MASTER COMMERCIAL LEASE AGREEMENT
THIS MASTER COMMERCIAL LEASE AGREEMENT (the "Lease"), made and entered into
as of the 29th day of August, 1996, by and between IPOP MANAGEMENT, INC., a
Delaware corporation ("Landlord") and INPUT/OUTPUT, INC., a Delaware corporation
("Tenant").
W I T N E S S E T H:
Subject to the terms, provisions, and conditions of this Lease, and each in
consideration of the duties, covenants, and obligations of the other hereunder,
Landlord hereby leases, demises, and lets the Premises (as hereinafter defined)
to Tenant and Tenant hereby leases the Premises from Landlord.
ARTICLE I
DEFINITIONS
1.1 DEFINITIONS. For purposes of this Lease, the following terms shall
have the meanings respectively indicated:
"BANKRUPTCY EVENT" means the occurrence of one or more of the
following: (i) Tenant shall seek, consent to or not contest the appointment of
a receiver, trustee, or liquidator for itself or for all or any substantial part
of its property, (ii) Tenant shall voluntarily file a petition seeking relief
under the bankruptcy or other debtor relief laws of the United States in any
state or competent jurisdiction, (iii) Tenant shall make a general assignment
for the benefit of its creditors, (iv) an involuntary petition is filed against
Tenant seeking relief under the bankruptcy or other debtor relief laws of the
United States in any state or competent jurisdiction, or a court of competent
jurisdiction enters an order, judgment or decree appointing, without the consent
of Tenant, a receiver, trustee or liquidator for Tenant, or for all or any
substantial part of its property, and in either event, such petition, order,
judgment or decree shall not be and remain dismissed within a sixty (60) day
period after its filing or entry.
"BUILDINGS" means collectively the Office Buildings and the New
Building, together containing approximately 281,439 square feet of gross outside
area of office, manufacturing, warehouse and/or commercial space and the
associated parking lots and infrastructure serving same, located upon the Site.
"COMMENCEMENT DATE" means August 29, 1996.
"EXISTING LEASES" shall mean those certain existing Lease Agreements
between Landlord and the Existing Tenants with respect to space in the Office
Buildings, as more fully described on EXHIBIT B attached hereto and incorporated
herein for all purposes.
"EXISTING TENANTS" shall mean the tenants described in the Existing
Leases.
"FAIR MARKET VALUE OF THE MORTGAGED PROPERTY" has the meaning given to
such term in SECTION 19.4C.
"FIRST MORTGAGE" means that certain Deed of Trust and Security
Agreement dated August 29, 1996, executed by Landlord for the benefit of
Mortgagee, and covering the premises.
"MORTGAGEE" means The Variable Annuity Life Insurance Company, and its
successors and assigns, as the mortgagee under the First Mortgage.
"NEW BUILDING" means that certain 110,000 square foot manufacturing
office and warehouse facility being constructed and to be occupied by Tenant,
situated on Tract I described in EXHIBIT A attached hereto.
"PRE-FORECLOSURE DEBT" means the Indebtedness (as defined in the First
Mortgage) due and owing to Mortgagee immediately prior to any foreclosure of the
lien of the First Mortgage, including, but not limited to, the aggregate of the
outstanding principal balance of the Note (as defined in the First Mortgage),
the accrued interest and any other accrued but unpaid portion of the
Indebtedness and any and all costs, fees, expenses, attorney's fees and other
amounts due and owing and constituting part of the Indebtedness.
"PREMISES" means the Building and the Site.
OFFICE BUILDINGS" means these two (2) office buildings currently
occupied by Tenant and the Existing Tenants, under the Existing Leases, situated
on Tracts II and III described as EXHIBIT A attached hereto.
"SITE" means that certain real property situated in Fort Bend County,
Texas, more particularly described in EXHIBIT "A" attached hereto and
incorporated herein for all purposes, and all right, title, and interest of the
Landlord, if any, in and to any land lying in the bed of any street, road or
avenue, open or proposed, in front of or adjoining said land and in and to the
easements, franchises, rights, appendages and appurtenances.
"TERMINATION EVENT" occurs when Mortgagee forecloses the lien of the
First Mortgage and no Bankruptcy Event has occurred and is continuing.
"TERMINATION FEE" means the Termination Fee determined in accordance
with SECTION 19.4A OR B, as appropriate.
ARTICLE II
TERM
2.1 TERM. This Lease shall continue in force for a term (the "Term") of
120 months commencing on the 29th day of August, 1996, and ending on the 1st
day of September, 2006, unless sooner terminated or extended as herein provided.
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ARTICLE III
RENT
3.1 RENT. The rental (the "Rent") payable by Tenant during the Term shall
be TWO MILLION TWO HUNDRED THREE THOUSAND SIX HUNDRED SIXTY SEVEN AND 37/100
DOLLARS ($2,203,667.37) per year. The Rent shall be payable in advance in
monthly installments of ONE HUNDRED EIGHTY-THREE THOUSAND SIX HUNDRED THIRTY-
EIGHT AND 95/100 DOLLARS ($183,638.95) due on or before on the 20th day of each
calendar month during the Term, beginning on the Commencement Date. Rent shall
be payable at Landlord's address set forth in SECTION 23.1.
3.2 LATE CHARGE; DEFAULT RATE. In the event that Tenant shall fail to pay
any installment of Rent or Additional Rent (hereinafter defined) within ten (10)
days after the date on which such installment is due, Tenant shall pay to
Landlord a late charge equal to Five Hundred and no/100 Dollars ($500.00), in
order to compensate Landlord for the extra administrative expenses incurred.
Rent or Additional Rent that is more than five (5) days past due shall bear
interest at the lesser of the highest lawful rate or the prime rate in effect
from time to time announced by Texas Commerce Bank, National Association,
Houston, Texas, plus five percent (5%) per annum ("Default Rate"), until paid.
3.3 ADDITIONAL RENT. All sums, liabilities, obligations, and other
amounts which Tenant is required to pay or discharge pursuant to this Lease in
addition to the Rent, together with any interest, penalty, or other sum which
may be added for late payment thereof, shall constitute additional rent
hereunder ("Additional Rent"). In the event of any failure on the part of
Tenant to pay or discharge any of the foregoing, Landlord shall have all rights,
powers, and remedies provided for herein or by law or equity or otherwise in the
case of nonpayment of rent.
ARTICLE IV
CONDITION OF PREMISES
4.1 CONDITION OF THE PREMISES. THE PREMISES ARE DELIVERED TO TENANT AND
ARE BEING LEASED "AS IS" AND "WITH ALL FAULTS" AND TENANT ACKNOWLEDGES AND
AGREES THAT IT HAS BEEN GIVEN FULL OPPORTUNITY TO INSPECT THE CONDITION OF THE
PREMISES. TO THE MAXIMUM EXTENT PERMITTED BY LAW, LANDLORD HEREBY DISCLAIMS,
AND TENANT WAIVES THE BENEFIT OF, ANY AND ALL IMPLIED WARRANTIES, INCLUDING
IMPLIED WARRANTIES OF FITNESS OR SUITABILITY FOR PURPOSE, OR THAT THE PREMISES
HAVE BEEN CONSTRUCTED OR MAINTAINED IN A GOOD AND WORKMANLIKE MANNER. BY
OCCUPYING THE PREMISES AND TAKING POSSESSION THEREOF, TENANT ACCEPTS THE
PREMISES AS SUITABLE FOR THE PURPOSES FOR WHICH THEY ARE LEASED AND ACCEPTS THE
PREMISES AND EACH AND EVERY APPURTENANCE THEREOF, AND WAIVES ANY AND ALL DEFECTS
THEREIN. NOTWITHSTANDING THE ABOVE, TENANT ACKNOWLEDGES AND AGREES THAT THE
PORTION OF THE PREMISES CONSTITUTING THE NEW
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BUILDING IS STILL UNDER CONSTRUCTION AND TENANT WILL BE GIVEN THE OPPORTUNITY
TO INSPECT AND ACCEPT THE NEW BUILDING, BUT LANDLORD SHALL HAVE NO LIABILITY
TO TENANT WITH RESPECT TO THE CONDITION OF THE NEW BUILDING OTHER THAN AND TO
THE EXTENT OF ITEMS COVERED BY THE CONSTRUCTION CONTRACT AND ANY SUBCONTRACTS
FOR THE CONSTRUCTION OF THE NEW BUILDING.
ARTICLE V
USE
5.1 PRESCRIBED USE. Tenant shall use the Premises solely as office,
warehouse and manufacturing facilities.
5.2 LEGAL USE - VIOLATIONS OF INSURANCE COVERAGE. Tenant shall not occupy
or use, nor permit any portion of the Premises to be occupied or used, for any
business or purpose that is unlawful or deemed to be disreputable in any manner,
or extra hazardous on account of fire, nor permit anything to be done that will
increase the rate of fire insurance on the Premises, or its contents.
5.3 UPKEEP OF PREMISES AND ADJACENT AREAS. Tenant shall take good care of
the Premises and keep them in good repair and free from waste. Tenant shall
keep the Premises neat, clean and free from dirt, rubbish or other obstructions
at all times. Tenant shall store all trash and garbage within the appropriate
waste disposal areas and arrange for its regular pick-up or other regular
disposal at Tenant's expense.
ARTICLE VI
NET LEASE
6.1 NON-TERMINABILITY.
A. This Lease is an absolutely net lease and the Rent, Additional
Rent and all other sums payable hereunder by Tenant shall be paid without notice
(except as expressly provided herein), demand, set-off, counterclaim, abatement,
suspension, deduction or defense.
B. This Lease shall not terminate, nor shall Tenant have any right
to terminate this Lease (except as otherwise expressly provided herein), nor
shall Tenant be entitled to any abatement or reduction of Rent hereunder (except
as otherwise expressly provided herein), nor shall the obligations of Tenant
under this Lease be affected, by reason of (i) any damage to or destruction of
all or any part of the Premises from whatever cause, (ii) the taking of the
Premises or any portion thereof by condemnation, requisition or otherwise, (iii)
the prohibition, limitation or restriction of Tenant's use of all or any part of
the Premises, or any interference with such use, (iv) any eviction by superior
title or otherwise, (v) Tenant's acquisition or ownership of all or any part of
the Premises otherwise than as expressly provided herein, (vi) any default on
the part of Landlord under this Lease,
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or under any other agreement to which Landlord and Tenant may be parties,
(vii) the failure of Landlord to deliver possession of the Premises on the
commencement of the term hereof, or (viii) any other cause whether similar or
dissimilar to the foregoing, any present or future law to the contrary
notwithstanding. It is the intention of the parties hereto that the
obligations of Tenant hereunder shall be separate and independent covenants
and agreements, that the Rent, the Additional Rent and all other sums payable
by Tenant hereunder shall continue to be payable in all events and that the
obligations of Tenant hereunder shall continue unaffected unless the
requirement to pay or perform the same shall have been terminated pursuant to
any express provision of this Lease.
C. Except as expressly provided herein, Tenant agrees that it will
remain obligated under this Lease in accordance with its terms, and that it will
not take any action to terminate, rescind, or avoid this Lease, notwithstanding
(1) the bankruptcy, insolvency, reorganization, composition, readjustment,
liquidation, dissolution or winding-up or other like proceeding affecting
Landlord or its successor in interest, or (2) any action with respect to this
Lease which may be taken by any trustee or receiver of Landlord or its successor
in interest or by any court in any such proceeding.
D. Tenant waives all rights which may now or hereafter be conferred
by law (i) to quit, terminate or surrender this Lease or the Premises or any
part thereof, or (ii) to any abatement, suspension, deferment or reduction of
the Rent, Additional Rent or any other sums payable under this Lease, except as
otherwise expressly provided herein.
ARTICLE VII
TAXES, UTILITIES, MAINTENANCE
7.1 TAXES. Tenant shall pay, or at Landlord's option, reimburse Landlord
for the payment by Landlord of, all taxes, assessments, and other governmental
charges, whether federal, state, county or municipal, and whether they be by
taxing districts or authorities presently taxing the Premises or by others,
subsequently created or otherwise, and any other taxes and assessments levied or
assessed against the Premises (together, "Taxes"). If Tenant pays the Taxes
directly, Tenant shall pay all Taxes before the date they become delinquent and
shall provide to Landlord written tax receipts evidencing payment of the Taxes
at least ten (10) days prior to the date such Taxes become delinquent. If
Landlord elects to pay the Taxes and have Tenant reimburse Landlord for those
Taxes, Tenant shall pay to Landlord on the same day as installments of Rent are
due, as Additional Rent under this Lease, one-twelfth (1/12th) of the amount of
Taxes estimated by Landlord to become due with respect to the Premises for that
year. On or before January 31 of each year, Landlord shall either (a) submit an
statement to Tenant for the actual amount of Taxes due for the previous year,
LESS amounts already paid by Tenant, and Tenant shall pay such amount within
fifteen (15) days after receipt of such statement thereof, or (b) refund to
Tenant the difference, if any, of the Taxes paid by Tenant and the amount of
actual Taxes for that year.
7.2 UTILITIES. Tenant shall be responsible for and promptly pay all
charges incurred for all utility services to the Premises, including, but not
limited to, telephone
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service, sanitary sewer, water, natural gas, and electricity arising out of
Tenant's use, occupancy, and possession of the Premises. Tenant shall also
provide all replacement light bulbs and tubes and pay for all maintenance
upon utilities. In no event shall Landlord be liable for any interruption or
failure of utility service to the Premises.
7.3 MAINTENANCE, REPAIRS.
A. Subject to the provisions of ARTICLE XX below, relating to
destruction of or damage to the Premises, Tenant agrees that, at its own
expense, it will keep and maintain the Premises, including, without limitation,
the roof, exterior, foundation, structural, and operational parts, paving, and
landscaping, in a condition and repair similar to its condition and repair on
the Commencement Date hereof, reasonable wear and tear excepted. Tenant shall
be responsible for disposal of its trash from the Premises. Replacement and
repair parts, materials, and equipment shall be of quality equivalent to those
initially installed within the Premises and repair and maintenance work shall be
done in accordance with the then existing federal, state, and local laws,
regulations, and ordinances pertaining thereto. Upon any termination of this
Lease, Tenant shall surrender the Premises in a condition and repair similar to
its condition and repair on the commencement date hereof, reasonable wear and
tear excepted, and shall surrender all keys for the Premises to Landlord at the
place then fixed for the payment of rent.
B. Tenant covenants that in case of damage to or destruction of any
or all of the improvements upon the Premises by fire or any other cause, insured
or uninsured, Tenant will promptly, at its sole cost and expense, restore,
repair, replace or rebuild the improvements so damaged or destroyed as nearly as
practicable to the condition, quality and class thereof immediately prior to
such damage or destruction, or with such changes or alterations as Tenant shall
elect to make in conformity with ARTICLE XX of this Lease. In performing its
obligations under this paragraph, Tenant shall be entitled to insurance proceeds
under the terms and conditions set forth in ARTICLE XX hereof. Landlord shall
have the right to approve the plans and specifications for the work or repair,
replacement or rebuilding, such approval not to be unreasonably withheld or
delayed. Tenant shall diligently obtain all necessary permits for such work or
repair and shall maintain builder risk insurance in amounts reasonably
satisfactory to Landlord until completion of such work. Such restoration,
repairs, replacement or rebuilding shall be commenced promptly and prosecuted
with diligence, subject to unavoidable delays and force majeure.
7.4 TAXES ON TENANT'S PROPERTY. Tenant shall be liable for all taxes
levied or assessed against personal property, furniture, fixtures or other
improvements placed by Tenant in the Premises. If any such taxes for which
Tenant is liable are levied or assessed against Landlord or Landlord's property
and if Landlord elects to pay the same or if the assessed value of Landlord's
property is increased by inclusion of personal property, furniture, fixtures, or
other improvements placed by Tenant in the Premises, and Landlord elects to pay
the taxes based on such increase, then Tenant shall pay to Landlord on demand
that part of such taxes for which Tenant is liable under this Lease.
7.5 GOVERNMENTAL ORDERS; COVENANTS; LANDLORD CURE; PERMITTED CONTEST:
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A. Tenant shall, at its own cost and expense, promptly comply with
all applicable laws and with all applicable requirements of any legally
constituted public authority having jurisdiction over the Premises, with any
covenants or restrictions binding on the Premises and any contract, agreement or
other instrument applicable to the Premises and in effect on the date of
delivery hereof or to which Tenant is a party or has given its consent.
B. If Tenant fails to perform Tenant's obligations under any
paragraph of this Lease, Landlord may at its option after twenty (20) days
written notice (unless in Landlord's judgment its interest in the Premises may
be prejudiced by delay in which case notice shall be given to Tenant,
contemporaneously with the commencement of Landlord's performance), and unless
Tenant has bonded the obligations and is proceeding, diligently to perform the
same, perform such obligations on Tenant's behalf and the cost thereof, together
with interest thereon at the Default Rate shall become due and payable as
Additional Rent to Landlord on the next date scheduled for the payment of Rent.
C. Provided that Tenant first posts a bond, cash reserve or other
security reasonably acceptable to Landlord in an amount equal to the amount in
controversy, Tenant shall have the right to contest, by appropriate proceedings,
any tax, charge, levy, assessment, lien or other encumbrance, and/or any law,
rule, order, ordinance, regulation or other governmental requirement affecting
the Premises, and to postpone payment of or compliance with the same during the
pendency of such contest provided that in the event of such postponement or
payment or noncompliance: (i) Tenant shall not postpone the payment of any such
tax, charge, levy, assessment, lien or other encumbrance for such length of time
as shall permit the Premises, or any lien thereon created by such item being
contested, to be sold by federal, state, country or municipal authority for the
non-payment thereof; (ii) Tenant shall not postpone compliance with any such
law, rule, order, ordinance, regulation or other governmental requirements if
Landlord will thereby be subject to civil liability or criminal prosecution, or
if any municipal or other governmental authority shall commence a process
according to applicable law to carry out any work to comply with the same or to
foreclose or sell any lien affecting all or part of the Premises which shall
have arisen by reason of such postponement or failure of compliance; and (iii)
Tenant shall pay, in a timely fashion, all Rent and Additional Rent (other than
any item of Additional Rent that Tenant is permitted to contest pursuant to this
Lease, so long as Tenant satisfies all of the requirements of this Lease
relating to such contest) which shall become due and payable under this Lease.
ARTICLE VIII
INDEMNIFICATION
8.1 RELEASE OF CLAIMS. Tenant waives all claims against Landlord and its
agents and employees for injury to persons, damage to property or to any other
interest of Tenant sustained by Tenant or any person claiming through Tenant
resulting from any occurrence in or upon the Premises including, but not limited
to, such claims for damages resulting from: (a) any equipment or appurtenances
becoming out of repair; (b) the Premises being out of repair; (c) injury or
damage done or occasioned by wind, water, flooding,
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freezing, fire, explosion, earthquake, excessive heat or cold, vandalism,
riot or disorder or other casualty; (d) any defect in or failure of plumbing,
heating or air conditioning equipment, electric wiring or installation
thereof, gas, water, steam pipes, stairs, railings or walls; (e) broken
glass; (f) the backing up of any sewer pipe or downspout; (g) the bursting,
leaking or running of any tank, tub, washstand, water closet, water pipe,
drain, cooling coil or any other pipe or tank in, upon or about the Premises;
(h) the escape of steam or hot water; (i) water, snow or ice being upon or
coming through the roof, skylight, trapdoor, stairs, walks or any other place
upon or near the Premises or otherwise; (j) the falling of any fixture,
plaster or stucco; and (k) any act, omission, or negligence of occupants of
adjoining or contiguous buildings or of owners of adjacent or contiguous
property. Except as waived pursuant to SECTION 9.1 of this Lease, Tenant has
not and does not waive any claims, actions, losses, damages, or expenses
suffered by Tenant which are caused by the willful misconduct of Landlord,
its agents, employees, contractors, or invitees; provided, however, that the
provisions of SECTION 9.1 of this Lease shall, to the extent contrary to the
provisions of this sentence, control and supersede.
8.2 INDEMNIFICATION OF LANDLORD. Tenant hereby agrees to indemnify and
save Landlord harmless from and against any and all claims, actions, damages,
liabilities, and expenses in connection with the loss of life, personal injury,
and/or damage to property arising from or out of (a) any occurrence in, upon, or
at the Premises, however caused, including occurrences caused by the sole or
contributory negligence of Tenant, its agents, customers, invitees,
concessionaires, contractors, servants, vendors, materialmen, or suppliers;
(b) the occupancy, use, or misuse by Tenant, or Tenant's employees, of the
Premises, service areas, parking areas, pedestrian areas, pedestrian walks, or
driveways; (c) any occurrence on the Premises occasioned wholly or in part by
any act or omission of Tenant, its agents, customers, invitees, concessionaires,
contractors, servants, vendors, materialmen, or suppliers; or (d) any occurrence
occasioned by the violation of any law, regulation or ordinance by Tenant or its
agents, customers, invitees, concessionaires, contractors, servants, vendors,
materialmen, or suppliers; provided, however, that the provisions of this
indemnity shall not be applicable when such claims, actions, losses, damages, or
expenses are determined to have been caused by the willful misconduct of
Landlord, its agents, employees, contractors, or invitees. If Landlord is made
a party to any litigation commenced by or against Tenant for any of the above
reasons for which Tenant is obligated to indemnify Landlord, then Tenant shall
protect and hold Landlord harmless and pay all costs, penalties, charges,
damages, expenses, and reasonable attorneys' fees incurred or paid by Landlord.
The foregoing indemnity shall be in addition to Tenant's obligation to supply
the insurance as required by ARTICLE IX of this Lease and not in discharge of or
substitution for same.
ARTICLE IX
INSURANCE
9.1 WAIVER OF SUBROGATION. Tenant hereby waives and releases any and all
rights, claims, demands, and causes of action it may have against Landlord on
account of any loss or damage occasioned to Tenant, its properties, real and
personal, the Premises, or their contents, arising from any risk or peril
generally covered or coverable by standard
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fire and extended coverage insurance or covered or coverable by any insurance
policy carried by or available to Tenant; and Tenant, on behalf of the
insurance companies insuring the property of Tenant against any such loss,
waives and releases any rights of subrogation that such companies insuring
the property of Tenant against any such loss, may have against Landlord.
9.2 PUBLIC LIABILITY AND PROPERTY DAMAGE.
A. Tenant, at it's own cost and expense, shall maintain during the
Term general liability insurance relative to the Premises with limits as may be
required by a mortgagee of the Premises and until specifically required in a
lesser amount, in an amount of at least Twelve Million Five Hundred Fifty
Thousand and no/100 Dollars ($12,550,000.00) per occurrence, or such other
amount as may be required of Landlord under the Mortgage. Landlord and any
assignee or mortgagee of Landlord identified in writing to the insurer shall be
named as additional insureds and such policy shall provide that the same may not
be invalidated against Landlord or any assignee or mortgagee of Landlord,
including Mortgagee, by reason of any violation of a condition or a breach of
warranty of the policy or in the application thereof by Tenant, that the policy
may be canceled or materially altered or reduced in coverage by the insurer only
after thirty (30) days prior written notice to Landlord and any assignee or
mortgagee of Landlord, including Mortgagee, identified in writing to the
insurer, and that the insurer will give written notice to Landlord or any
assignee or mortgagee of Landlord identified in writing to the insurer in the
event of non-payment of any premium by Tenant when due. Said insurance may be
part of a bulk or general blanket insurance policy carried by Tenant and Tenant
shall not be required to obtain a separate policy relative to the Premises.
Tenant shall provide Landlord with a certificate of such insurance on an annual
basis.
B. Tenant, at its own cost and expense, shall maintain during the
Term an all risk hazard insurance policy with limits as may be required by a
mortgagee of the Premises, subject to standard exclusions but with vandalism and
malicious mischief endorsements, on all improvements to the Premises, including,
without limitation, the Buildings, improvements, alterations and additions which
are, or may become, a part thereof. Said insurance may be part of a bulk or
general blanket insurance policy covered by Tenant and Tenant shall not be
required to obtain a separate policy for such insurance. Landlord and any
assignee or mortgagee of Landlord, including Mortgagee, identified in writing to
the insurer shall be named as an additional insured. The payment of loss
relative to the Premises shall be payable as provided for in Paragraph 20.1.
Such policy shall provide that the policy may not be invalidated against
Landlord or any assignee or mortgagee of Landlord, including Mortgagee,
identified to the insurer by reason of any violation of a condition or a breach
of warranty of the policy or in the application therefore by Tenant, the use of
the Premises for more hazardous purposes or change of ownership of the Premises
and that the policy may be canceled or materially altered or reduced in coverage
by the insurer only after thirty (30) days prior written notice to Landlord and
any assignee or mortgagee of Landlord, including Mortgagee, identified in
writing to the insurer, and that the insurer will give written notice to
Landlord or assignee or mortgagee of Landlord, including Mortgagee, identified
in writing to the insurer in the event of the non-payment of any premium by
Tenant when due. Said insurance shall be in the amount of
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the full replacement cost of the improvements on the Premises as determined by
the insurance company in accordance with its normal and customary internal
procedures. Landlord shall be provided with a certificate of such insurance
on an annual basis.
All such bodily injury liability insurance and property damage liability
insurance shall specifically make reference to the indemnity agreement contained
in ARTICLE VIII hereof and shall name Landlord as additional insured.
9.3 WORKER'S COMPENSATION COVERAGE. Worker's compensation coverage
insurance shall be procured by Tenant in whatever amounts are necessary to
comply with the requirements of the State of Texas or, to the extent permitted
by state law, Tenant shall self-insure for Tenant's employees.
9.4 POLICY FORM. Insurance required hereunder shall be in companies
reasonably satisfactory to Landlord licensed to operate in the State of Texas
holding a rating as may be required by any lender having a lien on the Premises
as set forth in the most current issue of "Best's Insurance Guide" but in any
event a rating of at least A:X, it being understood that if the insurer has a
rating of A:X or better, a lender may not require an insurance company with a
higher rating and in any case where a change of insurers is required as a result
of decline in an insurer's Best's rating, such change need not be effected until
the end of the current policy year. Tenant shall deliver to Landlord
certificates evidencing the existence and amounts of such insurance with loss
payable clauses as required by this Paragraph. No such policy shall be
cancelable or subject to reduction of coverage or other modification except
after thirty (30) days prior written notice to Landlord of the expiration of
such policies. Tenant shall furnish Landlord with renewals or "binders"
thereof. Tenant may effect the insurance coverage required by this Lease
through primary and excess lines of insurance. Tenant may have a maximum
deductible not in excess of Twenty Thousand and no/100 Dollars ($20,000.00),
adjusted annually for increases in the Consumer Price Index. For each Lease
Year, Tenant's Maximum Deductible shall be determined by multiplying Tenant's
current maximum deductible (inclusive of previous annual increases) by a
fraction, the numerator of which is the Consumer Price Index for the month
immediately preceding the first day of the Lease Year for which the Maximum
Deductible is to be determined and the denominator of which is the Consumer
Price Index for the month immediately preceding the Commencement Date. The
requirements of SECTION 9.2 shall not preclude Tenant from carrying additional
bodily injury liability insurance and/or property damage liability insurance in
its name and at its cost.
9.5 TENANT'S FAILURE TO MAINTAIN INSURANCE. If Tenant fails to comply
with the foregoing insurance requirements, then Landlord may obtain such
insurance and Tenant shall pay to Landlord on demand the premium cost thereof
plus interest at the Default Rate, from the date of payment by Landlord until
payment by Tenant.
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ARTICLE X
ALTERATIONS AND FIXTURES
10.1 ALTERATIONS AND ADDITIONS.
A. At any time during the Term of this Lease, Tenant shall have the
right to make additions and alterations in and to the Premises, provided such
additions and alterations do not (1) materially change the general character of
the Buildings located on the Premises, (2) materially reduce the value of the
Premises, (3) cause the Premises to violate any terms of this Lease, or (4) have
a cost that is estimated to exceed Two Hundred and Fifty Thousand and no/100
Dollars ($250,000.00) in the aggregate, in any calendar year. Tenant agrees to
provide written notice of such proposed additions or alterations to Landlord and
Mortgagee for them to review, together with copies of plans for such alterations
or additions, but Landlord and Mortgagee shall not have the right to approve or
disapprove such proposal unless it falls within one of the exceptions set forth
above.
B. Prior to making any structural additions or alterations to the
Premises, where the cost of such additions or alterations is estimated to exceed
Two Hundred Fifty Thousand Dollars and No/100 Dollars ($250,000.00) in the
aggregate, in any calendar year. Tenant shall submit to Landlord and Mortgagee a
plan showing the nature and extent of such additions and alterations. Landlord
shall have a period of thirty (30) days, time being of the essence, to review
and provide Tenant with written notice that Landlord and Mortgagee:
1. approves the proposed structural alteration or addition;
2. approves, with modifications, the proposed
structural alterations or additions; in this event, Landlord
shall set out its proposed modifications in detail; or
3. disapproves the proposed structural alterations
stating the basis for such disapproval, provided that
Landlord's approval shall not be unreasonably withheld. In
the event that Landlord does not respond to Tenant within
thirty (30) days of the submission of the proposed
structural alterations or additions to Landlord, such
alterations or additions shall be deemed approved by
Landlord.
If Landlord and Mortgagee approve, or approve with modifications, such matters
Tenant shall have the right to have such work performed as approved. If
Landlord and Mortgagee disapprove the proposed structural alterations or
additions, Tenant shall not perform the work, but may resubmit plans designed to
meet the objections raised by Landlord and Mortgagee. Landlord's and
Mortgagee's approval may not be unreasonably withheld, provided however, the
failure of Mortgagee to approve any additions or alterations will be deemed to
be a reasonable basis for Landlord's disapproval. Prior to commencing work,
Tenant shall obtain, at its expense, all necessary permits and builder's risk
insurance in an amount equal to construction costs. Upon completion of any
structural additions or
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alterations, Tenant shall deliver to Landlord updated plans and
specifications reflecting such structural additions or alterations and a
final certificate of occupancy issued subsequent to the completion of the
additions or alterations. Landlord shall have title to and ownership of all
structural alterations and additions, and all structural alterations and
additions shall be subject to the provisions of this Lease. All such
alterations or additions shall be at Tenant's expense. All such structural
alterations or additions referred to in this Paragraph shall be expeditiously
completed in a good and workmanlike manner and in compliance with all
applicable laws, rules, regulations, ordinances and restrictions then in
effect.
10.2 TRADE FIXTURES. Notwithstanding any provision in this ARTICLE X to
the contrary, all normal trade fixtures, equipment, shelves, racks, machinery,
office equipment, furniture and other personal property installed or placed in
the Premises by Tenant or any of Tenant's subsidiaries, other than replacements
for fixtures, equipment, shelves, machinery, and furniture constituting fixtures
that are in the Premises on the Commencement Date ("Tenant's Trade Fixtures")
may be removed by Tenant on or before the termination date of this Lease;
provided (a) the removal shall be done in a workmanlike manner so as not to
damage the structural integrity of the Building; and (b) Tenant, at Tenant's
sole expense, shall repair all damage to the Premises resulting from the removal
of Tenant's Trade Fixtures.
ARTICLE XI
MECHANICS' AND MATERIALMEN'S LIENS
11.1 Tenant shall not create or permit to be created or to remain, and will
discharge by payment or bond, any lien (including, but not limited to, the liens
of mechanics, laborers, artisans, or materialmen for work or materials alleged
to be done or furnished in connection with the Premises), encumbrance, or other
charge upon the Premises or any part thereof, upon Landlord's interest therein,
or upon Tenant's leasehold interest; provided, that Tenant shall not be required
to discharge any such liens, encumbrances, or charges as may be placed upon the
Premises by the act of Landlord.
ARTICLE XII
SIGNS
12.1 Landlord shall have the right to approve or disapprove the number and
location of, and changes in, any and all exterior signs which are installed,
erected, attached, and/or maintained on the exterior of the Premises.
ARTICLE XIII
SUBLETTING
13.1 SUBLETTING. Tenant shall have the right at all times and from time
to time during the Term to sublease all or any portion of the Premises without
Landlord's consent,
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subject, however, to the same limitations for subleasing by Landlord set
forth in Section 5.6 of the First Mortgage. Tenant shall not have the right,
however, to enter into any sublease agreement concerning the use or occupancy
of the Premises that would extend beyond the Term of this Lease without
Landlord's prior written consent. Tenant shall remain liable for all
obligations under this Lease notwithstanding any sublease hereunder by Tenant
that does not extend beyond the term of this Lease.
13.2 TRANSFER OF LANDLORD'S INTEREST. In the event of the transfer by
Landlord of its interest in this Lease or the Premises, Landlord shall be
released from any further obligations under this Lease, and Tenant agrees to
look solely to Landlord's successor in interest for performance of the
obligations of "Landlord" under this Lease.
ARTICLE XIV
QUIET ENJOYMENT
14.1 Tenant, upon its payment of all rents and sums herein provided and
upon its compliance with the performance of all those provisions, terms, and
conditions applicable to and performable by Tenant, shall peaceably and quietly
hold occupy, and enjoy the Premises for the Term without hindrance, ejection, or
interruption by Landlord, or persons lawfully or equitably claiming under or
through Landlord; provided that this covenant shall be binding upon Landlord and
its successors and assigns only with respect to breaches occurring during its or
their respective ownership of Landlord's interest hereunder.
ARTICLE XV
RIGHT OF ACCESS
15.1 Landlord shall have the right, but not the obligation, to enter the
Premises upon twenty-four (24) hours advance notice to Tenant and during
reasonable business hours (except in an emergency) to examine the same and, if
Tenant has not made such repairs within thirty (30) days after written notice
thereof (or a shorter period if there is a danger to life or property), to make
such repairs, alterations, improvements, or additions as Tenant has failed to
make in accordance with the terms of this Lease, and Landlord shall be allowed
to take all materials into and upon the Premises that may be required therefor
without the same constituting an eviction of Tenant, actual or constructive, and
the Rent shall in no way xxxxx while such repairs, alterations, improvements, or
additions are being made, by reason of loss or interruption of business of
Tenant; provided, however, that Landlord shall not unreasonably interfere with
the normal business operations of Tenant.
ARTICLE XVI
HOLDING OVER
16.1 Should Tenant remain in possession of the Premises, or any part
thereof, after termination of this Lease (whether by the expiration of the Term
or otherwise) without the execution of a new lease by Landlord and Tenant,
Tenant, at the option of Landlord, shall
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become a tenant from month-to-month of the Premises, or any part thereof, at
one hundred and ten percent (110%) of the monthly Rent pro rated and
effective in the last month of the Term, and under all other terms,
conditions, provisions, and obligations of this Lease insofar as the same are
applicable to a tenancy from month-to-month.
ARTICLE XVII
EVENTS OF DEFAULT, LANDLORD'S REMEDIES
17.1 EVENTS OF DEFAULT. The occurrence of any of the following events
shall constitute an Event of Default (herein so called) by Tenant under this
Lease:
A. Failure of Tenant to pay when due an installment of Rent,
Additional Rent or any other amount payable to Landlord hereunder following the
expiration of five (5) days after notice from Landlord.
B. Failure of Tenant to comply with any term, condition or covenant
of this Lease following the expiration of thirty (30) days after notice from
Landlord, provided, however, if the failure to comply cannot reasonably be cured
within such thirty (30) day period, and Tenant commences efforts to cure within
the thirty (30) day period, Tenant shall have a reasonable time to cure such
default.
C. Insolvency of, or the making of a transfer in fraud of creditors
or a general assignment for the benefit of creditors by Tenant.
D. The occurrence of a Bankruptcy Event.
E. Assignment of Tenant's interest in this Lease by operation of
law.
17.2 LANDLORD'S REMEDIES. Upon the occurrence of any Event of Default,
and the expiration of any applicable grace period, Landlord may, in addition to,
and not in derogation of any remedies for any preceding breach or covenant, with
or without notice of demand (except as otherwise expressly provided in this
Lease) and without limiting Landlord in the exercise of any right or remedy
which Landlord may have by reason of such default or breach:
A. Immediately or any time thereafter while such Event of Default
continues, mail a notice of termination addressed to Tenant and proceed pursuant
to and with due process of law, to repossess the same as Landlord's former
estate without prejudice to any remedies which might otherwise be used for
arrears of rent or prior to breach of covenant, and upon such notice as
aforesaid this Lease shall terminate, but Tenant shall remain liable for its
default hereunder as hereinafter provided. Tenant shall have the right to cure
any default until the expiration of the applicable grace period, if any,
following notice by Landlord, as specified above. Where Landlord has given
notice as provided for above, no further notice shall be required to effectuate
a termination of this Lease, which termination shall occur automatically unless
the default is cured within the time periods provided in this Lease.
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B. Terminate Tenant's right to possession of the Premises by court
order or any lawful means, in which case Tenant's right to possession under this
Lease shall terminate, and Tenant shall immediately surrender possession of the
Premises to Landlord. In such event, Landlord shall be entitled to recover from
Tenant all damages incurred by Landlord by reason of Tenant's default,
including, but not limited to, the cost of recovering possession of the
Premises; reasonable expense of reletting, including necessary renovation and
alteration of the Premises; reasonable attorney's fees and any reasonable real
estate commissions actually paid; the worth at the time of award by the court
having jurisdiction thereof of the amount by which the unpaid rent for the
balance of the term after the time of such award exceeds the amount of such
rental loss for the same period that Tenant proves could be reasonably avoided;
and that portion of any reasonable leasing commissions paid by Landlord
applicable to the unexpired Term of this Lease.
C. Landlord can continue this lease in full force and effect, and
this Lease will continue in effect as long as Landlord does not terminate
Tenant's right to possession, and Landlord shall have the right to collect Rent
when due. After the occurrence of an Event of Default, Landlord can enter the
Premises and relet them, or any part of them, to third parties for Tenant's
account. Tenant shall be liable immediately to Landlord for all reasonable
costs Landlord incurs in reletting the Premises. Reletting can be for a period
shorter or longer than the remaining Term of this Lease. Tenant shall pay to
Landlord the Rent on the dates the Rent is due, less the rent Landlord receives
from any reletting. No act by Landlord allowed by this Paragraph shall
terminate this Lease unless Landlord notifies Tenant that Landlord elects to
terminate this Lease. After Tenant's default and for as long as Landlord does
not terminate Tenant's right to possession of the Premises, if Tenant obtains
Landlord's consent, Tenant shall have the right, subject to the limitations set
forth in SECTION 5.6 of the First Mortgage, to assign or sublet its interest in
this Lease, but Tenant shall not be released from liability. Landlord's consent
to such a proposed assignment or subletting shall not be unreasonably withheld.
If Landlord elects to relet the Premises as provided in this
paragraph, rent that Landlord receives from reletting shall be applied to the
payment of:
FIRST, any indebtedness from Tenant to Landlord other than Rent
due from Tenant;
SECOND, all reasonable costs incurred by Landlord in reletting;
THIRD, Rent due and unpaid under this Lease. After deducting the
payments referred to in this subparagraph, any sum remaining from the
rent Landlord receives from reletting shall be held by Landlord and
applied in payment of future Rent as Rent becomes due under this
Lease. If, on the date Rent is due under this Lease, the rent
received from the reletting is less than the Rent due on that date,
Tenant shall pay to Landlord, in addition to the remaining Rent due,
all reasonable costs Landlord incurred in reletting that remain after
applying the rent received from the reletting as provided in this
subparagraph.
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D. Pursue any other remedy now or hereafter available to Landlord
under the laws or judicial decisions of the State of Texas.
E. Pursuit of any of the foregoing remedies does not constitute an
irrevocable election of remedies nor preclude pursuit of any other remedy
provided elsewhere in this Lease or by applicable law, and none is exclusive of
another unless so provided in this Lease or by applicable law. Likewise,
forbearance by Landlord to enforce one or more of the remedies available to it
on an Event of Default does not constitute a waiver of that default or of the
right to exercise that remedy later or of any rent, damages or other amounts due
to Landlord hereunder.
17.3 ATTORNEYS' FEES. In the event that Tenant defaults in the
performance of any of the terms, covenants, agreements, or conditions contained
in this Lease and Landlord places the enforcement of this Lease, or any part
thereof, or the collection of any rent or charge due, or to become due, or the
recovery of the possession of the Premises, in the hands of attorneys, or files
suit upon the same, Tenant agrees to pay Landlord's reasonable attorneys' fees.
ARTICLE XVIII
WAIVER OF LANDLORD'S LIEN
18.1 Landlord hereby waives all of Landlord's rights to any contractual,
statutory, constitutional or other lien or security interest on any of Tenant's
property or the property of any assignee or subtenant that may now or at any
time hereafter be situated on the Premises.
ARTICLE XIX
SUBORDINATION AND ATTORNMENT, TERMINATION
19.1 SUBORDINATION. Landlord shall have the right to transfer, assign,
mortgage and convey in whole or in part the Premises or the Site and any and all
of its rights under this Lease, and nothing herein shall be construed as a
restriction upon Landlord's doing so. Tenant hereby subordinates this Lease and
all rights of Tenant hereunder to any mortgage or deed of trust, and all
renewals, substitutions and extensions thereof, that is now or may hereafter be
placed on the Premises covered by this Lease. Tenant agrees to execute any
certificate or instrument, including without limitation the Tenant estoppel
letter described in SECTION 19.3 below, that may be deemed, in Landlord's sole
discretion, necessary to further effect the subordination of this Lease to such
mortgage or to confirm any election to continue the Lease in effect in the event
of foreclosure, as provided above. Tenant hereby constitutes and appoints
Landlord as Tenant's attorney-in-fact to execute any such certificate or
instrument, including the Tenant estoppel letter described in SECTION 19.3
below, for and on behalf of Tenant.
19.2 ATTORNMENT ON FORECLOSURE. Landlord and Tenant agree that, if any
person or entity acquires the Premises as a purchaser at any foreclosure sale or
by deed in
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lieu of foreclosure (any such mortgagee or other lienholder or purchaser by
deed in lieu of foreclosure or at a foreclosure sale being each hereinafter
referred to as the "Purchaser at Foreclosure"), Tenant, at Tenant's sole
discretion, shall, on the written request of the Purchaser at Foreclosure,
attorn to the Purchaser at Foreclosure and thereafter remain bound as if a
new and identical Lease between the Purchaser at Foreclosure, as landlord,
and Tenant, as tenant, had been entered into as of the date of foreclosure
for the remainder of the Term, except that the Purchaser at Foreclosure shall
not be liable for any act or omission of any prior landlord, subject to any
offsets, claims, or defenses that Tenant might have against any prior
landlord, or bound by any rent that Tenant might have paid more than one (1)
month in advance or any amendment to this Lease made without its prior
written consent.
19.3 ESTOPPEL LETTERS. Within ten (10) days after Landlord's request, from
time to time, Tenant shall execute and deliver to Landlord or to a mortgagee or
prospective purchaser, as directed by Landlord, a statement in writing, in the
form attached hereto as EXHIBIT C.
19.4 TERMINATION. Notwithstanding any provision hereof or any provision
of that certain Subordination, Attornment and Non-Disturbance Agreement
("SANDA") dated the same date as this Lease executed by Landlord and Tenant to
the contrary, upon satisfaction of the following conditions and (i) if a
Termination Event occurs under SECTION 19.4A below, the Lease will automatically
terminate in accordance with such provision, or (ii) if a Termination Event
occurs under SECTION 19.4B below, Tenant shall have the right to terminate this
Lease in accordance with such provision, and in either event, Tenant shall have
no further liability or obligation to Landlord, other than the payment of Rent,
Additional Rent and other amounts due under this Lease through and including
the date of termination.
A. If a Termination Event occurs and the purchaser of the Mortgaged
Property (as defined in the First Mortgage) at such foreclosure sale is a person
or entity other than Mortgagee or any of Mortgagee's affiliates, then this Lease
shall terminate effective upon the date which is fifteen (15) days after the
foreclosure sale. Upon such a Termination Event, Tenant shall be
unconditionally obligated to pay to Mortgagee a Termination Fee in the amount of
the difference (if positive) between (1) the amount of the Pre-Foreclosure Debt
on the date of the foreclosure sale, and (2) the amount of the successful final
bid at such foreclosure sale for the purchase of the Mortgaged Property. The
Termination Fee shall be due and payable by Tenant to Mortgagee on or before the
date that is ninety (90) days after the date of the foreclosure sale, and if
Tenant fails or refuses to pay the Termination Fee, Mortgagee shall have all
rights and remedies available to it to collect such debt under all applicable
laws. Notwithstanding any default under the Lease on the date of the
foreclosure sale, Tenant shall have the right to continue to occupy the Premises
for a period of up to fifteen (15) days after the foreclosure sale for the sole
purpose of removing any of its property that is not part of the Mortgaged
Property from the Premises in accordance with the terms of this Lease regarding
removal of Tenant's property at the termination or expiration of this Lease, and
this provision shall be binding on any purchaser at any foreclosure sale.
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B. If a Termination Event occurs and the purchaser of the Mortgaged
Property at such foreclosure sale is Mortgagee or any of Mortgagee's affiliates,
then Tenant shall have the option, exercisable by delivering written notice to
Mortgagee on or before the date that is thirty (30) days after the date of the
foreclosure sale, to either (i) agree that Tenant shall continue to be bound by
the terms of this Lease for the remainder of the Term and that Tenant shall have
no further right to terminate this Lease, or (ii) terminate this Lease effective
upon the date that is one hundred (100) days after the date of the foreclosure
sale. If Tenant chooses to terminate the Lease pursuant to (ii) above, Tenant
shall be unconditionally obligated to pay to Mortgagee a Termination Fee in the
amount of the greater of (a) ONE MILLION EIGHT HUNDRED TWENTY-FIVE THOUSAND AND
NO/100 DOLLARS ($1,825,000.00) or (b) the difference (if positive) between (1)
the amount of the Pre-Foreclosure Debt on the date of the foreclosure sale, and
(2) the Fair Market Value (as defined in C. below) of the Mortgaged Property.
The Termination Fee shall be due and payable by Tenant to Mortgagee on or before
the later of (x) the date that is sixty (60) days after the date of the
termination of the Lease or (y) ten (10) days following the determination of the
Fair Market Value of the Mortgaged Property in accordance with SECTION 19.4C
below, and if Tenant fails or refuses to pay the Termination Fee, Mortgagee
shall have all rights and remedies available to it to collect such debt under
all applicable laws. Notwithstanding the termination of the Lease as set forth
above, Tenant shall have the right to continue to occupy the Premises for a
period of up to fifteen (15) days after the termination of the Lease for the
sole purpose of removing any of its property that is not part of the Mortgaged
Property from the Premises in accordance with the terms of this Lease regarding
removal of Tenant's property at the termination or expiration of this Lease.
C. For purposes of this SECTION 19.4, the term "FAIR MARKET VALUE OF
THE MORTGAGED PROPERTY" shall be calculated in accordance with this SECTION
19.4C. Following a termination of the Lease in accordance with SECTION 19.4B,
Mortgagee and Tenant shall use reasonable efforts to agree upon value for the
Fair Market Value of the Mortgaged Property, and if the parties cannot agree
upon the Fair Market Value of the Mortgaged Property within ten (10) days after
the termination of the Lease, then each of Mortgagee and Tenant, within ten (10)
days thereafter, shall choose and engage (it being agreed that Tenant shall
reimburse Mortgagee or pay for the cost and expense of all appraisals) an
independent MAI-certified real estate appraiser experienced in determining the
fair market value of office, manufacturing and warehouse properties which are
similar to the Mortgaged Property in the general area of the Mortgaged Property
in order to determine the Fair Market Value of the Mortgaged Property
("QUALIFIED APPRAISER") in accordance with the assumptions and parameters set
forth in this Paragraph C. If either party fails to select a Qualified Appraiser
within such 10-day period, then the other party shall choose a second Qualified
Appraiser. Each Qualified Appraiser shall be required to use their best efforts
to complete their initial appraisal report and submit it to the party requesting
same within twenty (20) days after the date of their engagement for such party's
review and comment, and Mortgagee and Tenant shall each deliver to the other the
final appraisal report determining the Fair Market Value of the Mortgaged
Property (each a "FIRST ROUND APPRAISAL") within thirty (30) days after the
engagement of the Qualified Appraisers.
1. If the difference in the values determined in each First
Round Appraisal is less than or equal to ten percent (10%) of the value
determined by the
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lower of the two First Round Appraisals, then the Fair Market Value of
the Mortgaged Property shall be the average between the values determined
in each First Round Appraisal.
2. If the difference in the values determined in each First
Round Appraisal is more than ten percent (10%) of the value determined by
the lower of the two First Round Appraisals, then the two Qualified
Appraisers selected by Mortgagee and Tenant shall choose a third Qualified
Appraiser (the cost of which shall be borne by Tenant) to determine the
Fair Market Value of the Mortgaged Property, who shall use his best efforts
to complete his appraisal report (the "THIRD APPRAISAL" and submit it to
Mortgagee and Tenant within twenty (20) days after the date of his
engagement. Mortgagee and Tenant agree that the Fair Market Value of the
Mortgaged Property shall be the average between the values determined in
(a) the Third Appraisal and (b) the First Round Appraisal which determined
a value that was closer to the value determined by the Third Appraisal than
the value determined by the other First Round Appraisal.
Mortgagee and Tenant agree that, for purposes of this SECTION 19.4 and of
determining the Fair Market Value of the Mortgaged Property, all Qualified
Appraisers selected by the parties may not consider and should disregard the
Master Lease as a component to the Fair Market Value of the Mortgaged Property,
and that the Fair Market Value of the Mortgaged Property should reflect the
fair market value of only the fee interest in the Mortgaged Property and any and
all easement, privileges and appurtenances thereto, assuming the Mortgaged
Property is vacant.
D. Any Termination Fee payable by Tenant to Mortgagee under this
SECTION 19.4 shall be in the form of cash or immediately available funds or by
the execution and delivery of a promissory note with a maturity date of no later
than 180 days thereafter.
ARTICLE XX
CASUALTY AND CONDEMNATION
20.1 FIRE AND CASUALTY DAMAGE.
A. In the event of a casualty, Tenant shall (i) have no right to
terminate this Lease and (ii) be required to restore the improvements and will
be entitled to the insurance proceeds to the extent required to restore the
Premises. In the event the net proceeds on any claim are not in excess of One
Hundred Thousand and No/100 Dollars ($100,000.00), such proceeds shall be
payable to Tenant. In the event the net proceeds are in excess of One Hundred
Thousand and No/100 Dollars ($100,000.00), such sum shall be paid to and
deposited with either a bank or trust company having an office in the State of
Texas and designated by Tenant, subject to the reasonable approval of Landlord.
Such bank or trust company (the "Proceeds Trustee") shall hold such funds in the
name of the Proceeds Trustee as trustee for Landlord and Tenant and the funds
shall be disbursed in the manner hereinafter provided. Notwithstanding the
above, Mortgagee may, at its option, be appointed Proceeds Trustee for so long
as the First Mortgage remains outstanding. The
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Proceeds Trustee shall deposit insurance proceeds in an interest bearing
account (if available), and interest shall be distributed to Tenant upon
completion of said installation, repair, replacement or rebuilding, provided
no default has occurred and is continuing hereunder. All checks drawn on
said account shall be co-signed by the Proceeds Trustee and Tenant.
Insurance proceeds shall be disbursed to Tenant by the Proceeds Trustee upon
receipt by Landlord and Proceeds Trustee of the following:
1. A certificate signed by a licensed architect or engineer
selected by Tenant, subject to the approval of Landlord (such approval
not to be unreasonably withheld or delayed) and also signed by Tenant,
dated not more than thirty (30) days prior to the application for such
disbursement, setting forth in substance the following:
a. that the sum then requested to be disbursed either
has been paid by Tenant or is justly due to contractors,
subcontractors, materialmen, engineers, architects or other
persons (whose names and addresses shall be stated) who have
rendered and furnished certain labor and materials for the
work; giving a brief description of such services and
materials and the principal subdivisions or categories
thereof and the amounts so paid or due to said persons in
respect thereof, and stating the progress of the work up to
the date of said certificate;
b. that the sum then requested to be disbursed, plus
all sums previously disbursed, does not exceed the cost of
the work as actually accomplished up to the date of such
certificate (less than ten percent (10%) of such cost which
shall be retained by the Proceeds Trustee to be disbursed
following completion of the work to be done by the named
contractor);
c. that except for the amounts, if any, stated in
said certificate pursuant to the foregoing clause a. of this
Paragraph to be due for services or materials, there is no
outstanding indebtedness known to the person signing the
certificate, after due inquiry, which is then due and
payable for work, labor, services and materials in
connection with the work, which, if unpaid, might become the
basis of a vendor's, mechanic's, laborer's, or materialman's
statutory or similar lien upon Tenant's leasehold estate or
Tenant's or Landlord's interest in the Premises or any part
thereof; and
d. that the amount remaining in the possession of the
Proceeds Trustee after disbursement of the sum then
requested at least equals the estimate unpaid costs to
complete the work (and if insufficient funds remain, Tenant
shall deposit additional funds with the Proceeds Trustee
sufficient to enable the architect or engineer to make the
foregoing certification).
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2. A certificate signed by Tenant, dated not more than thirty
(30) days prior to the application for such disbursement, setting
forth in substance that, to the best knowledge of Tenant, after due
inquiry:
a. all materials and all property described in the
certificate are free and clear of all liens and
encumbrances, except such as may secure indebtedness due to
persons (whose names and addresses and the several amounts
due them shall be stated) specified in said certificate,
which liens and encumbrances will be discharged upon payment
of such indebtedness and encumbrances to which this Lease is
subject; and
b. that no Event of Default has occurred which has
not been remedied.
3. Evidence reasonably satisfactory to the Proceeds Trustee and
Landlord showing that there has not been filed with respect to
Tenant's leasehold estate or Tenant's or Landlord's interest in the
Premises or any part thereof any vendor's, mechanic's, laborer's or
materialman's statutory or similar lien which has not been discharged
of record, except such as will be discharged upon payment of the
amount then requested to be disbursed.
4. Lien waivers from each person entitled to a mechanic's or
materialman's lien against the Premises by reason of such work.
5. Upon compliance with the foregoing provisions, the Proceeds
Trustee shall, out of the deposited sums, disburse to the persons
named in the certificate the respective amounts stated in said
certificate to be due to them and/or shall disburse to Tenant the
amount stated in said certificate to have been paid by Tenant.
6. At any time after the completion in full of the work, the
whole balance of the deposited sums not theretofore disbursed pursuant
to the foregoing provisions of this subparagraph shall be disbursed to
or upon the order of Tenant, upon receipt by the Proceeds Trustee of
any of the following:
a. a certificate signed by Tenant, dated not more
than twenty (20) days prior to the application for such
disbursement, setting forth in substance the following to
the best knowledge of Tenant, after due inquiry;
(1) that the work has been completed in
full;
(2) that all amounts which Tenant is or may
be entitled to have disbursed under the foregoing
provisions of this subparagraph on account of
services rendered or materials furnished in
connection with the work have been disbursed
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under said provisions;
(3) that all amounts for whose payment
Tenant is or may become liable in respect of the
work have been paid in full except to the extent,
if any, of any retainage and which retainage shall
be applied to the final payments of the amounts
due; and
(4) that no Event of Default has occurred
which has not been remedied;
b. a copy of the final plans and specifications of
the improvements in the Premises, which plans and
specifications shall be delivered to Landlord;
c. an official search or a certificate of a title
company reasonably satisfactory to the Proceeds Trustee
showing that there has not been filed with respect to
Tenant's leasehold estate or Tenant's or Landlord's interest
in the Premises, or any part thereof, any vendor's
mechanic's, laborer's or materialman's statutory or similar
lien which has not been discharged of record;
d. a certificate of completion signed by the
supervising architect or engineer referred to in
subparagraph (1) above; and
e. a certificate of occupancy or equivalent
governmental approval.
Any insurance proceeds remaining after completion of the
reconstruction as specified in subparagraph 6. above shall be paid to Tenant.
If the conditions for the release of money to Tenant are not met after a period
of one hundred eighty (180) days after the date of completion of reconstruction
(such 180 day period to be extended by the length of any delay caused by reasons
beyond the control of Tenant), any funds held by the Proceeds Trustee shall be
disbursed to Landlord or its assignee. If the Premises shall be damaged by fire
or other casualty resulting from the fault or negligence of Tenant or any of
Tenant's agents, employees, or invitees, then (a) Rent shall not be diminished
during the repair of such damage, and Tenant shall be liable to Landlord for the
cost and expense of the repair and restoration of the Premises caused thereby to
the extent that such cost and expense is not covered by insurance proceeds.
20.2 CONDEMNATION.
A. TOTAL OR SUBSTANTIAL CONDEMNATION. If all or substantially all of
the Premises shall be taken for public or quasi-public purposes, or if Tenant,
after any taking, would be unable to restore the Buildings to substantially
their condition prior to such event because it is legally impermissible or not
physically or financially feasible to do so with the proceeds of the
condemnation award or the portion remaining can (in Landlord's reasonable
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judgment), with rebuilding, restoration or repair, be profitably operated for
the purpose it was being used immediately prior to the taking or diminution (a
"Substantial Taking") Tenant shall, not later than ninety (90) days after the
date of service of an order for possession on Landlord or Tenant by the
condemning agency or condemning authority, deliver to Landlord (i) notice of its
intention to terminate this Lease on a date (the "Termination Date") occurring
not more than one hundred eighty (180) days nor less than ninety (90) days after
the date of service of such order for possession on Landlord or Tenant provided,
that the determination of the Termination Date shall be subject to the authority
of the condemning agency, condemning authority, or any stay or vacation of such
order issued pursuant to applicable law, (ii) a certificate by Tenant describing
the event giving rise to such termination and stating that such event has
rendered the Premises unavailable for use or unsuitable for restoration for
continued use of occupancy in Tenant's business, and (iii) an irrevocable offer
to purchase the Premises, together with any condemnation award or rights
thereto, on the next Rent payment date occurring more than thirty (30) days
after the receipt of, by Landlord, such offer. The purchase price pursuant to
any such offer to purchase the Premises shall be the sum necessary to satisfy
any and all amounts due and owing, including all unpaid principal, all accrued
and unpaid interest, (but not any prepayment premium on First Mortgage)
(hereinafter the "Purchase Price"). Landlord shall have thirty (30) days after
receipt of notice within which to reject such offer. If Landlord rejects the
offer, this Lease shall terminate on the Termination Date, except with respect
to obligations and liabilities of Tenant hereunder, actual or contingent, which
have arisen on or prior to such date, upon payment by Tenant of all unpaid Rent,
Additional Rent and other sums then due and payable hereunder to and including
such date. If Landlord rejects the offer, any condemnation proceeds shall
belong to Landlord or to Landlord's mortgagee, provided, however, that nothing
herein contained shall prevent Tenant from pursuing its own remedies with
respect to business interruption, moving expenses, fixtures and other costs to
Tenant provided that such remedies do not result in a decrease in any award to
Landlord. If Landlord does not reject Tenant's offer within the thirty (30) day
period, the offer shall be deemed accepted and on the next Rent payment date
occurring more than thirty (30) days after the receipt by Landlord of such
offer, Landlord shall convey the Premises and any condemnation award and the
right thereto to Tenant upon payment of the Purchase Price and all Rent and
other sums due and payable hereunder to and including such date. Title to the
Premises shall be subject only to encumbrances existing on the Commencement
Date, this Lease, encumbrances arising after the Commencement Date not consented
to or created by Landlord, and other encumbrances consented to at any time by
Tenant. Tenant shall accept a special or limited warranty deed conveying such
title and shall accept the Premises in their "as is" condition. Upon completion
of such purchase, but not prior thereto, this Lease shall terminate, except with
respect to obligations and liabilities hereunder, actual or contingent, which
arose on or prior to the date of purchase. Tenant shall bear all costs
associated with such conveyance. A "taking" under this Paragraph shall be
deemed to have occurred at such time as the relevant governmental authority
effecting the "taking" shall have taken possession of the Premises pursuant to a
court order or judgment by a court of captioned jurisdiction in accordance with
applicable law.
B. PARTIAL CONDEMNATION. If less than the whole or substantially
the whole of the Premises is taken for any public or quasi-public use under any
governmental
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law, ordinance, or regulation, or by right of eminent domain, or should be
sold to a condemning authority in lieu of condemnation, and such taking is
not a Substantial Taking, and no Event of Default under the First Mortgage
has occurred or is continuing, then Tenant shall (1) deliver to Landlord
plans and specifications for such rebuilding, restoration or repair
acceptable to Landlord, and (2) thereafter commence the rebuilding,
restoration or repair of the Premises in accordance with the approved plans
and specifications within three (3) months after the date of the taking or
diminution in value; provided, however, that Tenant's restoration and
rebuilding obligations shall not exceed the scope of the work done by Tenant
in originally constructing the Premises.
C. DISPOSITION OF AWARDS. Except as herein otherwise provided, all
awards arising from a total or partial taking of the Premises, or a taking for
temporary use, shall belong to and be the property of Landlord or during the
period there is a first mortgage covering the Premises of Landlord's mortgagee,
without any participation by Tenant. Tenant shall not be entitled to, and
expressly waives all claim to, any such compensation; provided, however, that
Tenant shall be entitled to receive the proceeds of any award specifically
designated by the condemning authority in Tenant's favor, for Tenant's
improvements on Premises and/or relating solely to Tenant's statutory right of
compensation for the loss of its leasehold. Notwithstanding the above, if
Tenant has complied with the provisions of Paragraph B above, all of the
condemnation award granted by the condemning authority for the taking or
diminution in value of the Premises shall be paid over to Tenant by Landlord,
after deducting therefrom the reasonable actual costs and expenses incurred by
Landlord, including reasonable attorney's fees, in connection with such
condemnation and collection of the award.
D. SUBJECT TO FIRST MORTGAGE. Notwithstanding any provision in this
SECTION 20, this SECTION 20 shall be subject in all respects to the provisions
of the First Mortgage regarding condemnation and eminent domain.
ARTICLE XXI
EXISTING LEASES
Landlord and Tenant hereby acknowledge and agree that the Existing
Leases are still in full force and effect and that Tenant's right to possess,
use and occupy those portions of the Premises described in the Existing Leases
shall be subject to the Existing Leases and shall not commence unless and until
the Existing Leases expire or are terminated. Notwithstanding the foregoing,
however, Tenant's obligation to pay or cause to be paid the Rent shall commence
on the Commencement Date, and Landlord, pursuant to that certain Assignment of
Rents to Tenant, has assigned to Tenant the right to receive all rents and other
amounts from the Existing Leases . Tenant shall have the right to direct
Landlord regarding negotiations with Existing Tenants concerning the Existing
Leases and to direct Landlord to terminate the Existing Leases on terms and
conditions acceptable to Tenant without Landlord's consent. So long as an Event
of Default has not occurred under this Lease, Landlord shall immediately deliver
to Tenant any and all amounts that Landlord may hereafter receive from Existing
Tenants with respect to the Existing Leases. Landlord shall have no right to
modify, amend or terminate the Existing
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Leases without the prior written consent of Tenant. Prior to the expiration
or termination of the Existing Leases, Landlord will perform all of the
duties and obligations of the Landlord under the Existing Leases; provided,
however, that Tenant shall have no right to modify or amend the Existing
Leases so as to increase the maintenance, repair or other duties and
obligations of the Landlord under the Existing Leases without the prior
written consent of Landlord. Tenant shall indemnify Landlord for any damages
and liabilities that Landlord may suffer or incur as a result of Landlord
being made a party to any litigation that may hereafter arise between Tenant
and Existing Tenants concerning the Existing Leases except to the extent that
such litigation concerns the failure of Landlord to perform any of the duties
and obligations of the landlord under the Existing Leases or the negligence
or misconduct of Landlord.
After the termination of the Existing Leases, Tenant, at Tenant's option,
shall have the right to, among other things, occupy all or any portion of the
Premises for Tenant's own use or sublease all or any portion of the Premises to
a third party (subject to limitations therein set forth in this Lease or in the
First Mortgage); provided, however, that Tenant shall remain liable for payment
of the Rent during the Term of this Lease.
ARTICLE XXII
ENVIRONMENTAL MATTERS
A. Tenant (i) shall comply, and cause the Premises to comply, with
all Environmental Laws (as hereinafter defined) applicable to the Premises, (ii)
shall prohibit the use of the Premises for the generation, manufacture,
refinement, production, or processing of any Hazardous Material (as hereinafter
defined) or for the storage, handling, transfer or transportation of any
Hazardous Materials (other than in connection with the operation, business and
maintenance of the Premises and in commercially reasonable quantities as a
consumer thereof and supplier of consumer products and in compliance with
Environmental Laws), (iii) shall not permit to remain, install or permit the
installation on the Premises of any surface impoundments, or asbestos-containing
materials and (iv) shall cause any alterations of the Premises to be done in a
way so as to not expose in an unsafe manner the persons working in or visiting
the Premises to Hazardous Materials and in connection with any such alterations
shall remove any Hazardous Materials present upon the Premises, excepting any
Hazardous Material or Substance situated on or under the Premises at the time of
Tenant's taking possession under this Lease, which are not in compliance with
Environmental Laws or which present danger to persons working on or visiting the
Premises.
B. "Environmental Laws" means the Resource Conservation and Recovery
Act of 1976, as amended, 42 U.S.C. section 6901, et seq. (RCRA); the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended by the Superfund Amendments and Reauthorization Act of 1986, 42 U.S.C.
section 9601 et seq. (CERCLA); the Toxic Substance Control Act, as amended, 15
U.S.C. section 26012 et seq.; Texas Water Code; and all applicable federal,
state and local environmental laws, ordinances, rules and regulations, as any of
the foregoing may have been or may be from time to time amended, supplemented or
supplanted, and any other federal, state, or local
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laws, ordinances, rules and regulations, now or hereafter existing relating
to regulations or control of Hazardous Material or materials. The term
"Hazardous Materials" as used in this Lease shall mean substances defined as
"hazardous substances," "hazardous materials," "hazardous waste," or "toxic
substances" in any applicable federal, state or local statute, rule,
regulation or determinations, including but not limited to the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended,
42 USC, Section 9601, et seq.; the Hazardous Materials Transpiration Act, 49
USA, Section 1801, et seq.; the Resource, Conservation and Recovery Act, 42
USC, Section 6901, et seq.; and, asbestos, PCBs, radioactive substances,
methane, volatile hydrocarbons, petroleum or petroleum-derived substances or
wastes, radon, industrial solvents or any other material as may be specified
in applicable law or regulations.
C. Except for liability resulting from or arising out of the willful
misconduct of Landlord or its mortgagee or their agents on or about the Premises
or their successors and assigns, and except as otherwise specifically excluded
from any indemnities of Landlord contained in the First Mortgage, Tenant agrees
to protect, defend, indemnify and hold harmless Landlord, its directors,
officers, employees and agents, and any successors to Landlord's interest in the
chain of title to the Premises, their direct or indirect partners, directors,
officers, employees, and agents, from and against any and all liability,
including all foreseeable and all unforeseeable damages including but not
limited to attorney's and consultant's fees, fines, penalties and civil or
criminal damages, directly or indirectly arising out of the use, generation,
storage, treatment, release, threatened release, presence or disposal of
Hazardous Materials from, on, at, to or under the Premises during the Term of
this Lease, and including, without limitation, the cost of any required or
necessary repair, response action, remediation, investigation, cleanup or
detoxification and the preparation of any closure or other required plans,
whether such action is required or necessary prior to or following transfer of
title to the Premises. This agreement to indemnify and hold harmless shall be
in addition to any other obligations or liabilities Tenant may have to Landlord
at common law under all statutes and ordinances or otherwise, and shall survive
following the date of expiration or earlier termination of this Lease. Tenant
expressly agrees that the representations, warranties and covenants made and the
indemnities stated in this Lease are not personal to Landlord, and the benefits
under this Lease may be assigned to subsequent parties in interest in the chain
of title to the Premises, which subsequent parties in interest may proceed
directly against Tenant to recover pursuant to this Lease. Tenant, at its
expense, may institute appropriate legal proceedings with respect to
environmental matters of the type specified in this subparagraph C or lien for
such environmental matters, not involving Landlord or its mortgagee as a
defendant (unless Landlord or its mortgagee is the alleged cause of the damage),
conducted in good faith and with due diligence, provided that such proceedings
shall not in any way impair the interests of Landlord or its mortgagee under
this Lease or contravene the provisions of any first mortgage. Counsel to
Tenant in such proceedings shall be reasonably approved by Landlord if Landlord
is a defendant in the same proceeding. Landlord shall have the right to appoint
co-counsel, which co-counsel will cooperate with Tenant's counsel in such
proceedings. The fees and expenses of such co-counsel shall be paid by
Landlord, unless such co-counsel are appointed because the interests of Landlord
and Tenant in such proceedings, in Landlord's reasonable judgment,
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are or have become adverse, or Tenant or Tenant's counsel is not conducting
such proceedings in good faith or with due diligence.
D. Tenant, promptly upon the written request of Landlord or
Mortgagee, from time to time, but not more than once in any calendar year unless
required by a governmental order or unless an Event of Default has occurred and
is continuing, shall permit such persons as Landlord or Mortgagee may designate
subject to approval by Tenant (the "Site Reviewers"), which approval shall not
be unreasonably withheld or delayed, to visit the Premises from time to time and
perform environmental site investigations and assessments ("Site Assessments")
on the Premises. Tenant's approval of the Site Reviewers shall not be required
if an Event of Default has occurred and is continuing. The purpose of the Site
Assessment swill be to determine whether there exists on the Premises any
environmental condition which may result in any liability, cost or expense to
Landlord or any other owner or occupier of the Premises relating to Hazardous
Materials. During the course of any Site Assessment, the Site Reviewers shall
not unreasonably interfere with the operations or business of Tenant on the
Premises. The Site Assessments may include both above and below ground testing
and inspection as is reasonable and necessary in the opinion of the Site
Reviewers to identify environmental damage or the presence of Hazardous Material
on the Premises. Tenant shall supply to the Site Reviewers such historical and
operational information regarding the Premises as may be reasonably requested by
the Site Reviewers to facilitate the Site Assessments and shall make available
for meetings with Site Reviewers appropriate personnel having knowledge of such
matters. Tenant shall not be required to make information available to the Site
Reviewers where such information was previously provided to Landlord by Tenant.
The cost of performing and reporting all Site Assessments shall be paid by
Tenant on the same basis as Landlord is required to pay under the First
Mortgage, and such costs will be paid by Tenant within thirty (30) days after
demand by Landlord, with interest to accrue after the expiration of such thirty
(30) day period, on the cost due, at the Default Rate. Landlord, promptly after
written request by Tenant and payment by Tenant as aforesaid, shall deliver to
Tenant copies of reports, summaries or other compilations of the results of such
Site Assessments. Tenant's sole remedy for Landlord's breach of the preceding
sentence shall be a mandatory injunction, and not a termination of this Lease or
a withholding or reduction or rent.
E. Tenant shall notify Landlord and Landlord shall notify Tenant in
writing, promptly upon Tenant's or Landlord's learning of any:
1. notice or claim to the effect that Tenant or Landlord
is or may be liable to any person as a result of the release or
threatened release of any Hazardous Material on the Premises;
2. notice that Tenant is subject to investigation by any
governmental authority evaluating whether any remedial action is
needed to respond to the release or threatened release of any
Hazardous Material on the Premises.
3. notice of the presence of any Hazardous Materials on the
Premises
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ARTICLE XXIII
MISCELLANEOUS PROVISIONS
23.1 NOTICE. Any notice or request (hereinafter severally and collectively
called "notice") in this Lease provided for or permitted to be given, made or
accepted by either party to the other must be in writing, and may, unless
otherwise in this Lease expressly provided, be given or be served by depositing
the same in the United States mail, postpaid and certified and addressed to the
party to be notified, with return receipt requested, or by delivering the same
in person to such party (or, in the case of a corporate or partnership party, to
an officer or general partner of such party, as the case may be), or by prepaid
telegram, when appropriate, addressed to the party to be notified. Notice
deposited in the mail in the manner hereinabove described shall be effective,
unless otherwise stated in this Lease, from and after the date it is so
deposited. Notice given in any other manner shall be effective only if and when
received by the party to be notified. For purposes of notice, the addresses of
the parties shall, until changed as herein provided, be as follows:
For Landlord: IPOP Management, Inc.
00000 Xxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxx, Xxxxx 00000
Attention: President
For Tenant: Input/Output, Inc.
00000 Xxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxx, Xxxxx 00000
Attention: Chief Financial Officer
Landlord and Tenant may, from time to time and at any time, change their
respective addresses by at least fifteen (15) days' written notice to the other
party, delivered in compliance with SECTION 22.1.
23.2 BROKER'S COMMISSION. Tenant and Landlord hereby indemnify each
other, and shall hold each other harmless from and against, all liabilities
arising from any claim for a "broker's or leasing agent's" commission.
23.3 FORCE MAJEURE. If the performance by Landlord of any provision of
this Lease is delayed or prevented by any act of God, strike, lockout, shortage
of material or labor, restriction by any governmental authority, civil riot,
flood, and any other cause not within the control of Landlord, then the period
for Landlord's performance of the provision shall be automatically extended for
the same amount of time that Landlord is so delayed or hindered.
23.4 USE OF LANGUAGE. Words of any gender used in this Lease include any
other gender, and words in the singular include the plural, unless the context
otherwise requires.
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23.5 CAPTIONS. The captions or headings of paragraphs in this Lease are
inserted for convenience only, and shall not be considered in construing the
provisions hereof if any question of intent arises.
23.6 SUCCESSORS. The terms, conditions and covenants contained in this
Lease inure to the benefit of, and are binding on, the parties hereto and their
respective successors in interest, assigns and legal representatives, except as
otherwise herein expressly provided. All rights, powers, privileges, immunities
and duties of Landlord under this Lease, including without limitation, notices
required or permitted to be delivered by Landlord to Tenant hereunder, may, at
Landlord's option, be exercised or performed by Landlord's agent or attorney.
23.7 SEVERABILITY. If any provision of this Lease is finally held by a
court of competent jurisdiction to be invalid or unenforceable, then the invalid
or unenforceable provision shall be deemed severed from this Lease and the
validity and enforceability of the remaining provisions of this Lease shall be
unaffected.
23.8 PERSONAL LIABILITY. Landlord's liability to Tenant for any default
by Landlord under this Lease is limited to Landlord's interest in the Premises,
and Tenant agrees to look solely to Landlord's interest therein for the recovery
of any judgment against Landlord, it being intended that neither Landlord nor
any of its partners, shareholders, agents, affiliates, officers or directors
shall be personally liable for any judgment or deficiency.
23.9 DAMAGE FROM CERTAIN CAUSES. Landlord is not liable or responsible to
Tenant for any loss or damage to any property or person occasioned by theft,
fire, act of God, public enemy, injunction, riot, strike, insurrection, war,
court order, requisition, or order of governmental body or authority, or for any
damage or inconvenience that may arise through repair or alteration of any part
of the Premises, or a failure to make any such repairs.
23.10 GOVERNING LAW. This Lease and the rights and obligations of the
parties hereto shall be interpreted, construed, and enforced in accordance with
the laws of Texas.
23.11 NO PARTNERSHIP. Notwithstanding anything else to the contrary,
Landlord is not and under no circumstances shall it be considered to be a
partner of Tenant or engaged in a joint venture with Tenant.
23.12 NO ORAL CHANGES. This Lease may not be changed or terminated
orally, but only in writing executed by Landlord, Tenant and Mortgagee.
23.13 ENTIRETY; NO REPRESENTATIONS AND WARRANTIES. THIS LEASE EMBODIES
THE ENTIRE AGREEMENT BETWEEN THE PARTIES AND SUPERSEDES ALL PRIOR AGREEMENTS AND
UNDERSTANDINGS, INCLUDING ANY LETTERS OF INTENT, IF ANY, RELATING TO THE SUBJECT
MATTER HEREOF. LANDLORD HAS NOT MADE, AND TENANT MAY NOT RELY ON, ANY
REPRESENTATIONS OR WARRANTIES WITH REGARD TO THE PREMISES,
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EXPRESSED OR IMPLIED, EXCEPT AS STATED IN THIS LEASE. IN PARTICULAR,
LANDLORD HAS NOT AUTHORIZED ANY AGENT OR BROKER TO MAKE A REPRESENTATION OR
WARRANTY IN ADDITION TO OR INCONSISTENT WITH THE TERMS OF THIS LEASE AND
TENANT MAY NOT RELY ON ANY SUCH ADDITIONAL OR INCONSISTENT REPRESENTATION OR
WARRANTY.
23.14 MULTIPLE COUNTERPARTS. This Lease may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
agreement, and any of the parties to this Lease may execute this Lease by
signing any of the counterparts.
[THIS SPACE INTENTIONALLY LEFT BLANK]
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SIGNATURE PAGE
EXECUTED as of the 29th day of August, 1996.
LANDLORD:
IPOP MANAGEMENT, INC.
By: /s/ Xxxxxx X. Xxxxxxxx, President
TENANT:
INPUT/OUTPUT, INC.
By: /s/ Xxxxxx X. Xxxxxxxx, Senior Vice
President, Chief Financial Officer
and Secretary
CONSENTED AND AGREED TO BY MORTGAGEE:
THE VARIABLE ANNUITY LIFE INSURANCE COMPANY
By:/s/ Xxxxxxx X. Xxxx, Xx.
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