LEASE (this “Lease”) made as of the 19th day of August, 2005 (the “Date of this Lease” or “Date of the Lease”) by and between Dirk D. Laukien (“Landlord”), and PharmaFrontiers Corporation, a Texas corporation (“Tenant”). In consideration of the mutual...
Exhibit
10.13
LEASE
(this “Lease”) made as of the 19th
day of
August, 2005 (the “Date of this Lease” or “Date of the Lease”) by and between
▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (“Landlord”), and PharmaFrontiers
Corporation,
a Texas
corporation (“Tenant”). In consideration of the mutual covenants and conditions
set forth below, Landlord and Tenant hereby agree as follows.
ARTICLE
I
Basic
Data, Definitions, Exhibits
1.1 Basic
Data.
Each
reference in this Lease to any of the following subjects shall be construed
to
incorporate the data stated for that subject in this
Section 1.1.
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Landlord’s
Address:
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▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
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▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
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with
a copy in like manner to:
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▇▇▇▇▇
Peabody LLP
▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Attention:
▇▇▇▇▇ ▇. ▇▇▇▇▇, Esquire
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Tenant’s
Address:
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▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
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Land:
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The
land located at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, which is further described in Exhibit A attached hereto. |
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Building:
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The
building(s) presently located on the Land,
as shown on Exhibit B attached hereto. |
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Premises:
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The
Land, the Building and the driveways,
parking areas, loading facilities, walkways, utility lines and other improvements located on the Land. |
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Term
Commencement Date:
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October
1, 2005.
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Expiration
Date: th
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The
day prior to the tenth (10th)
anniversary of the Term Commencement Date.
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Term:
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The
period beginning on the Term
Commencement Date and ending on the Expiration Date. |
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Option
to Extend:
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The
Term may be extended for 2 period(s) of Five (5) years each
provided that Tenant gives prior written to Landlord on or before the date that is 9 months prior to the end of the then Term. |
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Base
Rent:
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Permitted
Uses:
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[Tenant
to provide, subject to Landlord review]
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Commercial
General Liability Insurance Limits:
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$5,000,000.00
combined single limit.
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1.2 Further
Definitions.
In
addition to terms set forth above, the following terms shall be defined as
indicated.
1.2.1 Additional
Parking.
“Additional Parking” shall mean the approximately 20 additional parking spaces
Landlord shall build on the Property no later than December 2, 2006, as more
fully described in exhibit D attached hereto.
1.2.2 Additional
Rent.
“Additional Rent” shall mean all Real Estate Taxes, personal property taxes,
insurance premiums and utility charges to be paid by Tenant pursuant to
Section 3.2, all interest to be paid by Tenant on late payments of rent and
late charges pursuant to Section 3.3, and all other charges to be paid by
Tenant and designated as Additional Rent by any other of the terms and
conditions of this Lease.
1.2.3 Alterations
and Improvements.
“Alterations and Improvements” shall mean any alterations, modifications,
installations, additions and improvements to the Premises but shall not include
the Additional Parking.
1.2.4 Applicable
Laws.
“Applicable Laws” shall mean all laws, codes, statutes, ordinances, by-laws,
regulations, rules, licenses, permits, variances, governmental orders,
governmental approvals, title restrictions and requirements of any board
of fire
underwriters, insurance rating organization and other insurance requirements
applicable to any given facts, things, circumstances or events.
1.2.5 Event
of Default.
“Event
of Default” shall refer to a default by Tenant under this Lease as enumerated
and described in Section 11.1, and shall have the specific meaning set forth
in
Section 11.1.
-2-
1.2.6 Hazardous
Substances.
“Hazardous Substances” shall mean any substances, materials or wastes defined or
regulated as hazardous or toxic by the federal Comprehensive Environmental
Response, Comprehensive and Liability Act, 42 U.S.C. §9601 et.
seq.,
the
federal Resource, Conservation and ▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇ ▇.▇.▇. §▇▇▇▇ et. seq.,
the
federal Hazardous Materials ▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇ ▇.▇.▇. §▇▇▇▇ et. seq.,
the
federal Toxic Substances Act, 15 U.S.C. §2601 et. seq.,
the
regulations adopted and publications promulgated pursuant to said Acts, and
any
other Applicable Laws, and shall specifically include, without limitation,
oil,
petroleum products, asbestos, urea formaldehyde insulation, materials containing
lead, radon, and flammable, combustible and explosive substances.
1.2.7 Indemnified
Parties.
“Indemnified Parties” shall have the meaning set forth in
Section 7.1.
1.2.8 Late
Payment/Default Interest Rate.
"Late
Payment/Default Interest Rate" shall mean the prime rate of interest published
from time to time in the Wall
Street Journal
(or if
such newspaper ceases publication or ceases publishing such rate, as published
from time to time in a reasonably comparable publication), plus 1% per annum,
but in no event more, when taken together with any other charges due from
Tenant
in connection therewith, than the maximum rate of interest allowed by Applicable
Laws.
1.2.9 Lease
Year.
“Lease
Year” shall mean each twelve month period during the Term commencing on the Term
Commencement Date and on each anniversary of the Term Commencement
Date.
1.2.10 Mortgage.
“Mortgage” shall mean any mortgage, deed of trust or other similar instrument
evidencing a voluntary lien or encumbrance on the Premises and all
modifications, amendments, extensions, renewals, replacements, substitutes
and
consolidations thereto.
1.2.11 Mortgagee.
“Mortgagee” shall mean the holder of any Mortgage.
1.2.12 Necessary
Permits.
“Necessary Permits” shall mean all licenses, permits, approvals and variances
necessary under all Applicable Laws to conduct a subject activity.
1.2.13 Parties
for Which Landlord Is Responsible.
"Parties
for Which Landlord Is Responsible" shall mean Landlord's employees, servants,
agents, contractors and invitees and any other parties claiming or occupying
by,
through or under Landlord or for which Landlord is otherwise legally
responsible.
1.2.14 Parties
for Which Tenant Is Responsible.
"Parties
for Which Tenant Is Responsible" shall mean Tenant's employees, servants,
agents, contractors, assignees, subtenants, licensees, concessionaires, invitees
and any other parties claiming or occupying by, through or under Tenant or
for
which Tenant is otherwise legally responsible.
1.2.15 Party;
Parties.
"Party"
shall mean either Landlord or Tenant generally. "Parties" shall mean both
Landlord and Tenant together.
-3-
1.2.16 Permitted
Assignments and Subleasings to Tenant Affiliates or Tenant
Successors.
“Permitted Assignments and Subleasings to Tenant Affiliates or Tenant
Successors” shall have the meaning set forth in Section 6.2.
1.2.17 Permitted
Hazardous Substances.
“Permitted Hazardous Substances” shall mean the Hazardous Substances ordinarily
necessary in the conduct of Tenant’s business on the Premises pursuant to the
Permitted Uses, as set forth on Exhibit E attached hereto. Tenant may bring
and
use Permitted Hazardous Substances on the Premises, but only subject to and
in
strict compliance with the requirements, restrictions and conditions set
forth
in Section 4.7.
1.2.18 Premises
Conditions.
"Premises Conditions" shall mean (a) title to the Premises, (b) the physical
condition of the Premises, (c) what access, easements and utilities are
available to the Premises, (d) the Applicable Laws with respect to the Premises,
and whether or not the Premises comply therewith, (e) the presence or absence
of
any Hazardous Substances or other pollutants in, on, or about the Premises,
(f)
any other environmental conditions, issues or problems with respect to the
Premises, (g) the suitability of the Premises for the Permitted Uses, (h)
the
feasibility of any subject Alterations and Improvements with respect to the
Premises, (i) the likelihood of obtaining any Necessary Permits, and (j)
any
other relevant conditions, facts, things or circumstances with respect to
the
Premises.
1.2.19 Rent.
“Rent”
shall mean Base Rent, Additional Rent and any other sums or charges required
to
be paid by Tenant to Landlord under this Lease.
1.2.20 Real
Estate Taxes.
“Real
Estate Taxes” shall mean (a) all taxes, assessments (special or otherwise),
levies, fees, water and sewer rents and charges, and all other government
levies
and charges, general and special, ordinary and extraordinary, foreseen and
unforeseen, which area, at any time prior to or during the Term hereof, imposed
or levied upon or assessed against the Premises, the Base Rent, Additional
Rent,
any other charges payable by Tenant hereunder, this Lease or the leasehold
estate created hereby, or which arise with respect to the operation, possession
or use of the Premises, (b) all gross receipts and similar taxes imposed or
levied upon, assessed against or measured by any Base Rent, Additional Rent
or
other charges payable by Tenant hereunder, (c) all sales, value added, use
and similar taxes at any time levied, assessed or payable on account of the
acquisition, leasing or use of the Premises, and (d) all charges for
utilities furnished to the Premises which may become a lien on the
Premises.
1.2.21 Real
Estate Tax Fund Payments.
“Real
Estate Tax Fund Payments” and “Tax Fund Payments” shall mean payments which
Landlord may require Tenant to make to Landlord pursuant to Section 3.2.2
in order to provide a fund adequate to pay all Real Estate Taxes with respect
to
the Premises when they become due and payable.
1.2.22 Tenant
Affiliate.
“Tenant
Affiliate” shall mean any corporation, person or group of persons, partnership,
trust or other entity (a) at least 51% of the outstanding stock, membership
interest, partnership interest or beneficial interest of which is owned by
Tenant, (b) which owns at least 51% of the outstanding stock, membership
interest, partnership interest or beneficial interest of Tenant, (c) at
least 51% of the outstanding stock, membership interest, partnership interest
or
beneficial interest of which is owned by a third corporation, corporation,
partnership, trust or other entity which also owns at least 51% of the
outstanding stock, membership interest, partnership interest or beneficial
interest of Tenant or (d) at least 51% of the outstanding stock, membership
interest, partnership interest or beneficial interest of which is owned
collectively by stockholders, members, partners or beneficiaries who also
own
collectively at least 51% of the outstanding stock, membership interest,
partnership interest or beneficial interest of Tenant.
-4-
1.2.23 Tenant
Successor.
“Tenant
Successor” shall mean any corporation, person or group of persons, partnership,
trust or other entity which is the successor to Tenant by merger, consolidation,
non-bankruptcy reorganization or acquisition of substantially all the assets
or
stock of Tenant.
1.2.24 Tenant’s
Broker.
“Tenant’s Broker” shall mean Colliers International.
1.3 Exhibits.
The
Exhibits listed below in this Section 1.3 are incorporated in this Lease
by
reference and are to be construed as a part hereof:
EXHIBIT
A Legal
Description of the Land
EXHIBIT
B Plan
of
Land
EXHIBIT
C Rent
Schedule
EXHIBIT
D Landlord
Work
EXHIBIT
E Permitted
Hazardous Waste
ARTICLE
II
Premises
and Term
2.1 Premises.
Landlord
hereby leases and demises the Premises to Tenant, and Tenant hereby leases
the
Premises from Landlord, subject to and with the benefit of the terms, covenants,
conditions and provisions of this Lease.
2.2 Term.
TO HAVE
AND TO HOLD for the Term, beginning on the Term Commencement Date and ending
on
the Expiration Date. Tenant is hereby granted two options to extend the Term
of
this Lease for two (2) consecutive periods of five (5) years each, upon the
same
terms, covenants and conditions applicable during the initial term, except
the
Base Rent shall be adjusted as set forth in Section 3.2. Provided that an
“event
of default” (as defined herein) is not then continuing, Tenant shall be
permitted to exercise its options to extend this Lease by giving written
notice
to Landlord no less than nine (9) months prior to the end of the initial
term or
first renewal term, as the case may be
2.3 Premises
Leased “As Is”.
Landlord
has no knowledge of any material default or defect in the Premises Conditions
and makes no representations or warranties whatsoever with respect to the
Premises or any Premises Conditions. Landlord leases the Premises to Tenant
“as
is, where is and with all faults”. Tenant acknowledges that it has had full,
adequate and complete opportunity to inspect, investigate, examine and test
all
Premises Conditions and that it is fully and completely satisfied therewith.
Landlord shall not have any obligation whatsoever to repair or remediate
any
Premises Conditions, nor shall Landlord have any liability to Tenant with
respect thereto except repairs required by section 4.3 hereof. Landlord further
shall not be obligated to make any repairs, to construct any Alterations
and
Improvements or to perform any other work to prepare the Premises for Tenant’s
occupancy, with the exception of the Additional Parking. Notwithstanding
anything to the contrary herein contained, Landlord is responsible for and
shall
keep in good order and condition the roof, slab, foundations, structural
elements, exterior walls, roofs and chimneys and herein warrants that all
such
items are in good condition fit for the purposes of this Lease.
-5-
2.4 Delivery.
Landlord
shall deliver the Premises to Tenant on the Term Commencement Date free and
clear of all other tenants and occupants, in substantially the same condition
as
they are in on the Date of this Lease, except for reasonable wear and tear
and
any modifications made or damage caused by Tenant.
ARTICLE
III
Base
Rent and Additional Rent
3.1 Base
Rent.
Tenant
covenants and agrees to pay the Base Rent to Landlord throughout the Term
without offset, deduction or counterclaim, unless provided for in section
4.2.1,
at Landlord’s Address or at such other place or to such other person or entity
as Landlord may direct by notice to Tenant from time to time, in the annual
amount for each Lease Year specified below in monthly installments equal
to 1/12
of such annual amount, by the tenth day of each calendar month during the
Term,
and for any partial month at the beginning or the end of the Term, the pro-rata
portion of such monthly amount allocable thereto.
3.1.1 First
Lease Year.
During
the first Lease Year, the Base Rent shall be $59,535.50 per Lease
Year.
3.1.2 Second
Through Tenth Lease Years.
During
each of the second through third Lease Years, inclusive, the annual Base
Rent
shall be the amount set forth in the Rent Schedule set forth in Exhibit
C,
attached hereto.
3.1.3 Option
Period Rent.During
the
Option Period(s), the annual Base Rent shall be “Fair Market Rental Value”
(“FMRV”). FMRV shall be reasonably determined by Landlord and Tenant to be the
annual rental charge as of the termination date of the Term for new leases
then
being negotiated or executed for comparable space in The Woodlands, Texas
for
terms commencing on or about the date of termination and ending as of the
expiration of what would have been the Term (including Extended Terms). In
determining FMRV, the following shall be taken into consideration: the size,
location and condition of the applicable comparable premises, lease term,
services provided by the landlord, rental concessions and other factors.
Landlord and Tenant shall in good faith attempt to agree in writing on FMRV
within 30 days after Landlord’s receipt of Tenant’s notice of extension. If
Landlord and Tenant cannot so agree, FMRV shall be determined by impartial
appraisers, one each to be chosen by Landlord and Tenant, and, if necessary,
a
third to be selected as provided below. All appraisers shall be MAI certified,
familiar with commercial leasing and leases and rents in the area surrounding
the Building, and shall have at least 5 years experience in making real estate
appraisals. Landlord and Tenant shall notify each other of its selected
appraiser within 5 days following the expiration of such 10 day period. The
initial appraisers shall render their written appraisals of FMRV within 30
days
after their appointment. If such appraisals are less than 5% apart, then
FMRV
shall be deemed to be the average of the 2 appraisals. Otherwise, the initial
appraisers shall promptly select a third appraiser who shall submit its
appraisal to Landlord and Tenant within 21 days after its appointment. The
appraisal falling between the other two appraisals (that is, the arithmetic
median of the 3 appraisals) shall be binding upon Landlord and Tenant. The
cost
of each of the initial appraisers shall be paid by the party selecting such
appraiser and the cost of the third appraiser shall be shared equally between
Landlord and Tenant.
-6-
3.2 Additional
Rent.
This
Lease is a NET LEASE, and Landlord shall not be obligated to pay any charge
or
bear any expense whatsoever against or with respect to the Premises, nor
shall
the rent payable hereunder be subject to any offset, deduction or counterclaim
whatsoever on account of any such charge or otherwise, except only as
specifically provided in this Lease to the contrary. In order that the Base
Rent
shall be absolutely net to Landlord, Tenant covenants and agrees to pay as
Additional Rent, without offset, reduction or counterclaim, except as set
forth
in section 4.2.1, Real Estate Taxes, insurance costs and utility charges
with
respect to the Premises as follows:
3.2.1 Real
Estate Taxes.
Tenant
shall pay all Real Estate Taxes assessed, levied or imposed on or with respect
to the Premises during or with respect to the Term. For each tax or assessment
period, or installment period thereof, wholly included in the Term, Tenant
shall
pay such Real Estate Taxes directly to the authority or authorities charged
with
the collection thereto not less than ten days prior to the last date on which
the same may be paid without interest or penalty. For any fraction of a tax
or
assessment period, or installment period thereof, included in the Term at
the
beginning or end thereof, Tenant shall pay to Landlord, within ten days after
receipt of an invoice therefor, the fraction of the Real Estate Taxes so
levied
or assessed or becoming payable which is allocable to such included period.
Tenant shall promptly after payment thereof furnish Landlord proof of payment
of
all items which Tenant is required to pay pursuant to this
Section 3.2.1.
Tenant
may, at its election, but shall not be obligated to, initiate and prosecute
an
action or proceeding for abatement or reduction of any Real Estate Taxes.
Landlord shall reasonably cooperate with Tenant in seeking such abatement
or
reduction. Any abatement received shall be paid and distributed first to
Landlord in the amount of the reasonable costs and expenses expended by Landlord
to obtain such abatement, and the remainder to each Party in the proportion
that
it paid the Real Estate Taxes which were abated.
Nothing
contained in this Lease shall require Tenant to pay any income franchise,
corporate, estate, inheritance, succession, capital levy or transfer tax
of
Landlord, unless such tax is imposed, levied or assessed in substitution
for any Real Estate Taxes which Tenant is otherwise required to pay pursuant
to
this Section 3.2.1.
-7-
3.2.2 Tax
Fund Payments.
If
either (a) any Mortgagee shall ever require Real Estate Tax escrow payments
by
Landlord or (b) Landlord shall in its sole discretion at any time and from
time
to time elect, rather than have Tenant pay Real Estate Taxes directly to
the
applicable authorities, to do so itself and have Tenant make Tenant's payments
for Real Estate Taxes to Landlord instead, then, upon notice from Landlord
requiring the same, Tenant shall thereafter make monthly payments to Landlord
equal to 1/12 of the prior fiscal year’s total Real Estate Tax (“Real Estate Tax
Fund Payments” or “Tax Fund Payments”). If the aggregate of such Tax Fund
Payments is not adequate to pay all such Real Estate Taxes, then Tenant shall
pay to Landlord the amount by which such aggregate is less than the amount
of
all such Real Estate Taxes, such payment to be made on or before the later
of
(a) ten days after receipt by Tenant of notice from Landlord of such
amount, or (b) the 30th day prior to the last day on which such Real
Estate Taxes may be paid without interest or penalty. If Tenant shall have
made
the aforesaid Tax Fund Payments, then Landlord shall pay such Real Estate
Taxes
to the proper authority charged with the collection thereof, up to the amount
of
such Tax Fund Payments, and furnish Tenant, evidence of such payment. Any
balance remaining on December 31 of any given year shall be refunded to Tenant
by January 10 of the following year. In the event of any default under the
terms
of this Lease, any part or all of said reserve fund may, at the election
of
Landlord, be applied to any of Tenant’s obligations under this Lease. Tenant
shall continue to make Tax Fund Payments to Landlord until Landlord at its
election terminates the requirement for such payments. If at any time Landlord
so terminates the requirement for Tax Fund Payments, then Tenant shall resume
paying Real Estate Taxes directly to the applicable authorities as required
by
Section 3.2.1 and shall continue to do so unless and until Landlord again
later
directs Tenant to make Tax Fund Payments to Landlord pursuant to this Section
3.2.2.
3.2.3 Personal
Property Taxes.
Tenant
shall pay all taxes assessed against Tenant’s personal property on or about the
Premises directly to the authorities charged with the collection thereof,
before
or on the dates due from time to time.
3.2.4 Landlord’s
Insurance Costs.
Tenant
shall be responsible for all premiums and shall be responsible for procuring
and
maintaining for Landlord’s benefit all-risk fire and casualty insurance,
liability insurance, rental value insurance or any Mortgagee may require
Landlord to carry with respect to the Premises during the Term. Tenant shall
pay
such costs directly or, if Tenant fails to comply with the obligation hereunder,
Tenant shall pay such costs directly to Landlord within 30 days after billing
by
Landlord from time to time. In the alternative, if either (a) any Mortgagee
shall ever require insurance escrow payments by Landlord or (b) Landlord in
its sole discretion at any time and from time to time shall so elect, then,
upon
notice from Landlord requiring the same, Tenant shall thereafter make monthly
payments to Landlord in such amounts equal to 1/12 of the insurance premiums
and
costs due for that year (“Insurance Fund Payments”) on the same terms and
conditions and in accordance with the same procedures as provided in Section
3.2.2 for Real Estate Tax Fund Payments. Notwithstanding the foregoing, Landlord
shall be responsible for all costs associated with the Additional
Parking.
3.2.5 Tenant’s
Insurance Costs.
Tenant
shall further pay all premiums and other costs of the insurance which it
is
required to carry pursuant to Article VII directly to the applicable
insurers before or on the dates due from time to time.
-8-
3.2.6 Utilities.
Tenant
shall pay directly to the proper authorities charged with the collection
thereof
all charges for water, sewer, gas, electricity, telephone and other utilities
or
services used or consumed on the Premises, whether called charge, tax,
assessment, fee or otherwise, including, without limitation, water and sewer
use
charges and taxes, if any. Tenant shall pay such charges before or on the
dates
due from time to time.
3.3 Late
Payment of Rent.
If
Tenant fails to make any payment of Rent by the date due, then Tenant shall
pay
Landlord interest on such payment from the date due until the date paid at
the
Late Payment/Default Interest Rate. In addition, Tenant shall pay Landlord
a
late charge for any Rent payment which is not paid within ten days after
its due
date equal to five percent of such payment.
3.4 Cost
of
Tenant’s Obligations.
Tenant
shall bear the entire cost and expense of fulfilling and performing all of
its
obligations under this Lease, including, without limitation, its obligations
to
perform and make all necessary maintenance, repairs, replacements and
Alterations and Improvements to the Premises, without any contributions
whatsoever from Landlord except as set forth herein.
3.5 Costs
of Landlord’s Obligations.
Landlord
shall bear the entire cost and expense of fulfilling and performing all of
its
obligations under this Lease, including, without limitation, its obligations
to
perform and make all necessary maintenance, repairs, replacements to the
roof,
slab, foundations, structural elements, exterior walls, roofs, and chimneys
and
the Additional Parking to the Premises, without any contributions whatsoever
from Tenant.
ARTICLE
IV
Use
4.1 Use.
Tenant
shall use the Premises only for the Permitted Uses and not for any other
purpose.
4.2 Repair
and Maintenance.
Tenant
shall throughout the Term keep and maintain the entire Premises, including,
without limitation, all doors, windows, interior walls, lobbies, hallways,
stairways, rooms, basements, lawns, grounds, landscaped areas, parking areas,
loading areas, driveways, sidewalks, walkways, landings and entryways thereof,
all heating, ventilating, air conditioning, hot water, plumbing, electrical,
gas, elevator, mechanical, security and alarm fixtures, equipment, lines
and
systems therein and Tenant’s trade fixtures and equipment therein in good,
clean, sanitary, safe, sound, working and tenantable condition and repair
and in
at least as good order, condition and repair as they are in on the Term
Commencement Date or may be put during the Term, excepting only
(a) reasonable wear and tear and (b) damage by fire or other casualty or
taking by condemnation or eminent domain which shall instead be governed
by
Articles VIII and IX. Tenant shall promptly make all repairs and
replacements and do all other work necessary to accomplish the foregoing.
If
requested by Landlord, Tenant shall secure, pay for and keep in force contracts
with appropriate and reputable service companies providing for regular and
proper maintenance of all heating, ventilating, air conditioning, elevator,
alarm and security systems in the Premises, if requested, furnish copies
of all
such contracts to Landlord. Tenant shall remove snow and ice from all parking
areas, loading areas, driveways, walkways, sidewalks, entryways, porches,
landings and fire escapes on or surrounding the Premises promptly after
accumulation. Tenant shall also make regular use of and lock any gates on
the
Premises after normal business hours to prevent unauthorized access the Premises
by third-parties. Notwithstanding anything to the contrary herein contained,
Landlord shall be responsible for repairs and replacement of the slab,
foundations, structural elements, exterior walls, roofs, and chimneys, unless
the need for such repair or replacement is the result of Tenant’s negligence or
willful act.
-9-
4.2.1 Landlord’s
Repair and Maintenance.
Tenant
shall provide written notice to Landlord for any repair that is or may be
needed
on the slab, foundation, structural elements, exterior wall, roofs, and
chimneys. Landlord shall have ten (10) days to respond to such notice, unless
the needed repair will interrupt the Permitted Use of the Premises, in which
case, Landlord has seventy-two (72) hours to respond to such notice. If Landlord
fails to perform it obligations to repair and maintain the slab, foundation,
structural elements, exterior wall, roofs and chimneys, then Tenant may,
at it
sole discretion, repair the damage and deduct such cost from the Additional
Rent
owed to Landlord.
4.3 Compliance
with Law.
Tenant
shall comply, at Tenant’s cost and expense, with all recorded restrictive
covenants encumbering the Land and all present and future laws, ordinances,
orders, rules, regulations and requirements of all federal, state, and municipal
governments, including all municipal and road utility districts and municipal
utility districts, and all departments, commissions, boards and officers
thereof, and any other body exercising similar functions, which now or hereafter
may be applicable to the Premises, the improvements in the Premises, or to
the
use or manner of use of the Premises or the improvements, including but not
limited to , all environmental laws and the Americans With Disabilities Act.
Without limiting the generality of the foregoing, Tenant shall (a) obtain
all Necessary Permits for the Permitted Uses and Tenant’s occupancy of the
Premises before commencing such uses and occupancy and maintain such permits
in
force and effect while continuing such use and occupancy, (b) obtain all
Necessary Permits for any Alterations and Improvements which Tenant may make
to
the Premises from time to time pursuant to Article V before commencing any
such work, (c) install and maintain all safety equipment required in and on
the Premises from time to time by all Applicable Laws and (d) make all
repairs, replacements, installations, Alterations and Improvements required
to
the Premises from time to time by all Applicable Laws. Notwithstanding the
foregoing, if Tenant should contest the applicability or validity of any
purportedly Applicable Law in good faith and by appropriate legal proceedings,
then Tenant may postpone compliance pending the outcome of such contest to
the
extent (but only to the extent) that such postponement shall not jeopardize
the
health and safety of any persons or property on, in or about the Premises
or
expose Landlord to any penalties, sanctions or liabilities.
4.4 No
Nuisance; Prohibited Uses.
Tenant
shall not injure, overload, deface or otherwise harm the Premises; nor overload,
impair or interfere with the heating, ventilating, air conditioning, hot
water,
plumbing, electrical, gas, elevator, mechanical, security, alarm or other
systems in the Premises; nor commit any nuisance on, in, from or about the
Premises; nor emit or permit the emission of any objectionable noise, vibration,
odor, smoke or vapor from the Premises; nor in any way disturb, annoy,
inconvenience, or cause discomfort to, other abutting properties or the
surrounding neighborhood; nor conduct or allow any illegal, illicit or immoral
activities on the Premises; nor make, allow or suffer any waste of the Premises;
nor make any use of the Premises which is improper, offensive or contrary
to
Applicable Laws or which will invalidate any of Landlord’s or Tenant’s
insurance; nor conduct any auction, fire, “going out of business” or bankruptcy
sales on the Premises; nor in any way impair or damage the appearance, image
or
reputation of the Premises.
4.5 Rubbish
Removal, Etc.
Tenant
shall have all trash, refuse, and garbage removed from the Premises at frequent
intervals by a qualified removal contractor. Tenant shall keep all trash,
refuse
and garbage in suitable covered and secured containers and deodorized until
removed. In no event shall Tenant allow large amounts of trash, refuse and
garbage to accumulate. Tenant shall take reasonable precautions to prevent
insect, vermin and pest infestation of the Premises, and shall promptly have
insects, vermin and pests exterminated by a qualified extermination contractor
should any infestation occur. Tenant shall at all times maintain the Premises
in
a clean, safe and sanitary condition.
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4.6 Safety
and Security.
Tenant
shall at all times maintain safety and provide adequate security in the Premises
and with respect to the conduct of its business therein by, without limitation,
(a) installing, utilizing, operating and maintaining appropriate locks and
safety, security, fire suppression and alarm systems and equipment,
(b) establishing appropriate and adequate safety and security
procedures, training its employees in such procedures and causing such employees
to follow them, and (c) if necessary, employing adequately trained security
guards, personnel or services.
4.7 Hazardous
Materials.
Tenant
shall not bring, generate, store, use, install, dispose of, spill, release,
emit
or discharge any Hazardous Substances on, in or from the Premises, nor suffer,
permit or allow any other Party for which Tenant Is Responsible to do so,
except
only for Permitted Hazardous Substances which are reasonably necessary for
the
conduct of Tenant’s business in accordance with the Permitted Uses. Tenant shall
bring, generate, store, use and dispose of any such Permitted Hazardous
Substances in strict compliance with all Applicable Laws, manufacturers’
directions and industry standards, and shall defend, indemnify and hold Landlord
harmless with respect thereto as more particularly set forth in Section 7.1.
Tenant shall give Landlord notice of the specific Permitted Hazardous Substance
which Tenant uses on the Premises from time to time, the procedures which
Tenant
follows in the use, storage and disposal thereof and all other relevant facts
with respect thereto. In the event that Tenant or any Parties for Which Tenant
Is Responsible should spill, release, emit, discharge or dispose of any
Hazardous Substances, permitted or otherwise, on, in or from the Premises.
Tenant shall (a) immediately notify Landlord thereof, (b) promptly contain,
remediate, remove and clean up such substances in strict compliance with
all
Applicable Laws and (c) defend, indemnify and hold Landlord harmless with
respect thereto pursuant to Section 7.1 as aforesaid. Tenant shall further
maintain environmental insurance covering its use of any Hazardous Substances
on
the Premises as provided in Section 7.3.7.
4.8 Utilities.
Tenant
shall make its own arrangements for water, sewer, gas, electricity, telephone
and all other utilities necessary to operate the Premises and to conduct
the
Permitted Uses therein. Landlord represents that appropriate connections
for
such utilities currently exist at the Premises.
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4.9 Signs.
Tenant
shall comply with all requirements set forth in Article V in erecting any
signs on the Premises, including, without limitation, obtaining Landlord’s prior
approval of the plans and specifications for any such signs.
4.10 Tenant
Responsible for all Services, Etc.
Except
only for repair and restoration of the Premises after a fire or other casualty
or taking of the Premises by condemnation or eminent domain pursuant to
Articles VIII and IX or as otherwise specifically provided to the contrary
in this Lease, Landlord shall not be obligated to maintain or repair the
Premises, to provide water, sewer, gas, electricity, telephone or any other
utilities to the Premises, to heat, air condition or ventilate the Premises,
to
remove trash, refuse and garbage from the Premises, to provide janitorial
or
security services to the Premises, to make the Premises comply with Applicable
Laws or to provide any services, perform any functions or do any work whatsoever
with respect to the Premises. Rather, all such services, functions and work
shall be Tenant’s responsibility, as provided in this Article IV and the
other provisions, terms and conditions hereof.
4.11 Landlord’s
Right to Enter.
Tenant
shall permit Landlord and its agents to enter the Premises during normal
business hours with twenty four (24) hours notice (a) to examine the Premises,
(b) to make construction inspections pursuant to Section 5.6, (c) to make
such inspections, tests, repairs and replacements as Landlord may elect,
without, however, any obligation to do so, (d) to repair and restore the
Premises after a fire or other casualty or taking of the Premises by
condemnation or eminent domain pursuant to Articles VIII and IX,
(e) to cure any defaults by Tenant pursuant to Section 11.4, again
without any obligation to do so, and (f) to show the Premises to prospective
purchasers and lenders. Tenant shall further permit Landlord and its agents
during the last year of the Term to show the Premises to prospective tenants
and, during the last six months of the Term, to affix and maintain notices
of
availability in suitable places in and on the Premises. Notwithstanding the
above, Landlord has the right to enter the Premises, at any time, without
notice, in the event of an emergency.
ARTICLE
V
Alterations
and Improvements
5.1 Construction
by Tenant.
Tenant
may, from time to time during the Term, at its own cost and expense, make
Alterations and Improvements to the Premises as necessary for the Permitted
Uses, in compliance with the terms and conditions of this Article V.
5.2 Pre-Construction
Obligations.
Before
commencing construction of any Alterations and Improvements, Tenant shall
comply
with the following:
5.2.1 Plans
and Specifications.
Tenant
shall have prepared and deliver to Landlord reasonably detailed plans and
specifications for such Alterations and Improvements prepared by registered
professional architects and engineers and obtain Landlord’s written approval
thereof. Such plans and specifications shall include a certification by such
architects and engineers that such Alterations and Improvements as shown
and
described thereby comply with all Applicable Laws. Landlord shall approve
or
disapprove such plans and specifications by written notice to Tenant within
10
days after Tenant’s submittal of such plans and specifications. Such approval
shall not be unreasonably withheld. If Landlord fails to give Tenant such
notice
within such 10 days, then Landlord shall be deemed to have approved such
plans
and specifications. If Landlord disapproves of such plans and specifications,
then Landlord shall in its disapproval notice specify in reasonable detail
the
respects in which such plans and specifications are not satisfactory. Tenant
shall then revise such plans and specifications to eliminate, upgrade or
correct, as appropriate, the unsatisfactory items, and resubmit the revised
plans and specifications to Landlord in accordance with the foregoing. Landlord
shall subsequently approve or disapprove any revised and resubmitted plans
and
specifications in the same manner as is required for new plans and
specifications.
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5.2.2 Contractor
and Major Subcontractors.
Tenant
shall give Landlord written notice as to what general contractor Tenant proposes
to hire to construct such Alterations and Improvements and of all subcontractors
who will perform work costing more than 40% of the total construction costs
for
such improvements and shall obtain Landlord’s written approval of such general
contractor and subcontractors. Such notice shall include reasonable background
information on such general contractor and each such subcontractor, including,
without limitation, references and lists of previous projects completed.
Landlord shall approve, within 10 days, such general contractor unless such
general contractor is not bondable, insurable or competent. Such approval
shall
not be unreasonably withheld. If Landlord fails to give Tenant such notice
within such 10 days, then Landlord shall be deemed to have approved such
general
contractor. If Landlord disapproves any such general contractor, then Landlord
shall in such notice set forth its reasons for disapproval in reasonable
detail.
5.2.3 Necessary
Permits.
Tenant
shall obtain all Necessary Permits for such Alterations and Improvements
under
all Applicable Laws.
5.2.4 Insurance.
Tenant
shall obtain, or cause its general contractor and subcontractors to obtain,
as
applicable, the insurance specified in Section 7.3.5 and provide Landlord
with original certificates thereof and copies of such policies. Tenant shall
maintain, or cause such contractors to maintain, said insurance throughout
the
course of construction.
5.2.5 Bonds.
If
reasonably required by Landlord for any particular Alterations and Improvements
because of the magnitude or scope thereof, Tenant shall obtain and deliver
to
Landlord a bond covering the construction costs for the Alterations and
Improvements. Landlord and Tenant shall be named as dual obligees under such
bonds. Tenant shall maintain such bonds in effect throughout the course of
construction and until construction is fully completed. Additionally, Tenant
agrees to remove or bond around, within thirty (30) days of notice of a lien
placed on the Premises by a contractor or sub-contractor hired by Tenant.
Failure by Tenant to remove or bond around such lien, within the specified
time
period, shall be deemed an Event of Default under Section 11.1.
5.3 Construction.
Tenant
shall construct the Alterations and Improvements in substantial compliance
with
the plans and specifications approved by Landlord, the Necessary Permits
received and all Applicable Laws. In carrying out such construction, Tenant
shall not materially modify or deviate from the plans and specifications
approved by Landlord without first obtaining Landlord’s approval of such
modification or deviation in the manner described in Section 5.2.1. All work
shall be done in a good and workmanlike manner using first class materials.
Once
having commenced, Tenant shall diligently and continuously construct the
Alterations and Improvements until completed.
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5.4 Safety.
Tenant
shall perform all work in a safe and proper manner and shall take all necessary
precautions to prevent (a) injury to any workers, employees, tenants,
occupants, visitors, passers-by and all other persons on, in, about and in
the
vicinity of the Premises and (b) damage to the Premises and all property
in, on, about, abutting and in the vicinity of the Premises. Without limiting
the generality of the foregoing, Tenant shall strictly comply with all
Applicable Laws with respect to construction safety.
5.5 Payment
of Costs; Discharge of Liens.
Tenant
shall pay promptly when due the entire cost of constructing the Alterations
and
Improvements so that the Premises shall at all times be free of any liens
for
labor and materials. If any such lien should be recorded or should otherwise
attach against the Premises, Tenant shall remove the same in accordance with
Section 5.2.5.
5.6 Inspections.
Landlord
shall have the right, but shall not be obligated, to inspect Tenant’s work from
time to time throughout the course of construction in order to determine
whether
or not such work complies with the requirements of this Article V. Tenant
shall promptly correct any non-conformities of which Landlord gives Tenant
notice.
5.7 Landlord’s
Representatives.
Landlord
may hire architects, engineers, consultants and other qualified professionals
to
assist it in making all reviews, inspections and decisions which Landlord
is
required or entitled to make under this Lease. Such persons shall have the
same
access to the Premises as Landlord has pursuant to Sections 5.6 and 4.11
and
shall be entitled to read and review the same documents and materials which
Landlord is entitled to receive and review hereunder. Landlord shall bear
the
cost for hiring any such architects, engineers, consultants and other qualified
professionals.
5.8 Landlord
Not Responsible for Tenant’s Work.
No
approval given by Landlord or failure by Landlord to raise any objection
pursuant this Article V or otherwise shall constitute a representation,
warranty or acknowledgment that the element approved or not objected to is
in
compliance with Applicable Laws, properly designed or constructed or fit
for its
intended purpose, or that the person approved or not objected to is qualified
for the given job or task. All judgments and determinations with respect
to such
matters shall remain the sole responsibility of Tenant. Landlord shall not
be a
party to any contract for construction of the Alterations and Improvements
or
other work by Tenant on the Premises, nor shall Landlord have any obligation
or
liability to any of Tenant’s contractors, subcontractors or any other party with
respect to such construction or work, whether under any such contract or
otherwise.
5.9 Ownership.
All
Alterations and Improvements constructed by Tenant shall be deemed part of
the
Premises and shall be the property of Landlord, subject to Tenant’s rights of
use and occupancy pursuant to this Lease, except only that Tenant’s trade
installations, trade fixtures and equipment (as distinguished from base building
type items) shall remain Tenant’s property.
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ARTICLE
VI
Assignment
and Subletting
6.1 Assignments
and Subleasings Generally.
Except
for Permitted Assignments and Subleasings to Tenant Affiliates or Tenant
Successors pursuant to Section 6.2, Tenant shall not assign, transfer, mortgage
or pledge this Lease or grant a security interest in Tenant's rights hereunder,
or sublease (which term shall be deemed to include the granting of concessions
and licenses and the like) all of any part of the Premises, or suffer or
permit
this Lease or the leasehold interest created hereby to be assigned, transferred
or encumbered, in whole or in part, whether voluntarily, involuntarily or
by
operation of law, without in each instance obtaining Landlord's written consent
thereto, which consent shall not be unreasonably withheld or delayed provided
that the following conditions are met: (a) Tenant shall not be in default
hereunder at the time of such assignment or subletting after notice and the
cure
period provided for herein, (b) the proposed assignee or subtenant is
(i) duly organized and validly existing under the laws of the United States
or any state thereof, (ii) qualified to do business in the State of Texas,
(iii) of good business reputation, (iv) creditworthy and (v) has
the reasonable financial capability, in the case of an assignee, to perform
Tenant’s obligations hereunder, and in the case of a subtenant, to perform
Tenant’s obligations under the subject sublease, (c) the assignment
instrument or subject sublease is reasonably satisfactory to Landlord in
form
and substance, and (d) either (i) the proposed assignee executes and
delivers an instrument to Landlord by which such assignee attorns to Landlord,
agrees to be bound by the terms, provisions and conditions of this Lease
and to
assume all of Tenant’s obligations hereunder, or (ii) the proposed
subtenant executes and delivers an instrument to Landlord accepting such
reasonable conditions to Landlord’s consent as Landlord shall dictate.
6.2 Permitted
Assignments and Subleasings to Tenant Affiliates and Tenant
Successors.
Tenant
may from time to time assign this Lease or sublease all or any part of the
Premises to a Tenant Affiliate or Tenant Successor without having to obtain
Landlord’s consent, provided that (a) Tenant shall give Landlord at least
30 days prior written notice of the subject transaction and (b) all of the
conditions specified in Section 6.1 are met with respect to the subject
transaction (such an assignment or subleasing, a “Permitted Assignment or
Subleasing to a Tenant Affiliate or Tenant Successor”).
6.3 Information.
Tenant
shall for each proposed assignment or subleasing provide Landlord with the
(a)
name and address of the proposed assignee or subtenant, (b) copies of all
assignment or sublease instruments, (c) a credit report from a recognized
service for the proposed assignee or subtenant, if available,
(d) reasonably detailed and appropriate financial statements for the
proposed assignee or subtenant for the last two years or so many of them
for
which such statements are available, and if not available, reasonable
alternative financial information which accurately presents the financial
condition of the proposed assignee or subtenant, and (e) any other
information and documentation which Landlord may reasonably request. Landlord
shall not be obligated to pass on the proposed assignment or subleasing until
it
has received and had reasonable time to review all such information and
documentation.
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6.4 Excess
Sublease Rentals.
Tenant
shall pay to Landlord 50% of any rentals or other consideration received
from
any assignee or subtenant in excess of the Rent allocable to the space assigned
or subleased.
6.5 Transfer
in Violation Void; Tenant’s Liability Continues.
Any
attempted assignment, transfer, mortgage, pledge, grant of security interest,
sublease or other encumbrance, except as permitted by this Article VI,
shall be void. Any assignment, transfer, mortgage, pledge, grant of security
interest, sublease or other encumbrance which is so permitted shall be subject
to, and the assignee, transferee, mortgagee, pledgee, grantee or sublessee
thereunder shall be bound by, all of the terms, conditions and provisions
of
this Lease. No assignment, transfer, mortgage, grant of security interest,
sublease or other encumbrance, whether or not approved, and no indulgence
granted by Landlord to any assignee, sublease or occupant shall in any way
impair Tenant’s continuing primary liability hereunder, which after an
assignment or subletting shall be joint and several with the assignee or
sublessee. No consent by Landlord to any particular assignment, transfer,
mortgage, pledge, grant of a security interest, sublease or encumbrance shall
be
construed as a consent to any other assignment, transfer, mortgage, pledge,
grant of a security interest, sublease or encumbrance, nor as a waiver of
Tenant’s obligation to obtain Landlord’s consent to any other such transaction
in any other instance or case.
ARTICLE
VII
Indemnity
and Insurance
7.1 Indemnity.
Tenant
shall defend, with counsel reasonably approved by Landlord (which approval
shall
not be unreasonably withheld or delayed), all actions against Landlord, any
manager, member, partner, trustee, stockholder, officer, director, employee
or
beneficiary of Landlord, Mortgagees and any other party having an interest
in
the Premises (herein, “Indemnified Parties”) with respect to, and shall pay,
protect, indemnify and save harmless, to the extent permitted by Applicable
Laws, all Indemnified Parties from and against, any and all liabilities,
losses,
damages, costs, expenses (including reasonable attorneys’ fees and expenses),
causes of action, suits, claims, demands or judgments of any nature arising
from
(a) any injury to or death of any person, or damage to or loss of property,
in, on or about the Premises or on adjoining sidewalks, streets or ways,
or
connected with the use, condition or occupancy of any thereof, (b) any
breach or violation by Tenant of any of the terms, conditions or provisions
of
this Lease, (c) any act, omission, fault, misconduct, negligence or
violation of Applicable Laws by Tenant or any Parties for Which Tenant Is
Responsible, (d) any Hazardous Substances brought, generated, stored, used,
installed, disposed of, spilled, released, emitted or discharged on, in or
from
the Premises, or allowed, permitted or suffered to be brought, generated,
stored, used, installed, disposed of, spilled, released, emitted or discharged
thereon, therein or therefrom, by Tenant or any Parties for Which Tenant
Is
Responsible, whether Permitted Incidental Hazardous Substances or otherwise,
(e) any construction or other work by Tenant on or about the Premises,
including, without limitation, construction of any Alterations and Improvements
to the Premises pursuant to Article V, and (f) any contest initiated by
Tenant referred to in Section 4.3; provided, however, that Tenant does not
hereby indemnify Landlord from any liabilities, losses, damages, costs,
expenses, causes of action, suits, claims, demands or judgments to the extent
caused by the negligence or willful misconduct of Landlord or any Parties
for
Which Landlord Is Responsible. Notwithstanding the foregoing, Tenant does
not
indemnify Landlord for any liabilities, losses, damages, costs, expenses,
causes
of action, suits, claims, demands or judgment of an any nature arising from
any
repairs or maintenance work provided by Landlord or related to the construction
of the Additional Parking.
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7.2 Use
and
Occupancy at Tenant’s Risk.
Tenant’s
use and occupancy of the Premises, and that of any Party for Which Tenant
Is
Responsible, and all Tenant’s furnishings, fixtures, equipment, Alterations and
Improvements, materials, supplies, inventory, effects and property of every
kind, nature and description and those of any Party for Which Tenant Is
Responsible which during the continuance of this Lease or any occupancy of
the
Premises by Tenant or any Party for Which Tenant Is Responsible may be on
the
Premises shall be at Tenant’s and such parties’ sole risk and hazard. Landlord
shall not be liable to Tenant or any Party for Which Tenant Is Responsible
for
injury to or death of any person or damage to or destruction of any property
in,
on or about the Premises, or for any other losses, damages, costs, expenses
or
liabilities whatsoever, including, without limitation, where caused by fire,
water, explosion, collapse, the leakage or bursting of water, steam, or other
pipes, any environmental or other condition in, on, of or about the Premises
or
any other event, occurrence, condition or cause, except only to the extent
caused by the negligence, willful misconduct, acts or omissions of Landlord
or
any Parties for Which Landlord is Responsible. Tenant and any Party for Which
Tenant is Responsible shall be responsible to take out and maintain adequate
insurance to protect themselves against the aforesaid losses, damages, costs,
expenses and liabilities showing Landlord as insured as its interest may
appear.
7.3 Insurance
to be Carried.
Tenant
shall take out and maintain throughout the Term and such further time as
Tenant
occupies all or any part of the Premises, the following insurance with respect
to the Premises at Tenant’s sole cost and expense:
7.3.1 Property
Insurance.
Special
form property insurance covering all Alterations and Improvements constructed
by
Tenant and Tenant’s fixtures, furnishings, equipment, materials, supplies,
inventory, effects and personal property in the Premises, in the amount of
the
replacement cost thereof from time to time, with business income and extra
expense coverage by endorsement thereto.
7.3.2 Liability
Insurance.
Commercial general liability insurance indemnifying against all claims and
demands for any injury to person or property which may be claimed to have
occurred in, on or about the Premises in amounts which shall, at the beginning
of the Term, be at least equal to the limits set forth for such insurance
in
Section 1.1, and, from time to time during the Term, shall be for such
higher limits, if any, as are customarily carried in the area in which the
Premises are located on property similar to the Premises and used for similar
purposes, provided that Tenant shall not be obligated to so increase such
insurance unless at least one year has elapsed since the last adjustment
and
then only if requested to do so by Landlord.
7.3.3 Workmen’s
Compensation Insurance.
Workmen’s compensation insurance with statutory limits covering all of Tenant’s
employees working on the Premises.
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7.3.4 Employer’s
Liability Insurance.
Employer’s liability insurance in amounts at least equal to the commercial
general liability insurance limits set forth in Section 1.1 or such higher
limits as may be applicable for such insurance under
Section 7.3.2.
7.3.5 Insurance
During Construction.
At all
times during which Tenant undertakes any Alterations and Improvements or
other
construction or work on or about the Premises, (a) all-risk builder’s risk
insurance in such amount necessary to provide full replacement coverage to
the
Premises as improved by such construction or work and (b) owner’s
contingent or protective liability insurance with respect to such construction
in amounts at least equal to the commercial general liability insurance limits
set forth in Section 1.1 or such higher limits as may be applicable under
Section 7.3.2. Tenant shall further cause its contractors and
subcontractors for any such work to take out and maintain workmen’s compensation
insurance with statutory limits covering all of their employees working on
the
Premises or otherwise involved in such construction.
7.3.6 Automobile
Liability Insurance.
At all
times during which Tenant or its contractors bring or operate motor vehicles
on,
from or about the Premises, motor vehicle liability insurance on all of Tenant’s
and its contractors’ motor vehicles, in amounts at least equal to the commercial
general liability insurance limits set forth in Section 1.1 or such higher
limits as may be applicable for such insurance under
Section 7.3.2.
7.3.7 Additional
Insurance.
Such
further insurance in such amounts as Landlord or any Mortgagee may from time
to
time require, provided that (a) such insurance is, when required,
customarily carried in the area in which the Premises are located on property
similar to the Premises and used for similar purposes, and (b) such amounts
are, when required, not higher than the amounts customarily carried in the
area
in which the Premises are located on property similar to the Premises and
used
for similar purposes.
7.4 General
Requirements.
All
policies required under this Article VII shall be obtained from responsible
companies qualified to do business in the State of Texas and in good standing
therein. All such companies must be rated A or higher by A.M. Best, or have
a comparable rating from a comparable rating organization, and must otherwise
be
reasonably satisfactory to Landlord. Tenant shall be named as the insured
and
Landlord as an additional insured under all liability policies. Any Mortgagee
of
which Landlord gives Tenant notice shall also be named as an additional insured
on such liability policies. Such policies shall have cross liability coverage
endorsements. Liability limits may be achieved by obtaining so-called umbrella
policies over the basic coverage. Tenant shall furnish Landlord with original
certificates and copies of all policies prior to the beginning of the Term
and
of each renewal policy at least 30 days prior to the expiration of the policy
it
renews. Tenant shall also furnish Landlord with reasonable evidence of the
timely payment of all premiums for such policies. Each policy under which
the
Landlord or any such Mortgagee is an additional insured shall be non-cancelable
with respect to Landlord’s or such Mortgagee’s interest without at least 30
days’ prior written notice thereto. In the event provision for any such
insurance is to be by a blanket insurance policy, the policy shall allocate
a
specific amount of coverage to the Premises, which allocation shall be
sufficient in amount to satisfy the requirements of this
Article VII.
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7.5 Non-Subrogation
Provisions.
All
property damage insurance which is carried by either Party with respect to
the
Premises, whether or not required, shall include provisions which either
designate the other Party as one of the insureds or deny to the insurer
acquisition by subrogation of rights of recovery against the other Party
to the
extent such rights have been waived by the insured Party prior to occurrence
of
loss or injury, insofar as and to the extent that such provisions may be
effective without making it impossible to obtain insurance coverage from
responsible companies qualified to do business in the State of Texas (even
though extra premium may result therefrom). In the event that extra premium
is
payable by either Party as a result of this provision, the other Party shall
reimburse the Party paying such premium the amount of such extra premium.
If, at
the request of one Party, this non-subrogation provision is waived as to
such
Party, then the obligation of reimbursement by such Party shall cease for
such
period of time as such waiver shall be effective, but nothing contained in
this
Section 7.5 shall derogate from or otherwise affect releases elsewhere
herein contained of either Party for claims. Each Party shall be entitled
to
have duplicates or certificates of any policies containing such provisions.
Each
Party hereby waives all rights of recovery against the other for loss or
injury
against which the waiving Party is protected by insurance containing said
non-subrogation provisions, reserving, however, any rights with respect to
any
excess of loss or injury over the amount recovered by such
insurance.
ARTICLE
VIII
Casualty
8.1 Right
to Terminate.
In the
event that all or any portion of the Premises are damaged or destroyed by
fire
or other casualty and such damage or destruction exceeds twenty five percent
(25%) of the value of the Premises, then either Party may terminate this
Lease
by notice to the other party within 30 days after such damage or destruction.
In
the event that all or any portion of the Premises are damaged or destroyed
by
fire or other casualty and such damage or destruction prevents Tenant’s material
use of the Premises for thirty (30) consecutive days, then Tenant shall have
the
right, upon written notice to Landlord, to terminate this Lease.
8.2 Restoration.
If the
Premises are damaged or destroyed by fire or other casualty and this Lease
is
not terminated pursuant to Section 8.1, then Landlord shall promptly and
diligently repair and restore the Premises as nearly as practicable to their
condition prior to such damage or destruction, and in any event to a condition
reasonably suitable for Tenant’s use and occupancy, but subject and only to the
extent allowed by (a) then Applicable Laws and (b) the net insurance
proceeds available to Landlord on account of such damage or destruction after
deducting the reasonable costs of collecting such proceeds and any amount
retained by any Mortgagee pursuant to the terms of its Mortgage, it being
understood and agreed that Landlord shall not be obligated to repair or restore
if and to the extent such proceeds are not made available to it for such
purpose
by any Mortgagee. Rent shall be equitably abated until Landlord restores
the
Premises to a condition reasonably suitable for Tenant’s use and occupancy. If
Landlord fails so to restore within 6 months after the occurrence of such
damage
or destruction, then, regardless of the reason for such failure (and including
where a Mortgagee refused to make insurance proceeds available for repair
and
restoration), Tenant may terminate this Lease by notice to Landlord within
30
days after the expiration of such 6 month period. Landlord shall not be
obligated to restore any Alterations and Improvements constructed by Tenant
on
the Premises. Rather, Tenant shall be responsible for repair and restoration
of
any such Alterations and Improvements which it has made.
-19-
ARTICLE
IX
Eminent
Domain
9.1 Taking
of Entire Premises.
In the
event that the entire Premises are taken by condemnation or eminent domain,
then
this Lease shall terminate on the date when title passes to the taking
authority, and Rent shall be pro rated and paid to such date.
9.2 Partial
Taking - Termination.
In the
event that only a portion of the Premises are so taken but such portion exceeds
twenty five percent (25%) of the value thereof, then Landlord may terminate
this
Lease by notice to Tenant within 30 days after the date title passes to the
taking authority, and Rent shall be pro-rated and paid to such date in the
same
manner as provided in Section 9.1. In the event that only a portion of the
Premises are so taken, if such taking materially affects Tenant’s ability to use
the Premises for the Permitted Use, Tenant shall at its discretion terminate
this Lease immediately upon 30 days written notice. .
9.3 Partial
Taking - Restoration.
In the
event that only a portion of the Premises are so taken but this Lease is
not
terminated pursuant to Section 9.2 then Landlord shall promptly and
diligently repair and restore the Premises or what remains thereof as nearly
as
practicable to their condition before such taking and in any event to a
condition reasonably suitable for Tenant’s use and occupancy, but subject and
only to the extent permitted by (a) then Applicable Laws and (b) the
net takings award available to Landlord after deducting the reasonable costs
of
obtaining such award and any amounts retained by any Mortgagee pursuant to
the
terms of its Mortgage, it being understood and agreed that Landlord shall
not be
obligated to repair and restore if and to the extent such award is not made
available to it for such purpose by any such Mortgagee. Rent shall be equitably
abated until Landlord restores the Premises to a condition reasonably suitable
for Tenant’s use and occupancy, and, in the case of a taking which permanently
reduced the Premises, Rent shall be equitably abated for the remainder of
the
Term in just proportion to such permanent reduction. If Landlord fails so
to
restore the Premises within 6 months after the occurrence of such taking,
then,
regardless of the reason for such failure (and including where a Mortgagee
refused to make the takings award or an adequate portion thereof available
for
repair and restoration), Tenant may terminate this Lease by notice to Landlord
within 30 days after the expiration of such 6 month period. Landlord shall
not be obligated to restore any Alterations and Improvements constructed
by
Tenant in the Premises. Rather, Tenant shall be responsible for repair and
restoration of any such Alterations and Improvements which it has
made.
9.4 Eminent
Domain Award.
All
awards, damages and compensation on account of any such taking of the Premises
shall belong exclusively to Landlord, and Tenant hereby assigns and releases
to
Landlord all of Tenant’s right to any such awards, damages and compensation,
except only that Tenant may, at its own expense, make a separate claim to
the
taking authority for Tenant’s personal property and relocation expenses,
provided that Landlord’s award is not reduced thereby. Tenant shall execute and
deliver to Landlord all instruments as may be necessary or desirable to confirm
Tenant’s foregoing assignment and release to Landlord of all such awards,
damages and compensation. Tenant hereby irrevocably appoints Landlord, which
appointment is coupled with an interest, as Tenant’s attorney-in-fact to execute
and deliver any such instruments for Tenant in Tenant’s name, place and stead,
should Tenant fail to do so.
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ARTICLE
X
Yield
Up
10.1 Yield
Up.
At the
expiration of the Term or earlier termination of this Lease, Tenant shall
surrender all keys to the Premises, remove all of its furnishings, fixtures,
equipment, materials, supplies, inventory, effects and other personal property
from the Premises, (including, without limitation, all of Tenant’s trade
furnishings, trade fixtures and equipment), leave any Alterations and
Improvements made by Tenant, remove all of its signs wherever located, repair
all damage caused by any such removal and yield up the Premises (including
all
Alterations and Improvements) in the same good, proper, clean, sanitary,
safe,
sound, working and tenantable order, condition and repair in which Tenant
is
obliged to keep and maintain the Premises by the provisions of this Lease.
Any
of Tenant’s property not so removed shall be deemed abandoned and may be
retained by Landlord or may be removed and disposed of by Landlord in such
manner as Landlord shall determine. Tenant shall pay Landlord the entire
cost
and expense incurred by Landlord in effecting such removal and disposition
and
in making any incidental repairs and replacements to the Premises. Without
limiting the generality of the foregoing, Tenant shall have the right upon
the
expiration or termination of this Lease to remove all of its trade fixtures,
furnishings and equipment from the Premises, provided that it complies with
all
requirements of this Section 10.1 in doing so.
10.2 Holdover.
For each
day after the expiration of the Term, or the earlier termination of this
Lease,
and prior to Tenant’s performance of its obligation to yield up the Premises
under this Article, Tenant shall pay to Landlord as rent an amount equal
to 150%
of the Base Rent computed on a daily basis, together with all Additional
Rent
and other charges payable with respect to each such day. Tenant shall further
indemnify Landlord against all loss, cost and damage suffered by Landlord
as a
result of Tenant’s delay in surrendering the Premises as above provided. Any
such holding over by Tenant shall be a tenancy at sufferance only.
ARTICLE
XI
Defaults
11.1 Events
of Default.
(a) If Tenant fails to make any payment of Base Rent, Additional Rent or
other charges when due hereunder and does not cure such default within ten
days
after notice thereof from Landlord, or (b) if Tenant fails to procure or
maintain any of the insurance required hereunder and does not cure such default
within ten days after notice thereof from Landlord, or (c) if Tenant fails
to perform any of its other obligations under this Lease and does not cure
such
default within 30 days after notice thereof from Landlord, or, if such default
is not reasonably susceptible of cure within 30 days, if Tenant does not
commence to cure within such 30 days and thereafter diligently and continuously
prosecute such cure to completion, or (d) if Tenant or any present or
future guarantor of all or any portion of Tenant’s obligations under this Lease
(a “Guarantor”) becomes insolvent, or (e) if the leasehold estate under
this Lease or any substantial part of the property of Tenant or of any Guarantor
is taken on execution, or by other process of law, or is attached or subjected
to any other involuntary encumbrance and such property is not reconveyed
to
Tenant or Guarantor or such attachment or encumbrance is not dissolved within
60
days thereafter, or (f) if a receiver, trustee, custodian, guardian,
liquidator or similar agent is appointed with respect to Tenant or any
Guarantor, or if any such person or a mortgagee, secured party or other creditor
takes possession of the Premises or of any substantial part of the property
of
Tenant or of any Guarantor, and, in either case, if such appointment or taking
of possession is not terminated within 60 days after it first occurs, or
(g) if a petition is filed by or with the consent of Tenant or of any
Guarantor under any federal or state law concerning bankruptcy, insolvency,
reorganization, arrangement, or relief from creditors, or (h) if a petition
is filed against Tenant or against any Guarantor under any federal or state
law
concerning bankruptcy, insolvency, reorganization, arrangement, or relief
from
creditors, and such petition is not dismissed within 60 days thereafter, or
(i) if Tenant or any Guarantor which is a corporation or other entity
dissolves or is dissolved or liquidates or adopts any plan or commences any
proceeding, the result of which is intended to include dissolution or
liquidation (each of the foregoing an “Event of Default”), then, and in any of
such cases, Landlord and the agents and servants of Landlord lawfully may,
in
addition to and not in derogation of any remedies for any preceding breach
of
covenant, immediately or at any time thereafter and without demand or notice
and
with or without process of law (forcibly, if necessary) enter into and upon
the
Premises or any part thereof in the name of the whole or mail a notice of
termination addressed to Tenant, and repossess the same as of Landlord’s former
estate and expel Tenant and those claiming through or under Tenant and remove
its and their effects (forcibly, if necessary) without being deemed guilty
of
any manner of trespass and without prejudice to any remedies which might
otherwise be used for arrears of rent or prior breach of covenant, and, upon
such entry or mailing as aforesaid, this Lease shall terminate, Tenant hereby
waiving all statutory rights (including, without limitation, rights of
redemption, if any, to the extent such rights may be lawfully waived) and
Landlord, without notice to Tenant, may store Tenant’s effects, and those of any
person claiming through or under Tenant at the expense and risk of Tenant,
and,
if Landlord so elects, may sell such effects at public auction or private
sale
and apply the net proceeds to the payment of all sums due to Landlord from
Tenant, if any, and pay over the balance, if any, to Tenant. Upon such
termination, Tenant shall immediately vacate and surrender the Premises and
deliver possession thereof to Tenant.
-21-
11.2 Remedies.
In the
event that this Lease is terminated under any of the provisions contained
in
Section 11.1 or shall be otherwise terminated for breach of any obligation
of Tenant, Tenant covenants to pay forthwith to Landlord, as compensation,
the
excess of the total rent reserved for the residue of the Term over the rental
value of the Premises for said residue. In calculating the rent reserved,
there
shall be included, in addition to the Base Rent and Additional Rent, the
value
of all other considerations agreed to be paid or performed by Tenant for
said
residue. Tenant further covenants as additional and cumulative obligations
after
any such termination to pay punctually to Landlord all the sums and to perform
all the obligations which Tenant covenants in this Lease to pay and to perform
in the same manner and to the same extent and at the same time as if this
Lease
had not been terminated. In calculating the amounts to be paid by Tenant
pursuant to the immediately preceding sentence, Tenant shall be credited
with
the portion of any amount paid to Landlord as compensation as in this
Section 11.2 provided allocable to the corresponding portion of the Term,
and also with the net proceeds of any rent obtained by Landlord by reletting
the
Premises, after deducting all Landlord’s reasonable expenses in connection with
such reletting, including, without limitation, all repossession costs, brokerage
commissions, fees for legal services and expenses of preparing the Premises
for
such reletting, it being agreed by Tenant that Landlord may, but shall not
be
obligated to, (a) relet the Premises or any part or parts thereof, for a
term or terms which may at Landlord’s option be equal to or less than or exceed
the period which would otherwise have constituted the balance of the Term
and
may grant such concessions and free rent as Landlord in its reasonable judgment
considers advisable or necessary to relet the same, (b) make such
alterations, repairs and decorations in the Premises as Landlord in its
reasonable judgment considers advisable or necessary to relet the same, and
(c) keep the Premises vacant unless and until Landlord is able to rent the
Premises to a tenant which is at least as desirable and financially responsible
as Tenant is on the date of this Lease, on terms not less favorable to Landlord
than those of this Lease. No action of Landlord in accordance with the foregoing
or failure to relet or to collect rent under reletting shall operate or be
construed to release or reduce Tenant’s liability as aforesaid.
-22-
In
lieu of
any other damages or indemnity and in lieu of full recovery by Landlord of
all
sums payable under all the foregoing provisions of this Section 11.2,
Landlord may, by notice to Tenant, at any time after this Lease is terminated
under any of the provisions contained in Section 11.1 or is otherwise
terminated for breach of any obligation of Tenant and before such full recovery,
elect to recover, and Tenant shall thereupon pay, as liquidated damages,
an
amount equal to the aggregate of the Base Rent and Additional Rent accrued
in
the year ended prior to such termination plus the amount of Rent of any kind
accrued and unpaid at the time of termination and less the amount of any
recovery by Landlord under the foregoing provisions of this Section 11.2 up
to the time of payment of such liquidated damages.
Nothing
contained in this Lease shall, however, limit or prejudice the right of Landlord
to prove for and obtain in proceedings under any federal or state law relating
to bankruptcy or insolvency or reorganization or arrangement an amount equal
to
the maximum allowed by any statute or rule of law in effect at the time when,
and governing the proceedings in which, the damages are to be proved, whether
or
not the amount be greater than the amount of the loss or damages referred
to
above.
11.3 Remedies
Cumulative.
Any and
all rights and remedies which Landlord may have under this Lease or at law
or
equity shall be cumulative and shall not be deemed inconsistent with each
other,
and any two or more of such rights and remedies may be exercised at the same
time insofar as permitted by Applicable Laws.
11.4 Landlord’s
Right to Cure Defaults.
Landlord
may, but shall not be obligated to, at any time following ten days’ prior notice
to Tenant, except in cases of emergency when no notice shall be required,
cure
any default by Tenant under this Lease; and whenever Landlord so elects,
all
costs and expenses incurred by Landlord, including reasonable attorneys’ fees in
curing such default, shall be paid by Tenant to Landlord as Additional Rent
on
demand, together with interest thereon at the Late Payment/Default Rate from
the
date of payment by Landlord to the date of payment by Tenant.
-23-
11.5 Payment
of Landlord’s Cost of Enforcement.
Tenant
shall pay on demand Landlord’s expenses, including reasonable attorneys’ fees,
incurred in enforcing any obligation of Tenant under this Lease or in curing
any
default by Tenant under this Lease.
11.6 Effect
of Waivers of Default.
Any
consent or permission by Landlord to any act or omission which otherwise
would
be a breach of any covenant or condition herein, or any waiver by Landlord
of
the breach of any covenant or condition herein, shall not in any way be held
or
construed (unless expressly so declared) to operate so as to impair the
continuing obligation of any covenant or condition herein or otherwise, except
as to the specific instance, operate to permit similar acts or omissions.
The
failure of Landlord to seek redress for violation of, or to insist upon the
strict performance of, any covenant or condition of this Lease shall not
be
deemed a waiver of such violation nor prevent a subsequent act, which would
have
originally constituted a violation, from having all the force and effect
of an
original violation. The receipt by Landlord of rent with knowledge of the
breach
of any covenant of this Lease shall not be deemed to have been a waiver of
such
breach by Landlord, or by Tenant, unless such waiver be in writing signed
by the
party to be charged. No consent or waiver, express or implied, by Landlord
to or
of any breach of any agreement or duty shall be construed as a waiver or
consent
to or of any other breach of the same or any other agreement or
duty.
11.7 No
Accord and Satisfaction.
No
acceptance by Landlord of a lesser sum than the Base Rent, Additional Rent
or
any other charge then due shall be deemed to be other than on account of
the
earliest installment of such rent or charge due, unless Landlord elects by
notice to Tenant to credit such sum against the most recent installment due,
nor
shall any endorsement or statement on any check or any letter accompanying
any
check or payment as rent or other charge be deemed a waiver, an agreement
or an
accord and satisfaction, and Landlord may accept such check or payment without
prejudice to Landlord’s right to recover the balance of such installment or
pursue any other remedy in this Lease provided.
ARTICLE
XII
Mortgages
12.1 Rights
of Mortgagees; Limitation of Liabilities.
Until
the Mortgagee under any Mortgage shall enter and take possession of the Premises
for the purposes of foreclosure, such Mortgagee shall have only such rights
of
Landlord as are necessary to preserve the integrity of this Lease as security.
Upon entry and taking possession of the Premises for the purpose of foreclosure,
such Mortgagee shall have all the rights of Landlord. Notwithstanding any
other
provision of this Lease to the contrary, including, without limitation,
Section 13.4, no such Mortgagee shall be liable to perform or liable in
damages for failure to perform, any of the obligations of Landlord unless
and
until such Mortgagee shall enter and take possession of the Premises for
the
purpose of foreclosure. Upon entry for the purpose of foreclosure, such
Mortgagee shall be liable to perform all of the obligations of Landlord accruing
from and after such entry, subject to and with the benefit of the provisions
of
Section 13.4, provided that a discontinuance of any foreclosure proceeding
shall be deemed a conveyance under such provisions to the owner of the Premises.
No Mortgagee shall ever be liable to perform any obligations of Landlord
accruing before such entry. No Base Rent, Additional Rent or any other charge
shall be paid more than ten days prior to the due dates thereof and
payments made in violation of this provision shall (except to the extent
that
such payments are actually received by a Mortgagee in possession or in the
process of foreclosing its Mortgage) be a nullity as against such Mortgagee,
and
Tenant shall be liable for the amount of such payments to such Mortgagee.
The
covenants and agreements contained in this Lease with respect to the rights,
powers and benefit of a Mortgagee (including, without limitation, the covenants
and agreements contained in this Section 12.1) constitute a continuing
offer to any person, corporation or other entity, which by accepting a Mortgage
subject to this Lease assumes the obligations herein set forth with respect
to
such Mortgagee; such Mortgagee is hereby constituted a party to this Lease
as an
obligee hereunder to the same extent as though its name were written hereon
as
such; and such Mortgagee shall be entitled to enforce such provisions in
its own
name. Tenant agrees on request of Landlord to execute and deliver from time
to
time any agreement which may be necessary to implement the provisions of
this
Section 12.1.
-24-
12.2 Subordination
to Mortgages.
This
Lease is and shall be subject and subordinate to any present or future Mortgage
provided that the Mortgagee agrees in writing not to terminate this Lease
nor
otherwise disturb Tenant’s possession of the Premises in the event of a
foreclosure, so long as no Event of Default shall have occurred and is
continuing.
ARTICLE
XIII
Miscellaneous
Provisions
13.1 Notices
from One Party to the Other.
All
notices required or permitted under this Lease shall be in writing and delivered
by hand or mailed by registered or certified mail, postage prepaid and return
receipt requested, addressed if to Tenant to Tenant’s Address designated in
Section 1.1 or such other address as Tenant shall have last designated by
notice in writing to Landlord and, if to Landlord, to Landlord’s Address
designated in Section 1.1 or such other address as Landlord shall have last
designated by notice in writing to Tenant. All notices shall be effective
upon
delivery to the address of the addressee (even if such addressee refuses
delivery thereof).
13.2 Quiet
Enjoyment.
Landlord
agrees that, upon Tenant’s paying the rent and performing and observing the
terms, covenants, conditions and provisions on its part to be performed and
observed, Tenant shall and may peaceably and quietly have, hold and enjoy
the
Premises during the Term without any manner of hindrance or molestation from
Landlord or anyone claiming under Landlord, subject, however, to the terms
and
provisions of this Lease.
13.3 Lease
not to be Recorded.
Tenant
agrees that it will not record this Lease. Both Parties shall, upon the request
of either, execute and deliver a notice of this Lease in such form, if any,
as
may be permitted by Applicable Laws. If this Lease is terminated before the
Expiration Date, then the Parties shall execute, deliver and record an
instrument acknowledging such fact and the actual date of termination of
this
Lease, and Tenant hereby appoints Landlord its attorney-in-fact, coupled
with an
interest, with full power of substitution to execute such
instrument.
-25-
13.4 Bind
and Inure; Limitation of Landlord’s Liability.
The
obligations of this Lease shall run with the land, and this Lease shall be
binding upon and inure to the benefit of the Parties hereto and their respective
successors, assigns and legal representatives. No owner of the Premises shall
be
liable under this Lease except for breaches of Landlord’s obligations occurring
while owner of the Premises. The obligations of Landlord shall be binding
upon
the assets of Landlord which comprise the Premises but not upon other assets
of
Landlord. No individual partner, member, trustee, stockholder, officer,
director, manager, employee or beneficiary of Landlord shall be personally
liable under this Lease. Tenant shall look solely to Landlord’s interest in the
Premises in pursuit of its remedies upon Landlord’s default hereunder. The
general assets of Landlord and of the individual partners, members, trustees,
stockholders, officers, directors, managers, employees or beneficiaries of
Landlord shall not be subject to levy, execution or other enforcement procedure
for the satisfaction of the remedies of Tenant.
13.5 Force
Majeure.
In any
case where either Party is required to do any acts, then, except where
specifically provided in this Lease and to the contrary, delays caused by
or
resulting from acts of God, war, civil commotion, fire, flood or other casualty,
labor difficulties, shortages of labor, materials or equipment, government
regulations, unusually severe weather, or other causes beyond such Party’s
reasonable control shall not be counted in determining the time during which
such acts shall be completed, whether such time be designated by a fixed
date, a
fixed time or a “reasonable time”, and such time shall be deemed to be extended
by the period of such delay.
13.6 Landlord’s
Default.
Landlord
shall not be deemed to be in default in the performance of any of its
obligations hereunder unless it shall fail to perform such obligations and
such
failure shall continue for a period of 30 days following receipt of notice
from Tenant or, if such default is not reasonably susceptible of cure within
30
days, if Landlord does not commence to cure within such 30 days and thereafter
diligently and continuously prosecute such cure to completion
13.7 Brokerage.
Landlord
warrants and represents that it has had no dealings with any broker or agent
in
connection with this Lease. Tenant represents and warrants that it has not
engaged the services of any real estate broker or other broker or finder
in
connection with this transaction except Tenant’s Broker. Tenant shall defend,
with counsel approved by Landlord, hold harmless and indemnify Landlord from
and
against any and all cost, expense or liability for any compensation, commissions
and charges claimed by Tenant’s Broker with respect to Tenant’s dealings in
connection with this Lease or the negotiation. The terms and provisions of
this
Section 13.7 shall survive the termination of this Lease.
13.8 Estoppel
Certificate.
Upon not
less than ten days’ prior notice by Landlord, Tenant shall execute, acknowledge
and deliver to Landlord a statement in writing, addressed to such party as
Landlord shall designate in its notice to Tenant, certifying that this Lease
is
unmodified and in full force and effect and that Tenant has no defenses,
offsets
or counterclaims against is obligations to pay the Base Rent, Additional
Rent
and any other charges and to perform its other covenants under this Lease
(or,
if there have been any modifications that the same is in full force and effect
as modified and stating the modifications and, if there are any defenses,
offsets or counterclaims, setting them, forth in reasonable detail), the
dates
to which the Base Rent, Additional Rent and other charges have been paid
and a
statement that Landlord is not in default hereunder (or if in default, the
nature of such default, in reasonable detail). Any such statement delivered
pursuant to this Section 13.8 may be relied upon by any prospective
purchaser or mortgagee of the Premises or any prospective assignee of any
Mortgagee.
-26-
13.9 Landlord’s
Consents.
No
approval or consent hereunder by Landlord, express or implied, in any one
case
or instance shall be deemed an approval or consent in any other case or
instance. Notwithstanding Section 5.7, whenever Tenant requests Landlord
to take
any action not required of Landlord under this Lease or give any consent
required or permitted under this Lease, Tenant shall reimburse Landlord for
Landlord’s reasonable, out-of-pocket costs payable to third parties and incurred
by Landlord in reviewing the proposed action or consent, including reasonable
attorneys’, engineers’ or architects’ fees, within 30 days after Landlord’s
delivery to Tenant of a statement of such costs. Tenant shall be obligated
to
make such reimbursement without regard to whether Landlord consents to any
such
proposed action.
13.10 Furniture
and related items.
All case
goods, modular office furniture and fixtures owned by Landlord and located
in
the Premises as of the Commencement Date will be made available for the
exclusive use and enjoyment of Tenant during the Term and any extensions
thereof. Landlord make no warranties or representation concerning the condition
of the property described herein and all such use and enjoyment by Tenant
shall
be at Tenant’s sole risk and expense and subject to the indemnity provisions
given by Tenant to Landlord as contained herein.
13.11 Tenant’s
Post-Termination Obligations.
The
expiration or termination of this Lease shall not relieve Tenant of any of
its
obligations hereunder which by their terms or nature Tenant is to perform
after
such expiration or termination, nor of any indemnity given by Tenant hereunder,
all of which shall continue and remain in full force and effect for as long
as
allowed by Applicable Laws.
13.12 Applicable
Law.
This
Lease shall be governed by and construed in accordance with the laws of the
State of Texas. If any term, covenant, condition or provision of this Lease
or
the application thereof to any person or circumstances shall be declared
invalid, or unenforceable by the final ruling of a court of competent
jurisdiction having final review, the remaining terms, covenants, conditions
and
provisions of this Lease and their application to persons or circumstances
shall
not be affected thereby and shall continue to be enforced and recognized
as
valid agreements of the Parties, and in the place of such invalid or
unenforceable provision, there shall be substituted a like, but valid and
enforceable provision which comports to the findings of the aforesaid court
and
most nearly accomplishes the original intention of the Parties.
13.13 No
Other Agreement.
There
are no oral or written agreements between Landlord and Tenant affecting this
Lease. This Lease may be amended, and the provisions hereof may be waived
or
modified, only by instruments in writing executed by Landlord and
Tenant.
-27-
13.14 No
Representations by Landlord.
Neither
Landlord nor any agent of Landlord has made any representations or promises
with
respect to the Premises except as herein expressly set forth, and no rights,
privileges, easements or licenses are granted to Tenant except as herein
expressly set forth.
13.15 Time
of
Essence.
Time is
of the essence with respect to all terms, conditions and provisions of this
Lease.
13.16 Titles.
The
titles of the several Articles and Sections contained herein are for convenience
only and shall not be considered in construing this Lease.
13.17 “Landlord”
and “Tenant”.
Unless
repugnant to the context, the words “Landlord” and “Tenant” appearing in this
Lease shall be construed to mean those named above and their respective
successors, assigns, legal representatives and those claiming through or
under
them respectively. If there be more than one tenant, then the obligations
imposed by this Lease upon Tenant shall be joint and several.
13.18 Submission
Not an Offer.
The
submission of a draft of this Lease or a summary of some or all of its
provisions does not constitute an offer to lease or demise the Premises,
it
being understood and agreed that neither Landlord nor Tenant shall be legally
bound with respect to the leasing of the Premises unless and until this Lease
has been executed and delivered by both Landlord and Tenant.
Executed
under seal as of the Date of this Lease.
|
Landlord:
By:
/s/
▇▇▇▇
▇▇▇▇▇▇▇
Print
Name: ▇▇▇▇ ▇▇▇▇▇▇▇
Print
Title: Owner
|
|
Tenant:
PHARMAFRONTIERS
CORPORATION
By:
/s/
▇. ▇.
▇▇▇▇▇
Print
Name: ▇.▇. ▇▇▇▇▇
Print
Title: CFO and Secretary
|
-28-
EXHIBIT
A
Legal
Description of the Land
-29-
EXHIBIT
B
Plan
of
Land
-30-
EXHIBIT
C
Rent
Schedule
|
Rent
|
Annual
Base Rent
|
|
|
Year
1:
|
$5.75
per RSF
|
$59,535.50
|
|
Year
2:
|
$10.75
per RSF
|
$111,305.50
|
|
Year
3:
|
$13.25
per RSF
|
$137,190.50
|
|
Year
4:
|
$13.25
per RSF
|
$137,190.50
|
|
Year
5:
|
$14.25
per RSF
|
$147,544.50
|
|
Year
6:
|
$14.25
per RSF
|
$147,544.50
|
|
Year
7:
|
$14.25
per RSF
|
$147,544.50
|
|
Year
8:
|
$15.25
per RSF
|
$157,898.50
|
|
Year
9:
|
$15.25
per RSF
|
$157,898.50
|
|
Year
10:
|
$15.25
per RSF
|
$157,898.50
|
-31-
EXHIBIT
D
Landlord’s
Work
Approximately
twenty (20) additional parking spaces to be located at Landlord’s sole
discretion.
-32-
EXHIBIT
E
Permitted
Hazardous Material
Chemical
List by Department
Research
and
Development Laboratories
|
AIM-V
medium
|
Human
Serum
|
Human
Interleukin 2
|
|
RPMI
1640 medium
|
Lyophilized
ATP Standard Solution
|
CXCR-3,
antibody to
|
|
L-glutamine
|
Lyophilized
ATP Substrate Solution
|
FACS
Lysin Buffer (10X)
|
|
Penicillin/Streptomycin
|
Synthetic
Peptides
|
FACS
Perm II (10X)
|
|
Trypan
Blue Solution
|
Trypsin
|
Propidium
Iodide
|
|
Hank's
Balanced Salt Solution
|
Anti-hCD3g
antibody
|
Origen
Freezing medium
|
|
DEPC-treated
Water
|
DNA
Quality Control particles
|
Isopropanol
|
|
Ficoll-Paque
Plus
|
CaliBRITE
3 beads
|
Dynabeads
CD3/CD28 T Cell expander
|
|
PHA
Stock solution (1 mg/mL)
|
BD
Multi-Check Control
|
▇▇▇▇-▇▇▇▇▇
cleaning solution
|
|
Concanavalin
A (Con A)
|
Phosphate
Buffered Saline (10X)
|
Glacial
Acetic Acid
|
|
ATP
Lite Kit
|
Ultra
bleach
|
CD-3
antibody
|
|
Mitomycin
C Stock solution (0.5 mg/mL)
|
Albumin
(Bovine)
|
CD-4
antibody
|
|
Formaldehyde
|
Deoxyribonuclease
I
|
CD-8
antibody
|
|
Ethylenediaminetetraacetic
acid
|
Cell
Mab Medium
|
CD-11b
antibody
|
|
Sporicidin
cleaning solution
|
Brefeldin
A
|
CD-14
antibody
|
|
Sodium
azide
|
Dimethylsulfoxide
|
CD-15
antibody
|
|
Flow
check Fluorospheres
|
FACS
Rinse
|
CD-19
antibody
|
|
Click’s
medium
|
FACS
Clean
|
CD-20
antibody
|
|
Cell
Genix Dendritic Cell Medium
|
FACS
Flow
|
CD-25
antibody
|
|
Gamma
Interferon Secretion Assay
|
Sodium
dodecyl sulfate
|
CD-45
antibody
|
|
Annexin
V-FITC Apoptosis Detection Kit
|
Sodium
Chloride
|
CD-69
antibody
|
|
BrdU
Flow Kit
|
TCR
antibody
|
CD-80
antibody
|
|
FITC-conjugated
Antibody set
|
Gamma
Interferon antibody
|
CD-86
antibody
|
|
2-mercaptoethanol
|
Thymidine
-H3
|
CD34
antibody
|
Manufacturing
& Production Laboratory
|
Ficoll-Paque
Plus
|
Peptide
#1 (MBP - Myelin Basic Protein)
|
Trypan
Blue
|
|
HEPES
Buffer
|
Peptide
#2 (MBP - Myelin Basic Protein)
|
Phytohemagglutinin
|
|
AIM-V
Medium
|
Peptide
#3 (PLP - Proteolipid Protein)
|
Isopropanol
|
|
RPMI
1640 Medium
|
Peptide
#4 (PLP - Proteolipid Protein)
|
▇▇▇▇-▇▇▇▇▇
|
|
Dimethylsulfoxide
|
Peptide
#6 (MOG - Myelin Oligodendrocyte Glycoprotein)
|
Sporicidin
|
|
Hank's
Balanced Salt Solution
|
Peptide
#7 (MOG - Myelin Oligodendrocyte Glycoprotein)
|
Bleach
|
|
Human
AB Serum
|
Drierite
|
Glacial
Acetic Acid
|
|
Origen
Freezing Medium
|
Proleukin,
recombinant human interleukin 2
|
L-Glutamine
|
|
Sodium
Chloride
|
Sterile
water
|
-33-
Quality
Control Laboratories
|
Trypticase
Soy Agar with 5% Sheep's Blood
|
BBL
▇▇▇▇▇▇▇▇▇ Standard No. 0.5
|
Omni
Pur Tris-EDTA Buffer Solution
|
|
Thioglycollate
Medium
|
BACTEC
PEDS Plus/F
|
100
bp DNA Ladder (50 ug/mL)
|
|
Tryptic
Soy Broth
|
Tris-Acetate-EDTA
(TAE) 10X Buffer
|
DEPC-treated
Water
|
|
Sabouraud-Dextrose
Agar
|
Gram
Stain Kit: Crystal Violet
|
Nuclease
Free Water
|
|
DNA
Gel Loading Buffer
|
Gram
Stain Kit: Grams Iodine
|
Hank's
Balanced Salt Solution
|
|
Anaero-Indicator
|
Gram
Stain Kit: Decolorizer
|
DNA-Zap
(Solution 1 and Solution 2)
|
|
Lymphoprep
|
Gram
Stain Kit: Safranin Stain
|
Septihol
|
|
Endotoxin
(Escherichia coli) Control Standard
|
Saline
0.85% Solution
|
Ultraclean
DNA BloodSpin Kit (50 purifications)
|
|
Pyrotubes
Depyrogenated Reaction Tubes (Sample)
|
Pack-Anaero
|
Proteinase
K
|
|
Pyrotubes
Depyrogenated Reaction Tubes (Dilution)
|
Mycoplasma
Detection Kit (Version 2.0)
|
LAL
Reagent Water (LRW)
|
|
QualiSwab
- Streptococcus pyogenes
|
Mycoplasma
Detection Kit: M. pirum DNA
|
Methylene
Blue Chloride
|
|
Bactrol
Plus - Escherichia coli ATCC# 25922
|
Mycoplasma
Detection Kit: A. laidlawii DNA
|
Ethidium
Bromide
|
|
Bactrol
Plus - Staphylococcus aureus ATCC# 25923
|
Mycoplasma
Detection Kit: Lysis solution
|
667
Polaroid Film
|
|
Bactrol
Plus - Candida albicans ATCC# 14053
|
Mycoplasma
Detection Kit: 1st Stage Primer
|
RNAse
Away
|
|
NovaTaq
PCR Kit: 25 mm MgCL2
|
Mycoplasma
Detection Kit: 2nd Stage Primer
|
Parafilm
|
|
NovaTaq
PCR Kit: PCR grade water
|
Mycoplasma
Detection Kit: 1.1 X Taq Polymerase Buffer
|
Bleach
EZ Starter Kit
|
|
NovaTaq
PCR Kit: 10 mm dNTP Mix
|
Platinum
Taq DNA Polymerase (5 units/uL; 250 reactions)
|
Agarose
|
|
NovaTaq
PCR Kit: NovaTaq DNA Polymerase (5 u/uL)
|
Mycoplasma
Plus PCR Primer Set
|
TAP
(Thermal Activated) DNA polymerase (sample pack)
|
|
Limulus
Amebocyte Lysate (LAL) Pyrotell Multitest vials
|
Limulus
Amebocyte Lysate (LAL) Pyrotell Single Test vials
|
-34-