EXHIBIT 2.1
OFFICE LEASE
BUILDING: RIVERBEND PARK
LANDLORD: 1330 RIVERBEND INVESTMENT CORP.
TENANT: CFDATA CORP.
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TABLE OF CONTENTS
Page
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TABLE OF CONTENTS....................................... 2
1. CERTAIN LEASE PROVISIONS................................ 4
2. PREMISES................................................ 5
2.1 Definition...................................... 5
2.2 Public Areas.................................... 5
3. TERM.................................................... 5
3.1 Term............................................ 5
3.2 Delay in Commencement........................... 5
3.3 Early Possession................................ 5
3.4 Delivery of Possession.......................... 5
3.5 Holding Over.................................... 5
4. RENT.................................................... 5
4.1 Base Rent....................................... 5
4.2 Additional Rent................................. 6
4.3 Parking and Storage............................. 6
4.4 Acceptance of Rental Payments................... 6
5. ESCALATIONS OF RENT..................................... 6
5.1 Determination................................... 6
5.2 Indexing........................................ 6
6. SHARED EXPENSES......................................... 7
6.1 Determination................................... 7
6.2 Escalations..................................... 7
6.3 Statements...................................... 8
7. SECURITY DEPOSIT........................................ 8
8. USE..................................................... 8
8.1 Use............................................. 9
8.2 Compliance With Law............................. 9
8.3 Waste and Nuisance.............................. 9
8.4 Conditions of Premises.......................... 9
8.5 Insurance Cancellation.......................... 9
8.6 Landlord's Rules and Regulations................ 9
9. LANDLORD'S SERVICES..................................... 9
9.1 Basic Services.................................. 9
9.2 Initial Construction............................ 10
9.3 Interruption of Services........................ 10
10. MAINTENANCE, REPAIRS AND ALTERATIONS................... 10
10.1 Landlord's Obligations.......................... 10
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10.2 Tenants Obligations............................. 10
10.3 Surrender....................................... 11
10.4 Alterations and Additions....................... 11
11. TENANT'S USE OF PUBLIC AREAS........................... 12
12. TAXES AND TELEPHONE.................................... 12
12.1 Personal Property Taxes......................... 12
12.2 Evidence of Payment............................. 12
12.3 Telephone....................................... 12
13. INSURANCE AND INDEMNITY................................ 12
13.1 Liability Insurance............................. 12
13.2 Property Insurance.............................. 12
13.3 Insurance Policies.............................. 13
13.4 Waiver of Subrogation........................... 13
13.5 Hold Harmless................................... 13
13.6 Exemption of Landlord from Liability............ 13
14. DAMAGE OR DESTRUCTION.................................. 13
14.1 Option to Terminate Lease....................... 14
14.2 Obligation to Repair or Restore................. 14
14.3 Fault of Tenant................................. 14
14.4 Obligations of Tenant........................... 14
14.5 Termination by Tenant........................... 14
15. CONDEMNATION........................................... 14
16. ASSIGNMENT AND SUBLETTING.............................. 15
16.1 Landlord's Consent Required..................... 15
16.2 No Release of Tenant............................ 15
16.3 Attorneys' Fees and Administrative Fees......... 16
16.4 Right to Collect Rent........................... 16
17. DEFAULTS; REMEDIES..................................... 16
17.1 Defaults........................................ 16
17.2 Remedies in Default............................. 16
17.3 Default by Landlord............................. 17
17.4 Late Charges.................................... 18
18. RIGHTS OF MORTGAGES.................................... 18
18.1 Subordination................................... 18
18.2 Mortgagee's Consent to Amendments............... 18
18.3 Mortgagee's Right to Cure....................... 18
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19. NOTICES................................................ 18
20. RELOCATION............................................. 18
21. QUIET POSSESSION....................................... 19
22. OPTIONS................................................ 19
23. LANDLORD'S LIEN........................................ 19
24. HAZARDOUS MATERIALS.................................... 19
25. GENERAL PROVISIONS..................................... 19
25.1 Estoppel Certificate............................ 19
25.2 Landlord's Interest and Liability............... 20
25.3 Severability.................................... 20
25.4 Interest Past Due Obligations; Certified Funds.. 20
25.5 Time of The Essence............................. 20
25.6 Captions........................................ 20
25.7 Entire Agreement................................ 20
25.8 Waivers......................................... 20
25.9 Recording....................................... 21
25.10 Determinations by Landlord...................... 21
25.11 Cumulative Remedies............................. 21
25.12 Covenants and Conditions........................ 21
25.13 Binding Effect Choice of Law.................... 21
25.14 Attorneys' Fees................................. 21
25.15 Landlord's Access............................... 21
25.16 Auctions........................................ 21
25.17 Merger.......................................... 21
25.18 Corporate Authority............................. 21
25.19 Signs........................................... 21
25.20 Brokers......................................... 21
25.21 Guarantor....................................... 21
25.22 Governing Law................................... 21
25.23 Joint and Several Liability..................... 22
25.24-25.27 Various Other Lease Provisions............ 22
EXHIBITS
Exhibit A - Legal Description
Exhibit B - Premises Site Plan
Exhibit C - Parking Addendum
Exhibit D - Rules and Regulations
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OFFICE LEASE
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This Lease, dated August 18, 1998 for reference purposes only, is made by
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and between 1330 Riverbend Investment Corp., (the "Landlord"), and CFData Corp.
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(the "Tenant").
1. CERTAIN LEASE PROVISIONS.
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The description and amounts set forth below are qualified by their usage
elsewhere in this Lease, including those Sections referred to in parentheses
following such descriptions:
1.1 Tenant's address and telephone number. (Section 19):
Tenant Name: CFData Corp.
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Doing Business As (DBA): CFData Corp.
Address: ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telephone: (____) _______________
1.2 Premises. (Section 2.1):
Building Name: Riverbend Park Suite No.: 600
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Address: ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
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1.3 Leased Area. (Section 2.1): l4.499 rentable sq. ft.
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1.4 Total Building Area. (Section 2.1): 40,331 rentable sq. ft.
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1.5 Tenant's Pro-Rate Share of Building Area. (Section 2.1): 35.95%
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1.6 Lease Term. (Section 3.1): Seventeen (17) months.
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1.7 Commencement Date. (Section 3.1): September 15, 1998.
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1.8 Expiration Date. (Section 3.1, 3.2): February 15, 2000.
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1.9 Base Rent for Lease Term. (Section 4.1): Total $267,023.25
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1.10 Base Rent, Monthly Installments. (Sections 4.1, 5.2): $15,707.25
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1.11 (a) Address of Landlord for rent payments. (Sections 4.1, 4.2):
1330 Riverbend Investment Corp., c/o Trinity Interests,
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▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
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(b) Address of Landlord for notices. (Sections 6.3, 19):
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1330 Riverbend Investment Corp., c/o Trinity Interests,
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▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
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with a copy to: ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
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▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
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(c) Address of Tenant for notices. (Sections 6.3, 19):
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
1.12 Geographic Area for CPI Calculation. (Section 5.2): Not Applicable
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1.13 Base Month for CPI Calculation. (Section 5.2): Not Applicable
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1.14 Landlord's Share of Operating Expenses. (Section 6.2): Base
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Year. 1998 (further defined as the total actual operating expenses
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for the 1998 calendar year)
1.15 Landlord's Share of Real Estate Taxes. (Section 6.2): Base
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Year. 1998 (further defined as the total actual real estate taxes
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for the 1998 tax year)
1.16 Security Deposit. (Section 7): $15,701,21
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1.17 Use. (Section 8.1): General Office
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1.18 Brokers. (Section 25.20): Cawlev International represented
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by ▇▇▇▇▇▇ Kaolan
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1.19 Addendum(s). (Sections 3.2. 4.3, 9.2, 22): The following
addendum(s) are attached to this Lease: Addendum "A" & "B"
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This Lease consists of 25 articles on _____ pages, plus Exhibits A, B, C &
D and ____ additional page(s) of Addendum(s).
LANDLORD:_______________________ TENANT:__________________________
1330 Riverbend Investment Corp. CF Data Corp.
By: ▇▇▇▇ ▇▇▇▇▇▇▇▇, President BY: ▇. ▇▇▇▇▇▇▇ Runner, President
DATE: ________________ DATE:___________________
2. PREMISES.
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2.1 Definition. Landlord hereby leases to Tenant and Tenant leases
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from Landlord for the term, at the rental, and upon all of the conditions set
forth herein, that certain real
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property known by suite number and address specified in Section 1.2 hereof,
consisting of the approximate amount of rentable square feet specified in
Section 1.3 hereof, and which is referred to herein as the Premises, Landlord
and Tenant each acknowledge that they have had the opportunity to measure the
Premises and each party agrees that the square footage set forth in Section 1.3
is hereby deemed to be correct, If the square footage set forth in Section 1.3
is later proven to be incorrect, each party hereto does hereby waive any claims
for damages due to the inconsistency. The Premises are located in an office
building presently consisting of approximately the total number of rentable
square feet specified in Section 1.4 hereof, which office building, the real
property on which it is situated (the legal description of which is attached
hereto as Exhibit A), and any parking facilities or structures appurtenant
thereto are hereinafter collectively referred to as the `Building". The Premises
are depicted in Exhibit B attached hereto and incorporated herein by this
reference, but the depiction of possible uses, tenants or locations on Exhibit B
shall not be construed to be a warranty or representation by Landlord that any
such uses, tenants or locations presently exist or will continue to exist.
Tenant's share of the total amount of square feet of the Building is equal to
the pro-rata share specified in Section 1.5 hereof, and said percentage shall
hereinafter be referred to as the Tenant's "Pro-Rata Share".
2.2 Public Areas. As long as this Lease remains in effect and Tenant is
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not in default hereunder, Tenant shall have the nonexclusive right, in common
with the Landlord, other tenants, subtenants and invitees, to use the public
areas of the Building which consist of the entrance foyer and lobby of the
Building, the common corridors on the floor of the Building on which the
Premises are situated and other areas appurtenant to or servicing the elevators,
shipping and receiving areas and lavatories in the Building, provided that
Landlord shall have the right at any time and from time to time to exclude
therefrom such areas as Landlord may determine so long as access to the Premises
is not unreasonably denied.
3. TERM.
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3.1 Term. The term of this Lease shall be the term specified in Section
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1.6 hereof, commencing on the Commencement Date specified in Section 1.7 hereof
and ending on the Expiration Date specified in Section 1.8 hereof unless sooner
terminated pursuant to any provision of this Lease.
3.2 Delay in Commencement. Notwithstanding said Commencement Date, if for
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any reason Landlord cannot deliver possession of the Premises to Tenant on said
date, Landlord shall not be subject to any liability therefor, nor shall such
failure affect the validity of this Lease or the obligations of Tenant
hereunder. However, in such case Tenant shall not be obligated to pay rent until
possession of the Premises is tendered to Tenant, which date shall be the new
Commencement Date, and the Expiration Date shall remain unchanged. Upon
Landlord's request, the parties agree to execute in writing an Addendum to
certify the Commencement Date and Expiration Date hereof, but this Lease shall
not be affected in any manner if either party falls or refuses to execute such
Addendum. Notwithstanding anything to the contrary contained herein, if Landlord
fails to deliver possession of the premises to Tenant on or before October 1,
1998 then Tenant shall have the option to terminate this Lease by giving written
notice of such termination prior to Landlord's delivering possession of the
Premises to Tenant, upon which Landlord shall return the Security Deposit and
any prepaid rent to Tenant and thereafter, neither party hereto shall have any
further obligation to the other.
3.3 Early Possession. In the event that Landlord shall permit Tenant to
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occupy the Premises prior to the Commencement Date, such occupancy shall be
subject to all of the
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provisions of this Lease and Tenant shall not be obligated to pay rental and all
other charges incurred under this Lease in addition to any obligations which
commence on the Commencement Date. Said early possession shall not advance the
Expiration Date of this Lease.
3.4 Delivery of Possession. Tenant shall be deemed to have taken
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possession of the Premises when the earliest of any of the following occur: (a)
two (2) business days after Landlord or Landlord's agent, architect or
contractor notifies Tenant that the Premises are ready for occupancy, or (b)
Tenant commences to occupy or otherwise make use of the Premises. If Tenant is
notified pursuant to Section 3.4(a), Tenant agrees to occupy the Premises within
twenty business days thereafter. As used in this Lease, "business days" shall
mean Mondays through Fridays. Tenant agrees that, upon the request of Landlord,
Tenant will execute a document certifying the date on which Tenant took
possession of the premises.
3.5 Holding Over. If Tenant remains in possession of the Premises or any
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part thereof after the expiration of the term hereof, such occupancy shall be a
tenancy from month to month at a monthly rental equal to 150% of the Base Rent
and Additional Rent payable hereunder. The foregoing provisions of this Section
3.5 shall neither be construed to give the Tenant any right to remain in
possession of the Premises or any part thereof after the expiration of the term
hereof nor to waive any of the Landlord's rights under this Lease to collect any
damages to which it may be entitled, whether direct or consequential.
4. RENT.
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4.1 Base Rent. The Base Rent for the Premises for the entire term of this
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Lease shall be as specified in Section 1.9, subject to adjustme nt pursuant to
the application of Section 3.2 relative to postponement of the installments
specified in Section 1.10, in advance, on the first day of each month of the
term hereof. Tenant shall pay Landlord upon the execution of this Lease the sum
specified in Section 1.10 as the installment of Base Rent for the first full
calendar month of the term of the Lease. Provided, however, that If the
Commencement Date does not occur on the first day of a month, the aforesaid
payment shall be for the initial thirty days of the Lease and the next monthly
installment of Base Rent shall be due on the first day of the first full
calendar month of the term but shall be prorated to cover only those days of
said calendar month not previously paid by the Tenant by its initial payment.
Base Rent for any period during the term hereof which is less than one calendar
month shall be a pro rata portion of the monthly installment based upon the
actual number of days the Lease is in effect during said calendar month. All
rents shall be payable in lawful money of the United States of America without
notice or demand and without any deduction, offset or abatement, and shall be
payable to Landlord at the address stated in Section 1.11(a) or to such other
persons or at such other places as Landlord may designate in writing. The
payment of Base Rent hereunder shall be an independent covenant.
4.2 Additional Rent. Both Tenant and Landlord expressly understand and
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agree that all other sums, excepting Base Rent as described in Section 4.1 and
5, which may from time to time become due under this Lease shall be deemed
Additional Rent. Additional Rent shall include, but not be limited to, late
charges, interest, Shared Expenses as described in Section 6, attorneys' fees,
security deposits and any cash bonds which may by circumstance be required to be
posted hereunder. Both Tenant and Landlord expressly understand and agree that
all monies paid by Tenant hereunder shall be first credited to Additional Rent
(and allocated among different items of Additional Rent as Landlord may
determine), and only then to Base Rent. All payments of Additional Rent shall be
in lawful money of the United States of America, shall be
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paid without any deduction, offset or abatement, and shall be payable to
Landlord at the address stated in Section 1.11(a) or to such other persons or at
such other places as Landlord may designate in writing. The obligation to make
payments of Additional Rent hereunder shall be an independent covenant.
4.3 Parking and Storage. Tenant agrees to pay to Landlord the amount of
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Additional Rent for parking as set forth in any Parking Addendum incorporated in
this Lease, and the amount of Additional Rent for storage as set forth in any
Storage Space Addendum incorporated in this Lease, in advance for each month on
the first day of each month of the term hereof. Unless Tenant executes a Parking
Addendum or Storage Space Addendum, Tenant shall have no right to use any
parking facilities or storage facilities of the Building, respectively.
4.4 Acceptance of Rental Payments. No acceptance by Landlord of a lesser
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sum than the Base Rent and/or Additional Rent then due shall be deemed to be
other than on account of the earliest amount of such rental due (unless Landlord
elects otherwise), nor shall any endorsement or statement on any check or any
letter accompanying any check or payment as rent be deemed an accord and
satisfaction or compromise and settlement, and Landlord may accept such check or
payment without prejudice to Landlord's right to recover the balance of such
payments due or to pursue any other remedy as provided in this Lease.
5. ESCALATIONS OF RENT.
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5.1 Determination. The monthly obligations for rental payments described
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in Sections 4.1 and 4.3 shall be increased annually in accordance with the
provisions of Section 5.2 below.
5.2 Indexing.
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(a) As used in this Section 5, the term "Index" shall mean the "Consumer
Price Index for all Urban Consumers (CPI-U)", All Items, 1967-100, published by
the Bureau of Labor Statistics of the United States Department of Labor, for the
geographical area specified in Section 12. If the Index shall hereafter be
converted to a different standard reference base than that used in the Base
Month specified in Section 1.13, the determination of the Percentage Increase
defined below shall be made by reference to such convention factor, formula or
table for converting the Index as may be published by the Bureau of Labor
Statistics, or if such Bureau shall not publish same, then by any nationally
recognized publisher of similar statistical information chosen by the Landlord.
If the Index shall cease to be published, there shall be substituted therefor a
price index (or a combination of illegible, with such adjustments as may be
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required to afford compatibility) published by the Bureau of Labor Statistics or
successor governmental agency which is intended to be representative of
substantially similar changes in the coat of living in the geographical area
specified in Section 1.12, an determined by the Landlord. The term "Base Index"
shall mean the Index most recently published as of the first day of the Base
Month specified in Section 1.13. The term "Anniversary Month" shall mean each
successive January thereafter during the term of this Lease. The term
"Percentage Increase" shall mean the percentage equal to the fraction, the
numerator of which shall be the Index most recently published as of the first
day of the month which is two months prior to the Anniversary Month less the
Base Index (but in no event shall the numerator be equal to or less than zero),
and the denominator of which shall be the Base Index.
(b) If the Index in an Anniversary Month shall exceed the Base Index, then
each monthly installment of Base Rent payable pursuant to Section 4.1 for the
calendar year during
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which such Anniversary Month occurs, and thereafter until a new comparative
statement is sent to Tenant, shall be increased by an amount which is computed
by multiplying the Percentage Increase by the amount of said monthly installment
specified in Section 1.10. In each calendar year after the year in which the
Commencement Date occurs, Landlord shall send to Tenant a comparative statement
setting forth the Index in the Anniversary Month, the Base Index, the Percentage
Increase, and the increase in the monthly rental installment, provided, however,
that Landlord's failure to provide a comparative statement at any particular
time shall not eliminate or reduce Tenant's obligation to pay increased rent
pursuant to this paragraph and shall not prejudice Landlord's right to provide a
comparative statement at any subsequent time. On the first day of the calendar
month ("current month") following the month In which the comparative statement
is sent, Tenant shall pay to Landlord a sum equal to the amount of said increase
in the rent multiplied by the number of calendar months of the Lease Term that
elapsed since January 1, and thereafter, commencing with the current month and
continuing monthly thereafter until a different comparative statement is sent to
Tenant, the monthly installment of rent pursuant to Section 4.1 shall be
increased by an amount equal to the amount of said increase. Rental payments due
under Section 4.3 shall be increased in the same manner and simultaneously with
any increase in the amount of installments of Base Rent. The expiration or
termination of this Lease during any calendar year for all or any part of which
there is an increase in the rent due as determined under this paragraph shall
not affect the rights or obligations of the parties respecting such increase,
and any comparative statement relating to such increase may, on a pro-rata
basis, be sent to Tenant subsequent to, and all such rights and obligations
shall survive, any such expiration or termination. No adjustments or
recomputations, retroactive or otherwise, shall be made to the computations of
installments of Base Rental owing hereunder in the event that the base Index or
Index in effect in any Anniversary Month is subsequently adjusted after the date
on which Landlord sends to Tenant the comparative statement which contains a
computation of the Percentage Increase based on the amounts of the Base Index
and Index in the applicable Anniversary Month then in effect.
6. SHARED EXPENSES
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6.1 Determination. The monthly obligations for Additional Rent as
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described in Section 4.2 shall be annually adjusted in accordance with the
provisions of Section 6.2 below and Addendum "A" to the Lease.
6.2 Escalations.
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(a) Landlord agrees to expend as its share of Operating Expenses paid for
and sustained by the Landlord during any calendar year en amount not greater
than that specified in Section 1.14. Said sum shall constitute the maximum
payable by Landlord as its contribution toward Operating Expenses. The term
"Operating Expense" means the total amounts paid or payable, whether by the
Landlord or otherwise on behalf of the Landlord, in connection with the
ownership, leasing, management, maintenance, repair and operation of the
Building, other than those expenses described in Section 6.2(b). Operating
Expense shall include, without limiting the generality of the foregoing, the
aggregate of the amount paid for heating, air conditioning, and providing
electricity and water and sewer charges to the Building, other than that paid by
individual tenants, the amount paid to any persons or entities for all labor
and/or wages (including the cost to Landlord of workmen's compensation and
disability insurance, payroll taxes, welfare and fringe benefits), for services
rendered, and materials provided to the Building; administrative expenses
related to the Building; any costs incurred for any capital improvements or
structural repairs to the Building to effect labor savings or otherwise reduce
Operating Expenses, or required by law or by any governmental or quasi-
governmental authority having
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jurisdiction over the Building, which coats shall be amortized over the useful
life of the applicable capital improvements or structural repairs; the cost of
accounting services necessary to compute the rent and charges payable by tenants
of the Building; fees for management, legal, accounting, inspection and
consulting services pertaining to the Building; the cost of guards and other
protection services; and the amount paid for premiums for all insurance procured
by Landlord to insure the Building as may be required or permitted under this
Lease (including, without limitation, business interruption insurance, and if
there is a mortgage or deed of trust on the Building, such insurance as may be
required by the holder of such mortgage or deed of trust). Notwithstanding the
foregoing, Operating Expenses shall not include the costs of special services
rendered to tenants (including Tenant) for which a special or separate charge is
made, any costs of preparation of space for new tenants in the Building, any
costs borne directly by Tenant under this Lease, leasing commissions,
depreciation or interest payments, or debt service payments made to a mortgagee.
(b) Landlord agrees to expend as its share of Real Estate Taxes paid for
and sustained by the Landlord during any calendar year an amount not greater
than that specified in Section 1.15. Said sum shall constitute the maximum
payable by Landlord as its contribution toward Real Estate Taxes. Real Estate
Taxes shall include general and special taxes, assessments, duties and levies,
charged and levied upon or assessed against the Building and/or any improvement
situated on the real property on which the Building stands, any leasehold
improvement, fixtures, installations, additions and equipment used in the
maintenance or operation of the Building, whether owned by Landlord or Tenant,
not paid directly by the Tenant. Further, if at any time during the term of this
Lease, the method of taxation of real estate prevailing at the time of execution
hereof shall be or has been altered so as to cause the whole or any part of the
taxes now or hereafter levied, assessed or imposed on real estate so be levied,
assessed or imposed upon Landlord, wholly or partially, as a capital levy or
otherwise, or on, or measured by the rents received from the Building, then such
new or altered taxes attributable to the Premises shall be deemed to be included
within the term "Real Estate Taxes" for purposes of this paragraph. The
reference to "Building" in this subparagraph shall include, as allocated by the
Landlord, improvements or facilities utilized in common by the Building and
other buildings upon or adjacent to the real property on which the Building
stands.
(c) Commencing on the first day of the first January after the
Commencement Date, and continuing thereafter during the term of this Lease,
Tenant shall pay to Landlord monthly in advance on the first day of each month,
without notice or demand and without any deduction, offset or abatement, in
lawful money of the United States of America, 1/12 of the amount of the Tenant's
Pro-Rata Share of the Shared Expenses as estimated by Landlord to be incurred
for the calendar year in which the monthly payments are to be made. If the
Expiration Date is not December 31, the monthly payments owing hereunder during
the last partial calendar year of the Lease shall be appropriately adjusted. For
the period from the Commencement Date to December 31 in the same calendar year,
Tenant shall not pay estimated Shared Expenses but shall be obligated for its
actual Pro-Rata Share of Shared Expenses for said period upon receipt of
Landlord's Statement described below. The term "Shared Expenses" shall mean the
amount by which Operating Expenses and Real Estate Taxes incurred in any period
exceed the amount of Landlord's obligation for the same as specified in Section
1.14 and 1.15.
(d) In each calendar year after the year in which the Commencement Date
occurs, Landlord shall send to Tenant a Landlord's Statement which shall set
forth the actual amount of Shared Expenses, with the exception of those States
in which real estate taxes are billed on other than a calendar year basis, in
that event Landlord's statement of Real Estate Taxes will be based on the Real
Estate Tax Fiscal Year and sent within a reasonable time after receipt of
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Real Estate Tax Statements, and Tenant's Pro-Rate Share thereof for the
preceding calendar year or portion thereof and the estimated amount of Shared
Expenses and Tenant's Pro-Rata Share thereof for the calendar year in which the
Landlord's Statement is given. Landlord's failure to render a Landlord's
Statement with respect to any period shall not eliminate or reduce Tenant's
obligation to pay Shared Expenses and shall not prejudice Landlord's right to
render a Landlord's Statement with respect to any subsequent period. The
obligations of Tenant under the provisions of this paragraph with respect to any
increase in rent shall survive the expiration or any sooner termination of the
term of the Lease. Within 15 days next following the notification by Landlord of
the contents of its Landlord's Statement, Tenant shall pay to Landlord the
entire amount of Tenant's Pro-Rate Share of actual Shared Expenses for the prior
period covered by the Landlord's Statement less the amount of Shared Expenses
actually paid by Tenant for said period, plus Tenant shall also then pay to
Landlord such amount as is necessary to assure than, through the calendar month
in which the Landlord's Statement is given, the Tenant has paid to Landlord the
full amount of estimated Shared Expenses for the calendar year in which
Landlord's Statement is given, as if the Landlord's Statement were given on
January 1 of said calendar year. For each month following for the remainder of
said calendar year, Tenant shall pay the monthly estimated Shared Expenses set
forth in the Landlord's Statement. In the event that the estimated payments made
by the Tenant in the calendar year preceding the date on which the Tenant is
given notice of the Landlord's Statement exceed the Tenant's Pro-Rats Share of
actual Shared Expenses for such calendar year, then should the Tenant not be
otherwise in default hereunder, the amount of such excess shall be applied by
the Landlord to the next succeeding installments of monthly estimated payments
of Shared Expenses.
6.3 Statements. Nothing in this Lease shall be construed to require
----------
Landlord to render the statements described in Sections 5.2 and 6.2
simultaneously or in any particular order. All reasonable determinations by
Landlord pursuant to Section 6 shall be presumed to be correct. Until Tenant is
advised of the adjustment in its obligation to pay Shared Expenses, if any,
pursuant to the provisions of Section 6.2, Tenant's monthly rental shall
continue to be paid at the then current rent (including all prior adjustments
thereto pursuant to this Lease). Upon written notice to Landlord of not less
than fifteen business days, Tenant shall have the right to review the
documentation relied upon by Landlord relating to the computation of Shared
Expenses, which review shall occur at the location specified in Section 1.11(b).
All Shared Expenses shall be computed on the actual basis. In computing Shared
Expenses, no cost or expense may be accounted more than once, any expenses which
are paid by the proceeds of insurance shall be excluded, and any expenses which
are separately metered or billed directly to and separately paid by any other
tenant shall be excluded. Tenant shall have the right to cause an audit to be
made of Landlord's computation of Shared Expenses, at the location of the
Corporate Office in Dallas, Texas, at Tenant's sole expense, not more frequently
than once per calendar year. Tenant shall not be entitled to withhold or deduct
any portion of Base Rent or Additional Rent during the pendency of any such
audit. Any errors disclosed by such audit shall be promptly corrected, provided
that Landlord shall have the right to cause another independent audit so be made
of such computations, and in the event of a disagreement between the auditors,
the audit disclosing the least amount of deviation from Landlord's original
computations shall be conclusively deemed to be correct.
7. SECURITY DEPOSIT.
----------------
Tenant shall deposit with Landlord upon execution hereof the sum specified
in Section 1.16 as security for Tenant's faithful performance of Tenant's
obligations hereunder. If Tenant fails to pay rent or other charges due
hereunder, or otherwise defaults with respect to
12
any provisions of this Lease, Landlord may without notice to Tenant use, apply
or retain all or any portion of said deposit for the payment of any rent or
other charge in default or for the payment of any other sum (including, but not
limited to attorney's feet) to which Landlord may become obligated by reason of
Tenant's default or to compensate Landlord for any loss or damage which Landlord
may suffer thereby. If Landlord so uses or applies all or any portion of said
deposit, Tenant shall within five (5) days after written demand therefor deposit
cash with Landlord in an amount sufficient to restore said deposit to the full
amount hereinabove stated. Landlord shall not be required to keep said deposit
separate from its general accounts and Tenant shall not be entitled to interest
on such deposit. If Tenant performs all of Tenant's obligations hereunder, said
deposit or so much thereof as had not theretofore been applied by Landlord,
shall be returned, without payment of interest or other increment for its use,
to Tenant (or, at Landlord's option, to the last assignee, if any, of the
Tenant's interest hereunder) within sixty (60) days after either the expiration
of the term hereof (or any extension thereof) or after Tenant has vacated the
Premises, whichever is later. Landlord shall deliver the funds deposited herein
by Tenant to the purchaser of the Building in the event the Building is sold (or
give such purchaser a credit against the purchase price in the amount of such
deposit), and thereupon Landlord shall be discharged from all further liability
with respect to such deposit. If Tenant shall default under this Lease more than
two (2) times in any twelve (12) month period, irrespective of whether or not
such default is cured, then the security deposit shall, within ten (10) days
after demand by Landlord, be increased by Tenant to an amount equal to the
greater of: (i) three (3) times the amount specified in Article 1.16; (ii) three
(3) months' fixed rent; or (iii) as may be otherwise required by Landlord.
Tenant may not encumber or place liens upon the security deposit while in
Landlord's possession.
8. USE.
---
8.1 Use. The Premises shall be used and occupied only for the uses
---
specified in Section 1.17 hereof, provided that the foregoing shall not be
construed as e representation or guarantee by the Landlord that such business
may lawfully be conducted on the Premises.
8.2 Compliance With Law. In the event it is determined by the applicable
-------------------
governmental unit that the Premises violates any building code, regulation or
ordinance, then it shall be the obligation of the Landlord, after written notice
from Tenant which includes a copy of the governmental unit's determination, to
promptly, at Landlord's sole cost and expense, rectify any such violation. In
the event Tenant does not give to Landlord written notice of any such violation
within thirty (30) days from the date on which Tenant takes possession of the
Premises, it shall be conclusively deemed that such violation, unless such is
latent, did not exist and the correction of the same shall be the obligation and
expense of the Tenant at the direction of the Landlord, provided, however, that
nothing in this Section shall be construed to require or permit the Tenant to
make any structural changes to the Building not caused by Tenant's improvements
or the nature of Tenant's occupancy of the Premises.
8.3 Waste and Nuisance. Tenant shall not commit, suffer or permit any
------------------
waste, damage, disfiguration or injury to the Premises, the common areas in the
Building, or the fixtures and equipment located therein or thereon except for
normal wear and tear. Tenant shall not permit or suffer any overloading of the
floors thereof, and shall not place therein any heavy business machinery, safes,
computers, data processing machines, or other items heavier than customarily
used for general office purposes without first obtaining the written consent of
Landlord. Tenant shall not use or permit to be used any part of the Building for
any dangerous, noxious or offensive trade or business, and shall not cause or
permit any nuisance, noise, action, or disturbance of other tenants, in, at or
on the Premises.
13
8.4 Conditions of Premises. Except as provided in Section 8.2, Tenant
----------------------
hereby accepts the Premises in their condition existing as of the date of the
commencement hereof, subject to all applicable zoning, municipal, county and
state laws, ordinances and regulations governing and regulating the use of the
Premises, and accepts this Lease subject thereto and to all matters disclosed
thereby and by any exhibits attached hereto. In addition, except as provided in
Section 8.2, Tenant shall at Tenant's expense, comply promptly with all
applicable laws, statutes, ordinances, rules, regulations, orders, restrictions
of record, and requirements in effect during the term or any part of the term
hereof regulating the use by Tenant of the Premises.
8.5 Insurance Cancellation. Notwithstanding the provisions of Section 8.2
----------------------
hereinabove, no use shall be made or permitted to be made of the Premises, nor
acts done which will cause the cancellation of any insurance policy covering
said Premises or the Building, and if Tenant's use of the Premises causes an
increase in said insurance rates, Tenant shall pay any such increase as
Additional Rent, which, together with interest on any amount paid therefor by
Landlord, shall be payable by Tenant on the next succeeding date on which a Base
Rental payment is due.
8.6 Landlord's Rules and Regulations. Tenant shall faithfully observe and
--------------------------------
comply with the reasonable rules and regulations that Landlord shall from time
to time promulgate, including without limitation any rules and regulations
attached to this Lease, which are hereby incorporated wherein by this reference.
Landlord reserves the right from time to time to make all reasonable
modifications to said rules and regulations. The additions and modification to
those rules and regulations shall be binding upon Tenant upon Landlord giving
notice of them to Tenant. Landlord shall not be responsible to Tenant for the
nonperformance of any of said rules and regulations by any other tenants or
occupants.
9. LANDLORD'S SERVICES.
-------------------
9.1 Basic Services. Subject to any law, rule or governmental order or
--------------
regulation, and further subject to any circumstance beyond the control of the
Landlord, Landlord shall furnish the following services:
(a) Air conditioning and heat, whichever be required, twenty four hours a
day, seven days a week, excluding legal holidays. Landlord shall regulate the
air temperature as required and Tenant shall not have the tight to modify or
control the air temperature of the premises or the building. Notwithstanding
that Landlord alone shall control the air temperature, at all times the air
shall be at temperature and humidity levels reasonable and customary for
comparable buildings;
(b) Hot and cold water for lavatory purposes and electric current for
lighting the Premises and for ordinary office appliances and office machines
only, provided that Tenant shall not use any electrical equipment which in
Landlord's opinion will overload the wiring insulations or interfere with the
use thereof by Landlord or any other tenant in the Building. If a further supply
of water is required by Tenant, then at Tenant's expense, Landlord shall have
the option to install and maintain a water meter to register such consumption,
and Tenant shall pay as Additional Rent for water consumed, at the cost to
Landlord, and for sewer rents and all other rents and charges based upon such
consumption of water;
(c) General day-to-day janitorial service (excluding carpet shampooing and
hard surface floor waxing) five days a week, and elevator service during the
same hours fur which air
14
conditioning and heat services are provided as set forth above, provided,
however, that in the event Tenant is delinquent in making any installment
payment of rent under this Lease for a period of 15 days or more after it shall
become due, Landlord may discontinue furnishing any or all of the services
described in this Section 9 until all arrears of rental payments, plus interest
and late charges and any other sums due under this Lease, shall have been paid
in hill. Whenever heat generating machines or equipment are used by Tenant in
the Premises which affect the temperature otherwise maintained by the air
conditioning system, as determined by Landlord, Landlord reserves the right to
install supplementary air conditioning units in the Premises, and the costs
therefor, including the cost of installation, operation and maintenance thereof,
shall be paid by Tenant to Landlord upon demand by Landlord. If Tenant, as
determined by Landlord, requires electric current in excess of that usually
furnished or supplied to the Premises, Landlord may, at its election, either
cause an electric current meter to be installed in the Premises so as to measure
the electric current consumed for such excess use or determine the value of such
excess use by causing an independent electrical engineer or consulting firm,
selected by Landlord, to conduct a survey of Tenant's use of electric current
and to certify such determination in writing to Landlord and Tenant. The cost of
any such meter or survey, as the case may be, and of the installation,
maintenance or survey, as the cause may be indicates such excess use by Tenant
of electric current, Tenant agrees to pay to Landlord, as Additional Rent,
promptly upon demand therefor by Landlord, the amount determined to be due for
the electric current consumed by Tenant, as shown by said meter or as indicated
in said survey, as the ease may be, at the rate charged for such service by the
local public authority or the local public utility, as the case may he,
furnishing the same, plus any additional expenses incurred by Landlord in
keeping account of the electric current consumed.
(d) Notwithstanding anything in this Lease to the contrary, Tenant will
not without the prior written consent of Landlord use any apparatus or device in
the Premises which will in any way increase the amount of electricity or water
usually furnished or supplied for use of the Premises as general office space.
Tenant shall not connect with any electric current except through existing
electrical outlets in the Premises, or to any water pipes, any apparatus or
device for the purposes of using electric current or water. If Tenant shall
require water or electric current in excess of that usually furnished or
supplied for use of the Premises, Tenant must first procure the written consent
of Landlord to the use thereof. With the prior written consent of Landlord,
Tenant may maintain and operate data processing equipment on the Premises, but
all additional costs in connection therewith (including, but not limited to,
additional support flooring, insulation, electrical outlets and temperature
maintenance facilities) shall be borne solely by Tenant and the utility services
utilized by or for such equipment shall be separately metered and the cost of
such utility services with metering shall be borne solely by Tenant. At Tenant's
request and with Landlord's prior approval, Landlord shall furnish the services
described in this Section at times other than specified in Section 9.1 (a),
provided that Tenant shall pay the entire cost thereof as reasonably determined
by Landlord as Additional Rent, notwithstanding the fact that such services may
also benefit portions of the Building other than the Premises (in which event
Landlord shall not receive collectively from all tenants paying for any portion
of such additional services more than the actual cost to Landlord of providing
the same).
9.2 Initial Construction. Landlord agrees to perform the work and make
--------------------
such installations in the Premises as set forth in the Work Letter Addendum
which, if attached hereto as indicated in Section 1.19, constitutes additional
provisions of this Lease which are hereby incorporated by reference. Tenant
acknowledges that it will examine the Premises before taking possession
hereunder and agrees that unless Tenant furnishes Landlord with a notice in
writing specifying any apparent defect in the construction within twenty
business days after such
15
taking of possession pursuant to Section 3.4, it shall be conclusively deemed
that Tenant has examined the Premises and that the same were in good order and
that Landlord had satisfactorily completed the work it agreed to perform. Tenant
agrees that there is no promise, representation, or undertaking by or binding
upon Landlord with respect to any construction, alteration, remodeling or
redecorating in or to the Premises except as expressly set forth in the Work
Letter Addendum.
9.3 Interruption of Services. Landlord reserves the right from time to
------------------------
time to install, use, maintain, repair, replace and relocate for service to the
Premises and other parts of the Building, and to alter or relocate any other
facility in the Building. Interruption or curtailment of any service maintained
in the Building, if caused by strikes, mechanical difficulties, actions of the
Landlord under the first sentence of this Section 9.3, or for any other reason
beyond Landlord's control, shall not entitle Tenant to any claim against
Landlord or to any abatement in rent, nor shall the same constitute constructive
or partial eviction. Unless due to the gross negligence of Landlord, Landlord
shall not be liable to Tenant for any injury or damage resulting from defects in
the plumbing, heating, or electrical systems in the Building or for any damage
resulting from water seepage into the Building or for any act or failure to act
by any other Tenants at the Building or for any damage resulting from wind
storm, hurricane or rain storm. Landlord shall not be liable for disruption of
heating, air conditioning, plumbing or electrical services if Landlord uses
reasonable efforts to restore such services in a timely manner.
10. MAINTENANCE, REPAIRS AND ALTERATIONS.
------------------------------------
10.1 Landlord's Obligations. Subject to the provisions of Sections 8.2
----------------------
and 14, and except for damage caused by any negligent or intentional act or
omission of Tenant, Tenant's agents, employees, representatives, customers or
invitees, in which event Tenant shall repair the damage, at its sole expense,
Landlord shall keep in good order, condition and repair the structural portions
of the Building and those portions of the Building which are not occupied or
leased by any tenant, and all costs incurred by Landlord in making any such
repairs or performing such maintenance shall be Operating Expenses as defined in
Section 6.2, provided that Landlord shall have no obligation to perform any act
which is the obligation of Tenant or any other tenant in the Building. Tenant
expressly waives the benefits of any statute now or hereafter in effect which
would otherwise afford Tenant the right to make repairs at Landlord's expense or
to terminate this Lease because of Landlord's failure to keep the Premises in
good order, condition and repair. Other than as specifically provided in this
Section 10.1, Landlord shall not be obligated to make any repairs or
improvements of any kind, in, upon, about, or to the Premises or the Building.
10.2 Tenants Obligations. Subject to the provisions of Sections 8.2 and
-------------------
14, Tenant, at Tenant's expense, shall keep in good order, condition and repair
the Premises and every part thereof including, without limiting the generality
of the foregoing, all plumbing, electrical and lighting facilities and equipment
within the Premises, fixtures, interior walls and interior surfaces of exterior
walls, ceilings, windows, doors, plate glass located within the Premises. All
repairs made by the Tenant shall be at least of the same quality, design and
class as that of the original work. Tenant agrees that it will abide by, keep
and observe all reasonable rules and regulations which Landlord may make from
time to time for the management, safety, care and cleanliness of the Building
and grounds, the parking of vehicles and the preservation of good order therein
as well as for the convenience of other occupants and tenants of the Building.
All damage or injury to the Building or to the Premises, fixtures, appurtenances
and/or equipment caused by the Tenant moving property in or out of the Building
or the Premises or by Tenant's installation or removal of furniture, fixtures,
or other property, or from any other cause of any kind or nature
16
whatsoever due to carelessness, omission, neglect, improper conduct, or other
cause of the Tenant, its agents, employees, invitees, contractors or
subcontractors shall be repaired, restored, or replaced promptly by the Tenant
at its sole coat and expense to the satisfaction of the Landlord. In the event
that the Tenant falls to keep the Premises in good order, condition and repair
while this Lease remains in effect, then as soon as possible after written
demand (which written demand shall not be required in the case of an emergency),
Landlord may restore the Premises to such good order and condition and make such
repairs without liability to Tenant for any loss or damage that may accrue to
Tenant's property or business by reason thereof, and upon completion thereof
Tenant shall pay to Landlord upon demand and as Additional Rent the cost of
restoring the Premises to such good order and condition, together with interest
thereon from the date paid. Notwithstanding Tenant's obligation to maintain the
aforementioned items, Landlord shall, at Tenant's request, perform minor
maintenance within the premises including for example replacing light bulbs and
ballasts or repairing door hardware.
10.3 Surrender. On the last day of the term hereof or on any sooner
---------
termination or date on which Tenant ceases to possess the Premises, Tenant shall
surrender the Premises to Landlord in good and clean condition, ordinary wear
and tear excepted. Prior to such surrender Tenant shall repair any damage to the
Premises occasioned by its removal of trade fixtures, furnishings and equipment,
which repair shall include the patching and filling of holes and repair of
structural damage. Tenant agrees to indemnify Landlord and hold Landlord
harmless from and against any liability (including reasonable attorneys' fees)
of Landlord to third parties resulting from Tenant's failure to timely comply
with the provisions of this Section 10.3.
10.4 Alterations and Additions.
-------------------------
(a) Tenant shall not, without Landlord's prior written consent, make any
alterations, improvements or additions (referred to collectively herein as
"Alterations") in, on or about the Premises. Landlord may require that Tenant
remove any or all of said Alterations at the expiration of the term or such
other time at which Tenant ceases to possess the Premises, and restore the
Premises to their prior condition. Should Tenant make any Alterations without
the prior approval of the Landlord, Landlord may require that Tenant immediately
remove any or all of such items and/or Landlord may declare a default by Tenant
under this Lease. Except in connection with normal interior decorating of the
Premises, Tenant shall not place any holes in any part of the Premises, and in
no event shall Tenant place any exterior or interior signs or interior drapes,
blinds, or similar items visible from the outside of the Premises without the
prior written approval of Landlord. Landlord shall, at its sole cost, list
Tenant in the directory of tenants for the building.
(b) Any Alterations in, on or about the Premises that Tenant shall desire
to make shall be presented to Landlord in written form with proposed detailed
plans. If Landlord shall give its consent, the consent shall be deemed
conditioned upon Tenant acquiring a permit to do the work from appropriate
governmental agencies, the furnishing of a copy thereof to Landlord prior to the
commencement of the work and the compliance by Tenant with all conditions of
said permit and with all specifications in the plans in a prompt and expeditious
manner. Tenant shall not permit any of the work to be performed by persons not
currently licensed under any applicable licensing laws or regulations pertaining
to the types of work to be performed. Landlord shall not be deemed unreasonable
in the exercise of its discretion for withholding approval of any Alterations.
For any Alterations which involve or might affect any structural or exterior
element of the Building, any area or element outside of the Premises, or any
facility serving any area of the Building outside of the Premises, or which will
require unusual expense to re-adapt the Premises to normal office use on the
termination or expiration of the Lease,
17
unless in the latter case Tenant either desires to or is required to make
repairs or Alterations in accordance with this Lease, Landlord may require
Tenant, at Tenant's sole cost and expense, to obtain and provide to Landlord a
lien and completion bond (or such other applicable bond as determined by
Landlord) in an amount equal to one and one-half (1-1/2) times the estimated
coat of such improvements, to insure Landlord against liability including but
not limited to liability for mechanic's and materialmen's liens and to insure
completion of the world.
(c) Tenant shall pay, when due, all claims for labor or materials
furnished or alleged to have been furnished to or for Tenant at or for use in
the Premises, which claims are or may be secured by any mechanic's or
materialmen's lien against the Premises or the Building. Tenant shall give
Landlord not less than ten (10) days notice prior to the commencement of any
work in, on or about the Premises, and Landlord shall have the right to post
notices of non-responsibility in, on or about the Premises as provided by law.
Tenant shall have no power or authority to do any act or make any contract which
may create or be the basis for any lien upon the interest of the Landlord, the
Premises or the Building, or any portion thereof. If any mechanics or other lien
or any notice of intention to file alien shall be filed or delivered with
respect to the Premises or the Building, based upon any act of the Tenant or of
anyone claiming through the Tenant, or based upon work performed or materials
supplied allegedly for the Tenant, Tenant shall cause the same to be canceled
and discharged of record within fifteen (15) days after the filing or delivery
thereof. If Tenant has not so canceled the lien within fifteen (15) days as
required herein, Landlord may pay such amount, and the amount so paid together
with interest thereon from the date of payment and all legal costs and charges,
including attorneys' fees, incurred by Landlord in connection with said payment
and cancellation of the lien or notice of intent shall be Additional Rent and
shall be payable on the next succeeding date on which a Base Rental installment
is due. Landlord may, at its option and without waiving any of its rights set
forth in the immediately preceding sentence, permit Tenant to contest the
validity of any such lien or claim, provided that in such circumstances the
Tenant shall at its expense defend itself and Landlord against the same and
shall pay and satisfy any such adverse judgment that may be rendered thereon
before the enforcement thereof against the Landlord, the Premises or the
Building, provided further that Landlord may at any time require the Tenant to
deposit with the court exercising jurisdiction over such claim, such amount as
may be necessary under applicable statutes to cause the release and discharge of
the lien, and if Tenant shall not immediately make such payment upon the request
of Landlord, Landlord may make said payment and the amount so paid, together
with interest thereon from the date of payment and all legal costs and charges,
including attorneys' fees, incurred by Landlord in connection with said payment
shall be deemed Additional Rent and shall be payable on the next succeeding date
on which a Base Rental installment is due. In addition, Landlord may require
Tenant to pay Landlord's attorney fees and costs in participating in such action
if Landlord shall decide it is in its best interest to do so. Nothing herein
contained shall be construed as a consent on the part of Landlord to subject the
interest and estate of Landlord to liability under any lien law of the state in
which the Premises are situated, for any reason or purpose whatsoever, it being
expressly understood that Landlord's interest and estate shall not be subject to
such liability and that no person shall have any right to assert any such lien.
(d) Unless Landlord requires their removal, as set forth in Section
10.4(a), all Alterations which may be made on the Premises shall, at the
expiration of the term or such other time at which Tenant ceases to possess the
Premises, become the property of Landlord and remain upon and be surrendered
with the Premises. Notwithstanding the provisions of this Section 10.4(d),
Tenant's machinery and equipment, other than that which is affixed to the
Premises so that it cannot be removed without material damage to the Premises,
shall remain the property of Tenant and may be removed by Tenant subject to the
provisions of Section 10.3
18
hereof and provided further that Tenant is not in default under this Lease at
the time Tenant ceases to possess the Premises.
11. TENANT'S USE OF PUBLIC AREAS.
----------------------------
Tenant's non-exclusive use of the public areas described in Section 2.2
shall be subject to such Reasonable Rules and Regulations promulgated by
Landlord pursuant to Section 8.6. Tenant agrees to repair at its coat all
deteriorations or damages to the public areas occasioned by Its negligence or
intentional misconduct or that of its officers, agents, representatives,
customers, employees or invitees. Landlord shall have the unrestricted right to
remodel, renovate or change the size and/or configuration of the common areas
without the consent of Tenant.
12. TAXES AND TELEPHONE.
-------------------
12.1 Personal Property Taxes. Tenant shall pay prior to delinquency all
-----------------------
taxes assessed against and levied upon leasehold improvements, fixtures,
furnishings, equipment and all other personal property of Tenant contained in
the Premises or elsewhere. If tenant shall cause said leasehold improvements,
trade fixtures, furnishings, equipment and all other personal property to be
assessed with Landlord's real property, Tenant shall pay Landlord the taxes
attributable to Tenant within (10) days after receipt of a written notice from
Landlord setting forth the taxes applicable to Tenant's property, and if Tenant
fails to do so, Landlord may make such payment and the amount so paid, together
with interest thereon from the date paid, shall be Additional Rent and shall be
due and payable to Landlord on the next succeeding date on which a Base Rental
installment is due.
12.2 Evidence of Payment. Tenant shall promptly deliver to Landlord, upon
-------------------
Landlord's written request, receipts for payments of all taxes, charges, rates,
dues, assessments and licenses in respect of all improvements, equipment and
facilities of the Tenant on or in the Premises which were due and payable within
a period up to one year prior to Landlord's making such request.
12.3 Telephone. Tenant shall separately arrange and pay for the
---------
furnishing of and use of all telephone services as Tenant may deem necessary for
its use of the Premises, and Landlord shall have no liability in connection
therewith.
13. INSURANCE AND INDEMNITY.
-----------------------
13.1 Liability Insurance. Tenant shall, at Tenant's expense, obtain and
keep in force during the term of this Lease a policy of bodily injury and
property damage insurance, insuring Landlord and Tenant against any liability
arising out of the ownership, use, occupancy or maintenance of the Premises and
all areas appurtenant thereto. Such insurance shall be in an amount not less
than $500,000 per person, $500,000 per occurrence for bodily injury, and
$500,000 for property damage, or $1,500,000 combined single limit for said
items. The limits of said insurance shall not, however, limit the liability of
Tenant hereunder. Tenant shall also obtain and keep in force during the term of
this Lease, at Tenant's expense, "all risk" or "special coverage form" insurance
upon the property of every description and kind owned by the Tenant and located
in the Building or for which Tenant is legally liable or installed by or on
behalf of the Tenant, including without limitation, furniture, fittings,
installations, alternations, additions, partitions, fixtures and anything in the
nature of leasehold improvements in an amount not less than 80% of the full
replacement coat thereof. Such insurance shall insure the Tenant and
19
Landlord, and in the event that there shall be a dispute as to the amount which
comprises the full replacement cost, the decision of the Landlord shall be
conclusive, if Tenant shall fail to procure and maintain the insurance required
hereunder, Landlord may but shall not be required to procure and maintain the
same, and any amount so paid by Landlord for such insurance shall be Additional
Rent which, together with interest thereon from the date paid, shall be due and
payable by Tenant on the next succeeding date on which a Base Rental installment
is due. If in the opinion of Landlord the amount of liability insurance required
hereunder is not adequate, then not more frequently than once during each
option, extension or renewal teens of this Lease, if any, Tenant shall increase
said insurance coverage as required by Landlord. Provided, however, that in no
event shall the amount of the liability insurance increase by more than fifty
percent of the amount of the insurance during the preceding term of this Lease.
However, the failure of Landlord to require any additional insurance coverage
shall not be deemed to relieve Tenant from any obligations under this Lease.
13.2 Property Insurance. Landlord shall obtain and keep in force during
------------------
the term of this Lease fire and extended coverage on the Building (including
Building standard leasehold improvements). Landlord may also, but shall not be
required to, procure any other insurance policies respecting the Premises or
Building which Landlord deems necessary.
13.3 Insurance Policies. Insurance required by Tenant hereunder shall be
------------------
in companies rated A+, AAA or better in "Best's Insurance Guide". Tenant shall
deliver to Landlord prior to taking possession of the Premises copies of
policies of such insurance or certificates evidencing the existence and amounts
of such insurance with loss payable clauses reasonably satisfactory to Landlord.
No such policy shall be cancelable or subject to reduction of coverage or other
modification except after ten (10) days' prior written notice to Landlord.
Tenant shall, within ten (10) days prior to the expiration of such policies,
furnish Landlord with renewals thereof, or Landlord may order such insurance and
charge the coat thereof to Tenant, which amount, together with interest thereon,
shall be Additional Rent and shall be payable by Tenant on the next succeeding
date on which a Base Rental payment is due. Tenant shall not do or permit to be
done anything which shall invalidate the insurance policies referred to in
Section 13.1. Tenant shall forthwith, upon Landlord's demand, reimburse Landlord
for any additional premiums attributable to any act or omission or operation of
Tenant causing an increase in the cost of insurance.
13.4 Waiver of Subrogation. As long as their respective insurers so
---------------------
permit, Tenant and Landlord each waives any and at rights of recovery against
the other, or against the officers, employees, agents and representatives of the
other for loss or damage to such waiving party or its property or the property
of others under its control, where such loss or damage is insured against under
any insurance policy in force at the time of such loss or damage. Tenant and
Landlord shall, upon obtaining the policies of insurance required hereunder,
give notice to the insurance carriers that the foregoing mutual waiver of
subrogation is contained in this Lease and obtain policies of insurance, if
obtainable, which shall include a waiver by the insurer of all right of
subrogation against Landlord or Tenant in connection with any loss or damage
thereby insured against.
13.5 Hold Harmless. Tenant shall each indemnify, defend and hold Landlord
-------------
harmless from any and all claims, liabilities, damages and coats, including
attorneys' fees, incurred by Landlord which arise from Tenant's use of the
Premises or the Building or from the conduct of its business or from any
activity, work or things which may be permitted or suffered by Tenant in, on or
about the Premises or the Building, and shall further indemnify, defend and hold
Landlord harmless from and against any and all claims, liabilities, damages and
costs,
20
including attorneys' fees, incurred by Landlord which arise from any breach or
default in the performance of any obligation on Tenant's part to be performed
under any provision of this Lease or which arise from any negligence of Tenant
or any of its agents, representatives, customers, employees or invitees.
Landlord shall likewise indemnify Tenant for any claims, liabilities, damages
and costs, including attorney's fees, incurred by Tenant as a result of
Landlord's negligence or willful misconduct.
13.6 Exemption of Landlord from Liability. Tenant hereby agrees that
------------------------------------
Landlord shall not be liable for injury to Tenant's business or any loss of
income therefrom, including without limitation from any relocation by Landlord
of Tenant within the Building (except as expressly provided otherwise in Section
20), or for damage to the goods, wares, merchandise or other property of Tenant,
Tenant's employees, representatives, agents, invitees, customers or any other
person in, on or about the Premises or Building, nor shall Landlord be liable
for injury to the person of Tenant, Tenant's employees, representatives, agents,
customers, or invitees, whether any such damage or injury is caused by or
results from fire, steam, electricity, gas, water or rain, or from the breakage,
leakage, obstruction or other defects of pipes, sprinklers, wires, appliances,
plumbing, air conditioning or lighting fixtures, or from any other cause, and
whether the said damage or injury results from conditions arising upon the
Premises or any other cause, and whether the said damage or injury results from
conditions arising upon the Premises or Building, or from other sources or
places, and regardless of whether the cause of such injury or the means of
repairing the same is inaccessible to Landlord or Tenant, unless such injury,
loss of income or damage is caused by the Landlord's gross negligence. Landlord
shall not be liable for any damages arising from any act or neglect of any other
tenant, if any, of the Building. Tenant hereby assumes all risk of damage to
property or injury to persons in, on or about the Premises or the Building from
any cause and Tenant hereby waives all claims in respect thereof against
Landlord, excepting where said damage arises out of the gross negligence of
Landlord.
14. DAMAGE OR DESTRUCTION.
---------------------
14.1 Option to Terminate Lease. If the Premises or any part thereof shall
-------------------------
be damaged or destroyed by fire or other casualty, the Landlord may, at its
option and subject to Section 14.2 hereinbelow, elect to terminate this Lease by
giving notice to the Tenant within ninety (90) days after Landlord receives
actual notice of the fire or other casualty, and thereupon the term of this
Lease shall expire by lapse of time upon the tenth day after such notice is
given. Instead of exercising said option, Landlord may elect to repair or
restore the Premises to the same condition as existed before such damage or
destruction. Upon electing to repair or restore, Landlord may proceed with
reasonable dispatch to perform the necessary work, and the Base Rent to be paid
until such work is completed shall be abated in proportion of the Premises being
unusable for a period equal to one day or less, but Landlord shall not be liable
to Tenant for any delay which arises by reason of labor strikes, adjustments of
insurance or any other cause beyond Landlord's control, and in no event shall
Landlord be liable for any loss of profits or income. Notwithstanding the
foregoing, there shall be no abatement, apportionment or reduction in the rental
obligations of Tenant if the damage or destruction is caused by the Tenant or
Tenant's agents, representatives, employees, customers or invitees.
14.2 Obligation to Repair or Restore. If and only if all of the following
-------------------------------
circumstances exist with respect to damage or destruction to the Premises,
Landlord may not elect to terminate the Lease as provided in Section 14.1 hereof
but rather must elect to repair or restore the Premises:
21
(a) There is no fault or neglect on the part of the Tenant, Tenant's
agents, representatives, employees, customers or invitees which contributed to
the damage or destruction;
(b) The damage or destruction to the Premises is less than fifty percent
(50%) of the replacement cost thereof as determined by Landlord;
(c) The Landlord is fully insured for the casualty which causes the damage
or destruction and the insurance proceeds have been made available therefor by
the holder or holders of any mortgages or deeds of trust covering the Premises;
(d) The date of the damage or destruction is more than six (6) months
prior to the Expiration Date of this Lease or any renewal, modification or
extension thereof; and
(e) Less than sixty percent (60%) of the rentable square feet of the
Building is so damaged or destroyed, as determined by Landlord, regardless of
the percentage of rentable square feet of the Premises which may be damaged or
destroyed.
14.3 Fault of Tenant. Landlord may exercise its option to repair or
---------------
restore as described in Section 14.1 even if such damage or destruction is due
to the fault or neglect of Tenant, Tenant's agents, representatives, employees,
customers or invitees, but in such event Landlord's election to repair or
restore shall be without prejudice to any other rights and remedies of Landlord
under this Lease, and there shall be no apportionment or abatement of any rent
of any kind and Landlord shall not be liable for any other loss to Tenant of any
nature whatsoever.
14.4 Obligations of Tenant. Except as provided in this ▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇
---------------------
of Tenant's obligations under this Lease shall be affected by any damage or
destruction of the Premises by any cause whatsoever. Tenant hereby expressly
waives any and all rights it might otherwise have under any law, regulation or
statute which would act to modify the provisions of the immediately preceding
sentence.
14.5 Termination by Tenant. In the event that more than sixty percent
---------------------
(60%) of rentable square feet of the Premises shall be damaged or destroyed by
fire or other casualty not caused by the Tenant or Tenant's agents or if such,
representatives, employees, customers or invitees, either party may terminate
this Lease by giving notice to the other within thirty (30) business days after
the date of the fire or other casualty, and upon such termination the rental
obligations of the Tenant shall be duly apportioned as of the date of such fire
or other casualty. If the repair of the damage, destruction or other casualty
not caused by the Tenant or Tenant's agents, representatives, employees,
customers or invitees cannot reasonably be completed within ninety (90) days or
if the date such damage, destruction or casualty occurs is within the last six
(6) month's of the lease, Tenant may terminate the lease by giving Landlord
written notice, which notice shall be effective thereupon. Tenant shall have no
right to terminate the Lease under this Section 14.5 if Tenant is in default of
any of its obligations under the Lease as of the date of the fire or other
casualty.
15. CONDEMNATION.
------------
If the Premises are taken under any public or private power of eminent
domain, or sold by Landlord under the threat of the exercise of said power (all
of which is herein referred to as "condemnation"), or if any portion of the
Building is so condemned so that it would not be
22
practical, in Landlord's judgment, to continue to maintain the Building, this
Lease shall terminate as of the date of the condemning authority takes title or
possession, whichever occurs first. If only a portion of the Premises are so
condemned, Landlord or Tenant shall have the right, if more than thirty percent
(30%) of rentable square feet of the Premises are so condemned, to terminate
this Lease as of the date the condemning authority takes title or possession,
whichever occurs first, by giving written notice of such termination to the
other party not later than thirty (30) days after said date, but should the
parties hereto elect not to so terminate this Lease, the Lease shall remain in
full force and effect as to the portion of the Premises not so taken, and
Tenant's rental obligations shall be reduced proportionately to reflect the
number of rentable square feet remaining in the Premises, and such rental
reduction, if any, shall take effect as of the date which is thirty (30) days
after the date of which the condemning authority takes title or possession,
whichever first occurs. If repairs or restorations to that portion of the
Premises not so taken are deemed necessary by Landlord to render such portion
reasonably suitable for the purposes for which it was leased, as determined by
Landlord, Landlord shall perform such work at its own cost and expense but in no
event shall Landlord be required to expend any amount greater than the amount
received by Landlord as compensation for the portion of the Premises taken by
the condemnator. All awards for the taking of any part of the Premises or any
payment made under the threat of the exercise of power of eminent domain shall
be the property of Landlord, whether made as compensation for diminution of
value of the leasehold or for the taking of the fee or as severance damages. No
award for any partial or entire taking shall be apportioned, and Tenant hereby
assigns to Landlord any award which may be made in such taking or condemnation,
together with any and all sights of Tenant now or hereafter arising in or to the
same or any part thereof, except that any award or other compensation made for
any taking is subject to the rights of the first mortgagee up to the amount of
its lien and of any junior mortgagee, as may be permitted by the first
mortgagee, up to the full amount of such junior lien; provided, however, that
Tenant shall be entitled to any award for loss of or damage to Tenant's trade
fixtures and removable personal property and/or for the interruption of or
damage to Tenant's business.
16. ASSIGNMENT AND SUBLETTING.
-------------------------
16.1 Landlord's Consent Required. Tenant shall not voluntarily or by
---------------------------
operation of law assign, transfer, mortgage, sublet or otherwise transfer or
encumber all or any part of Tenant's interest in this Lease or in the Premises
without Landlord's prior written consent which shall not, be unreasonably
withheld or delayed. Any attempted assignment, transfer, mortgage, encumbrance
or subletting without such consent shall be void and shall constitute a breach
of the Lease. Any transfer of Tenant's interest in this Lease or in the Premises
from Tenant by merger, consolidation or liquidation, or by any subsequent change
in the ownership of fifty percent (50%) or more of the capital stock of Tenant
shall be deemed a prohibited assignment within the meaning of this Section 16.
As a condition of obtaining Landlord's consent, Tenant shall submit to Landlord
together with its request for consent the name of the proposed assignee or
subtenant, the terms and provisions of the proposed transaction, and such
information as to the nature of the proposed assignee's or subtenant's business
and its financial responsibility and standing as Landlord may reasonably
require, together with the effective date of the proposed transfer which shall
be at least sixty (60) days after the date of submission of such information to
Landlord. Landlord's failure to consent to any proposed transfer under this
Section shall not be deemed unreasonably withheld if (a) the occupancy resulting
from such transfer will not be consistent with the general character of the
business carried on by the tenants of the Building or violates any rights or
options held by any other tenant of the building; or (b) the proposed occupant
pursuant to the transfer does not have the financial strength and stability to
perform its rental obligations or Landlord is unable to obtain guaranties from
one or
23
more affiliates of the proposed occupant in order to secure such financial
obligations; or (c) any proposed sublease does not incorporate this Lease in its
entirety so as to be subject to this Lease's terms, or any such sublease does
not require the sublessee to attorn to Landlord at Landlord's option in the
event of a default by Tenant under this Lease; or (d) if Tenant does not execute
an agreement with Landlord requiring Tenant to pay to Landlord, as Additional
Rent, one hundred percent (100%) of all moneys or other consideration received
by Tenant from its transferee (whether paid to Tenant as consideration for
Tenant's transfer of property or other assets to the transferee or as
consideration for the transferee's occupancy of the Premises) in excess of the
amounts owed by Tenant to Landlord under this Lease, which Additional Rent shall
be paid to Landlord as and when received by Tenant. Tenant may not sublet or
assign any or all of the premises to another tenant of the building or its
affiliated companies.
16.2 No Release of Tenant. Regardless of Landlord's consent, no
--------------------
subletting or assignment or other transfer described in Section 16.1 shall
release Tenant of Tenant's obligation or alter the primary liability of Tenant
to pay the rent and to perform all other obligations to be performed by Tenant
hereunder. Consent to one assignment, subletting or other transfer shall not be
deemed consent to any subsequent act. In the event of default by any assignee of
Tenant or any successor of Tenant in the performance of any of the terms hereof,
Landlord may proceed directly against Tenant without the necessity of exhausting
remedies against said assignee or successor. Landlord may consent to subsequent
assignments, subletting, or transfers of this Lease or amendments or
modifications to this Lease with assignees or successors of Tenant without
notifying Tenant and without obtaining its consent thereto and such action shall
not relieve Tenant of liability under this Lease. In the event Landlord allows
assignment or subletting hereunder, neither Tenant, the assignee of Tenant, or
the sublessee of Tenant shall have any option to extend the term of this Lease
even if such option is otherwise granted to Tenant herein and notwithstanding
the provisions of any such option granted to Tenant herein, and all rights and
options to extend this Lease otherwise granted to Tenant shall be deemed
terminated and canceled as of the date of such assignment, subletting or other
transfer. Notwithstanding anything in this Lease to the contrary, Landlord shall
have no obligation to grant consent to any transfer as defined in Section 16.1
if Tenant is in default under this Lease at the time the request for consent is
made or at any time thereafter through the effective date of the transfer. In
addition, Tenant acknowledges that its intent in executing this Lease is to
occupy the Premises and not to make speculative usage of the Premises, and
therefore Landlord shall have no obligation whatsoever to consent to any
proposed transfer if the rentals payable by the proposed occupant to the Tenant
are less than the rentals sought to be received by the Landlord for vacant apace
in the Building as of the date on which the Tenant is requesting the Landlord's
consent to the transfer. In the event that Tenant proposes to assign this Lease
or to sublet all of the Premises, Landlord shall have the right, exercisable by
notice in writing after receipt of the request by Tenant, to terminate this
Lease in which case the lease shall terminate thirty (30) days following such
notice as though such date had been the Expiration Date as set forth 1,8.
16.3 Attorneys' Fees and Administrative Fees. In the event Tenant shall
---------------------------------------
request the consent of Landlord to any assignment, subletting or transfer or if
Tenant shall request the consent of Landlord for any other act which Tenant
proposes to do under any other provision of this Lease, then Tenant shall pay
Landlord's attorneys' fees incurred in connection with the consideration or
evaluation of such request. In addition thereto, in the event that Landlord
shall consent to a sublease, assignment or transfer under Section 16.1, Tenant
shall pay Landlord administrative fees of Two Hundred Dollars ($200) incurred in
connection with giving such consent.
24
16.4 Right to Collect Rent. The acceptance of rent by Landlord from any
---------------------
person other than Tenant shall not be deemed to be a waiver by Landlord of any
provision of this Lease. If the Premises are sublet or occupied by anyone other
than Tenant and Tenant is in default hereunder, or this Lease is assigned by
Tenant, then, in any such event, Landlord may collect rent from the assignee,
subtenant or occupant and apply the net amount collected to the rent reserved in
this Lease, but no such collection shall be deemed a waiver of the covenant in
this Lease against assignment and subletting or the acceptance of such assignee,
subtenant or occupant as tenant, or a release of Tenant from further performance
of the covenants contained in this Lease.
17. DEFAULTS; REMEDIES.
------------------
17.1 Defaults. The occurrence of any one or more of the following events
--------
shall constitute a default and breach of this Lease by Tenant:
(a) The vacating or abandonment of the Premises by Tenant; or
(b) The failure by Tenant to make any payment of Base Rent, Additional
Rent or any other payment required to be made by Tenant hereunder, as and when
due, where such failure shall continue for a period of five (5) days; or
(c) The failure by Tenant to observe or perform any of the covenants,
conditions or provisions of this Lease to be observed or performed by Tenant,
other than described in paragraph (b) above, where such failure shall continue
for a period of five (5) business days after written notice thereof from
Landlord to Tenant; provided, however, that if the nature of Tenant's default as
determined by Landlord is such that more than five (5) business days are
reasonably required for its cure, then Tenant shall not be deemed to be in
default if Tenant commences such cure as soon as possible within said five (5)
business day period and thereafter diligently prosecutes such cure to
completion, and in any case completes said cure within thirty (30) business days
after the aforesaid written notice or
(d) (i) The insolvency of the Tenant or the execution by the Tenant of an
assignment for the benefit of creditors, or the convening by Tenant of a meeting
of its creditors, or any class thereof, for the purposes of effecting a
moratorium upon or extension or composition of its debts; or the failure of the
Tenant to generally pay its debts as they mature; or (ii) the filing by or for
reorganization or arrangement under any law relating to bankruptcy (unless in
the case of a petition filed against Tenant, the same is dismissed within sixty
(60) days); or (iii) the appointment of a trustee or receiver to take possession
of substantially ad of Tenant's assets located at the Premises or of Tenant's
interest in this Lease, where possession is not restored to Tenant within thirty
(30) days; or (iv) the attachment, execution or other judicial seizure of
substantially all of Tenant's assets located at the Premises or of Tenant's
interest in this Lease, where such seizure is not discharged within thirty (30)
days.
17.2 Remedies in Default.
--------------------
(a) In the event of any such default or breach by Tenant, Landlord shall
have the right at any time thereafter, with or without notice or demand and
without limiting Landlord in the exercise of any right or remedy which Landlord
may otherwise have by reason of such default or breach, to terminate this Lease
at its option or to re-enter and at its option to attempt to re-let without
terminating this Lease and remove ad persons and property from the Premises,
using any force as may reasonably be necessary to accomplish said purposes, all
without service of
25
notice or resort to legal process and without being deemed guilty of trespass or
forcible entry or becoming liable for any loss or damage which may be occasioned
thereby.
(b) If Tenant shall fail to remove any effects which it is entitled to
remove from the Premises upon the termination of this Lease, or any extension or
renewal hereof, or upon a re-entry by Landlord for any cause whatsoever, or upon
Tenant's ceasing to possess the Premises for any reason, the Landlord, at its
option, may remove the same and store or dispose of the said effects without
liability for loss or damage thereto, and Tenant agrees to pay to Landlord on
demand any and all expenses incurred in such removal, including Court costs,
attorneys' fees, storage and insurance charges on such effects for any length of
time the same shall be in Landlord's possession; or the Landlord, at its option,
without notice, may sell such effects, or any of them, at private or public sale
and without legal process, for such price or consideration as the Landlord may
obtain, and apply the proceeds of such sale upon any amounts due under this
Lease from the Tenant to the Landlord, and upon the expenses incidental to the
removing, cleaning the Premises, selling said effects, and any other expense,
rendering the surplus, if any, to the Tenant; provided, however, in the event
the proceeds of such sale or sales are insufficient to reimburse the Landlord,
Tenant shall pay such deficiency upon demand. Tenant acknowledges and agrees
that any such disposition of Tenant's property in the above-described manner by
the Landlord shall be deemed to be commercially reasonable and that no bailment
shall be created by Landlord's exercise of any of its rights under this
subparagraph (b).
(c) Should Landlord elect to re-enter, as herein provided, or should it
take possession pursuant to legal proceedings, or pursuant to any notice
provided for by law, it may make such alterations, additions, improvements and
repairs as may be necessary in order to re-let the Premises, and may but need
not re-let the Premises or any part thereof for such term or terms (which may be
for a term extending beyond the term of this Lease) and at such rental or
rentals and upon such other terms and conditions as Landlord may determine to be
advisable; upon each such re-letting all rentals received by the Landlord; shall
be applied i) first to the payment of any costs and expenses of such re-letting,
including brokerage fees and attorney's fees and the cost of such alterations,
additions, improvements and repairs; ii) second, to the payment of Base Rent due
and unpaid hereunder, and the residue, if any, shall be held by Landlord and
applied in payment of future rent as the same may become due and payable
hereunder provided that Tenant shall have no tight to claim any interest in all
or any portion of said residue and if the rent and other charges paid or to be
paid to Landlord by any new tenant pursuant to any re-letting exceed the
monetary obligations of Tenant, Tenant shall have no right to claim any interest
in ad or any portion of said excess. If such rental received from such re-
letting during any month be less than that to be paid during the month by Tenant
hereunder, Tenant shall pay any such deficiency to Landlord, and such deficiency
shall be calculated and paid monthly on the date on which the rent would have
been payable hereunder if possession had not been retaken. If, during the
existing term of this Lease, the premises covered thereby include other premises
not part of the Premises, a fair apportionment of the rent received from such
re-letting and the expenses incurred in connection therewith as provided
aforesaid will be made in determining the net proceeds from such re-letting and
the expenses incurred in connection therewith as provided aforesaid will be made
in determining the net proceeds from such re-letting, and any rent concessions
will be equally apportioned over the term of the new lease. Landlord shall in no
event be liable in any way whatsoever for failure to re-let the Premises for any
reason, or in the event the Premises are re-let, for failure to collect the rent
thereof under such re-letting. No such reentry or taking possession of the
Premises by Landlord, nor any acts pursuant thereto, shall be construed as an
election on its part to terminate this Lease unless a written notice of such
termination be given to Tenant by Landlord. No notice from Landlord under this
Lease or under any applicable forcible entry and detainer or
26
eviction statue or similar law shall constitute an election by Landlord to
terminate this Lease unless such notice specifically so states. Notwithstanding
any such re-letting without termination, Landlord may at any time thereafter
elect to terminate this Lease for such previous breach.
(d) Should Landlord at any time terminate this Lease for any default or
breach, in addition to any other remedies it may have, it may recover from
Tenant all damages it may incur by reason of such default or breach, including
the cost of recovering the Premises and reasonable attorneys' fees. If such
termination is caused by the failure to pay rent and/or the abandonment of any
substantial portion of the premises, Landlord may elect, by sending written
notice thereof to Tenant, to receive liquidated damages in an amount equal to
twelve times the security deposit as set forth in section 1.16 hereunder.
Notwithstanding the preceding, nothing shall prevent the Landlord from proving
damages in excess of the amount referred to above; and
(e) Each of the remedies set forth hereinabove in this Section 17 shall
not be exclusive, but rather shall be considered cumulative with any other legal
or equitable remedy now or hereafter available to Landlord under the laws or
judicial decisions of the state in which the Premises are located. To the extent
such waiver is permitted by law, the parties waive trial by jury in any action
or proceeding brought in connection with this Lease. Suit or suits for the
recovery of the amount of damages set forth hereinabove may be brought by
Landlord, from time to time, at Landlord's election, and nothing herein shall be
deemed to require Landlord to await the date whereon this Lease or the term
hereof would have expired had there been no event of default. Nothing contained
in this Lease shall limit or prejudice the right of Landlord to prove and obtain
as liquidated damages in any bankruptcy, insolvency, receivership,
reorganization or dissolution proceeding an amount equal to the maximum allowed
by any statue or rule of law governing such proceeding and in effect at the time
when such damages are to be proved, whether or not such amount be greater, equal
to or less than the amounts recoverable, either as damages or rent, referred to
in any of the preceding provisions of this Section.
17.3 Default by Landlord. Landlord shall not be in default unless
-------------------
Landlord fails to perform obligations required of Landlord within thirty (30)
days after written notice by Tenant to Landlord and to the holder of any first
mortgage or deed of trust covering the Premises, specifying the manner in which
Landlord has failed to perform such obligation; provided however, that if the
nature of Landlord's obligation is such that more than thirty (30) days are
required for performance as determined by Landlord, then Landlord shall not be
in default if Landlord commences performance within such thirty day period and
thereafter diligently prosecutes the same to completion; provided further that
Landlord's obligation to perform any act under this Lease shall be excused for
any period of time during which Landlord is prevented from performing because of
any circumstance beyond Landlord's control. Tenant's remedies upon Landlord's
default are further limited by Section 18.3 and 25.2 below.
17.4 Late Charges. Tenant hereby acknowledges that late payment by Tenant
------------
to Landlord of rent and other sums due hereunder will cause Landlord to incur
costs not contemplated by this Lease, the exact amount of which will be
extremely difficult to ascertain. Such costs include, but are not limited to,
processing and accounting charges, and late charges which may be imposed on
Landlord by the terms of any mortgage or trust deed covering the Premises.
Accordingly, if any installment of Base Rent, Additional Rent or any other sum
due from Tenant shall not be received by Landlord or Landlord's designee within
ten (10) days after paid amount is due, then Tenant shall immediately pay to
Landlord a late charge equal to five
27
percent (5%) of such over due amount or the sum of One Hundred Dollars
($100.00), whichever is greater. The parties hereby agree that such late charge
represents a fair and reasonable estimate of the cost Landlord will incur by
reason of late payment by Tenant and is in addition to interest due under
Section 25.4. Acceptance of such late charge by Landlord shall in no event
constitute a waiver of Tenant's default with respect to such overdue amount, or
prevent Landlord from exercising any of the other rights and remedies granted
hereunder.
18. RIGHTS OF MORTGAGES.
-------------------
18.1 Subordination. As used throughout this Section 18, the term
-------------
"mortgagee" shall refer to the holder of a Mortgage or deed of trust or ground
lease affecting the Premises. This Lease and the tights of Tenant hereunder
shall be and are hereby made subject and subordinate to the provisions of any
ground lease, mortgage or deed of trust affecting the Premises, and to each
advance made or hereafter to be made under the same, and to ad renewals,
modifications, consolidations and extensions thereof and ad substitutions
therefor. This Section 18 shall be self-operative and no further instrument of
subordination shall be required. However, in confirmation of the provisions of
this Section 18, Tenant shall execute and deliver promptly any certification or
instrument that Landlord or any mortgagee may request, and failing to do so
within ten (10) days after written demand, Tenant does hereby make, constitute
and irrevocably appoint Landlord as Tenant's attorney-in-fact and Tenant's name,
place and stead, to do so, and/or Landlord may declare this Lease to be in
default. If any mortgagee or ground lessor shall elect to have this Lease prior
to the lien of its mortgage, deed of trust or ground lease, and shall give
written notice thereof to Tenant, this Lease shall be deemed prior to such
mortgage, deed of trust or ground lease, whether this Lease is dated prior or
subsequent to the date of said mortgage, deed of trust or ground lease or the
date of recording thereof. Tenant shall and does hereby agree to attorn to any
mortgagee or successor in title and to recognize such mortgagee or successor as
its Landlord in the event any such person or entity succeeds to the interest of
Landlord. Notwithstanding any other provision of this Lease, in the event that
any mortgagee or its respective successor in title shall succeed to the interest
or Landlord hereunder, the liability of such mortgagee or successor shall exist
only so long as it is the owner of the Building, or any interest therein, or is
the tenant under said ground lease.
18.2 Mortgagee's Consent to Amendments. No assignment of this Lease and
---------------------------------
no agreement to make or accept any surrender, termination or cancellation of
this Lease and no agreement to modify so as to reduce the rent, change the term,
or otherwise materially change the rights of Landlord under this Lease, or to
relieve Tenant of any obligation or liability under this Lease, shall be valid
unless consented to by Landlord's mortgagees of record, if such is required by
the mortgagees, in writing. No Base Rent, Additional Rent, or any other charge
(with the exception of the security deposit described in this Lease) shall be
paid more than ten (10) days prior to the due date thereof and payments made in
violation of this provision (except to the extent that such payments are
actually received by a mortgagee) shall be a nullity as against any such
mortgagees of record, and Tenant shall be liable for the amount of such payments
to such mortgagees.
18.3 Mortgagee's Right to Cure. No act or failure to act on the part of
-------------------------
Landlord which would entitle Tenant under the terms of this Lease, or by law, to
be relieved of Tenant's obligations hereunder or to terminate this Lease, shall
result in a release or termination of such obligations or termination of this
Lease unless (a) Tenant shall have first given written notice of Landlord's act
of failure to act to Landlord's mortgagees of record, if any, specifying the act
or failure to act on the part of Landlord which could or would give basis to
Tenant's rights; and
28
(b) such mortgagees, after receipt of such notice, have failed or refused to
correct or cure the condition complained of within a reasonable time thereafter,
provided that nothing contained in this Section shall be deemed to impose any
obligation on any such mortgagees to correct or cure any condition. As used
herein, a "reasonable time" includes a reasonable time to obtain title to the
mortgaged premises if the mortgagee elects to do so and a reasonable time to
correct or cure the condition if such condition is determined to exist, but in
no event less than 120 days from the date of the mortgagees' receipt of the
above described notice.
19. NOTICES.
-------
Except as provided in Section 17.1(b) and 22, whenever under this lease
provision demand is made for any notice or declaration of any kind, or where it
is deemed desirable or necessary by either party to give or serve any such
notice, demand or declaration to the other party, it shall be in writing and
served either personally with written acknowledgement of receipt obtained by
deliverer or sent by certified United States mail, return receipt requested,
postage prepaid, addressed either to the address set forth in Section 1.1 or
1.11(b), or to such other address as may be given by a party to the other by
proper notice hereunder, or, in the case of notices to the Tenant, to the
Premises. The date of personal delivery (as evidenced by such evidence of
service as provided for in said rules) or the date on which the certified mail
is deposited with the United States Postal Service shall be the date on which
any proper notice hereunder shall be deemed given. Landlord shall not be
required at any time to deliver any specific notice to more than two notice
addresses.
20. RELOCATION.
----------
Tenant agrees that Landlord may relocate Tenant to other space in the
Building containing substantially the same amount of rentable square feet as is
contained in the Premises, provided that the actual cost of physically
relocating Tenant (excluding any and all consequential or other costs to Tenant)
and the cost of altering the new space to make it comparable to the Premises is
borne by the Landlord; provided, however, that Landlord may not exercise said
right to relocate Tenant if the Premises consist of more than ten percent (10%)
of the rentable square feet in the Building. In addition, Landlord shall pay
costs incurred by Tenant as a result of the relocation, including without
limitation costs incurred in changing addresses on stationery, business cards,
directories, advertising and other such items, but in no event shall Landlord's
obligation to pay cost imposed in this sentence exceed the sum of $500. In the
event that the new Premises in which the Tenant is relocated does not consist of
the identical number of rentable square feet as specified in Section 1.3, the
parties shall execute an instrument specifying the new number of square feet in
the Premises and the change in the number of square feet contained in the
Premises shall be deemed effective as of the date on which the Tenant occupies
the new premises in which it is relocated.
21. QUIET POSSESSION.
----------------
Upon Tenant paying the sums due hereunder and observing and performing all
of the covenants, conditions and provisions on Tenant's part to be observed and
performed hereunder, Tenant shall have quiet possession of the Premises for the
entire term hereof subject to all of the provisions of this Lease.
29
22. OPTIONS.
-------
In the event that the Tenant, by addendum attached to this Lease, is
expressly given an option to renew or extend the term of this Lease, or any
option to purchase the Premises or Building or any right of first refusal to
purchase the Premises or other property of Landlord, then each of such options
and rights are personal to Tenant and may not be exercised by or assigned,
voluntarily or involuntarily, by or to anyone other than Tenant. No such option
described hereinabove may be exercised by the Tenant except In strict accordance
with the terms and provisions of the option and provided that Tenant is not in
default under this Lease either at the time Tenant gives notice of its intent to
exercise the option or at the time at which the option is to be exercised.
Notwithstanding the provisions of Section 19, notice of exercise of any option
shall be deemed given only when actually received by Landlord.
23. LANDLORD'S LIEN.
---------------
Tenant hereby grants to Landlord a lien upon and security interest in all
furniture, fixtures, equipment, inventory, merchandise and other personal
property belonging to the Tenant and located in, on or about the Premises or
Building at any time while this Lease is in effect, whether such items are
presently owned by Tenant or are after acquired, to secure the payment of all
Base Rent, Additional Rent and other charges due and to become due under this
Lease and to further secure the faithful performance of all of the other
obligations of this Lease required to be performed by Tenant, said lien to be
prior to any other lien on such property except a lien in favor of the seller or
lessor of such property to secure the unpaid purchase price or lease payments
thereof. All exemption laws are hereby expressly waived by Tenant. This lien
and security interest may be foreclosed in the same manner as a Financing
Statement under the version of the Uniform Commercial Code enacted in the state
in which the Premises are situated, or pursuant to any similar law so enacted if
a version of the Uniform Commercial Code is not in effect, and the filing of
this Lease in accordance with said law shall constitute full lawful notice of
this lien. In lien of filing this Lease or in addition thereto, Landlord may
require Tenant at any time to execute a Financing Statement, Security Agreement
or any other similar documents required by the laws of the state in which the
Premises are situated to perfect this lien and security interest, and Tenant
shall immediately execute the same upon the demand of Landlord. In the event
Tenant fails or refuses to do so within ten (10) days after written demand,
Tenant does hereby make, constitute and irrevocably appoint Landlord as Tenant's
attorney-in-fact in Tenant's name, place and stead, to do so, and/or Landlord
may declare this Lease to be in default.
24. HAZARDOUS MATERIALS.
-------------------
Tenant covenants not to introduce any hazardous or toxic materials onto the
Building, the Premises, or the grounds surrounding the Building, without (a)
first obtaining Landlord's written consent and (b) complying with all applicable
federal, state and local laws or ordinances pertaining to the transportation,
storage, use or disposal of such materials, including but not limited to
obtaining proper permits.
If Tenant's transportation, storage, use or disposal of hazardous or toxic
materials on the Building, the Premises, or the grounds surrounding the Building
results in (1) contamination of the soil or the surface or ground water or (2)
loss or damage to person(s) or property, then Tenant agrees to respond in
accordance with the following paragraph:
30
Tenant agrees (i) to notify Landlord Immediately of any contamination,
claim of contamination, loss or damage, (ii) after consultation and approval by
Landlord, to clean up and (iii) to indemnify, defend and hold Landlord harmless
from and against any claims, suits, causes of action, costs and fees, including
attorney's fees, arising from or connected with any such contamination, claim of
contamination, loss or damage. This provision shall survive the termination of
this Lease.
25. GENERAL PROVISIONS.
------------------
25.1 Estoppel Certificate.
--------------------
(a) Tenant shall at any time upon not less than ten (10) days prior
written notice from Landlord, execute, acknowledge and deliver to Landlord a
statement in writing: (i) certifying that this Lease is unmodified and in full
force and effect (or, if modified, stating the nature of such modification,
identifying the instruments of modification and certifying that this Lease, as
so modified, is in full force and effect), and the date to which the Base Rent,
security deposit, Additional Rent and other charges are paid in advance, if any,
and (ii) acknowledging that there are not, to Tenant's knowledge, any uncured
defaults on the part of Landlord hereunder, or specifying such defaults, if any,
which are claimed. Additionally, if required, Tenant shall affirming any or ad
of the following: a) that the lease is in full force and effect; b) whether
tenant has renewal or other options; c) whether Tenant is currently in
possession of and paying full rent on the premises; d) that the Tenant's rent is
not prepaid by more than one month's base rental amount; e) whether Tenant is
currently, or has in the past, received any rental concessions or abatements; f)
that tenant knows of no defaults by either the Landlord or Tenant; g) that
Tenant is not Solvent or contemplating bankruptcy or has been threatened with
involuntary bankruptcy proceedings. Any such statement may be conclusively
relied upon by any prospective purchaser, encumbrance or other transferee of the
Premises.
(b) Tenant's failure to deliver such statement within such time shall be
conclusive upon Tenant: (i) that this Lease is in full force and effect, without
modification except as may be represented by Landlord, (ii) that there are no
uncured defaults in Landlord's performance, and (iii) that no rent has been paid
in advance; and
(c) If Landlord desires to finance or refinance the Premises or the
Building, or any part thereof, Tenant hereby agrees to deliver to Landlord
and/or to any lender designated by Landlord such financial records of Tenant as
may reasonably required by such lender. Such statements may include but not be
limited to the past three (3) years' financial statements of Tenant. All such
financial statements shall be received by Landlord in confidence and shall be
used only for the purposes herein set forth.
25.2 Landlord's Interest and Liability. The term Landlord as used herein
---------------------------------
shall mean only the owner or owners at the time in question of the fee title or
a tenant's interest in a ground lease of the real property on which the
improvements comprising the Building are situated. In the event of any transfer
of such title or interest, Landlord herein named (and in case of any subsequent
transfers the then grantor), shall be relieved from and after the date of such
transfer of all liability as respects Landlord's obligations thereafter to be
performed, provided that any funds in the hands of Landlord or the then grantor
at the time of such transfer in which Tenant has an interest shall be delivered
to the grantee. The obligations contained in this Lease to be performed by
Landlord shall, except as aforesaid, be binding on Landlord's successors and
assigns only during their respective periods of ownership. Anything to the
contrary elsewhere in this Lease notwithstanding, Tenant shall look solely to
the estate and property of the Landlord in
31
the Building for the satisfaction of the Tenant's remedies for the collection of
a judgment (or other judicial process) requiring the payment of money by the
Landlord in the event of any default or breach by the Landlord with respect to
any of the terms, covenants and conditions of the Lease to be observed and/or
performed by the Landlord, and no other property or assets of the Landlord shall
be subject to levy, execution or other enforcement procedure fur the
satisfaction of the Tenant's remedies.
25.3 Severability. The invalidity of any provision of this Lease, as
------------
determined by a court of competent jurisdiction, shall in no way affect the
validity of any other provision hereof.
25.4 Interest Past Due Obligations; Certified Funds. Except as may
----------------------------------------------
expressly be provided in this Lease to the contrary, any amount due to Landlord
not paid when due shall hear interest at the rate of four percent (4%) per annum
greater than the prime rate of the First City Bank of Dallas, Texas as the same
may fluctuate from and after the date on which the payment was first due through
the date on which the payment is paid in full, provided, however, that the
payment of such interest shall in no event exceed the highest rate allowed under
applicable law. Payment of such interest shall not excuse or cure any default by
Tenant under this Lease. In the event that either Tenant is more than ten (10)
days late in making any payment due under the Lease, or any payment from Tenant
to Landlord does not clear the bank or is returned for insufficient funds, and
either such condition occurs on two or more occasions, or each occurs once,
Landlord shall have the right at any time thereafter to require that all
succeeding monthly installments of Base Rent and all succeeding payments of
Additional Rent be paid to the Landlord in certified funds drawn on a bank
located in the metropolitan area in which the Premises are located. Said right
may be exercised by Landlord by giving notice of such requirements to Tenant,
but the giving of such notice and the exercise of this right by Landlord shall
not be construed to be a waiver of any default by Tenant or any other right
which Landlord may exercise under this Lease.
25.5 Time of The Essence. Time is of the essence in the performance by
-------------------
Tenant of its obligations hereunder.
25.6 Captions. Any captions contained in this Lease are not apart hereof,
--------
are for convenience only, and are not to be given any substantive meaning in
construing this Lease.
25.7 Entire Agreement. This Lease contains the entire agreement and
----------------
understanding between the parties hereto. There are no oral understandings,
terms, or conditions, and neither party has relied upon any representations,
express or implied, not contained in this Lease. All prior understandings,
terms, or conditions are deemed merged in this Lease. No modification of this
Lease shall be binding unless such modification shall be in writing and signed
by the parties hereto. Tenant acknowledges that it has not been induced to enter
into this Lease by any promises or representatives not expressly set forth in
this Lease, and if any such representations were made prior to the execution of
this Lease, Tenant acknowledges that it has not relied on the same, and that
Landlord shall have no liability with respect to any such representations.
25.8 Waivers. No failure by either party to insist upon the strict
-------
performance of any agreement, term, covenant or condition hereof or to exercise
any right or remedy consequent upon a breach thereof, and no acceptance of full
or partial rent or the continuance of any such breach, shall constitute a waiver
of any such breach of such agreement, term, covenant or condition or a
relinquishment of the right to exercise such right or remedy. No agreement,
term, covenant or condition hereof to be performed or complied with by either
party, and no breach
32
thereof, shall be waived, altered or modified except by a written instrument
executed by the other party. No waiver of any breach shall affect or alter this
Lease, but each and every agreement, term, covenant or condition hereof shall
continue in full force and effect with respect to any other then existing or
subsequent breach thereof. Notwithstanding any termination of this Lease, the
same shall continue in force and effect as to any provisions of the Lease,
including remedies, which require or permit observance or performance of
Landlord or Tenant subsequent to termination.
25.9 Recording. Tenant shall not record this Lease. Any such recordation
---------
by Tenant shall be a breach of this Lease.
25.10 Determinations by Landlord. Whenever in this Lease the Landlord is
--------------------------
to make any determination or decision, the Landlord shall make its determination
or decision in the exercise of its reasonable discretion and judgment; however,
any such determination or decision shall not bind the Landlord if it has not
been confirmed in writing.
25.11 Cumulative Remedies. No remedy or election by Landlord hereunder
-------------------
shall be deemed exclusive, but shall wherever possible be cumulative with ad
other remedies at law or in equity to which Landlord may be entitled.
25.12 Covenants and Conditions. Each provision of this Lease performable
------------------------
by Tenant shall be deemed both a covenant and a condition.
25.13 Binding Effect Choice of Law. Subject to any provisions hereof
----------------------------
restricting assignment, subletting or transfer by Tenant and subject to the
provisions of Section 25.2, this Lease shall bind the parties, their personal
representatives, heirs, successors and assigns. This Lease shall be governed by
the laws of the state where the Premises are located.
25.14 Attorneys' Fees. In the event of litigation relating to this Lease,
---------------
the prevailing party shall be entitled to recover from the losing party any
costs or reasonable attorneys' fees incurred by the prevailing party in
connection with such litigation. If Landlord utilizes the services of an
attorney to enforce any of its rights hereunder but which does not result in the
bringing of an action, Tenant shall immediately pay to Landlord upon demand
therefor the amount of such attorneys' fees incurred.
25.15 Landlord's Access. Landlord and Landlord's agents, representatives
-----------------
and designees shall have the right to enter the Premises as reasonably necessary
or desirable to Landlord for the purpose of inspecting the same, showing the
same to prospective purchasers, tenants, lenders or other transferees, making
such alterations, repairs, improvements or additions to the Premises or to the
Building as Landlord may deem necessary or desirable, or for any other
reasonable purpose as Landlord may determine. Landlord may at any time place in,
on or about the Premises any "For Sale", or "For Lease" or similar signs, all
without rebate of rent or liability to Tenant.
25.16 Auctions. Tenant shall not conduct any auction, liquidation sale, or
--------
going out of business sale in, on or about the Premises.
25.17 Merger. The voluntary or other surrender of this Lease by Tenant, or
------
a mutual cancellation thereof, shall not work a merger, and shall, at the option
of the Landlord, terminate ad or any existing subtenancies or may, at the option
of Landlord, operate as an assignment to Landlord of any or all of such
subtenancies.
33
25.18 Corporate Authority. If Tenant is a corporation, each individual
-------------------
executing this Lease on behalf of said corporation represents and warrants that
he is duly authorized to execute and deliver this Lease on behalf of said
corporation in accordance with a duly adopted resolution of the Board of
Directors of said corporation or in accordance with the Bylaws of said
corporation, and that this Lease is binding upon said corporation in accordance
with its terms.
25.19 Signs. Landlord may prescribe a uniform pattern of identification
-----
signs for tenants to be placed on the outside of the doors leading into their
respective premises, and other than such identification signs, Tenant shall not
install, paint, display, inscribe, place or affix, or otherwise attach, any
sign, fixture, advertisement, notice, lettering or direction on any part of the
outside of the Building or in the interior or other portion of the Building
without obtaining the prior written consent of the Landlord.
25.20 Brokers. The parties hereto acknowledge that the brokers named in
-------
Section 1.18 were the sole real estate brokers that represented the Landlord
herein, and that no commissions are owed by Landlord to any other brokers
whatsoever, and Tenant agrees to indemnify Landlord from claims for commission
from any other brokers arising out of the execution of this Lease.
25.21 Guarantor. In the even that there is a guarantor of this Lease,
---------
said guarantor shall have the same obligations as Tenant under this Lease.
25.22 Governing Law. This lease shall be governed by and construed in
-------------
accordance with the laws of the state in which the Building is located.
25.23 Joint and Several Liability. If two or more individuals,
---------------------------
corporations, partnerships or other business associates (or any combination of
two or more thereof) shall sign this Lease as Tenant, the liability of each such
individual, corporation, partnership or other business association to pay rent
and perform ad other obligations hereunder shall be deemed to be joint and
several, and all notices, payments and agreements given or made by, with or to
any one of such individuals, corporations, partnerships or other business
associations shall be deemed to have been given or made by, with or to all of
them. In like manner, if Tenant shall be a partnership or other business
association, the members of which are, by virtue of statute or federal law,
subject to personal liability, the liability of each such member be joint and
several.
25.24 Tenant's Time To ▇▇▇. Any claim, demand, right, or defense by
--------------------
Tenant that arises out of this lease or the negotiations that preceded this
lease shall be barred unless Tenant commences an action thereon, or interposes a
defense by reason thereof, within six (6) months after the date of the inaction,
omission, event, or action that gave rise to such claim, demand, right, or
defense.
25.25 No Joint Venture. Any intention to create a joint venture or
----------------
partnership relation between the parties hereto is hereby expressly disclaimed.
25.26 No Presumption Against Drafter. Landlord and Tenant agree and
------------------------------
acknowledge that: a) this lease has been freely negotiated by both parties; and
b) that in any controversy, dispute, or contest over the meaning,
interpretation, validity or enforceability of this lease or any of its terms,
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.
34
25.27 Condition of Premises. Except as set forth elsewhere in the Lease.
---------------------
Tenant shall accept the Premises in their current "as-is" condition and accepts
all defects. Tenants commencement of occupancy shall bar Tenant from making any
claim regarding the acceptability of the premises or any improvements made
thereto pursuant to the Lease. Tenant understands that it is in the interest of
the Landlord that the premises be kept clean, tastefully decorated, and
maintained in a business-like manner throughout the term of the lease. Tenant
shall not allow those areas of the premises which are visible to other tenants
or guests of the building to be come cluttered or littered nor shall Tenant or
Tenant's employees cause or permit any unpleasant odors to be created or
released in the premises. Tenant and Tenant's employees, guests and invitees
shall at all times dress in a manner appropriate for a professional office
building.
The parties hereto have executed this Lease on the first page hereof on the
dates specified immediately below their respective signatures.
35
EXHIBIT A, LEGAL DESCRIPTION
TO OFFICE BUILDING LEASE
BETWEEN 1330 Riverbend Investment Corp., LANDLORD
-------------------------------
AND CFData Corp., TENANT
------------
DESCRIPTION of a 2.703 acre tract of land situated in the ▇. ▇. ▇▇▇▇▇▇ Survey,
Abstract No. 958, Dallas County, Texas; said tract being all of ▇▇▇ ▇, ▇▇▇▇▇
▇/▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ on Stemmons II Addition, on addition to the City of Dallas,
Texas according to the plot recorded in Volume 97040, Page 8005 of the Deed
Records of Dallas County, Texas; sold tract of land being port of that certain
tract of land described In deed to Catlyn River Bend; Ltd. recorded in Volume
94119, Page 1662, of the Real Property Records of Dallas County, Texas; sold
2.703 acre tract being more particularly described as follows:
BEGINNING, at a 1/2-inch iron rod with "▇▇▇▇▇▇▇ ▇▇▇▇" cop found for corner in
the south line of River Bend Drive (a variable width right-of-way); said point
being the westernmost northwest corner of sold Lot 2 and being the northeast
corner of a tract of land described in deed to Vantage Properties, Inc. recorded
in Volume 78215, Page 3448 of the Deed Records of Dallas County, Texas; said
point also being In a curve to the left whose center bears North 06 degrees, 27
minutes, 58 seconds West, a distance of 319.28 feet from said point;
THENCE, in a northeasterly direction, with the south right-of-way line of said
River Bend Drive and along said curve to the left, through a central angle of 18
degrees, 38 minutes, 36 seconds, an arc distance of 103.89 feet to a 1/2-inch
Iron rod found at the end of said curve;
THENCE, North 64 degrees, 53 minutes, 25 seconds East, continuing with said
south line of River Bend Drive, a distance of 61.75 feet to a 1/2-inch iron rod
found at the beginning of a curve to the right whose center bears South 25
degrees, 06 minutes, 34 seconds East, a distance of 293.40 feet from said point;
THENCE, in an easterly direction, continuing with said south line of River Bend
Drive and along said curve to the right, through a central angle of 22 degrees,
05 minutes, 34 seconds, on arc distance of 113.13 feet to a 1/2-inch iron rod
found at a point of compound curve; said point being the beginning of a curve to
the right whose center bears South 03 degrees, 01 minutes, 00 seconds East, a
distance of 30.00 feet from said point;
THENCE, in a southeasterly direction, continuing with said south right-of-way
line of River Bend Drive and along said curve to the right, through a central
angle of 80 degrees, 14 minutes, 25 seconds, an arc distance of 42.01 feet to a
1/2-Inch iron rod found at a point of reverse curve; said point being in the
south line of a 700 foot radius cul-de-sac at the eastern end of said River Bend
Drive; said point being also in a curve to the left whose center bears North 77
degrees, 13 minutes, 25 seconds East, a distance of 100.00 feet from said point;
THENCE, in on easterly direction, with the southern line of said 100 foot radius
cul-de-sac and along said curve to the left, through a central angle of 720
degrees, 09 minutes, 40 seconds, an arc distance of 209.72 feet to a 1/2-inch
iron rod with "▇▇▇▇▇▇▇ ▇▇▇▇" cap found for corner; said point being the
northwest corner of ▇▇▇ ▇ ▇▇▇▇▇ ▇/▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ an Stemmons II; said
tract of land described in deed to Dallas County Mental Health and Mental
Retardation Center, recorded in Volume 96130, Page 5289 of the Real Property
Records of Dallas County, Texas;
36
THENCE, South 37 degrees, 52 minutes, 40 seconds East, with the west line of
sold Lot 1 and Dallas County Mental Health and Mental Retardation Center tract,
a distance of 88.39 feet to a cut "+" in concrete found for corner;
THENCE, South 00 degrees, 50 minutes, 10 seconds West, continuing with the west
line of said Lot 1 and Dallas County Mental Health and Mental Retardation Center
tract, a distance of 153.62 feet to a 1/2-inch iron rod with "▇▇▇▇▇▇▇ ▇▇▇▇" cap
found for corner; said point being in the south line of said River Bend on
Stemmons Addition II;
THENCE, with the southern line of sold River Bend on Stemmons Addition II, the
following two (2)
North 88 degrees, 18 minutes, 29 seconds West, a distance of 128.58 feet to
a 1/2-inch iron rod with "▇▇▇▇▇▇▇ ▇▇▇▇" cap found at an angle point;
South 78 degrees, 46 minutes, 49 seconds West, a distance of 266.58 feet to
a 3/8-inch Iron rod found for corner; said point being the southeast corner
of said Vantage Properties, Inc. tract;
THENCE, North 24 degrees, 57 minutes, 59 seconds West, with the eastern line of
said Vantage Properties, Inc. tract, a distance of 291.44 feet to the POINT OF
BEGINNING;
37
EXHIBIT B, PREMISES SITE PLAN
TO OFFICE BUILDING LEASE
BETWEEN 1330 Riverbend Investment Corp., LANDLORD
-------------------------------
AND CFData Corp., TENANT
------------
38
EXHIBIT C, PREMISES SITE PLAN
TO OFFICE BUILDING LEASE
BETWEEN 1330 Riverbend Investment Corp., LANDLORD
-------------------------------
AND CFData Corp., TENANT
------------
So long as this Lease remains in effect and Tenant is not in default
hereunder, Tenant shall have a nonexclusive license to use up to 52 parking
spaces which service the Building in consideration for Tenant's payment of $0
per month which shall be due and payable as Additional Rent at the same time as
are Tenant's monthly installments of Base Rent. This nonexclusive license shall
commence on the date on which Tenant's rental obligation under the Lease
commences, and shall terminate on the expiration date or earlier termination of
the lease. Provided, however, that upon not less than 30 days notice from
Landlord to Tenant, Landlord shall have the right to increase the monthly
payment hereunder to the prevailing rate for parking as then determined by
Landlord, but upon the giving of any such notice, Tenant shall have the right to
terminate this parking agreement commencing on the date on which the increase in
payment is to occur. If Tenant does not give notice to Landlord at least 15 days
prior to the date on which the increase in the amount of the payment hereunder
is to occur, then it shall be conclusively presumed that Tenant agrees to such
increase and Tenant shall have waived its right to terminate this parking
agreement as a result of such increase in the payment.
Upon not less than 30 days notice from Landlord to Tenant, Landlord may
alter the number of parking spaces which Tenant shall have the right to use,
provided that the number of spaces provided to Tenant shall not be diminished
below that number of parking spaces set forth above. Landlord reserves the right
to specifically assign and reassign from time to time any or all of said parking
spaces among the tenants of the Building in any manner in which Landlord
determines in its sole discretion and Tenant shall, upon not less than 10 days
notice from Landlord, furnish Landlord with the state automobile license number
assigned to its automobile or automobiles and the automobiles of all of its
employees and representatives employed or working in the premises, and Tenant
agrees to comply with such requests as Landlord may make in Landlord's
enforcement of any parking control program. Notwithstanding the existence of any
such control, Landlord shall not be responsible to Tenant, its employees,
agents, representatives, customers, or invitees for any violation of any parking
control program implemented by the Landlord.
The provisions of this Addendum supplement and are specifically subject to
all provisions of the Lease.
39
EXHIBIT D, RULES AND REGULATIONS
TO OFFICE BUILDING LEASE
BETWEEN 1330 Riverbend Investment Corp., LANDLORD
-------------------------------
AND CFData Corp., TENANT
------------
It is agreed that the following rules and regulations shall be and are
hereby made a part of this Lease, and the Tenant agrees that its employees and
agents or any other persons permitted by the Tenant to occupy or enter the
Demised Premises will at all times abide by these rules and regulations. It is
further agreed that a default in the performance and observation of these rules
and regulations shall operate the same as any other default under this Lease.
1. The sidewalks, entries, passages, and stairways shall not be obstructed
by the Tenant or its agents, or used by them for any purpose other than ingress
and egress to and from their offices.
2. a. Furniture, equipment, or supplies shall be moved in or out of the
Building only during such hours and in such manner as may be prescribed by the
Landlord.
b. No safe or article, the weight of which may constitute a hazard or
danger to the Building or its equipment, shall be moved into the Premises.
Safes and other equipment, the weight of which is not excessive, shall be moved
into, from or about the Building during such hours and in such manner as shall
be prescribed by the Landlord, and the Landlord shall have the right to
designate the location of such articles in the space hereby demised.
3. The name of the Tenant and/or signs of the Tenant shall not be placed
upon any part of the Premises except as provided by the Landlord.
4. Water closets and other water fixtures shall not be used for any purpose
other than that for which the same are intended, and any damage resulting to the
same from misuse on the part of the Tenant, its agents or employees, shall be
paid for by the Tenant. No person shall waste water by tying back or wedging the
faucets or in any other manner.
5. No animals shall be allowed in the office, halls, or corridors of the
Building.
6. Bicycles or other vehicles shall not be permitted in the offices, halls,
or corridors of the Buildings, nor shall any obstruction of sidewalks of
entrances of the Building by such be permitted.
7. No person shall disturb the occupants of the Building or adjoining
buildings or premises by the use of any television, radio, or musical instrument
or equipment, or by the making of loud or improper noises.
8. No additional lock or locks shall be placed by the Tenant on any door in
the Building unless written consent of the Landlord shall first be obtained.
40
9. The use of oil, gas or inflammable liquids for heating, lighting, or any
other purpose is expressly prohibited. Explosives or other articles deemed extra
hazardous shall not be brought into the Building.
10. The Tenant shall exercise due care and within reasonable limits shall
not ▇▇▇▇ upon, paint or affix upon, cut, drill into, drive nails or screws into,
or in any way deface the wails, ceiling, partitions; or floors of the Premises
or of the Building, and any defacement, damage, or injury caused by the Tenant,
its agents or employees, shall be paid for by the Tenant.
11. The Landlord shall at all times have the right by its officers or
agents to enter the Demised Premises to inspect and examine the same and to show
the same to persons wishing to lease, purchase, or mortgage them.
12. The Tenant agrees to use chair pads to be furnished by the Tenant under
all rolling and ordinary desk chairs in the carpeted areas of the Demised
Premises throughout the term of this Lease.
13. There shall be no smoking of pipes, cigars, cigarettes, or similar
substances in the building (including common areas and private suites) or site,
except in such areas as Landlord may specifically designate as a "smoking room"
or "smoking area." Landlord shall have no duty to designate any such smoking
areas.
14. The Landlord reserves the right to make such other and further
reasonable rules and regulations as in its judgment may from time to time be
necessary and desirable for the safety, care, and cleanliness of the Demised
Premises and for the preservation of good order therein. Such rules and
regulations shall be effective upon receipt of changes and/or additions as
provided by the provision for Notice, Section 19 of said Lease.
41
ADDENDUM "A"
TO
LEASE
AGREEMENT
TO LEASE DATED August 18, 1998
---------------
BETWEEN 1330 Riverbend Investment Corp., LANDLORD
-------------------------------
AND CFData Corp., TENANT
------------
This addendum to the above referenced lease agreement ("the lease") is made this
August 18, 1998 by and between 1330 Riverbend Investment Corp. and CFData Corp.
------------------------------- -----------
WHEREAS, Landlord and Tenant are parties to the above-described Lease for
the Premises; and
WHEREAS, the parties desire to amend said lease.
NOW THEREFORE, in consideration of the mutual promises and obligations
contained herein, the adequacy and sufficiency of which is hereby acknowledged,
Landlord and Tenant contract and agree as follows:
AS-IS CONDITION
---------------
Tenant shall accept the premises in their `as-is, where-is' condition accepting
therewith all damage, faults and defects.
ACCESS PRIOR TO COMMENCEMENT
----------------------------
Prior to the commencement of the lease hereunder, Tenant shall have the right to
access the premises for delivery of furniture and equipment and for alterations
to the premises only. Any alterations to the premises must be approved in
writing by Landlord and performed in accordance with the Lease and Section 10.4
thereto. The commencement date of the Lease shall be the earlier of twenty (20)
days after the Landlord has notified Tenant that it may access the premises or
the date that Tenant occupies the premises or begins to conduct business out of
the premises.
OPERATING EXPENSES
------------------
For the initial Lease term (i.e. that period between the Commencement Date and
the Expiration Date as originally set forth herein), Tenant shall not be
required to pay its Pro-rata Share of Shared Expenses as set forth in Section 6
to the Lease. For any holdover, extension or renewal of the lease or other
occupancy of the premises following the expiration date set forth in the Lease,
Tenant shall be responsible for its Pro-rata Share of Shared Expenses as set
forth in Section 6 to the Lease. This provision should not be construed to
eliminate Tenant's requirement to pay additional rent not related to Tenant's
Pro-rats Share of Shared Expenses.
FURNITURE
---------
Tenant acknowledges that certain items of laminated cabinetry and furniture in
seven offices (such offices being indicated by the character "*" on the plan in
Exhibit B attached hereto) within the premises which may have the appearance of
being permanently affixed in the premises are the property of I35, Inc. and may
be removed prior to the premises being delivered to Tenant.
42
EXCEPT AS HEREBY AMENDED, all other provisions of said lease are hereby
confirmed and ratified.
IN WITNESS WHEREOF, the parties hereto have executed this amendment on the date
first above written.
LANDLORD:____________________ TENANT:___________________
By: ____________________ By: ___________________
Title: ____________________ Title: ___________________
▇▇
▇▇▇▇▇▇▇▇ "▇" TO LEASE
BETWEEN
1330 RIVERBEND INVESTMENT CORP., AS LANDLORD
AND
CFDATA CORP., AS TENANT
AMERICANS WITH DISABILITIES ACT OF 1990 - Tenant shall be responsible for, and
---------------------------------------
shall bear all costs and expenses associated with, any and all alterations to
the Premises which may be required by the Americans with Disabilities Act of
1990 (the "ADA"), for the accommodation of disabled individuals who may be
employed from time to time by Tenant, or any disabled customers, clients,
guests, or invitees or sublessees. Tenant shall indemnify and hold Landlord
harmless from and against any and all liability incurred arising from the
failure of the Premises to conform with the ADA, including the cost of making
any alterations, renovations or accommodations required by the ADA, or any
government enforcement agency, or any courts, any and all fines, civil
penalties, and damages awarded against Landlord (or those awarded against Tenant
which could become a lien upon the property upon which the Premises are located)
resulting from a violation or violations of the ADA, and all reasonable legal
expenses and court costs incurred in defending claims made under the ADA,
including without limitation reasonable consultants', attorneys' and paralegals'
fees, expenses and court costs. Notwithstanding anything herein to the
contrary, Landlord will be responsible for alterations to the bathrooms and
sinks in the premises which may be required as set forth above.
HAZARDOUS WASTE - The term "Hazardous Materials", as used in this Lease shall
---------------
mean pollutants, contaminants, toxic or hazardous wastes, or any other
substances, the use and/or the removal of which is required or the use of which
is restricted, prohibited or penalized by an "Environmental Law", which term
shall mean any federal, state or local law, ordinance or other statute of a
governmental or quasi-governmental authority relating to pollution or protection
of the environment. Lessee hereby agrees that (i) no activity will be conducted
on the premises that will produce any Hazardous Substance, except for such
activities that are part of the ordinary course for Lessee's business activities
(the "Permitted Activities") provided said Permitted Activities are conducted in
accordance with all Environmental Laws and have been approved in advance in
writing by Lessor; Lessee shall be responsible for obtaining any required
permits and paying any fees and providing any testing required by any
governmental agency; (ii) the premises will not be used in any manner for the
storage of any Hazardous Substances except for the storage of such materials
that are used in the ordinary course of Lessee's business ("Permitted
Materials") provided such Permitted Materials are property stored in a manner
and location meeting all Environmental Laws and approved in advance in writing
by Lessor; Lessee shall be responsible for obtaining any required permits and
paying any fees and providing any testing required by any governmental agency;
(iii) no portion of the premises will be used as a landfill or a dump; (iv)
Lessee will not install any underground tanks of any type; (v) Lessee will not
allow any surface or subsurface conditions to exist or come into existence as a
result of Lessee's actions or the conduct of Lessee's business on the Leased
Premises that constitute or with the passage of time may constitute a public or
private nuisance; (vi) Lessee will not permit any Hazardous Substances to be
brought onto the premises, except for the Permitted Materials described below,
or hereafter approved in writing by Lessor and if so brought or found located
thereon, the same shall be immediately removed, with proper disposal, and all
required cleanup procedures shall be diligently undertaken pursuant to all
Environmental Laws. Lessor or Lessor's representative shall have the right but
not the obligation to enter the premises for the purposes of inspecting the
storage, use and disposal of Permitted Materials to ensure compliance with all
Environmental Laws. Should it be determined, in Lessor's sole
44
opinion, that said Permitted Materials are being improperly stored, used, or
disposed of, then Lessee shall immediately take such corrective action within 24
hours, Lessor shall have the right to perform such work and Lessee shall
promptly reimburse Lessor for any and all costs associated with said work. If at
any time during or after the term of the Lease, the Premises are found to be so
contaminated or subject to said conditions, and such contamination is caused by
Lessee or the conduct of its business on the Leased Premises, Lessee shall
diligently institute proper and thorough cleanup procedures at Lessee's sole
cost, and Lessee agrees to indemnify, save and hold Lessor harmless from all and
against claims, demands, actions, liabilities, costs, expenses, damages and
obligations of any nature arising from or as a result of the use of the premises
by Lessee, and regardless of whether or not Lessor is found to be solely,
concurrently, or jointly negligent with Lessee. The foregoing indemnification
and the responsibilities of Lessee shall survive the termination or expiration
of this Lease. Anything contained herein to the contrary notwithstanding, Lessor
shall not unreasonably withhold its consent with respect to the use, storage,
generation or manufacturing of Hazardous Substances on or about the Leased
Premises provided same is done in the ordinary course of Lessee's business, and
in compliance with all environmental laws.
PERMITTED MATERIALS:
1. None
LANDLORD: 1330 Riverbend Investment Corp. TENANT: CFData Corp.
_________________________________________ __________________________________
By: ______________________________ By: ______________________
Title: ______________________________ Title: ______________________
45
FINANCING STATEMENT
This Financing statement is presented for
filing pursuant to the Uniform Commercial
Code and will remain effective, with THIS SPACE FOR USE OF FILING OFFICER
certain exceptions, for five years frees (DATE, TIME, NUMBER, FILING OFFICER)
date of filing.
-------------------------------------------------------------------------------
A. NAME AND TELEPHONE OF CONTACT AT FLIER:
▇▇▇▇ ▇▇▇▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
-------------------------------------------------------------------------------
B. RETURN COPY TO:
1330 Riverbend Investment Corp.
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------------------------------------------------------------
C. DEBTOR DESIGNATION:
Lessee
-------------------------------------------------------------------------------
1. DEBTOR'S NAME & ADDRESS
NAME: CPData Corp.
ADDRESS: ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
TAX ID# ▇▇-▇▇▇▇▇▇▇
ENTITY: Corporation STATE: Texas
2. SECURED PARTY
NAME: 1330 Riverbend Investment Corp.
ADDRESS: ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
TAX ID# ▇▇-▇▇▇▇▇▇▇
ENTITY: Corporation STATE: Texas
3. This FINANCING STATEMENT Covers the following items or types of property:
All of Debtor's (or any of its affiliates) now owned or hereafter
acquired inventory, furniture, fixtures and equipment at the following
locations:
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
4. SIGNATURE OF DEBTOR
______________________________
CFData Corp.,
A Texas Corporation
46
5. SIGNATURE OF SECURED PARTY
________________________________
1330 Riverbend Investment Corp.,
A Texas Corporation
47