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EXHIBIT 10.2
HARRINGTON PLACE
OFFICE LEASE
BY AND BETWEEN
TGALMA LIMITED, A TEXAS LIMITED PARTNERSHIP
AS LANDLORD,
AND
CREDENTIALS SERVICES INTERNATIONAL, INC., A CALIFORNIA CORPORATION,
AS TENANT
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TABLE OF CONTENTS
1. Definitions and Basic Lease Provisions . . . . . . . . . . . . . . . . . . . 1
2. Premises . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
3. Lease Term . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4. Acceptance of Premises . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
5. Rent Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
6. Electricity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
7. Services by Landlord . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
8. Service Interruptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
9. Operating Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
10. Rental Tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
11. Security Deposit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
12. Assignment and Subletting . . . . . . . . . . . . . . . . . . . . . . . . . . 6
13. Repair and Maintenance by Tenant . . . . . . . . . . . . . . . . . . . . . . 6
14. Alterations and Additions by Tenant . . . . . . . . . . . . . . . . . . . . . 7
15. Use and Occupancy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
16. Parking . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
17. Mechanics' Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
18. Liability of Landlord . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
19. Tenant's Indemnification of Landlord . . . . . . . . . . . . . . . . . . . . 8
20. Tenant's Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
21. Landlord's Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
22. Rights Reserved by Landlord . . . . . . . . . . . . . . . . . . . . . . . . . 9
23. (Intentionally Deleted) . . . . . . . . . . . . . . . . . . . . . . . . . . 10
24. Fire or Other Casualty . . . . . . . . . . . . . . . . . . . . . . . . . . 10
25. Condemnation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
26. Taxes on Tenant's Property . . . . . . . . . . . . . . . . . . . . . . . . 11
27. Waiver of Subrogation . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
OFFICE LEASE Page i
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28. Surrender Upon Termination or Expiration; Holdover . . . . . . . . . . . . 12
29. Tenant's Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
30. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
31. Landlord's Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
32. No Implied Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
33. Waiver by Tenant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
34. Landlord's Lien . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
35. Attorneys' Fees and Legal Expenses . . . . . . . . . . . . . . . . . . . . 15
36. Subordination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
37. Quiet Enjoyment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
38. Notice to Landlord . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
39. Rules and Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
40. Estoppel Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
41. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
42. Hazardous Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
43. Business Purpose . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
44. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
45. No Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
46. Force Majeure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
47. Brokerage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
48. Gender . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
49. Joint and Several Liability. . . . . . . . . . . . . . . . . . . . . . . . 17
50. No Representations . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
51. Entire Agreement; Amendments . . . . . . . . . . . . . . . . . . . . . . . 17
52. Paragraph Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
53. Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
54. Exhibits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
15. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
56. Tenant's Service Providers . . . . . . . . . . . . . . . . . . . . . . . . 18
OFFICE LEASE Page ii
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57. Rate of Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
58. Right of First Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
59. Signage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
60. Execution and Approval of Lease . . . . . . . . . . . . . . . . . . . . . . 19
61. Cabling Allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
62. Rental Abatement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
63. Security System Installation . . . . . . . . . . . . . . . . . . . . . . . 19
EXHIBITS:
A: Land
B: Premises
C: Tenant Finish Construction
D: Project Rules and Regulations
E: Contractor Insurance Requirements
F: Right of First Notice
OFFICE LEASE Page iii
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This Office Lease (this Lease) is entered into as of June 13th, 1995
(the date of this Lease), TGALMA Limited, a Texas Limited Partnership
(Landlord), and Credentials Services International, Inc., a California
Corporation (Tenant).
1. Definitions and Basic Lease Provisions.
Some of the basic provisions and defined terms of this Lease are as
follows:
Project: The Harrington Place Building and the Land described on
Exhibit A.
Project Address: 1700 Alma, Plano, Texas 75075
Premises: Approximately 15,452 Rentable Square Feet as shown on
Exhibit B. Suite(s) 500 on Floor(s) five (5) of the
Building.
Total Project Area: 86,718 Rentable Square Feet.
Annual Base Rent: Term of Rental Rate
(Annually) (Monthly)
Jun. 1, 1995 Through Jun. 30, 1995 $ 189,287.00 $ 15,773.92
Jul. 1, 1995 Through Oct. 31, 1995 $ 0.00 $ 0.00
Nov. 1, 1995 Through Sep. 30, 1996 $ 189,287.00 $ 15,773.92
Oct. 1, 1996 Through Sep. 30, 1997 $ 193,150.00 $ 16,095.83
Oct. 1, 1997 Through Sep. 30, 1998 $ 193,150.00 $ 16,095.83
Oct. 1, 1998 Through Sep. 30, 1999 $ 197,013.00 $ 16,417.75
Oct. 1, 1999 Through Sep. 30, 2000 $ 197,013.00 $ 16,417.75
Oct. 1, 2000 Through Sep. 30, 2001 $ 200,876.00 $ 16,739.67
Rent: The Base Rent and all other amounts payable by
Tenant to Landlord under this Lease.
Commencement Date: June 1, 1995 (which date shall be at least 45 days
after the execution of this Lease).
Expiration Date: September 30, 2001
Lease Term: Seventy-six (76) months, ending on the Expiration
Date.
Base Year: The first full twelve (12) months of occupancy.
Tenant's Share: 17.824 %.
Tenant's Broker: Dale Clements of Miller Commercial and Gregory Gill
of Matlow-Kennedy.
Landlord's Agent: Harwood Pacific Corporation, a Texas corporation.
Security Deposit: $15,773.92
Permitted Use: General business offices.
Parking: No more than 90 undesignated parking spaces.
Tenant Party(ies): Tenant and its agents, employees, licensees,
servants, and invitees.
Addresses for notices under this Lease:
LANDLORD: TENANT: GUARANTOR:
TGALMA Limited, a Texas Limited Credentials Services N/A
Partnership International
c/o Harwood Pacific Corporation Inc., a California Corporation
2651 North Harwood, Suite 450 1700 Alma, Ste. 500
Dallas, Texas 75201 Plano, Texas 75075
Attention: Doug Walker, Attention: Nick Rees
General Manager Fax: N/A
Fax: (214)871-0879
with a copy to:
Credentials Services International,
Inc., a California Corporation
600 City Parkway West, 2nd Floor
Orange, California 92668
Fax: N/A
OFFICE LEASE Page 1
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2. Premises.
Landlord, in consideration of the Rent and the obligations of Tenant
under this Lease, hereby leases the Premises to Tenant and Tenant
takes the Premises as subject to the terms of this Lease. The number
of RENTABLE SQUARE FEET in the Premises and the Project is deemed to
be the square footage as set forth in Paragraph 1.
3. Lease Term.
(a) The Lease Term begins on the earlier to occur of (1) the date
Tenant occupies any part of the Premises or (2) the later to occur of
the Commencement Date or the Ready for Occupancy Date (defined below)
and ends on the Expiration Date.
(b) If the Ready for Occupancy Date does not occur by the Commencement
Date for any reason other than omission, delay, or default by any
Tenant Party, including, without limitation, delays caused by the
negligence of the Landlord, its agents or contractors, or the City of
Plano, Tenant's obligation to pay Rent does not commence until the
Ready For Occupancy Date occurs and the Expiration Date is extended to
the last day of the month following a period of time equal to the time
period beginning on the Commencement Date and ending on the day before
the Ready for Occupancy Date. This abatement of Rent is Tenant's sole
remedy and is full settlement of all claims that Tenant has against
Landlord by reason of the Premises not being ready for occupancy by
Tenant on the Commencement Date; provided, however, if the Ready for
Occupancy Date has not occurred within one hundred twenty (120) days
following the Commencement Date due to the acts, omissions or
negligence of Landlord, its agents or employees, Tenant may terminate
the Lease as its sole and exclusive remedy, and the parties shall be
released from all obligations under this Lease.
(c) If Tenant occupies any part of the Premises before the
Commencement Date or the Ready for Occupancy Date, as applicable, the
Lease Term and Tenant's obligation to pay Rent commence on the date
Tenant occupies the Premises and ends on the Expiration Date. Tenant
is deemed to occupy the Premises when Tenant takes possession of any
part of the Premises for any purpose, including placing furniture and
installing Tenant's equipment in the Premises; provided, however,
Tenant shall be granted the right to install its telephone/computer
cable and furniture systems prior to the Commencement Date so long as
the same does not interfere with Landlord's completion of the Tenant's
Finish Work. In addition, the Tenant shall have access to the
telecommunications room following execution of this Lease and when
such room is available. The Landlord agrees to instruct its contractor
to schedule such Tenant Finish Work in such a fashion as to reasonably
make the telecommunications room available and ready for Tenant's use
no later than ten (10) days following the commencement of the Tenant
Finish Work. Landlord agrees that the foregoing rights of Tenant shall
not constitute occupancy of the Premises and therefore shall not
trigger the payment of rent under the Lease.
(d) When the Ready For Occupancy Date is determined, Landlord and
Tenant shall exchange a letter acknowledging that date and, if the
Expiration Date changes under this Paragraph, the Expiration Date. If
any dispute arises regarding those dates, a certificate furnished by
Landlord's architect certifying the date Landlord substantially
completed the Tenant Finish Work (as defined in Exhibit C) is
conclusive and binding upon Landlord and Tenant.
(e) The Ready For Occupancy Date is the earlier to occur of (i) the
date the City of Plano approves the Premises for occupancy; or (ii)
the date the City of Plano would have approved the Premises for
occupancy but for delays caused by any Tenant Party; provided, if
Landlord performs any Additional Work (defined in Exhibit C), the
Ready for Occupancy Date is deemed accelerated by the number of days
in the Additional Work Period (defined in Exhibit C).
4. Acceptance of Premises.
Tenant's occupancy of the Premises is conclusive evidence that Tenant:
(A) accepts the Premises as suitable for the purposes for which they
are leased; (B) accepts the Premises and the Project as being in a
good and satisfactory condition subject only to such punchlist items
to be submitted by Tenant to Landlord within five (5) days following
the Ready for Occupancy Date, detailing those items of the Tenant
Finish Work in need of repair, replacement or completion by the
Landlord's contractor; and (C) waives any defects in the Premises and
the Project. Except for the gross negligence or intentional misconduct
of Landlord, its agents employees and contractors, Landlord is not
liable to any Tenant Party for any injury or damage to person or
property due to the condition or design of, or any defect in, the
Project that exists now or occurs in the future. Except for the gross
negligence or intentional misconduct of Landlord, its agents employees
and contractors, Tenant, for itself and all other Tenant Parties,
assumes all risks of injury or damage to person or property, either
proximate or remote, by reason of the condition or design of, or any
defects in, the Premises and the Project.
OFFICE LEASE Page 2
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5. Rent Payments.
(a) The first installment of Base Rent is payable by Tenant when this
Lease is executed. Subsequent installments of Base Rent are payable by
Tenant in advance on the first day of each calendar month during the
Lease Term beginning on the first day of the first full calendar month
after the Commencement Date (or the Ready for Occupancy Date, if
applicable). Base Rent for any partial calendar month is prorated on a
per diem basis.
(b) All Rent is payable by Tenant at the times and in the amounts
specified in this Lease in legal tender of the United States of
America to Landlord at the notice address for Landlord or to any other
person or at any other address as Landlord may from time to time
designate by notice to Tenant.
(c) Rent is payable by Tenant without notice, demand, abatement,
deduction or setoff, except as expressly specified in this Lease.
Tenant's obligation to pay Rent is independent of any obligation of
Landlord under this Lease. If any installment of Rent is not paid
within 10 days after it is due, Tenant shall pay a late charge in an
amount equal to 10% of the delinquent installment of Rent when it pays
the delinquent installment.
6. Electricity.
(a) Landlord, as specified below, shall furnish electricity as
follows: (i) up to 4 watts per Rentable Square Foot in the Premises at
208 volts for lighting; and (ii) up to 4 watts per Rentable Square
Foot in the Premises at 110 volts for office machines. If Tenant's use
will exceed the specified levels, Tenant must give Landlord prior
notice specifying Tenant's excess requirements. If the excess
electricity requirements can be supplied without, in Landlord's sole
opinion, overloading the existing Building systems or the additional
equipment necessary to supply Tenant's excess electricity requirements
can be installed without, in Landlord's sole opinion, creating a
dangerous condition in the Building, Landlord shall supply Tenant's
excess electricity requirements and Tenant shall pay Landlord the cost
of supplying the excess electricity requirements, including all
installation and submetering costs, on demand as additional Rent.
(b) If Tenant's actual electricity use exceeds its pro-rata share as
determined by Landlord, Landlord shall cause Landlord's engineer to
determine, at Tenant's sole cost and expense, the amount of excess
electricity to be allocated to Tenant based on the power requirements
of Tenant's equipment or lighting and Tenant shall pay Landlord on a
monthly basis the cost of the excess electricity as reasonably
determined by Landlord's engineer on demand as additional Rent.
Landlord may also, at its sole option and without any obligation to do
so, install supplemental air conditioning units in the Premises to
offset the heat-generating effect of Tenant's excess electricity usage
and Tenant shall pay Landlord the installation cost and the cost of
operation, use, repair, and replacement of the supplemental air
conditioning units on demand as additional Rent. The
telecommunications room in the Premises shall be separately metered
and Tenant shall pay as additional rent the cost of all electricity
usage for the equipment located therein.
(c) The obligation of Landlord to furnish electricity is subject to
the rules and regulations of the supplier of electricity and of any
municipal or other governmental authority regulating the business of
providing electricity. Landlord is not liable to Tenant for any
failure or defect in the supply or character of electricity furnished
to the Premises due to any requirement, act, or omission of the entity
supplying electricity to the Project.
7. Services by Landlord.
Landlord, subject to payment by Tenant as specified below, shall
furnish the following services for the occupied portions of the
Premises in a fashion consistent with comparable buildings in the
Plano submarket:
(a) Air conditioning, both heating and cooling (as required by the
seasons), from 6:30 a.m. to 8:00 p.m. on weekdays and on Saturdays
from 6:30 a.m. to 3:00 p.m., except on Holidays (as defined in Exhibit
D) (the HVAC Standard Hours) at temperatures and in amounts as are in
the sole judgment of Landlord reasonably required for comfortable use
and occupancy under normal business operations. Circulating air is
not available other than through the Building's HVAC system. Landlord
has no obligation to redesign the existing method of operation of the
Building's HVAC system. If Tenant requires HVAC services at any time
other than HVAC Standard Hours, Landlord shall furnish the services
for the portions of the Premises specified in a request by Tenant
received by the Project manager before 3:00 p.m. of the business day
preceding the date extra usage is required. Tenant shall pay Landlord
as additional Rent for such extra service an amount equal to
Landlord's actual cost for such service, including any administrative
costs incurred by Landlord in providing such service, up to a maximum
of $30.00 per hour for such excess service;
OFFICE LEASE Page 3
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(b) Cold and hot water (at the normal temperature of the water supply
to the Building) for lavatory and toilet purposes, with water service
to be at supply points provided for general use of tenants of the
Building through fixtures installed by Landlord, or by Tenant with
Landlord's prior consent;
(c) Janitor service to the Premises on days other than Fridays,
Saturdays, and Holidays;
(d) Window washing as determined by Landlord in its reasonable
discretion;
(e) Operator-less passenger elevators for ingress and egress to and
from the floor(s) on which the Premises are located (provided that
Landlord may reasonably limit the number of elevators to be in
operation on Saturdays, Sundays, and Holidays) and, to the extent
available, freight elevator service in common with other tenants but
only when scheduled through the Project manager;
(f) Common area rest room facilities; and
(g) Electric lighting for all common areas of the Building in the
manner and to the extent deemed by Landlord to be reasonable and
standard.
Building Standard Hours are weekdays, excluding Holidays, from 7:00
a.m. to 8:30 p.m. and Saturdays from 7:00 a.m. to 1:30 p.m., which
hours shall remain constant throughout the Term. Landlord may lock the
Building at all times other than during Building Standard Hours.
8. Service Interruptions.
Landlord does not warrant that the services provided by Landlord will
be free from any slow-down, interruption, or stoppage under voluntary
agreement between Landlord and governmental bodies, regulatory
agencies, utility companies, and others supplying services or caused
by the maintenance, repair, replacement, or improvement of any
equipment involved in the furnishing of the services or caused by
changes of services, alterations, strikes, lock-outs, labor
controversies, fuel shortages, accidents, acts of God, the elements,
or other causes beyond the reasonable control of Landlord. No
slow-down, interruption, or stoppage of the services may be construed
as an eviction, actual or constructive, of Tenant or cause an
abatement of Rent or in any manner or for any purpose relieve Tenant
from its obligations under this Lease. Landlord is not liable for
damage to persons or property, or in default under this Lease, as a
result of any slow-down, interruption, or stoppage. Landlord shall use
due diligence to resume the service upon any slow-down, interruption,
or stoppage. Notwithstanding the foregoing, in the event the services
furnished by Landlord are disrupted as a result of Landlord's gross
negligence or intentionally misconduct and such disruption prevents
Tenant from operating its business in the Premises for seventy-two
(72) continuous hours, thereafter all Rent and other charges shall
abate until the earlier of the restoration of such services or
Tenant's ability to resume operations in the Premises.
9. Operating Costs.
(a) The term Operating Costs means those expenses [(other than
expenses for electricity)] directly incurred in the management,
operation, maintenance, repair, and security of the Project, including
but not limited to the cost of all utilities, building supplies,
janitorial service, maintenance, repairs, fire and extended coverage,
public liability, and other insurance, all labor and employee benefit
costs (including wages, salaries, and fees of all personnel engaged in
the management, operation, maintenance, repair, and security of the
Project), ad valorem taxes and assessments, costs that reduce
operating expenses or are required to meet governmental regulations,
management fees, consulting fees, legal fees, accounting fees, and the
fair market rental of the Project managers' offices, together with
payments or credits Landlord makes to any tenant or tenants in the
Project in lieu of Landlord providing any of the services or paying
for any of the costs. If for any time period in question the Project
is less than 95 % occupied, Landlord shall increase those elements of
Operating Costs that vary based on the occupancy rate of the Project
as though the Project were 95 % occupied. Operating Costs shall
exclude the following: advertising costs; commissions and marketing
costs; charges exclusively benefiting another tenant's use; legal fees
specific to other tenant leases; capital improvements to the common
areas, except to the extent the same are amortized over the useful
life of such improvements according to generally accepted accounting
principles; wages and salaries of employees to the extent not involved
in the operation of the Project; costs for renovations or improvements
to other tenant premises; depreciation or amortization of the Project;
penalty or late payments incurred by Landlord, its agents or
contractors due to its negligence or willful misconduct; costs
associated with the removal or abatement of Hazardous Substances
(hereinafter defined) unless introduced into the premises by Tenant,
its agents or contractors; costs of repair or replacement items
covered
OFFICE LEASE Page 4
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by warranty; costs to comply with the Americans with Disabilities Act,
as of the date of this Lease; and costs associated with retail
operations. Notwithstanding anything to the contrary contained herein,
the Landlord's Controllable Operating Costs (hereinafter defined)
shall not increase by more than six percent (6%) per annum
Controllable Operating Costs shall mean all Operating Costs except
such expenses and costs which cannot be controlled by Landlord,
including but not limited to taxes, utilities and insurance.
(b) The term Excess Operating Costs means the amount by which the
Operating Costs for any calendar year after the first twelve (12)
months of occupancy exceed the Operating Costs for the first twelve
(12) months.
(c) If there are Excess Operating Costs for any calendar year, Tenant
shall pay to Landlord as additional Rent Tenant's Share of the Excess
Operating Costs.
(d) On or before December 15 of the Base Year and each subsequent
calendar year, Landlord shall deliver to Tenant Landlord's reasonable
estimate of the Excess Operating Costs on a Rentable Square Foot basis
for the next calendar year. Tenant shall pay to Landlord monthly as
additional Rent, in advance on or before the first day in each
succeeding calendar month, an amount equal to one twelfth (l/12th) of
the product of Tenant's Share of estimated Excess Operating Costs
multiplied by the Total Project Area for the applicable calendar year.
Landlord may adjust its estimate by notice to Tenant at any time
during the applicable calendar year if actual Excess Operating Costs
are substantially different from the estimate, and thereafter payments
by Tenant under this Paragraph adjust accordingly. The term calendar
year includes partial calendar years.
(e) No later than October 1 of each calendar year, Landlord shall
deliver to Tenant a statement certified by an authorized
representative of Landlord setting out in reasonable detail the actual
Excess Operating Costs for the prior calendar year. If the estimated
payments made by Tenant during the prior calendar year exceed Tenant's
Share of actual Excess Operating Costs for that year, Landlord shall
credit the difference against the next ensuing installments of
estimated payments by Tenant under this Paragraph. If the estimated
payments made by Tenant during the prior calendar year under this
Paragraph are less than Tenant's Share of the actual Excess Operating
Costs for that year, Tenant shall pay the amount of the difference to
Landlord in cash within 30 days after delivery of any invoice therefor
by Landlord accompanied by a statement of the actual Excess Operating
Costs for that year as additional Rent. Notwithstanding anything to
the contrary contained herein, Tenant shall have the right, not more
than once annually and no more than three (3) times during the Term,
to audit Landlord's calculation of the Operating Costs for the
preceding calendar year. Such audit may be conducted at Tenant's sole
cost and expense in Landlord's offices during normal business hours,
upon reasonable advance notice to Landlord with no more than two (2)
persons for no longer than two (2) consecutive eight (8) hour periods.
If such audit, conducted by an independent certified public accountant
reveals that Landlord has overstated Operating Costs by more than five
percent (5 %) for such calendar year, then in addition to the refund
of such overpayment, Landlord shall pay Tenant's reasonable audit
costs.
10. Rental Tax.
Tenant shall pay as additional Rent all licenses, charges, and other
fees of every kind and nature as and when they become due arising out
of or in connection with Tenant's use and occupancy of the Premises
and the Project (including the parking garages), including but not
limited to license fees, business license taxes, and privilege, sales,
excise, or other taxes (other than income) imposed upon Rent or upon
services provided by Landlord or upon Landlord in an amount measured
by Rent received by Landlord, but excluding any income or inheritance
taxes.
11. Security Deposit.
(a) Tenant shall pay the Security Deposit to Landlord upon execution
of this Lease as security for the performance by Tenant of its
obligations under this Lease. The Security Deposit does not bear
interest and is not an advance payment of Rent or a measure of
Landlord's damages for a default by Tenant. If Tenant defaults in the
performance of any of its obligations under this Lease, Landlord may,
without prejudice to any other remedy, use the Security Deposit to the
extent necessary to make good any arrearages in Rent or any other sum
for which Tenant is in default and any other damage, injury, expense,
or liability caused to Landlord by the default. If Landlord so applies
any part of the Security Deposit, Tenant shall pay to Landlord on
demand the amount necessary to restore the Security Deposit to its
original amount.
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(b) If Tenant is not then in default under this Lease, Landlord shall
return any remaining balance of the Security Deposit to Tenant upon
termination or expiration of this Lease and after surrender by Tenant
of possession of the Premises to Landlord in accordance with this
Lease.
(c) If Landlord assigns its interest in the Premises, Landlord shall
assign the Security Deposit to the assignee. Landlord has no further
liability for the return of the Security Deposit after the assignment
and Tenant shall look solely to the assignee for the return of the
Security Deposit. Tenant may not assign or encumber or attempt to
assign or encumber the Security Deposit. Landlord and its successors
and assigns are not bound by any actual or attempted assignment or
encumbrance of the Security Deposit by Tenant.
12. Assignment and Subletting.
(a) Tenant may not, without Landlord's prior consent: (1) assign or
transfer this Lease or any interest therein; (2) permit any assignment
of this Lease or any interest therein by operation of law; (3) sublet
the Premises or any part thereof; (4) grant any license, concession,
or other right of occupancy of any portion of the Premises; (5)
mortgage, pledge, or otherwise encumber its interest in this Lease; or
(6) permit the use of the Premises by any parties other than Tenant
and its employees. Landlord's consent to any assignment or subletting
is not a waiver of Landlord's right to approve or disapprove any
subsequent assignment or subletting. Notwithstanding the foregoing,
Tenant shall have the right to assign its obligations under the Lease
to a wholly owned subsidiary or parent entity without the consent of
Landlord and without Landlord's right to terminate as provided in
paragraph 12(d), provided Tenant shall remain liable for all
obligations under the Lease. Furthermore, Landlord shall agree that
its consent to an assignment of the Lease by Tenant shall not be
unreasonably withheld or delayed in the event Tenant assigns the Lease
to an entity with a net worth which is equal to or greater than Tenant
both as of the date of this Lease and at the time of the proposed
assignment, such assignee shall have a use of the Premises which is
substantially the same as the Tenant and shall not unreasonably
interfere with the use or occupancy of any other tenant in the
Project. Tenant and any guarantor of Tenant's obligations under this
Lease (GUARANTOR, whether one or more) remain jointly and severally
liable for the payment of Rent and performance of all other
obligations under this Lease after any assignment or subletting. Any
change in a majority of the voting rights or other control rights of
Tenant is an assignment for purposes of this Paragraph. If Tenant is a
partnership, then any transfer of a general partnership interest is an
assignment for purposes hereof. As a condition to the effectiveness of
each assignment or subletting, and whether or not Landlord's prior
consent is required for the assignment or subletting, Tenant shall pay
to Landlord its reasonable administrative and legal costs in
connection therewith not to exceed $1,000.00. Any attempted assignment
or sublease by Tenant in violation of the terms of this Paragraph is
void.
(b) Landlord, in addition to any other remedies under this Lease or
provided by law, may at its option collect directly from the assignee
or sublessee all rents payable to Tenant under the assignment or
sublease and apply the rent against any sums due to Landlord under
this Lease. Tenant authorizes and directs any assignee or sublessee to
make payments of rent directly to Landlord upon receipt of notice from
Landlord. No direct collection of rent by Landlord from any assignee
or sublessee is a novation or a release of Tenant or Guarantor from
the performance of their obligations under this Lease or under any
guaranty executed by Guarantor. Receipt by Landlord of rent from any
assignee, sublessee, or occupant of the Premises is not a waiver of
the covenant against assignment and subletting or a release of Tenant
or Guarantor.
(c) If Tenant wants to assign or sublease all or part of the Premises,
it shall deliver a notice to Landlord specifying the name of,
financial information for, and the nature of the business of the
proposed assignee or subtenant, and the proposed effective date and
terms of the assignment or sublease. Tenant may not assign or sublease
all or any part of the Premises at any time when Tenant is in default
under this Lease, whether or not an Event of Default has occurred.
(d) Landlord has a period of 30 days from receipt of Tenant's notice
and all information required herein to notify Tenant that Landlord
elects, in Landlord's sole discretion, to: (1) terminate this Lease as
to the space that is the subject of Tenant's notice as of the date
specified by Tenant; (2) consent to the assignment or sublease;
provided, if the rent payable to the Tenant by the sublessee is
greater than the Base Rent, the excess rent is payable by Tenant as
additional Rent to Landlord on the same dates Tenant pays Base Rent;
or (3) refuse to consent to Tenant's assignment or sublease of that
space. If Landlord does not notify Tenant of Landlord's election
within the 30-day period, Landlord is deemed to elect option (3).
13. Repair and Maintenance by Tenant.
(a) Tenant shall keep the Premises and all fixtures installed by or on
behalf of Tenant in good and tenantable condition. Tenant shall
promptly make all necessary non-structural interior repairs and
replacements thereto except those caused by fire
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or other casualty, all at Tenant's expense, under the supervision and
with the approval of Landlord. All repairs and replacements must be
equal in quality and class to the original work. Without diminishing
this obligation of Tenant, if Tenant fails to commence and diligently
pursue any repairs and replacements within ten (10) days following
notice from Landlord after the occurrence of the damage or injury,
Landlord may at its option make the repairs and replacements and
Tenant shall pay Landlord on demand as additional Rent the costs
incurred by Landlord, plus an administrative fee equal to 10% of the
actual cost thereof, plus 18% per annum interest from date of payment
by Landlord.
(b) To the extent Tenant fails to repair the same, Tenant shall pay
the cost of repairs and replacements due to damage or injury to the
Project or any part thereof caused by any Tenant Party. This amount is
payable by Tenant to Landlord on demand as additional Rent, plus 18%
per annum interest from date of payment by Landlord. If Landlord
performs any maintenance or repairs to the Premises, as provided
herein, or at the request of Tenant, over and above the services
required to be performed by Landlord pursuant to Paragraph 7, Tenant
shall pay the actual cost thereof, plus an administrative fee equal to
10% of the actual cost thereof, to Landlord as additional Rent within
5 business days after demand.
(c) Landlord agrees to maintain the Project in a condition at least
equal to its current condition and in a fashion substantially similar
to other comparable office buildings in the Plano submarket.
14. Alterations and Additions by Tenant.
(a) Tenant may not make or permit any alterations, improvements, or
additions in or to the Premises or the Project without Landlord's
prior consent. Notwithstanding the foregoing, Tenant shall be
permitted to make such nonstructural improvements in the Premises only
to the extent the costs of the same do not exceed more than $5,000.00
during any twelve (12) month period so long as such improvements are
nonstructural in nature and such improvements do not materially alter
the appearance of the Premises as the same appeared following
completion of the Tenant Finish Work. All alterations, additions, and
improvements made to, or fixtures or other improvements placed in or
upon, the Premises, whether temporary or permanent in character, by
either party (except only movable office furniture and equipment not
attached to the Building) are a part of the Project and are the
property of Landlord when they are placed in the Premises without
compensation to Tenant.
(b) Any alterations and improvements constructed by Tenant must comply
with all Applicable Laws (defined below), including without
limitation, all applicable environmental laws and the Americans With
Disabilities Act of 1990 (ADA). If Tenant's use of the Premises causes
Landlord to make any alterations or improvements to the Project to
comply with the provisions of ADA, Tenant shall reimburse Landlord for
the cost of the alterations or improvements, plus an administrative
fee equal to 10 % of the actual cost thereof, upon demand as
additional Rent. Neither Landlord's approval of Tenant's plans and
specifications for the alterations or improvements nor Landlord's
acceptance of Tenant's as-built plans is a confirmation or agreement
by Landlord that the improvements and alterations comply with
Applicable Laws.
15. Use and Occupancy.
The Premises may be used and occupied by Tenant only for general
business offices. Tenant shall use and maintain the Premises in a
clean, careful, safe, and proper manner and shall comply with all
laws, ordinances, orders, rules, and regulations ("APPLICABLE LAW") of
all governmental bodies (state, federal, and municipal) applicable to
or having jurisdiction over Tenant's particular use, occupancy, and
maintenance of the Premises and the Rules and Regulations attached
hereto and incorporated herein for all purposes; provided, Tenant
shall not be obligated to make structural modifications to the
Premises or the Project or remove hazardous substances which existed
on the Premises prior to the date of this Lease.
16. Parking.
(a) During the initial Lease Term, Landlord shall provide, at no
additional charge to Tenant, no more than 90 undesignated parking
spaces, with not more than an additional 10 parking spaces, if, as and
when available, as determined by Landlord, in areas specified by
Landlord. Tenant must deliver to Landlord a list of the automobile
license numbers of Tenant's employees who will be using such Parking.
(b) Tenant is not assigned designated parking spaces, but is permitted
to use whatever unreserved stalls are available, on a first-come,
first-served basis in areas of the parking lots and/or garage
designated from time to time by Landlord. If for any reason Landlord
fails or is unable to provide parking spaces to Tenant or parking
spaces are not available for use by Tenant Parties, this failure or
inability is not a default by Landlord under this Lease.
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(c) All Tenant Parties must comply with all traffic, security, safety,
and other rules and regulations promulgated from time to time with
respect to the parking area.
17. Mechanics' Liens.
Tenant may not cause or permit any mechanic's or materialman's lien to
be placed upon Landlord's interest in the Project or the Premises or
any part thereof by any contractor, subcontractor, laborer, or
materialman performing any labor or furnishing any materials to Tenant
for any improvement, alteration, or repair of or to the Premises, the
Project, or any part thereof. If as a result of Tenant's use or
occupancy of the Premises any lien is filed on Landlord's interest or
Tenant's interest in the Premises, Tenant shall cause the same to be
discharged within 20 days after filing. If Tenant does not discharge
the lien within the 20-day period, then, in addition to any other
right or remedy of Landlord, Landlord may, but is not obligated to,
discharge the lien by paying the amount claimed to be due or by
procuring the discharge of the lien by deposit in court or bonding.
Any amount paid by Landlord relating to any lien not caused by
Landlord, and all reasonable legal and other expenses of Landlord,
including reasonable attorneys' fees, in defending any action or in
procuring the discharge of any lien, with interest thereon at the rate
of 18% per annum from the date of payment by Landlord, is payable by
Tenant to Landlord on demand as additional Rent.
18. Liability of Landlord.
(a) Except for the gross negligence or intentional misconduct of the
Landlord, its agents, employees or contractors, Landlord is not liable
to Tenant, any Tenant Party, or any other person for any injury or
damage to person or property due to: (i) the Project or related
improvements or appurtenances being out of repair, or defects in or
failure of pipes or wiring, or backing up of drains, or the bursting
or leaking of pipes, faucets, and plumbing fixtures, or gas, water,
steam, electricity, or oil leaking, escaping, or flowing into the
Premises; (ii) any loss or damage caused by the acts or omissions of
other tenants in the Project or of any other persons; or (iii) any
loss or damage to property or person occasioned by theft, fire, act of
God, public enemy, injunction, riot, insurrection, war, court order,
requisition, or order of governmental authority, or any other cause
beyond the control of Landlord. All personal property at the Premises
is at the sole risk of Tenant.
(b) Notwithstanding the foregoing or anything else to the contrary
contained in this Lease, the liability of Landlord to Tenant for any
default or indemnity by Landlord under this Lease is limited to the
interest of Landlord in the Project. Neither Landlord nor any partner,
employee, agent, director, or officer of Landlord has any personal
liability for any amounts payable or obligations performable by
Landlord under this Lease.
19. Tenant's Indemnification of Landlord.
(a) Tenant shall indemnify, defend, and hold Landlord harmless from
all fines, suits, losses, costs, liabilities, claims, demands,
actions, and judgments of every kind and character by reason of any
breach by Tenant under this Lease and all claims, demands, actions,
damages, losses, costs, liabilities, expenses, and judgments suffered
by, recovered from, or asserted against Landlord (i) due to injury or
damage to person or property to the extent that the damage or injury
is caused, by strict liability, negligence, or misconduct of Tenant or
any Tenant Party, or (ii) when the injury or damage is the result, of
the violation by Tenant or any Tenant Party of any law, ordinance, or
governmental order of any kind; or (iii) when the injury or damage
occurring in the Premises in any other way arises out of the occupancy
or use by Tenant or any Tenant Party of the Premises or the Project,
including Landlord's negligence.
(b) Tenant is not required to indemnify, defend, or hold Landlord
harmless from any claim, demand, fine, suit, loss, liability, action
or judgment arising from Landlord's gross negligence or willful
misconduct.
(c) Except in the event of any action by Tenant against Landlord and
subject to pro rata reimbursement by Landlord to Tenant, to the extent
Landlord is ultimately found liable by a court of competent
jurisdiction, if Landlord is made a party to any litigation commenced
by or against Tenant or relating to this Lease or to the Premises,
then Tenant shall pay all costs and expenses, including attorneys'
fees and court costs, incurred by or imposed upon Landlord by virtue
of the litigation. The amount of all costs and expenses, including
attorney's fees and court costs, is a demand obligation bearing
interest at the rate of 18% per annum from the date of payment by
Landlord payable by Tenant to Landlord as additional Rent.
OFFICE LEASE Page 8
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20. Tenant's Insurance.
(a) Tenant shall, at its expense, maintain at all times a policy or
policies of insurance insuring Tenant against all liability for injury
to or death of a person or persons and for damage to or destruction of
property occasioned by or arising out of or in connection with the use
or occupancy of the Premises or by the condition of the Premises
(including Tenant's contractual liability to indemnify and defend
Landlord) with a combined single limit of $2,000,000.00 for bodily
injury and property damages, or with other limits as may be reasonably
required by Landlord. Tenant's policies must be written by an
insurance company or companies reasonably satisfactory to Landlord and
licensed to do business in the State of Texas with an A.M. Best rating
of A-IX, or better, with Landlord and Landlord's Agent, Harwood
Pacific Corporation, named as additional insureds without restriction.
If Tenant has an umbrella or excess policy, Tenant shall name Landlord
and Landlord's Agent as additional insureds without restriction on all
layers of umbrella or excess policies. Tenant shall obtain a written
obligation on the part of each insurance company to notify Landlord at
least 30 days prior to cancellation of the insurance.
(b) Tenant shall deliver copies of its insurance policies or duly
executed certificates of insurance to Landlord prior to occupying any
part of the Premises. Tenant shall deliver satisfactory evidence of
renewals of the insurance policies to Landlord at least 30 days prior
to the expiration of the respective policies. If Tenant fails to
comply with these insurance requirements, Landlord may obtain the
insurance and Tenant shall pay to Landlord on demand as additional
Rent the premium cost thereof plus interest at the rate of 18 % per
annum from the date of payment by Landlord.
21. Landlord's Insurance.
Landlord shall carry, or cause to be carried: (A) public liability
insurance with limits of liability of not less than $1,000,000.00 for
personal injury or death arising out of any one occurrence; and (B)
insurance for fire, extended coverage, vandalism and malicious
mischief, insuring the Project, including the Premises and all
appurtenances thereto, excluding Tenant's merchandise, trade fixtures,
furnishings, equipment, personal property, and any alterations or
additions made by Tenant. Tenant has no interest in any insurance
policies carried by Landlord.
22. Rights Reserved by Landlord.
Landlord reserves the following rights, exercisable without notice and
without liability to Tenant for damage or injury to property, persons,
or business and without effecting an eviction, constructive or actual,
or disturbance of Tenant's use or possession or giving rise to any
claim for set-off or abatement of Rent:
(a) To change the Building's or the Project's name or street address.
(b) To install, affix, and maintain any signs on the exterior and
interior of the Project.
(c) To designate and approve, prior to installation, all types of
window shades, blinds, drapes, awnings, window ventilators, and
similar equipment, and to control all internal lighting that is
visible from the exterior of the Project.
(d) To designate, restrict, and control all sources within the Project
where Tenant may obtain ice, drinking water, towels, toilet supplies,
catering, food and beverages, and like or other services on the
Premises and, in general, the exclusive right to designate, limit,
restrict, and control any business and any service in or to the
Project and its tenants; provided, however, the same does not
unreasonably interfere with Tenant's ability to conduct its business
in the Premises. Furthermore, Tenant shall have the right to install
vending and ice machines in the Premises for Tenant's use.
(e) To enter upon the Premises at reasonable hours to inspect, clean,
or make repairs or alterations to the Premises (but without any
obligation to do so, except as expressly specified in this Lease), to
make repairs or alterations to any part of the Building or the
Building systems, to show the Premises to prospective lenders,
purchasers, and, during the last 12 months of the Lease Term, to show
the Premises to prospective tenants at reasonable hours and, if the
Premises are vacant, to prepare them for re-occupancy, upon advance
telephonic notice under the circumstances and provided the same does
not unreasonably interfere with Tenant's ability to conduct its
business in the Premises.
(f) To retain at all times, and to use in appropriate instances, keys
to all doors within and into the Premises. No locks may be changed or
added without the prior consent of Landlord.
OFFICE LEASE Page 9
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(g) To decorate and make repairs, alterations, additions, changes, or
improvements, whether structural or otherwise, in and about the
Project, and for those purposes to enter upon the Premises and, during
the continuance of the work, temporarily close doors, entry ways,
public space, and corridors in the Project, to interrupt or
temporarily suspend Project services and facilities, and to change the
arrangement and location of entrances or passageways, doors and
doorways, corridors, elevators, stairs, toilets, or other public parts
of the Project, all without abatement or setoff of Rent or affecting
any of Tenant's obligations under this Lease, so long as the Premises
are reasonably accessible; provided, however the same does not
unreasonably interfere with Tenant's ability to conduct its business
in the Premises; provided, further, in the event Landlord's actions
prevent Tenant from conducting its business in the Premises for
seventy-two (72) consecutive hours, thereafter all Rent and other
charges under the Lease shall abate until Tenant is able to resume its
operations in the Premises.
(h) To have and retain a paramount title to the Premises and the
Project free and clear of any act of Tenant purporting to burden or
encumber the Premises or the Project.
(i) To grant to anyone the exclusive right to conduct any business or
render any service in or to the Project, provided the exclusive right
does not operate to exclude Tenant from the uses expressly permitted
in this Lease.
(j) To approve the weight, size, and location of safes and other
heavy equipment and articles in and about the Premises and the Project
and to require all those items and furniture and similar items to be
moved into and out of the Project and the Premises only at times and
in a manner specified by Landlord. Movements of Tenant's property into
or out of the Project and within the Project are entirely at the risk
and responsibility of Tenant. To require permits before allowing
Tenant's property to be moved into or out of the Project.
(k) To have access for Landlord and other tenants in the Project to
any mail chutes or other depositories located on the Premises
according to the rules of the United States Postal Service.
(1) To take reasonable measures as Landlord deems advisable for the
security of the Project and its occupants including, without
limitation, the search of all persons entering or leaving the Project,
the evacuation of the Project for cause, suspected cause, or for drill
purposes, the temporary denial of access to the Project, and the
closing of the Project after Building Standard Hours, subject to
Tenant's right to admittance when the Project is closed after Building
Standard Hours under reasonable regulations Landlord may prescribe
from time to time.
(m) To transfer, assign, or convey, in whole or in part, the Project
and Landlord's rights under this Lease. If Landlord transfers,
assigns, or conveys its rights under this Lease, Landlord is released
from any further obligations under this Lease and Tenant shall to look
solely to the successor in interest of Landlord for performance of the
obligations of "Landlord" under this Lease.
23. (Intentionally Deleted).
24. Fire or Other Casualty.
(a) If the Premises or any part thereof are damaged by fire or other
casualty, Tenant shall give prompt notice thereof to Landlord. If the
Project or any Building is so damaged by fire or other casualty that
substantial alteration or reconstruction of the Project or any
Building is, in Landlord's sole opinion, required (whether or not the
Premises are damaged) or if any mortgagee under a mortgage or deed of
trust covering the Project requires that the insurance proceeds
payable as a result of the fire or other casualty be used to retire
the mortgage debt, Landlord may, at its sole option, terminate this
Lease by giving Tenant notice of termination within 60 days after the
date of the damage. If Landlord terminates this Lease under this
Paragraph, the Rent abates as of the date of the damage.
(b) If Landlord does not elect to terminate this Lease, Landlord shall
within 75 days after the date of the damage commence to repair and
restore the Project to the extent of insurance proceeds actually
received (except that Landlord is not responsible for delays outside
its control) to substantially the same condition in which it was
immediately prior to the casualty. Landlord is not required to
rebuild, repair, or replace any part of Tenant's furniture or
furnishings or fixtures and equipment removable by Tenant under the
provisions of this Lease. Except for Landlord's gross negligence or
intentional misconduct, Landlord is not liable for any inconvenience
or annoyance to Tenant or injury to the business of Tenant resulting
in any way from casualty damage or the repairs; provided, during the
time and to the extent the Premises are unfit for occupancy, Landlord
shall, either furnish Tenant with comparable office space at
prevailing market rates or a fair diminution of Rent,
OFFICE LEASE Page 10
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the choice of which is at Landlord's sole discretion. Notwithstanding
anything to the contrary contained herein, in the event Landlord
elects to repair and restore the Project and is unable to complete
such repairs so that the Premises are tenantable within one hundred
eighty (180) days following the issuance of the construction permit,
Tenant shall have a one (1) time right to terminate the Lease by
providing Landlord with notice of termination within twenty (20) days
following such one hundred eighty (180) day period. Landlord shall
proceed diligently and in good faith to obtain all required building
permits and to repair such damage to the Premises following Landlord's
election to rebuild.
(c) If the damages are caused by the negligence or willful misconduct
of any Tenant Party, Rent does not abate and Tenant shall pay to
Landlord on demand as additional Rent any damages in excess of the
amount paid by insurance proceeds received by Landlord. Any insurance
carried by Landlord or Tenant against loss or damage to the Project or
to the Premises is for the sole benefit of the party carrying the
insurance and under its sole control.
25. Condemnation.
(a) If all or substantially all of the Project or any Building is
taken for any public or quasi-public use under any governmental law,
ordinance, or regulation or by right of eminent domain or is sold
under threat of condemnation to the condemning authority in lieu of
condemnation, then this Lease terminates as of the date when title or
physical possession of the portion of the Building or Project,
whichever first occurs, is taken by the condemning authority. If less
than all or substantially all of the Project or any Building is taken
or sold, Landlord (whether or not the Premises are affected) may
terminate this Lease by giving notice to Tenant within 60 days after
the right of election accrues, in which event this Lease terminates as
of the date when title or physical possession of the portion of the
Building and Project, whichever first occurs, is taken by the
condemning authority.
(b) If this Lease is not terminated upon any taking or sale of less
than all or substantially all of the Project:
(1) the Rent reduces by an amount representing that part
of the Rent properly allocable to the portion of the
Premises taken or sold; and
(2) Landlord shall, at Landlord's sole expense, restore
the Project to substantially its former condition to
the extent reasonably deemed feasible by Landlord;
provided Landlord's restoration obligation does not
exceed the scope of the work done by Landlord in
originally constructing the Project and installing
tenant finish improvements in the Premises; and
provided further Landlord is not required to spend
for the work an amount in excess of the amount
received by Landlord as compensation or damages (over
and above amounts going to the mortgagee of the
property taken) for the part of the Project so taken.
(c) Landlord is entitled to receive all of the compensation awarded
upon a taking of any part or all of the Project, including any award
for the value of the unexpired Lease Term. Tenant is not entitled to
and expressly waives all claim to any compensation; provided, Tenant
is entitled to receive any award for damages to Tenant's leasehold
improvements, relocation expense or otherwise, provided the same does
not diminish Landlord's award.
26. Taxes on Tenant's Property.
Tenant shall pay, and indemnify, defend, and hold Landlord harmless
against, all taxes levied or assessed against personal property,
furniture, fixtures, or other improvements placed by or for Tenant in
the Premises or if the assessed value of Landlord's property is
increased by inclusion of personal property, furniture, fixtures, or
other improvements placed by or for Tenant in the Premises and
Landlord elects to pay the increased taxes, Tenant shall pay to
Landlord on demand as additional Rent that part of the taxes for which
Tenant is liable under this Paragraph.
27. Waiver of Subrogation.
Each party waives all claims that arise or may arise in its favor
against the other party, or anyone claiming through or under them, by
way of subrogation or otherwise, during the Lease Term or any
extension or renewal thereof, for all losses of, or damage to, any of
its property (whether or not the loss or damage is caused by the fault
or negligence of the other party or anyone for whom the other party is
responsible), which loss or damage is covered by valid and collectible
fire and extended coverage insurance policies, to the extent that the
loss or damage is recovered under the insurance policies. These
waivers are in addition to, and not in limitation of, any other waiver
or release in this Lease with respect to any loss or damage to
property of the parties. Since these mutual waivers preclude the
assignment of any claim by way of subrogation (or otherwise) to an
insurance company (or any other person), each party shall immediately
give each insurance company issuing to it policies of fire and
extended coverage
OFFICE LEASE Page 11
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insurance written notice of the terms of these mutual waivers, and
have the insurance policies properly endorsed, if necessary, to
prevent the invalidation of the insurance coverages by reason of these
waivers.
28. Surrender Upon Termination or Expiration; Holdover.
(a) Upon the Expiration Date or any earlier termination of this Lease,
Tenant shall: (1) surrender to Landlord possession of the Premises in
good repair and condition, reasonable wear and tear and damages or
destruction by any condemnation or casualty (unless caused by Tenant)
excepted, and (2) deliver to Landlord all keys to the Premises and all
parking access cards. If Tenant does not immediately surrender
possession, Landlord may enter upon and take possession of the
Premises and expel or remove Tenant and any other person who may be
occupying the Premises, or any part thereof, by force if necessary,
without having any civil or criminal liability therefor.
(b) If Tenant or any of its successors in interest continues to hold
any part of the Premises after the termination of this Lease, the
holding over is a tenancy from month-to-month at a monthly rental
equal to 150 % of the monthly Base Rent payable at the time of
termination, plus the payment of all other Rent payable under this
Lease. While Tenant or its successor continues to hold the Premises
after the termination of this Lease, the month-to-month tenancy is
subject to all terms of this Lease; provided, all expansion rights,
rights of first refusal, first notice, and first offer, and all
extension rights automatically terminate.
(c) No payments of money by Tenant to Landlord after the termination
of this Lease reinstate, continue, or extend the Lease Term and no
extension of this Lease after the termination or expiration thereof is
valid unless it is reduced to writing and signed by Landlord and
Tenant. Nothing in this Paragraph may be construed to give Tenant the
right to hold over beyond the Expiration Date or any earlier
termination of this Lease or preclude Landlord from having the right
to dispossess or otherwise terminate Tenant's right of possession.
Any month-to-month tenancy is terminable at any time upon 30 days
notice from Landlord.
29. Tenant's Property.
(a) All furniture, movable trade fixtures, and equipment installed by
Tenant remains the property of Tenant and must be removed by Tenant at
the termination of this Lease. Any removal of Tenant's property must
be accomplished in a good and workmanlike manner so as not to damage
the Premises or the Project. Tenant, or Landlord at Tenant's expense,
shall repair any damage to the Premises or the Project caused by any
removal. All furniture, movable trade fixtures, and equipment
installed by Tenant not removed within 15 days after termination of
the Lease are conclusively presumed to be abandoned by Tenant.
(b) Upon request of Landlord, Tenant shall also remove, at Tenant's
sole cost, any improvements installed by Tenant without the consent of
Landlord.
30. Events of Default.
The following are events of default ("EVENTS OF DEFAULT") by Tenant
under this Lease:
(a) Tenant fails to pay any Rent when due and the failure continues
[after notice from Landlord] for a period of ten (10) days, provided
Landlord has no obligation to give notice of the failure to pay Rent
more than two (2) times in any twelve (12) month period.
(b) Tenant fails to comply with any of the terms of this Lease, other
than the payment of Rent, and does not cure or commence to cure and
diligently pursue the same to completion within thirty (30) days after
Landlord delivers notice of the failure to Tenant.
(c) Tenant or Guarantor becomes insolvent, makes a transfer in fraud
of creditors, commits any act of bankruptcy, makes an assignment for
the benefit of creditors, or admits in writing its inability to pay
its debts as they become due.
(d) Tenant or Guarantor files a petition under any section or chapter
of the Bankruptcy Code of the United States, as amended, or under any
similar law or statute of the United States or any state thereof, or
Tenant or Guarantor is adjudged
OFFICE LEASE Page 12
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bankrupt or insolvent in proceedings filed against Tenant or
Guarantor, or a petition or answer proposing the adjudication of
Tenant or Guarantor as a bankrupt or its reorganization under any
present or future federal or state bankruptcy or similar law is filed
in any court and the petition or answer is not discharged or denied
within 120 days after filing.
(e) A receiver or trustee is appointed for all or substantially all of
the assets of Tenant or Guarantor or of the Premises or of any of
Tenant's property located therein in any proceeding brought by Tenant
or Guarantor, or any receiver or trustee is appointed in any
proceeding brought against Tenant or Guarantor and is not discharged
within 60 days after appointment or Tenant or Guarantor shall consent
to or acquiesce in the appointment.
(f) Tenant, if a natural person, dies or becomes incapacitated or, if
Tenant is not a natural person, Tenant is dissolved or ceases to
exist.
(g) Tenant's leasehold estate is taken on execution or other process
of law in any action against Tenant.
(h) Tenant fails to possess the Premises within thirty (30) days of
the Ready for Occupancy Date (provided no Rent abatement shall occur),
or thereafter abandons or vacates any portion of the Premises, or
ceases to use the Premises for the Permitted Use or takes any action,
as determined by Landlord, which evidences an intent to abandon or
vacate the Premises.
31. Landlord's Remedies.
If an Event of Default occurs, Landlord may then or any time
thereafter while the Event of Default continues pursue any one or more
of the following remedies:
(a) Terminate this Lease by giving notice to Tenant, in which event
Tenant shall immediately surrender the Premises to Landlord. If Tenant
fails to surrender the Premises, Landlord may, without prejudice to
any other remedy, take possession of the Premises and expel or remove
Tenant and any other person occupying the Premises, or any part
thereof, without being liable for prosecution or any claim of damages.
Tenant shall pay to Landlord on demand as additional Rent the amount
of all loss and damage Landlord suffers by reason of the termination,
whether through inability to re-let the Premises on satisfactory terms
or otherwise. Without limiting the generality of the foregoing, Tenant
shall pay to Landlord on demand the sum of (x) all Rent accrued
hereunder through the date of termination, (y) an amount equal to the
total Rent that Tenant would have been required to pay for the
remainder of the Lease Term discounted to present value at a per annum
rate equal to the discount rate of the Federal Reserve Bank of Dallas
plus one percent (1%), and (z) the amount of all other loss and damage
Landlord suffers by reason of the termination, reduced by the then
present fair rental value of the Premises for such period, similarly
discounted. Landlord has no duty to re-let the Premises. Landlord's
damages specifically include, but are not limited to: (1) all
reasonable expenses necessary to re-let the Premises including the
cost of renovating, repairing, and altering the Premises for a new
tenant or tenants (not to exceed building standard), advertisements,
and brokerage fees; and (2) any increase in insurance premiums caused
by the vacancy of the Premises. Nothing in this Lease limits
Landlord's right to prove and obtain in bankruptcy or insolvency
proceedings damages by reason of the termination of this Lease in an
amount equal to the maximum allowed by any statute or rule of law in
effect at the time when the damages are to be proved, whether or not
the amount is greater, equal to, or less than the amount of the loss
or damages referred to above.
(b) Take possession of the Premises and remove Tenant or any other
person occupying the Premises, or any part thereof, without having any
civil or criminal liability and without terminating this Lease.
Landlord may (but is under no obligation to) re-let the Premises or
any part thereof for the account of Tenant and on conditions and for
uses as Landlord in its sole discretion may determine. Landlord may
collect and receive any rents payable by reason of any re-letting.
Tenant will be liable for all Rent accrued hereunder through the date
Landlord takes possession and all Rent and other sums required to be
paid by Tenant during the remainder of the Lease Term, reduced by any
net sums thereafter received by Landlord through reletting the
Premises during such period. Actions to collect the amount due by
Tenant under the preceding sentence may be brought from time to time
by Landlord, on one or more occasions, without the necessity of
Landlord's waiting until the expiration of the Lease Term; Landlord
may also elect to accelerate the amount due by Tenant under the
preceding sentence, with the amount due by Tenant discounted to
present value using the method provided in subparagraph (a), reduced
by the then present fair rental value of the Premises for such period,
similarly discounted. Tenant shall pay Landlord on demand as
additional Rent all reasonable expenses necessary to re-let the
Premises, which includes the cost of renovating, repairing, and
altering the Premises for a new tenant or tenants, advertisements, and
brokerage fees, as well as any deficiency that may arise by reason of
the re-letting. Landlord is not liable for any failure to re-let the
Premises or any part thereof or for any failure to collect any Rent
due upon any re-letting. No taking of possession of the Premises by
Landlord is an election on Landlord's part to terminate this Lease
unless a notice of termination is given to Tenant under subparagraph
(a).
OFFICE LEASE Page 13
18
(c) Enter upon the Premises without having any civil or criminal
liability and do whatever Tenant is obligated to do under the terms of
this Lease. Tenant shall reimburse Landlord on demand as additional
Rent for any expenses Landlord incurs in performing Tenant's
obligations under this Lease, together with interest at the rate of
18% per annum from the date incurred until repaid by Tenant. Landlord
is not liable for any damages resulting to Tenant from Landlord's
actions or omissions in performing Tenant's obligations, whether
caused by the negligence of Landlord or otherwise, but excepting the
gross negligence or intentional misconduct of Landlord.
(d) Landlord may, without further notice of any kind to Tenant,
interrupt or cause the interruption of any utility service serving the
Premises, remove, alter, or change any door, window, attic hatchway
cover to the Premises, or any lock, latch, hinge, hinge pin, doorknob,
or other mechanism connected to any door, window, or attic hatchway
cover to the Premises, and intentionally prevent Tenant from entering
the Premises, as permitted by applicable law. Landlord is under no
obligation to restore any door, window, or attic hatchway cover or any
lock, latch, hinge, hinge pin, doorknob, or other mechanism attached
thereto or to deliver or make available to Tenant any key to any door,
window, or attic hatchway cover until Tenant fully cures all Events of
Default then existing under this Lease.
No repossession of or re-entering all or any part of the Premises
under subparagraphs (b), (c), or (d) above or otherwise and no re-
letting of the Premises or any part thereof under subparagraph (b)
relieves Tenant or Guarantor of any liabilities or obligations under
this Lease, all of which survive repossession or re-entering by
Landlord. If Landlord repossesses or re-enters all or any part of the
Premises after an Event of Default, Tenant shall pay to Landlord the
Rent required to be paid by Tenant. No right or remedy of Landlord
under this Lease is intended to be exclusive of any other right or
remedy. Each right and remedy of Landlord is cumulative and all other
rights or remedies under this Lease or now or hereafter existing at
law, in equity or by statute. In addition to other remedies provided
in this Lease, Landlord is entitled, to the extent permitted by
applicable law, to injunctive relief in case of the violation, or
attempted or threatened violation, of any of the terms of this Lease,
or to a decree compelling specific performance of the terms of this
Lease.
32. No Implied Waiver.
The failure of Landlord or Tenant to insist at any time upon the
strict performance of any of the terms of this Lease or to exercise
any option, right, power, or remedy contained in this Lease is not a
waiver of the right or remedy for the future. The waiver of any breach
of this Lease or violation of the Rules and Regulations attached to
this Lease does not prevent a subsequent act, which would have
originally constituted a breach or violation, from having all the
force and effect of an original breach or violation. Acceptance by
Landlord of any Rent after the breach of any of the terms of this
Lease or violation of any Rule or Regulation is not a waiver of the
breach or violation, and no waiver by Landlord of any of the terms of
this Lease is effective unless expressed in writing and signed by
Landlord.
33. Waiver by Tenant.
Tenant waives and surrenders for itself and all persons or entities
claiming by, through, and under it, including creditors of all kinds:
(A) any right and privilege which it or any of them has under any
present or future constitution, statute, or rule of law to redeem the
Premises or to have a continuance of this Lease for the Lease Term
after termination of Tenant's right of occupancy by order or judgment
of any court or by any legal process or writ, or under the terms of
this Lease, (B) the benefits of any present or future constitution,
statute, or rule of law that exempts property from liability for debt
or for unpaid Rent, (C) any provision of law relating to notice or
delay in levy of execution in case of eviction of a tenant for
nonpayment of Rent, and (D) any rights, privileges, and liens set out
under Section 91.004 of the Texas Property Code (as amended), and
Tenant exempts Landlord from any liability or duty thereunder.
34. Landlord's Lien.
To secure payment of all Rent and any damages or losses Landlord
suffers by reason of the breach by Tenant of this Lease, Tenant grants
to Landlord a security interest in, and an express contractual lien
on, all goods, wares, equipment, fixtures, furniture, improvements,
and other personal property of Tenant presently or hereafter situated
in the Premises and the Project (except parts of the property
exchanged, replaced, or sold from time to time in the ordinary course
of Tenant's operations) and all proceeds therefrom. The property may
not be removed from the Premises or the Project without the consent of
Landlord until all arrearages in Rent are paid and any other defaults
cured by Tenant. This security interest is governed by Article 9 of
the Texas Business & Commerce Code (the "CODE"). Upon request by
Landlord, Tenant shall execute and deliver to Landlord a financing
statement in form sufficient to perfect the security interest of
Landlord in the property and proceeds under the provisions of the
Code. The security interest granted in this Paragraph is in addition
to Landlord's
OFFICE LEASE Page 14
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statutory and constitutional liens. Landlord agrees to subordinate the
lien created hereunder to a valid, bona-fide third party equipment
lease, purchase money security interest or a loan from a commercial
bank secured by such property.
35. Attorneys' Fees and Legal Expenses.
If either party files litigation concerning the interpretation or
enforcement of this Lease, the prevailing party is entitled to recover
from the losing party the prevailing party's reasonable attorneys'
fees, court costs, and expenses, whether at the trial or appellate
level.
36. Subordination.
(a) This Lease and all rights of Tenant under this Lease are subject
and subordinate to any mortgage or deed of trust secured by a first
lien against the Project, all increases, renewals, modifications,
consolidations, replacements, and extensions of any first lien
mortgage or deed of trust and all leases, restrictions, easements, and
encumbrances recorded in the Real Property Records of Dallas County,
Texas, to the extent they validly affect the Project. Tenant shall,
upon demand at any time or times, execute, acknowledge, and deliver to
Landlord, or to Landlord's first mortgagee, any instruments that may
be necessary or proper to more effectively effect or evidence this
subordination to any first mortgage or first deed of trust.
(b) If any first mortgage or first deed of trust against the Project
is foreclosed, Tenant shall, upon request by the purchaser at the
foreclosure sale attorn to the purchaser and recognize the purchaser
as "Landlord" under this Lease and execute, acknowledge, and deliver
to the purchaser an instrument in appropriate form acknowledging the
attornment.
(c) Tenant waives the provisions of any statute or rule of law, now or
hereafter in effect, that may give or purport to give Tenant any right
or election to terminate or otherwise adversely affect this Lease and
the obligations of Tenant under this Lease if any foreclosure sale
occurs. This Lease is not affected in any way whatsoever by any
foreclosure sale unless the holder(s) of the indebtedness or other
obligations secured by the mortgages or deeds of trust declare
otherwise.
37. Quiet Enjoyment.
If Tenant pays the Rent when due and performs all other obligations of
Tenant under this Lease, then Tenant may peaceably and quietly enjoy
the Premises during the Lease Term without any disturbance from
Landlord or from any other person claiming by, through, or under
Landlord, but not otherwise, subject to the terms of this Lease and of
the deeds of trust, mortgages, ground leases, ordinances, leases,
utility easements, and agreements to which this Lease is subordinate.
38. Notice to Landlord.
If any act or omission by Landlord occurs that would give Tenant the
right to damages from Landlord or the right to terminate this Lease
due to constructive or actual eviction from all or part of the
Premises or otherwise, Tenant may not sue for damages or exercise any
right to terminate until (A) it gives notice of the act or omission to
Landlord and Landlord's first mortgagee, if any, and (B) a reasonable
period of time for remedying the act or omission elapses following the
giving of the notice, during which time Landlord, its agents,
employees, and first mortgagee are entitled to enter the Premises and
cure the act or omission. During the period after the giving of the
notice and during the curing of the act or omission, the Rent payable
by Tenant abates only to the extent that any part of the Premises is
untenantable.
39. Rules and Regulations.
All Tenant Parties must comply with the Rules and Regulations (as
changed from time to time as hereinafter provided) attached as EXHIBIT
D which shall be consistently applied to all tenants. Landlord may at
any time change the Rules and Regulations or promulgate other Rules
and Regulations as Landlord deems advisable for the safety, care,
cleanliness, or orderliness of the Project. No changes are effective
until a copy of the changes is delivered to Tenant. Tenant is
responsible for the compliance with the Rules and Regulations by all
Tenant Parties. Landlord shall use reasonable efforts to enforce
compliance by all other tenants with the Rules and Regulations from
time to time in effect, but Landlord is not responsible to Tenant for
failure of any person to comply with the Rules and Regulations.
OFFICE LEASE Page 15
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40. Estoppel Certificate.
Tenant shall, from time to time upon not less than 15 days' prior
notice by Landlord, execute, acknowledge, and deliver to Landlord an
Estoppel Certificate in substantially the form attached as EXHIBIT F.
41. Notices.
All notices, requests, approvals, and other communications required or
permitted to be delivered under this Lease must be in writing and are
effective on the business day sent if delivered by telecopier or
facsimile; or 3 days after being deposited in the United States mail,
certified, return receipt requested, postage prepaid; or upon receipt
if delivered personally or by any method other than by telecopier
(with written confirmation) or mail, in each instance addressed to
Landlord or Tenant, as the case may be, at the address specified in
Paragraph I of this Lease, or to any other address either party may
designate by 10 days' prior notice to the other party.
42. Hazardous Materials.
(a) Tenant may not cause or permit the escape, disposal, or release in
the Premises or the Project of any biologically active, chemically
active, or hazardous substances or materials (collectively, "HAZARDOUS
SUBSTANCES") or bring, or permit any other Tenant Party to bring, any
hazardous substances into the Premises or the Project. The term
HAZARDOUS SUBSTANCES includes, but is not limited to, those described
in the Comprehensive Environmental Response Compensation and Liability
Act of 1980, as amended, 42 U.S.C. Section 9601 et seq., the Resource
Conservation and Recovery Act, as amended, 42 U.S.C. Section 6901 et
seq., the Texas Water Code, the Texas Solid Waste Disposal Act, and
other applicable state or local environmental laws and the regulations
adopted under those acts.
(b) If any lender or governmental agency requires testing to ascertain
whether or not a release of hazardous substances has occurred in or on
the Premises or the Project based on probable cause that a release
occurred and was caused by any Tenant Party, then Tenant shall
reimburse the reasonable costs of the testing to Landlord on demand as
additional Rent if it is determined that any Tenant Party caused such
release of the hazardous substance. Tenant shall execute affidavits,
representations, and the like from time to time at Landlord's request
concerning Tenant's best knowledge and belief regarding the presence
of hazardous substances in the Premises and the Project. Tenant shall
indemnify Landlord in the manner elsewhere provided in this Lease from
any release of hazardous substances in or on the Premises or the
Project caused by any Tenant Party. These covenants survive the
expiration or earlier termination of this Lease.
(c) To Landlord's actual current knowledge, without independent
investigation or inquiry, as of the date of this Lease, Landlord has
complied with all environmental laws with respect to the Premises and
the Project.
43. Business Purpose.
Tenant represents that this Lease is executed by Tenant, and all
obligations of Tenant arising out of this Lease are, primarily for
business or commercial purposes and not for personal, family, or
household purposes.
44. Severability.
Each of the terms of this Lease is, and must be construed to be,
separate and independent. If any of the terms of this Lease or its
application to any person or circumstances is to any extent invalid
and unenforceable, the remainder of this Lease, or the application of
that term to persons or circumstances other than those as to which it
is invalid or unenforceable, are not affected thereby.
45. No Merger.
The fact that the same person may acquire or hold, directly or
indirectly, this Lease or the leasehold estate hereby created or any
interest in this Lease or in the leasehold estate as well as the fee
estate in the Premises or any interest in the fee estate does not
cause a merger of this Lease or of the leasehold estate hereby created
with the fee estate in the Premises.
OFFICE LEASE Page 16
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46. Force Majeure.
When this Lease prescribes a period of time for action to be taken by
either Landlord or Tenant, such party shall not be lia- ble or
responsible for, and there shall be excluded from the computation for
the period of time, any delays due to strikes, acts of God, shortages
of labor or materials, war, governmental laws, regulations,
restrictions, or any other cause of any kind that is beyond the
control of such party.
47. Brokerage.
Landlord and Tenant each warrant that it has had no dealings with any
broker or agent in connection with the negotiation or execution of
this Lease other than Tenant's Broker and Landlord's Agent
(collectively, "BROKERS"). Landlord and Tenant shall each indemnify,
defend, and hold the other harmless against all costs, expenses,
attorneys' fees, or other liability for commissions or other
compensation or charges claimed by any broker or agent other than
Brokers claiming by, through, or under such party with respect to this
Lease or any renewal or extension or with respect to any expansion of
the Premises. Any brokerage commissions payable to Brokers are payable
by Landlord pursuant to the terms of separate agreements between
Landlord and Brokers.
48. Gender.
Words of any gender used in this Lease include any other gender and
words in the singular number include the plural, unless the context
otherwise requires.
49. Joint and Several Liability.
If there is more than one Tenant, the obligations imposed upon Tenant
under this Lease are joint and several.
50. No Representations.
Landlord or Landlord's agents made no representations or promises with
respect to the Premises or the Project except as expressly set forth
in this Lease. No rights, easements, or licenses are acquired by
Tenant by implication or otherwise except as expressly set forth in
this Lease.
51. Entire Agreement; Amendments.
This Lease is the entire agreement between the parties. All
negotiations, considerations, representations, and understandings
between Landlord and Tenant are incorporated in this Lease. No act or
omission of any employee or agent of Landlord or of Landlord's Broker
may alter, change, or modify any of the terms of this Lease. No
amendment or modification of this Lease is binding unless expressed in
a written instrument executed by Landlord and Tenant.
52. Paragraph Headings.
The paragraph headings in this Lease are for convenience only and in
no way enlarge or limit the scope or meaning of the paragraphs in this
Lease.
53. Binding Effect.
All terms of this Lease are binding upon the respective heirs,
personal representatives, successors, and, to the extent assignment is
permitted, assigns of Landlord and Tenant.
54. Exhibits.
The following exhibits are attached to and made a part of this Lease:
EXHIBIT A Land, B Premises, C Tenant Finish Construction, D Project
Rules and Regulations, E Contractor Insurance Requirements, F Right
of First Notice and Certificate of Ready for Occupancy Date.
OFFICE LEASE Page 17
22
55. Counterparts.
This Lease may be executed in two or more counterparts, each of which
is deemed an original and all of which together constitute one and the
same instrument.
56. Tenant's Service Providers.
Tenant shall cause all moving companies and other entities providing
services to Tenant in the Premises to deliver evidence satisfactory to
Landlord that the insurance specified in EXHIBIT E is in force prior
to entering the Project.
57. Rate of Interest.
It is agreed that all interest chargeable under this Lease shall under
no circumstances exceed the maximum amount of interest permitted by
applicable law. If the rate of interest specified in this Lease shall
ever be greater than the maximum amount of interest permitted by
applicable law, then the rate of interest chargeable under this Lease
shall be the maximum amount of interest permitted by applicable law.
58. Right of First Notice.
(a) If during the initial Lease Term the space described on EXHIBIT F
attached to this Lease (the FIRST NOTICE SPACE) is available for lease
and Landlord receives an expression of interest in the First Notice
Space from a prospective tenant, Landlord shall deliver a notice to
Tenant offering to lease the First Notice Space to Tenant. Landlord's
notice must specify the First Notice Rate (defined below). The term
AVAILABLE FOR LEASE means that the First Notice Space is not then
subject to any existing rights of third parties, including, without
limitation, rights of first notice, expansion rights, extension
rights, options to lease, or other rights.
(b) Tenant may elect to lease the First Notice Space by delivering a
notice (the RESPONSE NOTICE) to Landlord within 5 days after the date
of Landlord's notice specifying that Tenant elects either (1) to lease
all, but not less than all, of the First Notice Space or (2) to
decline to lease the First Notice Space.
(c) If (1) Landlord does not receive the Response Notice within the
5-day period or (2) in the Response Notice Tenant does not elect to
lease all of the First Notice Space, Tenant is deemed to waive its
right to lease the First Notice Space and Tenant has no further rights
to the First Notice until the same becomes available for lease.
(d) If Tenant timely delivers a Response Notice electing to lease all
of the First Notice Space, Tenant's lease of the First Notice Space
commences 30 days after Landlord's receipt of the Response Notice
(unless Landlord and Tenant agree on a different commencement date)
and is on the same terms as this Lease except that the Rent and other
applicable terms for the First Notice Space adjust based on the First
Notice Rate. Landlord shall prepare, and Landlord and Tenant will
execute and deliver, within 10 days after Landlord's receipt of the
Response Notice, an amendment to the Lease adding the First Notice
Space to the Premises upon the terms specified in this Paragraph.
(e) Landlord is not obligated to offer the First Notice Space to
Tenant, and Tenant may not exercise its option to lease the First
Notice Space, if at the time Landlord would otherwise be obligated to
give the Notice to Tenant, Tenant is in default under this Lease or
has previously been a default under this Lease two (2) or more times.
(f) The term FIRST NOTICE RATE means the Base Rent, parking,
refurbishment allowance, brokerage commissions and other inducements
that Landlord quotes for the First Notice Space for a term equal to
the remainder of the Lease Term, as determined by Landlord in its sole
discretion. Notwithstanding the forgoing, if the First Notice Space
becomes available for lease and Tenant executes a lease amendment for
the same within twelve (12) months following the date of this Lease,
the First Notice Rate shall be equal to the Annual Base Rental, as set
forth the schedule in Paragraph 1 hereof.
(g) Tenant may not assign this option to lease the First Notice Space
to any assignee of the Lease, nor may any sublessee or assignee
exercise this option.
OFFICE LEASE Page 18
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59. Signage.
Notwithstanding anything to the contrary contained herein, Tenant
shall have a limited right to exterior monument signage in an area to
be designated by Landlord ("Signage"), subject to Landlord's approval,
in its sole discretion, as to design, location, and installation of
such Signage. Tenant shall have a one time right to placement of the
Signage, at Tenant's sole cost and expense and in compliance with all
applicable laws and ordinances, at the commencement of the Term
provided Tenant has given Landlord 30 days advance written notice
requesting the Signage. Following Tenant's notice to Landlord, Tenant
shall submit plans and specifications to Landlord detailing the design
and installation of the Signage for Landlord's approval. Following
Landlord's approval, Tenant shall obtain all necessary approvals and
permits in compliance with all applicable laws. Tenant shall install
the Signage using a contractor acceptable to Landlord. Tenant shall
maintain the Signage subject to Landlord's reasonable requirements at
Tenant's sole cost and expense and shall be responsible for the cost
of removing the same upon the expiration or earlier termination of the
Lease.
60. Execution and Approval of Lease.
Employees and agents of Landlord and of Landlord's Broker have no
authority to make or agree to make a lease or any other agreement or
undertaking in connection herewith. The submission of this Lease for
examination and negotiation is not an offer to lease, agreement to
reserve, or option to lease the Premises. This Lease is effective and
binding on Landlord only upon the execution and delivery of this Lease
by Landlord and Tenant. If Landlord's first mortgagee requires any
modifications of the terms of this Lease as a condition to approving
this Lease, other than a modification of the Base Rent, Tenant shall
execute and deliver any required modifications within 10 days after
receipt of Landlord's demand.
61. Cabling Allowance.
Tenant shall receive up to $1.00 per rentable square foot for computer
and telephone cabling. Any amount not used for cabling will not be
paid to Tenant.
62. Rental Abatement.
Landlord grants Tenant four (4) months of rental abatement to offset
their relocation costs.
63. Security System Installation.
Tenant shall have the right to install their own security system at
their own expense but Tenant shall be allowed to tie it into the
existing building security system.
This Lease is executed in multiple originals as of the date
first above set forth.
LANDLORD:
TGALMA Limited,
a Texas Limited Partnership
By: Harwood Pacific Corporation,
its Authorized Agent
By: /s/ DOUG WALKER
---------------------------
Name: Doug Walker
Title: General Manager, Harwood
Pacific Corporation
TENANT:
Credentials Services International, Inc.,
a California Corporation
By: /s/ NICK REES
-------------------------------------
Name: Nick Rees
Title: President
OFFICE LEASE Page 19
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EXHIBIT A
to Office Lease by and between
TGALMA Limited, a Texas Limited Partnership, as Landlord
and
Credentials Services International, Inc., a California Corporation, as Tenant
THE LAND
(LAND DESCRIPTION IS ATTACHED AS PAGE 2 OF 2)
OFFICE LEASE
EXHIBIT A Page 1 of 1 /S/DW/JNR
25
EXHIBIT A
LEGAL DESCRIPTION
THE LAND REFERRED TO HEREIN IS SITUATED IN THE COUNTY OF COLLIN. STATE OF
TEXAS, AND IS DESCRIBED AS FOLLOWS:
TRACT 1:
BEING ALL OF LOT 1 in BLOCK I of HARRINGTON CENTER, an Addition to the City of
Plano, Texas, according to the Map thereof recorded in Volume C, Page 315, of
the Map Records of Collin County, Texas, situated in the Joseph Klepper Survey,
Abstract No. 213, in the City of Plano, Collin County, Texas, said tract being a
part of a 20.038 acre tract of land described in a deed from Bernice S.
Underwood, et al., to Andrew G. Fenney, et al., recorded in Volume 873, Page
500, of the Deed Records, Collin County, Texas; said tract being more
particularly described as follows:
COMMENCING at a point on the new East line of Alma Drive (100' R.O.W.), said
point being 50.00 feet East of the centerline and being 331.95 feet west of the
Northwest corner of Stone Pony Apartments Volume 8, Page 5, Plat Records,
Collin County);
THENCE, North 00 degrees 11 minutes 44 seconds West, along the East line of
Alma Drive, a distance of 36.67 feet to the POINT OF BEGINNING;
THENCE, North 00 degrees 11 minutes 44 seconds West, along the East line of
Alma Drive, a distance of 280.00 feet to a point for corner;
THENCE, North 90 degrees 00 minutes 00 seconds East, a distance of 399.38 feet
to a point for corner;
THENCE, South 00 degrees 00 minutes 00 seconds East, a distance of 292.00 feet
to a point for corner;
THENCE, South 90 degrees 00 minutes 00 seconds West, a distance of 345.78 feet
to a point for corner;
THENCE, North 77 degrees 09 minutes 38 seconds West, a distance of 54.00 feet to
a POINT OF BEGINNING AND CONTAINING 116,158 square feet or 2.666 acres of land,
more or less.
/s/ DW/JNR
26
EXHIBIT B
to Office Lease by and between
TGALMA Limited, a Texas Limited Partnership, as Landlord
and
Credentials Services International, Inc., a California Corporation, as Tenant
(FLOOR PLAN OF THE PREMISES IS ATTACHED AS EXHIBIT B AS PAGE 2 OF 2)
OFFICE LEASE /s/ DW/JNR
EXHIBIT B Page 1 of 1
27
EXHIBIT B
THE PREMISES
[floor plan]
/s/DW/JNR
28
EXHIBIT C
to Office Lease by and between
TGALMA Limited, a Texas Limited Partnership, as Landlord,
and
Credentials Services International, Inc., a California Corporation, as Tenant
TENANT FINISH CONSTRUCTION
A. LANDLORD WORK: Landlord shall construct or cause to be constructed the
following work ("Landlord Work") according to the pricing plan
attached hereto and incorporated herein as Schedule C-1 (the
"Construction Documents"). All Landlord Work performed under the
Pricing Plan and/or Construction Documents shall be at building
standard. Tenant shall be obligated for any Additional Work, as
provided below.
B. PLANS AND SPECIFICATIONS: Tenant shall submit to Landlord, within 5
days after the date of this Lease, space plan(s) and other information
(collectively the Space Plan) necessary or required by Landlord to
complete the initial plans and specifications (the Initial
Construction Documents) for the construction of the Landlord Work in
the Premises [pursuant to the Pricing Plan and/or Construction
Documents]. Landlord shall prepare and submit the Initial Construction
Documents to Tenant for Tenant's approval as soon as practical after
receiving the Space Plan.
Within 5 days after receipt of the Initial Construction
Documents, Tenant shall deliver to Landlord a notice either approving
or disapproving them. Any disapproval must specify in reasonable
detail the reasons for the disapproval. If Tenant requests any changes
in the Initial Construction Documents that vary from the Pricing
and/or Plan, any redrawing is at Tenant's expense. If Landlord does
not receive a notice from Tenant disapproving the Initial Construction
Documents within the 5-day period, Tenant is deemed to approve the
Initial Construction Documents. Any redrawing of or changes in the
Initial Construction Documents requested by Tenant after Tenant's
initial approval is at Tenant's expense.
If the Initial Construction Documents have not been approved
by Landlord and Tenant within 30 days after the date of this Lease,
Landlord may terminate this Lease by giving notice to Tenant.
The approved Initial Construction Documents are referred to as
the Construction Documents and all work to be performed by Landlord
pursuant to the Construction Documents is referred to as the Tenant
Finish Work.
C. ADDITIONAL WORK: If Landlord performs, at Tenant's request and upon
submission by Tenant and approval by Landlord of necessary plans and
specifications (as approved, the Additional Work Plans), any work over
and above the Landlord Work and/or the Tenant Finish Work (Additional
Work), including any Additional Work approved by change order or work
order, the Additional Work is at Tenant's expense, regardless of any
remaining balance of the Work Allowance. Landlord is not obligated to
perform any Additional Work until Tenant pays Landlord the Actual Cost
of the Additional Work, as estimated by Landlord. If the Actual Cost
of the Additional Work exceeds the estimated amount paid by Tenant,
Tenant shall pay the excess to Landlord.
The Additional Work is not part of the Tenant Finish Work. If
Landlord agrees to perform any Additional Work, Landlord shall request
that its contractor estimate the additional amount of time that will
be added to the completion of the Tenant Finish Work because of the
Additional Work (the Additional Work Period). This estimate is
conclusive and binding on Landlord and Tenant for the purpose of
establishing the Ready for Occupancy Date.
D. DELAYS: If Landlord is delayed in substantially completing the Tenant
Finish Work or any Additional Work as a result of:
(1) Tenant's failure to promptly and timely furnish any information
required by Landlord;
Page l of 2
OFFICE LEASE /s/DW/JNR
EXHIBIT C
29
(2) Tenant's delay in approving the Construction Documents or in
submitting any Additional Work Plans or in modifying the Additional
Work Plans as required by Landlord;
(3) Tenant's request for materials, finishes, or installations other
than Landlord's Building standard items or long lead items;
(4) Tenant's changes in the Construction Documents or any Additional
Work Plans; or
(5) interference with Landlord's work by any Tenant Party;
then the Ready for Occupancy Date is accelerated by the number of days
of Tenant delays.
E. EARLY ENTRY: Upon request by Tenant, Landlord shall permit Tenant and
its contractors to enter the Premises prior to the Ready for Occupancy
Date, in order that Tenant may perform through its own contractor(s)
(who must be approved by Landlord) other work and decorations Tenant
wants in the Premises while Landlord's contractors are working. This
license to enter prior to the Ready for Occupancy Date is subject to
the following conditions:
(1) Tenant's contractor(s) must work in harmony and not interfere
with Landlord's contractors and subcontractors; and
(2) Tenant must deliver evidence to Landlord of compliance with the
requirements of EXHIBIT E prior to commencement of the work by
Tenant's contractor(s).
Landlord may revoke this license upon 48 hours' notice to
Tenant if the entry causes disharmony or interference with the Tenant
Finish Work.
Landlord is not liable in any way for any injury, loss, or
damage that occurs to any of Tenant's decorations or installations
made prior to the Ready for Occupancy Date, the entry being solely at
Tenant's risk. Tenant shall indemnify, defend, and hold Landlord
harmless from any claims, demands, actions, losses, and damages
arising from activities of Tenant's contractors, workers, and
mechanics.
F. PAYMENTS BY TENANT: Any and all amounts payable by Tenant under this
EXHIBIT C are payable to Landlord as additional Rent within 10 days
after Tenant's receipt of Landlord's demand.
OFFICE LEASE
EXHIBIT C Page 2 of 2 /s/DW/JNR
30
EXHIBIT D
to Office Lease by and between
TGALMA Limited, a Texas Limited Partnership, as Landlord,
and
Credentials Services International, Inc., a California Corporation, as Tenant
RULES AND REGULATIONS
1. Tenant's use and occupancy of the Premises shall be subject to the
following:
(a) Tenant may not deface or injure the Premises or the Project or any
part thereof or overload the floors of the Premises. Tenant may not
commit waste or permit waste to be committed or cause or permit any
nuisance on or in the Premises or the Project. Tenant shall pay
Landlord on demand as additional Rent for any damage to the Premises
or to any other part of the Project caused by any negligence or
willful act or any misuse or abuse (whether or not the misuse or abuse
results from negligence or willful acts) by Tenant or any Tenant Party
or any other person (except Landlord or any of its agents, employees,
or contractors) not prohibited by Tenant from entering upon the
Premises.
(b) Tenant may not use or allow the Premises to be used for any
purpose prohibited by any Applicable Law, or by any restrictive
covenants applicable to the Project. Tenant shall conduct its business
and occupy the Premises and control all Tenant Parties so as not to
create any nuisance or interfere with, annoy, or disturb any other
tenants in the Project or Landlord in its management of the Project
and so as not to injure the reputation of the Project.
(c) Tenant may not erect, place, or allow to be placed any sign,
advertising matter, stand, booth, or showcase in or upon the
doorsteps, vestibules, halls, corridors, doors, walls, windows, or
pavement of the Project (except for lettering on the door or doors to
the Premises as allowed by the Rules and Regulations attached as
EXHIBIT D) without the prior consent of Landlord.
(d) Tenant may not use or allow or permit the Premises to be used in
any way or for any purpose that:
(1) Landlord deems hazardous on account of the
possibility of fire or other casualty;
(2) increases the rate of fire or other insurance for
the Project or its contents or in respect of the
operation of the Project; or
(3) renders the Project uninsurable at normal rates by
responsible insurance carriers authorized to do
business in the State of Texas or renders void or
voidable any insurance on the Project.
If insurance premiums are increased because of Tenant's use of
the Premises, then, in addition to any other remedies Landlord
may have, Tenant shall pay the amount of the increase to
Landlord as additional Rent within 5 days after demand.
2. No birds, animals, reptiles, or any other creatures may be brought
into or about the Project.
3. Nothing may be swept or thrown into the corridors, halls, elevator
shafts, or stairways.
4. Tenant may not make or permit any improper noises in the Building,
create a nuisance, or do or permit anything which, in Landlord's sole
judgment, interferes in any way with other tenants or persons having
business with them.
5. No equipment of any kind may be operated on the Premises that could in
any way annoy any other tenant in the Building.
6. Tenant shall cooperate with Building employees in keeping the Premises
neat and clean.
OFFICE LEASE
EXHIBIT D Page 1 of 5 /s/ DW/JNR
31
7. Corridor doors, when not in use, must be kept closed.
8. No bicycles or similar vehicles are allowed in the Building.
Alterations, improvements, and additions in and to the Premises
requested by Tenant must be made in accordance with plans and
specifications approved in advance by Landlord. All work must be
performed at Tenant's expense either by Landlord or by contractors and
subcontractors approved in advance by Landlord. If the work is not
performed by Landlord, then all work performed by Tenant's contractors
and subcontractors is subject to the following conditions:
(a) Each contractor and subcontractor must deliver evidence
satisfactory to Landlord that the insurance specified on EXHIBIT E is
in force prior to commencing work.
(b) Tenant shall ensure that all workers are cooperative with Project
personnel and comply with all Project Rules and Regulations.
(c) Tenant must deliver to Landlord evidence that Tenant has obtained
all necessary governmental permits and approvals for the improvements
or alterations prior to starting any work.
(d) All construction must be done in a good and workmanlike manner and
is subject to approval by Landlord during and after construction, in
its sole discretion.
(e) Lien releases from each contractor and subcontractor must be
submitted to Landlord within 5 days after completion of the work
performed by the contractor or subcontractor.
(f) Within 30 days after completion of any improvements or
alterations, Tenant, at its cost, shall deliver to Landlord 2
reproducible copies of "as-built" plans and specifications (1/8"
scale) for each floor where alterations or improvements were made.
10. Tenant shall refer all contractors, contractor's representatives, and
installation technicians rendering any service on or to the Premises
for Tenant to Landlord for Landlord's approval and supervision for
performance of any contractual service. This provision applies to all
work performed in the Building, including installation of telephones,
telephone equipment, electrical devices, and attachments and
installations of any nature affecting floors, walls, woodwork, trim,
windows, ceiling, equipment, or any other physical portion of the
Building.
11. No nails, hooks, or screws may be driven into or inserted in any part
of the Building except by Building maintenance personnel.
12. Sidewalks, doorways, vestibules, halls, stairways, and similar areas
may not be obstructed by any Tenant Party, or used for any purpose
other than ingress and egress to and from the Premises, or for going
from one part of the Building to another part of the Building. No
furniture may be placed in front of the Building or in any lobby or
corridor without prior consent of Landlord.
13. Any Tenant Party who desires to enter the Building after Building
Standard Hours, is required to sign in upon entry and sign out upon
leaving, giving the location during their stay and their time of
arrival and departure.
14. All deliveries must be made via the service entrance and service
elevator during normal working hours or at other times as Landlord may
determine. Prior approval must be obtained from the Landlord for all
deliveries that must be received after Building Standard Hours.
15. Landlord or its agents or employees may enter the Premises to examine
the same or to make repairs, alterations, or additions as Landlord
deems necessary for the safety, preservation, or improvement of the
Building.
16. Landlord may require all Tenant Parties to evacuate the Building in
the event of an emergency or catastrophe.
OFFICE LEASE
EXHIBIT D Page 2 of 5 /s/ DW/JNR
32
17. Tenant may not do anything, or permit anything to be done, in or about
the Building, or bring or keep anything in the Building that in any
way increases the possibility of fire or other casualty, or do
anything in conflict with the valid laws, rules, or regulations of any
governmental authority.
18. No food may be distributed from Tenant's office without the prior
approval of the Building Manager.
19. No additional locks may be placed on any doors without the prior
consent of Landlord. All necessary keys must be furnished by Landlord
and must be surrendered to Landlord upon termination of this Lease.
Tenant shall then give Landlord the combination for all locks on the
doors and vaults.
20. Tenant shall comply with parking rules and regulations as may be
posted and distributed from time to time.
21. Plumbing and appliances may be used only for the purposes for which
constructed. No sweeping, rubbish, rags, or other unsuitable material
may be thrown or placed therein. Any stoppage or damage resulting to
any fixtures or appliances from misuse by any Tenant or Party is
payable by Tenant.
22. No signs, posters, advertisements, or notices may be painted or
affixed on any windows, doors, or other parts of the Building, except
in colors, sizes, and styles, and in places, approved in advance by
Landlord. Landlord has no obligation or duty to give this approval.
Building standard suite identification signs will be prepared by a
sign writer approved by Landlord. The cost of the Building standard
signs is payable by Tenant. Landlord may remove all unapproved signs
without notice to Tenant, at the expense of Tenant. Directories will
be placed by Landlord, at Landlord's expense, in conspicuous places in
the Building. No other directories are permitted.
23. No portion of the Building may be used as lodging rooms or for any
immoral or unlawful purposes.
24. Tenant may not operate, or allow the operation of any coin or token
operated vending machine or similar device for the sale of any goods,
wares, merchandise, food, beverages, or services, including but not
limited to pay lockers, pay toilets, scales, amusement devices and
machines for the sale of beverages, foods, candy, cigarettes or other
commodities, without the prior consent of Landlord.
25. Tenant must obtain Landlord's prior approval, which is at Landlord's
sole discretion, for installation of any solar screen material, window
shades, blinds, drapes, awnings, window ventilators, or other similar
equipment and any window treatment of any kind whatsoever. Landlord
may control all internal lighting that is visible from the exterior of
the Building and may change any unapproved lighting without notice to
Tenant, at Tenant's expense.
26. Holidays are New Year's Day, Memorial Day, Independence Day, Labor
Day, Thanksgiving, and Christmas. Business days are weekdays other
than holidays.
27. Tenant shall at all times keep a chair pad under every chair that has
rollers and is located in a carpeted area.
28. Tenant shall not permit any of its Tenant Party to hold, carry, smoke,
or dispose of a lighted cigar, cigarette, pipe, or any other lighted
smoking equipment in any common area of the Buildings, unless
designated as a "smoking" area by Landlord. The common areas includes,
but are not limited to, all rest rooms, common corridors, stairwells,
elevator lobbies, first floor lobbies, and other areas used in common
with other tenants and occupants of the Buildings.
29. Tenant shall notify the Building Manager when any furnishings or
equipment are to be taken into or out of the Building. Moving of
those items must be done under the supervision of the Building
Manager, after receiving approval from Landlord.
30. Landlord may prescribe the weight and position of safes and other
heavy equipment that may overstress any portion of the floor. All
damage done to the Building by the improper placing of heavy items
that overstress the floor will be repaired at the sole expense of the
Tenant.
31. The persons employed to move Tenant's equipment, material, furniture,
or other property in or out of the building must be acceptable to
Landlord. The moving company must be a locally recognized professional
mover, whose primary business is the performing of relocation
services, and must be bonded and fully insured. A certificate or other
verification of such insurance must be received and approved by
Landlord prior to the start of any moving operations. Insurance must
be
OFFICE LEASE
Page 3 of 5 /s/ DW/JNR
EXHIBIT D
33
sufficient, in Landlord's sole opinion, to cover all personal
liability, theft or damage to the project, including but not limited
to floor coverings, doors, walls, elevators, stairs, foliage, and
landscaping. Special care must be taken to prevent damage to foliage
and landscaping during adverse weather. All moving operations will be
conducted at such times and in such a manner as Landlord will direct,
and all moving will take place during non-business hours unless
Landlord agrees in writing otherwise. Tenant will be responsible for
the provision of building security during all moving operations, and
will be liable for all losses and damages sustained by any party as a
result of the failure to supply adequate security. Landlord will have
the right to prescribe the weight, size, and position of all
equipment, materials, furniture, or other property brought into the
building. Heavy objects will, if considered necessary by Landlord,
stand on wood strips of such thickness as is necessary to properly
distribute the weight. Special care must be taken so as to prevent
damage to the floor coverings and elevators in the Building. Landlord
will not be responsible for loss of or damage to any such property
from any cause, and all damage done to the building by moving or
maintaining such property will be repaired at the expense of Tenant.
Landlord reserves the right to inspect all such property to be brought
into the building and to exclude from the building all such property
which violates any of these rules and regulations or the lease of
which these rules and regulations are a part. Supplies, goods,
materials, packages, furniture, and all other items of every kind
delivered to or taken from the premises will be delivered or removed
through the entrance and route designated by Landlord, and Landlord
will not be responsible for the loss or damage of any such property
unless such loss or damage results from the negligence of Landlord,
its agents, or employees.
32. Landlord will have the right to prohibit any advertising by Tenant
mentioning the building that, in Landlords reasonable opinion, tends
to impair the reputation of the building or its desirability as a
building for offices, and upon written notice from Landlord, Tenant
will refrain from or discontinue such advertising.
33. Each Tenant will store all its trash and garbage within its premises.
No material will be placed in the trash boxes or receptacles if such
material is of such nature that it may not be disposed of in the
ordinary and customary manner of removing and disposing of trash and
garbage without being in violation of any law or ordinance governing
such disposal. All garbage and refuse disposal will be made only
through entryways and elevators provided for such purposes and at such
times as Landlord designates. Removal of any furniture or furnishings,
large equipment, packing crates, packing materials, and boxes will be
the responsibility of each Tenant and such items may not be disposed
of in the building trash receptacles nor will they be removed by the
building's janitorial service, except at Landlord's sole option and at
the Tenant's expense. No furniture, appliances, equipment, or
flammable products of any type may be disposed of in the building
trash receptacles.
34. Canvassing, peddling, soliciting, and distributing handbills or any
other written materials in the building are prohibited, and each
Tenant will cooperate to prevent the same.
35. No picketing may be conducted at or within the Building.
36. The requirements of the Tenants will be attended to only upon
application by written, personal, or telephone notice at the office of
the building. Employees of Landlord will not perform any work or do
anything outside of their regular duties unless under special
instructions from Landlord.
37. A directory of the building will be provided for the display of the
name and location of Tenants only and such reasonable number of the
principal officers and employees of Tenants as Landlord in its sole
discretion approves, but landlord will not in any event be obligated
to furnish more than one (1) directory strip for each Tenant. Any
additional names(s) that Tenant desires to place in such directory
must first be approved by Landlord, and if so approved, Tenant will
pay to Landlord a charge, set by Landlord, for each such additional
name. All entries on the building directory display will conform to
standards and style set by Landlord in its sole discretion. Space on
any exterior signage will be provided in Landlord's sole discretion.
No Tenant will have any right to the use of any exterior sign.
38. Tenant may not use space heaters without the prior consent of
Landlord. Tenant will see that the doors of the premises are closed
and locked and that all space heaters (if their use is approved by
Landlord), coffee pots, water faucets, water apparatus, and utilities
are shut off before Tenant or Tenant's employees leave the premises,
so as to prevent waste or damage, and for any default or carelessness
in this regard Tenant will make good all injuries sustained by other
Tenants or occupants of the building or Landlord. On multiple-tenancy
floors, all Tenants will keep the doors to the building corridors
closed at all times except for ingress and egress.
39. Neither Landlord nor any operator of the parking areas within the
project, as the same are designated and modified by Landlord, in its
sole discretion, from time to time (the "parking areas") will be
liable for loss of or damage to any vehicle or any contents of such
vehicle or accessories to any such vehicle, or any property left in
any of the parking areas, resulting
OFFICE LEASE
EXHIBIT D Page 4 of 5 /s/DW/JNR
34
from fire, theft, vandalism, accident, conduct of other users of the
parking areas and other persons, or any other casualty or cause.
Further, Tenant understands and agrees that: (a) Landlord will not be
obligated to provide any traffic control, security protection or
operator for the parking areas; (b) Tenant uses the parking areas at
its own risk; and (c) Landlord will not be liable for personal injury
or death, or theft, loss of, or damage to property. Tenant waives and
releases Landlord from any and all liability arising out of the use of
the parking areas by Tenant, its employees, agents, invitees, and
visitors, whether brought by any of such persons or any other person.
40. Tenant (including Tenant's employees, agents, invitees, and visitors)
will use the parking spaces solely for the purpose of parking
passenger model cars, small vans, and small trucks and will comply in
all respects with any rules and regulations that may be promulgated by
Landlord from time to time with respect to the parking areas. The
parking areas may be used by Tenant, its agents, or employees, for
occasional overnight parking of vehicles. Tenant will ensure that any
vehicle parked in any of the parking spaces will be kept in proper
repair and will not leak excessive amounts of oil or grease or any
amount of gasoline. If any of the parking spaces are at any time used
(a) for any purpose other than parking as provided above; (b) in any
way or manner reasonably objectionable to Landlord; or (c) by Tenant
after default by Tenant under the lease, Landlord, in addition to any
other rights otherwise available to Landlord, may consider such
default any event of default under the lease.
41. Tenant's right to use the parking areas will be in common with other
Tenants of the project and with other parties permitted by Landlord to
use the parking areas. Landlord reserves the right to assign and
reassign, from time to time, particular parking spaces for use by
persons selected by Landlord. Landlord will not be liable to Tenant
for any unavailability of Tenant's designated spaces, if any, nor will
any unavailability entitle Tenant to any refund, deduction, or
allowance. Tenant will not park in any numbered space or any space
designated as: RESERVED, HANDICAPPED, VISITORS ONLY, or LIMITED TIME
PARKING (or similar designation).
42. Landlord may rescind any of these Rules and Regulations and make other
future Rules and Regulations as in the judgment of Landlord are from
time to time needed for the safety, protection, care, and cleanliness
of the Building, the operation thereof, the preservation of good order
therein, and the protection and comfort of its tenants, their agents,
employees, and invitees. Those rules, when made and notice thereof
given to a tenant, are binding upon the Tenant in the same manner as
the original rules.
OFFICE LEASE
EXHIBIT D Page 5 of 5 /s/DW/JNR
35
EXHIBIT E
to Office Lease by and between
TGALMA Limited, a Texas Limited Partnership, as Landlord,
and
Credentials Services International, Inc., a California Corporation, as Tenant
CONTRACTOR INSURANCE REQUIREMENTS
All contractors, subcontractors, suppliers, service providers, moving
companies, and others performing work of any type for Tenant in the Project
shall:
- carry the insurance listed below with companies with an A.M.
Best rating of A-IX, or better, and otherwise acceptable to
Landlord; and
- furnish Certificates of Insurance to Landlord evidencing
required coverages at least 10 days prior to entry in the
Project and Renewal Certificates at least 30 days prior to the
expiration dates of Certificates previously furnished.
Certificates of Insurance must provide for 30 days' prior written notice of
cancellation or material change to Landlord, c/o Harwood Pacific Corporation,
2651 North Harwood, Suite 450, Dallas, Texas 75201, Attention: Property
Manager.
1. Workers Compensation: Statutory workers compensation insurance
covering full liability under applicable Workers Compensation Laws at
the required statutory limits.
Employers' Liability: Employers' liability insurance with the
following minimum limits of liability:
$100,000 Each Accident
$500,000 Disease-Policy Limit
$100,000 Disease-Each Employee
3. Commercial General Liability: This insurance policy must:
a. Be written on a standard liability policy form (sometimes
known as commercial general liability insurance) but without
exclusionary endorsements that may delete coverage for
products/completed operations, personal and advertising
injury, blanket contractual, fire legal liability, or medical
payments.
b. Be endorsed to provide that:
- aggregate limits, if any, apply separately to each of
the insured's jobs or projects away from premises
owned by or rented to the insured;
- the insurance is primary and non-contributory to any
insurance provided by Landlord; and
- include the following minimum limits:
$1,000,000 General Aggregate
$1,000,000 Products-Completed Operations Aggregate
$1,000,000 Personal & Advertising Injury
$1,000,000 Each Occurrence
$ 50,000 Fire Damage (Any one fire)
$ 5,000 Medical Expense (Any one person)
OFFICE LEASE
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36
4. Automobile Liability: Automobile liability insurance for claims of
ownership, maintenance, or use of owned, non-owned, and hired motor
vehicles at, upon, or away from the Project with the following minimum
limits:
$500,000 Combined Single Limit Bodily Injury and
Property Damage per Occurrence
5. Excess Liability: Following form excess liability insurance with
coverages at least as broad as the required commercial general
liability insurance with the following minimum limits:
$1,000,000 Each Occurrence
$2,000,000 Aggregate
6. General Requirements: All policies must be:
- written on an occurrence and not on a claims-made basis;
- endorsed to name as additional insureds Landlord, Manager, and
their respective officers, directors, employees, agents,
partners, and assigns;
- endorsed to waive any rights of subrogation against Landlord,
Manager, and their respective officers, directors, employees,
agents, partners, and assigns; and
- primary and non-contributing with, and not in excess of, any
other insurance available to Tenant, Landlord, Manager or any
other entity named as an additional insured).
OFFICE LEASE
EXHIBIT E Page 2 of 2 /s/DW/JNR
37
EXHIBIT F
to Office Lease by and between
TGALMA Limited, a Texas Limited Partnership, as Landlord,
and
Credentials Services International, Inc., a California Corporation, as Tenant
(THE FLOOR PLAN OF THE FIRST NOTICE SPACE IS ATTACHED AS PAGE 2 OF 2)
OFFICE LEASE
EXHIBIT F Page 1 of 1 /s/DW/JNR
38
EXHIBIT F
RIGHT OF FIRST NOTICE
[FLOOR PLAN]
/s/DW/JNR
39
CERTIFICATE OF READY FOR OCCUPANCY DATE
The undersigned, Landlord and Tenant under a Lease (the "Lease") dated
____________________, 1995 for premises located at 1700 Alma, Ste. ____, Plano,
Texas 75075, desire to execute this certificate to evidence their agreement
that the "Ready for Occupancy Date" under the Lease occurred on
______________________, 1995, [and the "Expiration Date" is
_______________________, 199__,] notwithstanding anything to the contrary in
the Lease. In all other respects the Lease is ratified and confirmed.
EXECUTED as of __________________, 1995
LANDLORD
_________________________________________
By:______________________________________
Doug Walker
Its: General Manager
TENANT
Credentials Services International, Inc.,
a California Corporation
By:______________________________________
Its:_____________________________________