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EXHIBIT 10.17
LYNDON PLAZA
LEASE
DALLAS LYNDON CORPORATION, LANDLORD
NATIONAL TECHTEAM, INC., TENANT
AUGUST 17, 1995
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INDEX
ARTICLE I: DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Sec. 1.1. LEASED PREMISES . . . . . . . . . . . . . . . . . . . . . . . . . 1
Sec. 1.2. LEASE TERM . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Sec. 1.3. LEASE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II: GRANT OF LEASE . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Sec. 2.1. GRANT TO TENANT . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Sec. 2.2. TITLE AND CONDITION . . . . . . . . . . . . . . . . . . . . . . . . 1
Sec. 2.3. COVENANT OF QUIET ENJOYMENT . . . . . . . . . . . . . . . . . . . . 2
Sec. 2.4. SERVICES FURNISHED BY LANDLORD . . . . . . . . . . . . . . . . . . . 2
ARTICLE III: TERM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Sec. 3.1. PRIMARY TERM . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Sec. 3.2. LEASE RENEWAL . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
ARTICLE IV: PAYMENT OBLIGATIONS . . . . . . . . . . . . . . . . . . . . . . . . 4
Sec. 4.1. BASIC RENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Sec. 4.2. ADDITIONAL RENT . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Sec. 4.3. LATE CHARGES . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Sec. 4.4. RENTAL ESCALATION . . . . . . . . . . . . . . . . . . . . . . . . . 4
A. DEFINITIONS APPLICABLE TO THIS SECTION . . . . . . . . . . . . . . 4
B. PAYMENT OF RENTAL ESCALATION . . . . . . . . . . . . . . . . . . . 7
Sec. 4.5. PAYMENT OF RENT . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Sec. 4.6. SECURITY DEPOSIT . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Sec. 4.7. TAXES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Sec. 4.8. INSURANCE; INDEMNIFICATION . . . . . . . . . . . . . . . . . . . . . 9
A. LIABILITY INSURANCE . . . . . . . . . . . . . . . . . . . . . . . 9
B. CASUALTY INSURANCE . . . . . . . . . . . . . . . . . . . . . . . . 9
C. INCREASED INSURANCE PREMIUMS . . . . . . . . . . . . . . . . . . .10
D. WAIVER OF SUBROGATION . . . . . . . . . . . . . . . . . . . . . .10
E. INDEMNITY AND EXCULPATORY CLAUSE . . . . . . . . . . . . . . . . .10
Sec. 5.1. USE OF LEASED PREMISES . . . . . . . . . . . . . . . . . . . . . . .10
A. DESCRIPTION OF PERMITTED USE . . . . . . . . . . . . . . . . . .11
B. USE IN COMPLIANCE WITH LAWS . . . . . . . . . . . . . . . . . . .11
C. TENANT'S USE . . . . . . . . . . . . . . . . . . . . . . . . . . .12
Sec. 5.2. MAINTENANCE OF LEASED PREMISES . . . . . . . . . . . . . . . . . . .12
A. MAINTENANCE BY LANDLORD . . . . . . . . . . . . . . . . . . . . .12
B. ACCESS BY LANDLORD . . . . . . . . . . . . . . . . . . . . . . . .12
C. MAINTENANCE BY TENANT . . . . . . . . . . . . . . . . . . . . . .13
D. ALTERATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . .13
Sec. 5.3. SIGNS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
ARTICLE VI: SPECIAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . 14
Sec. 6.1. ASSIGNMENTS AND SUBLEASES . . . . . . . . . . . . . . . . . . . . 14
A. BY TENANT . . . . . . . . . . . . . . . . . . . . . . . . . . . .14
B. BY LANDLORD . . . . . . . . . . . . . . . . . . . . . . . . . . .15
Sec. 6.2. FORCE MAJEURE . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Sec. 6.3. ESTOPPEL CERTIFICATE . . . . . . . . . . . . . . . . . . . . . . . 15
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Sec. 6.4. SUBORDINATION OF LEASE . . . . . . . . . . . . . . . . . . . . . . 16
Sec. 6.6. PARKING FOR TENANT . . . . . . . . . . . . . . . . . . . . . . ..17
Sec. 6.7. RULES OF PROJECT . . . . . . . . . . . . . . . . . . . . . . . ..17
ARTICLE VII: DAMAGE AND CONDEMNATION . . . . . . . . . . . . . . . . . . . . . . ..17
Sec. 7.1. DAMAGE TO LEASED PREMISES . . . . . . . . . . . . . . . . . . . . . . . 18
A. SUBSTANTIAL DAMAGE . . . . . . . . . . . . . . . . . . . . . . . . .18
B. PARTIAL DAMAGE . . . . . . . . . . . . . . . . . . . . . . . . . . .18
Sec. 7.2. CONDEMNATION OF LEASED PREMISES . . . . . . . . . . . . . . . . . . . . 18
A. TOTAL CONDEMNATION . . . . . . . . . . . . . . . . . . . . . . . . .18
B. PARTIAL CONDEMNATION . . . . . . . . . . . . . . . . . . . . . . . .19
ARTICLE VIII: DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Sec. 8.1. EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . 19
Sec. 8.2. DEFAULT BY LANDLORD . . . . . . . . . . . . . . . . . . . . . . . 20
ARTICLE IX: REMEDIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Sec. 9.1. LANDLORD'S RIGHT TO CURE DEFAULT . . . . . . . . . . . . . . . . 20
Sec. 9.2. LANDLORD'S RIGHT TO RE-ENTER . . . . . . . . . . . . . . . . . . 20
Sec. 9.3. LANDLORD'S ELECTION TO TERMINATE OR RELET . . . . . . . . . . . . 21
Sec. 9.4. CHANGE OF LOCKS . . . . . . . . . . . . . . . . . . . . . . . . . 22
Sec. 9.5. TENANT REMEDIES . . . . . . . . . . . . . . . . . . . . . . . . . 23
ARTICLE X: MISCELLANEOUS PROVISIONS . . . . . . . . . . . . . . . . . . . . .. . .23
Sec. 10.1. NOTICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23
Sec. 10.2. WAIVER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24
Sec. 10.3. ENTIRE AGREEMENT AND AMENDMENTS . . . . . . . . . . . . . . . . . .24
Sec. 10.4. NO JOINT VENTURE . . . . . . . . . . . . . . . . . . . . . . . . .24
Sec. 10.6. BROKER'S COMMISSION . . . . . . . . . . . . . . . . . . . . . . . .25
Sec. 10.7. HEADING, CAPTIONS, ETC. . . . . . . . . . . . . . . . . . . . . .25
Sec. 10.8. NO SETOFF . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25
Sec. 10.9. HOLDING OVER . . . . . . . . . . . . . . . . . . . . . . . . . . .25
Sec. 10.10. PLACE OF PERFORMANCE . . . . . . . . . . . . . . . . . . . . . . .25
Sec. 10.11. BUILDING IMPROVEMENTS . . . . . . . . . . . . . . . . . . . . . .25
Sec. 10.12. RIGHT OF FIRST REFUSAL AND OPTION TO EXPAND . . . . . . . . . . .27
Sec. 10.13. COUNTERPARTS . . . . . . . . . . . . . . . . . . . . . . . . . . .28
EXHIBIT "A" PROJECT - LEGAL DESCRIPTION . . . . . . . . . . . . . . . . . . 29
EXHIBIT "B" RULES AND REGULATIONS . . . . . . . . . . . . . . . . . . . . . 30
EXHIBIT "C" OUTLINE AND LOCATION OF PREMISES . . . . . . . . . . . . . . . 34
EXHIBIT "D" TENANT'S CERTIFICATE OF INSURANCE . . . . . . . . . . . . . . . 35
EXHIBIT "E" LANDLORD'S REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . 36
EXHIBIT "F" RENEWAL OPTION . . . . . . . . . . . . . . . . . . . . . . . . 37
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OFFICE LEASE
This LEASE AGREEMENT is entered into August 17, 1995, by DALLAS LYNDON
CORPORATION (hereafter called "Landlord") and NATIONAL TECHTEAM, INC.
(hereafter called "Tenant").
ARTICLE I: DEFINITIONS
SEC. 1.1. LEASED PREMISES Landlord hereby leases to Tenant and Tenant
hereby leases from Landlord approximately 32,666 square feet of rentable
area on the first, second and third (1st, 2nd, and 3rd) floors in that
certain office building (hereinafter called the "Building") in the office
building complex (hereinafter called the "Office Complex") commonly known
as Lyndon Plaza, located at 10945 Estate Lane, Dallas, Dallas County,
Texas (hereinafter the Building and the Office Complex will sometimes be
collectively referred to as the "Project"). The land which constitutes
part of the Project and upon which the improvements, fixtures, equipment
and other items which are defined as the Project is described by metes and
bounds in Exhibit "A" attached hereto and incorporated herein for all
purposes. The area hereby leased in the Building is hereinafter called
"Leased Premises" and is shown outlined and hatched on the floor plan
drawing designated Exhibit "C" which is attached hereto and made a part
hereof and signed or initialed by the parties for identification. The
Leased Premises shall also refer, when applicable, to all other rights in
parking areas, access, common areas and any other rights granted or
accruing to Tenant under this Lease. Landlord shall have the right at any
time and from time to time to change the Project name and address.
The Rentable Area for the entire Project shall be deemed to be 139,666
square feet for the purpose of this Lease. The Rentable Area contained
within the Leased Premises shall be deemed to be the number of square feet
set forth in the preceding paragraph.
SEC. 1.2. LEASE TERM. The phrase "Lease Term" shall mean the primary
term hereafter stated plus any renewal and extension periods which validly
go into effect at the end of such primary term.
SEC. 1.3. LEASE. The term "Lease" shall mean this Lease Agreement
and all amendments hereto hereafter entered into.
ARTICLE II: GRANT OF LEASE
SEC. 2.1. GRANT TO TENANT. In consideration of the mutual covenants
contained in this Lease, Landlord hereby leases to Tenant the Leased
Premises. Landlord and Tenant each acknowledge and agree that
notwithstanding the fact that the Lease Term may commence at a date
subsequent to the execution of this Lease, such parties intend that each
shall have vested rights immediately upon the execution of this Lease and
that this Lease shall be fully binding and in full force and effect from
and after execution hereof.
SEC. 2.2. TITLE AND CONDITION. The Leased Premises are leased
subject to the existing state of the title thereof as of the date of this
Lease; to all zoning regulations,
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restrictions, rules and ordinances, and all building restrictions and
other laws and regulations now in effect or hereafter adopted by any
governmental authority having or acquiring jurisdiction, provided that
Landlord warrants that the rights and uses granted to Tenant hereunder are
not limited thereby; and, as regards the improvements, to their present
state and condition and without representation or warranty of any kind by
Landlord. Landlord does hereby warrant and represent that the Building
contains no asbestos or other toxic or harmful substances and that the
Project conforms, at the date of this Lease, to all applicable asbestos
safety standards and all applicable environmental laws, ordinances,
statutes, rules and regulations of any governmental or regulatory body or
agency.
Tenant shall be responsible for the compliance of the Leased Premises with
all applicable building laws, codes, and regulations including, without
limitation the Americans With Disabilities Act, the Architectural Barriers
Act of the State of Texas, and other similar laws. When the Plans for the
Improvements (as hereinafter defined) are submitted to the appropriate
state and local agencies for approval and issuance of permits, if the
applicable agency makes any requirements with respect to the remainder of
the Building or the Project to bring it into compliance with applicable
laws and regulations as a condition of approval, Landlord shall perform
the work on the Building or Project necessary to obtain and maintain in
full force and effect such approval or permit. The first $5,000.00 of the
cost of such work shall be paid by Landlord, the next $5,000.00 shall be
paid by Tenant, and the balance shall be paid by Landlord.
Landlord further makes the warranties and representations set forth in
Exhibit "E" attached hereto and made a part hereof for all purposes.
SEC. 2.3. COVENANT OF QUIET ENJOYMENT. So long as Tenant complies
fully with all of the provisions of this Lease, Landlord covenants that
Landlord or anyone claiming under Landlord shall not interfere with the
peaceful and quiet occupation and enjoyment of the Leased Premises by
Tenant.
If Landlord fails to comply with this covenant, Tenant may seek
appropriate injunctive relief and damages but Tenant may not, except as
provided in this Lease, terminate this Lease or abate or offset against any
rent or other payments owing to Landlord under this Lease. In the event
Landlord assigns or mortgages Landlord's interest in the Leased Premises,
it is understood and agreed that Landlord may under no circumstances be
held liable for any breach of this covenant of quiet enjoyment occasioned
by acts or omissions of any assignee or successor to the interest of
Landlord if and to the extent such assigns or mortgagees assume the
obligations of Landlord under this Lease.
SEC. 2.4. SERVICES FURNISHED BY LANDLORD. During the Lease Term,
Landlord at its sole cost and expense shall furnish to Tenant in the
Leased Premises and the Building the following services:
A. Central heating and air conditioning to be furnished
twenty-four (24) hours per day, seven (7) days per week (including
all holidays) at such temperatures and in such amounts as are
reasonably considered by Landlord to be sufficient for comfortable
working conditions.
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B. Building standard fluorescent lighting, including
replacement of lamps, ballast's and starters and electric current at
wall and floor outlets; sufficient quantities of running potable
water, public restrooms and all necessary sanitary fixtures and
equipment.
C. Janitor service five (5) days per week; provided, however,
if Tenant's floor covering or other improvements require special
treatment, Tenant shall pay the additional cleaning cost attributable
thereto as additional rent upon presentation of a statement therefore
by Landlord.
D. Routine maintenance and electric lighting service for all
Common Areas and Service Areas of the Building in a reasonably good
manner.
E. Stocking, cleaning, and maintenance of all restrooms
located within the Leased Premises.
F. Access control to the Building during other than Normal
Business Hours shall be provided in such form as Landlord reasonably
deems appropriate. Tenant shall cooperate fully in Landlord's
efforts to maintain access control to the Building and shall follow
all regulations promulgated by Landlord with respect thereto.
Landlord shall use its best efforts to insure complete access to the
Leased Premises by Tenant, its agents, employees and invitees, at all
times to accommodate Tenant's work requirements.
ARTICLE III: TERM
SEC. 3.1. PRIMARY TERM. Partial possession of the Leased Premises by
Tenant will begin on September 1, 1995, or, if later, the date specified
in the contracts approved by Landlord and Tenant for construction of the
improvements to the Leased Premises, for the purpose of allowing Tenant to
install modular furnishings and partitions, opening, move in, setup, and
employee training with initial occupancy for other limited purposes
scheduled for October 1, 1995, or, if later, the date specified in the
contract approved by Landlord and Tenant for construction of the
improvements to the Leased Premises. Tenant shall occupy the Leased
Premises prior to full construction so as not to interfere with or delay
the completion of the construction; such occupancy shall be at Tenant's
risk; and Landlord and the contractor shall have no liability to Tenant or
Tenant's agents, employees, invites, or property for injury or damage
occurring during such occupancy prior to full completion except for
Landlord's or the contractor's gross negligence or willful misconduct.
Subject to Tenant's compliance with all of the provisions of this Lease,
Landlord agrees to lease the Leased Premises to Tenant for a primary term
of five (5) years beginning on the "Commencement Date," which is the
initial occupancy scheduled for October 1, 1995, or, if later, the date
specified in the contracts (as such contracts may be amended) approved by
Landlord and Tenant for construction of the improvements to the Leased
Premises and ending five (5) years after the Commencement Date.
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SEC. 3.2. LEASE RENEWAL. Tenant will have two renewal options for
two (2) years and three (3) years, respectively, each at 95% of current
market rental rate determined in accordance with the terms of Exhibit "F"
attached hereto and incorporated herein.
ARTICLE IV: PAYMENT OBLIGATIONS
SEC. 4.1. BASIC RENT. Tenant agrees to pay monthly as "Basic Rent"
during the Lease Term a rental payment based upon the following schedule
amounts:
Year 1 - $ 3.00/SF = $8,166.50 per month
(months 1 - 5)
Year 1 - $7.75/SF = $21,096.79 per month
(months 6 - 12)
Year 2 - $10.00/SF = $27,221.67 per month
Year 3 - $10.50/SF = $28,582.75 per month
Year 4 - $11.00/SF = $29,943.83 per month
Year 5 - $11.50/SF = $31,304.92 per month
The "Basic Rent" amount shall be payable to Landlord at the address shown
below on the first day of the month without demand, deduction, or offset
except as expressly provided in Section 9.5 hereof.
SEC. 4.2. ADDITIONAL RENT. Other provisions of this Lease require
Tenant, under certain circumstances, to pay additional sums of money to
Landlord or others. For all purposes of this Lease, such sums of money
shall be deemed to be Additional Rent owing by Tenant to Landlord, and in
the event of Tenant's failure to pay such sums when due, Landlord may
exercise all rights, powers and remedies provided herein or by law or
equity or otherwise as in the case of Tenant's failure to pay the Basic
Rent.
SEC. 4.3. LATE CHARGES. Tenant agrees that if the rent (either as
Basic Rent or Additional Rental) is not paid to Landlord on or before the
tenth (10th) day of each month or a check is returned to the Landlord by
the bank for any reason whatsoever, Tenant shall promptly pay the Landlord
the sum of five hundred dollars= ($500.00) as special damages, it being
expressly agreed by the parties hereto that said special damages are
intended to compensate Landlord for the increased administrative expense
incurred as a result of said delay or return.
SEC. 4.4. RENTAL ESCALATION.
A. DEFINITIONS APPLICABLE TO THIS SECTION
1. In the event the Operating Expenses (as defined below) of
Landlord for the Building or the Project, as applicable, shall,
in any calendar year during the term of this Lease, exceed the
amount of Operating Expenses actually incurred for the Base
Year (as hereinafter defined), Tenant agrees to pay as
additional rental
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Tenant's pro rata share of such excess Operating Expenses. Tenant's
pro rata share as of the Commencement Date is agreed to be as follows:
(i) As to the "Building Operating Expenses" (hereinafter defined)
91.493% (based upon the gross total of 35,703 rentable square feet
within the Building) and (ii) As to the "Project Operating Expenses"
(hereinafter defined) 23.388% (based upon the gross total of 139,666
rentable square feet within the Project).
2. The term "Operating Expenses", as such term is defined below,
shall be computed on an annual basis, for the operation of the
Project or Building as specified below during the applicable year of
the Lease Term; the first full calendar year (1996) of the Lease Term
shall be referred to as the "Base Year". All Operating Expenses shall
be determined in accordance with generally accepted accounting
principles which shall be consistently applied. The Operating
Expenses shall include all reasonable and normal costs, expenses, and
disbursements of every kind and nature (except the costs of the
replacement of capital investment items and the other items
hereinafter excluded) in connection with the ownership and operating
of the Project or the Building, as applicable, including, but not
limited to, the following:
(a) Wages and salaries of all employees while engaged in the
maintenance of the Project; employer's social security taxes,
unemployment taxes and insurance, and any other taxes which may
be levied on such wages and salaries; the cost of disability
and hospitalization insurance and pension or retirement
benefits for such employees;
(b) All supplies and materials used in operation and
maintenance of the Project and related equipment;
(c) Cost of water, electricity, natural gas and trash removal
for the Building;
(d) Cost of janitorial services, maintenance and service
agreements on equipment, including alarm service, window
cleaning and elevator maintenance, landscape and parking lot
maintenance related to the Building;
(e) Premiums for casualty and liability insurance applicable
to the Project and Landlord's personal property used in
connection herewith;
(f) All real property taxes and installments of special
assessments, including special assessments due to deed
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restrictions and/or owners' associations, which accrue against
the Project excluding, however, federal and state taxes on
income, and;
(g) Costs of repairs and general maintenance of the Project.
(h) Costs of general and administrative expenses of the
Project, including but not limited to reasonable management
fees not exceeding 5% of Basic Rent.
Those operating Expenses defined above in items 2(c) and 2(d) are
designated as "Building Operating Expenses" and the excess Building
Operating Expenses incurred over the Building Operating Expenses
incurred for the Base Year shall be multiplied by the percentage set
forth in item 1(i) above to determine Tenant's pro rata share thereof.
Those Operating Expenses defined above in items 2(a), 2(b), 2(e),
2(f), 2(g), and 2(h) are designated as "Project Operating Expenses,"
and the excess Project Operating Expenses incurred over those Project
Operating Expenses incurred for the Base Year shall be multiplied by
the percentage set forth in item 1(ii) above to determine Tenant's
pro rata share thereof. Due to the usage and occupancy of Tenant, it
is necessary to subdivide general Operating Expenses and make
separate calculations of each of these divisions. The sum of
Tenant's pro rata share of excess Building Operating Expenses and
Tenant's pro rata share of excess Project Operating Expenses shall be
Tenant's total pro rata share of excess Operating Expenses under the
terms of this Lease.
Anything in the foregoing provisions hereof to the contrary
notwithstanding, Operating Expenses shall not include the following:
(i) Leasing commissions, attorneys' fees; costs,
disbursements, and other expenses incurred in connection
with negotiations for leases with tenants, other
occupants, or prospective tenants or other occupants of
the Project; or similar costs incurred in connection with
disputes with tenants, other occupants, or prospective
tenants or other occupants of the Project.
(ii) Non-cash items, such as deductions for depreciation
or obsolescence of equipment, or interest on capital
invested.
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(iii) Payments of principal and interest or other
finance charges made on any debt and rental payments made
under any ground or underlying lease or leases, except to
the extent that a portion of such payments is expressly
for ad valorem/real estate taxes or insurance premiums
provided above.
(iv) Costs incurred by Landlord in the sale, financing,
refinancing, mortgaging, selling or change of ownership of
the Project, including without limitation brokerage
commissions, attorneys' and accountants' fees, closing
costs, title insurance premiums, transfer taxes and
interest charges.
(v) Costs which are to be capitalized in accordance with
generally accepted accounting principles.
(vi) Costs and expenses attributable to the initial
construction of the Project.
(vii) Any penalty charges incurred by Landlord due to
Landlord's late payment of taxes, utility bills or other
amounts included in the Operating Expenses.
(viii) Allowances and other costs and expenses incurred
in fixturing, furnishing, renovating or otherwise
improving, decorating or redecorating space for tenants or
prospective tenants of the Project or vacant leasable
space (including permit, license and inspection costs but
excluding normal maintenance, repair and replacement
costs).
(ix) Cost of any political or charitable donations or
contributions.
(x) Any expenses directly or otherwise paid by Tenant.
B. PAYMENT OF RENTAL ESCALATION.
1. At the end of each year during the Lease Term commencing in
1997, Landlord shall, within ninety (90) days after the end of such
year (or calendar year, as determined by Landlord in its discretion)
for which rental escalation is due, give written notice thereof to
Tenant which notice shall also contain or be accompanied by a
computation of such rental escalation. (It is understood that there
shall be no payment by Tenant for excess
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Operating Expenses or the estimated rental escalation for Lease
on calendar years 1995 and 1996 due to the Base Year
determination.)
2. Tenant shall pay, without further notice or demand, such
rental escalation to Landlord within thirty (30) days after
receipt of the written notice described in the preceding
paragraph.
3. At Landlord's option, Tenant shall pay, as Additional Rent
beginning in calendar year 1998, the estimated rental
escalation for the current year of the Lease Term. The amount
of estimated rental escalation shall be determined by Landlord
based on the amount of Operating Expenses for prior years.
Landlord shall notify Tenant of the amount of such estimated
escalation at the beginning of each year during the Lease Term,
and Tenant shall pay one-twelfth (1/12) of the amount of such
estimate each month simultaneously with Tenant's payment of
Basic Rent.
4. Within ninety (90) days after the end of each calendar
year during the Lease Term beginning December 31, 1997,
Landlord shall render an accounting to Tenant with regard to
the estimated rental escalation referred to in paragraph 3
above. If the actual excess Operating Expenses for any such
year or partial year, as applicable, are greater than
Landlord's estimate described herein, then Tenant shall pay
that excess to Landlord as stated herein. Likewise, if the
actual excess Operating Expenses are less than Landlord's
estimate, then the difference shall be applied to the next
succeeding payments of Basic Rent and Additional Rent payable
by Tenant hereunder or, if the Lease Term has expired, refunded
to Tenant. If additional monies are due by Landlord or Tenant,
such monies shall be paid within thirty (30) days after
Landlord renders such accounting to Tenant. Tenant, at its
sole cost and expense, shall have the right (to be exercised by
giving notice to Landlord within sixty (60) days after receipt
of the statement of excess Operating Expenses for such previous
calendar year or lease year) to audit and/or inspect Landlord's
books and records pertaining to items affecting excess
Operating Expenses for such preceding calendar year. If the
audit discloses any discrepancy then the same shall be
reconciled as soon as possible. If the audit reveals that
Tenant paid more than 105% of its proportionate share of the
actual excess Operating Expenses during the year in question,
Landlord shall immediately pay to Tenant the cost of Tenant's
audit.
SEC. 4.5. PAYMENT OF RENT. All sums payable by Tenant to Landlord as
rent (either as Basic Rent or as Additional Rent) shall be made by check
or draft payable to the order of Landlord. Landlord may change the party
to the order of whom any such checks or drafts are to be made payable, or
the address to which such checks or drafts are to be mailed, by
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giving written notice to such effect to Tenant at least ten (10) days
prior to the effective date of such change. If any check or draft
delivered to Landlord is not honored or paid when presented for payment
for any reason other than negligence or fault of Landlord or other proper
payee, Landlord may thereafter require all such future payments of Tenant
to be made by cash, cashier's check, or United States postal money order.
SEC. 4.6. SECURITY DEPOSIT. There will be no security deposit paid
by Tenant.
SEC. 4.7. TAXES. Parties other than Tenant shall pay as they become
due all taxes, charges, levies, and assessments at any time levied or
assessed against the Project by any governmental taxing authority. During
the Lease Term, Tenant shall pay as they become due all taxes, charges,
levies, and assessments levied or assessed by any governmental authority
against any leasehold interest or personal property of Tenant placed in,
on, or about the Leased Premises by Tenant, and Tenant shall further pay
as they become due all taxes, charges, assessments, and levies (including
without limitation franchise, sales, excise and use taxes) in any way
stemming from or connected with Tenant's business operations upon the
Leased Premises.
SEC. 4.8. INSURANCE; INDEMNIFICATION
A. LIABILITY INSURANCE. During the Lease Term, Tenant shall,
at Tenant's sole expense, carry and maintain public liability
insurance covering the Leased Premises and the business operations
conducted upon the Leased Premises (including business operations
conducted by Tenant's licensees, concessionaires, and, permitted
sublessees) providing coverage in the minimum amount of $1,000,000.00
against liability for injury to or the death of any one person,
$1,000,000.00 against liability arising out of any one accident or
occurrence, and property damage insurance in the minimum amount
required to provide coverage for Tenant's property which is
maintained on the Leased Premises. Such insurance shall be written
with insurance companies authorized to do business in the State of
Texas and acceptable to Landlord, shall include Tenant as insured and
Landlord as an Additional Insured; and shall contain a clause that
the insurer will not cancel or change such insurance without first
giving Landlord a minimum of thirty (30) days' prior written notice.
Tenant shall furnish Landlord with copies of the policies or
certificates evidencing that such insurance is in full force and
effect and stating the terms thereof.
B. CASUALTY INSURANCE. Landlord shall provide fire and
extended coverage insurance policies (in such amounts as are
customary under the circumstances but no less than 80% of the
replacement value) covering the Project including, without
limitation, the Leased Premises, the Improvements, fixtures and
equipment installed by Landlord and all common areas and parking
areas. Tenant shall provide fire and extended coverage insurance
policies (in such amounts a shall equal the replacement value
thereof) covering all of Tenant's property which is located in, on,
or about the Leased Premises.
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C. INCREASED INSURANCE PREMIUMS. Tenant shall not use or
offer products for sale at or from the Leased Premises or engage in
activities which may be prohibited by the then approved Texas
Standard Form of Fire Insurance Policy or which would result in
increased premiums for any of Landlord's insurance policies covering
the Project or the Leased Premises.
D. WAIVER OF SUBROGATION. Notwithstanding any other
provision in this lease, neither Landlord nor Tenant shall be liable
to the other or to any insurance company (by way of subrogation or
otherwise) insuring the other party for any loss or damage to the
Leased Premises, the Building, the Project, or any tangible personal
property, even though such loss or damage might have been occasioned
by the negligence of Landlord or Tenant, its agents, officers,
directors, shareholders, employees, or invitees. Landlord and Tenant
agree immediately to give their respective insurance companies which
have issued policies of insurance covering risk of physical loss,
written notice of the terms of the mutual waivers contained in this
section, and to have the insurance policies properly endorsed, if
necessary, to prevent the invalidation of the insurance coverages by
reason of such mutual waivers.
E. INDEMNITY AND EXCULPATORY CLAUSE. Except as stated in the
preceding paragraph D and except as otherwise specifically provided
herein, Tenant shall indemnify, hold harmless, and defend Landlord
against and from all claims, actions, damages, liability, and
expense, including, but not limited to, reasonable attorneys' and
other professional fees, in connection with injury to persons or
damage to property arising from or related to the occupancy or use of
the Leased Premises or any other part of the Project by Tenant caused
in whole or in part by any act or omission of Tenant, its officers,
agents, contractors, employees, or invitees.
Except as stated in the preceding paragraph D and except as otherwise
specifically provided herein, Landlord agrees to indemnify hold
harmless, and defend Tenant against and from all claims, actions,
damages, liability, and expense, including, but not limited to,
reasonable attorneys' and other professional fees, in connection with
injury to persons or damage to property occurring upon any part of
the Project caused in whole or in part by any act or omission of
Landlord, its officers, agents, contractors, or employees.
Landlord shall not be liable to Tenant or to anyone claiming by,
through, or under Tenant, for any injury or damage caused by the acts
or omissions of persons occupying portions of the Project other than
the Leased Premises.
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ARTICLE V: USE AND MAINTENANCE OBLIGATIONS
SEC. 5.1. USE OF LEASED PREMISES.
A. DESCRIPTION OF PERMITTED USE. The Leased Premises are leased
by Landlord to Tenant, and Tenant shall use the Leased Premises, only for
the following purposes:
General office and computer training use and service call center and
all other related uses only
and for no other purposes whatsoever. Tenant hereby accepts the Leased
Premises and the Project as completely suitable for such purposes. Tenant
shall not commit any act on or near the Leased Premises or the Project
which constitutes a nuisance nor otherwise allow any nuisance to exist
thereon.
B. USE IN COMPLIANCE WITH LAWS. Tenant shall, at Tenant's own
expense, comply with all applicable laws, ordinances, rules, requirements,
and regulations of all duly constituted public or semi-public authorities
relating to the operation of Tenant's business or the conduct of Tenant's
visitors, licensees, agents, and employees now or hereafter in any manner
affecting the Leased Premises or the Project whether or not any such laws,
ordinances, rules, requirements, and regulations which may be hereafter
enacted involve a change of policy on the part of the enacting authority
which are applicable solely because of Tenant's use of the Leased Premises
beyond the uses described above. Tenant shall not: (1) permit or
knowingly allow any unlawful or immoral practice to be carried on or
committed on the Leased Premises or the Project by Tenant's employees,
agents, officers, directors and invitees; (2) make any use of or allow the
Leased Premises or the Project to be used for any purposes that might
invalidate or increase the rate of insurance thereof; (3) keep or use or
permit to be kept or used on the Leased Premises or the Project any
inflammable fluids; (4) use the Leased Premises or the Project for any
purpose whatsoever which might create a nuisance or injure the reputation
of the Leased Premises or the Project; (5) deface or injure any
improvements located on the Leased Premises or the building; (6) overload
the floors; nor (7) commit or suffer any waste. Tenant agrees to pay as
additional rent any increases in the cost of insurance on the Leased
Premises or the Building to Landlord as a result of any unauthorized use
of the Leased Premises or the Building by Tenant, but such payment shall
not constitute in any manner a waiver by Landlord of Landlord's right to
enforce all of the provisions of this Lease. Tenant shall indemnify
Landlord for any liabilities, loss, cost, and expense (including court
costs and reasonable attorneys' fees) incurred by Landlord as a result of
Tenant's violation of the provisions contained in this paragraph.
Landlord acknowledges that the use by Tenant described in this Lease does
not and shall not cause any liability for Tenant under this Section 5.1.B.
Tenant may, at Tenant's own expense, contest the validity of any law,
ordinance, rule, requirement or regulation of the nature herein referred
to. If by the terms of any such law, ordinance, rule, requirement or
regulation,
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compliance therewith may be legally held in abeyance without incurring any
lien, charge, or liability of any kind against the fee or leasehold
interest in and to the Leased Premises or the Building and without
subjecting Tenant or Landlord to any liability for failure so to comply,
Tenant may postpone compliance therewith until a final determination in
any such proceedings, but only if all such proceedings are prosecuted by
Tenant with all due diligence and dispatch and at the sole cost, expense,
and risk of Tenant.
C. TENANT'S USE. Landlord accepts Tenant's permitted use as
described herein as an acceptable use and as not being in violation of
Section 5.1 A. and B. above.
SEC. 5.2. MAINTENANCE OF LEASED PREMISES.
A. MAINTENANCE BY LANDLORD. Landlord shall, at Landlord's sole
expense, make all repairs and replacements which may be necessary to
maintain in good condition (1) the roof, foundation, structural walls,
exterior glass windows, common areas, parking areas and Landlord's related
fixtures and improvements located at the Project; (2) all air conditioning
and heating equipment (including replacement of air conditioning filters)
and plumbing fixtures, and (3) all electrical wiring installed as part of
the Improvements, except for repairs required by Tenant's using equipment
which requires electricity in excess of the capacity of the installed
wiring, and not including any cabling or wiring installed by Tenant to
serve Tenant's communications or computer equipment. Landlord shall not
be liable to Tenant for any damage resulting from failure to make said
repairs unless, prior to the occurrence of such damages, Tenant has given
Landlord written notice of the defect and Landlord does not, within ten
(10) days thereafter, commence such repairs and continue the repairs to
completion without unreasonable delays. However, Landlord may not be
required to provide any such maintenance, repairs, or replacements which
become necessary as a result of any negligence of Tenant (or Tenant's
employees, agents or invitees) except as described in this Lease unless
such damage is covered by a standard fire and extended insurance policy.
If, as a result of the making of any such repairs or replacements, other
than those caused by Tenant (or Tenant's employees, agents or invitees),
Tenant is deprived of the use of a significant portion of the Leased
Premises for a significant period of time, or Tenant's business is
interrupted for a substantial period of time, the rent payable by Tenant
to Landlord shall be equitably reduced for such period in an amount as
determined by Landlord in its reasonable discretion.
B. ACCESS BY LANDLORD. Tenant agrees to allow Landlord and
Landlord's agents, employees and representatives to enter into and upon
the Leased Premises during normal business hours or otherwise for the
purpose of inspecting the Leased Premises and carrying out Landlord's
maintenance obligations. Landlord shall take due care to protect Tenant's
privacy and the confidentiality of any information within the Leased
Premises. In carrying out Landlord's maintenance obligations, Landlord
may use and temporarily store on
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the Leased Premises all necessary materials, tools and equipment subject
to the reduced rental provisions in Section 5.2 above. Landlord may under
no circumstances be held liable for inconvenience, annoyance, disturbance
or loss of business caused to Tenant or Tenant's guests, business invitees,
employees or sublessees by the carrying out of Landlord's maintenance
obligations.
C. MAINTENANCE BY TENANT. Except for any construction to be
completed by Landlord pursuant to the terms of this Lease, Tenant agrees
to accept possession of the Leased Premises in their present condition and
to allow for such changes in condition as may normally be expected to
occur through reasonable deterioration between the date of this Lease and
the date Tenant actually takes possession of the Leased Premises.
Landlord warrants that the Leased Premises and any improvements thereto
and/or any of Landlord's equipment therein will be in good condition and
working order as of the Commencement Date. Tenant shall, at Tenant's sole
expense, make all repairs and replacements which may be necessary to
maintain in good condition the Leased Premises other than those repairs,
replacements, and maintenance which are required by this Lease to be made
by Landlord. If Tenant fails to make the repairs or replacements required
by this Lease, Landlord is authorized by this Lease to complete such
repairs and replacements on behalf of Tenant, and to be reimbursed for the
reasonable and customary expenses incurred thereby multiplied by one
hundred five percent (105%), with said sum, at Landlord's sole option, to
be collectible as Additional Rent, and in such event Landlord may under no
circumstances be held liable to Tenant for any damages that Tenant might
suffer as a result of such action on the part of Landlord. Upon the
termination of this Lease, Tenant shall surrender the Leased Premises to
Landlord in good order and repair, reasonable wear and tear excepted.
Except as otherwise provided in this Lease, Tenant shall be liable at the
time of termination of this Lease for all repairs and replacements which
have become necessary as a result of any act of negligence of Tenant (or
Tenant's employees, agents, or invitees).
D. ALTERATIONS. Tenant shall not make any structural alterations,
additions, or changes to Landlord's lock system, or other changes to the
Leased Premises without Landlord's prior written consent which consent
shall not be unreasonably withheld. Tenant may make non-structural
alterations to the interior of the improvements constituting part of the
Leased Premises without Landlord's prior written consent, but only if: (1)
such alterations are accomplished in a good and workmanlike manner at
Tenant's sole expense and in accordance with all applicable federal, state
and local laws, regulations, ordinances and other promulgations; and (2)
such alterations shall not adversely affect the structural strength or
market value of the improvements. Title to such alterations (excluding
trade fixtures which, except as provided otherwise herein, shall remain
the property of Tenant but which shall be removed at the end of the Lease
Term without damage to the Leased Premises) shall immediately vest in
Landlord at the end of the final day of the Lease Term and shall remain as
part of the Leased Premises. However, Landlord may elect to have Tenant
remove
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any or all of such alterations in which event such alterations shall be
completely removed by Tenant (without damage to the Leased Premises) by
the end of the Lease Term. Tenant shall promptly pay for all work done or
materials furnished in connection with the making of any such alterations,
additions, or other changes to the Leased Premises, and under no
circumstances may any of Tenant's suppliers of work or materials obtain
any lien or other claim to Landlord's or Tenant's interest in the Leased
Premises or the Project. Landlord's consent to the making of such
alterations, additions, or other changes shall not be construed to make
Tenant an agent of Landlord with authority to subject Landlord's interest
in the Leased Premises to any such lien or other claim. If Tenant shall
desire to challenge the amount of the claim or charges of any such
supplier or work or material, Tenant shall provide, at Tenant's sole cost
and expense, reasonable assurance of payment or release of said claim
reasonably satisfactory to Landlord.
SEC. 5.3. SIGNS
A. Landlord will furnish and install a suitable building directory
and establish suite numbers to facilitate locating and identifying
Tenant's premises. In order to effect uniformity, to control the
graphics, and to maintain dignified aesthetics, Landlord will also furnish
and install at the entrance door to the Leased Premises one uniform suite
number plate and name plate. Signs, name plates or graphics which are
wholly within the Leased Premises and not visible from the exterior of the
Building or from public spaces within the Building will be permitted, to
the extent that neither the structure nor the market value of the Leased
Premises or the Building will be affected thereby.
B. Tenant, at Tenant's sole expense, shall have the right to
install a sign which is acceptable to Landlord in its reasonable
discretion identifying Tenant on the exterior parapet of the Building.
Tenant agrees that no other sign of any description shall be erected or
painted in or about the Leased Premises or the Project unless previously
approved in writing by Landlord. Tenant shall, at Tenant's expense,
remove all signs at the termination of this Lease, and the installation
and removal shall be in such manner as to avoid any injury, defacement or
overloading of the Building or other improvements.
ARTICLE VI: SPECIAL PROVISIONS
SEC. 6.1. ASSIGNMENTS AND SUBLEASES.
A. BY TENANT. Tenant may assign or sublet all or any part of
the Leased Premises with prior notice to Landlord pursuant to a
transfer of a majority interest in outstanding shares of stock of
Tenant or the merger or dissolution of Tenant, or to a subsidiary of
Tenant or the holder of the majority of the outstanding shares of stock
of Tenant. Otherwise, Tenant shall not assign this Lease nor sublease
any part or all of the Leased Premises without Landlord's prior written
consent which consent shall not be unreasonably withheld. Consent
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by Landlord to one assignment or sublease shall not be construed as
meaning consent to further assignments or subleases. Regardless of any
such assignment or sublease, Tenant shall remain liable to Landlord for
the full performance of all of the provisions of this Lease. Any
attempted unpermitted sublease or assignment shall, at Landlord's
election, be null and void and without any binding effect.
B. BY LANDLORD. Landlord may at any time convey, assign, or
encumber the Leased Premises, the Project and/or Landlord's rights under
this Lease. In the event of any such conveyance or assignment (other than
a conveyance or assignment as collateral security for an indebtedness),
Landlord shall be completely relieved from all obligations placed on
Landlord by this Lease, including, without limitation, the return of any
security deposits, effective the date of such conveyance or assignment but
only to the extent that any assignee or mortgagee assumes the obligations
of Landlord under this Lease.
SEC. 6.2. FORCE MAJEURE. In the event that Landlord or Tenant shall be
delayed or hindered in or prevented from the performance of any of their
respective obligations anywhere herein contained by reason of: (1) the
destruction, in whole or in part, of any improvements forming a part of the
Leased Premises; (2) strikes; (3) lockouts; (4) labor troubles; (5) war,
whether declared or undeclared; (6) riot; (7) Act of God; (8) embargoes; (9)
delays in transportation; (10) inability to procure materials and/or labor;
(11) failure of power; (12) restrictive governmental laws or regulations,
whether valid or not; (13) insurrection; or (14) any other reason (other than
financial) beyond the reasonable control of such party, and not the fault of
the party so delayed or hindered in or prevented from performing work or doing
acts otherwise required under this Lease, then performance of such work or
doing of such acts shall be excused for the period of the delay, and the period
for the performance of such work or doing such acts shall be extended for a
period equivalent to the period of such delay; provided, however, that the
provisions of this Section shall not operate so as to excuse or release Tenant
from the prompt payment of rentals or other sums required to be paid by Tenant
to Landlord or to other payees anywhere hereunder.
SEC. 6.3. ESTOPPEL CERTIFICATE. Within ten (10) days after written
request therefor by Landlord (in connection with a proposed conveyance or
encumbering of the Building by Landlord) Tenant shall deliver to Landlord (or
Landlord's nominee) in recordable form an Estoppel Certificate certifying (if
such be the case) that this Lease is unmodified and in full force and effect
and the dates to which the Basic Rent, Additional Rent, and other charges have
been paid, and stating whether or not to the knowledge of the signer of such
certificate Landlord is in default in the performance of any provision
contained in this Lease, and, if so, specifying each such default of which the
signer may have knowledge, and any other matters which Landlord may request.
Tenant shall not be required to deliver more than two (2) estoppel certificates
in any year of the Lease Term. Thereafter, for each request Landlord shall
prepay Tenant $500 to cover some of the administrative expense incurred by
Tenant in supplying such Estoppel Certificates. If Tenant, for any reason,
fails to do so upon request, if Landlord gives Tenant written notice of such
failure and such failure continues for an additional ten (10) days after such
notice, Tenant hereby irrevocably appoints Landlord as Tenant's
attorney-in-fact for the sole and limited purpose of executing such Estoppel
Certificate on behalf of Tenant with full
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power and authority to execute, acknowledge, and deliver any such Estoppel
Certificate in the name of and on behalf of Tenant.
SEC. 6.4. SUBORDINATION OF LEASE. If Landlord is required by the holder
of any note secured by a mortgage, deed of trust, or other lien now or
hereafter given by Landlord covering the Leased Premises to subordinate this
Lease to such mortgage, deed of trust, or other lien (and to all advances
hereafter made in connection therewith), Tenant shall, after ten (10) days'
written request therefor, execute and deliver such instruments as Landlord
determines may be necessary to effect such subordination on the condition that
Landlord's mortgagee (i) recognizes this Lease, and (ii) agrees that all
rights of Tenant under this Lease shall remain in full force and effect
notwithstanding any subordination thereof to such mortgagee's lien, and that
Tenant may continue its occupancy of the Leased Premises in accordance of the
terms and the provisions of this Lease, so long as Tenant continues to pay rent
and otherwise performs its obligations under this Lease, and (iii) covenants
that it will not disturb Tenant's right of possession during the term of the
Lease or any renewal or extension thereof provided for herein so long as Tenant
is not in default under any of the terms, covenants or conditions of this
Lease. Landlord hereby represents to Tenant that there is no item of current
mortgage, deed of trust lien or other similar financing agreement other than
those for which Landlord shall have obtained a Non-Disturbance Letter pursuant
hereto, which prohibits or restricts in any manner Tenant's use and enjoyment
of the Leased Premises pursuant to the terms and conditions of this Lease. If
Tenant, for any reason, fails to do so upon request, if Landlord gives Tenant
written notice of such failure and such failure continues for an additional ten
(10) days after such notice, Tenant hereby irrevocably appoints Landlord as
Tenant's attorney-in-fact for the sole and limited purpose of executing such
subordination instrument on behalf of Tenant with full power and authority to
execute, acknowledge, and deliver any such instrument in the name of and on
behalf of Tenant on the condition that such instrument contains items (i), (ii),
and (iii) in this Section.
Landlord will use all reasonable efforts to obtain a non-disturbance and
attornment agreement from the holders of all existing liens on the Building
containing items (i), (ii), and (iii) in this Section.
SEC. 6.5 LANDLORD'S LIEN. In order to secure Tenant's payment of rent and
other payment obligations under this Lease, in addition to Landlord's statutory
landlord's lien, Tenant hereby grants to Landlord a contractual security
interest, pursuant to the Uniform Commercial Code of the State of Texas, in
all tangible personal property of the Tenant now or hereafter located in the
Leased Premises (the "Collateral"). Upon an Event of Default (as hereinafter
defined) by Tenant, Landlord may take possession of the Collateral, and may
sell all or part of the Collateral at a public or private sale, in one or more
sales, with or without notice, to the highest bidder for cash, and, on behalf
of Tenant, convey the Collateral to the highest bidder. The proceeds of the
sale of the Collateral shall be applied by Landlord toward the reasonable
costs and expenses of the sale, including but not limited to reasonable
attorney's fees, and then toward the payment of all sums then due by Tenant to
Landlord under the terms of this Lease. Any excess remaining shall be paid to
Tenant or any other person entitled thereto by law.
Landlord, in addition to the rights prescribed in the preceding paragraph,
shall have all the rights granted a secured party under the Uniform Commercial
Code. Tenant will, on request, execute and deliver to Landlord a financing
statement for the purpose of perfecting Landlord's
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contractual security interest under this Lease, or Landlord may file this Lease
or a copy thereof as a financing statement. Landlord and Tenant agree that any
requirement for reasonable notice shall be met if such notice is given by ten
(10) days written notice, certified mail, return receipt requested to Tenant at
Tenant's address hereinafter specified.
If any of Tenant's equipment is leased from or financed by an unrelated
third-party institution, Landlord agrees to subordinate Landlord's liens and
security interests in such equipment to the rights of such financial
institution. Within ten (10) days' after written request therefor, Landlord
shall execute and deliver such instruments as the party providing such leasing
or financing reasonably requires to effect such subordination. If Landlord,
for any reason, fails to do so upon request, if Tenant gives Landlord written
notice of such failure and such failure continues for an additional ten (10)
days after such notice, Landlord hereby irrevocably appoints Tenant as
Landlord's attorney-in-fact for the sole and limited purpose of executing such
instruments on behalf of Landlord with full power and authority to execute,
acknowledge, and deliver any such instruments in the name of and on behalf of
Landlord.
Tenant has advised Landlord that Tenant may purchase equipment for the benefit
of Tenant's customers using the customers' funds for such purpose, that such
equipment is the property of such customers, and that, upon termination of the
contracts with such customers, such equipment is to be delivered to such
customers. Landlord agrees that any such equipment shall not be subject to
Landlord's liens or security interests.
SEC. 6.6. PARKING FOR TENANT. Landlord shall provide a minimum of two
hundred (200) uncovered parking spaces adjacent to the Building in addition to
fifteen (15) parking spaces in the parking garage reserved for the exclusive
use of the Tenant. Tenant and Tenant's employees, agents, and invitees shall
park their cars only in areas specifically designated by Landlord from time to
time. Upon written request by the Landlord, Tenant shall furnish to Landlord
within ten (10) days of such request the automobile license numbers assigned to
Tenant's cars and the cars of all of Tenant's employees and agents.
Notwithstanding anything else stated in this Lease, in the event that any
portion of the parking spaces to be provided to Tenant hereunder or access
thereto is taken by eminent domain or purchase in lieu thereof or any other
reason, then Landlord shall replace either the parking places on other land on
the Project by re-striping the number of parking spaces so taken or lost.
Should Landlord be unable to restore the parking spaces as stated above and
this Lease is not terminated by any other provision contained herein, then
Tenant may terminate this Lease at its option if it shall provide written
notice thereof to Landlord on or before sixty (60) days from its receipt by
Tenant of Landlord's notice of inability to so restore.
SEC. 6.7. RULES OF PROJECT. Tenant agrees to comply with all rules and
regulations currently or hereafter established by Landlord for the operation of
the Project of which the Leased Premises are a part. A copy of any current
Rules and Regulations is attached as Exhibit "B" and incorporated herein by
reference. Landlord agrees to enforce the same Rules and Regulations equally
with regard to all tenants of the Project.
ARTICLE VII: DAMAGE AND CONDEMNATION
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Sec. 7.1. DAMAGE TO LEASED PREMISES.
A. SUBSTANTIAL DAMAGE. If the improvements constituting part of the
Leased Premises are damaged by fire or other casualty to the extent of fifty
percent (50%) or more of their replacement cost, as determined by either party
in its sole and reasonable discretion, then either Tenant or Landlord may
elect, by written notice delivered to the other no later than ninety (90) days
after such damage to terminate this Lease. In such event, no rent shall be owing
by Tenant to Landlord for the period beginning on the day of such damage,
unless Tenant shall have continued or have been able to continue to occupy the
Leased Premises during said period, in which case, the reduced amount of rent
shall be owing until the date of said termination.
B. PARTIAL DAMAGE. If the improvements constituting part of the Leased
Premises are damaged by fire or other casualty to the extent of less than fifty
percent (50%) of their replacement cost (or if such damage is greater but both
parties fail to exercise the election given in paragraph A above), then
Landlord shall proceed with due diligence to restore such improvements to
substantially their previous condition and shall deliver possession of such
improvements to Tenant as soon as such restoration has been completed. Should
Landlord elect to repair or restore, the rental hereunder shall be adjusted in
proportion to the amount of floor space which Tenant cannot use, as determined
by Landlord, until such repairs are substantially complete and all permits and
certificates necessary for Tenant's occupancy of the entire Leased Premises are
issued. If such damage has been so slight that Tenant's occupancy of the
Leased Premises is not significantly interfered with, the rental hereunder
shall continue to be paid as herein provided. Notwithstanding the foregoing
provisions of these Sections 7.1.A. and B., Tenant agrees that if the Leased
Premises or any other portion of the Project is damaged by fire or other
casualty resulting from the fault or negligence of Tenant or any of its agents,
employees or invitees, then the damage shall be repaired at the sole cost and
expense of Landlord's insurer, except that Tenant shall pay any deductible not
exceeding $5,000.00, and there shall be no adjustment of rent before or during
the repair of such damage or during the remainder of the Lease Term in the
event said damage is not repaired.
SEC. 7.2. CONDEMNATION OF LEASED PREMISES.
A. TOTAL CONDEMNATION. If all of the Leased Premises are taken under
any eminent domain proceedings, this Lease shall terminate on the date title to
the Leased Premises vests in the condemning authority. There shall be refunded
to Tenant any portion of prepaid rent covering the period subsequent to such
date of termination. Tenant shall not be entitled to any of the condemnation
award other than the amount, if any, equal to the value of Tenant's leasehold
estate which is awarded to Tenant by the condemning authority for the value of
said leasehold estate, moving cost and the value of Tenant's improvements to
the Leased Premises.
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B. PARTIAL CONDEMNATION. If twenty percent (20%) or less of the
Leased Premises is taken under any eminent domain proceeding, Landlord and
Tenant shall each receive such portion of the condemnation award as may be
expressly allocated to such party; but if there be no such separate award,
then the condemnation award shall be fairly and equitably apportioned
between Landlord and Tenant in accordance with the damage caused to said
parties' interest in the Leased Premises as a result of such taking. If
more than twenty percent (20%) of the Leased Premises (but less than all
of the Leased Premises) is taken under any eminent domain proceeding,
Tenant shall, within sixty (60) days after Tenant first receives notice of
the condemnation, elect (by written notice delivered to Landlord) either
to terminate this Lease on the date title to the Leased Premises vests in
the condemning authority, or continue this lease as to that portion of the
Leased Premises not taken by the condemning authority. If Tenant fails to
elect within the thirty-day period, this Lease shall automatically be
continued in full force and effect as to that portion of the Leased
Premises not taken by the condemning authority. In the event Tenant
elects to terminate this Lease, then there shall be paid to Tenant a
portion of any prepaid rent and a portion of the condemnation award in the
same manner as provided above in the event of a total condemnation. In
the event this Lease is continued, the Basic Rent payable by Tenant to
Landlord shall be reduced by an amount determined by taking the ratio
which the number of square feet of the Leased Premises actually taken by
the condemning authority bears to the total number of square feet of the
Leased Premises originally contained in the Leased Premises and
multiplying said ratio by the amount of Basic Rent.
ARTICLE VIII: DEFAULT
SEC. 8.1. EVENTS OF DEFAULT. An "Event of Default" will be deemed to
have occurred upon the happening of any of the events or conditions designated
herein, or any one of the following events or conditions:
A. Tenant abandons the Leased Premises or allows them to remain
unoccupied for a continuous period of twenty (20) days and fails to pay
rent and any increased insurance premiums resulting from such vacancy.
B. Any Basic rent or Additional Rent remains unpaid ten (10) days
after written notice of such fact forwarded to Tenant; provided, however,
in no event shall Landlord be required to give said notice and additional
ten (10) days more than two (2) times per calendar year for the failure to
pay said rent on the date it is due and payable to constitute an Event of
Default;
C. Tenant makes an assignment for the benefit of creditors,
becomes insolvent, commits an act of bankruptcy, files for bankruptcy, or
involuntary bankruptcy proceedings are instituted or threatened against
Tenant or any guarantor of Tenant's obligations hereunder; or Tenant's
leasehold estate in the
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Leased Premises or Tenant's assets are attached or otherwise levied upon
or placed in the hands of a receiver or other representative of a court; or
D. Tenant fails to comply fully with all of the provisions of this
Lease or the Rules and Regulations, currently or hereafter promulgated by
Landlord, to be observed by Tenant; Landlord gives Tenant written notice
of such failure; and Tenant fails to cure such failure within thirty (30)
days thereafter (unless such cure cannot be accomplished within such
thirty-day period in which event Tenant shall have not more than an
additional ninety (90) days to cure such failure if Tenant commences such
curative action within such thirty (30) day period and diligently pursues
such curative action to completion.
SEC. 8.2. DEFAULT BY LANDLORD. The following shall be deemed to be events
of default by Landlord under this Lease: (i) Landlord shall fail to comply with
any material term, provision or covenant of this Lease, and the failure is not
cured within thirty (30) days after written notice to Landlord; provided,
however, no such default shall exist if, within such thirty (30) day period,
Landlord commences the required action and continues to pursue such action
diligently and without interruption thereafter, but the failure must be cured
within ninety (90) days after such written notice to Landlord.
ARTICLE IX: REMEDIES
Upon the occurrence of any Event of Default by Tenant, Landlord shall have the
option to do any one or more of the following without any notice or demand, in
addition to and not in limitation of any other remedy permitted by law or by
this Lease.
SEC. 9.1. LANDLORD'S RIGHT TO CURE DEFAULT. Upon the occurrence of an
Event of Default, and at any time thereafter during the continuance of any
Event of Default, Landlord may, but shall not be obligated to (without any
requirement of giving notice to Tenant), take whatever steps may be necessary
to cure any and all such Events of Default and, in order to accomplish this
purpose, may enter upon the Leased Premises without being liable to prosecution
or any claim for damages therefor except those caused by the gross negligence
or willful misconduct of Landlord, its agents, employees, representatives,
contractors, subcontractors and consultants. Such action on Landlord's part
may in no event be construed as a waiver by Landlord of any of Tenant's
obligations under this Lease. All sums expended by Landlord in curing any and
all such Events of Default (including reasonable attorney's fees and related
legal costs), together with interest thereon at the maximum lawful rate per
annum (unless there is no maximum rate of interest provided by law with respect
to such amount, in which event such amount shall bear interest at the rate of
1-1/2% per month) from the date of the making of any such expenditure to the
date of repayment thereof to Landlord, shall be deemed Additional Rent and
shall be payable to Landlord ten (10) days after written demand therefor given
the Tenant, and the failure to do so shall constitute an Event of Default.
SEC. 9.2. LANDLORD'S RIGHT TO RE-ENTER. Upon the occurrence of an Event
of Default, and at any time thereafter during the continuance of any Event of
Default, Landlord may (without any requirement of giving notice to Tenant)
re-enter and repossess the Leased
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Premises, by picking or changing locks if necessary, remove therefrom Tenant
and all those claiming under Tenant, and remove and store in public warehouses
or elsewhere at Tenant's expense all property found in or upon the Leased
Premises. Landlord may accomplish all this without resort to legal process and
without being deemed guilty of trespass or becoming liable to Tenant or others
for any resulting loss or damage, and without terminating this Lease (unless
expressly provided otherwise herein) or otherwise affecting the obligations of
the Tenant for the unexpired term of this Lease, including without limitation,
liability for unaccrued rent.
SEC. 9.3. LANDLORD'S ELECTION TO TERMINATE OR RELET. Upon the occurrence
of an Event of Default, whether or not Landlord re-enters the Leased Premises
as above provided, Landlord may:
A. Terminate this Lease by giving Tenant written notice to such
effect in which event all of Tenant's rights under this Lease shall cease,
in which event Tenant shall immediately surrender the Leased Premises to
Landlord, but if Tenant shall fail so to do, Landlord may without notice
and without prejudice to any other remedy Landlord may have for possession
or arrearage in rent, enter upon and take possession of the Leased
Premises and expel or remove Tenant and its property and other effects
without being liable to prosecution or any claim for damages therefor and
Tenant agrees to indemnify Landlord for all loss and damage which Landlord
may suffer by reason of such termination whether through inability to
relet the Premises or otherwise, and to pay the aforementioned accelerated
rental amounts to Landlord on demand. Tenant shall, within ten (10) days
after the receipt of such aforementioned written notice, pay to Landlord
as liquidated damages a sum of money equal to the Basic Rent plus the
Additional Rent for the balance of the Lease Term less the fair rental
value of the Leased Premises, for such period; or
B. Take possession of and relet the Leased Premises, or any part
thereof, as the agent of Tenant, without terminating this Lease and
without being liable for prosecution or any claim for damages therefor for
such terms (which may extend beyond the maximum Lease Term provided for in
this Lease) as Landlord may, in Landlord's sole discretion, deem advisable
and at such rental which Landlord can negotiate. All rents received by
Landlord from such releasing shall be applied: (1) first to the payment of
all expenses incurred in connection with such re-entering and reletting
(including without limitation all repairs, renovations, alterations and
modifications helpful in reletting the Leased Premises, and attorney's
fees and related legal costs) together with interest on any sums so
advanced computed at the highest lawful rate per annum (unless there is no
maximum rate of interest provided by law with respect to such amount, in
which event such amount shall bear interest at the rate of 1-1/2% per
month) from the date of the expenditure of such sums until such payment is
received by Landlord; and (2) second to the payment of all past due Basic
Rent and Additional Rent. If the rent received by Landlord from such
reletting for any month be less than that owing by Tenant under this Lease
for such month, Tenant shall pay the deficiency to Landlord within ten
(10) days after written demand therefor (and if Tenant fails to do so,
interest shall run on such deficiency as set
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forth above in this Paragraph). So long as Tenant has not received
Landlord's written notice of termination, Landlord will be deemed to have
elected to relet the Leased Premises. Notwithstanding any reletting by
Landlord, Landlord may at any time decide to terminate this Lease if an
Event of Default remains uncured at such time. Notwithstanding anything
contained herein to the contrary, Landlord shall have no duty to relet the
Leased Premises, and the failure of Landlord to relet the Leased Premises
shall not release or affect Tenant's liability for the payment of Basic
Rent, Additional Rent, or any other charges due hereunder or for damages.
SEC. 9.4. CHANGE OF LOCKS. Following any uncured Event of Default as
aforesaid (and, if the Event of Default is non-monetary, ten (10) days after an
additional notice and opportunity to cure such Event of Default) Landlord may
alter locks and other security devices at the Leased Premises. Tenant agrees
that entry may be gained for this purpose through use of a duplicate master key
or any other peaceable means, that same may be conducted out of the presence of
Tenant if Landlord so elects, that no notice shall be required to be posted by
the Landlord on any door to the Leased Premises (or elsewhere) disclosing the
reason for such action or any other information, and that Landlord shall not be
obligated to provide a key to the changed lock to Tenant except during
Landlord's business hours and unless Tenant shall have first:
(i) brought current all payments due to Landlord under this
Lease; provided, however, that if Landlord has theretofore formally
and permanently repossessed the Leased Premises pursuant to
subparagraph 9.3(b), or has terminated this Lease pursuant to
subparagraph 9.3(a), then Landlord shall be under no obligation to
provide a key to the new locks to Tenant regardless of Tenant's
payment of past-due rent or other past-due amounts, damages, or any
other payments or amounts of any nature or kind whatsoever; and
(ii) fully cured and remedied to Landlord's reasonable
satisfaction all other defaults of Tenant under this Lease.
Landlord will, upon written consent by Tenant, during normal business hours and
upon Tenant's execution and delivery of such waivers as Landlord may reasonably
require, at Landlord's option either (i) escort Tenant or its specifically
authorized employees or agents to the Leased Premises to retrieve personal
belongings and effects of Tenant's employees, and property of Tenant that is
not subject to the Landlord's lien and security interest or (ii) obtain from
Tenant a list of such property described in (i) above, and arrange for such
items to be removed from the Leased Premises and made available to Tenant at
such place and at such time in or about the Premises or the Project as Landlord
may designate; provided, however, that if Landlord elects option (ii), then
Tenant shall be required to pay to Landlord (a) the estimated costs that
Landlord will incur in removing such property from the Leased Premises and
making same available to Tenant at the stipulated location, and (b) all moving
and/or storage charges theretofore incurred by Landlord with respect to such
property. The provisions of this Section 9.4 are intended to override and
supersede any conflicting provisions of the Texas Property Code (including,
without
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limitation, Section 93.002 thereof, and any amendments or successor statutes
thereto), and of any other law, to the maximum extent permitted by applicable
law.
Pursuit of any of the foregoing remedies in this Article 9 shall not preclude
pursuit of any of the other remedies herein provided or any other remedies
provided by law.
SEC. 9.5. TENANT REMEDIES. Upon the occurrence of any event of Landlord's
default set forth in Section 8.2 hereof, in addition to other remedies
available under law or equity, Tenant shall have the option to (i) cure such
default and invoice Landlord the reasonable cost incurred by Tenant in so
doing, and/or (ii) seek an order from a court for specific performance to cure
such default, and the reasonable cost incurred by Tenant shall be invoiced to
Landlord. If Landlord fails to pay such invoices within sixty (60) days after
delivery to Landlord, and if Tenant obtains a final judgment or arbitration
award for such amount against Landlord, if such final judgment or arbitration
award is not promptly paid, Tenant may offset the amount of such judgment
against future Basic and Additional Rent. Landlord and Tenant agree that
Tenant's right to remedies for Landlord's default as provided in this Section
9.5 shall be determined by arbitration conducted in Dallas, Texas in accordance
with the rules of the American Arbitration Association or such other rules as
Landlord and Tenant may agree upon.
ARTICLE X: MISCELLANEOUS PROVISIONS
SEC. 10.1. NOTICES
A. All notices allowed or required to be given hereunder must be in
writing and dispatched by United States certified mail, return receipt
requested, to the addresses shown below. Either party hereto may change
the address to which any such notice is to be addressed by giving notice
in writing, as provided herein, to the other party of such change. Any
notice or document required or permitted to be delivered by this Lease
shall be deemed to be delivered (whether or not actually received) when
deposited in the United States Mail, postage prepaid, certified mail,
return receipt requested, addressed to the parties at the respective
addresses set out below:
B. All rent and other payments required to be made by Tenant shall
be payable to Landlord at the address set forth below, or any other
address Landlord may specify from time to time by written notice delivered
to Tenant. All payments required to be made by Landlord to Tenant shall
be payable to Tenant at the address set forth below, or at any other
address within the United States as Tenant may specify from time to time
by written notice.
Landlord:
Dallas Lyndon Corporation
10925 Estate Lane, Suite 100
Dallas, Texas 75238
Attn: J. Clifton Whisnant
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Tenant:
National TechTeam, Inc.
10945 Estate Lane
Dallas, Texas 75238
Attn: William Crampton
and
22000 Garrison
Dearborn, Michigan 48124
Attn: Lawrence A. Mills
SEC. 10.2. WAIVER. The waiver by either Landlord or Tenant of any
provision of this Lease shall not be deemed to be a waiver of any other
provision. The subsequent acceptance of Basic Rent or Additional Rent by
Landlord from Tenant may under no circumstances be deemed to be a waiver of any
preceding breach (including, without limitation, the failure to pay said Basic
Rent or Additional Rent in accordance with the terms of this Lease) by Tenant
of any provision hereof regardless of Landlord's knowledge of such preceding
breach at the time of the acceptance of such rent. No provision of this Lease
may under any circumstances be deemed to have been waived by any party hereto
unless such waiver is in writing and signed by the party charged with such
waiver. Acceptance of any payment in an amount less than that portion then
owing under this Lease shall be deemed an acceptance on account only and not a
waiver regardless of any notation contained on such means of payment to the
contrary; and the failure to pay the entire amount then due shall constitute an
Event of Default.
SEC. 10.3. ENTIRE AGREEMENT AND AMENDMENTS. This Lease constitutes the
entire agreement between Landlord and Tenant, and there are no other covenants,
agreements, promises, terms, provisions, conditions, undertakings, or
understandings, either oral or written, between them concerning the Leased
Premises other than those herein set forth. No subsequent alteration,
amendment, change, deletion or addition to this Lease shall be binding upon
Landlord or Tenant unless in writing and signed by both Landlord and Tenant.
SEC. 10.4. NO JOINT VENTURE. Nothing herein contained shall be deemed to
constitute Landlord a partner of Tenant in the conduct of Tenant's business or
a joint venturer or a member of a joint enterprise with Tenant.
SEC. 10.5. PARTIAL INVALIDITY. If any provision of this Lease, or the
application thereof to any person or circumstances, shall to any extent be
invalid or unenforceable, the remainder of this Lease, or the application of
such affected provision to persons or circumstances other than those to which
it is held invalid or unenforceable, shall not be affected thereby, and each
provision of this Lease shall be valid and shall be enforced to the fullest
extent permitted by law. It is further the intention of Landlord and Tenant
that if any provision of this Lease is capable of two constructions, one of
which would render the provision void and other of which would render the
provision valid, then the provision shall have the meaning which renders it
valid.
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SEC. 10.6. BROKER'S COMMISSION. Landlord and Tenant each represent
and warrant to the other that there are no claims for brokerage commissions or
finder's fees in connection with the execution and delivery of this Lease other
than Revest Management Services, Inc. and Grubb & Ellis Company, all such
commissions to be paid by Landlord pursuant to separate written agreements.
Landlord agrees to indemnify and hold harmless Tenant from and against any
liability or claim, whether meritorious or not, arising with respect to any
broker or agent whose claim arises by, through or on behalf of Landlord
including, without limitation, the aforementioned commission obligations.
Tenant agrees to indemnify and hold harmless Landlord from and against any
liability or claim, whether meritorious or not, arising with respect to any
broker or agent whose claim arises by, through or on behalf of Tenant excluding
specifically the aforementioned commission obligations of Landlord.
SEC. 10.7. HEADING, CAPTIONS, ETC. The headings, captions, and
numbering system, used in this Lease are inserted only as a matter of
convenience and may under no circumstance be considered in interpreting the
provisions of this Lease.
SEC. 10.8. NO SETOFF. Except as provided herein, Tenant may under no
circumstances have any right of setoff or deduction against any payments
payable by Tenant to Landlord under any of the terms, provisions, conditions
and covenants of this Lease, but instead Tenant may register a protest in
connection with any payments being made and/or pursue its other remedies under
this Lease, at law or in equity.
SEC. 10.9. HOLDING OVER. Any holding over of the Leased Premises, or
any part thereof, by Tenant after the expiration of this Lease (for whatever
reason such termination may occur) shall be construed only as a tenancy from
day to day, terminable at the will of Landlord, at a daily rental of one
hundred fifty percent (150%) of the Basic Rent plus the amount of Additional
Rent payable during the last month of the term, as determined on a prorated
daily basis, and otherwise subject to the terms of this Lease applicable to
tenancies at sufferance.
SEC. 10.10. PLACE OF PERFORMANCE. The duties and obligations herein
contained are performable in Dallas County, Texas, and venue for any action
hereunder shall be in Dallas County, Texas.
SEC. 10.11. BUILDING IMPROVEMENTS. Tenant's architects are preparing
the plans and specifications (the "Plans") for the improvements to be made to
the Leased Premises (the "Improvements"). Tenant shall pay the entire cost of
the architectural services, including all engineering, consulting, and other
expenses Tenant's architects may incur in connection with preparation of the
Plans. The Plans will be subject to Landlord's reasonable approval. When the
final Plans have been agreed upon, they shall be signed by Landlord and Tenant
to indicate their approval. Landlord will pay $391,992 (the "Tenant Finish
Allowance") (based upon $12.00 per rentable square foot of the Leased Premises)
of the cost of the Improvements to be made pursuant to the Plans including, but
not limited to, millwork, fixtures, equipment, draperies, utilities and
hook-ups, all other finish work shown on the Plans, construction management and
administration fees, occupancy and relocation expenses, and any other costs
incurred by Tenant in occupying the Leased Premises. Included in the cost of
the Improvements, Tenant will address the following items normally considered
base building costs: any upgrades to restrooms required to meet ADA or TAS
compliance, life safety devices located
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within the Leased Premises, and all other items within the Leased Premises
pertaining to building permits, certificates of occupancy, ADA or TAS
compliance, or any other permit or permits, certificates of occupancy, ADA or
TAS compliance, or any other permit or governmental approval process. Any
additional improvements made to the base building as mandated by applicable
building codes, regulations, statutes, or ordinances, ADA, TAS, or other
similar laws will be timely completed by Landlord at its sole cost and expense
not from the Tenant Finish Allowance but as defined in Section 2.2. Additional
improvements may include, but are not limited to, upgrades to the building fire
control systems, elevators, entries and exits, parking lots, and all other
items outside the Leased Premises pertaining to building permits, certificates
of occupancy, ADA, or TAS compliance.
Landlord and Tenant shall agree upon the contractor to be used for the
Improvements and the form of the construction contract (the "Contract"). The
Contract shall be between the contractor and Landlord as Owner and shall
contain, among other things, a standard one-year warranty by the Contractor
against defects in workmanship or materials. Upon approval of the Contract, no
change shall be made to the terms of the Contract without the consent of Tenant
and Landlord including, without limitation, those affecting the contract sum.
The Contract shall provide that all payments to the contractor shall be made
jointly by Landlord and Tenant, and Tenant shall be a party to the Contract to
evidence Tenant's approval of the contract and Tenant's agreement to make such
payments. Landlord shall pay that part of each payment which bears the same
proportion to such payment as $391,992 bears to the total contract price, as
such price may be amended. Tenant shall pay the full cost incurred pursuant to
any change orders or extras. In the event of a price reduction, it is understood
that Landlord will in any event pay $391,992 of the cost of the Improvements.
Landlord shall require the contractor to perform all work and supply all
equipment, materials fixtures and other items shown on the Plans in a good and
workmanlike manner and in compliance with all applicable laws, rules, codes,
ordinances and regulations. Landlord will rely on Tenant's architect to assure
that the Improvements, fixtures, equipment, and other work set forth in the
Plans comply with the Americans With Disabilities Act, The Architectural
Barriers Act of the State of Texas and other similar laws. As and to the extent
provided in Section 2.2 hereof, and not as part of the Tenant Finish Allowance,
Landlord shall do the work, if any, required on the Building or the Project to
enable all necessary approvals and permits required from governmental agencies
to be obtained.
Landlord agrees that, immediately upon execution of the Contract and issuance of
all required permits and approvals, Landlord shall cause the contractor to
commence and diligently carry forward the work provided for in the Contract so
as to achieve the completion date specified in the Contract. Landlord agrees,
and the Contract shall provide, that Tenant's representatives shall have full
authority with regard to the progress and scheduling of the work with the
Contractor. If the time for completion of the work to the point of initial
occupancy of a portion of the Leased Premises is extended for reasons not caused
by Landlord or Contractor and without the written agreement of Landlord, Tenant
shall pay Basic Rent on a per diem basis at the rate provided for the first five
months of the Lease Term for the number of days of such extension in addition to
the Basic Rent payable beginning on the date of such initial occupancy. The
completion date shall be that date when the Improvements have been finally
completed in accordance with the Plans and a complete and unconditional
certificate of occupancy has been
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issued by the City of Dallas allowing occupancy by the Tenant of the entire
Leased Premises. At any time prior to the completion date when construction of
the Improvements has reached a status satisfactory to Tenant, Tenant shall have
the option to occupy a portion of the Leased Premises upon written notification
to Landlord and subject to the provisions of Section 3.1 hereof. The term of
this Lease and all obligations of Landlord and Tenant with regard to the actual
occupancy of the Leased Premises shall commence upon such occupancy, including,
without limitation Tenant's obligation to pay the Basic Rent. Landlord shall
continue the construction of Improvements until final completion and issuance
of the complete and unconditional certificate of occupancy for Tenant's
occupancy of the Leased Premises as provided in the Plans, the Contract, and
this Lease.
SEC. 10.12. RIGHT OF FIRST REFUSAL AND OPTION TO EXPAND. Landlord
hereby grants to Tenant the Right of First Refusal and Option to Expand into
(i) the Pocket Sandwich Shop space in the Building
containing 1,642 rentable square feet should it become
available; and
(ii) at any time after December 25, 1995, the
approximately 1,395 rentable square feet of space remaining
within the Building not within the Leased Premises
The rental rate for these respective spaces will be the same as the
then-current Basic and Additional Rent rate provided in this Lease at the time
such space is occupied. If Landlord desires to lease any of such space to a
third party, Landlord shall first notify Tenant in writing of its intention to
offer either space for lease. Tenant shall have twenty (20) days from receipt
of such notice to notify Landlord in writing of Tenant's intent to exercise its
right of first refusal. If Tenant does not exercise its right of first refusal
and Landlord enters into a lease with a bona fide third party for such space
within sixty (60) days after having given notice to Tenant, then Tenant's right
of first refusal as to the space described in the notice from Landlord to
Tenant shall terminate. If Landlord does not enter into such a lease within
said sixty (60) day period or upon the termination of the lease with such bona
fide third party, the rights granted to Tenant shall continue in force or be
re-established. If Tenant elects to exercise its right of first refusal to
lease any or all such space, the term for such space shall expire upon the
expiration of the Lease Term. Such space shall be subject to all of the terms,
covenants and conditions of this Lease. Within twenty (20) days from the date
of Tenant's election to exercise its right of first refusal, Landlord and
Tenant shall execute a modification and ratification of this Lease to include
the additional space. Thereafter, within a reasonable time, Landlord and
Tenant shall execute plans and specifications, change orders showing
construction costs to be paid by Tenant (which shall be the amount by which the
costs of construction exceed the amount Landlord will pay for such construction
on a per square foot basis) and other documents Landlord and Tenant agree are
necessary and appropriate. Landlord shall not pay more than Nine Dollars
($9.00) per rentable square foot for the improvements to such additional space,
such allowance to decline by 15 cents per square foot per month each month after
January 1, 1996, until such option is exercised by Tenant. Tenant may at any
time give Landlord notice of its
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desire to expand into all or a portion of the described refusal/expansion space
under all applicable terms and provisions hereof.
SEC. 10.13. COUNTERPARTS. This Lease may be executed in any number of
counterparts, each of which will for all purposes be deemed to be an original
and all of which shall constitute one agreement.
EXECUTED this 17th day of August, 1995.
LANDLORD: TENANT:
DALLAS LYNDON CORPORATION NATIONAL TECHTEAM, INC.
By: Revest Management Services, Inc.
Agent By: Lawrence A. Mills
-------------------------
Lawrence A. Mills
Chief Operating Officer
By:
--------------------------
J. Clifton Whisnant
President
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EXHIBIT "A"
PROJECT - LEGAL DESCRIPTION
BEING a tract of land situated in the City of Dallas and being or
intended to be all Lot 9, Block B/8051, Shelton/Dallas
Northeast Addition, an addition to the City of Dallas, Dallas
County, Texas, according to the Map thereof recorded in Volume
84059, Page 3086 of the Map Records, Dallas County, Texas,
said Lot 9 being more particularly described by metes and
bounds as follows:
BEGINNING at a 1/2-inch capped steel rod with NEBTEX stamped in said cap
and being the Northeast corner of said Lot 9, said POINT OF
BEGINNING also being on the Southerly R.O.W. line of Estate
Lane (a 60 foot R.O.W.);
THENCE South 35 degrees 02 minutes 55 seconds West (called South 35
degrees 00 minutes 40 seconds West), along the easterly line
of said Lot 9, a distance of 689.98 feet (called 690.00 feet)
to a 1/2-inch steel rod being the Southeast corner of said Lot
9;
THENCE North 16 degrees 52 minutes 03 seconds West (called North 16
degrees 52 minutes 53 seconds West), along a Southerly line of
said Lot 9, a distance of 323.89 feet (called 324.08 feet) to
a "+" cut in concrete being a point of angle to the left in
said Southerly line of Lot 9;
THENCE North 54 degrees 59 minutes 33 seconds West (called North 54
degrees 59 minutes 20 seconds West), continuing along a
Southerly line of said Lot 9, a distance of 304.88 feet
(called 305.00 feet), to a 3/4-inch steel rod being the
Southwest corner of said Lot 9;
THENCE North 35 degrees 01 minutes 21 seconds East (called North 35
degrees 00 minutes 40 seconds East), along the Westerly line
of said Lot 9, a distance of 490.06 feet (called 490.00 feet)
to a 1/2-inch steel rod on the Southerly R.O.W. line of said
Estate Lane, being the Northwest corner of said Lot 9;
THENCE South 54 degrees 59 minutes 20 seconds East (Reference
Bearing), along said Southerly R.O.W. line and along a North
line of said Lot 9, a distance of 560.04 feet (called 560.00
feet) to the POINT OF BEGINNING and embracing 299,873.17
Square Feet or 6.884 Acres of Land.
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EXHIBIT "B"
RULES AND REGULATIONS
Except in the event of conflict with the express written terms of the Lease
between Landlord and Tenant, in which case the terms of such Lease shall
control:
1. Tenant shall not do or permit anything to be done to said
premises in excess of the rights of usage as proposed to and agreed to by
Landlord, or bring or keep anything therein, which will in any way increase the
rate of fire insurance on said Project, or on property kept therein, or
obstruct or interfere with the rights of other Tenant, or in any way injure or
annoy them, or conflict with the laws relating to fire, or with regulations of
the fire department, or with any of the rules or ordinances of the Board of
Health of the municipality in which the building is located.
2. The sidewalks, halls, passageways, elevators and stairwells
will not be obstructed by the Tenants, or used by any Tenant for any purpose
other than for ingress and egress to and from their respective Premises. Nor
shall any rubbish, letter, trash or material of any nature be placed or emptied
in these areas.
3. Tenant shall adhere to and obey all such parking control
measures as may be placed into effect by the Landlord through the use of
signs, fire lanes identifying decals or other instructions.
4. No moving company shall be used for the purpose of moving
furnishings in or out of the Premises unless they are reputable commercial
movers.
5. Any electric wiring that the Tenant desires to introduce into
his Premises must be connected as directed by the Landlord. No boring or
cutting for wires will be allowed except with a specific consent of the
Landlord. The location of telephone, electrical appliances, call boxes,
intercoms and so forth shall be prescribed by the Landlord. All telephone
equipment will be installed within the Tenant's lease space.
6. The Tenant shall not conduct any auction of the Premises, nor
store goods, wares or merchandise on the premises except for the Tenant's own
personal use.
7. All freight must be moved into, within and out of the Project
under the supervision of the Landlord and according to such regulations as may
be posted in the Project Office. All moving of furniture or equipment into or
out of the Building by Tenant shall be done at such time and in such manner as
directed by the Landlord or its agent. In no cases, shall items of freight,
furniture, fixtures or equipment be moved into or out of the Building or in any
elevator during rush hours as are normally considered rush hours to an office
building; i.e., morning rush hours, noon rush hours, and evening rush hours.
All such movement shall be as directed by Landlord in a manner to be agreed upon
between Tenant and Landlord by prearrangement before performance. Such
prearrangement, initiated by Tenant shall include determination by Landlord and
subject to its decision and control of the time, method, and routing of
movement, limitation imposed by safety of other concerns which may prohibit any
article, equipment or any other
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items from being brought into the building. Tenant expressly assumes all risk
of damage to any and all articles so moved, as well as injury to any person or
persons or the public engaged or not engaged in such movement, including
equipment, property, and personnel of Landlord if damaged or injured as a
result of any acts in connection with carrying out this service for Tenant
from time of entering property to completion of the work; and Landlord shall
not be liable for the act or acts of any person or persons so engaged in, or
any damage or loss in connection with such service performed by or for Tenant.
8. Requirements of the Tenant for building services, maintenance
or repair shall be attended to only upon application to the office of the
Project. Employees of the Project are not permitted to perform any work nor to
do anything outside their regular duties unless under special instructions from
the office of the Project. No employees of the Project shall admit any person,
Tenant or otherwise, to any office, without specific instructions from the
office of the Project. Tenant will refer all contractor's representatives and
installation technicians rendering any service for Tenant, to Landlord for
Landlord's supervision and/or approval before performance of any such
contractual services. This shall apply to all work performed in the Building
including, but not limited to, installation of telephones, telegraph equipment,
electrical devices, and attachments, and installation of any and every nature
affecting floors, walls, woodwork, trim windows, ceilings, equipment or any
other physical portion of the Building. None of this work will be done by
Tenant without Landlord's prior written approval.
9. The Tenant shall not change locks or install other locks on
doors without the written consent of the Landlord. Landlord may permit
entrance to Tenant's office by use of pass keys controlled by Landlord, to
employees, contractors, or service personnel supervised or employed by
Landlord. No additional locks shall be placed upon the doors of the Leased
Premises, and Tenant shall not permit any duplicate keys to be made. All
necessary keys will be furnished by Landlord. Upon termination of the Lease,
Tenant shall surrender and deliver to the Landlord all keys to the Leased
Premises, which are in Tenant's possession or in the possession of Tenant's
agents, employees or others permitted to occupy said Premises by said Tenant.
10. The Tenant shall give prompt notice to the Landlord of any
accident to or defects in plumbing, electrical fixtures, or heating apparatus.
11. No safes or other objects larger or heavier than the freight
elevators of the Building are limited to carry shall be brought into or
installed on the Premises. The Landlord shall have the power to prescribed the
weight and position of such safes or other objects which shall, if considered
necessary by the Landlord, be required to be supported by such additional
materials placed on the floor as the Landlord may direct, and at the expense of
the Tenant. In no event can any items exceed a weight of 50 pounds per square
foot of floor space utilized.
12. No person or persons other than those approved by the Landlord
will be permitted to enter the Building for purposes of cleaning, maintenance,
construction or painting.
13. Tenant shall not permit or suffer the Premises to be occupied
or used in a manner offensive or objectionable to Landlord or other occupants
of the Project by reason of noise, odors, or vibrations or interfere in any way
with other tenants or those having business therein,
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nor shall any animals be kept in or about the Project. Smoking and carrying of
a lighted cigar or cigarette in the elevators or any common areas of the
Project is prohibited.
14. The Tenant shall at all times maintain the Premises in good
order, neatly, and shall not permit or allow the Premises to become unsightly
by reason of accumulation of trash, disarray of merchandise or contents, or
other, and, in the event that in Landlord's judgment Tenant has permitted the
Premises to become or to remain in an unsightly condition, Tenant shall upon
Landlord's request immediately correct such condition and bring the Premises
into a good state or order and array. In adherence to and enforcement of this
rule, it shall be clearly understood that the intent of this rule is that
Tenant shall at all times maintain the Premises in a neat and orderly manner,
and in the enforcement hereof Landlord's decision shall be binding and
controlling.
15. The Tenant shall at all times take such measures as required
to protect the carpet and agrees to use either carpet casters or approved
protective pads to prevent damage to the carpet from chairs. Tenant also
agrees that any damages resulting from moving furniture or any other cause of
damage to the carpet will be paid for by the Tenant and the Landlord will be
notified immediately so that such repairs as necessary may be made.
16. No cooking other than microwave cooking of a limited personal
type shall be done or permitted by Tenant on the Premises nor shall offices of
the Project be used for storage of merchandise or for lodging, or for any
immoral or illegal purpose or any other purpose that will damage the Leased
Premises or the condition thereof.
17. Each Tenant upon the termination of the tenancy shall deliver
to the Landlord all keys of the office rooms and toilet rooms which shall have
been furnished to the Tenant.
18. Tenant shall not install, affix, or utilize any window
covering, i.e., blinds, draperies reflective coating, etc. without Tenant first
receiving the prior written consent of the Landlord.
19. On Sundays, holidays (legal) and other days during certain
business hours for which the Building may be closed after normal hours, access
to the Building or to the halls, corridors, elevators and stairwells will be
controlled by the Landlord. Building personnel will have the right to demand
of any and all persons seeking access to the Building proper identification to
determine if they have rights of access to the Leased Premises. The Landlord
shall, in no case, be liable for damages wherein admission to the Building has
not been granted during abnormal hours by reason of a Tenant failing to
properly identify himself to the watchman, or through the failure of the
Building to be unlocked and open for access by the Tenant, Tenant's employees,
and general public.
20. Tenant shall see that doors of the Premises are closed and
securely locked before leaving the Building, must observe strict care not to
leave such doors and so forth open and exposed to the weather or other
elements, and the Tenant shall exercise extraordinary care and caution that all
water faucets or water apparatus are entirely shut off before the Tenant or
Tenant's employees leave the Building, and that all electricity, gas and air
shall likewise be carefully shut off so as to prevent waste or damage.
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21. Canvassing, soliciting and peddling in the Project are
prohibited. Tenant shall cooperate to prevent the same.
22. Only "Bulldog" type picture hangers may be used for wall
hangings. Nails, screws or picture hangers shall not be driven into the walls
or wood finish of the Leased Premises for any purpose whatsoever unless
specific approval in writing is obtained from Landlord.
23. All signs will be contracted for by Landlord for Tenant at the
rate fixed by Landlord from time to time, and Tenant will be billed and pay for
such service accordingly. Written consent from Landlord is an absolute
prerequisite for any such sign or signs which Tenant may be so permitted to
use.
24. Tenant shall not place, install or operate on the Leased
Premises or in any part of the Project, any engine, stove or machinery, or
conduct mechanical operations or cook thereon or therein, or place or use in or
about the Leased Premises any explosives, gasoline, kerosene, oil, acids,
caustics, or any other inflammable, explosive or hazardous material without
written consent of Landlord first had and obtained.
25. Landlord will not be responsible for any lost or stolen
personal property, equipment, money or jewelry regardless of whether such loss
occurs when the area is locked against entry or not.
26. Landlord shall have the right to prohibit the use of the name
of the Project or any other publicity by Tenant, which in the Landlord's
opinion, tends to impair the reputation of the Project or its desirability for
the executive offices of the Landlord or of other tenants; and, upon written
notice from Landlord, Tenant will refrain from or discontinue such publicity.
27. The Landlord reserves the right, at any time, to rescind any
one or more of these rules and regulations as in the Landlord's judgment may
from time to time be necessary for the safety, care and cleanliness of the
Leased Premises, and for the preservation of order herein.
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EXHIBIT "C"
OUTLINE AND LOCATION OF PREMISES
10945 Estate Lane
Dallas, Texas 75238
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[WADDILL GROUP LOGO]
NATIONAL TECH TEAM
LYNDON PLAZA - EAST BUILDING
10945 Estate
Dallas, TX
1 Furniture Plan - First Floor
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[WADDILL GROUP LOGO]
NATIONAL TECH TEAM
LYNDON PLAZA - EAST BUILDING
10945 Estate
Dallas, TX
1 Furniture Plan - Second Floor
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[WADDILL GROUP LOGO]
NATIONAL TECH TEAM
LYNDON PLAZA - EAST BUILDING
10945 Estate
Dallas, TX
1 Furniture Plan - Third Floor
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EXHIBIT "D"
TENANT'S CERTIFICATE OF INSURANCE
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EXHIBIT "E"
LANDLORD'S REPRESENTATIONS AND WARRANTIES
Landlord covenants, warrants and represents as follows:
(a) Landlord has full right and power to execute and perform this
Lease and to grant the estate demised herein.
(b) There is no covenant, deed restriction or other agreement
applicable to the use of the Project or the Leased Premises which affect or
restrict in any way the permitted use of, or the permitted activities which may
be conducted in or about, the Project or the Leased Premises by Tenant as
provided in this Lease.
(c) There are no existing or, to the best of Landlord's knowledge,
proposed or contemplated eminent domain proceedings which would affect the
Leased Premises in any way whatsoever, and to the best of Landlord's knowledge,
there are no contemplated public improvements which will or would result in any
charge being levied or assessed against, or in the creation of any lien upon,
the Leased Premises.
(d) The Leased Premises is connected to and serviced by water,
solid waste and sewage disposal, storm drainage and electricity and gas
facilities.
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EXHIBIT "F"
RENEWAL OPTION
If, at the end of the primary term or, if the first renewal option is
exercised, the first renewal term, as applicable, of this Lease, Tenant is not
in default in any of the material terms, conditions or covenants of this Lease,
Tenant, is hereby granted two (2) options to renew this Lease for additional
terms of two (2) and three (3) years respectively upon the same terms and
conditions contained in this Lease with the following exceptions:
A. Any renewal option term will not contain a further renewal
option unless expressly granted by Landlord in writing; and
B. The rental for each renewal term shall be ninety-five percent
(95%) of the then prevailing rental rates for properties of
equivalent quality, size, utility and location, with the
length of the lease term and credit standing of the Tenant to
be taken into account.
If Tenant desires to renew this Lease, Tenant will notify the Landlord
of its intention to renew no later than six (6) months prior to the expiration
date of the term of this Lease; Landlord shall, within the next ten (10) days
notify Tenant in writing of the proposed renewal rate and Tenant shall, within
the next fifteen (15) days following receipt of the proposed rate, notify
Landlord in writing of its acceptance or rejection of the proposed rental rate.
In the event that Tenant does not accept the rental as stated by Landlord and
Tenant gives Landlord notice of rejection as above stated, then Tenant may
request arbitration of such rental in accordance with the following procedure.
Landlord shall appoint one qualified (MAI) appraiser, Tenant shall appoint one
qualified (MAI) appraiser and those two appraisers shall mutually agree upon a
third qualified (MAI) appraiser. Landlord and Tenant shall each bear the cost
of its appraiser and one-half (1/2) of the third appraiser. The three said
appraisers, shall within thirty (30) days after the notice from Tenant that it
notifies Landlord of Tenant's rejection of the rental determine the fair market
rental in accordance with the parameters set forth herein and shall notify
Landlord and Tenant in writing of such ninety-five percent (95%) of market
rental. The Base Year shall be advanced to be the year the applicable renewal
term commences. Tenant shall have twenty (20) days to accept or reject, in
writing, the renewal term rental as above determined. If such rental is not
agreed to by Tenant as determined by said appraisers on or before the end of
the twenty (20) day period then this Option to renew and all rights of Landlord
and Tenant under this Option to renew shall immediately terminate and all terms
and conditions of this Option to renew shall be of no further force and effect
and the cost of the appraisal process including any cost, fee or expense
incurred by either party in the process shall be borne by the party incurring
same except as specifically stated above.
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