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LEASE AGREEMENT
BETWEEN
MOTHER GOOSE CORPORATION,
AS LANDLORD
AND
PRECISE MACHINE PARTNERS, L.L.P.,
AS TENANT
2205 and 2215 RIVER HILL ROAD
DALLAS, TEXAS
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TABLE OF CONTENTS
Section Page No.
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1. Definitions and Basic Provisions..............................1
2. Lease of Premises.............................................2
2A. Option to Renew...............................................2
3. Payments and Performance......................................3
4. Absolute Net Lease; Non-Terminability.........................4
5. Taxes and Assessments.........................................6
6. Compliance with Law; Environmental Matters....................7
7. Indemnification...............................................9
8. Required Insurance...........................................10
9. Fire or Other Casualty.......................................13
10. Repairs and Reentry..........................................14
11. Assignment and Subletting....................................14
12. Alterations and Additions by Tenant..........................16
13. Legal Use; Violations of Insurance Coverage; Nuisance........16
14. Laws and Regulations.........................................16
15. Rules of the Premises........................................16
16. Entry for Repairs and Inspection.............................17
17. Condemnation.................................................17
18. Landlord's Lien..............................................18
19. Abandoned Property...........................................18
20. Holding Over.................................................18
21. Entire Agreement and Amendment; No Representations
or Warranties; No Memorandum of Lease.......................18
22. Transfer of Landlord's Rights................................19
23. Default......................................................19
24. Remedies; Attorney's Fees....................................23
25. Quiet Possession.............................................24
26. Severability.................................................24
27. Security Deposit.............................................24
28. No Subrogation...............................................24
29. Binding Effect...............................................24
30. Notices......................................................25
31. Brokerage....................................................25
32. Subordination; Nondisturbance................................25
33. Estoppel Certificates; Financial Statements..................26
34. [Intentionally deleted]......................................27
35. Premises Name and Address....................................27
36. Mechanic's Liens.............................................27
37. INTENTIONALLY DELETED........................................27
38. Constructive Eviction........................................27
39. Personal Liability...........................................27
40. [Intentionally Deleted]......................................27
41. No Waiver....................................................28
42. No Third Party Beneficiary...................................28
43. Number and Gender............................................28
44. Force Majeure................................................28
45. Applicable Law, Consent to Jurisdiction......................28
Exhibit "A" Legal Description
Exhibit "B" Buildings Rules and Regulations
LEASE AGREEMENT
THIS LEASE AGREE (the "Lease") is made and entered into as of the 25th
day of August 1998, by and between the Landlord and Tenant hereinafter named.
1. Definitions and Basic Provisions. The terms defined below shall have
the respective meanings stated when used elsewhere in this Lease, and such terms
and the following basic provisions constitute an integral part of this Lease:
(a) "Landlord": Mother Goose Corporation, a Texas corporation.
(b) "Tenant": Precise Machine Partners, L.L.P., a Texas
limited liability partnership.
(c) "Premises": Landlord's land described on Exhibit "A"
attached hereto and made a part hereof, together with all buildings,
improvements, fixtures, rights, easements and appurtenances benefiting
or appertaining thereto, and commonly referred to as 2205 River Hill
Road and 2215 River Hill Road, Dallas, Texas, 75061. Said Premises are
deemed to contain a total of 8,400 square feet of Rentable Space, as
follows:
2205 River Hill Road 6,000 square feet
2215 River Hill Road 2,400 square feet
(d) "Lease Term": The Lease is for a term of two (2) years,
commencing on August 25, 1998 (the "Commencement Date") and ending on
August 24, 2000.
(e) "Monthly Rent": The total monthly rental fee of $3,750
which Tenant agrees to pay to Landlord at 1247 Shady Bend, Dallas,
Texas, 75244 (or at such place as Landlord from time to time may
designate in writing) in advance and, without demand on the first (1st)
day of each calendar month during and throughout the Lease Term.
(f) "Security Deposit": $7,500.00.
(g) "Sole Permitted Use": Design, fabrication and assembly of
metal parts and components for use in aerospace and other industry and
general office use, subject to the other provisions hereof.
(h) "Leasing Agent": None.
(i) "Rentable Space": All floor area of the Premises, being
8,400 square feet.
(j) "Exhibits": The following Exhibits are attached to and
made a part of this Lease for all purposes:
Exhibit "A" - Legal Description of the Premises
Exhibit "B" - Premises Rules and Regulations
(k) "Impositions": All taxes (as limited by Section 5 below),
costs, expenses, obligations, assessments or impositions of every kind
or nature whatsoever which may be levied, assessed, charged or imposed
upon the Premises and the business carried on therein which may arise
or become due during the Term of this Lease, unless otherwise expressly
provided in this Lease. The term "Impositions" shall not include any
federal income taxes, state and local taxes, federal excess profit
taxes, franchise, capital stock and federal or state estate or
inheritance taxes of Landlord.
(l) "Renewal Terms": Two successive terms of five (5) years
each, commencing on the next day following the last day of the then
immediately preceding term.
2. Lease of Premises. In consideration of the obligation of Tenant to
pay rent as herein provided and in consideration of the other terms, covenants,
and conditions hereof Landlord hereby demises and leases to Tenant, and Tenant
hereby leases and takes from Landlord, the Premises for the Lease Term specified
herein and, upon proper and timely exercise of Tenant's options to renew as
described in Section 2A hereof, for each Renewal Term, all upon and subject to
the terms and conditions set forth herein. This Lease and the obligations of
Landlord hereunder are conditioned upon faithful performance by Tenant of all of
the agreements and covenants herein set out and agreed to by Tenant.
2A. Option to Renew. Landlord hereby grants to Tenant the option to
renew this Lease for two (2) successive five (5) year Renewal Terms provided
that (a) Tenant provides to Landlord written notice of its exercise of the
option to renew no fewer than 180 days prior to the expiration of the then
current Term of this Lease, and (b) Tenant is not in uncured default under this
Lease at the time it gives notice of its exercise of the option to renew or
during any interval between providing such notice and the commencement of the
applicable Renewal Term. This option to renew shall not be assigned or
transferred in any manner to any subtenant or assignee of Tenant without
Landlord's written consent in Landlord's sole and absolute discretion, and shall
at the option of Landlord terminate upon such assignment or sublet if not
previously exercised.
Upon timely and proper notification and exercise by Tenant of its
option to renew, all of the terms and conditions of this Lease shall remain in
full force and effect throughout the ensuing Renewal Term; provided, however,
that the Monthly Rent payable hereunder shall, at Landlord's option be adjusted
on the first day of such Renewal Term and subsequently as hereinafter set out.
Promptly following timely and proper notification and exercise by
Tenant of its option to renew, Tenant and Landlord shall, if Landlord so elects,
jointly contact the North Texas Chapter of the Appraisal Institute (the
"Chapter"), whose current address and particulars are P.O. Box 801807, Dallas,
Texas, 75380-1807, Telephone 972-233-2244, Facsimile 972-239-6857, E-Mail
ntexasai@airealworks.com. Landlord and Tenant shall contact the Chapter in a
writing signed by both of them. The writing shall request that the Chapter
select a neutral Member of the Appraisal Institute ("MAI') to determine the fair
market rental rate of the Premises. The writing shall request that the Chapter
notify Landlord and Tenant in writing of the MAI appraiser selected by the
Chapter. In the event that the Appraisal Institute no longer has a North Texas
Chapter, Landlord and Tenant shall choose a comparable appraisal organization
reasonably acceptable to both of them.
Landlord and Tenant shall jointly contact such appraiser and instruct
him to determine the fair market rental rate for the Premises as of the time of
the expiration of the then-current Lease Term. The cost of such appraisal shall
be jointly borne by Landlord and Tenant. The appraiser shall be instructed to
provide the fair market rate in writing and within 30 days. The rate set in such
appraisal shall be final.
Within 30 days following its receipt of the said appraiser's report but
in no case less than 60 days prior to the expiration of the then applicable
Lease Term, Tenant shall inform Landlord in writing of its decision to renew
this Lease or vacate the Premises by the expiration of such Lease Term.
During any Renewal Term, beginning on the first day of the 31st month
of such term, the Monthly Rent shall escalate or decrease for the remainder of
such Renewal Term by an amount equal to the product of (i) a fraction, the
numerator of which is the CPI for the previous December, and the denominator of
which is the CPI for December immediately prior to the commencement of such
Renewal Term, multiplied by (ii) the Monthly Rental then in effect. As used in
this paragraph, "CPI" means the Consumer Price Index for all Urban Consumers
(All Items and Commodity Groups--Dallas Area Only) (1982-84 = 100). If such
index is changed so that the base year differs from that used as of the
Commencement Date, the CPI shall be converted in accordance with the conversion
factor published by the U.S. Department of Labor, Bureau of Labor Statistics. If
the CPI is discontinued during any Renewal Term, such other successor government
index as may be applicable to the Dallas, Texas metropolitan area shall be used
in order to obtain substantially the same result as would be obtained as if the
CPI had not been discontinued.
3. Payments and Performance. Tenant agrees to pay all rents and sums
provided to be paid by Tenant hereunder at the times and in the manner herein
provided, without any setoff, deduction or counterclaim whatsoever. Should this
Lease commence on a day other than the first day of a calendar month or
terminate on a day other than the last day of a calendar month, the rent for
such partial month shall be proportionately reduced. The Monthly Rent for the
first partial month, if any, shall be payable at the beginning of said period or
as prepaid rental. The obligation of Tenant to pay such rent is an independent
covenant, and no act or circumstance whatsoever, whether such act or
circumstance constitutes a breach of covenant by Landlord or not, shall release
Tenant from the obligation to pay rent as and when the same is due. Time is of
the essence in the performance of all of Tenant's obligations hereunder. Any
amount which becomes owing by Tenant to Landlord hereunder shall bear interest
at the highest lawful rate per annum from the due date until paid, unless there
is no highest lawful rate of interest provided by law with respect to such
amount, in which event such amount shall bear interest at the rate of one and
one-half percent (1-1/2%) per month from the due date until paid.
4. Absolute Net Lease; Non-Terminability.
(a) THIS IS AN ABSOLUTELY NET LEASE TO LANDLORD. It is the
intent of the parties hereto that the Monthly Rent payable under this
Lease shall be an absolutely net return to Landlord and that Tenant
shall pay all Impositions. Any amount or obligation herein relating to
the Premises which is not expressly declared to be that of Landlord
shall be deemed to be an obligation of Tenant to be performed by Tenant
at Tenant's expense, and Tenant agrees to indemnify and save Landlord
harmless from and against the same. Tenant hereby assumes and agrees to
perform all duties and obligations with respect to the Premises, as
well as to the use, operation and maintenance thereof, even though such
duties and obligations would otherwise be construed to be those of the
Landlord. Monthly Rent, additional rent and all other sums payable
hereunder by Tenant shall be paid without notice (except as expressly
provided herein), demand, setoff, counterclaim, abatement, suspension,
deduction or defense.
(b) Landlord hereby represents and warrants to Tenant only
that to Landlord's current, actual knowledge as of the date hereof, (i)
all utilities presently used on and from the Premises are connected to
the Premises and separately metered and (ii) the utility systems on the
Premises are fully operational and in good condition. Tenant shall,
during the Lease Term, pay and discharge as and when the same shall
become due and payable without penalty all water and sewer rents,
rates, and charges, charges for removal of waste materials, and charges
for water, steam, heat, gas, electricity, light, and power, telephone
and cable charges and other service or services furnished to the
Premises or occupants thereof during the Lease Term, and shall
indemnify Landlord against any and all liabilities on such account.
Landlord shall be required to repair and maintain the
structural integrity of the foundation, roof and exterior walls of the
improvements constructed on the Premises. In addition, Landlord shall
be responsible for maintaining in good repair the sewer, water and gas
lines from the exterior boundary of the Premises to the point at which
same enter the improvements constructed on the Premises. Such work will
be performed at Landlord's sole cost and expense unless the damage to
same is caused by the negligence, intentional misconduct or other fault
of Tenant. Except as provided in the preceding sentences of this
subparagraph, Landlord shall not be required to undertake any
maintenance or repairs or furnish any services or facilities to the
Premises whatsoever, and shall not be liable for damages to Tenant due
to any failure of electric current, heating, ventilating or air
conditioning systems, nor for injury or damage to person (including
death) or property caused by or resulting from steam, gas, electricity,
water, heat, or by rain or snow that may flow or leak from or into any
part of the Premises, including but not limited to the walls, roof or
foundation, or from any lines, pipes, appliances, or plumbing works of
the same or from the street or subsurface or from any other place, nor
for interference with light, air or other incorporeal hereditaments or
easements, however caused, unless solely due to the affirmative grossly
negligent acts or intentional malfeasance of Landlord.
If Landlord fails to commence and prosecute in good faith
repairs to items for which it is responsible pursuant to the
subparagraph immediately above within 30 days following Landlord's
receipt of written notice from Tenant (or within such period as is
reasonable under the circumstances in the event of any emergency),
Tenant shall have the option to terminate this Lease by written notice
to Landlord. In the case of an emergency, in the event that the
principal of Landlord is not immediately available (e.g., out of town,
ill or on vacation), Tenant may commence emergency repairs on
Landlord's account, and Landlord shall reimburse Tenant for Tenant's
reasonable, documented out-of-pocket costs as promptly as is possible
under the circumstances.
In the event that any utility service reasonably necessary to
Tenant's permitted uses hereunder shall be interrupted or materially
curtailed for more than five (5) business days for any reason other
than Tenant's failure to pay amounts owed to the applicable utility
service or the negligence, intentional misconduct or other fault of
Tenant, and provided that Tenant (i) immediately notifies Landlord in
writing of such interruption or curtailment and (ii) immediately and in
good faith commences to undertake repairs or take such steps as are
necessary to restore utility service, then Monthly Rent shall be
equitably abated or reimbursed by Landlord beginning after the
expiration of such five (5) business day period.
(c) Except as may otherwise be expressly provided herein, this
Lease shall not terminate, nor shall Tenant have any right to terminate
this Lease, nor shall Tenant be entitled to any abatement or reduction
of rent hereunder, nor shall the obligations of Tenant under this Lease
be affected, by reason of (i) any damage to or destruction of all or
any part of the Premises from whatever cause, (ii) the taking of the
Premises or any portion thereof by condemnation, requisition or
otherwise, (iii) any lawful or unlawful prohibition, limitation or
restriction of Tenant's use of all or any part of the Premises, or any
interference with such use by private person, corporation or other
entity, (iv) any eviction by paramount title or otherwise, (v) any
default or breach of any representation, or warranty on the part of
Landlord under this Lease, or under any other agreement to which
Landlord and Tenant may be parties, (vi) the failure of Landlord to
deliver possession of the Premises on the commencement of the term
hereof, (vii) any inconvenience, interruption, cessation, or loss of
business, caused directly or indirectly by any present or future laws,
rules, requirements, orders, directions, ordinances, or regulations of
the United States of America or of the state, county or city
government, or any other municipal government or lawful authority
whatsoever, or by priorities, rationing, or curtailment of labor or
materials or by war or any matter or thing, resulting therefrom, or
(viii) any other cause whether similar or dissimilar to the foregoing,
any present or future law to the contrary notwithstanding. It is the
intention of the parties hereto that the obligations of Tenant
hereunder shall be separate and independent covenants and agreements,
that the Monthly Rent and all other sums payable by Tenant hereunder
shall continue to be payable in all events except as otherwise provided
herein, and that the obligations of Tenant hereunder shall continue
unaffected, unless the requirement to pay or perform the same shall
have been properly terminated pursuant to an express provision of this
Lease, including Sections 4(b) and 9(a), and except to the extent
equitably abated as provided in Section 4(b) or 9(a).
(d) Tenant agrees that it will be obligated under this Lease
in accordance with its terms, and that it will not take any action to
terminate, rescind or avoid this Lease except as may be permitted
pursuant to bankruptcy, insolvency, receivership or reorganization
laws.
(e) Tenant waives all rights which may now or hereafter be
conferred by law to quit, terminate or surrender this Lease or the
Premises or any part thereof or (ii) to abate, suspend, defer or reduce
the Monthly Rent or any other sums payable under this Lease, except as
otherwise expressly provided herein.
5. Taxes and Assessments.
(a) Tenant shall pay or discharge all Impositions when due.
Notwithstanding the foregoing sentence, Tenant shall not be required to
pay any franchise, corporate, estate, inheritance, succession,
transfer, income, excess profits or revenue taxes of Landlord except
any such tax, assessment, charge or levy imposed or levied upon or
assessed against Landlord in substitution for or in place of an
Imposition. Tenant agrees to furnish to Landlord, at least ten (10)
days before said Impositions would otherwise become delinquent,
official receipts evidencing the payment of all Impositions. In the
event that any Imposition levied or assessed against the Premises
becomes due and payable during the Term hereof and may be legally paid
in installments, Tenant shall have the option to pay such Imposition in
installments. In such event, Tenant shall be liable on1y for those
installments which become due and payable during the Term hereof.
(b) If Tenant shall, in good faith, desire to contest the
validity of any such Impositions, Tenant shall have the right to do so
without being in default hereunder provided that Tenant shall give
Landlord prompt written notice of Tenant's intention to institute such
legal proceedings as are appropriate, which proceedings shall be
promptly instituted and conducted in good faith and with due diligence;
such proceedings shall suspend the collection of such Impositions, and
the Premises shall not be in danger of being sold, forfeited, or lost;
and Tenant shall furnish to Landlord or the appropriate governmental
agency with a bond made by a surety company qualified to do business in
the State of Texas, or shall pay cash to a recognized escrow agent in
Dallas County, State of Texas in one and one-half (1-1/2) times the
amount of such Impositions, conditioned to pay such Impositions when
the validity thereof shall have been finally determined, which said
written notice and security shall be given by Tenant to Landlord or the
appropriate governmental agency not fewer than ten (10) days before
such Impositions proposed to be contested, would otherwise become
delinquent and, upon the conclusion of such contest Landlord shall
return to Tenant the security hereinabove required to be deposited by
Tenant, provided that Tenant shall first furnish to Landlord official
receipts evidencing payment of such Impositions.
(c) If Tenant shall fail, refuse, or neglect to make any of
the payments in this Section required prior to the date when a
delinquent rate would be imposed, then Landlord may, at its option and
without wavier of the default thus committed by Tenant, pay same, and
the amount of money so paid, including reasonable attorney's fees and
expenses incurred in connection with such payments, together with
interest on all of such amounts at the lower of the maximum legal rate
or fifteen percent (15%) per annum, shall be repaid by Tenant to
Landlord upon demand, and the payment thereof may be collected by
Landlord in the same manner as though said amount were an installment
of Monthly Rent specifically required by the terms of this Lease to be
paid by Tenant to Landlord.
(d) In the event the financing institution where Landlord has
financing on the Premises shall require Landlord to pay all or any part
of the Impositions and/or the premiums for the Required Insurance (as
defined in Section 8 hereof in monthly installments of one-twelfth
(1/12th) of the annual amount of such Impositions and premiums, then
Tenant shall make to Landlord, in addition to the rent reserved
hereunder, monthly payments of one-twelfth (1/12th) of the amount of
such Impositions and the premiums for the Required Insurance.
(e) Tenant shall be liable for all Impositions levied or
assessed against personal property, furniture or fixtures placed by
Tenant in the Premises. If any such taxes for which Tenant is liable
are levied or assessed against Landlord or Landlord's property and if
Landlord elects to pay the same or if the assessed value of Landlord's
property is increased by inclusion of personal property, furniture or
fixtures placed by Tenant in the Premises, and Landlord elects to pay
the taxes based on such increase, Tenant shall pay Landlord upon demand
that part of such taxes for which Tenant is liable hereunder.
6. Compliance with Law; Environmental Matters.
(a) Landlord shall, at its expense, cause those portions of
the Premises for which Landlord is responsible as specifically
enumerated in Section 4(b) to comply with all governmental statutes,
laws, rules, orders, regulations and ordinances (including, without
limitation. the Americans With Disabilities Act) the failure to comply
with which at any time would affect such portions of the Premises, or
the use thereof. including those which require the making of any
structural, unforeseen or extraordinary changes, whether or not any of
the same involve a change of policy on the part of the body enacting
the same.
Except for those portions of the Premises for which Landlord
is responsible, Tenant shall. at its expense, comply with and shall
cause the Premises to comply with all governmental statutes, laws,
rules, orders, regulations and ordinances (including, without
limitation, the Americans With Disabilities Act) the failure to comply
with which at any time would affect the Premises or any part thereof,
or the use thereof, including those which require the making of any
structural, unforeseen or extraordinary changes, whether or not any of
the same involve a change of policy on the part of the body enacting
the same.
To the current, actual knowledge of Landlord, Landlord has
received no written notice that the Premises are not in compliance with
such statutes, laws, rules, orders, regulations and ordinances, Tenant
shall, at its expense, comply with all changes required in order to
obtain the Required Insurance (as hereinafter defined), and with the
provisions of all contracts, agreements, instruments and restrictions
existing uses or any at the commencement of this Lease or thereafter
suffered or permitted by Tenant affecting the Premises or any part
thereof or the ownership, occupancy or use thereof.
(b) Tenant shall:
(i) not cause, suffer or permit any Hazardous
Material (as defined below) to exist on or discharge from the
Premises (whether originating thereon or migrating to the
Premises from other property), and shall promptly: (A) pay any
claim against Tenant, Landlord, any lender providing financing
to Landlord secured by Landlord's interest in the Premises and
improvements thereon and/or the Lease (hereinafter, "Permitted
Beneficiary") or any claim against the Premises, (B) remove
any charge or lien upon any of the Premises, and (C) defend,
indemnify and hold Landlord and Permitted Beneficiary harmless
from any and all claims, expenses, liability, loss or damage
resulting from any Hazardous Material that exists on or is
discharged from the Premises:
(ii) not cause, suffer or permit any Hazardous
Material to exist on or discharge from any property owned or
used by Tenant which would result in any charge or lien upon
the Premises and shall promptly: (A) pay any claim against
Tenant, Landlord, Permitted Beneficiary or the Premises; (B)
remove any charge or lien upon the Premises; and (C) defend,
indemnify and hold Landlord and Permitted Beneficiary harmless
from any and all claims, expenses. liability, loss or damage,
resulting from the existence of any such Hazardous Material;
(iii) notify Landlord and Permitted Beneficiary of
any Hazardous Material that exists on or is discharged from or
onto the Premises (whether originating thereon or migrating to
the Premises from other property) or of any suit, claim.
demand, complaint. order. citation. or notice with regard to
such Hazardous Material or to air emissions. water discharges,
noise emissions or any other environmental, health or safety
matter affecting the Premises or Tenant from any person or
entity, including, without limitation, the United States
Environmental Protection Agency or the Texas Natural Resources
& Conservation Commission. after Tenant first has knowledge of
the same; and
(iv) comply, and cause the Premises to comply, with
all statutes, laws, ordinances, rules and regulations of all
local, state or federal authorities having authority over the
Premises or any portion thereof or their use, including
without limitation, relative to any Hazardous Material,
petroleum products. asbestos-containing materials or PCBS.
(v) "Hazardous Material" means any hazardous or toxic
material, substance or waste which is defined by those or
similar terms or is regulated as such under any Environmental
Laws. "Environmental Laws" means any statue, law, ordinance,
rule or regulation now in effect and as they may be amended or
enacted hereafter of any local, county, state or federal
authority having jurisdiction over the Premises or any portion
thereof or its use. including but not limited to: (A) the
Federal Water Pollution Control Act (33 U.S.C. ss.1317) as
amended; (B) the Federal Resource Conservation and Recovery
Act (42 U.S.C. ss.6901 et seq.) as amended; (C) the
Comprehensive Environmental Response Compensation and
Liability Act (42 U.S.C. ss.9601 et seq.). as amended; (D) the
Toxic Substance Control Act (12 U.S.C. ss.2601), as amended,
and (E) the Clean Air Act (42 U.S.C. ss.7401), as amended.
(vi) The Tenant's obligations and liabilities under
Section 6(b)(i)(C) and 6(b)(ii)(C) shall survive the
expiration or earlier termination of this Lease.
7. Indemnification. Tenant agrees to pay, and to protect, defend,
indemnify and save harmless Landlord, Permitted Beneficiary and their respective
officers, directors, employees and agents from and against any and all
liabilities, losses, damages, costs, expenses (including all attorney's fees and
expenses), causes of action, suits, claims, demands or judgments of any nature
whatsoever (i) arising from any injury to, or the death of, any person or damage
to property on the Premises or upon adjoining sidewalks, streets or ways, in any
manner growing out of or connected with Tenant's possession, use, non-use,
misuse, maintenance or occupation of the Premises or any part thereof or
resulting from the condition thereof during the Lease Term or of adjoining
sidewalks, streets or ways, so long as not occasioned solely by the affirmative,
grossly negligent act or intentional malfeasance of Landlord or Permitted
Beneficiary, and/ or (ii) arising from violation by Tenant of any agreement or
condition of this Lease, or any contract or agreement to which Tenant is a
party, or any restriction, law, ordinance or regulation, in each case affecting
the Premises or any part thereof or the ownership, occupancy or use thereof, so
long as not occasioned solely by the affirmative, grossly negligent act or
intentional fault of Landlord or Permitted Beneficiary. If Landlord, Permitted
Beneficiary or any officer, director, employee or agent of Landlord or Permitted
Beneficiary shall be made a party to any such litigation, and if Tenant, at its
expense, shall fail to provide Landlord, Permitted Beneficiary and their
officers, directors, employees and agents with counsel (upon Landlord's request)
reasonably acceptable to Landlord, Tenant shall pay all costs and attorneys'
fees and expenses incurred or paid by Landlord, Permitted Beneficiary and their
officers, directors, employees and agents in connection with such litigation.
Tenant's obligations and liabilities under this Section 7 herein shall survive
the expiration or earlier termination of this Lease.
8. Required Insurance.
(a) Tenant shall maintain or cause to be maintained, at its
sole expense, the following insurance on the Premises (herein called
the "Required Insurance"):
(i) Insurance against loss or damage by fire,
lightning and other risks from time to time included under
"all risk" policies, including, without limitation, plate
glass insurance, sprinkler leakage, collapse and vandalism and
malicious mischief coverage. in amounts sufficient to prevent
Landlord or Tenant from becoming a co-insurer of any loss
under the applicable policies but in any event in amounts not
less than the full insurable value of the improvements
including those fixtures and equipment appurtenant to and used
in connection with the operation of the Premises. In addition
to the foregoing, Tenant shall, at Tenant's sole cost and
expense, provide and keep in force for the benefit of Landlord
and Tenant throughout the Term of this Lease, flood insurance,
provided the Premises are located within the "Federal Flood
Plain Area" of the United States, as well as insurance against
loss or destruction of or damage or injury to any improvements
now or hereafter erected oil the Premises resulting from water
or earthquake damage. The "deductible" under each of said
policies shall be an amount not greater than Five Thousand
Dollars ($5.000). The term "full insurable value", as used
herein, means actual replacement value (i.e., including the
cost of debris removal but excluding foundation and
excavations) as reasonably determined by Landlord from time to
time.
(ii) Comprehensive general public liability insurance
for the benefit of Landlord, Tenant and Permitted Beneficiary,
including blanket contractual liability coverage specifically
endorsed to provide coverage for the obligations assumed by
Tenant pursuant to this Lease, against claims and liability
for personal injury, bodily injury, death or property damage
occurring on, in or about the Premises and the adjoining
streets, sidewalks, gutters, curbs, passageways and other
areas adjacent thereto, if any, with limits of liability of
not less than Two Million Dollars ($2,000,000) arising out of
any one occurrence or annual aggregate or such greater limits
as may be required from time to time by the Permitted
Beneficiary or as may reasonably be required by Landlord
consistent with coverage on properties similarly constructed,
occupied and maintained, such insurance to include full
coverage of the indemnity set forth in Section 7. Policies for
such insurance shall be for the mutual benefit of Landlord,
Tenant and any Permitted Beneficiary, as their respective
interests may appear.
(iii) Tenant shall also provide and maintain
insurance at Tenant's cost and expense throughout the Term of
this Lease, for loss or damage caused by or resulting from
explosion of steam boilers, pressure vessels, air conditioning
systems, or similar apparatus now or hereafter installed upon
the Premises, to the extent applicable. Said insurance shall
be on a Boiler and Machinery, Broad Form policy on a repair
and replacement basis.
(iv) Worker's compensation insurance covering all
persons employed in connection with any work or operations
done or performed on or about the Premises with respect to
which claims for death or bodily injury could be asserted
against Landlord, Tenant or the Premises, with statutory
limits of liability and employee's liability insurance with
limits of liability of not less than Two Million Dollars
($2,000,000).
(v) At any time when any portion of the Premises are
being constructed, altered or replaced, builder's risk (in
completed value nonreporting form) in an amount not less than
the actual replacement value of the Improvements, exclusive of
foundations and excavations.
(vi) Such other insurance on the Premises. in such
amounts and against such other hazards which at the time are
commonly obtained in the case of property similar to the
Premises, including, without limitation, war risk insurance
(at and during such times as war risk insurance is obtained in
the case of property similar to the Premises), when and to the
extent obtainable from the United States Government or any
agency thereof
(b) The Required Insurance shall be written by companies of
recognized financial standing authorized to do insurance business in
the State of Texas and shall be satisfactory to Landlord and Permitted
Beneficiary and have a rating of not less than A+ in Best's Insurance
Guide or any successor thereto. The Required Insurance shall name as
the insured parties thereunder Landlord and Tenant, as their interests
may appear, and the Permitted Beneficiary as an additional insured
under a standard "non-contributory mortgagee" endorsement or its
equivalent. Landlord shall not be required to prosecute any claim
against, or to contest any settlement proposed by, an insurer. Tenant
may, at its expense, prosecute any such claim or contest any such
settlement in the name of Landlord, Tenant or both, and Landlord will
join therein at Tenant's written request upon the receipt by Landlord
of an indemnity from Tenant against all costs, liabilities and expenses
in connection therewith.
(c) Every policy of Required Insurance shall contain an
agreement that the insurer will not cancel such policy except after
thirty (30) days written notice to Landlord and Permitted Beneficiary
and that any loss otherwise payable thereunder shall be payable
notwithstanding any act or negligence of Landlord, Tenant or Permitted
Beneficiary which might, absent such agreement, result in a forfeiture
of all or a part of such insurance payment and notwithstanding (i) any
foreclosure or other action taken by a Permitted Beneficiary pursuant
to any provision of any Permitted Deed of Trust upon the happening of a
default or Event of Default thereunder or (ii) any change in ownership
of the Premises.
(d) Tenant shall deliver to Landlord promptly after the
delivery of this Lease the original or duplicate policies or
certificates of insurers, satisfactory to any Permitted Beneficiary,
evidencing all of the Required Insurance. Tenant shall, within thirty
(30) days prior to the expiration of any such policy, deliver to
Landlord other original or duplicate policies or such certificates
evidencing the renewal of any such policy. If Tenant fails to maintain
or renew any Required Insurance, or to pay the premium therefor, or to
deliver any such policy or certificate, then Landlord, at its option,
but without obligation to do so, may procure such insurance. Any sums
so expended by Landlord shall be additional rent hereunder and shall be
repaid by Tenant within five (5) days after notice to Tenant of such
expenditure and the amount thereof.
(e) Neither Tenant nor Landlord shall obtain or carry separate
insurance covering the same risks as any Required Insurance unless
Tenant, Landlord and the Permitted Beneficiary are included therein as
named insured, with loss payable as provided in this Lease and the
policy contains a first mortgagee endorsement in favor of the Permitted
Beneficiary. Tenant and Landlord shall immediately notify each other
whenever any such separate insurance is obtained and shall deliver to
each other the policies or certificates evidencing the same.
(f) Anything contained in this Section 8 to the contrary
notwithstanding, all Required Insurance may be carried under a
"blanket" or "umbrella" policy or policies covering other properties or
liabilities of Tenant, provided, that such policies otherwise comply
with the provisions of this Lease and specify the coverages and amounts
thereof with respect to the Premises.
(g) Landlord or Permitted Beneficiary shall not be limited in
the proof of any damages which Landlord or Permitted Beneficiary may
claim against Tenant arising out of or by reason of Tenant's failure to
provide and keep in force insurance, as provided above, to the amount
of the Insurance premium or premiums not paid or incurred by Tenant and
which would have been payable under such insurance; but Landlord and
Permitted Beneficiary shall also be entitled to recover as damages for
such breach, the uninsured amount of any loss to the extent of any
deficiency in the Required Insurance and damages, costs and expenses of
suit suffered or incurred by reason of or damage to, or destruction of.
the Premises, occurring during any period when Tenant shall have failed
or neglected to provide the Required Insurance. Tenant shall indemnify
and hold harmless Landlord and Permitted Beneficiary for any liability
incurred by Landlord or Permitted Beneficiary arising out of any
deductibles for Required Insurance.
9. Fire or Other Casualty.
(a) In the event of damage to or destruction of all or part of
the improvements on the Premises (the "Improvements") during the Term
of this Lease by fire, the elements, or other casualty for which the
insurance carried pursuant to Section 8 of this Lease entitled
"Required Insurance" is payable, said insurance proceeds so paid shall
be deposited in a joint account of Landlord and Tenant in a bank
designated by Landlord and shall be used by Tenant for the prompt
reconstruction or repair, as the case may be, of the Improvements.
Tenant shall rebuild or repair the improvements in such manner that the
Improvements, as so rebuilt or repaired, shall be of the same value as
they were prior to such damage or destruction, and shall have same
rebuilt or repaired and ready for occupancy within six (6) months from
the time the loss or destruction occurred. Amounts shall be paid out by
Landlord and Tenant from said joint account from time to time upon the
certification of that person having supervision of such construction or
repair (said person having been chosen by Landlord and said
construction contract approved by Landlord) that said amount is being
applied to the payment of the reconstruction or repair at a reasonable
cost therefor and that the disbursement then requested, plus all
previous disbursements and the amount of any applicable deductible, do
not exceed the cost of the repair or restoration already completed and
paid for, and that the balance in said joint account is sufficient to
pay for the estimated cost of completing the repair or restoration. If
the insurance proceeds shall be less than the cost of repair or
restoration, Tenant shall pay the excess cost. If the insurance
proceeds exceed the cost of repair or restoration, Tenant shall receive
said excess upon final completion of such repair or restoration. To the
extent that the Improvements are rendered unusable by any casualty,
Monthly Rent shall be equitably abated provided that Tenant proceeds to
undertake repairs promptly and prosecutes repairs diligently and to the
reasonable satisfaction of Landlord.
Notwithstanding the foregoing subparagraph, Tenant shall not
be obligated to restore the Improvements if the reasonable cost of
doing so exceeds $100,000 or if, in the reasonable estimate of
Landlord, such restoration cannot be completed within six (6) months
following the date of the casualty. In such event(s), Tenant may elect
to terminate the Lease by written notice to Landlord within 21 days
following the casualty. If Tenant elects to terminate (i) Monthly Rent
and other amounts payable by Tenant under this Lease shall be
apportioned on a per diem basis and paid to the date of damage or
destruction, (ii) Tenant shall remit to Landlord any deductible payable
under the Required Insurance, and (iii) Tenant shall assign to Landlord
all of its right, title and interest in and to the proceeds payable
under the Required Insurance with respect to the Improvements.
In the event of any casualty that materially impairs Tenant's
use of the Premises and that is not caused in whole or in part by
Tenant, its agents, employees, invitees or contractors, and provided
that Tenant promptly commences to undertake repairs and prosecutes
repairs to the Premises diligently and to the reasonable satisfaction
of Landlord, Landlord shall equitably abate Monthly Rent during the
interval within which Tenant's use of the Premises is materially
impaired.
(b) If, at any time after such insurance proceeds come into
possession of Landlord and Tenant after destruction or damage by
casualty, Tenant is in default of any Monthly Rent, then Landlord shall
be entitled to so much of said proceeds as may be necessary to pay and
discharge any such Monthly Rent or other charges of which Tenant is in
default, whenever and as often as any such default shall occur. Tenant
shall forthwith reimburse such joint bank account by depositing therein
any amount so paid out on account of Tenant's default. Nothing herein
contained, however, shall be construed as permitting Tenant to default
in the payment of Monthly Rent or other charges herein stipulated to be
paid or in the performance of any other covenants of this Lease, and
Landlord may, at its option, proceed against Tenant for the collection
of such Monthly Rent or other charges in default and recover and take
possession of the Premises in accordance with the provisions of this
Lease without prejudice to Landlord's right to the benefit of such
insurance money as security for Tenant's performance under the terms of
this Lease.
(c) All provisions herein contained relative to the
disposition of payments from insurance companies are subject to the
requirement that, if any mortgagee who holds a mortgage on the Premises
elects, in accordance with the terms of such mortgage, to require such
insurance proceeds be paid to the mortgagee on account of the mortgage,
then such payment shall be made, but in such event, Tenant must create
the complete fund in the manner set forth in this Section 9 to assure
and complete the payment for the work of reconstruction or repair.
10. Repairs and Reentry. Tenant will. at Tenant's own cost and expense,
maintain and keep tile Premises and any alterations and additions thereto in
sound condition and good repair, and shall pay for the immediate repair of any
damage or injury done to the Premises or any part thereof by Tenant or Tenant's
agents, employees and invitees; provided, however, that Tenant shall make no
repairs to the Premises without the prior written consent of Landlord. The
performance by Tenant of its obligation to maintain and make repairs shall be
conducted only by contractors approved by Landlord after plans and
specifications therefor have been approved by Landlord. Tenant will not continue
or allow any waste or damage to be committed on any portion of the Premises, and
upon the termination of this Lease by lapse of time or otherwise, Tenant shall
deliver up the Premises to Landlord in as good condition as at date of
possession, ordinary wear and tear excepted. Upon such termination of this
Lease, Landlord shall have the immediate right to reenter and resume possession
of the Premises. Notwithstanding the foregoing provisions of this Section, any
repairs to the Premises that are necessitated because of any damage caused by
fire or other casualty shall be governed by the provisions of Section 9. Tenant
shall be responsible for maintenance to all of the Premises including the
exterior, structural, any common areas, landscaping, parking lot, driveways and
sidewalks of the Premises.
11. Assignment and Subletting. In the event that Tenant desires to
assign this Lease or sublet all or any part of the Premises or grant any
license, concession or other right of occupancy of any portion of the Premises.
Tenant shall notify Landlord in writing and shall state the name of the proposed
assignee, sublease or other transferee and the terms of the proposed assignment,
sublease or transfer. Tenant shall also provide detailed financial information
and state the nature and character of the business of the proposed assignee,
sublease or transferee.
Tenant shall not assign or mortgage this Lease or any right hereunder
or interest herein, and Tenant shall not sublet the Premises in whole or in part
or grant any license, concession or other right of occupancy of any portion of
the Premises, without the prior written consent of Landlord. Landlord may
withhold its consent to any assignment of all or any portion of the Premises in
the absolute discretion of Landlord. Landlord's consent to a sublease of all or
any portion of the Premises shall not be unreasonably withheld or delayed,
provided that the terms of the sublease are reasonably acceptable to Landlord
and further provided that the sublease forwarded to Landlord for its review is
accompanied by Tenant's check for $750.00, being Landlord's reasonable estimate
of the cost to Landlord of legal review by Landlord's counsel.
Any assignment, mortgage or subletting without such consent shall be
void and shall, at the sole option of the Landlord, be deemed an event of
default by Tenant under this Lease. Notwithstanding any assignment or subletting
consented to by Landlord, Tenant and any guarantor of Tenant's obligations under
this Lease and each assignee shall at all times remain fully responsible and
liable for the payment of the rent herein specified and for compliance with all
of Tenant's other covenants and obligations under this Lease. No consent to any
assignment or mortgage of this Lease or any subletting of the Premises shall
constitute a waiver of the provisions of this Section except as to the specific
instance covered thereby.
In the event that the monthly rental per square foot of space subleased
which is payable by any sublessee to Tenant shall exceed the monthly rental per
square foot for the same space payable for the same month by Tenant to Landlord
(including any bonuses or any other consideration paid directly or indirectly by
the sublessee to Tenant), Tenant shall be obligated to pay one-half of the
amount of such excess to Landlord as additional rent hereunder on the same date
it is received by Tenant from the sublessee. In the event Tenant shall receive
any consideration from an assignee other than the assumption by the assignee of
Tenant's obligations hereunder, Tenant shall be obligated to pay the one half of
such consideration to Landlord as additional rent hereunder on the same date it
is received by Tenant.
Landlord, at Landlord's option, may elect to require that rental
payable by any sublessee be paid directly to Landlord and offset Tenant's rent
obligations accordingly. At no time during the Lease Term shall Tenant be
entitled to (i) advertise the Premises for sublease without the prior written
consent of Landlord and (ii) market the Premises for sublease at a rate less
than the fair market value of the Premises. If Tenant is a corporation or
partnership, an assignment prohibited by this Section shall be deemed to include
one or more sales or transfers by operation of law or otherwise, or creation of
new stock or partnership shall be vested in a party or parties who are not
owners of a majority of the voting shares or partnership interests of Tenant as
of the date hereof, provided, however, that the foregoing provisions of this
sentence shall not be applicable if (i) Tenant's stock is listed on a recognized
securities exchange or (ii) at least eighty percent (80%) of Tenant's stock is
owned by a corporation whose stock is listed on a recognized securities
exchange. For the purpose hereof, stock ownership shall be determined in
accordance with the principles set forth in section 544 of the Internal Revenue
Code of 1986, as amended to the date hereof. Any transfer by operation of law
shall also constitute an assignment prohibited by this Section.
12. Alterations and Additions by Tenant. Tenant shall make no
alterations in or additions to the Premises without the prior written consent of
the Landlord; and all alterations, additions, and improvements made to or
fixtures or improvements placed in or upon the Premises by either party (except
only moveable trade fixtures installed by Tenant and removable without material
damage to the Premises) shall be deemed a part of the Premises and the property
of the Landlord at the time they are placed in or upon the Premises, and they
shall remain upon and be surrendered with the Premises as a part thereof at the
termination of this Lease, unless Landlord shall elect otherwise, whether such
termination shall occur by the lapse of time or otherwise. In the event Landlord
shall elect that certain alterations, fixtures, additions and improvements made
or added by Tenant in the Premises shall be removed by Tenant, Tenant shall
remove them and Tenant shall restore the Premises to their original condition,
at Tenant's own cost and expense, prior to the termination of the Lease Term.
Approved alterations and additions to the Premises may at Landlord's option be
performed by Landlord at Tenant's cost and expense.
13. Legal Use; Violations of Insurance Coverage; Nuisance. Tenant will
not occupy or use any portion of the Premises for any purpose other than the
Sole Permitted Use or for any purpose which is unlawful or which, in the
reasonable judgment of Landlord, is disreputable or which is hazardous due to
risk of fire, explosion or other casualty, nor permit anything to be done which
will in any way (i) increase the rate of fire and casualty insurance on the
Premises or their contents, or (ii) tend to lower the existing character and
reputation of the Premises, or (iii) create unreasonable elevator loads or
otherwise interfere with standard Premises operations, or (iv) affect the
structural integrity or design capabilities of the Premises. In the event that,
by reason of any act or conduct of business of Tenant, there shall be any
increase in the rate of insurance on the Premises or their contents created by
Tenant's acts or conduct of business, then Tenant hereby agrees to pay Landlord
the amount of such increase on demand. Tenant shall not erect, place, or allow
to be placed any sign, advertising matter, stand, booth or showcase in, upon or
visible from the vestibules, halls, corridors, doors, outside walls, outside
windows or pavement of the Premises without the prior written consent of
Landlord. Tenant will conduct its business, and control its agents, employees,
and invitees in such a manner as not to create any nuisance or interfere with,
annoy or disturb Landlord in the management of the Premises.
14. Laws and Regulations. Tenant at its sole expense will maintain the
Premises in a clean and healthful condition and will comply with all zoning
provisions and restrictive covenants, and all laws, ordinances, orders, rules
and regulations of any governmental authority having jurisdiction over the use,
conditions or occupancy of the Premises.
15. Rules of the Premises. Tenant will comply fully, and will cause
Tenant's agents, employees, and invitees; to comply fully with all Rules and
Regulations of the Premises which are attached hereto as Exhibit "B" and made a
part hereof as though fully set out herein. As more particularly provided
therein, Landlord shall at all times have the right to change such Rules and
Regulations or to amend them in such reasonable manner as Landlord may deem
advisable for the safety, protection, care and cleanliness of the Premises and
appurtenances and for preservation of good order therein, all of which Rules and
Regulations, changes and amendments will be forwarded to Tenant in writing and
shall be complied with and observed by Tenant and Tenant's agents, employees and
invitees.
16. Entry for Repairs and Inspection. Landlord and its agents and
representatives shall have the right to enter into and upon any and all parts of
the Premises at all reasonable hours (or, in an emergency, at any hour) to
inspect same or clean or make repairs or alterations or additions to the
Premises and the Premises (whether structural or otherwise) as Landlord may deem
necessary, and during the continuance of any such work, Landlord may temporarily
close doors, entryways, public spaces and corridors and interrupt or temporarily
suspend Premises services and facilities, and Tenant shall not be entitled to
any abatement or reduction of rent by reason thereof. During the Lease Term,
Landlord may exhibit the Premises to prospective purchasers and lenders at
reasonable hours and upon prior notice to Tenant. Furthermore, during the
nine-month period prior to the expiration date of this Lease, Landlord and
Landlord's agents may exhibit the Premises to prospective tenants during normal
business hours and upon prior notice to Tenant.
17. Condemnation. If either of the Premises, or so much thereof as
would materially interfere with Tenant's use of the remainder, shall be taken or
condemned for any public use or purpose by fight of eminent domain, with or
without litigation, or be transferred by agreement in connection with or in lieu
of or under threat of condemnation, then the Lease Term and the leasehold estate
created hereby shall at Landlord's option terminate as of the date title shall
vest in the condemnor or transferee. As used in the previous sentence,
"materially interfere" shall mean a taking or condemnation of (i) Tenant's
ingress or egress to the Premises such that no functionally equivalent
substitute remains, (ii) more than 25% of the Rentable Space or the parking or
loading area of the Premises, (iii) more than 10% of the Rentable Space devoted
to office use.
If less than a portion that will "materially interfere" with Tenant's
use of the remainder is taken or so transferred, this Lease shall remain in full
force and effect, but Monthly Rent for the remainder of the Premises shall be
equitably reduced, and Landlord shall, promptly following receipt of
condemnation award(s), remit to Tenant so much of same as is requisite for
Tenant to make such repairs and restorations as is necessary to return the
Premises to as near to its former condition as circumstances will permit.
If all or any portion of either of the Premises is taken or condemned
or transferred as aforesaid, Landlord shall receive the entire award from any
taking or condemnation (or the entire compensation paid because of any transfer
by agreement), and Tenant shall have no claim thereto other than for
compensation paid for disruption to Tenant's business; provided, however, that
Tenant shall have the right separately to pursue against the condemning
authority an award in respect of any loss to leasehold improvements approved by
Landlord and paid for by Tenant and any moving expenses incurred without any
credit or allowance from Landlord.
18. Landlord's Lien. Landlord shall have a landlord's statutory lien to
the extent provided by Texas law on the property of Tenant located in, upon or
about the Premises.
19. Abandoned Property. All personal property of Tenant remaining in
the Premises five (5) business days after the termination or expiration of the
Lease Term or one (1) business day after the abandonment of the Premises by
Tenant may be treated by Landlord as having been abandoned by Tenant. and
Landlord may, at its option and election, thereafter take possession of such
property and either (i) declare same to be the property of Landlord, or (ii) at
the cost and expense of Tenant, store and/or dispose of such property in any
manner and for whatever consideration, Landlord, in its sole discretion, shall
deem advisable. Tenant shall be presumed conclusively to have abandoned the
Premises if the amount of Tenant's property removed by Tenant from the Premises
is substantial enough to indicate a probable intent to abandon the Premises and
such removal is not in the normal course of Tenant's business, or if Tenant
removes any material amount of Tenant's personal property from the Premises, at
a time when Tenant is in default in the payment of rental due hereunder or in
the performance of any other obligation of Tenant hereunder and such removal is
not in the normal course of Tenant's business. Nothing contained in this Section
shall prejudice or impair Landlord's rights as a lienholder and secured party
under Section 18 hereof, and the rights granted to Landlord under this Section
shall be cumulative of its rights as a lienholder and secured party.
20. Holding Over. Should Tenant continue to hold the Premises after
this Lease terminates, whether by lapse of time or otherwise, such holding over
shall, unless otherwise agreed by Landlord in writing, constitute and be
construed as a tenancy at will at a daily rental equal to one-thirtieth (1/30)
of an amount equal to double the amount of the monthly rental payable during the
last month prior to the termination of this Lease and upon and subject to all of
the other terms and provisions set forth herein except any right to renew this
Lease, expand the Premises or lease additional space. This provision shall not
be construed, however, as permission by Landlord for Tenant to holdover. No
payments of money by Tenant to Landlord after the termination of this Lease
shall reinstate, continue, or extend the Lease Term, and no extension of this
Lease after the termination hereof shall be valid unless and until the same
shall be reduced to writing and signed by both Landlord and Tenant. Tenant shall
be liable to Landlord for all damage which Landlord shall suffer by reason of
any holding over by Tenant, and Tenant shall indemnify Landlord against all
claims made by any other tenant or prospective tenant against Landlord resulting
from delay by Landlord in delivering possession of the Premises (or any portion
thereof) to such other tenant or prospective tenant.
21. Entire Agreement and Amendment; No Representations or Warranties;
No Memorandum of Lease. This Lease contains the entire agreement between the
parties hereto with respect to the subject matter hereof and supersedes any and
all prior and contemporaneous, oral or written agreements, understandings,
promises, and representations made by either party to the other concerning the
subject matter hereof and the terms applicable hereto. It is expressly agreed by
Tenant, as a material consideration to Landlord for the execution of this Lease,
that there have been no representations, understandings, stipulations,
agreements or promises pertaining to the Premises, the Premises or this Lease
not incorporated in writing herein. This Lease shall not be altered, waived,
amended or extended, except by a written agreement signed by the parties hereto,
unless otherwise expressly provided herein. LANDLORD'S DUTIES AND WARRANTIES ARE
LIMITED TO THOSE SET FORTH IN THIS LEASE, AND SHALL NOT INCLUDE ANY IMPLIED
DUTIES OR WARRANTIES, ALL OF WHICH ARE HEREBY DISCLAIMED BY LANDLORD AND WAIVED
BY TENANT. Neither this Lease nor a memorandum of this Lease shall be recorded
in the public records of the county in which the Premises is located without the
prior written consent of Landlord.
22. Transfer of Landlord's Rights. In the event Landlord transfers its
interest in the Premises, Landlord shall thereby automatically be released from
any further obligations hereunder, and Tenant agrees to look solely to the
successor in interest of Landlord for the performance of such obligations.
23. Default.
(a) The following events shall be deemed to be events of
default (herein so called) by Tenant under this Lease:
(i) Tenant shall fail to pay any rental or other sum
payable by Tenant hereunder as and when such rental or other
sum becomes due and payable, provided. however, that Tenant
shall be entitled to receive, one (1) time each calendar year,
a written notice of such failure from Landlord and a five (5)
day period thereafter to cure such payment default;
(ii) Tenant shall fail to comply with any other
provision. condition or covenant of this Lease and any such
failure is not cured within fifteen (15) days after Landlord
gives written notice of such failure to Tenant, provided that
such failure shall not be deemed an event of default if Tenant
commences to cure such failure within such 15-day period and
thereafter continues to pursue such cure diligently and in
good faith;
(iii) Tenant shall desert. vacate or fail to
physically occupy any substantial portion of the Premises;
(iv) Tenant shall assign this Lease or sublet all or
any, part of the Premises or grant any license, concession or
other fight of occupancy of any portion of the Premises.
without the prior written consent of Landlord;
(v) Any petition shall be filed by or against Tenant
or any guarantor of Tenant's obligations under this Lease
pursuant to any section or chapter of the resent federal
Bankruptcy Act or under any future federal Bankruptcy Act or
under similar law or statute of the United States or any state
thereof (which as to any involuntary petition shall not be and
remain discharged or stayed within a period of sixty (60) days
after its entry), or Tenant or any guarantor of Tenant's
obligations under this Lease shall be adjudged bankrupt or
insolvent in proceedings filed under any section or chapter of
the present federal Bankruptcy Act or under any future federal
Bankruptcy Act or tinder any similar law or statute of the
United States or any state thereof;
(vi) Tenant or any guarantor of Tenant's obligations
under this Lease shall become insolvent or make a transfer in
fraud of creditors;
(vii) Tenant or any guarantor of this Lease shall
make an assignment for the benefit of creditors; or
(viii) A receiver or trustee shall be appointed for
Tenant or any guarantor of this Lease or for any of the assets
of Tenant or any guarantor of this Lease.
(b) Upon the occurrence of any event of default, Landlord
shall have the option to do any one or more of the following without
any further notice or demand, in addition to and not in limitation of
any other remedy permitted by law, equity or by this Lease:
(i) Enforce, by all legal suits and other means, its
rights hereunder, including the collection of Monthly Rent and
other sums payable by Tenant hereunder and the reimbursement
for all unamortized tenant allowances and concessions, without
reentering or resuming possession of the Premises and without
terminating this Lease.
(ii) Terminate this Lease by issuing written notice
of termination to Tenant, in which event Tenant shall
immediately surrender the Premises to Landlord, but if Tenant
shall fail to do so, Landlord may without notice and without
prejudice to any other remedy Landlord may have, enter upon
and take possession of the Premises and expel or remove Tenant
and its effects without being liable to prosecution or any
claim for damages therefor, and upon any such termination,
Tenant agrees that in addition to its liability for the
payment of arrearages of Monthly Rent and other sums due and
owing by Tenant to Landlord under this Lease upon such
termination, Tenant shall be liable to Landlord for damages.
Tenant shall pay to Landlord as damages on the same days as
Monthly Rent and other payments which are expressed to be due
under the provisions of this Lease, the total amount of such
Monthly Rent and other payments plus a reimbursement for all
unamortized tenant allowances and concessions, less such part,
if any. of such payments that Landlord shall have been able to
collect from a new tenant upon reletting; provided, however,
that Landlord shall have no obligation to relet the Premises
so as to mitigate the amount for which Tenant is liable.
Landlord shall have the right at any time to demand final
settlement. Upon demand for a final settlement, Landlord shall
have the right to receive, and Tenant hereby agrees to pay, as
damages for Tenant's breach, the difference between the total
rental provided for in this Lease for the remainder of the
Lease Term and the reasonable rental value of the Premises for
such period, such difference to be discounted to present value
at a rate equal to the rate of interest allowed by law (at the
time the demand for final settlement is made) when the parties
to a contract have not agreed on any particular rate of
interest (or, in the absence of such law, at the rate of 8%
per annum).
(iii) Enter upon and take possession of the Premises
without terminating this Lease and expel or remove Tenant and
its effects therefrom without being liable to prosecution or
any claim for damages therefor, and Landlord may relet the
Premises for the account of Tenant. Tenant shall pay to
Landlord all arrearages of Monthly Rent and other sums due and
owing by Tenant to Landlord, and Tenant shall also pay to
Landlord during each month of the unexpired Lease Term the
installments of Monthly Rent and other sums due hereunder,
less such part, if any, that Landlord shall have been able to
collect from a new tenant upon reletting; provided, however,
that Landlord shall have no obligation to relet the Premises
so as to mitigate the amount for which Tenant is liable. In
the event Landlord exercises the rights and remedies afforded
to it under this Section 23(b)(iii) and then subsequently
elects to terminate this Lease, Tenant shall be liable to
Landlord for damages as set forth in Section 23(b)(ii) above
and Landlord shall have the right at any time to demand final
settlement as provided therein.
(iv) Landlord may do whatever Tenant is obligated to
do by the provisions of this Lease and may enter the Premises
in order to accomplish this purpose. Tenant agrees to
reimburse Landlord immediately upon demand for any expenses
which Landlord may incur in his actions pursuant to this
subparagraph, and Tenant further agrees that Landlord shall
note be liable for damages resulting to Tenant from such
action, whether caused by the negligence of Landlord or
otherwise.
(v) Landlord may enter upon the Premises and change,
alter, or modify the door locks on all entry doors of the
Premises, and permanently to temporarily exclude Tenant, and
its agents, employees, representatives and invitees, from the
Premises. In the event that Landlord either permanently
excludes Tenant from the Premises or terminates this Lease on
account of Tenant's default, Landlord shall not be obligated
thereafter to provide Tenant with a key to reenter the
Premises at any time, regardless of any amounts subsequently
paid by Tenant. If Landlord elects to exclude Tenant from the
Premises temporarily without permanently repossessing the
Premises or termination the Lease, then Landlord shall not be
obligated to provide Tenant with a key to reenter the Premises
until such time as all delinquent rent and other amounts due
under this Lease have been paid in full and all other
defaults, if any, have been cured and Tenant shall have given
Landlord evidence reasonably satisfactory to Landlord that
Tenant has the ability to comply with its remaining
obligations under this Lease; and if Landlord temporarily
excludes Tenant from the Premises. Landlord shall have the
right thereafter to permanently exclude Tenant from the
Premises or terminate this Lease at any time before Tenant
pays all delinquent rent, cures all other defaults and
furnishes such evidence to Landlord. Landlord's exclusion of
Tenant from the Premises shall not constitute a permanent
exclusion of Tenant from the Premises or a termination of this
Lease unless Landlord so notifies Tenant in writing. Landlord
shall not be obligated to place a written notice on the
Premises on the front door thereof explaining Landlord's
action or stating the name, address or telephone number of any
individual or company from which a new key may be obtained. In
the event Landlord permanently or temporarily excludes Tenant
from the Premises or terminates this Lease, and Tenant owns
property that has been left in the Premises but which is not
subject to any statutory or contractual lien or security
interest held by Landlord as security for Tenant's
obligations, Tenant shall have the right to promptly so notify
Landlord in writing, specifying the items of property not
covered by any such lien or security interest and which Tenant
desires to retrieve from the Premises. Landlord shall have the
right to either (i) escort Tenant to the Premises to allow
Tenant to retrieve Tenant's property not covered by any such
lien or security interest, or (ii) remove such property
himself and make it available to Tenant at a time and place
designated by Landlord. In the event Landlord elects to remove
such property himself as provided in the immediately preceding
clause (ii), Landlord shall not be obligated to remove such
property or deliver it to Tenant unless Tenant shall pay to
Landlord, in advance, an amount of cash equal to the amount
that Landlord estimates Landlord will be required to expend in
order to remove such property and make it available to Tenant,
including all moving or storage charges theretofore or
thereafter incurred by Landlord with respect to such property.
If Tenant pays such estimated amount to Landlord and the
actual amount incurred by Landlord differs from the estimated
amount, Tenant shall pay any additional amounts to Landlord on
demand or Landlord shall refund any excess amounts paid by
Tenant to Tenant on demand.
Pursuit of any of the foregoing remedies shall not preclude
pursuit of any of the other remedies herein provided or any other
remedies provided by law or equity. Any entry by Landlord upon the
Premises may be by use of a master or duplicate key or electronic pass
card or any locksmith's entry procedure or other means. Any reletting
by Landlord shall be without notice to Tenant, and if Landlord has not
terminated this Lease, the reletting may be in the name of Tenant or
Landlord, as Landlord shall elect. Any reletting shall be for such term
or terms (which may be greater or less than the period which. in the
absence of a termination of this Lease, would otherwise constitute the
balance of the Lease Term) and on such terms and conditions (which may
include free rent, rental concessions or tenant inducements of any
nature) as Landlord in its absolute discretion may determine, and
Landlord may collect and receive any rents payable by reason of such
reletting. In the event of any reletting, Tenant shall pay to Landlord
on demand the cost of renovating, repairing and altering the Premises
for a new tenant or tenants, and the cost of advertisements, brokerage
fees, reasonable attorney's fees and other costs and expenses incurred
by Landlord in connection with such reletting. In the event any rentals
actually collected by Landlord upon any such reletting for any calendar
month are in excess of the amount of rental payable by Tenant under
this Lease for the same calendar month, the amount of such excess shall
belong solely to Landlord and Tenant shall have no right with respect
thereto. In the event it is necessary for Landlord to institute suit
against Tenant in order to collect the rental due hereunder or any
deficiency between the rental provided for by this Lease for a calendar
month and the rental actually collected by Landlord for such calendar
month, Landlord shall have the right to allow such deficiency to
accumulate and to bring in action upon several or all of such rental
deficiencies at one time. No suit shall prejudice in any way the right
of Landlord to bring a similar action for any subsequent rental
deficiency or deficiencies.
24. Remedies; Attorney's Fees. No act or thing done by Landlord or its
agents during the Lease Term shall be deemed an acceptance of an attempted
surrender of the Premises, and no agreement to accept a surrender of the
Premises shall be valid unless made in writing and signed by Landlord. No
reentry or taking possession of the Premises by Landlord shall be construed as
an election on its part to terminate this Lease, unless a written notice of such
intention, signed by Landlord, is given by Landlord to Tenant. Notwithstanding
any such reletting or reentry or taking possession, Landlord may at any time
thereafter elect to terminate this Lease for a previous event of default.
Landlord's acceptance of rent following an event of default hereunder shall not
be construed as Landlord's waiver of such event of default. No waiver by
Landlord of any violation or breach of any of the terms, provisions and
covenants herein contained shall be deemed or construed to constitute a waiver
of any other violation or breach of any of the terms, provisions and covenants
herein contained. Forbearance by Landlord to enforce one or more of the remedies
herein provided upon an event of default shall not be deemed or construed to
constitute a waiver of any other violation or default. The failure of Landlord
to enforce any of the Rules and Regulations described in Section 15 against
Tenant or any other tenant in the Premises shall not be deemed a waiver of any
such Rules and Regulations. No provision of this Lease shall be deemed to have
been waived by Landlord unless such waiver is in writing and is signed by
Landlord. The rights granted to Landlord in this Lease shall be cumulative of
every other right or remedy which Landlord may otherwise have at law or in
equity, and the exercise of one or more rights or remedies shall not prejudice
or impair the concurrent or subsequent exercise of other rights or remedies.
If either party brings any action under this Lease, the prevailing
party shall pay the reasonable attorneys' fees and all other costs and expenses
incurred by the nonprevailing party in connection therewith. As used in the
previous sentence, "reasonable attorneys' fees" shall mean fees charged by
attorneys of comparable expertise and experience in the downtown Dallas or
Preston Center, Dallas areas.
25. Quiet Possession. Landlord hereby covenants that Tenant, upon
paving rent as herein reserved, and performing all covenants and agreements
herein contained on the part of Tenant, shall and may peacefully and quietly
have, hold and enjoy the Premises without any disturbance from Landlord or from
any other person claiming by, through or under Landlord, subject to the terms,
provisions, covenants, agreements and conditions of this Lease.
26. Severability. If any clause or provision of this Lease is illegal,
invalid or unenforceable under present or future laws effective during the Lease
Term, then and in that event, it is the intention of the parties hereto that the
remainder of this Lease shall not be affected thereby, and it is also the
intention of the parties to this Lease that in lieu of each clause or provision
that is illegal, invalid or unenforceable, there be added as a part of this
Lease a clause or provision as similar in terms to such illegal, invalid or
unenforceable clause or provision as may be possible and be legal, valid and
enforceable.
27. Security Deposit. The Security Deposit shall be held by Landlord
without liability for interest and as security for the performance by Tenant of
Tenant's covenants and obligations under this Lease, it being expressly
understood that the Security Deposit shall not be considered an advance payment
of rental or a measure of Landlord's damages in case of default by Tenant upon
the occurrence of any event of default by Tenant or upon termination of this
Lease. Landlord may commingle the Security Deposit with other funds. Landlord
may, from time to time, without prejudice to any other remedy, use the Security
Deposit to the extent necessary to make good any arrearages of rent or to
satisfy any other covenant or obligation of Tenant hereunder. Following any such
application of the Security Deposit, Tenant shall pay to Landlord on demand the
amount so applied in order to restore the Security Deposit to it s original
amount. If Tenant is not in default at the termination of this Lease, the
balance of the Security Deposit remaining after any such application shall be
returned by Landlord to Tenant. If Landlord transfers its interest in the
Premises during the Lease Term, Landlord may assign the Security Deposit to the
transferee and thereafter shall have no further liability for the return of, or
any other matter relating to, such Security Deposit.
28. No Subrogation. Tenant hereby waives any cause of action it might
have against Landlord on account of any loss or damage that is insured against
under any insurance policy that covers the Premises, Tenant's fixtures, personal
property, leasehold improvements or business and which names Tenant as a party
insured. Landlord hereby waives any cause of action it might have against Tenant
because of any loss or damage that is insured against under any insurance policy
that covers the Premises or any property of Landlord used in connection with the
Premises and which names Landlord as a party insured, provided that if the cost
of restoring the loss or damage exceeds the amount of property damage insurance
proceeds paid to Landlord on account of the loss or damage, Tenant shall remain
liable to Landlord for the amount of such excess. This provision is cumulative
of Section 19.
29. Binding Effect. The provisions of this Lease shall be binding upon
and inure to the benefit of Landlord and Tenant, respectively, and to their
respective heirs, personal representatives, successors and assigns, subject to
the provisions of Sections 11, 22 and 39 hereof.
30. Notices. Any notice required or permitted to be given hereunder by
one party to the other shall be deemed to be given when deposited in the United
States mail, certified or registered, return receipt requested, with sufficient
postage prepaid, or when hand delivered, addressed to the respective party to
whom notice is intended to be given at the address of such party set forth below
its name where it has executed this Lease. Either party hereto may at any time
by giving written notice to the other party in the aforesaid manner designate
any other address, which, in regard to notices to be given to Tenant, must be
within the continental United States, in substitution of the foregoing address
to which any such notice shall be given.
31. Brokerage. Tenant warrants that it has not had any dealings with
any broker or agent in connection with the negotiation or execution of this
Lease, and Tenant agrees to indemnify Landlord and hold Landlord harmless from
and against any and all cost, expense or liability for commissions or other
compensation or charges claimed by any other broker or agent with respect to
this Lease.
32. Subordination; Nondisturbance. This Lease and all rights of Tenant
hereunder are subject and subordinate to any deed of trust. mortgage or other
instrument of security which does now or may hereafter cover the Premises and
the Land or any interest of Landlord therein, and to any and all advances made
on the security thereof, and to any and all increases, renewals, modifications,
consolidations, replacements and extensions of any of such deed of trust,
mortgage or instrument of security. This provision is hereby declared by
Landlord and Tenant to be self-operative and no further instrument shall be
required to effect such subordination of this Lease. Tenant shall, however, upon
demand at any time or times execute, acknowledge and deliver to Landlord any and
all instruments and certificates that, in the judgement of Landlord, may be
necessary or proper to confirm or evidence such subordination. However,
notwithstanding the generality of the foregoing provisions of this Section,
Tenant agrees that any such mortgagee shall have the right at any time to
subordinate any such deed of trust, mortgage or other instrument of security to
this Lease on such terms and subject to such conditions as such mortgage may
deem appropriate in its discretion. Tenant further covenants and agrees upon
demand by Landlord's mortgagee at any time, before or after the institution of
any proceedings for the foreclosure of any such deed of trust, mortgage or other
instrument of security, or sale of the Premises pursuant to any such deed of
trust, mortgage or other instrument of security or voluntary sale, to attorn to
the purchaser upon any such sale and to recognize and attorn to such purchaser
as Landlord under this Lease. The agreement of Tenant to attorn upon demand of
Landlord's mortgagee contained in the immediately preceding sentence shall
survive any such foreclosure sale or trustee's sale. Tenant hereby agrees to
execute, acknowledge and deliver to Landlord's mortgagee any and all instruments
and certificates that Landlord's mortgagee may request in order to confirm or
evidence such attornment.
In the event that Landlord hereafter grants or enters into any deed of
trust, mortgage or instrument of security secured by the Premises or any portion
thereof, Landlord shall make its good faith best efforts to cause such
lienholder to recognize Tenant's interest hereunder and agree to refrain from
disturbing Tenant's possession of the Premises so long as Tenant is not in
default under this Lease.
33. Estoppel Certificates; Financial Statements.
(a) Tenant agrees to furnish from time to time, within ten
(10) business days following the request by Landlord or any successor
to Landlord or by the holder of any deed of trust or mortgage covering
the Land and Premises or any interest of Landlord therein, an estoppel
certificate signed by Tenant to the effect that this Lease is then
presently in full force and effect and specifying any modifications;
that the Lease Term has commenced and the full rental is then accruing
hereunder; that Tenant has accepted possession of the Premises and that
any improvements required by the terms of this Lease to be made by
Landlord have been completed to the satisfaction of Tenant; that no
rent under this Lease has been paid more than thirty (30) days in
advance of its due date; that the address for notices to be sent to
Tenant is as set forth in this Lease; that Tenant, as of the date of
such certificate, has no charge, lien or claim of offset under this
Lease or otherwise against rents or other charges due or to become due
hereunder; and that to the knowledge of Tenant, Landlord is not then in
default under this Lease. To the extent that Tenant believes any of the
foregoing to be inaccurate, Tenant shall specifically enumerate in the
certificate the alleged inaccuracy and Tenant's basis for refusing to
certify to such facts. At Landlord's option, any such certificate may
also contain an acknowledgment by Tenant of receipt of notice of the
assignment of this Lease to such holder and the agreement by Tenant
with such holder that from and after the date of such certificate,
Tenant will not pay any rent under this Lease more than thirty (30)
days in advance of its due date, will not surrender or consent to the
modification of any of the terms of this Lease nor to the termination
of this Lease by Landlord, and will not seek to terminate this Lease by
reason of any act or omission of Landlord until Tenant shall have given
written notice of such act or omission to the holder of such deed of
trust or mortgage (at such holder's last address furnished to Tenant)
and until a reasonable period of time shall have elapsed following the
giving of such notice, during which period such holder shall have the
right, but shall not be obligated, to remedy such act or omission;
provided, however, that (i) the agreement of Tenant described in this
sentence will be of no effect under such certificate unless Tenant is
furnished by such holder with a copy of any assignment to such holder
of Landlord's interest in this Lease within ninety (90) days after the
date of such certificate, and (ii) the agreement of Tenant with such
holder that is embodied in such certificate shall terminate upon the
subsequent termination of any such assignment.
(b) Tenant shall also furnish to Landlord when requested by
Landlord, but no more often than one time per calendar year, a complete
statement of the most recently released financial condition of Tenant
or its ultimate corporate parent, if consolidated statements are
prepared by same (balance sheet, income statement and funds sheet)
prepared by an independent certified public accountant according to
generally accepted accounting principles or in a form reasonably
satisfactory to Landlord.
34. [Intentionally deleted]
35. Premises Name and Address. Landlord reserves the right at any time
to change the name by which the Premises are designated, if any, and their
addresses, and Landlord shall have no obligation or liability whatsoever for
costs or expenses incurred by Tenant as a result of such name change or address
change of the Premises.
36. Mechanic's Liens. Nothing contained in this Lease shall authorize
Tenant to do any act which shall in any way encumber the title of Landlord in
and to the Premises or any part thereof; and if any mechanic's or materialman's
lien is filed or claimed against the Premises or any part thereof in connection
with any work performed, materials furnished or obligation incurred by or at the
request of Tenant, Tenant will promptly pay same or cause it to be released of
record. If the lien is not released of record within, or default in payment
thereof shall continue for twenty (20) days after written notice thereof from
Landlord to Tenant, without limiting or otherwise affecting any of Landlord's
other rights or remedies and without waiving any event of default by Tenant,
Landlord shall have the right and privilege so paid, including expenses and
interest, shall be so much additional rent hereunder from Tenant to Landlord and
shall be repaid to Landlord immediately on demand therefor.
37. Intentionally Deleted.
38. Constructive Eviction. Tenant shall not be entitled to claim a
constructive eviction from the Premises unless Tenant shall have first notified
Landlord in writing of the condition or conditions giving rise thereto,
including but not limited to the affirmative, grossly negligent acts or
intentional malfeasance of Landlord, and, if the complaints be justified, unless
Landlord shall have failed to remedy such conditions within a reasonable time
after receipt of said notice.
39. Personal Liability. The liability of Landlord to Tenant for any
default by Landlord under the terms of this Lease shall be limited to the
interest of Landlord in the Premises and the Land, and Landlord shall not be
personally liable for any deficiency. This clause shall not be deemed to limit
or deny any remedies which Tenant may have in the event of default by Landlord
hereunder which do not involve the personal liability of Landlord.
Notwithstanding anything to the contrary contained in this Lease, in the event
Landlord sells, assigns, transfers or conveys its interest in the Land, Landlord
shall have no liability for any acts or omissions that occur after the date of
said sale, assignment, transfer or conveyance.
40. [Intentionally Deleted]
41. No Waiver. No waiver by either party of any of its rights or
remedies hereunder, or otherwise, shall be considered a waiver of any other or
subsequent right or remedy of such party; no delay or omission in the exercise
or enforcement of any rights or remedies shall ever by construed as a waiver of
any right or remedy; and no exercise or enforcement of any such rights or
remedies shall ever be held to exhaust any night or remedy.
42. No Third Party Beneficiary. This Lease is for the sole benefit of
Landlord, its heirs, successors and assigns, and Tenant, its permitted
successors and assigns, and it is not for the benefit of any third party.
43. Number and Gender. Words of any gender used in this Lease shall be
held and construed to include any other gender, and words in the singular number
shall be held to include the plural, unless tile context otherwise requires.
Except where the context indicates otherwise, all of the terms, covenants and
conditions of this Lease for the Term hereof shall also apply to any Renewal
Term.
44. Force Majeure. Whenever a period of time is herein prescribed for
action to betaken by either party, such party shall not be liable or responsible
for, and there shall be excluded from the computation for any such period of
time, any delays due to strikes, riots, acts of God, shortages and/or
unavailability of labor or materials, war, governmental laws, regulations or
restrictions, or any other cause of any kind whatsoever which are beyond the
reasonable control of such party.
45. APPLICABLE LAW; CONSENT TO JURISDICTION. THIS LEASE SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS AND
THE LAWS OF THE UNITED STATES APPLICABLE TO TRANSACTIONS IN THE STATE OF TEXAS.
TENANT HEREBY IRREVOCABLY AGREES THAT ANY LEGAL ACTION OR PROCEEDING AGAINST IT
WITH RESPECT TO THIS LEASE MAY BE MAINTAINED IN THE COURTS OF DALLAS COUNTY,
TEXAS OR IN THE U.S. DISTRICT COURT FOR THE NORTHERN DISTRICT OF TEXAS, AND
TENANT HEREBY CONSENTS TO THE JURISDICTION AND VENUE OF SUCH COURTS.
IN WITNESS WHEREOF, this Lease Agreement, including the indemnity
provisions in Sections 4, 6, 7, 8, 20 and 31 and the disclaimer of Landlord
warranty in Section 21, is executed in multiple counterparts, all of which shall
together constitute one and the same original, and entered into by the parties
hereto on the day and year first set forth above.
LANDLORD:
MOTHER GOOSE CORPORATION,
a Texas corporation
By: /s/ John R. Krystinik
--------------------------------------------
John R. Krystinik, President
Address: 2201 River Hill Road
Dallas, Texas 75061
TENANT:
PRECISE MACHINE PARTNERS, L.L.P., a
Texas limited liability partnership
By: Precise Machine Company,
Managing Partner
By: /s/ Lawrence J. LeGrand
-----------------------------------
Printed Name: Lawrence J. LeGrand
Title: Executive Vice President
Address: 3600 Mueller Road
St. Charles, Missouri 63301
EXHIBIT "A" TO LEASE AGREEMENT
Legal Description
Being 2 tracts of land in the JESSE MOON SURVEY, Abstract No. 879, City of
Irving, Dallas County, Texas, and being more particularly described as follows:
Tract 1:
Being Lot 1, in Block A of SNEED ADDITION, an Addition to the City of Irving,
Dallas, County, Texas, according to the Map thereof recorded in Volume 79152,
Page 1378, Map Records of Dallas County, Texas.
Tract 2:
Being Lot 1, in Block A of HANDCRAFT ENGRAVING ADDITION, an Addition to the City
of Irving, Dallas County, Texas, according to the Map thereof recorded in Volume
87132, Page 996, Map Records of Dallas County, Texas.
EXHIBIT "B" TO LEASE AGREEMENT
Premises Rules and Regulations
1. Sidewalks, doorways, vestibules, corridors, stairways and other
similar areas shall not be obstructed by Tenant or used by Tenant for any
purpose other than ingress and egress to and from the Premises and for going
from or to another part of the Premises.
2. Plumbing fixtures and appliances shall be used only for the purposes
for which designed, and no sweepings, rubbish, rags or other unsuitable
materials shall be thrown or placed therein. Damage resulting to any such
fixtures or appliances or surrounding areas from misuse by Tenant shall be
repaired at the sole cost and expense of Tenant, and Landlord shall not in any
case be responsible therefor.
3. No signs, advertisements or notices shall be painted or affixed on
or to any windows or doors or other parts of the Premises except of such color,
size and style and in such places as shall be first approved in writing by
Landlord. No nails, hooks or screws shall be driven or inserted in any part of
the Premises except by the Premises personnel nor shall any part of the Premises
be defaced by Tenant. No curtains or other window treatments will be placed
between the glass and the Premises' window treatments.
4. Tenant shall not place any additional lock or locks on any doors in
or to the Premises without Landlord's prior written consent. A reasonable number
of keys to the locks on the doors which access the Premises shall be furnished
by Landlord to Tenant, and Tenant shall not have any duplicate keys made. Upon
termination of the Lease, Tenant shall return all keys to Landlord and shall
provide to Landlord a means of opening all safes, cabinets and vaults being left
with the Premises.
5. With respect to work being performed by Tenant in the Premises with
the approval of Landlord, Tenant will refer all contractors, contractor's
representatives and installation technicians rendering any service to them to
Landlord for Landlord's supervision, approval and control before the performance
of any contractual services. This provision shall apply to work performed in the
Premises including, but not limited to, installation of telephones, telegraph
equipment, electrical devices and attachments, and any and all installation of
even, nature affecting floors, walls, woodwork, trim, windows, ceilings,
equipment and any other physical portion of the Premises. Tenant must have
Landlord's written approval prior to employing any contractor. Any and all such
contractors shall comply with these Rules and Regulations for such services
including, but not limited to, insurance requirements. Any work in or on the
Premises shall comply with any and all codes.
6. Movement in or out of the Premises of furniture or office equipment
or other equipment, or dispatch or receipt by Tenant of any bulky materials,
merchandise or materials which require use of elevators or stairways, or hall
through the Premises entrances or lobby shall be restricted to such hours as
Landlord shall designate. All such movement shall be under the supervision of
Landlord and in the manner agreed between Tenant and Landlord by prearrangement
before performance. Such prearrangement initiated by Tenant will include
determination by Landlord, and subject to its decision and control, as to the
time, method and routing of movement and as to limitations for safety or other
concerns which may prohibit any article, equipment or any other item from being
brought into the Premises. Tenant is to assume all risk as to damage to articles
moved and injury to person or public engaged or not engaged in such movement,
including equipment, property and personnel of Landlord and other tenants if
damaged or injured as a result of acts in connection with carrying out this
service for Tenant from the time of entering the property to completion of work,
and Landlord shall not be liable for acts of any person engaged in, or any
damage or loss to any of said property or persons resulting from any act in
connection with such service performed for Tenant.
7. Landlord shall have the power to prescribe the weight and position
of safes and other heavy equipment, which shall, in all cases, be positioned to
distribute the weight and stand on supporting devices approved by Landlord. All
damage done to the Premises by taking in or putting out any property of Tenant,
or done by Tenant's property while in the Premises, shall be repaired at the
expense of Tenant.
8. Tenant shall employ cleaning and maintenance personnel for the
purpose of cleaning the Premises. Landlord shall be in no way responsible to
Tenant, its agents, employees or invitees for any loss of property from the
Premises or public areas or for any damage to any property thereon from any
cause whatsoever.
9. To insure orderly operation of the Premises, no ice, mineral or
other water, towels, newspapers, etc. shall be delivered to the Premises except
by persons appointed or approved by Landlord in writing.
10. Should Tenant require telegraphic, telephonic, annunciator or other
communication service, Landlord must approve where and how wires are to be
introduced and placed and none shall be introduced or placed except as Landlord
shall approve. Electric current shall not be used for power in excess of
standard office use or heating without Landlord's prior written permission.
11. Nothing shall be swept or thrown into the corridors, halls,
elevator shafts or stairways. No animals shall be brought into to kept in, on or
about the Premises.
12. No machinery shall be operated by Tenant in its Premises without
the prior written consent of Landlord except as necessary to Tenant's normal
business operations, nor shall Tenant use or keep in the Premises any flammable
or explosive fluid or substance.
13. No portion of the Premises shall at any time be used or occupied as
sleeping or lodging quarters.
14. Landlord will not be responsible for money, jewelry or other
personal property lost or stolen in or from the Premises or public areas
regardless of whether such loss or theft occurs when the area is locked against
entry or not.
15. The Premises shall not be occupied by an average of more than one
(1) person per 100 square feet of Rentable Space in the Premises without the
prior written consent of Landlord.
16. Landlord reserves the right to rescind any of these rules and
regulations and to make such other and further rules and regulations as in its
judgment shall from time to time be advisable for the safety, protection, care
and cleanliness of the Premises, the use and operation thereof, the preservation
of good order therein and the protection and comfort of the Tenant and its
agents, employees and invitees, which rules and regulations, when made and
written notice thereof is given to Tenant, shall be binding upon Tenant in like
manner as if originally herein prescribed.