Xxxx, Xxxxxx, Xxxxx dated
March ___, 1999."
(b) Landlord shall at all times during the term hereof maintain in
effect an all-risk policy (including coverage against fire, wind, tornado,
earthquake, vandalism, malicious mischief, flood, water damage and sprinkler
leakage) or policies covering the Project (excluding personal property of
Tenant, but including the leasehold improvements in the Premises) for the full
insurable value on a replacement cost basis with reasonable deductibles
customary for owners of first class buildings in the Geographical Market.
Any insurance provided for in Subsections 9.01(a) and (b) above may be
effected by a policy or policies of blanket insurance covering additional items
or locations or assureds, provided that the requirements of Sections 9.01(a) and
(b) are otherwise satisfied. Tenant shall have no rights in any policy or
policies maintained by Landlord.
9.02. TENANT'S INSURANCE. Tenant covenants and agrees that from and
after the date of delivery of the Premises from Landlord to Tenant, Tenant will
carry and maintain, at its sole cost and expense, the insurance set forth in
paragraphs (a) and (b) of this Section 9.02.
(a) General Comprehensive Public Liability Insurance against claims for
personal or bodily injury or death or property damage occurring upon, in or
about the Premises (including contractual indemnity and liability coverage),
such insurance to insure both Tenant and its employees and to afford protection
to the limit of not less than $5,000,000.00, combined single limit, in respect
to injury or death to any number of persons and all property damage arising out
of any one (1) occurrence, with a reasonable deductible. Landlord shall be named
as an additional insured thereunder, and Tenant shall furnish Landlord a
certificate evidencing such coverage being in effect in substantially the
following form: "[Insert name of Landlord] is included as an additional insured
but only as to claims covered by the indemnity given Landlord by [Insert name of
Tenant] in Section 9.04 of the Lease of the premises at 00000 Xxxx Xxxx, Xxxxxx,
Xxxxx dated March ___, 1999."
(b) Property insurance on an all-risk basis (including coverage against
fire, wind, tornado, vandalism, malicious mischief, water damage and sprinkler
leakage) covering all personal property of Tenant located in the Premises, in an
amount not less than one hundred percent (100%) of full replacement cost
thereof. Such policy will be written in the name of Tenant. The property
insurance may provide for a reasonable deductible.
(c) All such insurance in Sections 9.01 and 9.02 will be issued and
underwritten by companies which are respectable and financially sound. Tenant
shall deliver to Landlord and Landlord shall deliver to Tenant duly executed
originals of the certificates of all policies of insurance required by Sections
9.01 and 9.02 (as applicable) evidencing in-force coverage. Further, each party
shall deliver to the other renewals thereof at least thirty (30) days prior to
the expiration of the respective policy terms.
9.03. WAIVER OF RECOVERY. ANYTHING IN THIS LEASE TO THE CONTRARY
NOTWITHSTANDING, LANDLORD AND TENANT EACH HEREBY RELEASES THE OTHER, AND THE
OTHER'S PARTNERS, OFFICERS, DIRECTORS, AGENTS AND EMPLOYEES, FROM ANY AND ALL
LIABILITY AND RESPONSIBILITY TO THE RELEASING PARTY AND TO ANYONE CLAIMING BY OR
THROUGH IT OR UNDER IT, BY WAY OF SUBROGATION OR OTHERWISE, FOR ALL RIGHTS OF
RECOVERY, ACTIONS, CAUSES OF ACTION, COSTS, EXPENSES, CLAIMS, OR DEMANDS
WHATSOEVER WHICH ARISE OUT OF DAMAGE OR DESTRUCTION OF PROPERTY OCCASIONED BY
PERILS WHICH CAN BE INSURED BY AN ALL RISK PROPERTY INSURANCE COVERAGE FORM
INCLUDING COVERAGE FOR
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EARTHQUAKE AND FLOOD REGARDLESS OF THE AMOUNTS OF THE PROCEEDS PAYABLE UNDER
SUCH INSURANCE AND THE CAUSE OR ORIGIN, INCLUDING NEGLIGENCE OF THE OTHER PARTY
HERETO, OR ITS AGENTS, OFFICERS, PARTNERS, SHAREHOLDERS, SERVANTS OR EMPLOYEES.
LANDLORD AND TENANT GRANT THIS RELEASE ON BEHALF OF THEMSELVES AND THEIR
RESPECTIVE INSURANCE COMPANIES AND EACH REPRESENTS AND WARRANTS TO THE OTHER
THAT IT IS AUTHORIZED BY ITS RESPECTIVE INSURANCE COMPANY TO GRANT THE WAIVER OF
SUBROGATION CONTAINED IN THIS SECTION 9.03. THIS RELEASE AND WAIVER SHALL BE
BINDING UPON THE PARTIES WHETHER OR NOT INSURANCE COVERAGE IS IN FORCE AT THE
TIME OF THE LOSS OR DESTRUCTION OF PROPERTY REFERRED TO IN THIS SECTION 9.03.
9.04. INDEMNITY. Except as otherwise expressly provided in this Lease
to the contrary, Landlord shall not be liable to Tenant, or to Tenant's agents,
servants, employees, assignees, subtenants, licensees or concessionaires for any
damage to person or property caused by the negligence or intentional torts of
Tenant, or its agents, servants, employees, assignees, subtenants, licensees or
concessionaires, and Tenant agrees to indemnify and hold Landlord, and its
affiliates and their respective partners, officers, directors, shareholders,
employees and agents harmless from all liability and claims for any such damage.
Except as otherwise expressly provided in this Lease to the contrary, Tenant
shall not be liable to Landlord, or to Landlord's agents, servants or employees
for any damage to person or property caused by the negligence or intentional
torts of Landlord, or its agents, servants or employees, and Landlord agrees to
indemnify and hold Tenant, and its affiliates and their respective partners,
officers, directors, shareholders, employees and agents harmless from all
liability and claims for such damage.
ARTICLE 10.
================
10.01. CASUALTY. If the Project shall be damaged by fire or other
casualty and (i) the risk is covered by insurance carried or required to be
carried by Landlord hereunder (whether or not actually maintained by Landlord)
and the cost of repairing such damage shall not be greater than fifty percent
(50%) of the then full replacement cost thereof, or (ii) the damage results from
a risk not covered by insurance maintained or required to be maintained (whether
or not actually maintained by Landlord) pursuant to this Lease to an extent less
than twenty percent (20%) of the replacement cost of the Project, or (iii)
Tenant has the right to terminate this Lease as provided below and does not
terminate this Lease, then, subject to the following provisions of this Article,
Landlord shall repair the Project (including all leasehold improvements in the
Premises) to the condition prior to the casualty. If repairs are not commenced
within ninety (90) days of the casualty, diligently prosecuted thereafter, or
substantially completed within two hundred seventy (270) days after the
commencement of such repairs, Tenant may terminate this Lease by giving written
notice to Landlord or Tenant may restore and offset the costs of restoration,
plus interest at the Default Interest Rate, against Rent. The Rent required to
be paid hereunder shall be abated in proportion to the portions of the Premises,
if any, which are rendered untenantable by fire or other casualty hereunder
until repairs of the Project are completed, or if the Project are not repaired,
until the termination date hereunder. Notwithstanding the foregoing, if the
Project is damaged by fire or other casualty to an extent greater than twenty
percent (20%) of the then full replacement cost thereof resulting from an act of
war, then Landlord shall have the right to terminate this Lease by giving
written notice to Tenant. If Landlord fails to give Tenant such written notice
within thirty (30) days following the occurrence of such casualty, then Landlord
shall repair the Project as set forth above.
If the Project shall be damaged (a) by fire or other casualty not
covered by insurance maintained or required to be maintained (whether insured or
not) by this Lease to an extent greater than twenty percent (20%) of the
replacement cost of the Project, or (b) the damage results from a risk covered
by insurance maintained or required to be maintained by this Lease to an extent
greater than fifty percent (50%) of the then full replacement cost thereof, then
Tenant may terminate this Lease by giving written notice to Landlord; if Tenant
fails to deliver such notice within thirty (30) days following the occurrence of
such casualty, then Landlord shall
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diligently proceed to repair the Project (including all leasehold improvements
in the Premises) to the condition prior to the casualty, failing which Tenant
may terminate this Lease by delivering written notice thereof to Landlord or
Tenant may restore and offset the costs of restoration, plus interest at the
Default Interest Rate, against Rent.
If a casualty damages any portion of the Project which renders any
portion of the Premises reasonably impracticable for the conduct of Tenant's
business, and if, in the reasonable determination of Landlord which shall be
made within thirty (30) days following the date of the casualty, the damaged
property cannot be repaired so as to make the Premises tenantable within two
hundred seventy (270) days from the date of commencement of repairs, then Tenant
shall have the right to terminate this Lease by notifying Landlord in writing of
such termination within sixty (60) days of the casualty.
If this Lease is terminated as provided above, all Rent shall be
apportioned and paid up to the termination date. Landlord shall not be required
to repair or replace any personal property of Tenant.
10.02. END OF TERM CASUALTY. Notwithstanding anything to the contrary
in this Article 10, Landlord and Tenant shall have the right to terminate this
Lease if a casualty affecting greater than twenty percent (20%) of the Project
occurs during the last twelve (12) months of the Term (as it may have been
extended).
ARTICLE 11.
=================
11.01. CONDEMNATION.
(a) If all or substantially all of the Premises, or such portion of the
Premises or the Project as would render the continuance of Tenant's business
from the Premises impracticable, should be permanently taken or condemned for
any public purpose, then this Lease, at the option of Tenant upon the giving of
notice to Landlord within ten (10) days from the date of such condemnation or
taking, shall forthwith cease and terminate as provided in subsection (c) below.
(b) If all or substantially all of the Project, or so much thereof as
to cause the remainder not to be economically feasible to operate, as reasonably
determined by Landlord should be permanently taken or condemned for any public
purpose and Landlord demolishes the Project on account of such taking or
condemnation, then Landlord shall have the option of terminating this Lease by
notice to Tenant within ten (10) days from the date of such condemnation or
taking
(c) If this Lease is terminated as provided in subsections (a) or (b)
above, this Lease shall cease and expire as if the date of transfer of
possession of the Premises, the Project, or any portion thereof, was the
expiration date of this Lease.
If this Lease is not terminated by either Landlord or Tenant as
aforesaid, Tenant shall pay all Rent up to the date of transfer of possession of
such portion of the Premises so taken or condemned and this Lease shall
thereupon cease and terminate with respect to such portion of the Premises so
taken or condemned as if the date of transfer of possession of the Premises was
the expiration date of the Lease Term relating to such portion of the Premises.
Thereafter the Base Rent and Additional Rent shall be calculated based on the
Rentable Area of the Premises not so taken or condemned. If any such
condemnation or taking occurs and this Lease is not so terminated, Landlord
shall immediately after the date of such condemnation, commence to repair the
Premises or the Project, as the case may be, so that the remaining portion of
the Premises or Project, as the case may be, shall constitute a complete
architectural unit, and in the case of the Premises reasonably fit for Tenant's
occupancy and business as reasonably determined by Tenant and Landlord (with any
disagreement between Tenant and Landlord to be resolved by arbitration pursuant
to Section 17.29 hereof). If Landlord fails to commence such repairs within
sixty (60) days after the condemnation or cause such repair to the Premises to
be substantially completed
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within one hundred eighty (180) days after the date Landlord commences such
restoration work, then Tenant shall have the right to terminate this Lease by
notifying Landlord in writing of such termination.
(d) In the event of any condemnation or taking of the Premises, Tenant,
or anyone claiming under it, at its expense may, jointly with Landlord, appear,
claim and prove, in proceedings relative to such taking, (i) the value of any
fixtures, furniture, furnishings, leasehold improvements and other personal
property that were condemned but which under the terms of this Lease Tenant is
permitted to remove at the end of the Lease Term, (ii) the unamortized cost of
leasehold improvements that are not so removable by Tenant at the end of the
Lease Term and that were installed solely at Tenant's expense (i.e., not paid by
Landlord or with allowances provided by Landlord), (iii) the loss of Tenant's
business as the result of such condemnation, and (iv) relocation and moving
expenses as the result of such condemnation.
ARTICLE 12.
===============
12.01. ACCESS. Tenant agrees that Landlord and its agents may enter the
Premises for the purpose of inspecting and making such repairs (structural or
otherwise), additions, improvements, changes or alterations to the Premises or
the Project as may be permitted or required under this Lease and to exhibit the
same to prospective purchasers and mortgagees or, during the last eighteen (18)
months of the Lease Term, prospective tenants. Landlord's entries in the
Premises shall be preceded by reasonable notice (except in the case of an
emergency) and shall not interfere with Tenant's use and occupancy of the
Premises for the Permitted Uses. Except for emergency repairs, Landlord will
make all repairs in the Premises that could materially interfere with Tenant's
use and enjoyment of the Premises after Building Operating Hours. With respect
to any of the aforementioned entries by Landlord into and upon any part of the
Premises other than for emergencies, Tenant shall be entitled to have a
representative accompany Landlord. Notwithstanding any of the foregoing, unless
otherwise instructed by Tenant in writing, Landlord shall not enter areas
designated by Tenant as high security areas (the "Security Areas") (provided
Tenant has furnished Landlord with prior written notice of the location of the
Security Areas) unless (a) Landlord shows reasonable cause and provides
twenty-four (24) hours advance notice, or (b) an emergency situation exists in
respect of which emergency situation the provisions of Section 7.02 shall apply.
To the extent that Landlord's access to any portion of the Premises (including
without limitation the Security Areas) is restricted or limited by Tenant,
Landlord shall be relieved of its obligations to perform those covenants that
require access to such space during the time Landlord is denied access to such
space and Landlord shall have no liability or responsibility to Tenant for any
occurrences in such space during the time Landlord is denied access to such
space unless caused by Landlord or its agents or employees. Tenant shall
indemnify and defend and hold Landlord and its agents harmless from and against
all liability, loss, cost, damage, claim or expense incurred by Landlord or its
agents in connection therewith. Landlord and its brokers shall have access to
the Premises upon reasonable advance notice to Tenant for the purpose of showing
same to prospective tenants of other property owned by Landlord in the Complex;
subject, however to the following restrictions: (1) Landlord and such brokers
must give Tenant at least 24 hours advance notice; (2) Landlord and such brokers
shall not have access to Security Areas or any other area Tenant believes
sensitive or confidential activities or materials are located; (3) Landlord must
identify the prospective tenants and Tenant shall not be required to give access
to any persons Tenant believes are competitors of Tenant's business; (4)
Landlord and such brokers cannot interfere with the conduct of Tenant's
business, (5) such access need not be granted to Landlord more than twice each
calendar month, and (6) Tenant shall have the right to require that a
representative of Tenant accompany Landlord, the brokers and the prospective
tenants.
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ARTICLE 13.
===============
13.01 SUBORDINATION. Provided that Landlord, Tenant and the Underlying
Party (defined below) execute a subordination, non-disturbance and attornment
agreement in recordable form reasonably acceptable to Tenant and the Underlying
Party (and Landlord and Tenant agree that the subordination, non-disturbance and
attornment agreement attached hereto as Exhibit "K" is reasonable and a
subordination, non-disturbance and attornment agreement which is substantively
the same as Exhibit "K" shall be reasonable) this Lease is and shall be subject
and subordinate to any and all ground or similar leases which may hereafter
affect the Project, all mortgages which may hereafter encumber or affect the
Project and to all renewals, modifications, consolidations, replacements and
extensions of any such leases and/or mortgages (the "Underlying Documents");
provided, however, that at the option of any Underlying Party, this Lease shall
be superior to the lease or mortgage of such Underlying Party. Tenant shall
execute promptly any subordination, non-disturbance and attornment agreement or
other appropriate certificate or instrument evidencing same reasonably
acceptable to Tenant that Landlord may request. In addition, as a part of any
non-disturbance agreement, the applicable Underlying Party must agree that the
provisions of this Lease governing the application of insurance proceeds and
condemnation awards shall be prior to such Underlying Party's ground lease or
security documents. As used in this Lease, the term "Underlying Party" shall
mean the holder of the Landlord's interest under any ground or similar lease
and/or the mortgagee or purchaser at foreclosure with respect to any mortgage.
Tenant agrees that any Underlying Party may unilaterally subordinate its
mortgage or lease to this Lease at any time by filing a notice of such
subordination in the Official Public Records of Real Property of the County
where the Building is located. Notwithstanding anything to the contrary
contained in this Lease, the Underlying Documents shall in all events be
subordinate to the terms of the Development Agreement. Without limiting the
foregoing, in the event of the termination of any ground or similar lease
affecting the Project or the enforcement by the trustee or the beneficiary under
any mortgage or deed of trust of remedies provided by law or such deed of trust,
Tenant's rights to terminate this Lease set forth in the Development Agreement
shall be binding upon any successor in interest (whether or not the events
giving rise to such termination occurred prior to or after such termination or
enforcement).
13.02. ATTORNMENT. Provided Landlord, Tenant and the Underlying Party
execute the non-disturbance agreement in Section 13.01, in the event of the
termination of any ground or similar lease affecting the Project or the
enforcement by the trustee or the beneficiary under any mortgage or deed of
trust of remedies provided by law or by such mortgage or deed of trust, Tenant
will automatically become the Tenant of such successor in interest without
change in the terms or other provisions of this Lease; provided, however, that
such successor in interest shall not be bound by (a) any payment of Rent for
more than one (1) month in advance, or (b) any amendment or modification of this
Lease made without the written consent of such trustee or such beneficiary or
such successor in interest of which Tenant has prior notice. Upon request by any
such successor in interest, Tenant shall execute and deliver within ten (10)
days of receipt an instrument or instruments confirming the attornment provided
for herein reasonably satisfactory to Tenant.
13.03. QUIET ENJOYMENT. Provided an event of Default by Tenant is not
in existence, Tenant shall and may peaceably and quietly enjoy the Premises for
the Term, subject to the provisions of this Lease and Landlord agrees to defend
such title to Tenant's interest in the Premises as to any person.
ARTICLE 14.
===============
14.01. ASSIGNMENT. Except as permitted in this Lease, Tenant shall not
assign or in any manner transfer this Lease or any estate or interest herein, or
sublet the Premises or any part thereof, or grant any license, concession or
other right of occupancy of any portion of the
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Premises without the prior written consent of Landlord, which shall not be
unreasonably withheld. If Tenant desires at any time to enter into an assignment
of this Lease or a sublease of the Premises or any portion thereof, Tenant shall
give written notice to Landlord of its desire to do so, which notice shall
contain (i) the name of the proposed assignee or subtenant, and (ii) the nature
of the proposed assignee's or subtenant's business to be carried on in the
Premises. Landlord shall give Tenant notice of either its consent or its denial
of consent to the proposed assignment or sublease within fifteen (15) days of
receipt of Tenant's request and information reasonably necessary to enable
Landlord to make an informed decision regarding its consent, failing which the
proposed sublease or assignment shall be deemed approved. Changes in ownership
of Tenant shall not be considered an assignment.
Tenant shall, despite any permitted assignment or sublease, remain
directly and primarily liable for the performance of all of the covenants,
duties, and obligations of Tenant hereunder and Landlord shall be permitted to
enforce the provisions of this Lease against Tenant or any assignee or sublessee
without demand upon or proceeding in any way against any other person; provided,
however, if Tenant assigns all of its interest under this Lease to an assignee
that is a Credit Assignee (defined below) as of the date of such assignment and
such assignee assumes all obligation under this Lease thereafter accruing,
Tenant shall be relieved of its obligations under this Lease accruing after such
assignment. As used herein, a "Credit Assignee" shall mean an assignee that as
of the date of such assignment has at least the minimum investment grade credit
rating of Xxxxx or Standard & Poor's.
Notwithstanding anything to the contrary contained herein, Tenant may,
without the prior written consent of Landlord, sublet the Premises or any part
thereof to an affiliate, parent or subsidiary of Tenant, or assign this lease to
an affiliate, parent or subsidiary of Tenant, or permit occupancy of any portion
of the Premises by an affiliate, parent or subsidiary of Tenant, but only so
long as such affiliate, parent or subsidiary, controls or is controlled by or is
under common control with Tenant. Any such assignee hereunder shall be subject
to the terms of Sections 1.01(e) and 6.01 hereof. For purposes, hereof "control"
shall mean the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of such entity, whether
through the ownership of voting securities or by contract or otherwise. In
addition, without the consent of Landlord, Tenant and any subsequent assignee
shall have the right to assign this lease or sublet the Premises to (i) any
corporate successor of Tenant by merger, dissolution, or otherwise, or (ii)
purchaser of substantially all of Tenant's assets.
If Tenant shall assign this Lease or sublet any part of the Premises
for consideration in excess of the sum of (A) pro-rata portion of the Rent
applicable to the space subject to the assignment or sublet, plus (B) the
reasonable out-of-pocket costs and expenses incurred by Tenant under or in
connection with such sublease or assignment (including without limitation, the
costs for (i) broker's commissions paid by Tenant with regard to the transfer,
(ii) reasonable legal fees with regard to the transfer, (iii) expenses of
finishing out or renovation of the space involved), (iv) expenses of marketing
and advertising, and (v) cash rental concessions, then Tenant shall pay to
Landlord as Additional Rent fifty percent (50%) of any such excess within thirty
(30) days of receipt, and Tenant shall be entitled to retain the remaining fifty
percent (50%) of such excess.
14.02. CONSENT. Consent by Landlord to a particular assignment or
sublease shall not be deemed a consent to any other or subsequent transaction.
If this Lease is assigned or if the Premises or any portion thereof are
subleased without the permission of Landlord, then Landlord may nevertheless
collect rent from the assignee or sublessee and apply the net amount collected
to the Rent payable hereunder, but no such transaction or collection of rent or
application thereof by Landlord shall be deemed a waiver of any provision hereof
or a release of Tenant from the performance by Tenant of its obligations
hereunder.
14.03. TRANSFER BY LANDLORD.
In the event of the transfer and assignment by Landlord of its interest
in this Lease and in the Project to a person expressly assuming Landlord's
obligations under this Lease accruing before and after the transfer, Landlord
shall thereby be released from any further obligations
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hereunder, and Tenant agrees to look solely to such successor in interest of the
Landlord for performance of such obligations. Any security given by Tenant to
secure performance of Tenant's obligations hereunder may be assigned and
transferred by Landlord to such successor in interest, and Landlord shall
thereby be discharged of any further obligation relating thereto from the date
of closing.
ARTICLE 15.
===============
15.01 DEFAULT BY TENANT. Each of the following shall constitute a
"Default" by Tenant:
(a) The failure of Tenant to pay the Base Rent, or any other
installment of Rent when due, and the continuance of such failure for a period
of ten (10) days after receipt of written notice thereof from Landlord;
provided, however, Landlord shall not be required to give such ten (10) day
notice, and Tenant shall not be entitled to same, more than two (2) times during
any calendar year, and any such subsequent failure during such calendar year
shall be a Default by Tenant upon the occurrence thereof without any notice
whatsoever to Tenant; or
(b) Tenant shall fail to fulfill or perform, in whole or in part, any
of its obligations under this Lease (other than the payment of Rent) and such
failure or non-performance shall continue for a period of thirty (30) days after
written notice thereof has been given by Landlord to Tenant, provided that if
such failure or non-performance cannot be cured within such thirty (30) day
period, such thirty (30) day period shall be extended so long as Tenant promptly
commences a cure and diligently prosecutes such cure to completion; or
(c) The entry of a decree or order by a court having jurisdiction
adjudging Tenant or any guarantor to be bankrupt or insolvent or approving as
properly filed a petition seeking reorganization of Tenant or guarantor under
the National Bankruptcy Act, or any other similar applicable Federal or State
law, or a decree or order of a court having jurisdiction for the appointment of
a receiver or liquidator or a trustee or assignee in bankruptcy or insolvency of
Tenant or Guarantor or its property or for the winding up or liquidation of its
affairs; or Tenant or guarantors shall institute proceedings to be adjudicated a
voluntary bankruptcy or shall consent to the filing of any bankruptcy,
reorganization, receivership or other proceeding against Tenant or guarantor, or
any such proceedings shall be instituted against Tenant or guarantor and the
same shall not be vacated within one hundred twenty (120) days after the same
are commenced; or
(d) Tenant shall make an assignment for the benefit of Tenant's
creditors or admit in writing Tenant's inability to pay the debts of Tenant
generally as they may become due.
15.02. RIGHTS UPON DEFAULT BY TENANT.
(a) This Lease and the Term and estate hereby granted and the demise
hereby made are subject to the limitation that if and whenever there shall occur
any event of Default, as enumerated above, Landlord may, at Landlord's option,
without any additional notice or demand whatsoever (any such notice and demand
being expressly waived by Tenant) and without judicial process, in addition to
any other remedy or right given hereunder or by law or equity, do any one or
more of the following:
(1) Terminate this Lease by written notice to Tenant
and draw upon the Letter of Credit called for in Section 4.03
of this Lease in accordance with the terms thereof, in which
event Tenant shall immediately surrender possession of the
Premises to Landlord;
(2) Terminate Tenant's right to possession of the
Premises under this Lease without terminating this Lease
itself, by written notice to Tenant and draw upon the Letter
of Credit called for in Section 4.03 of this Lease in
accordance with the terms thereof, in which event Tenant shall
immediately surrender possession of the Premises to Landlord;
or
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(3) Enter upon and take possession of the Premises in
accordance with applicable laws and expel or remove Tenant and
any other occupant therefrom and draw upon the Letter of
Credit called for in Section 4.03 of this Lease in accordance
with the terms thereof, with or without having terminated this
Lease.
(b) Any right of Tenant, through contract, statute or otherwise, to
receive notice of Landlord's intent to exercise any of Landlord's remedies
hereunder is hereby waived by Tenant. Any right of Tenant through contract,
statute, or otherwise to cure any Default before Landlord may exercise any of
its remedies hereunder is hereby waived by Tenant (however, Tenant does not
waive the cure periods in Section 15.01 above).
(c) In the event of any Default described in subsection (b) of Section
15.01, Landlord shall have the right to enter upon the Premises in accordance
with applicable laws 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, and Tenant further agrees that Landlord shall not be liable
for any damages resulting to Tenant from such action.
(d) It is hereby expressly stipulated by Landlord and Tenant that any
of the above listed actions including, without limitation, termination of this
Lease, termination of Tenant's right to possession, and re-entry by Landlord,
will not affect the obligations of Tenant for the unexpired Term of this Lease,
including the obligations to pay unaccrued monthly rentals and other charges
provided in this Lease for the remaining portion of the Term of the Lease.
(e) Exercise by Landlord of any one or more remedies hereunder granted
or otherwise available shall not be deemed to be an acceptance of surrender of
the Premises by Tenant, whether by agreement or by operation of law, it being
understood that such surrender can be effected only by the written agreement of
Landlord. No such alteration of locks or other security devices and no removal
or other exercise of dominion by Landlord over the property of Tenant or others
at the Premises shall be deemed unauthorized or constitute a conversion, Tenant
hereby consenting, after any event of Default, to the aforesaid exercise of
dominion over Tenant's property within the Premises. All claims for damages by
reason of such re-entry and/or repossession and/or alteration of locks or other
security devices in accordance with applicable laws are hereby waived, as are
all claims for damages by reason of any distress warrant, forcible detainer
proceedings, sequestration proceedings or other legal process.
Tenant agrees that any re-entry by Landlord may be pursuant to a
judgment obtained in forcible detainer proceedings or other legal proceedings or
without the necessity for any legal proceedings but in accordance with all
applicable laws, as Landlord may elect, and Landlord shall not be liable in
trespass or otherwise.
(f) In the event Landlord elects to terminate this Lease by reason of
an event of Default, then notwithstanding such termination, the Tenant shall be
liable for and shall pay to the Landlord, at the address specified in Section
1.01(a) above, the sum of all Rent accrued to the date of such termination,
plus, as damages, the reasonable cost of recovering and reletting the Premises
for its current use (not costs of renovating for a different use), and an amount
equal to the total of the Rent provided in this Lease for the remaining portion
of the Term of the Lease (had such Term not been terminated by Landlord prior to
the Expiration Date stated in Section 3.01), less the reasonable rental value of
the Premises for such period; such amount to be discounted to present value at
the rate of six percent (6%) per annum. In no event shall Tenant be liable for
concessions or allowances given a replacement tenant.
In the event Landlord elects to terminate this Lease by reason of an
event of Default, in lieu of exercising the right of Landlord under the
preceding paragraph, Landlord may instead hold Tenant liable for all Rent
accrued to the date of such termination, plus such Rent as would otherwise have
been required to be paid by Tenant to Landlord during the period following
termination of the Term measured from the date of such termination by Landlord
until the
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Expiration Date stated in Section 3.01 (had Landlord not elected to terminate
the Lease on account of such event of Default) diminished by any net sums
thereafter received by Landlord through reletting the Premises during said
period (after deducting reasonable expenses incurred by Landlord as provided in
Section 15.03 hereof). Actions to collect amounts due by Tenant as provided for
in this paragraph may be brought from time to time by Landlord during the
aforesaid period, on one or more occasions, without the necessity of Landlord's
waiting until expiration of such period; and in no event shall Tenant be
entitled to any excess of rent obtained by reletting over and above the Rent
provided for in this Lease. If Landlord elects to exercise the remedy prescribed
in this paragraph, this election shall in no way prejudice Landlord's right at
any time hereafter to cancel said election in favor of the remedy prescribed in
the foregoing paragraph.
(g) In the event that Landlord elects to repossess the Premises without
terminating this Lease, then Tenant shall be liable for and shall pay to
Landlord at the address specified in Section 1.01(a) above, all Rent accrued to
the date of such repossession, plus Rent required to be paid by Tenant to
Landlord during the remainder of the Term until the Expiration Date of the Term
as stated in Section 3.01, diminished by any net sums thereafter received by
Landlord through reletting the Premises during said period (after deducting
reasonable expenses incurred by Landlord as provided in Section 15.03). Actions
to collect amounts due by Tenant as provided in this paragraph may be brought
from time to time by Landlord during the aforesaid period, on one or more
occasions, without the necessity of Landlord's waiting until expiration of the
Term and in no event shall Tenant be entitled to any excess of any rent obtained
by reletting over and above the Rent provided for in this Lease.
(h) Landlord shall exercise reasonable efforts to mitigate its damages
arising from a Default of Tenant hereunder.
15.03. EXPENSE OF REPOSSESSION. It is further agreed that, in addition
to payments required pursuant to Section 15.02 above, Tenant shall compensate
Landlord for all expenses incurred by Landlord in repossession (including among
other expenses, the total amount of any increase in insurance premiums caused by
the vacancy of the Premises).
15.04. CUMULATIVE REMEDIES; WAIVER OR RELEASE. The remedies of Landlord
and Tenant under this Lease shall be deemed cumulative and not exclusive of each
other. No action, omission or commission by Landlord or Tenant, including
specifically, the failure to exercise any right, remedy or recourse, shall be
deemed a waiver or release of the same. A waiver or release shall exist and be
effective only as set forth in a written document executed by Landlord and
Tenant, and then only to the extent recited therein. A waiver or release with
reference to any one event shall not be construed as continuing as to, or as a
bar to, or as a waiver or a release of, any right, remedy or recourse as to any
other or subsequent event.
15.05. ATTORNEY'S FEES. In the event of any legal action or proceeding
brought by either party against the other arising out of this Lease, the
prevailing party shall be entitled to recover reasonable attorneys' fees and
costs incurred in such action (including, without limitation, all costs of
appeal) and such amount shall be included in any judgment rendered in such
proceeding.
15.06. FINANCIAL STATEMENTS. Each party warrants and represents that
all financial statements, operating statements or other financial data at any
time given to the other are, or will be, as of their respective dates, true and
correct in all material respects.
15.07. NEGATION OF LIEN FOR RENT. Landlord hereby expressly waives and
negates any and all contractual liens and security interests, statutory liens
and security interests or constitutional liens and security interests arising by
operation of law to which Landlord might now or hereafter be entitled on all
property of Tenant now or hereafter placed in or upon the Premises (except for
judgment liens that may hereafter arise in favor of Landlord). The waiver and
negation contained herein shall not waive, negate or otherwise affect any
unsecured claim Landlord may have.
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15.08. DEFAULT BY LANDLORD. If Landlord fails to perform or observe any
covenant, term, provision or condition of this Lease, and such default should
continue beyond a period of ten (10) days as to a monetary default or thirty
(30) days (or such longer period as is reasonably necessary to remedy such
non-monetary default, provided Landlord shall continuously and diligently pursue
such remedy at all times until such default is cured) as to a non-monetary
default, after in each instance written notice thereof is given by Tenant to
Landlord [and a copy of said notice is sent simultaneously therewith to any
party (including without limitation a mortgagee) entitled to receive notice
pursuant to Section 17.04 hereof (the "Notice Parties")] then, in any such event
Tenant shall have the right to (i) cure such default, and Landlord shall
reimburse Tenant for all reasonable sums expended in so curing said default
(which reimbursement Tenant may effect through the withholding of Rent), and/or
(ii) commence such actions at law or in equity to which Tenant may be entitled
(other than an action to terminate this Lease). Tenant shall be entitled to
offset against Base Rent (provided that such offset shall be limited to twenty
percent (20%) of any Base Rent installment), or to counterclaim for any amounts
owed to Tenant by Landlord pursuant to this Lease, plus interest thereon at the
Default Interest Rate, to the extent that such amounts remain unpaid.
Notwithstanding the foregoing, Tenant may offset against all Base Rent and other
Rent next coming due without limitation (and not just 20% thereof) (1) any
portion of the Finish Allowance not paid by Landlord to Tenant when due in
accordance with Exhibit "D-1", (2) any portion of the Security Amount not paid
by Landlord to Tenant when due in accordance with Section 7.01 (e), (3) any
portion of the sums owed to Tenant under Section 5.04 not paid when due, and/or
(4) any amounts determined to be Landlord's liability pursuant to Section 17.29
or in any judgment entered by a court and to which execution has not been stayed
(through appeal or bond), plus interest on all such sums in (1), (2), (3) and
(4) at the Default Interest Rate. Tenant agrees that the cure of any default by
any of the Notice Parties shall be deemed a cure by Landlord under this Lease.
The foregoing provisions shall not limit other remedies available to Tenant
under this Lease or at law or in equity.
ARTICLE 16.
==================
16.01. HAZARDOUS WASTE.
(a) The term "Environmental Law" shall mean any federal, state or local
statute, regulation or ordinance or any judicial or other governmental order
pertaining to the protection of health, safety or the environment. The term
"Hazardous Substance" shall mean any hazardous, toxic, infectious or radioactive
substance, waste and material as defined or listed by any Environmental Law and
shall include, without limitation, petroleum oil and its fractions.
(b) Tenant shall not cause or authorize any Hazardous Substance to be
spilled, leaked, disposed of or otherwise released on or under the Project.
Tenant may use and sell in the Project only those Hazardous Substances typically
used and sold in the prudent and safe operation of the business permitted by
Sections 1.01(e) and 6.01 of this Lease. Tenant may store such Hazardous
Substances in the Project, but only in quantities necessary to satisfy Tenant's
reasonably anticipated needs. Tenant shall comply with all Environmental Laws
and exercise the highest degree of care in the use, handling and storage of
Hazardous Substances and shall take all practicable measures to minimize the
quantity and toxicity of Hazardous Substances used, handled or stored on the
Premises.
(c) Tenant shall immediately notify Landlord upon becoming aware of the
following: (i) any spill, leak, disposal or other release of a Hazardous
Substance on, under or adjacent to the Premises; (ii) any notice or
communication from any governmental agency or any other person relating to any
Hazardous Substance on, under or adjacent to the Premises; or (iii) any
violation of any Environmental Law with respect to the Premises or Tenant's
activities on or in connection with the Premises.
(d) In the event of a spill, leak, disposal or other release of a
Hazardous Substance on or under the Premises caused by Tenant or any of the
Tenant-Related Parties, or the threat of the same, Tenant shall (i) immediately
undertake all emergency response necessary to contain,
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cleanup and remove the released Hazardous Substance, (ii) promptly undertake all
investigatory, remedial, removal and other response action necessary or
appropriate to ensure that any Hazardous Substances contamination is eliminated
as required by applicable Environmental Law, and (iii) provide Landlord copies
of all correspondence with any governmental agency regarding the release (or
threatened or suspected release) or the response action, a detailed report
documenting all such response action, and a certification that any contamination
has been eliminated. All such response action shall be performed, all such
reports shall be prepared and all such certifications shall be made by an
environmental consultant reasonably acceptable to Landlord.
(e) In the event of a spill, leak, disposal or other release of a
Hazardous Substance on or under the Premises caused by Landlord, or any of its
contractors, agents or employees or by Landlord's previous tenants of the
Premises, or the threat of the same, Landlord shall (i) immediately undertake
all emergency response necessary to contain, cleanup and remove the released
Hazardous Substance, (ii) promptly undertake all investigatory, remedial,
removal and other response action necessary or appropriate to ensure that any
Hazardous Substances contamination is eliminated as required by applicable
Environmental Law, and (iii) provide Tenant copies of all correspondence with
any governmental agency regarding the release (or threatened or suspected
release) or the response action, a detailed report documenting all such response
action, and a certification that any contamination has been eliminated. All such
response action shall be performed, all such reports shall be prepared and all
such certifications shall be made by an environmental consultant reasonably
acceptable to Tenant.
(f) Upon expiration of this Lease or sooner termination of this Lease
for any reason, Tenant shall remove all Hazardous Substances and facilities used
for the storage or handling of Hazardous Substances from the Premises and
restore the affected areas by repairing any damage caused by the installation or
removal of the facilities. Following such removal, Tenant shall certify in
writing to Landlord that all such removal is complete.
(g) Landlord represents and warrants to Tenant that to the best of
Landlord's actual knowledge, the Premises and Project do not presently contain
any Hazardous Substance. Additionally, Landlord agrees that Landlord shall not
cause or authorize any Hazardous Substance to be generated, treated, stored,
released or disposed of, or otherwise placed, deposited in or located on the
Premises or Project by Landlord or its agents, contractors or employees, and no
activity shall be taken by Landlord or its agents or employees on the Premises
or Project that would cause or contribute to (x) the Premises to become a
generation, treatment, storage or disposal facility within the meaning of, or
otherwise bring the Premises within the ambit of Environmental Law, (y) a
release or threatened release of toxic or hazardous wastes or substances,
pollutants or contaminants, from the Premises or Project within the meaning of,
or otherwise result in liability in connection with the Premises within the
ambit of Environmental Law, or (z) the discharge of pollutants or effluents into
any water source or system, the dredging or filling of any waters, or the
discharge into the air of any emissions, that would require a permit under
Environmental Law.
(h) Notwithstanding the provisions of Article 14 of this Lease, it
shall not be unreasonable for Landlord to withhold its consent to any
assignment, sublease or other transfer of Tenant's interest in this Lease if a
proposed transferee's anticipated use of the Premises involves the generation,
storage, use, sale, treatment, release or disposal of any Hazardous Substance
other than those typically used and sold in the prudent and safe operation of
the businesses permitted by Sections 1.01(e) and 6.01 of this Lease.
(i) Tenant shall indemnify, defend and hold harmless Landlord, its
employees and agents, any persons holding a security interest in the Premises,
and the respective successors and assigns of each of them from and against any
and all claims, demands, liabilities, damages, fines, losses, costs (including
without limitation the cost of any investigation, remedial, removal or other
response action required by Environmental Law) and expenses (including without
limitation reasonable attorneys' fees and expert fees in connection with any
trial, appeal, petition for review or administrative proceedings) arising out of
or in any way relating to the use, treatment, storage, generation, transport,
release, leak, spill, disposal or other handling of Hazardous Substances on
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the Premises by Tenant or any Tenant-Related Parties. Tenant's obligations under
this paragraph shall survive the expiration or termination of this Lease for any
reason. Landlord's rights under this paragraph are in addition to and not in
lieu of any other rights or remedies to which Landlord may be entitled under
this Lease or otherwise.
(j) Landlord shall indemnify, defend and hold harmless Tenant and its
employees and agents and the respective successors and assigns of each of them
from and against any and all claims, demands, liabilities, damages, fines,
losses, costs (including without limitation the cost of any investigation,
remedial, removal or other response action required by Environmental Law) and
expenses (including without limitation attorneys' fees and expert fees in
connection with any trial, appeal, petition for review or administrative
proceeding) arising out of or in any way relating to the actual or alleged use,
treatment, storage, generation, transport, release, leak, spill, disposal or
other handling of Hazardous Substances on the Premises by Landlord, or any of
its contractors, agents or employees or by Landlord's previous tenants of the
Premises. Landlord's obligations under this paragraph shall survive the
expiration or termination of this Lease for any reason. Tenant's rights under
this paragraph are in addition to and not in lieu of any other rights or
remedies to which Tenant may be entitled under this Agreement or otherwise.
(k) All representations, warranties and indemnities contained in this
Article 16 shall survive the termination of this Lease.
ARTICLE 17.
==================
17.01. SUBSTITUTE PREMISES. Deleted intentionally.
17.02. ESTOPPEL LETTERS. Within ten (10) business days after the
written request of either Landlord or Tenant, the other party will execute, from
time to time, either an estoppel certificate or a three-party agreement among
Landlord, Tenant and any third party certifying, to the best of such party's
knowledge and belief, to such facts (if true) as Landlord or Tenant, as the case
may be, or such third party, may reasonably require in connection with the
business dealings of the parties and the status of certain matters pertaining to
this Lease.
17.03. HOLDOVER.
Subject to the provisions of subsection (b) below, if Tenant shall
remain in possession of the Premises after the expiration or earlier termination
of this Lease, Tenant will be deemed to be a tenant at sufferance and shall be
subject to immediate eviction and removal and shall pay for each month or
partial month of holdover period as rent an amount equal to the greater of (i)
one hundred fifty percent (150%) of the then actual rental rate prevailing on
the date of such termination or expiration, or (ii) one hundred fifty percent
(150%) of the prevailing then actual market rental rate for the Premises on the
date of such expiration or termination. The remaining in possession by Tenant or
the acceptance by Landlord of the payment of said rent shall not be construed as
an extension or renewal of this Lease unless extended by Landlord pursuant to
the preceding sentence. Tenant shall indemnify Landlord against all claims for
damages by any other tenant to whom Landlord may have leased all or any part of
the Premises effective upon the termination of this Lease.
17.04. NOTICE. Any notice or communication required or permitted in
this Lease shall be given in writing, sent by (i) personal delivery, (ii)
expedited delivery service with proof of delivery, or (iii) United States
registered or certified mail, return receipt requested, addressed as provided in
Section 1.01(a) or to such other address or to the attention of such other
person as shall be designated from time to time in writing by the applicable
party and sent in accordance herewith. Any such notice or communication shall be
deemed to have been delivered, whether actually received or not, four (4)
business days following deposit in the US Mail, postage paid, certified or
return receipt requested at the address and in the manner provided herein, or
any such notice or communication shall have been deemed to have been given as of
the date so delivered and actually received at the address and in the manner
provided herein in the case of personal
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delivery. Either party shall have the right to change its address to which
notices shall thereafter be sent and the party to whose attention such notice
shall be directed by giving the other party notice thereof in accordance with
the provisions of this Section 17.04. Additionally, each of Landlord and Tenant
may designate up to four (4) additional addresses to which copies of all notices
shall be sent. Notwithstanding anything contained in this Section 17.04 to the
contrary, any notice regarding a party's change of address or designation of
additional addressees shall become effective only upon ten (10) days prior
notice thereof.
17.05. RULES AND REGULATIONS. Tenant, as well as any permitted assignee
or sublessee, will comply with Building Rules adopted by Landlord, which are set
forth in Exhibit "C" attached hereto and made a part hereof for all purposes.
Landlord shall have the right to change such Building Rules or to amend them in
any reasonable manner for the safety, care and cleanliness of the Project, and
the Premises, and for preservation of good order therein, subject to Tenant's
approval (which approval shall not be unreasonably withheld) all of which
changes and amendments will be sent by Landlord to Tenant in writing and shall
be thereafter binding upon, carried out and observed by Tenant. Tenant shall
exercise diligent efforts to cause compliance with such Building Rules by the
employees, servants, agents and invitees of Tenant. If the Building Rules and
the terms of this Lease conflict, the terms of this Lease shall control.
Landlord shall enforce the Building Rules in a uniform manner.
17.06. LANDLORD'S LIABILITY. If Tenant shall recover a money judgment
against Landlord, such judgment shall be satisfied only out of the right, title
and interest of Landlord in the Project and neither Landlord nor its partners,
directors, shareholders, agents or employees shall be liable for any deficiency,
it being agreed that Landlord shall never be personally liable for any such
judgment. Landlord's interest in the Project shall include all insurance
proceeds, condemnation awards, and sales and refinancing proceeds.
17.07. AMERICANS WITH DISABILITIES ACT AND TEXAS ARCHITECTURAL BARRIERS
ACT. Notwithstanding anything to the contrary contained in the Lease, Landlord
and Tenant agree that the responsibility for compliance with the Americans with
Disability Act of 1990 ("ADA") shall be allocated as follows: (i) Landlord shall
be responsible for compliance with the provisions of Title III of ADA for all
exterior and interior areas of the Building not included within the Premises and
for the restrooms in the Premises and all structural alternations necessary to
cause the Premises to comply with the ADA; (ii) Landlord shall be responsible
for the compliance with the provisions of Title III of ADA for any construction,
renovations, alterations and repairs made by Landlord, its agents or
contractors; (iii) Tenant shall be responsible for compliance with the
provisions of Title III of the ADA in the Premises for any construction,
renovations, alterations and repairs made within the Premises if such
construction, renovations and repairs are made by Tenant, its employees, agents
or contractors (except for the restrooms and any structural alternations in the
Premises, which are Landlord's responsibility under this Lease); and (iv) except
for the restrooms and any structural alterations, which are Landlord's
responsibility under this Lease, Tenant shall be responsible for causing the
interior of the Premises to comply with the provisions of Title III of the ADA.
17.08. AUTHORIZATION. If either party signs as a corporation, each of
the persons executing this Lease on behalf of such party represents and warrants
that it is a duly organized and existing corporation, that it has and is
qualified to do business in Texas, that the corporation has full right and
authority to enter into this Lease, and that all persons signing on behalf of
the corporation were authorized to do so by appropriate corporate actions. If
either party is a general partnership, limited partnership, trust, or other
legal entity, each individual executing this Lease on behalf of said entity
represents and warrants that he or she is duly authorized to execute this Lease
on behalf of such entity and in accordance with such entity's governing
instruments, and that this Lease is binding upon such entity. Upon either
party's request, the other party shall furnish such party with proper proof of
due authorization for its execution of this Lease.
17.09. BROKERS. Except as provided in that certain Professional
Services Fee Agreement dated January 30, 1999 (as amended by that certain letter
agreement dated March 11, 1999) by and between Landlord and the brokers in
Section 1.10(n) ("Brokers") pursuant to which Landlord has agreed to pay a real
estate brokerage fee upon the terms described therein, Tenant
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represents that it has not engaged, and owes no fee to, any other broker, agent
or similar party with respect to the transactions contemplated by this Lease.
Accordingly, Tenant agrees to indemnify and hold harmless Landlord from and with
respect to any other claims for a brokerage fee, finder's fee or similar payment
with respect to this Lease which is made by any party claiming by, through or
under Tenant (other than the Brokers). Similarly, Landlord agrees to indemnify
and hold harmless Tenant from and with respect to any claims for a brokerage
fee, finder's fee or similar payment with respect to this Lease which is made by
Brokers or any party claiming by, through or under Landlord.
17.10. MEMORANDUM OF LEASE. Tenant shall not record this Lease.
Notwithstanding the foregoing, Landlord and Tenant shall enter into the
Memorandum of Lease attached hereto as Exhibit "I" for the purpose of recording
the same, and Tenant may, at Tenant's expense, record the same.
17.11. PARKING. Exhibit "F" attached hereto sets forth the agreements
between Landlord and Tenant relating to the Parking Facilities.
17.12. TIME OF ESSENCE. Time is of the essence of this Lease and all of
its provisions in which performance is a factor.
17.13. ENTIRE AGREEMENT. This Lease, including the Exhibits and Riders
attached hereto (which Exhibits and Riders are hereby incorporated herein and
shall constitute a portion hereof)and the Development Agreement, contain the
entire agreements between Landlord and Tenant with respect to the subject
matters hereof. Landlord acknowledges that Tenant has certain rights in the
Development Agreement to terminate this Lease and the Development Agreement does
contain restrictions on sale or conveyance of the Project, which rights and
restrictions are binding on Landlord and any successors and assigns of Landlord.
17.14. AMENDMENT. Any agreement hereafter made between Landlord and
Tenant shall be ineffective to modify, release or otherwise affect this Lease,
in whole or in part, unless such agreement is in writing and signed by the party
to be bound thereby.
17.15. SEVERABILITY. If any term or provision of this Lease shall, to
any extent, be held invalid or unenforceable by a final judgment of a court of
competent jurisdiction, the remainder of this Lease shall not be affected
thereby.
17.16. SUCCESSORS. This Lease shall bind and inure to the benefit of
the respective heirs, legal representatives, successors, and assigns of the
parties hereto.
17.17. CAPTIONS. The captions in this Lease are inserted only as a
matter of convenience and for reference only and they in no way define, limit,
or describe the scope of this Lease or the intent of any provisions hereof.
17.18. NUMBER AND GENDER. All genders used in this Lease shall include
the other genders, the singular shall include the plural, and the plural shall
include the singular, whenever and as often as may be appropriate.
17.19. GOVERNING LAW. This Lease shall be governed by and construed in
accordance with the laws of the State of Texas.
17.20. CHANGES TO THE PROJECT. No material changes shall be made to the
location, configuration, layout or design of the Building, Common Areas, Parking
Facilities, the Premises or any aspect of the Project without Tenant's prior
written consent which shall not be unreasonably withheld, conditioned or delayed
(except as they relate to the Premises or as otherwise provided in Section
1.01(p), which may be withheld in Tenant's sole discretion)
17.21. NO PRESUMPTION AGAINST DRAFTER. Landlord and Tenant understand,
agree and acknowledge that: (i) this lease has been freely negotiated by both
parties; and (ii) that in any controversy, dispute, or contest over the meaning,
interpretation, validity, or enforceability
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of this lease or any of its terms or conditions, there shall be no inference,
presumption or conclusion drawn whatsoever against either party by virtue of
that party having drafted this lease or any portion thereof.
17.22. EXAMINATION OF LEASE. Submission by Landlord of this instrument
to Tenant for examination or signature does not constitute a reservation of or
option for lease. This Lease will be effective as a lease or otherwise only upon
execution by and delivery to both Landlord and Tenant.
17.23. DEFINED TERMS AND MARGINAL HEADINGS. The words "Landlord" and
"Tenant" as used herein shall include the plural as well as singular. If more
than one person is named as Tenant, the obligations of such persons are joint
and several. The headings and titles to the articles, sections and subsections
of this Lease are not a part of this Lease and shall have no effect upon the
construction or interpretation of any part of this Lease.
17.24. NO REPRESENTATIONS. Landlord and Landlord's agents have made no
warranties, representations or Promises (express or implied) with respect to the
Premises, the Building or any other part of the Property (including, without
limitation, the condition, use or suitability of the Premises, the Building or
the Property), except as herein expressly set forth and no rights, easements or
licenses are acquired by Tenant by implication or otherwise except as expressly
set forth in the provisions of this Lease.
17.25. IMPROVEMENTS ON ADJACENT LAND. In no event may any improvements
be located on the portion of Adjacent Land which is owned by Landlord or any
affiliate of Landlord closer to the Building or any subsequent building leased
by Tenant on the Adjacent Land than the improvements shown on the site plan
attached hereto as Exhibit "B-2".
17.26 SURVIVAL OF INDEMNITIES. Each indemnity agreement and hold
harmless agreement contained herein shall survive the expiration or termination
of this Lease with respect to events which occurred prior to such termination or
expiration of this Lease.
17.27. COMPETITORS OF TENANT. Except in the exercise of Landlord's
remedy to repossess the entire Premises upon the default of Tenant hereunder,
Landlord shall not lease or grant any rights to occupy any space in the Project
to any person or entity other than Tenant and the management company for the
Building which shall be permitted to lease only the management office (which may
only be used and occupied for such purpose). The foregoing does not limit
Tenant's rights under Section 14.01 of this Lease.
17.28. FIRST OFFER ON SALE.
(a) If at any time during the Term, Landlord desires to sell all or any
portion of the Project, Landlord shall notify Tenant in writing (the "Sale
Notice") of the terms upon which Landlord is willing to sell such portion of the
Project. Tenant shall thereupon have the prior right and option to purchase such
portion of the Project ("ROFO") at the price and on the terms and conditions
stated in the Sale Notice. Nothing contained herein shall prohibit Landlord from
having discussions with other prospective purchasers of such portion of the
Project. Tenant may exercise the ROFO by giving Landlord written notice thereof
(the "Exercise Notice") within fifteen (15) calendar days after the date of
receipt by Tenant of the Sale Notice.
(b) In the event Tenant effectively exercises its ROFO under Section
17.28(a) hereof, Tenant and Landlord shall, within twenty (20) business days
following Landlord's receipt of the Exercise Notice, execute a contract of sale
(the "Tenant Contract") at the same price and upon the same terms and conditions
as stated in the Sale Notice.
(c) Should Tenant fail to deliver the Exercise Notice pursuant to
Section 17.28(a) hereof, Tenant's ROFO shall be deemed waived, and Landlord
shall thereafter be entitled to sell such portion of the Project to any third
party upon the ROFO Terms (hereinafter defined). "ROFO Terms" shall mean terms
no less favorable to Landlord than the terms and conditions
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contained in the Sale Notice, however, the purchase price may be up to five
percent (5%) less than that set forth in the Sale Notice.
(d) Notwithstanding the provisions of subparagraph (c) hereof, if
Landlord does not subsequently enter into a contract of sale with a third party
on the ROFO Terms within two hundred seventy (270) days after the Sale Notice,
or consummate the sale of such portion of the Project to such third party upon
ROFO Terms within three hundred sixty (360) days after the Sale Notice, then
Landlord may not sell such portion of the Project unless it again offers such
portion of the Project to Tenant pursuant to this Section 17.28.
(e) Notwithstanding any other provision of this Section 17.28, Tenant's
ROFO shall not apply to any of the following transactions: (i) any sale or
transfer of all or any portion of the Project or any interest therein to any
affiliate of the Landlord; (ii) any sale or transfer in connection with
permanent or interim financing for the Project, including any sale/leaseback,
joint venture or other similar arrangement; and (iii) the granting of any
mortgage or other lien, or any conveyance with respect thereto by foreclosure,
deed in lieu of foreclosure or the like. Any of the above mentioned transactions
shall not terminate Tenant's ROFO, but such ROFO shall thereafter continue to
bind the transferee.
(f) Tenant's ROFO is not continuing in nature, and Landlord shall have
no obligation to re-offer to Tenant except as set forth in subparagraph (d)
above.
17.29 ARBITRATION.
(a) Either Landlord or Tenant may require that any dispute under this
Lease be submitted to arbitration pursuant to this Section 17.29. All
arbitrations shall occur at a location in Dallas, Texas chosen by the
arbitrators and shall be conducted pursuant to the Arbitration Rules for the
Real Estate Industry (effective on May 1, 1994, and as subsequently amended) of
the American Arbitration Association (or the successor organization, or if no
such successor organization exists, then from an organization composed of
persons of similar professional qualifications). To the extent the provisions of
this Section 17.29 vary from or are inconsistent with the Arbitration Rules for
the Real Estate Industry (effective on May 1, 1994, and as subsequently amended)
of the American Arbitration Association or any other arbitration tribunal, the
provisions of this Section 17.29 shall govern. All arbitrations will be governed
by the provisions of this Section 17.29, the Arbitration Rules for the Real
Estate Industry (effective on May 1, 1994, and as subsequently amended) of the
American Arbitration Association (to the extent not inconsistent with this
Section 17.29), and the laws of the State of Texas (to the extent not
inconsistent with any of the foregoing). The party desiring such arbitration
shall give notice to that effect to the other party and simultaneously therewith
also shall give notice to the director (the "Director") of the Dallas, Texas
regional office of the American Arbitration Association (or the successor
organization, or if no such successor organization exists, then from an
organization composed of persons of similar professional qualifications),
requesting such organization to select, as soon as possible but in any event
within the next thirty (30) days, three neutral arbitrators with, if reasonably
possible, recognized expertise in the subject matter of the arbitration. At the
request of either party, the arbitrators shall authorize the service of
subpoenas for the production of documents or attendance of witnesses. Within
thirty (30) days after their appointment, the arbitrators so chosen shall hold a
hearing at which each party may submit evidence, be heard and cross-examine
witnesses, with each party having at least ten (10) days' advance notice of the
hearing. The hearing shall be conducted such that each of Landlord and Tenant
shall have reasonably adequate time to present oral evidence or argument, but
either party may present whatever written evidence it deems appropriate prior to
the hearing (with copies of any such written evidence being sent to the other
party). In the event of the failure, refusal or inability of any arbitrator to
act, a new arbitrator shall be appointed in his stead, which appointment shall
be made in the same manner as hereinbefore provided. The decision of the
arbitrators so chosen shall be given within a period of thirty (30) days after
the conclusion of such hearing and shall be accompanied by conclusions of law
and findings of fact. The decision in which any two arbitrators so appointed and
acting hereunder concur shall in all cases be binding and conclusive upon the
parties and shall be the basis for a judgment entered in any court of competent
jurisdiction. The fees and expenses of arbitration under this Section 17.29
shall be
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apportioned to Landlord and Tenant in such a manner as decided by the
arbitrators. Landlord and Tenant may at any time by mutual written agreement
discontinue arbitration proceedings and themselves agree upon any such matter
submitted to arbitration.
(b) Notwithstanding anything to the contrary contained in subsection
(a) above, if the purpose of the arbitration is to determine the Extension
Rental Rate under Rider 1, then the provisions of Rider 1 shall apply.
17.30. EXTENSION AND ADDITIONAL RIGHTS AND OPTIONS. Deleted
Intentionally.
17.31 TAX PROTESTS. Tenant has no right to protest the real estate tax
rate assessed against the Project and/or the appraised value of the Project
determined by any appraisal review board or other taxing entity with authority
to determine tax rates and/or appraised values (each a "Taxing Authority").
Tenant hereby knowingly, voluntarily and intentionally waives and releases any
right, whether created by law or otherwise, to (a) file or otherwise protest
before any Taxing Authority any such rate or value determination even though
Landlord may elect not to file any such protest; (b) receive, or otherwise
require Landlord to deliver, a copy of any reappraisal notice received by
Landlord from any Taxing Authority; and (c) appeal any order of a Taxing
Authority which determines any such protest. The foregoing waiver and release
covers and includes any and all rights, remedies and recourse of Tenant, now or
at any time hereafter, under Section 41.413 and Section 42.015 of the Texas Tax
Code (as currently enacted or hereafter modified) together with any other or
further laws, rules or regulations covering the subject matter thereof. Tenant
acknowledges and agrees that the foregoing waiver and release was bargained for
by Landlord and Landlord would not have agreed to enter into this Lease in the
absence of this waiver and release. Notwithstanding any such waiver and release,
if Tenant files or otherwise appeals any such protest, then Tenant will be in
breach under this Lease.
Landlord shall have the exclusive right to protest the real
estate tax rate assessed against the Project and/or the appraised value of the
Project determined by any Taxing Authority. However, notwithstanding anything to
the contrary contained in this Lease, Landlord shall upon the request of Tenant
to do so from time to time, make such a protest. Landlord shall diligently
monitor the taxes assessed against the Project as well as the assessed valuation
thereof and shall seek such abatements or other tax benefits or relief for the
Project in the exercise of Landlord's prudent business judgment, subject to the
rights of Tenant under the preceding sentence. Nothing contained herein shall
restrict Tenant from negotiating with tax authorities to effect tax savings on
property owned by Tenant or tax rebates with respect to the Project.
17.32 CONSENTS. Except as stated to the contrary elsewhere in this
Lease, in every instance in which either Landlord or Tenant is required to give
its consent or approval, such consent or approval shall not be unreasonably
withheld or delayed.
17.33 CCR AMENDMENTS. So long as Landlord or an affiliate of Landlord
is Declarant under the CCR, and so long as Tenant either retains or has
exercised its option to rent Building 2, Landlord shall not, without Tenant's
prior written consent, vote for an action or an amendment to the CCR or
authorize or take action (or if Landlord or an affiliate of Landlord is no
longer Declarant under the CCR, vote for an action or an amendment to the CCR)
under the CCR which will result in:
(a) An increase in Quarterly Assessments or Special
Assessments passed through to Tenant as an Operating Expense Increase
resulting from:
(i) Increase in the size in land area of the
Common Facilities.
(ii) A change in method of allocation of
assessments resulting from a modification of
the CCR.
(b) A material degradation of the appearance, usefulness or
First Class Building Standards of the Common Facilities.
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(c) an increase in the Quarterly Assessments passed through to
Tenant as an Operating Expense Increase in any calendar year by more
than ten percent (10%) of the Quarterly Assessments for the prior
calendar year resulting from construction of additional improvements or
modification of existing improvements within the Common Facilities
(except as may be required by governmental or judicial decision or
governmental law).
(d) the construction of any improvements between the Building
and the lake comprising a part of the Common Facilities.
Additionally, Landlord agrees to consult with Tenant in good faith
regarding all matters related to the CCR or Common Facilities. Further,
if Tenant requests that any particular Common Facilities be installed
from time to time, Landlord will consider such request in good faith.
Nothing contained in this Section 17.33 shall be construed so as to prevent
Declarant from initiating or supporting a modification of the Zoning Ordinance,
as defined in the CCR, to allow the development of attached residential and
mixed use commercial/residential buildings and/or retail/commercial free
standing buildings.
17.34 MANAGEMENT. Landlord agrees to consider in good faith (i) any
complaints of Tenant regarding the individual who is the on-site property
management representative and (ii) any request by the Tenant to replace such
individual. Landlord and Tenant shall establish a reasonably detailed protocol
between Tenant's facilities manager and the on-site property management
representative which protocol should include the office, home, fax and "beeper"
numbers for such people and additional people and telephone numbers to contact
in the event such managers are unavailable. Such protocol shall be updated upon
the request of either Landlord or Tenant.
17.35 DEFAULT INTEREST. All sums owed by Landlord to Tenant under this
Lease and not paid on or prior to the date due thereof shall bear interest from
the date due thereof until payment is received at a per annum rate (the "Default
Interest Rate") equal to the lesser of (i) the prime rate announced by Chase
Manhattan Bank, New York, New York, or its successor (the "Prime Rate"), from
time to time (or if the Prime Rate is discontinued, the rate announced as that
being charged to said bank's most creditworthy commercial borrowers) plus three
percent (3%), or (ii) the maximum contract interest rate per annum allowed by
law; provided, however, with respect to the first three (3) times per calendar
year that such sum is not paid on or prior to the date due by Landlord, no
interest shall be payable with respect to such late payments by such party
unless such payments are more than five (5) days late and then such past due
payments shall bear interest from the sixth (6th) day after the due date thereof
until payment is received.
17.36 VACATING THE PREMISES. If none of the Premises are occupied by
Tenant or its permitted assignee or sublessees (or any combination thereof)
after the Commencement Date (i.e., the Premise are 100% vacant) for longer than
180 consecutive days, even though Tenant continues to pay the stipulated Rent
and is not otherwise in default under this Lease, and Tenant or its permitted
assignee or subtenants (or any combination thereof) fails to re-occupy a portion
of the same (Tenant not being obligated to re-occupy all of the Premises) within
90 days after notice from Landlord (which notice may only be furnished by
Landlord after the expiration of the aforementioned 180 day period), then from
and after the expiration of said 90 day notice period Landlord may terminate
this Lease as to (and only as to) all of the Premises without declaring Tenant
in default under this Lease (and Section 15.01 shall not be applicable thereto),
by delivering written notice to Tenant. Space which is vacated on account of
bona fide remodeling or due to force majeure shall not be deemed unoccupied for
purposes of this Section 17.36.
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IN WITNESS WHEREOF, Landlord and Tenant have respectively executed this
Lease as of the day and year first above written.
LANDLORD: TENANT:
COLINAS CROSSING LP, i2 Technologies, Inc.,
a Delaware limited partnership a Delaware corporation
By: Xxxxxx X. Means Interests, Inc., By: /s/ X. X. Xxxxxxx
a Texas corporation, Name: X. X. Xxxxxxx
a general partner Title: Vice President
By: /s/ Xxxxxx X. Means
Name: Xxxxxx X. Means
Title: President
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