EXHIBIT 10.14
NORTH TEXAS COMMERCIAL ASSOCIATION OF REALTORS(R)
COMMERCIAL LEASE AGREEMENT
TABLE OF CONTENTS EXHIBITS AND ADDENDA. Any exhibit or addendum
Article Page attached to this Lease is incorporated as a part of this Lease for all
1. Defined Terms 1 purposes. Any term not specifically defined in the Addenda shall
2. Lease and Lease Term 2 have the same meaning given to it in the body of this Lease. To
3. Rent and Security Deposit 2 the extent any provisions in the body of this Lease conflict with
4. Taxes 2 the Addenda, the Addenda shall control.
5. Insurance and Indemnity 3
6. Use of Demised Premises 3 [Check all boxes which apply. Boxes not checked do not apply.]
7. Property Condition, Maintenance, Repairs and 4 [x] Exhibit A Floor Plan or Site Plan
Alterations
8. Damage or Destruction 5 [x] Exhibit B Survey and/or Legal Description of the Property
9. Condemnation 5
10. Assignment and Subletting 5 [x] Addendum A Expense Reimbursement
11. Default and Remedies 5 [ ] Addendum B Renewal Options
12. Landlord's Contractual Lien 6 [ ] Addendum C Right of First Refusal for Additional Space
13. Protection of Lenders 7 [ ] Addendum D Percentage Rental/Gross Sales Reports
14. Environmental Representations and Indemnity 7 [ ] Addendum E Guarantee
15. Professional Service Fees 8 [ ] Addendum F Construction of Improvements
16. Miscellaneous 8 [x] Addendum G Rules and Regulations
17. Additional Provisions 9 [x] Addendum H Other ______________________________
IN CONSIDERATION of the agreements set forth in this Lease, the parties agree as
follows:
ARTICLE ONE: DEFINED TERMS. As used in this Commercial Lease Agreement (the
"Lease"), the terms set forth in this Article One have the following respective
meanings:
1.01. Effective Date: The last date set forth by the signatures of Landlord
and Tenant on page 9 below.
1.02. Landlord: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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Address: ▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇
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▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ Telephone: ▇▇▇ ▇▇▇-▇▇▇▇ Fax: ▇▇▇ ▇▇▇-▇▇▇▇
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1.03. Tenant: Efficient Networks, Inc.
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Address: ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
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▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇-▇▇▇▇ Telephone: ▇▇▇ ▇▇▇-▇▇▇▇ Fax: ▇▇▇ ▇▇▇-▇▇▇▇
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1.04. Demised Premises: Graystone Office Park
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A. Street address: 3310 ▇▇▇▇▇▇ Springs
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▇▇▇▇▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇ in Dallas County, Texas.
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B. Floor Plan or Site Plan: Being a floor area of approximately
11,340 square feet and being approximately feet by
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feet (measured to the exterior of outside walls and to
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the center of the interior walls) and being more particularly shown in
outline form on Exhibit A, FLOOR PLAN OR SITE PLAN.
C. Legal description: The property on which the Demised Premises is
situated (the "Property") is more particularly described as:
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or is described in Exhibit B,
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SURVEY AND/OR LEGAL DESCRIPTION.
D. Tenant's pro rata share of the Property is 11.9%. [See Addendum
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A, if applicable]
1.05. Lease Term: 3 years and 0 months beginning on 11/1/98 (the "Commencement
--- ---
Date") and ending on 10/31/01 (the "Expiration Date").
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1.06. Base Rent: $ 374,220 total Base Rent for the Lease Term payable in
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monthly installments of $ 10,395 per month in advance. (The total amount
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of Rent is defined in Section 3.01.)
1.07. Percentage Rental Rate: ____________ %. [See Addendum D if applicable]
1.08. Security Deposit: $ 10,395 (due upon execution of this Lease). [See
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Section 3.04]
1.09. Permitted Use: Office, Production, Storage
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___________________________________________________________. [See Section 6.01]
1.10. Party to whom Tenant is to deliver payments under this Lease [check one]:
[x] Landlord [ ] Principal Broker
[ ] Other
________________________________________________________________________
Landlord may designate in writing the party authorized to act on behalf
of Landlord to enforce this Lease. Any such authorization will remain in
effect until it is revoked by Landlord in writing.
1.11. Principal Broker: The Worth Company, acting as agent for [check one]: [ ]
the Landlord exclusively, [x] the Tenant exclusively, [ ] both Landlord
and Tenant as dual agent. Principal Broker's Address: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇.
LB 37, Suite 800 ▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇
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_____________________ Telephone: ▇▇▇ ▇▇▇ ▇▇▇▇ Fax: ▇▇▇ ▇▇▇ ▇▇▇▇
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1.12. Cooperating Broker: N/A, acting as agent for [check one]: [ ] the
----
Landlord exclusively.
[ ] the Tenant exclusively, [ ] both Landlord and Tenant as dual agent.
Cooperating Broker's Address:
_________________________________________________________________________
____________________________________ Telephone: ________________ Fax:
___________________________
1.13. The Fee: The Professional Service Fee as set forth in Commission
Agreement Attached as Exhibit C
A. __________________ percent ( _____ %).
B. The percentage applicable in Section 15.04 in the event of a sale
shall be ___________ percent ( _____ %).
1.14. [Section deleted]
Page 1
ARTICLE TWO: LEASE AND LEASE TERM
2.01. Lease of Demised Premises for Lease Term. Landlord leases the Demised
Premises to Tenant and Tenant leases the Demised Premises from Landlord for the
Lease Term stated in Section 1.05. The Commencement Date is the date specified
in Section 1.05, unless advanced or delayed under any provision of this Lease.
2.02. Delay in Commencement. Landlord shall not be liable to Tenant if Landlord
does not deliver possession of the Demised Premises to Tenant on the
Commencement Date specified in Section 1.05 above. Landlord's non-delivery of
possession of the Demised Premises to Tenant on the Commencement Date will not
affect this Lease or the obligations of Tenant under this Lease. However, the
Commencement Date shall be delayed until possession of the Demised Premises is
delivered to Tenant. The Lease Term shall be extended for a period equal to the
delay in delivery of possession of the Demised Premises to Tenant, plus the
number of days necessary for the Lease Term to expire on the last day of a
month. If Landlord does not deliver possession of the Demised Premises to Tenant
within sixty (60) days after the Commencement Date specified in Section 1.05,
Tenant may cancel this Lease by giving written notice to Landlord within ten
(10) days after the 60-day period ends. If Tenant gives such notice, this Lease
shall be canceled effective as of the date of its execution, and no party shall
have any obligations under this Lease. If Tenant does not give such notice
within the time specified, Tenant shall have no right to cancel this Lease, and
the Lease Term shall commence upon the delivery of possession of the Demised
Premises to Tenant. If delivery of possession of the Demised Premises to Tenant
is delayed, Landlord and Tenant shall, upon such delivery, execute an amendment
to this Lease setting forth the revised Commencement Date and Expiration Date of
the Lease Term.
2.03. Early Occupancy. If Tenant occupies the Demised Premises prior to the
Commencement Date, Tenant's occupancy of the Demised Premises shall be subject
to all of the provisions of this Lease. Early occupancy of the Demised Premises
shall not advance the Expiration Date. Unless otherwise provided herein, Tenant
shall pay Base Rent and all other charges specified in this Lease for the period
of occupancy.
2.04. Holding Over. Tenant shall vacate the Demised Premises immediately upon
the expiration of the Lease Term or earlier termination of this Lease. Tenant
shall reimburse Landlord for and indemnify Landlord against all damages incurred
by Landlord as a result of any delay by Tenant in vacating the Demised Premises.
If Tenant does not vacate the Demised Premises upon the expiration of the Lease
Term or earlier termination of this Lease, Tenant's occupancy of the Demised
Premises shall be a day-to-day tenancy, subject to all of the terms of this
Lease, except that the Base Rent during the holdover period shall be increased
to an amount which is one-and-one-half (1 1/2) times the Base Rent in effect on
the expiration or termination of this Lease, computed on a daily basis for each
day of the holdover period, plus all additional sums due under this Lease. This
paragraph shall not be construed as Landlord's consent for Tenant to hold over
or to extend this Lease.
ARTICLE THREE: RENT AND SECURITY DEPOSIT
3.01. Manner of Payment. All sums payable under this Lease by Tenant (the
"Rent") shall be made to the Landlord at the address designated in Section 1.02,
unless another person is designated in Section 1.10, or to any other party or
address as Landlord may designate in writing. Any and all payments made to a
designated third party for the account of the Landlord shall be deemed made to
Landlord when received by the designated third party. All sums payable by Tenant
under this Lease, whether or not expressly denominated as rent, shall constitute
rent for the purposes of Section 502(b)(6) of the Bankruptcy Code and for all
other purposes. The Base Rent is the minimum rent for the Demised Premises and
is subject to the terms and conditions contained in this Lease, together with
the attached Addenda, if any.
3.02. Time of Payment. Upon execution of this Lease, Tenant shall pay the
installment of Base Rent for the first month of the Lease Term. On or before the
first day of the second month of the Lease Term and of each month thereafter,
the installment of Base Rent and other sums due under this Lease shall be due
and payable, in advance, without off-set, deduction or prior demand. If the
Lease Term commences or ends on a day other than the first or last day of a
calendar month, the rent for any fractional calendar month following the
Commencement Date or preceding the end of the Lease Term shall be prorated by
days.
3.03. Late Charges. Tenant's failure to promptly pay sums due under this Lease
may cause Landlord to incur unanticipated costs. The exact amount of those costs
is impractical or extremely difficult to ascertain. The costs may include, but
are not limited to, processing and accounting charges and late charges which may
be imposed on Landlord by any ground lease or deed of trust encumbering the
Demised Premises. Payments due to Landlord under this Lease are not an extension
of credit. Therefore, Landlord may, at Landlord's option and to the extent
allowed by applicable law, impose a Late Charge on any payments which are
not received by Landlord on or before the due date in an amount equal to one-
half of one percent (0.5%) of the amount of the past due payments (the "Late
Charge") per day for each day after the due date, until the past due amount in
Good Funds is received by Landlord, up to a maximum of ten percent (10%) of the
past due amount. A Late Charge may be imposed only once on each past due
payment. Any Late Charge will be in addition to Landlord's other remedies for
nonpayment of rent. If any check tendered to Landlord by Tenant under this Lease
is dishonored for any reason, Tenant shall pay to the party receiving payments
under this Lease a fee of twenty-five dollars ($25.00), plus (at Landlord's
option) a Late Charge as provided above until good funds are received by
Landlord. The parties agree that any Late Charge and dishonored check fee
represent a fair and reasonable estimate of the costs Landlord will incur by
reason of the late payment or dishonored check. Payments received from Tenant
shall be applied first to any Late Charges, second to Base Rent, and last to
other unpaid charges or reimbursements due to Landlord. Notwithstanding the
foregoing, Landlord will not impose a Late Charge as to the first late payment
in any calendar year, unless Tenant fails to pay the late payment to Landlord
within three (3) business days after the delivery of a written notice from
Landlord to Tenant demanding the late payment be paid. However, Landlord may
impose a Late Charge without advance notice to Tenant on any subsequent late
payment in the same calendar year.
3.04. Security Deposit. Upon execution of this Lease, Tenant shall deposit with
Landlord a cash Security Deposit in the amount stated in Section 1.08. Landlord
may apply all or part of the Security Deposit to any unpaid Rent or other
charges due from Tenant or to cure any other defaults of Tenant. If Landlord
uses any part of the Security Deposit, Tenant shall restore the Security Deposit
to its full amount within ten (10) days after Landlord's written demand.
Tenant's failure to restore the full amount of the Security Deposit within the
time specified shall be a default under this Lease. No interest will be paid on
the Security Deposit. Landlord will not be required to keep the Security Deposit
separate from its other accounts and no trust relationship is created with
respect to the Security Deposit. Upon any termination of this Lease not
resulting from Tenant's default, and after Tenant has vacated the Property and
cleaned and restored the Demised Premises in the manner required by this Lease,
Landlord shall refund the unused portion of the Security Deposit to Tenant
within thirty days after the Termination Date or thirty days after Tenant fully
complies with the conditions of termination as required in Section 7.05,
whichever is later.
3.05. Good Funds Payments. If, for any reason whatsoever, any two or more
payments by check from Tenant to Landlord for Rent are dishonored and returned
unpaid, thereafter Landlord may, at Landlord's sole option, upon written notice
to Tenant, require that all future payments of Rent for the remaining term of
the Lease must be made by cash, certified check, cashier's check, or money order
("Good Funds") and that the delivery of Tenant's personal or corporate check
will no longer constitute payment of Rent under this Lease. Any acceptance by
Landlord of a payment for Rent by Tenant's personal or corporate check
thereafter shall not be construed as a waiver of Landlord's right to insist upon
payment by Good Funds as set forth herein.
ARTICLE FOUR: TAXES
4.01. Payment by Landlord. Landlord shall pay the real estate taxes on the
Demised Premises during the Lease Term.
4.02. Improvements by Tenant. If the real estate taxes levied against the
Demised Premises for the real estate tax year in which the Lease Term commences
are increased as a result of any alterations, additions or improvements made by
Tenant or by Landlord at the request of Tenant, Tenant shall pay to Landlord
upon demand the amount of the increase and continue to pay the increase during
the Lease Term. Landlord shall use reasonable efforts to obtain from the tax
assessor or assessors a written statement of the total amount of the increase.
4.03. Joint Assessment. If the real estate taxes are assessed against the
Demised Premises jointly with other property not constituting a part of the
Demised Premises, the real estate taxes applicable to the Demised Premises shall
be equal to the amount bearing the same proportion to the aggregate assessment
that the total square feet of building area in the Demised Premises bears to the
total square feet of building area included in the joint assessment.
4.04. Personal Property Taxes. Tenant shall pay all taxes assessed against
trade fixtures, furnishings, equipment, inventory, products, or any other
personal property belonging to Tenant. Tenant shall use reasonable efforts to
have Tenant's personal property taxed separately from the Demised Premises. If
any of Tenant's personal property is taxed with the Demised Premises, Tenant
shall pay the taxes for the personal property to Landlord within fifteen (15)
days after Tenant receives a written statement from Landlord for the personal
property taxes.
ARTICLE FIVE: INSURANCE AND INDEMNITY
5.01. Casualty Insurance. During the Lease Term, Landlord shall maintain
policies of insurance covering loss of or damage to the Demised Premises in an
amount or percentage of replacement value as Landlord deems reasonable in
relation to the age, location, type of construction and physical condition of
the Demised Premises and the availability of insurance at reasonable rates. The
policies shall provide protection against all perils included within the
classification of fire and extended coverage and any other perils which Landlord
deems necessary Landlord may, at Landlord's option, obtain insurance coverage
for Tenant's fixtures, equipment or building improvements installed by Tenant in
or on the Demised Premises. Tenant shall, at Tenant's expense, maintain
insurance on its fixtures, equipment and building improvements as Tenant deems
necessary to protect Tenant's interest. Tenant shall not do or permit to be done
anything which invalidates any insurance policies. Any casualty insurance
carried by Landlord or Tenant shall be for the sole benefit of the party
carrying the insurance and under its sole control.
5.02. Increase in Premiums. Tenant shall not permit any operation or activity
to be conducted, or storage or use of any volatile or any other materials, on or
about the Demised Premises that would cause suspension or cancellation of any
fire and extended coverage insurance policy carried by Landlord, or increase the
premiums therefor, without the prior written consent of Landlord. If Tenant's
use and occupancy of the Demised Premises causes an increase in the premiums for
any fire and extended coverage insurance policy carried by Landlord, Tenant
shall pay to Landlord, as additional rental, the amount of the increase within
ten days after demand and presentation by Landlord of written evidence of the
increase.
5.03. Liability Insurance. During the Lease Term, Tenant shall maintain a
commercial general liability policy of insurance, at Tenant's expense, insuring
Landlord against liability arising out of the ownership, use, occupancy, or
maintenance of the Demised Premises. The initial amounts of the insurance must
be at least: $1,000,000 for Each Occurrence, $2,000,000 General Aggregate per
policy year, $100,000 Property Damage for the Demised Premises, and $10,000
Medical Expense; plus a $5,000,000 commercial general liability umbrella; and
shall be subject to periodic increases based upon economic factors as Landlord
may determine, in Landlord's discretion, exercised in good faith. However, the
amounts of the insurance shall not limit Tenant's liability nor relieve Tenant
of any obligation under this Lease. The policies must contain cross-liability
endorsements, if applicable, and must insure Tenant's performance of the
indemnity provisions of Section 5.04. The policies must contain a provision
which prohibits cancellation or modification of the policy except upon thirty
(30) days' prior written notice to Landlord. Tenant may discharge Tenant's
obligations under this Section by naming Landlord as an additional insured under
a comprehensive policy of commercial general liability insurance maintained by
Tenant and containing the coverage and provisions described in this Section.
Tenant shall deliver a copy of the policy or certificate (or a renewal) to
Landlord prior to the Commencement Date and prior to the expiration of the
policy during the Lease Term. If Tenant fails to maintain the policy, Landlord
may elect to maintain the insurance at Tenant's expense. Tenant may, at Tenant's
expense, maintain other liability insurance as Tenant deems necessary to protect
Tenant
5.04. Indemnity. Landlord shall not be liable to Tenant or to Tenant's
employees, agents, invitees or visitors, or to any other person, for any injury
to persons or damage to property on or about the Demised Premises or any
adjacent area owned by Landlord caused by the negligence or misconduct of
Tenant, Tenant's employees, subtenants, agents, licensees or concessionaires or
any other person entering the Demised Premises under express or implied
invitation of Tenant, or arising out of the use of the Demised Premises by
Tenant and the conduct of Tenant's business, or arising out of any breach or
default by Tenant in the performance of Tenant's obligations under this Lease,
and Tenant hereby agrees to indemnify and hold Landlord harmless from any loss,
expense or claims arising out of such damage or injury Tenant shall not be
liable for any injury or damage caused by the negligence or misconduct of
Landlord, or Landlord's employees or agents, and Landlord agrees to indemnify
and hold Tenant harmless from any loss, expense or damage arising out of such
damage or injury.
5.05. Comparative Negligence. Tenant and Landlord hereby unconditionally and
irrevocably agree to indemnify, defend and hold each other and their officers,
agents, directors, subsidiaries, partners, employees, licensees and counsel
harmless, to the extent of each party's comparative negligence, if any, from and
against any and all loss, liability, demand, damage, judgment, suit, claim,
deficiency, interest, fee, charge, cost or expense (including, without
limitation, interest, court costs and penalties, reasonable attorney's fees and
disbursements and amounts paid in settlement, or liabilities resulting from any
change in federal, state or local law or regulation or interpretation of this
Lease) of whatever nature, on a comparative negligence basis, even when caused
in part by Landlord's or Tenant's negligence or the joint or concurring
negligence of Landlord, Tenant, and any
other person or entity, which may result or to which Landlord or Tenant and/or
any of their officers, agents, directors, employees, subsidiaries, partners,
licensees and counsel may sustain, suffer, incur or become subject to in
connection with or arising in any way whatsoever out of the leasing, operation,
promotion, management, maintenance, repair, use or occupation of the Demised
Premises, or any other activity of whatever nature in connection therewith, or
arising out of or by reason of any investigation, litigation or other
proceedings brought or threatened, arising out of or based upon the leasing,
operation, promotion, management, maintenance, repair, use or occupancy of the
Demised Premises, or any other activity on the Demised Premises. This provision
shall survive the expiration or termination of this Lease.
5.06. Waiver of Subrogation. Each party to this Lease waives any and every
claim which arises or may arise in its favor against the other party during the
term of this Lease or any renewal or extension of this Lease for any and all
loss of, or damage to, any of its property located within or upon, or
constituting a part of, the Demised Premises, which loss or damage is covered by
valid and collectible fire and extended coverage insurance policies, to the
extent that such loss or damage is recoverable under such insurance policies.
These mutual waivers shall be in addition to, and not in limitation or
derogation of, any other waiver or release contained in this Lease with respect
to any loss of, or damage to, property of the parties. Inasmuch as these mutual
waivers will preclude the assignment of any aforesaid claim by way of
subrogation or otherwise to an insurance company (or any other person), each
party hereby agrees to give immediately to each insurance company (which has
issued to such party policies of fire and extended coverage insurance) written
notice of the terms of such mutual waivers, and to cause such insurance policies
to be properly endorsed to prevent the invalidation of the insurance coverage by
reason of these waivers
ARTICLE SIX: USE OF DEMISED PREMISES
6.01. Permitted Use. Tenant may use the Demised Premises only for the Permitted
Use stated in Section 1.09. The parties to this Lease knowledge that the current
use of the Demised Premises or the improvements located on the Demised Premises,
or both, may or may not conform to the city zoning ordinance with respect to the
permitted use, height, setback requirements, minimum parking requirements,
coverage ratio of improvements to total area of land, and other matters which
may have a significant economic impact upon the Tenant's intended use of the
Demised Premises. Tenant acknowledges that Tenant has or will independently
investigate and verify to Tenant's satisfaction the extent of any limitations or
non-conforming uses of the Demised Premises. Tenant further acknowledges that
Tenant is not relying upon any warranties or representations of Landlord or the
Brokers who are participating in the negotiation of this Lease concerning the
Permitted Use of the Demised Premises, or with respect to any uses of the
improvements located on the Demised Premises
6.02. Compliance with Law. Tenant shall comply with all governmental laws,
ordinances and regulations applicable to the use of the Demised Premises, and
shall promptly comply with all governmental orders and directives for the
correction, prevention and abatement of nuisances and other activities in or
upon, or connected with the Demised Premises, all at Tenant's sole expense,
including any expense or cost resulting from the construction or installation of
fixtures and improvements or other accommodations for handicapped or disabled
persons required for compliance with governmental laws and regulations,
including but not limited to the Texas Architectural Barriers Act (Article 9102
and any successor statute) and the Americans with Disabilities Act (the "ADA").
To the extent any alterations to the Demised Premises are required by the ADA or
other applicable laws or regulations, Tenant shall bear the expense of the
alterations. To the extent any alterations to areas of the Property outside the
Demised Premises are required by Title III of the ADA or other applicable laws
or regulations (for "path of travel" requirements or otherwise), Landlord shall
bear the expense of the alterations
6.03. Certificate of Occupancy. If required, Tenant shall obtain a Certificate
of Occupancy from the municipality in which the Property is located prior to
occupancy of the Demised Premises. Tenant may apply for a Certificate of
Occupancy prior to the Commencement Date and, if Tenant is unable to obtain a
Certificate of Occupancy, Tenant shall have the right to terminate this Lease by
written notice to Landlord if Landlord or Tenant is unwilling or unable to cure
the defects which prevented the issuance of the Certificate of Occupancy
Landlord may, but has no obligation to, cure any such defects, including any
repairs, installations, or replacements of any items which are not presently
existing on the Demised Premises, or which have not been expressly agreed upon
by Landlord in writing.
6.04. Signs. Without the prior written consent of Landlord, Tenant may not
place any signs, ornaments or other objects upon the Demised Premises or on the
Property, including but not limited to the roof or exterior of the building or
other improvements on the Property, or paint or otherwise decorate or deface the
exterior of the building. Any signs installed by Tenant must conform with
applicable laws, deed restrictions on the Property, and other applicable
requirements. Tenant must remove all signs, decorations and ornaments at the
expiration or termination of this Lease and must repair any damage and close any
holes caused by the removal.
6.05. Utility Services. Tenant shall pay the cost of all utility services,
including but not limited to initial connection charges, all charges for gas,
water, sewerage, storm water disposal, communications and electricity used on
the Demised Premises, and for replacing all electric lights, lamps and tubes.
6.06. Landlord's Access. Landlord and Landlord's agents shall have the right
to, during normal business hours and upon reasonable advance notice, and without
unreasonably interfering with Tenant's business, enter the Demised Premises: (a)
to inspect the general condition and state of repair of the Demised Premises,
(b) to make repairs required or permitted under this Lease, (c) to show the
Demised Premises or the Property to any prospective tenant or purchaser, and (d)
for any other reasonable purpose. If Tenant changes the locks on the Demised
Premises, Tenant must provide Landlord with a copy of each separate key. During
the final one hundred fifty (150) days of the Lease Term, Landlord and
Landlord's agents may erect and maintain on or about the Demised Premises signs
advertising the Demised Premises for lease or for sale.
6.07. Possession. If Tenant pays the rent, properly maintains the Demised
Premises, and complies with all other terms of this Lease, Tenant may occupy and
enjoy the Demised Premises for the full Lease Term, subject to the provisions of
this Lease
6.08. Exemptions from Liability. Landlord shall not be liable for any damage or
injury to the persons, business (or any loss of income), goods, inventory,
furnishings, fixtures, equipment, merchandise or other property of Tenant,
Tenant's employees, invitees, customers or any other person in or about the
Demised Premises, whether the damage or injury is caused by or results from. (a)
fire, steam, electricity, water, gas or wind; (b) the breakage, leakage,
obstruction or other defects of pipes, sprinklers, wires, appliances, plumbing,
air conditioning or lighting fixtures or any other cause; (c) conditions arising
on or about the Demised Premises or upon other portions of any building of which
the Demised Premises is a part, or from other sources or places; or (d) any act
or omission of any other tenant of any building on the Property. Landlord shall
not be liable for any damage or injury even though the cause of or the means of
repairing the damage or injury are not accessible to Tenant. The provisions of
this Section 6.08 shall not, however, exempt Landlord from liability for
Landlord's gross negligence or willful misconduct.
ARTICLE SEVEN: PROPERTY CONDITION, MAINTENANCE, REPAIRS AND ALTERATIONS
7.01. Property Condition. Except as disclosed in writing by Landlord to Tenant
contemporaneously with the execution of this Lease, to the best of Landlord's
actual knowledge the Demised Premises has no known latent structural defects,
construction defects of a material nature, and to the best of Landlord's actual
knowledge none of the improvements has been constructed with materials known to
be a potential health hazard to occupants of the Demised Premises. Tenant
acknowledges that neither the Principal Broker nor any Cooperating Broker has
made any warranty or representation to Tenant with respect to the condition of
the Demised Premises, and that Tenant is relying exclusively upon Tenant's own
investigations and the representations of Landlord, if any, with respect to the
condition of the Demised Premises. Landlord and Tenant agree to hold the Brokers
harmless of and from any and all damages, claims, costs and expenses of every
kind and character resulting from or related to Landlord's furnishing to the
Brokers any false, incorrect or inaccurate information with respect to the
Demised Premises, or Landlord's concealing any material information with respect
to the condition of the Demised Premises. Other than as expressly set forth in
this Lease, Landlord represents that on the Commencement Date (and for a period
of thirty (30) days thereafter) the building fixtures and equipment, plumbing
and plumbing fixtures, electrical and lighting system, any fire protection
sprinkler system, ventilating equipment, heating system, air conditioning
equipment, roof, skylights, doors, overhead doors, windows, dock levelers,
elevators, and the interior of the Demised Premises in general are in good
operating condition Tenant shall have a period of thirty (30) days following the
Commencement Date in which to inspect the Demised Premises and to notify
Landlord in writing of any defects and maintenance, repairs or replacements
required to the above named equipment, fixtures, systems and interior. Within a
reasonable period of time after the timely receipt of any such written notice
from Tenant, Landlord shall, at Landlord's expense, correct the defects and
perform the maintenance, repairs and replacements.
7.02. Acceptance of Demised Premises. Subject to the provisions in Section
7.01, Tenant acknowledges that: (a) a full and complete inspection of the
Demised Premises and adjacent common areas has been made and Landlord has fully
and adequately disclosed the existence of any defects which would interfere with
Tenant's use of the Demised Premises for their intended commercial purpose, and
(b) as a result of such inspection and disclosure, Tenant has taken possession
of the Demised Premises and accepts the Demised Premises in its "As Is"
condition.
7.03. Maintenance and Repair. Except as otherwise provided in this Lease,
Landlord shall be under no obligation to perform any repair, maintenance or
management service in the Demised Premises or adjacent common areas. Tenant
shall be fully responsible, at its expense, for all repair, maintenance and
management services other than those which are expressly assumed by Landlord.
A. Landlord's Obligation.
(1) Subject to the provisions of Article Eight (Damage or
Destruction) and Article Nine (Condemnation) and except for damage caused by any
act or omission of Tenant, Landlord shall keep the roof, skylights, foundation,
structural components and the structural portions of exterior walls of the
Demised Premises in good order, condition and repair. Landlord shall not be
obligated to maintain or repair windows, doors, overhead doors, plate glass or
the surfaces of walls. In addition, Landlord shall not be obligated to make any
repairs under this Section until a reasonable time after receipt of written
notice from Tenant of the need for repairs. If any repairs are required to be
made by Landlord, Tenant shall, at Tenant's sole cost and expense, promptly
remove Tenant's furnishings, fixtures, inventory, equipment and other property,
to the extent required to enable Landlord to make repairs. Landlord's liability
under this Section shall be limited to the cost of those repairs or corrections.
Tenant waives the benefit of any present or future law which might give Tenant
the right to repair the Demised Premises at Landlord's expense or to terminate
the Lease because of the condition.
(2) All repair, maintenance, management and other services to be
performed by Landlord or Landlord's agents involve the exercise of professional
judgment by service providers, and Tenant expressly waives any claims for breach
of warranty arising from the performance of those services.
B. Tenant's Obligation.
(1) Subject to the provisions of Section 7.01, Section 7.03.A,
Article Eight (Damage or Destruction) and Article Nine (Condemnation), Tenant
shall, at all times, keep all other portions of the Demised Premises in good
order, condition and repair, ordinary wear and tear excepted, including but not
limited to maintenance, repairs and all necessary replacements of the windows,
plate glass, doors, overhead doors, heating system, ventilating equipment, air
conditioning equipment, electrical and lighting systems, fire protection
sprinkler system, dock levelers, elevators, interior and exterior plumbing, the
interior of the Demised Premises in general, pest control and extermination,
downspouts, gutters, paving railroad siding, care of landscaping and regular
mowing of grass, and including the exterior of the Demised Premises. In
addition, Tenant shall, at Tenant's expense, repair any damage to any portion of
the Property, including the roof, skylights, foundation, or structural
components and exterior walls of the Demised Premises, caused by Tenant's acts
or omissions. If Tenant fails to maintain and repair the Property as required by
this Section, Landlord may, on ten (10) days' prior written notice, enter the
Demised Premises and perform the maintenance or repair on behalf of Tenant,
except that no notice is required in case of emergency, and Tenant shall
reimburse Landlord immediately upon demand for all costs incurred in performing
the maintenance or repair, plus a reasonable service charge.
(2) HVAC Service. Tenant shall, at Tenant's own cost and expense,
enter into a regularly scheduled preventative maintenance and service contract
for all refrigeration, heating, ventilating, and air conditioning systems and
equipment within the Demised Premises during the Lease Term. If Tenant fails to
enter into such a service contract acceptable to Landlord, Landlord may do so on
Tenant's behalf and Tenant agrees to pay Landlord the cost and expense thereof,
plus a reasonable service charge, regularly upon demand
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7.04. Alterations, Additions and Improvements. Tenant shall not create any
openings in the roof or exterior walls, or make any alterations, additions or
improvements to the Demised Premises without the prior written consent of
Landlord. Consent for non-structural alterations, additions or improvements
shall not be unreasonably withheld by Landlord. Tenant may erect or install
trade fixtures, shelves, bins, machinery, heating, ventilating and air
conditioning equipment and, provided that Tenant complies with all applicable
governmental laws, ordinances, codes, and regulations. At the expiration or
termination of this Lease, Tenant shall, subject to the restrictions of Section
7.05 below, have the right to remove items installed by Tenant, provided Tenant
is not in default at the time of the removal and provided further that Tenant
shall, at the time of removal of the items, repair in a good and workmanlike
manner any damage caused by the installation or removal Tenant shall pay for all
costs incurred or arising out of alterations, additions or improvements in or to
the Demised Premises and shall not permit any mechanic's or materialman's lien
to be filed against the Demised Premises or the Property. Upon request by
Landlord, Tenant shall deliver to Landlord proof of payment reasonably
satisfactory to Landlord of all costs incurred or arising out of any
alterations, additions or improvements.
7.05. Condition upon Termination. Upon the expiration or termination of this
Lease, Tenant shall surrender the Demised Premises to Landlord broom clean and
in the same condition as received, except for ordinary wear and tear which
Tenant is not otherwise obligated to remedy under any provision of this Lease.
Tenant shall not be obligated to repair any damage which Landlord is required to
repair under Article Seven (Property Condition) or Article Eight (Damage or
Destruction). In addition, Landlord may require Tenant to remove any
alterations, additions or improvements (whether or not made with Landlord's
consent) prior to the expiration or termination of this Lease and to restore the
Demised Premises to its prior condition, all at Tenant's expense. All
alterations, additions and improvements which Landlord has not required Tenant
to remove shall become Landlord's property and shall be surrendered to Landlord
upon the expiration or termination of this Lease. In no event, however, shall
Tenant remove any of the following materials or equipment without Landlord's
prior written consent: (i) any electrical wiring or power panels; (ii) lighting
or lighting fixtures; (iii) wall coverings, drapes, blinds or other window
coverings; (iv) carpets or other floor coverings; (v) heating, ventilating, or
air conditioning equipment; (vi) fencing or security gates; or (vii) any other
fixtures, equipment or items which, if removed, would affect the operation or
the exterior appearance of the Property.
ARTICLE EIGHT: DAMAGE OR DESTRUCTION
8.01. Notice. If any buildings or other improvements situated on the Property
are damaged or destroyed by fire, flood, windstorm, tornado or other casualty,
Tenant shall immediately give written notice of the damage or destruction to
Landlord.
8.02. Partial Damage. If the building or other improvements situated on the
Demised Premises are damaged by fire, tornado, or other casualty but not to such
an extent that rebuilding or repairs cannot reasonably be completed within one
hundred twenty (120) days from the date Landlord receives written notification
by Tenant of the occurrence of the damage, this Lease shall not terminate, but
Landlord shall proceed with reasonable diligence to rebuild or repair the
building and other improvements on the Demised Premises (other than leasehold
improvements made by Tenant or any assignee, subtenant or other occupant of the
Demised Premises) to substantially the condition in which they existed prior to
the damage. If the casualty occurs during the final eighteen (18) months of the
Lease Term, Landlord shall not be required to rebuild or repair the damage
unless Tenant exercises Tenant's renewal option (if any) within fifteen (15)
days after the date of receipt by Landlord of the notification of the occurrence
of the damage. If Tenant does not exercise its renewal option, or if there is no
renewal option contained in this Lease, Landlord may, at Landlord's option,
terminate this Lease by promptly delivering a written termination notice to
Tenant, in which event the Rent shall be abated for the unexpired portion of the
Lease Term, effective from the date of receipt by Landlord of the written
notification of the damage. To the extent the Demised Premises cannot be
occupied (in whole or in part) following the casualty, the Rent payable under
this Lease during the period in which the Demised Premises cannot be fully
occupied shall be adjusted equitably.
8.03. Substantial or Total Destruction. If the building or other improvements
situated on the Demised Premises are substantially or totally destroyed by fire,
tornado, or other casualty, or so damaged that rebuilding or repairs cannot
reasonably be completed within one hundred twenty (120) days from the date
Landlord receives written notification by Tenant of the occurrence of the
damage, either Landlord or Tenant may terminate this Lease by promptly
delivering a written termination notice to the other party, in which event the
monthly installments of Rent shall be abated for the unexpired portion of the
Lease Term, effective from the date of the damage or destruction. If neither
party promptly terminates this Lease, Landlord shall proceed with reasonable
diligence to rebuild and repair the building and other improvements (except that
Tenant shall rebuild and repair Tenant's fixtures and improvements in the
Demised Premises). To the extent the Demised Premises
cannot be occupied (in whole or in part) following the casualty, the Rent
payable under this Lease during the period in which the Demised Premises cannot
be fully occupied shall be adjusted equitably.
ARTICLE NINE: CONDEMNATION
If, during the Lease Term or any extension thereof, all or a substantial part of
the Demised Premises are taken for any public or quasi-public use under any
governmental law, ordinance or regulation or by right of eminent domain, or are
conveyed to the condemning authority under threat of condemnation, this Lease
shall terminate and the monthly installments of Rent shall be abated during the
unexpired portion of the Lease Term, effective from the date of the taking. If
less than a substantial part of the Demised Premises is taken for public or
quasi-public use under any governmental law, ordinance or regulation, or by
right of eminent domain, or is conveyed to the condemning authority under threat
of condemnation, Landlord, at its option, may by written notice terminate this
Lease. If Landlord does not terminate this Lease, Landlord shall promptly, at
Landlord's expense, restore and reconstruct the buildings and improvements
(other than leasehold improvements made by Tenant or any assignee, subtenant or
other occupant of the Demised Premises) situated on the Demised Premises in
order to make the same reasonably tenantable and suitable for the use for which
the Demised Premises is leased as defined in Section 6.01. The monthly
installments of Rent payable under this Lease during the unexpired portion of
the Lease Term shall be adjusted equitably. Landlord and Tenant shall each be
entitled to receive and retain such separate awards and portions of lump sum
awards as may be allocated to their respective interests in any condemnation
proceeding. The termination of this Lease shall not affect the rights of the
parties to such awards.
ARTICLE TEN: ASSIGNMENT AND SUBLETTING
Tenant shall not, without the prior written consent of Landlord, assign this
Lease or sublet the Demised Premises or any portion thereof. Any assignment or
subletting shall be expressly subject to all terms and provisions of this Lease,
including the provisions of Section 6.01 pertaining to the use of the Demised
Premises. In the event of any assignment or subletting, Tenant shall remain
fully liable for the full performance of all Tenant's obligations under this
Lease. Tenant shall not assign its rights under this Lease or sublet the Demised
Premises without first obtaining a written agreement from the assignee or
sublessee whereby the assignee or sublessee agrees to assume the obligations of
Tenant under this Lease and to be bound by the terms of this Lease. If an event
of default occurs while the Demised Premises is assigned or sublet, Landlord
may, at Landlord's option, in addition to any other remedies provided in this
Lease or by law, collect directly from the assignee or subtenant all rents
becoming due under the terms of the assignment or subletting and apply the rent
against any sums due to Landlord under this Lease. No direct collection by
Landlord from any assignee or subtenant will release Tenant from Tenant's
obligations under this Lease.
ARTICLE ELEVEN: DEFAULT AND REMEDIES
11.01. Default. Each of the following events is an event of default under this
Lease:
A. Failure of Tenant to pay any installment of the Rent or other sum
payable to Landlord under this Lease on the date that it is due and the
continuance of that failure for a period of five (5) days after Landlord
delivers written notice of the failure to Tenant. This clause shall not be
construed to permit or allow a delay in paying Rent beyond the due date and
shall not affect Landlord's right to impose a Late Charge as permitted in
Section 3.03.
B. Failure of Tenant to comply with any term, condition or covenant of
this Lease, other than the payment of Rent or other sum of money, and the
continuance of that failure for a period of thirty (30) days after Landlord
delivers written notice of the failure to Tenant;
C. Failure of Tenant or any guarantor of Tenant's obligations under this
Lease to pay its debts as they become due or an admission in writing of
inability to pay its debts, or the making of a general assignment for the
benefit of creditors;
Page 5
D. The commencement by Tenant or any guarantor of Tenant's obligations
under this Lease of any case, proceeding or other action seeking reorganization,
arrangement, adjustment, liquidation, dissolution or composition of it or its
debts under any law relating to bankruptcy, insolvency, reorganization or relief
of debtors, or seeking appointment of a receiver, trustee, custodian or other
similar official for it or for all or any substantial part of its property;
E. The commencement of any case, proceeding or other action against
Tenant or any guarantor of Tenant's obligations under this Lease seeking to have
an order for relief entered against it as debtor, or seeking reorganization,
arrangement, adjustment, liquidation, dissolution or composition of it or its
debts under any law relating to bankruptcy, insolvency, reorganization or relief
of debtors, or seeking appointment of a receiver, trustee, custodian or other
similar official for it or for all or any substantial part of its property, and
Tenant or any guarantor: (i) fails to obtain a dismissal of such case,
proceeding, or other action within sixty (60) days of its commencement; or (ii)
converts the case from one chapter of the Federal Bankruptcy Code to another
chapter, or (iii) is the subject of an order of relief which is not fully stayed
within seven (7) business days after the entry thereof; and
F. Vacancy or abandonment by Tenant of any substantial portion of the
Demised Premises or cessation of the use of the Demised Premises for the purpose
leased.
11.02. Remedies. Upon the occurrence of any of the events of default listed in
Section 11.01, Landlord shall have the option to pursue any one or more of the
following remedies without any prior notice or demand.
A. Terminate this Lease, in which event Tenant shall immediately
surrender the Demised Premises to Landlord. If Tenant fails to so surrender the
Demised Premises, Landlord may, without prejudice to any other remedy which it
may have for possession of the Demised Premises or Rent in arrears, enter upon
and take possession of the Demised Premises and expel or remove Tenant and any
other person who may be occupying the Demised Premises or any part thereof, by
force if necessary, without being liable for prosecution or any claim for
damages. Tenant shall pay to Landlord on demand the amount of all loss and
damage which Landlord may suffer by reason of the termination, whether through
inability to relet the Demised Premises on satisfactory terms or otherwise.
B. Enter upon and take possession of the Demised Premises, by force if
necessary, without terminating this Lease and without being liable for
prosecution or for any claim for damages, and expel or remove Tenant and any
other person who may be occupying the Demised Premises or any part thereof.
Landlord may relet the Demised Premises and receive the rent therefor. Tenant
agrees to pay to Landlord monthly or on demand from time to time any deficiency
that may arise by reason of any such reletting. In determining the amount of the
deficiency, the professional service fees, attorneys' fees, court costs,
remodeling expenses and other costs of reletting shall be subtracted from the
amount of rent received under the reletting.
C. Enter upon the Demised Premises, by force if necessary, without
terminating this Lease and without being liable for prosecution or for any claim
for damages, and do whatever Tenant is obligated to do under the terms of this
Lease. Tenant agrees to pay Landlord on demand for expenses which Landlord may
incur in thus effecting compliance with Tenant's obligations under this Lease,
together with interest thereon at the rate of twelve percent (12%) per annum
from the date expended until paid. Landlord shall not be liable for any damages
resulting to Tenant from such action, whether caused by negligence of Landlord
or otherwise.
D. Accelerate and declare the Rent for the entire Lease Term, and all
other amounts due under this Lease, at once due and payable, and proceed by
attachment, suit or otherwise, to collect all amounts in the same manner as if
all such amounts due or to become due during the entire Lease Term were payable
in advance by the terms of this Lease, and neither the enforcement or collection
by Landlord of such amounts nor the payment by Tenant of such amounts shall
constitute a waiver by Landlord of any breach, existing or in the future, of any
of the terms or provisions of this Lease by Tenant or a waiver of any rights or
remedies which the Landlord may have with respect to any such breach
E. In addition to the foregoing remedies, Landlord shall have the right
to change or modify the locks on the Demised Premises in the event Tenant fails
to pay the monthly installment of Rent when due. Landlord shall not be obligated
to provide another key to Tenant or allow Tenant to regain entry to the Demises
Premises unless and until Tenant pays Landlord all Rent which is delinquent.
Tenant agrees that Landlord shall not be liable for any damages resulting to the
Tenant from the lockout. At such time that Landlord changes or modifies the
lock, Landlord shall post a "Notice of Change of Locks" on the front of the
Demised Premises. Such Notice shall state that:
(1) Tenant's monthly installment of Rent is delinquent, and
therefore, under authority of Section 11.02 E of Tenant's Lease, the Landlord
has exercised its contractual right to change or modify Tenant's door locks;
(2) The Notice has been posted on the Tenant's front door by a
representative of Landlord and Tenant should make arrangements with the
representative to pay the delinquent installments of Rent when Tenant picks up
the key; and
(3) The failure of Tenant to comply with the provisions of the Lease
and the Notice and/or tampering with or changing the door lock(s) by Tenant may
subject Tenant to legal liability.
F. No re-entry or taking possession of the Demised Premises by Landlord
shall be construed as an election to terminate this Lease, unless a written
notice of that intention is given to Tenant. Notwithstanding any such reletting
or re-entry or taking possession, Landlord may, at any time thereafter, elect to
terminate this Lease for a previous default. Pursuit of any of the foregoing
remedies shall not preclude pursuit of any other remedies provided by law, nor
shall pursuit of any remedy provided in this Lease constitute a forfeiture or
waiver of any monthly installment of Rent due to Landlord under this Lease or of
any damages accruing to Landlord by reason of the violation of any of the terms,
provisions and covenants contained in this Lease. Failure of Landlord to declare
any default immediately upon its occurrence, or failure to enforce one or more
of Landlord's remedies, or forbearance by Landlord to enforce one or more of
Landlord's remedies upon an event of default shall not be deemed or construed to
constitute a waiver of default or waiver of any violation or breach of the terms
of this Lease. Pursuit of any one of the above remedies shall not preclude
pursuit by Landlord of any of the other remedies provided in this Lease. The
loss or damage that Landlord may suffer by reason of termination of this Lease
or the deficiency from any reletting as provided for above shall include the
expense of repossession and any repairs or remodeling undertaken by Landlord
following possession. If Landlord terminates this Lease at any time for any
default, in addition to other remedies Landlord may have, Landlord may recover
from Tenant all damages Landlord may incur by reason of the default, including
the cost of recovering the Demised Premises and the cost of the Rent then
remaining unpaid.
11.03. Notice of Default. Tenant shall give written notice of any failure by
Landlord to perform any of Landlord's obligations under this Lease to Landlord
and to any ground lessor, mortgagee or beneficiary under any deed of trust
encumbering the Demised Premises whose name and address have been furnished to
Tenant in writing. Landlord shall not be in default under this Lease unless
Landlord (or such ground lessor, mortgagee or beneficiary) fails to cure the
nonperformance within thirty (30) days after receipt of Tenant's notice.
However, if the nonperformance reasonably requires more than thirty (30) days to
cure, Landlord shall not be in default if the cure is commenced within the 30-
day period and is thereafter diligently pursued to completion.
11.04. Limitation of Landlord's Liability. As used in this Lease, the term
"Landlord" means only the current owner or owners of the fee title to the
Demised Premises or the leasehold estate under a ground lease of the Demised
Premises at the time in question. Each Landlord is obligated to perform the
obligations of Landlord under this Lease only during the time such Landlord owns
such interest or title. Any Landlord who transfers its title or interest is
relieved of all liability with respect to the obligations of Landlord under this
Lease accruing on or after the date of transfer, and Tenant agrees to recognize
the transferee as Landlord under this Lease. However, each Landlord shall
deliver to its transferee the Security Deposit held by Landlord if such Security
Deposit has not then been applied under the terms of this Lease
ARTICLE TWELVE: LANDLORD'S CONTRACTUAL LIEN
[Article deleted]
Page 6
ARTICLE THIRTEEN: PROTECTION OF LENDERS
13.01. Subordination and Attornment. Landlord shall have the right to
subordinate this Lease to any future ground Lease, deed of trust or mortgage
encumbering the Demised Premises, and advances made on the security thereof and
any renewals, modifications, consolidations, replacements or extensions thereof,
whenever made or recorded. Landlord's right to obtain such a subordination is
subject to Landlord's providing Tenant with a written Subordination,
Nondisturbance and Attornment Agreement from the ground lessor, beneficiary or
mortgagee wherein Tenant's right to peaceable possession of the Demised Premises
during the Lease Term shall not be disturbed if Tenant pays the Rent and
performs all of Tenant's obligations under this Lease and is not otherwise in
default, in which case Tenant shall attorn to the transferee of or successor to
Landlord's interest in the Demised Premises and recognize the transferee or
successor as Landlord under this Lease. If any ground lessor, beneficiary or
mortgagee elects to have this Lease superior to the lien of its ground lease,
deed of trust or mortgage and gives Tenant written notice thereof, this Lease
shall be deemed superior to the ground lease, deed of trust or mortgage whether
this Lease is dated prior or subsequent to the date of the ground lease, deed of
trust or mortgage or the date of recording thereof. Tenant's rights under this
Lease, unless specifically modified at the time this Lease is executed, are
subordinated to any existing ground lease, deed of trust or mortgage encumbering
the Demised Premises.
13.02. Signing of Documents. Tenant shall sign and deliver any instruments or
documents necessary or appropriate to evidence any attornment or subordination
or any agreement to attorn or subordinate. If Tenant fails to do so within ten
(10) days after written request, Tenant hereby makes, constitutes and
irrevocably appoints Landlord, or any transferee or successor of Landlord, the
attorney-in-fact of Tenant to execute and deliver the attornment or
subordination document or agreement.
13.03. Estoppel Certificates.
A. Upon Landlord's written request, Tenant shall execute, acknowledge and
deliver to Landlord a written statement certifying. (i) that none of the terms
or provisions of this Lease have been changed (or if they have been changed,
stating how they have been changed), (ii) that this Lease has not been canceled
or terminated; (iii) the last date of payment of the Base Rent and other charges
and the time period covered by that payment; and (iv) that Landlord is not in
default under this Lease (or, if Landlord is claimed to be in default, stating
why). Tenant shall deliver the statement to Landlord within ten (10) days after
Landlord's request. Landlord may forward any such statement to any prospective
purchaser or lender of the Demised Premises. The purchaser or lender may rely
conclusively upon the statement as true and correct
B. If Tenant does not deliver the written statement to Landlord within
the 10-day period, Landlord, and any prospective purchaser of lender, may
conclusively presume and rely upon the following facts: (i) that the terms and
provisions of this Lease have not been changed except as otherwise represented
by Landlord; (ii) that this Lease has not been canceled or terminated except as
otherwise represented by Landlord; (iii) that not more than one monthly
installment of Base Rent or other charges have been paid in advance, and (iv)
that Landlord is not in default under this Lease. In such event, Tenant shall be
estopped from denying the truth of the presumed facts.
13.04. Tenant's Financial Condition. Within ten (10) days after written request
from Landlord, Tenant shall deliver to Landlord financial statements as are
reasonably required by Landlord to verify the net worth of Tenant, or any
assignee, subtenant, or guarantor of Tenant. In addition, Tenant shall deliver
to any lender designated by Landlord any financial statements required by the
lender to facilitate the financing or refinancing of the Demised Premises.
Tenant represents and warrants to Landlord that each financial statement is a
true, complete, and accurate statement as of the date of the statement. All
financial statements shall be confidential and shall be used only for the
purposes set forth in this Lease.
ARTICLE FOURTEEN: ENVIRONMENTAL REPRESENTATIONS AND INDEMNITY
14.01. Tenant's Compliance with Environmental Laws. Tenant, at Tenant's
expense, shall comply with all laws, rules, orders, ordinances, directions,
regulations and requirements of Federal, State, county and municipal authorities
pertaining to Tenant's use of the Property and with the recorded covenants,
conditions and restrictions, regardless of when they become effective,
including, without limitation, all applicable Federal, State and local laws,
regulations or ordinances pertaining to air and water quality, Hazardous
Materials (as defined in Section 14.05), waste disposal, air emissions and other
environmental matters, all zoning and other land use matters, and with any
direction of any public officer or officers, pursuant to law, which impose any
duty upon Landlord or Tenant with respect to the use or occupancy of the
Property.
14.02. Tenant's Indemnification. Tenant shall not cause or permit any
Hazardous Materials to be brought upon, kept or used in or about the Property by
Tenant, its agents, employees, contractors or invitees without the prior written
consent of Landlord. If Tenant breaches the obligations stated in the preceding
Section or sentence, or if the presence of Hazardous Materials on the Property
caused or permitted by Tenant results in contamination of the Property or any
other property, or if contamination of the Property or any other property by
Hazardous Materials otherwise occurs for which Tenant is legally liable to
Landlord for damage resulting therefrom, then Tenant shall indemnify, defend and
hold Landlord harmless from any and all claims, judgments, damages, penalties,
fines, costs, liabilities or losses (including, without limitation, diminution
in value of the Property, damages for the loss or restriction on use of rentable
or unusable space or of any amenity or appurtenance of the Property, damages
arising from any adverse impact on marketing of building space or land area,
sums paid in settlement of claims, reasonable attorneys' fees, court costs,
consultant fees and expert fees) which arise during or after the Lease Term as a
result of the contamination. This indemnification of Landlord by Tenant
includes, without limitation, costs incurred in connection with any
investigation of site conditions or any clean-up, remedial work, removal or
restoration work required by any Federal, State or local government agency
because of Hazardous Materials present in the soil or ground water on or under
the Property. Without limiting the foregoing, if the presence of any Hazardous
Materials on the Property (or any other property) caused or permitted by Tenant
results in any contamination of the Property, Tenant shall promptly take all
actions at Tenant's sole expense as are necessary to return the Property to the
condition existing prior to the introduction of any such Hazardous Materials,
provided that Landlord's approval of such actions is first obtained. The
foregoing indemnity shall survive the expiration or termination of this Lease.
14.03. Landlord's Representations and Warranties. Landlord represents and
warrants, to the best of Landlord's actual knowledge, that: (i) any handling,
transportation, storage, treatment or usage of Hazardous Materials that has
occurred on the Property to date has been in compliance with all applicable
Federal, State, and local laws, regulations and ordinances, and (ii) no leak,
spill, release, discharge, emission or disposal of Hazardous Materials has
occurred on the Property to date and that the soil or groundwater on or under
the Property is free of Hazardous Materials as of the Commencement Date, unless
expressly disclosed by Landlord to Tenant in writing.
Page 7
14.04. Landlord's Indemnification. Landlord hereby indemnifies, defends and
holds Tenant harmless from any claims, judgments, damages, penalties, fines,
costs, liabilities, (including sums paid in settlements of claims) or loss,
including, without limitation, attorneys fees, court costs, consultant fees, and
expert fees, which arise during or after the term of this Lease from or in
connection with the presence of suspected presence of Hazardous Materials in the
soil or groundwater on or under the Property, unless the Hazardous Material is
released by Tenant or is present solely as a result of the negligence or willful
conduct of Tenant. Without limiting the generality of the foregoing, the
indemnification provided by this Section 14.04 shall specifically cover costs
incurred in connection with any investigation of site conditions or any clean-
up, remedial work, removal or restoration work required by any Federal, State or
local governmental authority.
14.05. Definition. For purposes of this Lease, the term "Hazardous Materials"
means any one or more pollutant, toxic substance, hazardous waste, hazardous
material, hazardous substance, solvent or oil as defined in or pursuant to the
Resource Conservation and Recovery Act, as amended, the Comprehensive
Environmental Response, Compensation and Liability Act, as amended, the Federal
Clean Water Act, as amended, or any other Federal, State or local environmental
law, regulation, ordinance, or rule, whether existing as of the date of this
Lease or subsequently enacted.
14.06. Survival. The representations and indemnities contained in this
Article 14 shall survive the expiration or termination of this Lease
ARTICLE FIFTEEN: PROFESSIONAL SERVICE FEES
ARTICLE SIXTEEN: MISCELLANEOUS
16.01. Disclosure. Landlord and Tenant understand that a real estate broker
is qualified to advise on matters concerning real estate and is not expert in
matters of law, tax, financing, surveying, hazardous materials, engineering,
construction, safety, zoning, land planning, architecture or the ADA. The
Brokers hereby advise Tenant to seek expert assistance on such matters. Brokers
do not investigate a property's compliance with building codes, governmental
ordinances, statutes and laws that relate to the use or condition of a property
and its construction, or that relate to its acquisition. If Brokers provide
names of consultants or sources for advice or assistance, Tenant acknowledges
that the Brokers do not warrant the services of the advisors or their products
and cannot warrant the suitability of property to be acquired or leased.
Furthermore, the Brokers do not warrant that the Landlord will disclose any or
all property defects, although the Brokers will disclose to Tenant any actual
knowledge possessed by Brokers regarding defects of the Demised Premises and the
Property. In this regard, Tenant agrees to make all necessary and appropriate
inquiries and to use diligence in investigating the Demised Premises and the
Property before consummating this Lease. Landlord and Tenant hereby agree to
indemnify, defend, and hold the Brokers harmless of and from any and all
liabilities, claims, debts, damages, costs, or expenses, including but not
limited to reasonable attorneys' fees and court costs, related to or arising out
of or in any way connected to representations concerning matters properly the
subject of advice by experts. In addition, to the extent permitted by applicable
law, the Brokers' liability for errors or omissions, negligence, or otherwise,
is limited to the return of the Fee, if any, paid to the Brokers pursuant to
this Lease
Page 8
16.02. Force Majeure. If performance by Landlord of any term, condition or
covenant in this Lease is delayed or prevented by any Act of God, strike,
lockout, shortage of material or labor, restriction by any governmental
authority, civil riot, flood, or any other cause not within the control of
Landlord, the period for performance of the term, condition or covenant shall be
extended for a period equal to the period Landlord is so delayed or prevented.
16.03. Interpretation. The captions of the Articles or Sections of this Lease
are to assist the parties in reading this Lease and are not a par part of the
terms or provisions of this Lease. Tenant shall be responsible for the conduct,
acts and omissions of Tenant's agents, employees, customers, contractors,
invitees, agents, successors or others using the Demised Premises with Tenant's
expressed or implied permission. Whenever required by the context of this Lease,
the singular shall include the plural and the plural shall include the singular,
and the masculine, feminine and neuter genders shall each include the other.
16.04. Waivers. All waivers to provisions of this Lease must be in writing and
signed by the waiving party. Landlord's delay or failure to enforce any
provisions of this Lease or its acceptance of late installments of Rent shall
not be a waiver and shall not prevent Landlord from enforcing that provision or
any other provision of this Lease in the future. No statement on a payment check
from Tenant or in a letter accompanying a payment check shall be binding on
Landlord. Landlord may, with or without notice to Tenant, negotiate, cash, or
endorse the check without being bound to the conditions of any such statement.
16.05. Severability. A determination by a court of competent jurisdiction that
any provision of this Lease is invalid or unenforceable shall not cancel or
invalidate the remainder of that provision or this Lease, which shall remain in
full force and effect.
16.06. Joint and Several Liability. All parties signing this Lease as Tenant
shall be jointly and severally liable for all obligations of Tenant.
16.07. Amendments or Modifications. This Lease is the only agreement between
the parties pertaining to the lease of the Demised Premises and no other
agreements are effective unless made a part of this Lease. All amendments to
this Lease must be in writing and signed by all parties. Any other attempted
amendment shall be void.
16.08. Notices. All notices and other communications required or permitted
under this Lease must be in writing and shall be deemed delivered, whether
actually received or not, on the earlier of: (i) actual receipt if delivered in
person or by messenger with evidence of delivery; or (ii) receipt of an
electronic facsimile transmission ("Fax"); or (iii) upon deposit in the United
States Mail as required below. Notices may be transmitted by Fax to the Fax
telephone numbers specified in Article One on the first page of this Lease, if
any. Notices delivered by mail must be deposited in the U.S. Postal Service,
first class postage prepaid, and properly addressed to the intended recipient as
set forth in Article One After possession of the Demised Premises by Tenant,
Tenant's address for notice purposes will be the address of the Demised Premises
unless Tenant notifies Landlord in writing of a different address to be used for
that purpose. Any party may change its address for notice by delivering written
notice of its new address to all other parties in the manner set forth above.
Copies of all notices should also be delivered to the Principal Broker, but
failure to notify the Principal Broker will not cause an otherwise properly
delivered notice to be ineffective.
16.09. Attorneys' Fees. If on account of any breach or default by any party to
this Lease in its obligations to any other party to this Lease including but not
limited to the Principal Broker), it becomes necessary for a party to employ an
attorney to enforce or defend any of its rights or remedies under this Lease,
the non-prevailing party agrees to pay the prevailing party its reasonable
attorneys' fees and court costs, if any, whether or not suit is instituted in
connection with the enforcement or defense.
16.10. Venue. All obligations under this Lease, including but not limited to
the payment of Fees to the Principal Broker, shall be performable and payable in
the county in which the Property is located. The laws of the State of Texas
shall govern this Lease.
16.11. Survival. All obligations of any party to this Lease which are not
fulfilled at the expiration or the termination of this Lease shall survive such
expiration or termination as continuing obligations of the party.
16.12. Binding Effect. This Lease shall inure to the benefit of, and be
binding upon, each of the parties to this Lease and their respective heirs,
representatives, successors and assigns. However, Landlord shall not have any
obligation to Tenant's successors or assigns unless the rights or interests of
the successors or assigns are acquired in accordance with the terms of this
Lease.
16.13. Consult an Attorney. This Lease is an enforceable, legally binding
agreement. Read it carefully. The brokers involved in the negotiation of this
Lease cannot give you legal advice. The parties to this Lease acknowledge that
they have been advised by the Brokers to have this Lease reviewed by competent
legal counsel of their choice before signing this Lease. By executing this
Lease, Landlord and Tenant each agree to the provisions, terms, covenants and
conditions contained in this Lease.
16.14. Offer: The execution of this Lease by the first party to do so
constitutes an offer to lease the Demised Premises. Unless within the number of
days stated in Section 1.14 above after the date of its execution by the first
party to do so, this Lease is signed by the other party and a fully executed
copy is delivered to the first party, such offer to lease shall be automatically
withdrawn and terminated.
ARTICLE SEVENTEEN: ADDITIONAL PROVISIONS [Additional provisions as directed by
the parties may be set forth below.]
1. Tenant finish out will be completed and paid for as described
in Exhibit D.
2. Not withstanding anything contained herein to the contrary,
Addendum H is attached with certain additional conditions, which
if there is any conflict with the Lease document, Addendum H will
be superior as to rights and conditions for the Lease Term.
LANDLORD TENANT
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Efficient Networks, Inc.
---------------- -----------------------
By [Signature]: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ By [Signature]: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
--------------------- --------------------
Name: _______________________________ Name: ▇▇▇▇ ▇▇▇▇▇▇▇
Title: ______________________________ Title: CFO
Date of Execution: __________________ Date of Execution: 9/8/98
PRINCIPAL BROKER COOPERATING BROKER
The Worth Company
-----------------
By [Signature]: /s/ ▇▇▇▇▇ ▇. Worth By [Signature]: N/A
--------------------- --------------------
Name: ▇▇▇▇▇ ▇. Worth Name: _____________________________
Title: SVP Title: ___________________________
Copyright Notice: This form is provided for the use of members of the North
Texas Commercial Association of Realtors, Inc. Permission is hereby granted to
make limited copies of this form for use in a particular Texas real estate
transaction. Contact the NTCAR office to confirm that you are using the current
version of this form
Page 9
EXHIBIT A
GRAYSTONE OFFICE PARK
3310 ▇▇▇▇▇▇ Springs
Suite 120 11340
[map omitted]
EXHIBIT C
REGISTRATION LETTER AND COMMISSION AGREEMENT THE WORTH COMPANY
REGISTRATION
------------
This agreement, when signed by the Agent and Landlord will serve as a
Registration Agreement between The Worth Company (hereinafter known as "Agent")
and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ (hereinafter known as "Landlord") for Graystone Office Park
--------------- ---------------------
(the "Building"), located at 3310 ▇▇▇▇▇▇ Springs, of which a legal description
-------------------
of the location has been attached. Agent has satisfied the Registration
Requirements of Landlord, and has represented to Landlord that Agent is the
exclusive broker of Efficient Networks, Inc. (hereinafter referred to as
-----------------------
("Tenant"). Landlord agrees to recognize Tenant as Agent's Tenant for space
within the Building and agrees to pay a commission to Agent if a lease ("Lease")
is consummated between Tenant and Landlord.
COMMISSION
----------
Agent's commission for the Lease shall be calculated at the rate of four and
one-half percent (4 1/2%) of the gross rental consideration to be paid by Tenant
to Landlord, as set forth in the Lease, regardless of any cancellation option.
Such commission shall be paid in two (2) installments as follows: (i) one-half
(1/2) of such commission following the complete execution of the lease, and (ii)
the balance on the earlier to occur of (a) the first day that Tenant occupies
all or any portion of the space covered by the lease, or (b) commencement of the
term under the Lease, but no later than three (3) months after the date of
execution and delivery of the Lease. Agent's right to the second installment of
such commission shall rest upon such occupancy by Tenant provided, however, that
if Tenant never occupies the leased premises as a result of a breach or other
failure by Landlord to perform in accordance with the terms of the Lease
Agreement, then the remaining balance of the commission will nevertheless be due
and payable on the date on which the Tenant would have occupied leased premises
had such breach or other failure not occurred.
If Tenant's space is expanded or if the Lease is renewed, the commission in
relation to such renewal or expansion will be due and payable in full at the
time an addendum or new Lease covering the expansion or renewal is executed by
Landlord and Tenant, provided Agent actively participates in the new
negotiations for any such renewal and/or expansions on behalf of the Tenant, and
has received the Tenant's exclusive authorization to represent Tenant in those
new negotiations. Expansion options, including Rights of First Offer or Refusal,
exercised by Tenant under terms and conditions prenegotiated within the primary
lease document shall not require Agent involvement for payment of commissions.
Commissions for Lease renewals and expansions shall be computed in the same
manner as described above calculated at four and one-half percent (4 1/2%).
Agent is to be named in the lease document and the rights and obligations to pay
and receive any of the commissions described above are to inure to the benefit
or obligation of the heirs, successors and/or assigns of Agent. In the event of
a sale, assignment, or other conveyance or disposition of the Tenant's demised
premises, Landlord shall secure from the purchaser or assignee a written
recordable agreement by the purchaser or assignee assuming payment to Agent of
all commission payable hereunder. The terms "Landlord" and "Tenant" shall be
deemed to include any subsidiaries, affiliates, successors and nominees of the
same.
This registration of the Tenant with the Landlord shall remain in effect for one
hundred eighty (180) days after the date the Commission Agreement is signed by
the Landlord. Any extensions shall be by written agreement between Landlord and
Agent and shall be automatic, provided active negotiations and/or proposals are
evidenced and Agent is authorized to represent Tenant as its exclusive Agent.
ACKNOWLEDGED AND ACCEPTED BY:
AGENT: LANDLORD:
THE WORTH COMPANY ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------- -----------------
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇ ▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ BY: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ 8/10/98
----------------------------
▇▇▇-▇▇▇-▇▇▇▇ Date
ITS: _____________________________
BY: /s/ ▇▇▇▇▇ ▇. Worth 8-20-98 TITLE:____________________________
------------------------------
▇▇▇▇▇ ▇. Worth Date
Principal
EXHIBIT D
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
FAX (▇▇▇) ▇▇▇-▇▇▇▇
August 12, 1998
▇▇▇▇▇ Worth
The Worth Company
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇ ▇▇▇
▇▇ ▇▇
▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇ VIA FAX (▇▇▇) ▇▇▇-▇▇▇▇
----------------------
Re: Efficient Networks, Inc.
-----------------------------
This provides the Basis for a lease with Efficient Networks, Inc.
Location Graystone Office Park
--------
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇
Size - 11,320 sq. ft.
----
Term - 11/1/98 - 10/31/2001
----
Base Rate - $11.00 sq.ft. industrial gross
----------
Base Year for Expenses 1998
----------------------
Finish Out Repair and replace as necessary ceiling tiles light fixtures,
existing heating and air conditioning, plumbing fixtures, and
doors throughout lease space at Landlord's expense. Demise
space from Suite 105 at Landlord's expense. Repair wall damage.
Touch up and/or repaint as necessary entire lease space at
Landlord's expense. Construct vestibule around overhead door
and install drop ceiling at 9 feet in warehouse area at
Landlord's expense. Install new carpet in office areas,
excluding front executive area, at Landlord's expense. Install
anti-static tile in manufacturing areas (approximately 3,475
sq.ft.). Landlord will absorb $1.50 per sq.ft. of this cost.
Any incremental cost will be amortized over the term of the
lease at 5% interest rate and added to the base rental rate.
Any incremental heating and air conditioning required will be
amortized over the term of the lease at 5% interest rate and
added to the base rental
rate. For perspective, new heating and air conditioning cost is
roughly $1,200 per ton and my preliminary estimate is no more
than 7 1/2 tons will be required.
Occupancy - Front, executive area 11/1/98 with balance of space no later
than 11/15/98.
Non-Binding Acceptance- Please have Efficient Networks, Inc. sign below
their non-binding acceptance of the terms and
conditions above. Upon acceptance I will draft a
lease document for signing.
Sincerely,
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇
Efficient Network, Inc.
Date: 8/31/98
NORTH TEXAS COMMERCIAL ASSOCIATION OF REALTORS(R)
ADDENDUM A TO LEASE
EXPENSE REIMBURSEMENT
Demised Premises and Address: ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇. ▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇
--------------------------------------------------
[Check all boxes which apply. Boxes not checked do not apply to this Lease.]
1. Expense Reimbursement. Tenant shall pay the Landlord as additional Rent a
portion of the following expenses (collectively called "Reimbursement") which
are incurred by or assessed against the Demised Premises [check all that are to
apply]:
[X] Ad Valorem Taxes;
[X] Insurance Premiums;
[X] Common Area Maintenance (CAM) Expenses;
[X] Operating Expenses;
[X] Roof and Structural Maintenance Expenses;
2. Expense Reimbursement Limitations. The amount of Tenant's Reimbursement
shall be determined by one of the following methods as described in Section 4
below [check only one]:
[X] Base Year/Expense Stop Adjustment;
[ ] Pro Rata Adjustment;
[ ] Fixed Amount Adjustment;
[ ] Net Lease Provisions.
3. Expense Reimbursement Payments. Tenant agrees to pay any end-of-year lump
sum Reimbursement within thirty (30) days after receiving an invoice from
Landlord. Any time during the Lease Term (or any renewals or extensions)
Landlord may direct Tenant to pay monthly an estimated portion of the projected
future Reimbursement amount. Any such payment directed by Landlord shall be due
and payable monthly on the same day that the Base Rent is due. Any Reimbursement
relating to partial calendar years shall be prorated accordingly Tenant's Pro
Rata Share of such Reimbursements shall be based on the square footage of
useable area contained in the Demised Premises in proportion to the square
footage of useable building area of the Property. Tenant may audit or examine
those items of expense in Landlord's records which relate to Tenant's
obligations under this Lease. Landlord shall promptly refund to Tenant any
overpayment which is established by an audit or examination. If the audit or
examination reveals an error of more than five percent (5%) over the figures
billed to Tenant, Landlord shall pay the reasonable cost of the audit or
examination.
4. Definitions.
A. Ad Valorem Taxes. All general real estate taxes, general and special
assessments, parking surcharges, rent taxes, and other similar governmental
charges levied against the Property for each calendar year.
B. Insurance Premiums. All Landlord's insurance premiums attributable to
the Property, including but not limited to insurance for fire, casualty, general
liability, property damage, medical expenses, and extended coverage, and loss of
rents coverage for six months' Rent
C. Common Area Maintenance Charges. Common area maintenance expenses
("CAM") means all costs of maintenance, inspection and repairs of the common
areas of the Property, including but not limited to those costs for security,
lighting, painting, cleaning, decorations and fixtures, utilities, ice and snow
removal, trash disposal, project signs, minor roof defects, pest control,
project promotional expenses, property owners' association dues, wages and
salary costs of maintenance personnel, and other expenses benefiting all the
Property which may be incurred by Landlord, in its discretion, including sales
taxes and a reasonable service charge for the administration thereof. The
"common area" is defined as that part of the Property intended for the
collective use of all tenants including, but not limited to, the parking areas,
driveways, loading areas, landscaping, gutters and downspouts, plumbing,
electrical systems, roof, exterior walls, sidewalks, malls, promenades (enclosed
or otherwise), meeting rooms, doors, windows, corridors and public rest rooms.
CAM does not include depreciation on Landlord's original investment, cost of
tenant improvements, real estate brokers' fees, Landlord's management office and
overhead expenses, or interest or depreciation on capital investments.
D. Operating Expenses. All costs of ownership, building management,
maintenance, repairs and operation of the Property, including but not limited to
taxes, insurance, CAM, reasonable management fees, wages and salary costs of
building management personnel, overhead and operational costs of a management
office, janitorial, utilities, and professional services such as accounting and
legal fees. Operating Expenses do not include the capital cost of management
office equipment and furnishings, depreciation on Landlord's original
investment, roof and structural maintenance, the cost of tenant improvements,
real estate brokers' fees, advertising, or interest or depreciation on capital
investments.
E. Roof and Structural Maintenance Expenses. All costs of maintenance,
repair and replacement of the roof, roof deck, flashings, skylights, foundation,
floor slabs, structural components and the structural soundness of the building
in general.
F. Base Year/Expense Stop Adjustment. Tenant shall pay to Landlord as
additional rent Tenant's Pro Rata Share of increases in Landlord's Ad Valorem
Taxes, Insurance Premiums, CAM Expenses, Operating Expenses, and/or Roof and
Structural Maintenance Expenses, whichever are applicable, for the Property for
any calendar year during the Lease Term or during any extension of this Lease,
over [check only one]:
[X] (1) Such amounts paid by Landlord for the Base Year 1998, or
[ ] (2) $ __________________________ per square foot per year.
G. Pro Rata Adjustment. Tenant shall pay to Landlord as additional Rent
Tenant's Pro Rata Share of the total amount of Landlord's Ad Valorem Taxes,
Insurance Premiums, CAM, Operating Expenses, and/or Roof and Structural
Maintenance Expenses, whichever are applicable, for every calendar year during
the Lease Term and during any extension of this Lease.
H. Fixed Amount Adjustment. Tenant shall pay to Landlord as additional
Rent the following monthly amounts as Tenant's Reimbursement to Landlord for the
applicable expenses which are incurred by or assessed against the Property:
Ad Valorem Taxes $ ______________ per month.
Insurance Premiums $ ______________ per month.
CAM Expenses $ ______________ per month.
Operating Expenses $ ______________ per month.
Roof and Structural Maintenance Expenses $ ______________ per month.
I. Net Lease Provisions. Notwithstanding anything contained in this Lease
to the contrary in Article Seven or otherwise, Tenant shall be responsible for
paying Tenant's Pro Rata Share of all costs of ownership, maintenance, repairs,
replacements, and operation of the Demised Premises and the Property, including
but not limited to all costs of Ad Valorem Taxes, Insurance Premiums, CAM
Expenses, Operating Expenses, and Roof and Structural Maintenance Expenses.
5. [ ] Gross-Up Provisions. [Check this only if applicable.] If the Property
is a multi-tenant building and is not fully occupied during the Base Year or any
portion of the Lease Term, an adjustment shall be made in computing the variable
costs for each applicable calendar year. Variable costs shall include only those
items of expense that vary directly proportionately to the occupancy of the
Property. Variable costs which are included in the CAM and Operating Expenses
shall be increased proportionately to the amounts that, in Landlord's reasonable
judgment, would have been incurred had ninety percent (90%) of the useable area
of the Property been occupied during those years
Initials: Landlord ________________ Tenant _____________
NORTH TEXAS COMMERCIAL ASSOCIATION OF REALTORS(R)
ADDENDUM G TO LEASE
RULES AND REGULATIONS
Demised Premises and Address: ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇. ▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇
--------------------------------------------------
1. Application. The following standards shall affect and shall be observed by
Tenant, Tenant's employees and invitees, for the mutual safety, cleanliness,
care, protection, comfort and convenience of all tenants and occupants of the
Property, and shall be applicable to the building(s), to the parking garages, if
any, to the common areas, driveways, parking lots, and to the Demised Premises,
including the land situated beneath and any appurtenances thereto.
2. Consent Required. Any exception to these Rules and Regulations must first
be approved in writing by Landlord. For purposes of these Rules and Regulations,
the term "Landlord" includes the building manager, the building manager's
employees, and any other agent or designee authorized by Landlord to manage or
operate the Property.
3. Rules and Regulations:
A. Tenant may not conduct any auction, "flea market" or "garage sale" on
the Demised Premises nor store any goods or merchandise on the Property except
for Tenant's own business use. Food may not be prepared in the Demised Premises
except in small amounts for consumption by Tenant. Vending machines or
dispensing machines may not be placed in the Demised Premises without Landlord's
written approval. The Demised Premises may not be used or occupied as sleeping
quarters or for lodging purposes. Animals may not be kept in or about the
Property.
B. Tenant shall not obstruct sidewalks, driveways, loading areas, parking
areas, corridors, hallways, vestibules, stairs and other similar areas
designated for the collective use of tenants, or use such areas for Tenant's
storage, temporary or otherwise, or for any purpose other than ingress and
egress to and from the Demised Premises. Tenant shall comply with parking rules
and guidelines as may be posted on the Property from time to time.
C. Tenant shall not make any loud noises, unusual vibrations, unpleasant
odors, objectionable or illegal activities on the Property Tenant shall not
permit the operation of any equipment in the Demised Premises that could annoy
other occupants of the Property Tenant shall not interfere with the possession
of other tenants of the Property.
D. Tenant may not bring any flammable, explosive, toxic, noxious,
dangerous or hazardous materials onto the Property.
E. Installation of security systems, telephone, television and other
communication cables, fixtures and equipment must comply with Section 7.04 of
the Lease, except that routine installation and construction of normal
communication devices which do not require any holes in the roof or exterior
walls of the Property do not require the written approval of Landlord.
F. Movement into or out of the building through public entrances, lobbies
or corridors which requires use of a hand truck, dolly or pallet ▇▇▇▇ to carry
freight, furniture, office equipment, supplies and other large or heavy
material, must be limited to the service entrances and freight elevators only
and must be done at times and in a manner so as not to unduly inconvenience
other occupants of the Property. All wheels for such use must have rubber tires
and edge guards to prevent damage to the building. Tenant shall be responsible
for and shall pay all costs to repair damages to the building caused by the
movement of materials by Tenant.
G. Requests by Tenant for building services, maintenance and repair must
be made in writing to the office of the building manager designated by Landlord
and must be dated. Tenant shall give prompt written notice to Landlord of any
significant damage to or defects in the Demised Premises or the Property,
especially including plumbing, electrical and mechanical systems, heating,
ventilating and air conditioning systems, roofs, windows, doors, foundation and
structural components, regardless of whose responsibility it is to repair such
damage.
H. Tenant shall not change locks or install additional locks on doors
without the prior written consent of Landlord. If Tenant changes locks or
installs additional locks on the Property, Tenant shall within five days
thereafter provide Landlord with a copy of each
separate key to each lock. Upon termination of Tenant's occupancy of the Demised
Premises, Tenant must surrender all keys to the Demised Premises and to the
Property to Landlord.
I. Harmful liquids, toxic wastes, bulky objects, insoluble substances and
other materials which may cause clogging, stains or damage to plumbing fixtures
or systems must not be placed in the lavatories, water closets, sinks, or
drains. Tenant must pay the costs to repair and replace drains, plumbing
fixtures and piping which is required because of damage caused by Tenant.
J. Tenant shall cooperate with Landlord and other occupants of the
Property in keeping the Property and the Demised Premises neat and clean.
Nothing may be swept, thrown or left in the corridors, stairways, elevator
shafts, lobbies, loading areas, parking lots or any other common areas on the
Property. All trash and debris must be properly placed in receptacles provided
therefor.
K. Landlord has the power and authority to regulate the weight and
position of heavy furnishings and equipment on the floor of the Demised
Premises, including safes, groups of filing cabinets, machines, and any other
item which may overload the floor. Tenant shall notify the Landlord when heavy
items are to be taken into or out of the building, and the placement and
transportation of heavy items may be done only with the prior written approval
of Landlord.
L. No window screens, blinds, draperies, awnings, solar screen films,
window ventilators or other materials visible from the exterior of the Demised
Premises may be placed in the Demised Premises without Landlord's approval.
Landlord is entitled to control all lighting that may be visible from the
exterior of the building.
M. No advertisement, sign, notice, handbill, poster or banner may be
exhibited, distributed, painted or affixed upon the Property. No directory of
tenants is allowed on the Property other than that provided by Landlord.
N. Tenant agrees to cooperate with and assist Landlord in the prevention
of peddling, canvassing and soliciting on the Property.
O. Tenant accepts any and all liability for damages and injuries to
persons and property resulting from the serving and sales of alcoholic beverages
on or from the Property.
P. Any person entering and leaving the building before and after normal
working hours, or building hours if posted by Landlord, whichever applies, may
be required to identify himself to security personnel by signing a list and
giving the time of day and destination or location of the applicable Demised
Premises. Normal building business hours are established by Landlord from time
to time.
4. Revisions. Landlord reserves the right to revise and/or rescind any of
these Rules and Regulations and to make additional rules which Landlord may
determine are necessary from time to time for the safety, care, cleanliness,
protection, comfort and convenience of the tenants and occupants of the Property
and for the care, protection and cleanliness of the building. Revisions and
additions will be binding upon the Tenant as if they had been originally
prescribed herein when furnished in writing by Landlord to Tenant, provided the
additions and revisions apply equally to all tenants occupying the Property.
5. Enforcement. Any failure or delay by Landlord in enforcing these Rules and
Regulations will not prevent Landlord from enforcing these Rules and Regulations
in the future. If any of these Rules and Regulations is determined to be
unenforceable, it shall be severed from this Lease without affecting the
remainder of these Rules and Regulations.
Initials: Landlord ___________ Tenant _______________
Addendum H
1. Tenant to have the right to verify the square footage of the space with a
mutually agreed upon architect between Landlord and Tenant. If space is
greater or lesser than stated in the Lease of at least five-percent (5%) of
the stated total, the Base Rent will be adjusted accordingly. The Landlord
will pay the cost of the architect if the space is greater by five percent
(5%) of the amount stated in Article 1.04 B.
2. Article 1.14 is stricken from Lease.
3. Landlord grants consent to Tenant to affix a mutually approved sign on the
building, with approval given, subject to mutually agreed size, content and
location on the Demised Premises.
4. Quiet Enjoyment. Provided Tenant has performed all of the terms, covenants,
agreements and conditions of this Lease, including the payment of rent, to
be performed by Tenant, Tenant shall peaceably and quietly hold and enjoy
the Demised Premises for the term hereof, without hindrance from Landlord,
subject to the terms and conditions of this Lease
5. Landlord to be limited to the last twelve months of the Lease to show
prospective tenants through the Demised Premises.
6. Tenant to have one hundred and eighty (180) days to inspect the Demised
Premises for any Intent defects. Landlord at Landlord's expense shall
correct the defects and perform the repairs and/or replacements.
7. Landlord at Landlord's expense shall be responsible for all air
conditioning equipment, including but not limited to compressors, blowers,
and fans, inside the Demised Premises and on the roof for one hundred and
eighty (180) days after occupancy of the Demised Premises.
8. Article 12: Landlord's Contractual Lien to be stricken in its entirety.
9. Tenant to have the right to assign or sublease to subsidiary or affiliate
company without Landlord approval. Landlord shall not unreasonably withhold
prior written consent on any other assignment or sublease.
10. Upon request of Landlord, Tenant to provide only annually prepared audited
financial statements, with the frequency of only the beginning of the Lease
term and every twelve months thereafter.
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ 9/12/98
Landlord Date
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇ 9/11/98
Tenant Date