Item 4I - MemoCity of Southlake Values:
Integrity ♦ Innovation ♦ Accountability ♦ Commitment to Excellence ♦ Teamwork
M E M O R A N D U M
November 7, 2023
To:
From:
Subject:
Shana Yelverton, City Manager
Robert Briggs, Operations Manager - Special Projects
Recommendation on City Council Agenda Item 4I - Approve a lease
agreement with KRG Town Square Ventures, LLC off-site office space.
Action
Requested:
Background
Information:
City Council Approval of lease agreement with KRG
Town Square Ventures, LLC for off-site office
space.
The City Library Staff has outgrown their work areas within Town
Hall. With the presence of City and County operations in Southlake
Town Hall there is no available space for the City Library staff to
expand to.
For this reason, at the direction of City Council, explored various
options to provide the City Library staff with ample workspace. Item
4I is the result of that search.
On August 16, 2023, at the direction of City Council, City Staff
completed submitted a Letter of Intent to lease from KRG Town
Square Ventures, LLC for a 2,762sqft. office space within Southlake
Town Square. Item 4I is the lease agreement for that space. A full
copy of the lease agreement is attached for reference and review.
Item 4I-1
Parks and Recreation Board
Meeting Date – October 09, 2023
Page 2 of 2
City of Southlake Values:
Integrity ♦ Innovation ♦ Accountability ♦ Commitment to Excellence ♦ Teamwork
Strategic Link:
Legal Review:
Alternatives:
Financial impact across the 3 year lease include an amount of
$8,631.25/mo, year 1 (FY24-25), $8,976.50/mo, year 2
(FY25-26), and $9335.56/mo, year 3 (FY26-27). Of which all have
been budgeted or accounted for.
Approval of this lease agreement is linked to the City’s Strategy Map
as it relates to the Focus Area of Performance Management &
Service Delivery.
City Council consideration of during executive sessions:
August 15, 2023 and October 17, 2023
City Attorney has reviewed the document.
Alternatives may include:
Supporting
Documents:
•Recommendation to approve as presented
•Recommendation to approve with input as desired
•Recommendation not to approve
Staff
Recommendation: Approve lease agreement with KRG Town Square Ventures, LLC.
Item 4I-2
Attached
Financial
Considerations:
2023-10-20 - Southlake Town Square - City of Southlake - Office Lease - Version 4 (KRG)
SOUTHLAKE TOWN SQUARE
OFFICE LEASE
Project: Southlake Town Square
Landlord: KRG Town Square Ventures, LLC
Tenant: The City of Southlake, Texas, a municipal corporation
i
INDEX TO LEASE
ARTICLE TITLE
PAGE
ARTICLE 1 DEFINITIONS AND CERTAIN BASIC PROVISIONS .................................................. 1
ARTICLE 2 GRANTING CLAUSE ....................................................................................................... 3
ARTICLE 3 DELIVERY OF PREMISES .............................................................................................. 3
ARTICLE 4 RENT .................................................................................................................................. 4
ARTICLE 5 OFFICE BUILDING SERVICES AND EXPENSES ........................................................ 5
ARTICLE 6 Intentionally Omitted ......................................................... Error! Bookmark not defined.
ARTICLE 7 COMMON AREA ............................................................. Error! Bookmark not defined.
ARTICLE 8 RESERVED ....................................................................... Error! Bookmark not defined.
ARTICLE 9 USE AND CARE OF DEMISED PREMISES .................. Error! Bookmark not defined.
ARTICLE 10 MAINTENANCE AND REPAIR OF DEMISED PREMISES ......................................... 9
ARTICLE 11 ALTERATIONS ................................................................ Error! Bookmark not defined.
ARTICLE 12 LANDLORD'S RIGHT OF ACCESS ............................... Error! Bookmark not defined.
ARTICLE 13 SIGNS; STORE FRONTS ................................................. Error! Bookmark not defined.
ARTICLE 14 UTILITIES......................................................................... Error! Bookmark not defined.
ARTICLE 15 INSURANCE COVERAGES ............................................ Error! Bookmark not defined.
ARTICLE 16 INDEMNIFICATION; WAIVER OF LIABILITY; MUTUAL WAIVER OF
SUBROGATION ............................................................................ Error! Bookmark not defined.
ARTICLE 17 DAMAGES BY CASUALTY ........................................... Error! Bookmark not defined.
ARTICLE 18 EMINENT DOMAIN ........................................................ Error! Bookmark not defined.
ARTICLE 19 ASSIGNMENT AND SUBLETTING .............................. Error! Bookmark not defined.
ARTICLE 20 SUBORDINATION; ATTORNMENT; ESTOPPELS ..... Error! Bookmark not defined.
ARTICLE 21 PARKING .......................................................................... Error! Bookmark not defined.
ARTICLE 22 DEFAULT BY TENANT OR LANDLORD AND REMEDIESError! Bookmark not
defined.
ARTICLE 23 Intentionally Omitted ......................................................... Error! Bookmark not defined.
ARTICLE 24 HOLDING OVER; SURRENDER OF PREMISES ......... Error! Bookmark not defined.
ARTICLE 25 NOTICES........................................................................... Error! Bookmark not defined.
ARTICLE 26 AMERICANS WITH DISABILITIES ACT ..................... Error! Bookmark not defined.
ARTICLE 27 REGULATIONS ............................................................... Error! Bookmark not defined.
ARTICLE 28 MISCELLANEOUS .......................................................... Error! Bookmark not defined.
Exhibit “A” Site Plan of the Project
Exhibit “B” Demised Premises
Exhibit “C” Construction: Building Office Shell
Exhibit “D” Prohibited and Restricted Uses
Exhibit “E” Relinquishment of Lien Rights
Exhibit “F” Sign Criteria
Exhibit “G” Tenant Estoppel Certificate
Exhibit “H” Intentionally Omitted
Exhibit “I” Intentionally Omitted
Exhibit “J” Communications Antenna
Exhibit “K” Rules and Regulations
1
OFFICE LEASE
ARTICLE 1
DEFINITIONS AND CERTAIN BASIC PROVISIONS
1.1 The following list sets out certain defined terms and certain financial and other
information pertaining to this lease, which is dated as of ______________, 2023, and such
defined terms shall, as used in this lease, have the meanings set forth below:
(a) “Landlord”: KRG Town Square Ventures , LLC
(b) Landlord’s address: c/o –Kite Realty Group, 30 South Meridian, Suite 1100,
Indianapolis, IN 46204, Attn: Legal Department
Rent Payment:
(if procedures for electronic payment are not in place)
Attn: Property Accountant
15105 Collection Center Drive
Chicago, IL 60693-5105
(c) “Tenant”: The City of Southlake, Texas, a municipal corporation
(d) Tenant’s address: 1400 Main Street, Suite 460, Southlake, Texas 76092
(e) Tenant’s trade name: The City of Southlake
(f) Intentionally Omitted
(g) “Agent”: Not applicable
(h) “Cooperating Agent”: Not applicable
(i) “Project”: Landlord’s property located in the City of Southlake, Tarrant County,
Texas, which property is described or shown on Exhibit “A” attached to this lease. With regard to
Exhibit “A”, the parties agree that the exhibit is attached solely for the purpose of locating the
Project and the Demised Premises within the Project and that no representation, warranty, or
covenant is to be implied by any other information shown on the exhibit (e.g., any information as
to buildings, tenants, or prospective tenants, etc. is subject to change at any time). Tenant
acknowledges that the Project is a mixed-use project combining retail and office space, often in the
same building. For the purposes of this lease, the second and, if applicable, third floor of the
building in which the Demised Premises are located together with the lobby on the first floor
serving such floor(s) and the elevators, mechanical, electrical and plumbing systems serving such
floor(s) are referred to as the “Office Building.” The lobbies and common corridors and restrooms
located within the Office Building (other than corridors and restrooms located entirely within or
serving only one tenant’s space) are referred to in this lease as the “Office Building Common Area.”
The common corridor on the first floor (as opposed to the lobby on the first floor) is part of the
Common Area of the Project and is not part of the Office Building Common Area.
(j) “Demised Premises”: an office unit in the Project containing approximately 2,402
square feet in usable area (measured by calculating lengths and widths to the exterior of outside
walls and to the center of interior walls) and being conclusively deemed to contain 2,762 square
feet of rentable area, being known as Space F150, Southlake, Texas 76092 and being described or
shown on Exhibit “B” attached to this lease.
(k) “Delivery Date”: The date Landlord notifies Tenant in writing that possession of
the Demised Premises is “ready for occupancy” (as that term is defined in Exhibit “C” attached to
this Lease), it being Landlord’s estimate that the Demised Premises will be “ready for occupancy”
on or before the date which is forty-five (45) days after the execution date of this Lease.
Notwithstanding the foregoing, in the event Tenant has failed to deliver to Landlord the Delivery
Items (as hereinafter defined) by the Delivery Date, Landlord shall have the right to delay “physical
turnover” of the Demised Premises to Tenant until Tenant has delivered the Delivery Items to
Landlord; provided, however, for all purposes of this Lease, the Delivery Date shall be deemed to
have occurred when Landlord was ready to deliver “physical turnover” of the Demised Premises
to Tenant pursuant to the terms of this Lease even though Landlord elected not to do so pending
receipt of the Delivery Items. As used herein, “Delivery Items” shall mean (a) executed copies of
policies of insurance or certificates thereof (as required of Tenant under Article 15); (b) final plans
and specifications for Tenant’s Work, as approved by Landlord; and (c) a copy of Tenant’s building
permit, if issued by such date. Landlord and Tenant acknowledge that a third party currently has a
leasehold interest in the Premises (the “Existing Tenant”). In the event that the Existing Tenant
has not vacated and surrendered the Premises to Landlord by the Delivery Date, Landlord shall
have the right to extend the Delivery Date on a day for day basis for each day Landlord delivers
after the Delivery Date.
(l) “Commencement Date”: The date that is the later of: a) October 1, 2023, or b) The
Delivery Date as set forth herein.
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(m) Lease Term and Renewal Option: Commencing on the Delivery Date and ending
on the last day of the month of December which follows thirty-six months after the Commencement
Date
(n) Minimum guaranteed rental: Tenant must pay to Landlord monthly the amount
set forth below:
Period
Monthly
Rental Rate
Months 1 - 12 $8,631.25
Months 13 - 24 $8,976.50
Months 25 through the
last day of the Lease
Term
$9,335.56
(o) Intentionally Omitted
(p) Termination of Lease for Non-appropriation of Funds: Notwithstanding any other
provisions contained within this Lease, Landlord and Tenant acknowledge that Tenant is a Texas
municipality that operates on a fiscal year from October 1 through September 30 of the following
year and must adopt a budget and allocate fund is accordance with the laws of the State of Texas.
The obligations of Tenant to make any payments to Landlord pursuant to this Lease are subject to
appropriation by Tenant of funds that are lawfully available to be applied for such purpose. Tenant
shall use its best efforts to obtain appropriation of funds for the purpose of funding its obligations
under this Lease for the entirety of the Term. If, despite Tenant’s best efforts, Tenant fails to make
an appropriation for payments prior to the beginning of a fiscal period of Tenant, Tenant may
terminate this Lease by providing written notice of such termination to Landlord not less than thirty
(30) days prior to the next October 1 together with a termination fee equal to the amount of
minimum guaranteed rental remaining through the end of the Term . Tenant will vacate the
Demised Premises prior to the first day of the fiscal year for which funds have not been
appropriated.
(q) Permitted use: Tenant and Tenant’s permitted sublessees and assignees shall use
and occupy the Demised Premises solely for the following purpose(s): for the use as private
professional offices or lounges and for no other use whatsoever. Tenant shall not be permitted to
offer the Demised Premises for use by patrons or visitors of the Shopping Center, no r patrons of
the library. In no event may Tenant or any occupant use the Demised Premises for any purpose that
violates any of the prohibited or restricted uses listed on Exhibit “D” of this lease. Tenant
acknowledges and agrees that Tenant’s use of the Demised Premises is subject to the terms and
provisions of that certain Second Amended and Restated Declaration of Covenants, Restrictions
and Easements for Southlake Town Square dated October 18, 2006 and recorded as Instrument No.
D206334031 of the Official Records of Tarrant County, Texas (as amended from time to time, the
“CREs”) which among other things, requires Development Control Committee approval f or any
use of the Demised Premises, in accordance with the procedures and standards more particularly
described in the CREs, and Tenant covenants and agrees with Landlord that Tenant will not use the
Demised Premises for any purpose which is not so approved by the Development Control
Committee.
Tenant acknowledges that the above specification of a “permitted use” means only that
Landlord has no objection to the specified use and does not include any representation or warranty
by Landlord as to whether or not such specified use complies with applicable laws and/or requires
particular governmental permits. In this regard Tenant acknowledges that this Section 1.1(q) is
subject to Article 3 and Section 9.7 of this lease.
(r) Tenant’s Proportionate Share: A percentage, the numerator of which is the number
of usable square feet in the Demised Premises and the denominator of which is the number of usable
square feet in the gross leased and occupied area of the Project to which the applicable cost or
expense applies (it being understood and agreed that for tenants on the first floor, the number of
rentable square feet is the same as the number of square feet in their premises (a ll of which are
deemed usable)). Notwithstanding the above, as to charges for which such percentage, when
applied uniformly, would have an inequitable result, Landlord will determine the percentage that
Landlord reasonably deems to be equitable. As an example of Landlord’s ability to allocate costs
to the premises to which they apply, liability insurance is allocated to the entire Project, so Tenant’s
2023-10-20 - Southlake Town Square - City of Southlake - Office Lease - Version 4 (KRG) 3
Proportionate Share of the cost of liability insurance would be an amount determined by
multiplying such cost by a fraction, the numerator of which is the number of usable square feet in
the Demised Premises and the denominator of which is the number of usable square feet in the
Project (determined as set forth above). On the other hand, Landlord only provides janitorial
service to the tenants of the Office Building, so that Tenant’s Proportionate Share of that cost would
be an amount determined by multiplying such cost by a fraction, the numerator of which is the
number of usable square feet in the Demised Premises and the denominator of which is the number
of usable square feet in the Office Building. As an example of Landlord’s ability to modify a
tenant’s proportionate share in order to obtain a more equitable result, if one tenant of the Office
Building did not use the janitorial service in such tenant’s premises at all (for example, if the tenant
were a jeweler and did not want janitorial workers to have access to its premises), then such tenant
would not pay for the janitorial cost that Landlord allocates to such tenant’s premises, but would
pay the janitorial cost that Landlord allocates to janitorial work in the Office Building Common
Area, and the proportionate share of such costs for the other tenants of the Office Building would
be modified accordingly.
(s) Lease Year: The first “Lease Year” shall begin on the Commencement Date and
end on the succeeding December 31. The next “Lease Year” shall be the twelve (12) calendar
month period following the first Lease Year. Each succeeding “Lease Year” during the lease term
shall be each successive 12 calendar month period. If this lease terminates or expires on a date
other than December 31, the final Lease Year shall be the time period beginning on January 1 of
the year of expiration or termination and ending on the date of termination or expiration.
1.2 The following chart is provided as an estimate of Tenant’s initial monthly payment
broken down into its components. This chart, however, does not supersede the specific provisions
contained elsewhere in this lease:
Initial Minimum Guaranteed Rental
(Section 1.1(n)) $8,631.25, per
month
Total Initial Monthly Payment $8,631.25
ARTICLE 2
GRANTING CLAUSEError! Bookmark not defined.
Landlord leases the Demised Premises to Tenant, and Tenant hereby leases the Demised Premises
from Landlord, subject to and upon the terms and conditions set forth in this lease and subject to the rights
and interests of third parties under existing liens, ground leases, easements and encumbrances affecting the
Project or any part thereof, public right-of-ways, all zoning regulations, rules, ordinances, building
restrictions and other laws and regulations now in effect or hereafter adopted by any governmental authority
having jurisdiction over the Project or any part thereof.
ARTICLE 3
DELIVERY OF PREMISESError! Bookmark not defined.
Except as otherwise expressly set forth in this Lease, the Demised Premises is being leased “AS
IS,” with Tenant accepting all defects, if any; and Landlord makes no warranty of any kind, express or
implied, with respect to the Demised Premises (without limitation, Landlord makes no warranty as to the
habitability, fitness or suitability of the Demised Premises for a particular purpose nor as to the absence of
any toxic or otherwise hazardous substances). This Article 3 is subject to any contrary requirements under
applicable law; however, in this regard Tenant acknowledges that it has been given the opportunity to
inspect the Demised Premises and to have qualified experts inspect the Demised Premises prior to the
execution of this lease. Conference Room furniture and appliances shall remain the property of Landlord
and shall remain in the Demised Premises following the expiration or earlier termination of the Lease
2023-10-20 - Southlake Town Square - City of Southlake - Office Lease - Version 4 (KRG) 4
ARTICLE 4
RENTError! Bookmark not defined.
4.1 Rental accrues from the Commencement Date. All payments of Rental shall be made
electronically via Landlord’s online portal (the “Portal”) (or such other place or method as may be
designated by Landlord in writing from time to time). Tenant shall, promptly following execution hereof,
enroll in Landlord’s Portal in order to receive statements from Landlord and to pay to Landlord all Rent al
and other charges and render to Landlord all statements herein prescribed. Tenant shall provide to Landlord
a point of contact and follow enrollment instructions provided by Landlord to enroll in the Portal. If
payment through the Portal or other electronic means shall not be in place, then payment of Rental may be
made to Landlord by check or other physical means at the address listed in Section 1.1(b), or any other
address designated by Landlord upon five (5) days’ notice to Tenant.
4.2 Tenant must pay to Landlord minimum guaranteed rental in monthly installments in the
amounts specified in Section 1.1(n) of this lease. The first such monthly installment is due and payable on
or before the Commencement Date, and subsequent installments are due and payable on or before the first
day of each succeeding calendar month during the lease term; provided that if the Commencement Date is
a date other than the first day of a calendar month, Tenant must pay on or before such date as minimum
guaranteed rental for the balance of such calendar month a sum equal to that proportion of the rent specified
for the first full calendar month as herein provided, which the number of days from the Commencement
Date to the end of the calendar month during which the Commencement Date falls bears to the total number
of days in such month.
4.3 It is understood that the minimum guaranteed rental is payable on or before the first day of
each calendar month (in accordance with Section 4.1 and Section 4.2 above), without offset or deduction
of any nature. In the event any rental or other amount owed to Landlord (including, without limitation, any
amounts owed under the terms of this Article 4, or under Article 6, Article 7, or Article 8 below) is not
received by Landlord before the date which is ten (10) days after such amount’s due date, for an y reason
whatsoever, or if any payment for such an amount is by check which is returned for insufficient funds, then
in addition to the past due amount, Tenant must pay to Landlord one of the following (the choice to be at
the sole option of the Landlord unless one of the choices is improper under applicable law, in which event
the other alternative will automatically be deemed to have been selected): (a) a late charge in an amount
equal to ten percent (10%) of the rental or other amount then due, in order to compensate Landlord for its
administrative and other overhead expenses; or (b) interest on the rental or other amount then due at the
maximum contractual rate which could legally be charged in the event of a loan of such amount to Tenant
(but in no event to exceed 1½% per month), such interest to accrue continuously on any unpaid balance
during the period commencing with the due date of such rental or other amount and terminating with the
date on which Tenant makes full payment of all amounts owing to Landlord at the time of such payment.
Any such late charge or interest payment is payable as additional rental under this lease and is payable
immediately on demand. If any payment for rental or other amount owed to Landlord (including, without
limitation, any amounts owed under the terms of this Article 4, or under Article 6, Article 7, or Article 8
below) is by check which is returned for insufficient funds, Tenant must immediately make the required
payment to Landlord in good funds; moreover, Tenant must also pay to Landlord all other amounts specified
by the terms of this lease (including, without limitation, interest or other charges required under the terms
of this Article 4, or under Article 6, Article 7, or Article 8 below), plus an additional fee of $50.00 to
compensate Landlord for its expense and effort in connection with the dishonored check.
4.4 Intentionally Omitted
4.5 If Tenant fails in two consecutive months to make rental payments within ten days after
due, Landlord, in order to reduce its administrative costs, may require, by giving written notice to Tenant
(and in addition to any late charge or interest accruing pursuant to Section 4.3 above, as well as any other
rights and remedies accruing pursuant to Article 22 below, or any other provision of this lease or at law),
that minimum guaranteed rentals are to be paid quarterly in advance instead of monthly and that all future
rental payments are to be made on or before the due date by cash, cashier’s check or money order and that
the delivery of Tenant’s personal or corporate check will no longer constitute a payment of rental as
provided in this lease. Any acceptance of a monthly rental payment or of a personal or corporate check
thereafter by Landlord cannot be construed as a subsequent waiver of such rights.
4.6 Landlord and Tenant agree that each provision contained in this Lease for determining any
rent payments is commercially reasonable and, as to each such charge or amount, constitutes a “method by
which the charge is to be computed” for purposes of Tex. Prop. Code Ann. §93.012, as enacted by House
Bill 2186, 77th Legislature.
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ARTICLE 5
OFFICE BUILDING SERVICES AND EXPENSESError! Bookmark not defined.
5.1 Landlord agrees to furnish to Tenant while Tenant is occupying the Demised Premises in
accordance with the terms of this lease, all of the following services:
(a) Janitorial cleaning services and garbage and trash removal and, if Landlord deems
it appropriate, removal of recycled items, for the Demised Premises and the Office Building
Common Area on a standard five (5) day week basis; provided, however, that if Tenant’s floor
coverings or other improvements are other than building standard, Tenant must pay, as additional
rent, the additional cleaning cost incurred in cleaning such carpets and other improvements. Tenant
must pay such additional rent within thirty (30) days after Landlord delivers a statement of such
cost to Tenant.
(b) Elevator service (without an operator) in common with other tenants of the Office
Building; provided, however, that Landlord may reasonably limit the number of elevators in
operation on Saturdays, Sundays, and State and Federal holidays.
(c) Hot and cold potable water, sewer, and electricity to the Office Building. The
electrical facilities will not exceed one watt per square foot of usable area per month and if Tenant’s
electrical usage requires more than such total wattage, includes any single machine that consumes
more than 0.5 kilowatts at rated capacity per month, or requires a voltage other than 120 volts or if
such equipment requires additional air conditioning above that required by the building standard
system, then Tenant must pay for the additional electric power source and usage, the different
wiring, and the additional air conditioning usage. Landlord may, in such event, require that Tenant
install additional air conditioning equipment serving only the Demised Premises and an additional
meter to measure its electrical consumption.
(d) Heated and refrigerated air conditioning in season, to temperatures, and during
hours established by Landlord for the Demised Premises and the Office Building Common Area
(but not less than 7:00 a.m. through 6:00 p.m. Monday through Friday (excepting State and Federal
holidays) and 9:00 a.m. through 2:00 p.m. on Saturdays (again, excepting State and Federal
holidays)); provided, however, that Tenant will be entitled to receive heated or refrigerated air
conditioning, during their respective seasons, at hours in which Landlord does not customarily
provide such heated or refrigerated air conditioning if, and only if, Tenant pays to Landlord
Landlord’s customary charge per hour of use (with a 2-hour minimum) for such heated or
refrigerated air conditioning service (which charge may include a required minimum number of
hours and may be based on the area of the Demised Premises or the area served by the same heating,
air conditioning, and ventilating units as the Demised Premises). The term “State and Federal
holidays” means New Year’s Eve, New Year’s Day, Memorial Day, Fourth of July, Labor Day,
Thanksgiving Day, Christmas Eve, Christmas Day and, if any of the foregoing days is followed or
preceded by a Monday, or followed or preceded by a Friday, such Monday or Friday.
(e) Routine maintenance and repair of the Office Building Common Area.
(f) Routine maintenance and repair of the heating, air conditioning, and ventilating
system and the lighting, water, and electrical systems serving the Demised Premises and
replacement of building standard fluorescent bulbs in all areas and incandescent bulbs in the Office
Building Common Area.
5.2 Landlord does not warrant that any of the above-described services will be free from
interruption or stoppage. No partial or complete failure to furnish such services nor any stoppage or
interruption of such services will render Landlord liable in any respect for damages to person, property or
business. In the event any of the services provided by Landlord are not provided due to the gross negligence
or willful misconduct of Landlord in excess of seventy-two (72) hours, such charge for said services shall
abate. No interruption, stoppage or failure of such services will be deemed or construed as an eviction,
actual or constructive, of Tenant nor work an abatement of rent nor relieve Tenant from the obligation to
fulfill any covenant or agreements contained in this lease, including, without limitation, the obligation to
pay rent.
5.3 In addition to the rentals and other charges prescribed in this lease Tenant must pay to
Landlord Tenant’s Office Building Proportionate Share of the cost of operation and maintenance of the
Office Building (including, without limitation the Office Building Common Area), including, among other
costs, costs incurred in providing the services described above. With regard to capital expenditures (i) the
original investment in capital improvements. i.e., upon the initial construction of the Project, cannot be
2023-10-20 - Southlake Town Square - City of Southlake - Office Lease - Version 4 (KRG) 6
included, and (ii) improvements and replacements, to the extent capitalized on Landlord’s records can be
included only to the extent of a reasonable depreciation or amortization (including interest accruals
commensurate with Landlord’s interest costs). “Tenant’s Office Building Proportionate Share” is the ratio
that the total usable floor area of the Demised Premises bears to the total usable floor area of the Office
Building. If this lease should commence on a date other than the first day of a calendar year or terminate
or expire on a date other than the last day of a calendar year, Tenant’s reimbursement obligations under this
Section 5.3 will be prorated based upon Landlord’s expenses for the entire calendar year. Tenant must
make such payments to Landlord on demand, at intervals not more frequent than monthly. Landlord and
Tenant acknowledge that the costs referenced in this Section 5.3 are in addition to those referenced in
Section 7.4, which means, among other things that (i) certain costs typically included in the cost of operation
and maintenance of any office building are passed through to Tenant under Section 7.4 (such as, by way of
example only, parking costs, landscaping costs, and security costs, if any); and (ii) no cost may be passed
through to Tenant under Section 7.4 and this Section 5.3 in such a manner that Tenant pays for the same
cost more than once (although Landlord may allocate a portion of certain costs to the Office Building
Common Area and the remainder to the Common Area as long as Landlord’s recovery of that cost does not
exceed the actual amount of such cost). Landlord represents and warrants that all charges for services
represented in this Article 5 (except for any late fees or other like fees otherwise incurred and due by Tenant)
shall be included in Tenant’s payment of rental required hereunder.
ARTICLE 6 Intentionally Omitted
ARTICLE 7
COMMON AREA
7.1 The term “Common Area” is defined for all purposes of this lease as that part of the Project
intended for the common use of all tenants and the public which is maintained by Landlord or the expense
of which is borne in whole or in part by Landlord, including among other facili ties (as such may be
applicable to the Project), parking areas, streets and alleys, common open spaces, landscaping, curbs,
loading areas, sidewalks and streetscapes, malls and promenades (enclosed or otherwise), lighting facilities,
drinking fountains, meeting rooms, public toilets, and the like but excluding (i) space in buildings (now or
hereafter existing) designated for rental for commercial purposes, as the same may exist from time to time,
(ii) areas within the Project which may from time to time not be owned by Landlord (unless subject to a
cross-access or similar agreement benefitting the area which includes the Demised Premises), (iii) areas
leased to a single-purpose user (such as a bank or a fast-food restaurant) where access is restricted, (iv) the
roof(s) of the building(s) in the Project, and (v) decorative awnings; provided, however, that if Landlord
bears all or any portion of the cost of maintaining, repairing, or replacing any of the areas described in
clauses (ii) through (v) of the immediately-preceding sentence, such areas, while not technically
constituting part of the Common Area, will be deemed included within the Common Area for the purposes
of (1) Landlord’s ability to prescribe rules and regulations regarding same, and (2) their inclusion for
purposes of common area maintenance cost reimbursements. Landlord reserves the right to change from
time to time the dimensions and location of the Common Area, as well as the dimensions, identities,
locations and types of any buildings, signs or other improvements in the Project. For example, and without
limiting the generality of the immediately preceding sentence, Landlord may from time to time decrease
the size of any parking area or substitute for any parking area other areas reasonably accessible to the tenants
of the Project, which areas may be elevated, surface or underground.
7.2 Tenant, and its employees and customers, and when duly authorized pursuant to the
provisions of this lease, its subtenants, licensees and concessionaires, have the nonexclusive right to use the
Common Area as constituted from time to time, such use to be in common with Landlord, other tenants in
the Project and other persons permitted by Landlord to use the same, and subject to such reasonable rules
and regulations governing use as Landlord may from time to time prescribe. For example, and without
limiting the generality of Landlord’s ability to establish rules and regulations governing all aspects of the
Common Area, Tenant agrees as follows:
(a) Tenant is not permitted to solicit business, or distribute leaflets or other materials
in the Common Area nor take any action which in the sole and exclusive judgment of Landlord
would constitute a nuisance or would disturb, endanger, or interfere with the rights of other persons
to use the Common Area or would tend to injure the reputation of the Project.
(b) Landlord may temporarily close any part of the Common Area for such periods of
time as may be necessary to make repairs, alterations, or improvements, or to prevent the public
from obtaining prescriptive rights.
(c) With regard to the roof(s) of the building(s) in the Project, use of the roof(s) is
reserved to Landlord or, with regard to any tenant demonstrating to Landlord’s satisfaction a need
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to use same, to such tenant after receiving prior written consent from Landlord. Subject to
Landlord’s approval, Tenant shall be allowed access to the roof in order to install, replace, repair,
and maintain any heating and air conditioning rooftop unit which exclusively serves the Demised
Premises (“Rooftop Equipment”). Tenant shall be allowed to place one (1) satellite dish
(“Antenna”), as more particularly described on Exhibit “J” attached hereto, on the roof above
Tenant’s Demised Premises provided that the installation and operation thereof and all maintenance
and repair is performed in accordance with all applicable laws, rules and regulations and the terms
and provisions for Communication Antenna set forth on Exhibit “J” attached hereto. With respect
to Rooftop Equipment, Landlord shall provide reasonable access thereto to Tenant and Tenant’s
contractors, subject to Landlord’s rules and regulations regarding controlled access to the roof.
Tenant’s access to the Rooftop Equipment must be coordinated through Landlord and Landlord’s
representative may accompany any of Tenant’s contractors or Tenant during such access. Any
penetrations of the building roof must be performed by a c ontractor designated by Landlord so as
to maintain the building roof warranties. Landlord may elect to perform any of such work which
affects building systems with its own personnel or contractors, and Tenant shall promptly reimburse
Landlord therefor, as additional rent. Tenant shall maintain the Rooftop Equipment in accordance
with the requirements of the insurers of the building and with reasonable rules, regulations and
technical standards of Landlord relating to use of the building roof as Landlord may establish from
time to time. Tenant shall maintain the Rooftop Equipment in good working order and repair, and
shall keep the area immediately surrounding the Rooftop Equipment neat and clean. Tenant’s use
and maintenance of the Rooftop Equipment may not create any nuisance or interfere with any other
licensee or tenant of the Building. Landlord has no obligation to maintain, operate or safeguard the
Rooftop Equipment. IN ADDITION TO THE INDEMNIFICATION OBLIGATIONS OF THE
PARTIES UNDER ARTICLE 16 BELOW, TO THE EXTENT PERMITTED BY LAW, IF ANY,
TENANT SHALL INDEMNIFY, DEFEND AND HOLD HARMLESS LANDLORD FROM
ANY AND ALL CLAIMS, DEMANDS, LIABILITIES, CAUSES OF ACTIONS, SUITS,
JUDGMENTS, AND EXPENSES (INCLUDING REASONABLE ATTORNEYS’ FEES,
COURT COSTS AND COSTS OF INVESTIGATION) ARISING FROM OR IN CONNECTION
WITH THE INSTALLATION, CONDITION, OPERATION, REPAIR AND MAINTENANCE
OF THE ANTENNA AND ROOFTOP EQUIPMENT, EVEN IF SUCH CLAIMS, DEMANDS,
LIABILITIES, CAUSES OF ACTION, SUITS, JUDGMENTS AND EXPENSES ARE
ATTRIBUTABLE TO THE CONCURRENT NEGLIGENCE OF LANDLORD.
(d) Landlord may seasonally place kiosks or allow the placement of vending carts in
and around the Common Area in accordance with applicable governmental laws, rules and
regulations.
7.3 Landlord is responsible for the operation, management and maintenance of the Common
Area, the manner of maintenance and the expenditures therefor to be in the sole discretion of Landlord, but
to be generally in keeping with similar projects within the same geographical area as the Project.
7.4 In addition to the rentals and other charges prescribed in this lease Tenant must pay to
Landlord Tenant’s Proportionate Share of the cost of operation and maintenance of the Common Area
which may be incurred by Landlord in its discretion, including, among other costs, those for lighting,
painting, cleaning, landscaping (including landscaping of any common open spaces maintained by Landlord
or for whose maintenance Landlord pays), parking (including valet parking), policing (to the extent that
security is provided by or otherwise arranged for by Landlord, although Landlord has no obligation to do
so), seasonal decoration, inspecting, repairing, replacing, of any portion of the Common Area, operation of
the central portion and water lines of any split heating, air conditioning and ventilating systems; trash
removal for the Common Area (to the extent not covered by the terms of Section 9.5 below); a reasonable
portion of whatever management fee Landlord pays to the manager of the Project, a reasonable allowance
for Landlord’s overhead costs and the cost of any insurance for which Landlord is not reimbursed pursuant
to Section 6.2, but specifically excluding all expenses paid or reimbursed pursuant to Article 6. With regard
to capital expenditures (i) the original investment in capital improvements, i.e., upon the initial construction
of the Project, cannot be included, and (ii) improvements and replacements, to the extent capitalized on
Landlord’s records may be included only to the extent of a reasonable depreciation or amortization
(including interest accruals commensurate with Landlord’s interest costs). If this lease should commence
on a date other than the first day of a calendar year or terminate or expire on a date other than the last day
of a calendar year, Tenant’s reimbursement obligations under this Section 7.4 will be prorated based upon
Landlord’s expenses for the entire calendar year. Tenant must make such payments to Landlord on demand,
without offset or deduction, at intervals not more frequent than monthly. Landlord represents and warrants
that payments required as set forth in this Article 7.4 (except for any late fees or other like fees otherwise
incurred and due by Tenant) shall be included in Tenant’s payment of Rental as required hereunder.
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ARTICLE 8
RESERVED
ARTICLE 9
USE AND CARE OF DEMISED PREMISES
9.1 Tenant must commence business operations in the entirety of the Demised Premises on or
immediately after the Commencement Date and must operate its business in an efficient, high class and
reputable manner. Tenant must not at any time leave the Demised Premises vacant, but must in good faith
continuously throughout the term of this lease conduct and carry on in the entire Demised Premises the type
of business for which the Demised Premises is leased. Tenant must, except during reasonable periods for
repairing, cleaning and decorating, keep the Demised Premises open to the public for business with
adequate personnel in attendance on all business days, except to the extent Tenant may be prohibited from
being open for business by applicable law, ordinance or governmental regulation.
9.2 The Demised Premises may be used only for the purpose or purposes specified in Section
1.1(q) above, and only under the trade name specified in Section 1.1(e) above (or, if Section 1.1(e) is not
filled in, any trade name approved in advance in writing by Landlord), and for no other purpose and under
no other trade name, it being understood and acknowledged that Landlord has entered into this lease in
large part because it believes that such use and trade name will benefit the Project as a whole.
9.3 Tenant must not, without Landlord’s prior written consent, keep anything within the
Demised Premises or use the Demised Premises for any purpose which creates a risk of toxic or otherwise
hazardous substances, or which increases the insurance premium cost or invalidates any insurance policy
carried on the Demised Premises or other parts of the Project. All property kept, stored or maintained
within the Demised Premises by Tenant is at Tenant’s sole risk. Tenant shall indemnify Landlord and hold
Landlord harmless from and against any and all liability, liens, claims, demands, damages, expenses, fees,
costs, fines, penalties, suits, proceedings, actions and causes of action (including without limitation all
attorneys’ fees and expenses) arising out of or relating to, directly or indirectly, any violation or alleged
violation by Tenant of any law, rule, regulation, order or determination of any government authority
pertaining to health or the environment relating to the Demised Premises and the Project (“Environmental
Laws”), now existing or hereafter arising, except for violations of Environmental Laws caused by Landlord.
This indemnification survives the expiration or termination of this lease. Tenant must immediately notify
Landlord if Tenant suspects, discovers or receives notice of any violation of Environmental Laws at the
Demised Premises or the Project, and must cooperate with Landlord in identifying and investigating any
such violation or suspected violation. Tenant further agrees to abide by the terms of any and all protocols,
procedures and agreements of which Landlord gives Tenant written notice and which address the detection,
management or remediation of environmental or health hazards at the Demised Premises or the Project.
9.4 Tenant must not permit any objectionable noises or odors to emanate from the Demised
Premises; nor place or permit any radio, television, loudspeaker or amplifier on the roof or outside the
Demised Premises or where the same can be seen or heard from outside the building; nor place any antenna,
equipment, awning, fixture or other projection on the exterior of or above the Demised Premises; nor take
any other action which would constitute a nuisance or would disturb or endanger other tenants of the Project
or unreasonably interfere with their use of their respective demised premises; nor permit any unlawful or
immoral practice to be carried on or committed on the Demised Premises; nor do anything which would
tend to injure the reputation of the Project.
9.5 Tenant must take good care of the Demised Premises, keep the Demised Premises secure
(Tenant acknowledges that it is not relying on any representation or warranty of Landlord in this regard),
and keep the Demised Premises free from waste at all times. Tenant at all times must not overload the
floors in the Demised Premises, nor deface or injure the Demised Premises. Tenant at all times must keep
the Demised Premises neat, clean and free from dirt and rubbish. Tenant must receive and deliver goods
and merchandise and remove garbage and trash in the frequency, schedule, manner, and areas Landlord
prescribes. Tenant must not operate an incinerator or burn trash or garbage within the Project.
9.6 Tenant must include the address and identity of its business activities in the Demised
Premises in all advertisements made by Tenant in which the address and identity of any similar local
business activity of Tenant is mentioned.
9.7 Tenant must procure at its sole expense any permits and licenses required for the
transaction of business in the Demised Premises and otherwise comply with all applicable laws, ordinances
and governmental regulations. In addition, if the nature of Tenant’s business makes it advisable for Tenant
to take any extra precautions (for example, in the case of a business which is affected by so-called “dram
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shop” laws, Tenant’s compliance with all “dram shop” educational programs and procedures), Tenant must
take all such extra precautions. At Landlord’s request, Tenant must deliver to Landlord copies of all such
permits and licenses and proof of Tenant’s compliance with all such laws, ordinances, governmental
regulations and extra precautions.
9.8 Tenant will comply with such rules and regulations (the “Rules and Regulations”)
generally applying to tenants in the Office Building as may be adopted from time to time by Landlord for
the management, safety, care and cleanliness of, and the preservation of good order and protection of
property in, the Premises and the Office Building and at the Project. All such Rules and Regulations are
hereby made a part hereof. The Rules and Regulations in effect on the date hereof are attached hereto as
Exhibit “K”. All changes and amendments to the Rules and Regulations sent by Landlord to Tenant in
writing and conforming to the foregoing standards shall be carried out and observed by Tenant. Landlord
hereby reserves all rights necessary to implement and enforce the Rules and Regulations.
9.9 (a) Tenant shall comply with the conservation, use and recycling policies and practices
from time to time established by Landlord for the use of utilities and services supplied by Landlord, and
the utility charges payable by Tenant hereunder may include such excess usage penalties or surcharges as
may from time to time be established by Landlord for the Office Building. Landlord may reduce the utilities
supplied to the Demised Premises, the Office Building and/or the Project as required or permitted by any
mandatory or voluntary water, energy or other conservation statute, regulation, order or allocation or other
program. Landlord and Tenant shall provide a point of contact to discuss issues related to sustainability
and energy, which may include, but are not limited to, retrofit projects, billing issues, energy efficiency
upgrades and data access.
(b) The Office Building and/or the Project is, or may become in the future, certified under
certain Sustainability Ratings or operated pursuant to Landlord’s sustainable building practices, as same
may be in effect or modified from time to time. Landlord’s sustainability practices address, without
limitation, whole-building operations and maintenance issues including chemical use; indoor air quality;
energy efficiency; water efficiency; recycling programs; exterior maintenance programs; and systems
upgrades to meet green building energy, water, indoor air quality, and lighting performance standards. All
of Tenant’s construction and maintenance methods and procedures, material purchases, and disposal of
waste must be in compliance with minimum standards and specifications as outlined by the Sustainability
Ratings (“Sustainability Rules”), in addition to all laws. This section shall apply to any relevant and
commercially reasonable Sustainability Rules that are provided to Tenant by Landlord in writing. Tenant
acknowledges that the Sustainability Rules may change throughout the Term of this Lease, but such
changes, if to be applied to this Lease, must be provided by Landlord to Tenant in writing, must be
commercially reasonable and shall not be retroactively applied to any work or actions already done or taken
by Tenant prior to Tenant’s receipt of such written notice of any changes to the Sustainability Rule. For
purposes of this Lease, “Sustainability Ratings” shall mean any one or more of the following ra tings, as
same may be in effect or amended or supplemented from time to time: The U.S. EPA’s Energy Star®
rating and/or Design to Earn Energy Star, the Green Building Initiative’s Green GlobesTM for Continual
Improvement of Existing Buildings (Green GlobesTM-CIEB), the U.S. Green Building Council’s
Leadership in Energy and Environmental Design (LEED) rating system, LEED EBOM (existing buildings
operations and maintenance) and any applicable substitute third party or government-mandated rating
systems.
(d) If requested, Landlord shall provide Tenant with The U.S. EPA’s Energy Star® rating if
the Office Building and/or the Project is eligible for a score. Tenant shall be required to submit on a periodic
basis to Landlord, within ten business days after Landlord’s request, energy and water consumption data,
including total usage and total charges as they appear on Tenant’s electric, gas, water, and other utility bills,
in a format deemed reasonably acceptable by Landlord. To the extent Tenant obtains electricity
independently of the Project, Tenant shall give Landlord access to Tenant’s data on energy use for inclusion
in Landlord’s annual reports, the Energy Star® annual rating and similar purposes.
ARTICLE 10
MAINTENANCE AND REPAIR OF DEMISED PREMISESError! Bookmark not defined.
10.1 Landlord must keep the foundation, the exterior walls (except signs, placards, decorations
or other advertising media of any type; and interior painting or other treatment of exterior walls) and roof
(subject to the first sentence in Section 7.1 above), all mechanical, electrical, and plumbing systems, and
the heating, air conditioning, and ventilating systems of or serving the Demised Premises in good repair.
In the event any heating or air conditioning is provided by a system that Tenant uses in common with other
occupants of the Project, then Landlord will perform the maintenance and repair for such system. Landlord,
however, is not required to make any repairs occasioned by the act or negligence of Tenant, its agents,
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employees, subtenants, licensees and concessionaires (including, but not limited to roof leaks resulting from
any roof penetration or placement), although Landlord may do so and bill Tenant for the cost as additional
rent, due thirty (30) days after Landlord delivers such bill to Tenant. The provisions of the first sentence
of this Section 10.1 are expressly recognized to be subject to the provisions of Article 3, Article 17 and
Article 18 of this lease. In the event that the Demised Premises should become in need of repairs required
to be made by Landlord hereunder, Tenant must give immediate written notice thereof to Landlord and
Landlord will have a reasonable time after receipt by Landlord of such written notice in which to make such
repairs.
10.2 Tenant must keep the Demised Premises in good, clean and habitable condition and must
make all repairs and replacements to those mechanical, electrical, plumbing, heating, and air conditioning
systems of or exclusively serving the Demised Premises. Tenant shall further maintain and repair all
supplemental HVAC units, data and phone cabling, and any and all other installations and equipment
installed in the Demised Premises, above the acoustical ceiling tiles of the Demised Premises or elsewhere
in the Building installed by or on behalf of Tenant and which services only the Demised Premises. If any
repairs required to be made by Tenant hereunder are not made within ten days after written notice delivered
to Tenant by Landlord or, in the case of a situation which by its nature requires an immediate response or
a response within less than ten (10) days, Landlord may at its option make such repairs without liability to
Tenant for any loss or damage which may result to Tenant’s stock or business by reason of such repairs;
and Tenant must pay to Landlord upon demand, as additional rental hereunder, the cost of such repairs plus
interest at the maximum contractual rate which could legally be charged in the event of a loan of such
payment to Tenant (but in no event to exceed 1½% per month), such interest to accrue continuously from
the date of payment by Landlord until repayment by Tenant. At the termination or expiration of this lease,
Tenant must surrender the Demised Premises in good condition, excepting rea sonable wear and tear and
losses required to be restored by Landlord in Section 10.1, Article 17 and Article 18 of this lease.
Notwithstanding anything contained herein to the contrary, Landlord shall be responsible for replacements
of lamps in the lighting systems in the Demised Premises. Additionally, Landlord shall be responsible for
maintaining the HVAC systems serving the Building that Tenant uses in common with other tenants.
ARTICLE 11
ALTERATIONS
11.1 Tenant must not make any alterations, additions or improvements to the Demised Premises
without the prior written consent of Landlord (including, without limitation, consent as to all plans and
specifications therefor and contractor(s) to be used or employed with respect thereto), except for the
installation of unattached, movable trade fixtures which may be installed without drilling, cutting or
otherwise defacing the Demised Premises and which are not visible from the exterior of the Demised
Premises.
11.2 All construction work done by Tenant within the Demised Premises must be performed in
a good workmanlike manner, lien-free and in compliance with all governmental requirements and all
approved plans and specifications therefor, and in such manner as to cause a minimum of interference with
other construction in progress and with the transaction of business in the Project, and Tenant must procure
and/or cause its contractor to maintain the insurance described in Exhibit “C” to this Lease and provide
Landlord with certificates of insurance evidencing such coverage. Tenant agrees to indemnify Landlord
and hold Landlord harmless against any loss, liability (including, without limitation, reasonable attorneys’
fees and expenses) or damage resulting from such work, and Tenant must, if requested by Landlord, furnish
a bond or other security satisfactory to Landlord against any such loss, liability or damage.
11.3 Tenant shall not suffer or cause the filing of any mechanic’s or other lien against the
Demised Premises or the Project. If a mechanic’s or materialmen’s lien is threatened by any contractor or
supplier, or in the event of the filing of a notice of any such lien, then Tenant shall: (i) either: (A) cause
such lien to be discharged of record within ten (10) days after notice from Landlord or the date of such
filing, as the case may be; or (B) provide evidence that the lien is being contested by proceedings adequate
to prevent foreclosure of the lien, together with satisfactory indemnity (in an amount equal t o at least one
hundred fifty percent (150%) of the claimed lien) to Landlord within thirty (30) days after notice of the
filing thereof; and (ii) reimburse Landlord for any costs Landlord incurs due to the filing of such lien,
including, but not limited to Landlord’s legal fees. All liens suffered or caused by Tenant shall attach to
Tenant’s interest only, and Landlord’s interest in all or any part of the Project shall not be subject to any
lien for improvements made by Tenant. Nothing in this Lease shall be deemed or construed to: (1)
constitute consent to, or request of, any party for the performance of any work for, or the furnishing of any
materials to, Tenant; or (2) give Tenant the right or authority to contract for, authorize, or permit the
performance of any work or the furnishing of any materials that would permit the attaching of a mechanic’s
lien to Landlord’s interest in the Demised Premises or Project.
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11.4 In the event Tenant uses a contractor to perform construction work within the Demised
Premises, Tenant must, prior to the commencement of such work, obtain Landlord’s approval of such
contractor and require such contractor to execute and deliver to Landlord a waiver and release on the form
attached hereto as Exhibit “E” of any and all claims against Landlord and liens against the Project to which
such contractor might at any time be entitled and to execute and record a Bond to Pay Claims (the “Bond”)
in accordance with Chapter 53, Subchapter I of the Texas Property Code, as such may be amended,
superseded or replaced from time to time, and must deliver a copy of the recorded Bond to Landlord. The
delivery of the waiver and release of lien and the Bond within the time period set forth above is a condition
precedent to Tenant’s ability to enter on and begin its construction work at the Demised Premises and, if
applicable, to any reimbursement from Landlord for its construction work.
11.5 In the event that Landlord elects to remodel all or any portion of the Project, Tenant will
cooperate with such remodeling, including Tenant’s tolerating temporary inconveniences (and even the
temporary removal of Tenant’s signs in order to facilitate such remodeling, as it may relate to the exterior
of the Demised Premises).
ARTICLE 12
LANDLORD’S RIGHT OF ACCESS
12.1 Landlord is entitled to enter upon the Demised Premises at any time upon reasonable notice
for the purpose of inspecting the same, or of making repairs to the Demised Premises, or of making repairs,
alterations or additions to adjacent premises, or of showing the Demised Premises to prospective
purchasers, tenants or lenders.
12.2 Tenant will permit Landlord to place and maintain “For Rent” or “For Lease” signs on the
Demised Premises during the last 180 days of the lease term or during any period that an event of default
is continuing hereunder, it being understood that such signs in no way affect Tenant’s obligations pursuant
to Section 9.4, Section 13.1 or any other provision of this lease.
12.3 Except as described in Section 7.2(c) above, use of the roof above the Demised Premises
is reserved to Landlord.
ARTICLE 13
SIGNS; STORE FRONTS
13.1 Tenant acknowledges that because of the unique nature of the Project, Tenant’s signs will
be limited to listings on building directories and Tenant’s entry door. The signs must comply with
Landlord’s sign criteria, which will address such matters as (a) the size of the letters, (b) the materials used,
(c) the content of the sign, and (d) the location of the sign. Landlord’s current sign criteria is attached to
and made a part of this lease as Exhibit “F”.
13.2 Except as required under the term of Section 13.1 above, Tenant must not, without
Landlord’s prior written consent (a) make any changes to the exterior of the Demised Premises, or (b) install
any exterior lighting, decorations, paintings, awnings, canopies or the like, or (c) erect or install any signs,
window or door lettering, placards, decorations or advertising media of any type which can be viewed from
the exterior of the Demised Premises. All signs, lettering, placards, banners, portable signs, decorations
and advertising media (including the sign required by Section 13.1 above) must conform in all respects to
the sign criteria established by Landlord for the Project time to time in the exercise of its sole discretion
and must further comply with all applicable laws. All signs are subject to Landlord’s requirements as to
construction, method of attachment, size, shape, height, lighting, color and general appearance. Tenant
must keep all signs in good condition and in proper operating order at al l times. Landlord may include
Tenant’s trade name used at the Demised Premises in a published list (including Project directories) of the
tradenames of occupants of the Project, and Landlord may further use Tenant’s trade name, trademarks,
logos, and photos of Tenant’s store in marketing materials for the Project.
ARTICLE 14
UTILITIES
14.1 Landlord agrees to cause to be provided to the Project the necessary mains, conduits and
other facilities necessary to supply water, gas (if deemed appropriate by Landlord), electricity, telephone
service and sewerage service to the building in which the Demised Premises are located.
14.2 Intentionally Omitted.
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14.3 Landlord is not liable for any interruption whatsoever in utility services not furnished by
Landlord, nor for interruptions in utility services furnished by Landlord which are due to fire, accident,
strike, acts of God or other causes beyond the control of Landlord or which are necessary or useful in
connection with making any alterations, repairs or improvements.
ARTICLE 15
INSURANCE COVERAGES
15.1 Landlord must procure and maintain throughout the term of this lease a policy or policies
of insurance, at its sole cost and expense (but subject to Article 6 above), causing the Project to be insured
under Special Form or similar property insurance and commercial general liability insurance (with whatever
deductibles, endorsements, exceptions or special coverages Landlord, in its sole discretion, may consider
appropriate), to the extent necessary to comply with Landlord’s obligations pursuant to other provisions of
this lease. Landlord’s insurance may be procured and or carried through third party insurance companies,
captive insurance companies, programs of self-insurance or blanket policies of insurance or any
combination of the foregoing.
15.2 From and after the date of this Lease, Tenant will carry, at its expense, the insurance set
forth in paragraphs (a), (b), (c), (d) and (e) of this subsection.
(a) Commercial General Liability Insurance. Commercial General Liability Insurance
covering the Demised Premises and Tenant’s use thereof against claims for personal or bodily injury or
death or property damage occurring upon, in or about the Demised Premises (including contractual
indemnity and liability coverage), such insurance to provide coverages of not less than $1,000,000.00 per
occurrence and $2,000,000.00 annual aggregate and Damage to Premises Rented to You insurance in
amounts sufficient to cover the replacement costs of the Demised Premises and loss of use thereof, with a
deductible acceptable to Landlord. All insurance coverage required under this subparagraph (a) shall extend
to any liability of Tenant arising out of the indemnities provided for in this Lease. Additionally, each policy
evidencing the insurance required under this subparagraph shall expressly insure both Tenant and, as
additional named insureds, Landlord and the Property Manager, IT BEING THE INTENT THAT SUCH
POLICIES AFFORD INSURANCE COVERAGE TO LANDLORD AND THE PROPERTY MANAGER
AGAINST CLAIMS FOR PERSONAL OR BODILY INJURY OR DEATH OR PROPERTY DAMAGE
OCCURRING UPON, IN OR ABOUT THE PREMISES AS THE RESULT OF THE NEGLIGENCE OF
LANDLORD OR THE PROPERTY MANAGER, whether or not required by the other provisions of this
Lease.
(b) Fire and Extended Coverage Insurance. Property insurance on an all-risk extended
coverage basis (including coverage against fire, wind, tornado, vandalism, malicious mischief, water
damage and sprinkler leakage) covering all fixtures, equipment, and personal property including
improvements and betterments made to and located in the Demised Premises and endorsed to provide one
hundred percent (100%) replacement cost coverage. Such policy will be written in the name of Tenant.
The property insurance may, with the consent of the Landlord, provide for a reasonable deductible.
(c) Workers Compensation and Employer’s Liability Insurance. Worker’s
compensation insurance together with employer’s liability insurance in an amount at least equal to the
greater of (i) the minimum worker’s compensation and employer’s liability insurance required under Texas
law or (ii) $1,000,000.00.
(d) Umbrella or Excess Liability Coverage. Umbrella or Excess Liability coverage
with Broad as Primary endorsement in amounts not less than $5,000,000 in excess of the CGL insurance
required in (a) hereinabove.
(e) Business Interruption Insurance. Extra expense and business interruption
insurance including loss of rents for periods and with limits not less than twelve (12) months of Tenant’s
rental obligations hereunder.
Tenant’s commercial general liability policy or policies must list Landlord and any other named insured
designated by Landlord as loss payees (as to the Special Form or similar property insurance), as to
Landlord’s or such other named insured’s interest in any of Tenant’s property, and as “additional insureds”
(as to all other insurance, including, without limitation, the commercial general liability insurance), and
must be written by insurance companies and on forms and with deductibles satisfactory to Landlord, and
Tenant’s insurance shall be primary (with any policies of Landlord or Landlord’s mortgagees being excess,
secondary and non-contributory). None of Tenant’s insurance policies shall have any exclusion to coverage
for events involving an assault or battery or the use of firearms. Additionally, Tenant’s worker’s
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compensation and employer’s liability policies must include waivers of subrogation in favor of Landlord.
Tenant must obtain a written obligation on the part of each insurance company to notify Landlord at least
thirty (30) days (ten (10) days for nonpayment) prior to cancellation or modification of such insurance, or
as otherwise required by state amendatory requirement. Tenant must promptly deliver such policies or duly
executed certificates of insurance to Landlord before Tenant occupies any portion of the Demised Premises
and must promptly deliver renewals thereof as required to Landlord at least thirty days prior to the
expiration of the respective policy terms. If Tenant should fail to comply with the foregoing requirements
relating to insurance, Landlord may obtain such insurance and Tenant must pay to Landlord on demand as
additional rental hereunder the premium cost thereof plus interest at the maximum contractual rate (but in
no event to exceed 1½% per month) from the date of payment by Landlord until repaid by Tenant.
ARTICLE 16
INDEMNIFICATION; WAIVER OF LIABILITY; MUTUAL WAIVER OF SUBROGATION
16.1 Landlord and Landlord’s agents and employees are not liable to Tenant, nor to Tenant’s
employees, agents or visitors, nor to any other person whomsoever, for any loss or damage that may be
occasioned by or through the acts or omissions of other tenants of the Project or of any other persons
whomsoever. Landlord cannot be held responsible in any way on account of any construction, repair or
reconstruction (including widening) of any private or public roadways, walkways or utility lines.
16.2 Intentionally Omitted
16.3 EXCEPT AS MAY BE OTHERWISE EXPRESSLY PROVIDED HEREIN TO THE
CONTRARY, LANDLORD SHALL INDEMNIFY, DEFEND AND HOLD TENANT AND ITS
AFFILIATED ENTITIES, AND THEIR AGENTS, EMPLOYEES, OFFICERS, DIRECTORS,
SHAREHOLDERS, PARTNERS AND PRINCIPALS HARMLESS FROM AND AGAINST ANY AND
ALL LOSS, COST, LIABILITY, CLAIM, DAMAGE AND EXPENSE FOR ANY INJURY TO PERSON
OR DAMAGE TO PROPERTY (INCLUDING, WITHOUT LIMITATION, REASONABLE
ATTORNEYS’ FEES) (COLLECTIVELY, THE “COMMON AREA LIABILITIES”) OCCURRING IN
THE COMMON AREAS OF THE PROJECT, EVEN IF THE COMMON AREA LIABILITIES ARE
CAUSED IN PART BY TENANT’S NEGLIGENCE. LANDLORD’S INDEMNIFICATION DOES NOT
APPLY, HOWEVER, TO ANY COMMON AREA LIABILITIES CAUSED BY TENANT’S WILLFUL
ACT OR OMISSION.
16.4 Intentionally Omitted
ARTICLE 17
DAMAGES BY CASUALTY
17.1 Tenant must give immediate written notice to the Landlord of any damage caused to the
Demised Premises by fire or other casualty.
17.2 In the event that the Demised Premises are damaged or destroyed by fire or other casualty
insurable under standard Special Form or similar property insurance and Landlord does not elect to
terminate this lease as hereinafter provided, Landlord must proceed with reasonable diligence and at its sole
cost and expense to rebuild and repair the Demised Premises. In the event (a) the building in which the
Demised Premises are located is destroyed or substantially damaged by a casualty not covered by
Landlord’s insurance, or (b) such building is destroyed or rendered untenantable to an extent in excess of
fifty percent of the first floor area by a casualty covered by landlord’s insurance, or (c) the holder of a
mortgage, deed of trust or other lien on such building at the time of the casualty elects, pursuant to such
mortgage, deed of trust or other lien, to require the use of all or part of Landlord’s insurance proceeds in
satisfaction of all or part of the indebtedness secured by the mortgage, deed of trust or other lien, then
Landlord may elect either to terminate this lease or to proceed to rebuild and repair the Demised Premises.
Landlord must give written notice to Tenant of such election within sixty days after the occurrence of such
casualty and, if it elects to rebuild and repair, must proceed to do so with reasonable diligence and at its
sole cost and expense.
17.3 Landlord’s obligation to rebuild and repair under this Article 17 is in any event limited to
restoring one of the following (as may be applicable): (a) if this lease does not include an attached exhibit
describing Landlord’s initial construction responsibility (defined in such exhibit as “Landlord’s Work”),
restoring the Demised Premises to substantially the condition in which the same existed immediately prior
to such casualty, exclusive of any alterations, additions, improvements, fixtures and equipment installed by
Tenant; or (b) rebuilding concrete floors, walls made of metal studs and drywall, a roof (but no ceiling),
and Landlord’s Work, as described in an exhibit attached to this lease, to substantially the same condition
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in which the same existed immediately prior to the casualty. Tenant agrees that promptly after completion
of such work by Landlord, Tenant will proceed with reasonable diligence and at Tenant’s sole cost and
expense to restore, repair and replace all alterations, additions, improvements, fixtures, signs and equipment
installed by Tenant, or, if an exhibit describing Tenant’s Work is attached hereto, all items of Tenant’s
Work as described in such exhibit, as the case may be, and to re-commence business operations at the
Demised Premises as soon as reasonably possible.
17.4 Tenant agrees that during any period of reconstruction or repair of the Demised Premises,
it will continue the operation of its business within the Demised Premises to the extent practicable. During
the period from the occurrence of the casualty until Landlord’s repairs are completed, the minimum
guaranteed rental will be reduced to such extent as may be fair and reasonable under the circumstances;
however, there will be no abatement of the other charges provided for herein.
ARTICLE 18
EMINENT DOMAIN
18.1 In the event (a) thirty percent (30%) or more of the floor area of the Demised Premises or
(b) fifty percent (50%) or more of the building in which the Demised Premises are located (whether or not
the Demised Premises are affected) should be taken for any public or quasi-public use under any
governmental law, ordinance or regulation or by right of eminent domain or by private purchase in lieu
thereof, then Landlord may terminate this lease. Landlord must give written notice to Tenant of such
termination within sixty (60) days after the occurrence of such taking. If this lease is so terminated, the
rent will be abated during the unexpired portion of this lease, effective on the date physical possession is
taken by the condemning authority.
18.2 If less than (a) thirty percent (30%) of the floor area of the Demised Premises or (b) less
than fifty percent (50%) of the building in which the Demised Premises are located (whether or not the
Demised Premises are affected) should be taken as aforesaid; or if this lease is not terminated pursuant to
Section 18.1 above following a taking, then this lease will continue in effect following such taking,
however, the minimum guaranteed rental payable hereunder during the unexpired portion of this lease will
be reduced in proportion to the area taken, effective on the date physical possession is taken by the
condemning authority. In such case, Landlord must make all necessary repairs or alterations to the
remaining Demised Premises or, if an exhibit describing Landlord’s Work is attached to this lease, all
necessary repairs within the scope of Landlord’s Work as described in such exhibit, as the case may be,
required to make the remaining portions of the Demised Premises an architectural whole.
18.3 If any part of the Common Area should be taken as aforesaid, this lease will not terminate,
nor will the rent payable hereunder be reduced, except that either Landlord or Tenant may terminate this
lease if the size of the parking area remaining following such taking plus any additional parking area
provided by Landlord in reasonable proximity to the Project is less than seventy percent of the size of the
parking area immediately prior to the taking. Any election to terminate this lease in accordance w ith this
provision must be evidenced by written notice of termination delivered to the other party within thirty days
after the date physical possession is taken by condemning authority.
18.4 All compensation awarded for any taking (or the proceeds of private sale in lieu thereof)
of the Demised Premises or Common Area is the property of Landlord, and Tenant hereby assigns its
interest in any such award to Landlord; provided, however, Landlord has no interest in any award made to
Tenant for Tenant’s moving and relocation expenses or for the loss of Tenant’s fixtures and other tangible
personal property if a separate award for such items is made to Tenant as long as such separate award does
not reduce the amount of the award that would otherwise be awarded to Landlord.
ARTICLE 19
ASSIGNMENT AND SUBLETTING
19.1 Tenant is not permitted to assign or in any manner transfer this lease or any estate or interest
therein, or sublet the Demised Premises or any part thereof, or grant any license, concession or other right
of occupancy of any portion of the Demised Premises without the prior written consent of Landlord.
Landlord agrees that it will not withhold consent in a wholly unreasonable and arbitrary manner (as further
explained in Section 28.4 of this lease); however, in determining whether or not to grant its consent,
Landlord is entitled to take into consideration factors such as (a) Landlord’s desired tenant mix; (b) the
experience, reputation and financial condition of the proposed transferee; (c) whether Landlord is already
in negotiation with such proposed transferee; (d) whether such proposed transferee is already an occupant
of the Project; (e) whether such proposed transferee is a governmental agency; (f) whether such proposed
transferee is incompatible with the character of occupancy of the Project; (g ) whether such proposed
transferee would subject the Demised Premises to a use which would: (i) involve increased personnel or
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wear upon the Project, (ii) conflict with the primary use of another tenant or violate any exclusive right
granted to another tenant of the Project, (iii) require any addition to or modification of the Demised Premises
or the Project in order to comply with building code or other governmental requirements, or (iv) involve a
potential environmental risk or issue; and (h) and the then current market conditions (including market
rentals). Tenant shall pay to Landlord a non-refundable processing fee (the “Processing Fee”) for each
requested assignment or sublease to cover Landlord’s administrative costs, whether or not Landlord
consents to the proposed assignment or subletting. The Processing Fee shall accompany any request for
Landlord’s consent to an assignment or sublease, and Landlord shall have no obligation to process or
consider Tenant’s request until Tenant pays such Processing Fee to Landlord. The Processing Fee shall be
$10,000.00 for any such request made during the first eighteen (18) months of the Term and for the second
such request made during any consecutive eighteen (18)-month period. The Processing Fee for any other
such request shall be $2,000.00 subject to a cumulative 100% increase (i.e., $4,000.00, $8,000.00, etc.) for
each additional request thereafter. Consent by Landlord to one or more assignments or sublettings does not
operate as a waiver of Landlord’s rights as to any subsequent assignment and sublettings.
19.2 If Tenant is a corporation, partnership or other entity and if at any time during the term of
this lease the person or persons who own a majority of either the outstanding voting rights or the outstanding
ownership interests of Tenant at the time of the execution of this lease cease to own a majority of such
voting rights or ownership interests or otherwise lose control (except as a result of transfers by devise or
descent), then such loss or transfer of a majority of such voting rights or ownership interests or control is
deemed to be an assignment of this lease by Tenant and, therefore, subject in all respects to the provisions
of Section 19.1 above. The previous sentence does not apply, however, if at the time of the execution of
this lease, Tenant is a corporation and the outstanding voting shares of capital stock of Tenant are listed on
a recognized security exchange or over-the-counter market.
19.3 Any assignee or sublessee of an interest in and to this lease will be deemed, by acceptance
of such assignment or sublease or by taking actual or constructive possession of the Demised Premises, to
have assumed all of the obligations set forth in or arising under this lease. Such assumption will be effective
as of the earlier of the date of such assignment or sublease or the date on which the assignee or sublessee
obtains possession of the Demised Premises. If requested by Landlord, however, such assignee or sublessee
shall additionally execute a commercially reasonable form of assumption agreement.
19.4 Notwithstanding any assignment or subletting, Tenant and any guarantor of Tenant’s
obligations under this lease will at all times remain fully responsible and liable for the payment of the rent
herein specified and for compliance with all of its other obligations under this lease (even if future
assignments and sublettings occur subsequent to the assignment or subletting by Tenant, and regardless of
whether or not Landlord’s approval has been obtained for such future assignments and sublettings).
Moreover, in the event that the rental due and payable by a sublessee (or a combination of the rental payable
under such sublease plus any bonus or other consideration therefor or incident thereto) exceeds the rental
payable under this lease, or if with respect to a permitted assignment, permitted license or other transfer by
Tenant permitted by Landlord, the consideration payable to Tenant by the assignee, licensee or other
transferee exceeds the rental payable under this lease, then Tenant is bound and obligated to pay Landlord
all such excess rental and other excess consideration within ten (10) days following receipt thereof by
Tenant from such sublessee, assignee, licensee or other transferee, as the case may be. Finally, in the event
of an assignment or subletting, it is understood and agreed that Tenant will receive all rentals paid to Tenant
by an assignee or sublessee in trust for Landlord, to be forwarded immediately to Landlord without offset
or reduction of any kind; and upon election by Landlord suc h assignee or sublessee must pay all rentals
directly to Landlord as specified in Section 4.2 of this lease (to be applied as a credit and offset to Tenant’s
rental obligation).
19.5 Tenant is not permitted to mortgage, pledge or otherwise encumber its interest in this lease
or in the Demised Premises.
19.6 Within twenty (20) days after Landlord receives Tenant’s written request for Landlord’s
consent to a proposed assignment or sublease, Landlord shall have the right, by notice to Tenant, to
recapture the portion of the Demised Premises that Tenant is proposing to sublet (or recapture the entire
Demised Premises in the event of a proposed assignment of this Lease or a proposed subletting of the entire
Demised Premises). If Landlord exercises its right to recapture, this Lease shall automatically be amended
(or terminated if the entire Demised Premises is being assigned or sublet) to delete the applicable portion
of the Demised Premises effective on the proposed effective date of the proposed assignment or subletting,
although Landlord may require Tenant to execute an amendment or other document reflecting such
reduction or termination. If the size of the Demised Premises is reduced, the amount of minimum
guaranteed rental due under this Lease and Tenant’s Proportionate Share shall be reduced proportionately
based on the percentage reduction of the Premises.
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19.7 In the event of the transfer and assignment by Landlord of its interest in this lease and in
the building containing the Demised Premises to a person expressly assuming Landlord’s obligations under
this lease, Landlord will thereby be released from any further obligations hereunder, and Tenant agrees to
look solely to such a successor-in-interest of the Landlord for performance of such obligations. Any
security given by Tenant to secure performance of Tenant’s obligations hereunder may be assigned and
transferred by Landlord to such successor-in-interest and Landlord will thereby be discharged of any further
obligation relating thereto.
ARTICLE 20
SUBORDINATION; ATTORNMENT; ESTOPPELS
20.1 Tenant accepts this lease subject and subordinate to any mortgage, deed of trust or other
lien presently existing or hereafter placed upon the Project or any portion of the Project which includes the
Demised Premises, and to any renewals and extensions thereof. Tenant further agrees to attorn to any
mortgagee, ground lessor, trustee under a deed of trust, or purchaser at a foreclosure sale or trustee’s sale
as landlord under this lease (as the case may be, “Mortgagee”); provided, however, as part of such
attornment, Tenant agrees for the benefit of any Mortgagee that if such Mortgagee succeeds to Landlord’s
(or any successor’s) interest in this lease, such Mortgagee will have no liability for any act or omission of
any prior landlord under this lease that occurs prior to the date such Mortgagee succeeds to Landlord’s (or
any successor’s) interest in this lease nor any liability for claims, offsets, or defenses that Tenant might
have had against Landlord (or any successor) nor have any liability for any warranties or indemnities in this
lease. Tenant agrees that any Mortgagee has the right at any time to subordinate its mortgage, deed of trust
or other lien to this lease; provided, however, whether or not that this lease may be (or be made to be)
superior to a mortgage, deed of trust or other lien, the Mortgagee will not be liable for prepaid rentals,
security deposits and claims accruing during Landlord’s ownership; further provided that the provisions of
a mortgage, deed of trust or other lien relative to the rights of the Mortgagee with respect to proceeds arising
from an eminent domain taking (including a voluntary conveyance by Landlord) and provisions relative to
proceeds arising from insurance payable by reason of damage to or destruction of the De mised Premises
will be prior and superior to any contrary provisions contained in this instrument with respect to the payment
or usage thereof. Landlord is hereby irrevocably vested with full power and authority to subordinate this
lease to any mortgage, deed of trust or other lien hereafter placed upon the Demised Premises or the Project
as a whole, and Tenant agrees upon demand to execute such further instruments subordinating this lease
(or evidencing the subordination of this lease pursuant to the terms hereof) as Landlord may request;
provided, however, that upon Tenant’s written request and notice to Landlord, Landlord must use good
faith efforts to obtain from any such Mortgagee a written agreement that after a foreclosure (or a deed in
lieu of foreclosure) the rights of Tenant will remain in full force and effect during the term of this lease,
except as otherwise provided in this Section 20.1 and as may be required by Mortgagee, so long as Tenant
recognizes and performs all of the covenants and conditions of this lease. Tenant agrees to execute a non-
disturbance, attornment and subordination agreement on Mortgagee’s then current form or such other form
as Tenant and Mortgagee may agree to execute (the “SNDA”), if requested by Landlord, and Tenant further
agrees that the SNDA constitutes a written agreement meeting the requirements of the agreement which
Tenant may request that Landlord obtain, as described above.
20.2 At any time when the holder of an outstanding mortgage, deed of trust or other lien
covering Landlord’s interest in the Demised Premises has given Tenant written notice of its interest in this
lease (or if Tenant otherwise receives written notice from Landlord of such holder’s interest in this lease),
Tenant (i) may not exercise any remedies for default by Landlord hereunder unless and until the holder of
the indebtedness secured by such mortgage, deed of trust or other lien has received written notice of such
default and a reasonable time (not less than 30 days) has thereafter elapsed without the default having been
cured, (ii) shall not prepay any rent or other amounts due under this lease more than thirty (30) days in
advance except as expressly permitted by this lease, and (iii) shall not -- without such Mortgagee’s prior
consent -- enter into any surrender or cancellation of this lease or any modification or amendment that
decreases the lease term or decreases the amount of minimum guaranteed rental or other charges due under
this lease.
20.3 Tenant agrees that it will from time to time upon request by Landlord execute and deliver
to Landlord a written statement addressed to Landlord (or to a party or parties designated by Landlord),
which statement must identify Tenant and this lease, must certify that this lease is unmodified and in full
force and effect (or if there have been modifications, that the same is in full force and effect as so modified),
must confirm that Landlord is not in default as to any obligations of Landlord under this lease (or if Landlord
is in default, specifying any default), must confirm Tenant’s agreements contained above in this Article 20,
and must contain such other information or confirmations as Landlord may reasonably require. Tenant
acknowledges that the form of estoppel certificate attached to this lease as Exhibit “G” is an example of the
type of written statement described in this Section 20.3, and Tenant agrees to execute and deliver to
Landlord such form of written statement (with the appropriate blanks completed) as required from time to
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time by this Section 20.3. Landlord is hereby irrevocably appointed and authorized as the agent and
attorney-in-fact of Tenant to execute and deliver any such written statement on Tenant’s behalf if Tenant
fails to do so within seven (7) days after the delivery of a written request from Landlord to Tenant.
ARTICLE 21
PARKING
21.1 Landlord and Tenant acknowledge the importance of providing Project customers with
sufficient ground level parking space reasonably close to the stores and offices they wish to visit.
Accordingly, Tenant and Tenant’s employees may park only in the areas designated by Landlord, from time
to time, as employee parking in the Project. Without limiting the terms of the foregoing sentence, Tenant
acknowledges and agrees that neither Tenant nor its employees will use any on -street parking for the
Project, it being understood and agreed that such parking is for the office and retail customers of the Project.
With respect to any elevated parking garages located on the Project or adjacent land (collectively, the
“Parking Garages”), Tenant agrees that Tenant shall (i) restrict its employees from parking in parking
spaces located on the first (1st) and second (2nd) floors of the Parking Garages and (ii) comply with the
City of Southlake’s rules and regulations governing the Parking Garages, as amended from time t o time.
Tenant must furnish Landlord with a complete list of license numbers of all automobiles operated by
Tenant, its employees, its subtenants, its licensees and its concessionaires, and their employees; Tenant
must furnish such list to Landlord within five (5) days after the Delivery Date of this lease, and Tenant must
notify Landlord of any changes to such list within five (5) days after such changes occur. Tenant agrees
that if any automobile or other vehicle owned by Tenant or any of its employees, its subtenants, its licensees
or its concessionaires, or their employees, at any time are parked in any part of the Project other than the
parking areas specified above as being permitted parking areas for Tenant and its employees, Tenant must
pay to Landlord as additional rent upon demand an amount equal to the daily rate or charge for such parking
as established by Landlord (currently, $10.00 for the first violation and $50.00 for each violation thereafter)
from time to time for each day, or part thereof, that such automobile or other vehicle is so parked. In
addition, Tenant must immediately remove the vehicle to parking areas specified above as being permitted
parking areas for Tenant and its employees. If Tenant fails to respond immediately, Landlord has the right
to take either such action; and Tenant hereby indemnifies Landlord and agrees to hold Landlord harmless
from all removal and parking expenses and liabilities which may arise out of Landlord’s action. In addition
to the rights granted by the preceding sentences, any violation of this Section, whether by Tenant or by one
of Tenant’s employees, entitles Landlord to exercise at its option any one or more of the remedies which
are authorized in Article 22 of this Lease.
21.2 Tenant acknowledges that Landlord may, at some time in the future, construct an additional
parking structure (whether under-or above-ground) for the Project. In the event Landlord constructs a
parking structure, Tenant will cooperate with such construction efforts, including tolerating inconveniences
during the construction process.
ARTICLE 22
DEFAULT BY TENANT AND REMEDIES
22.1 The following events will be deemed to be events of default by Tenant under this lease:
(a) Tenant fails to pay any installment of rental or any other obligation under this lease
involving the payment of money and such failure continues for a period of ten (10) days after
written notice thereof to Tenant; provided, however, that for each cale ndar year during which
Landlord has already given Tenant one written notice of the failure to pay an installment of rental
or other obligation under this lease involving the payment of money, no further notice will be
required (i.e., the event of default will automatically occur on the tenth day after the date upon
which the rental was due).
(b) Tenant fails to comply with any provision of this lease, other than as described in
Subsection (a) above, and following notice thereof to Tenant (i) does not promptly commence and
diligently pursue the cure of such failure to completion, or (ii) fails to cure such failure within
fifteen (15) days after such notice to Tenant, or (iii) cures that particular failure but again fails to
comply with the same provision of this lease within three (3) months after such notice to Tenant,
or (iv) cures that particular failure but again fails to comply with the same provision of this lease
in excess of three times during the Term.
(c) Tenant or any guarantor of Tenant’s obligations under this lease becomes
insolvent, or makes a transfer in fraud of creditors, or makes an assignment for the benefit of
creditors.
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(d) Tenant or any guarantor of Tenant’s obligations under this lease files a petition
under any section or chapter of the federal Bankruptcy Code, as amended, or under any similar law
or statute of the United States or any state thereof; or Tenant or any guarantor of Tenant’s
obligations under this lease is adjudged bankrupt or insolvent in proceedings filed against Tenant
or any guarantor of Tenant’s obligations under this lease thereunder.
(e) A receiver or Trustee is appointed for the Demised Premises or for all or
substantially all of the assets of Tenant or any guarantor of Tenant’s obligation under this lease.
(f) Tenant deserts or vacates or commences to desert or vacate the Demised Premises
or any substantial portion of the Demised Premises or at any time prior to the last month of the
lease term removes or attempts to remove, without the prior written consent of Landlord, all or a
substantial amount of Tenant’s goods, wares, equipment, fixtures, furniture, or other personal
property.
(g) Tenant does or permits to be done anything which creates a lien upon the Demised
Premises or upon all or any part of the Project.
(h) Intentionally Omitted.
(i) In the event Tenant or any Guarantor is a business organization, such business
organization fails to remain in good standing in its state of organization and the state in which the
Project is located or such business organization is dissolved.
22.2 Upon the occurrence of any such events of default, Landlord has the option to pursue any
one or more of the following remedies:
(a) Without any further notice or demand whatsoever, Landlord may enter upon and
take possession of the Demised Premises and expel or remove Tenant and any other person who
may be occupying the Demised Premises or any part of the Demised Premises, by force , if
necessary (except to the extent prohibited by Texas law), without being liable for prosecution or
any claim for damages for such action. Such expulsion and removal by Landlord cannot be deemed
a termination or forfeiture of this lease or acceptance of Tenant’s surrender of the Demised
Premises unless Landlord expressly notifies Tenant in writing that Landlord is terminating or
forfeiting this lease or accepting Tenant’s surrender of the Demised Premises. If Landlord expels
or removes Tenant and any other person from the Demised Premises without terminating or
forfeiting this lease or accepting surrender of the Demised Premises, Landlord must attempt to
mitigate its damages. In any situation in which Landlord is attempting to mitigate its damages,
Landlord will conclusively be deemed to have done so if Landlord lists the Demised Premises with
a real estate broker or agent (which may be affiliated with Landlord) and considers all written
proposals for such space made by such broker or agent; provided, h owever, that in no event will
Landlord (i) be obligated to travel outside a radius of thirty (30) miles from its principal office in
order to meet with a prospective tenant, (ii) be obligated to expend monies for finish-out requested
by a prospective tenant unless Landlord, in its sole discretion, believes that the excess rent Landlord
will receive and the credit of the prospective tenant support such a decision, (iii) be required to give
preference to the Demised Premises over other spaces in the Project, (iv) be required to agree to
allow an existing tenant of the Project to move from their existing space to all or any of the Demised
Premises, or (v) be required to accept any lease proposal which Landlord, in its sole discretion,
deems unacceptable. In attempting to relet or actually reletting the Demised Premises, Landlord
will be free to enter into a direct lease with the proposed replacement tenant and will not be acting
as Tenant’s agent, although the proceeds Landlord actually receives for any time period will be
credited against Tenant’s obligations for the same time period. Tenant will not be entitled to any
additional credit (for example, if Landlord receives amounts during a particular time period in
excess of Tenant’s obligations for the same time period, Landlord will not be required to credit
such excess against Tenant’s obligations for any other time period). Until Landlord is able, through
such efforts, to relet the Demised Premises, Tenant must pay to Landlord, on or before the first day
of each calendar month, in advance, the monthly rentals and other charges provided in this lease.
At such time, if any, as Landlord relets the Demised Premises, Tenant must pay to Landlord on the
20th day of each calendar month the difference between the monthly rentals and other charges
provided in this lease for such calendar month and the amount actually collected by Landlord for
such month from the occupant to whom Landlord has re-let the Demised Premises. If it is necessary
for Landlord to bring suit in order to collect any deficiency, Landlord has the right to allow such
deficiencies to accumulate and to bring an action on several or all of the accrued deficiencies at one
time. Any such suit cannot prejudice in any way the right of Landlord to bring a similar action for
any subsequent deficiency or deficiencies.
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(b) Without any further notice or demand whatsoever, Landlord may terminate this
lease by written notice to Tenant, in which event Tenant must immediately surrender the Demised
Premises to Landlord, and if Tenant fails to do so, Landlord may, without preju dice to any other
remedy which Landlord may have for possession or arrearages in rent (including any late charge
or interest which may have accrued pursuant to Section 4.3 of this lease), enter upon and take
possession of the Demised Premises and expel or remove Tenant and any other person who may
be occupying the Demised Premises or any part thereof, by force, if necessary (except to the extent
prohibited by Texas law), without being liable for prosecution or any claim for damages therefor.
In such event and to the fullest extent permitted by applicable law, Tenant hereby agrees to pay the
difference between the total of all monthly rentals and other charges provided in this lease for the
remainder of the term and the reasonable rental value of the Demised Premises for such period,
such difference to be discounted to present value at a rate equal to the rate of interest which is
allowed by law in the State of Texas 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 six percent per annum).
(c) Without any further notice or demand whatsoever, Landlord may pursue the
following remedies for the following specific defaults:
(i) In the event of any default described in Subsection 22.1(b) of this lease,
Landlord has the right to enter upon the Demised Premises, by force, if necessary (except
to the extent prohibited by Texas law), without being liable for prosecution or any claim
for damages therefor, and do whatever Tenant is obligated to do under the terms of this
lease; and Tenant agrees to reimburse Landlord on demand for any expenses which
Landlord may incur in thus effecting compliance with Tenant’s obligations under this lease,
and Tenant further agrees that Landlord cannot be liable for any damages resulting to the
Tenant from such action.
(ii) In the event of any default described in Subsection 22.1(g) of this lease,
Landlord may pay or bond around such lien, whether or not contested by Tenant; and in
such event Tenant agrees to reimburse Landlord on demand for all costs and expenses
incurred in connection with any such action, with Tenant further agreeing that Landlord is
in no event liable for any damages or claims resulting from such action.
(d) Notwithstanding anything to the contrary set forth in this Lease, if more than one
(1) monetary default by Tenant of any kind or amount occurs during any twelve (12) consecutive
month period, the same shall constitute, at Landlord’s option, an incurable default for all intents
and purposes under this Lease, and Landlord shall thereafter have the right, in addition to all of the
remedies set forth above, to any of the following express remedies therefor, upon written notice to
Tenant of its election: (a) increase all rental due for the remainder of the Term by an amount equal
to 10% of the rate otherwise payable; (b) require Tenant to make all remaining payments due under
the Lease by certified funds; or (c) terminate the Lease.
If Landlord elects to exercise the remedy prescribed in Subsection 22.2(a) or 22.2(c) above, this
election in no way prejudices Landlord’s right at any time thereafter to cancel such election in favor of the
remedy prescribed in Subsection 22.2(b) above, provided that at the time of such cancellation Tenant is still
in default. Pursuit of any of the above remedies does not preclude pursuit of any other remedies prescribed
in other sections of this lease and any other remedies provided by law or in equity. Forbearance by Landlord
to enforce one or more of the remedies herein provided upon an event of default cannot be deemed or
construed to constitute a waiver of such default. No agreement to accept a surrender of the Demised
Premises and no act or omission by Landlord or Landlord’s agent during the term of this lease will constitute
an acceptance of surrender of the Demised Premises unless made in writing and signed by Landlord.
Similarly, no reentry or taking of possession of the Demised Premises by Landlord will constitute an
election by Landlord to terminate this lease unless a written notice of such intention, signed by Landlord,
is given to Tenant.
22.3 It is expressly agreed that in determining “the monthly rentals and other charges provided
in this lease,” as that term is used throughout Subsections 22.2(b) and 22.2(c)(ii) above, there will be added
to the minimum guaranteed rental (as specified in Sections 1.1(n) of this lease) a sum equal to the charges
for maintenance of the Common Area (as specified in Section 7.4 of this lease), the payments for taxes,
charges and insurance (as specified in Article 6 of this lease). It is further understood and agreed that the
phrase “without any further notice or demand whatsoever” incorporates Tenant’s full, final, and complete
waiver of all demands and notices permitted or required by applicable law, whether statutory or common
law, and in equity (including, without limitation, any statutory requirement of prior written notice for filing
eviction or damage suits for nonpayment of rent), it being understood and agreed that if any notice is
appropriate, it is provided for in Section 22.1.
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22.4 Intentionally Omitted.
22.5 Landlord may restrain or enjoin any breach or threatened breach of any covenant, duty or
obligation of Tenant herein contained without the necessity of proving the inadequacy of any legal remedy
or irreparable harm. The remedies of Landlord hereunder are deemed cumulative and not exclusive of each
other.
22.6 If on account of any breach or default by Tenant in its obligations hereunder, Landlord
employs an attorney to enforce or defend any of Landlord’s rights or remedies hereunder and Landlord
prevails in any court action related to such enforcement or defense , Tenant agrees to pay any reasonable
attorney’s fees and court costs incurred by Landlord in such connection.
22.7 In the event that Tenant fails to vacate and surrender the Premises upon the expiration of
the Term without the advance written consent of Landlord, then Landlord is entitled and is hereby
authorized, without any notice to Tenant, to enter upon the Demised Premises by use of a duplicate key, a
master key, a locksmith’s entry procedures or any other means not involving personal confrontation, and
to alter or change the door locks on all entry doors of the Demised Premises, thereby permanently excluding
Tenant.
22.8 Tenant acknowledges its obligation to deposit with Landlord the sum stated in Section
1.1(p) above, to be held by Landlord without interest as security for the performance by Tenant of Tenant’s
covenants and obligations under this lease. Tenant agrees that such deposit may be co -mingled with
Landlord’s other funds and is not 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, Landlord may, from time to
time, without prejudice to any other remedy provided herein or provided by law, use such fund to the extent
necessary to make good any arrears of rentals and any other damage, injury, expense or liability caused to
Landlord by such event of default, and Tenant must pay to Landlord on demand the amount so applied in
order to restore the security deposit to its original amount. If Tenant is not then in default hereunder, any
remaining balance of such deposit will be returned by Landlord to Tenant upon termination of this lease
(subject to the provisions of Section 19.6 above).
22.9 In the event of any default described in Subsection (d) of Section 22.1 of this lease, any
assumption and assignment must conform with the requirements of the Bankruptcy Code which provides,
in part, that the Landlord must be provided with adequate assurance (i) of the source of rent and other
consideration due under this lease; (ii) that the financial condition and operating performance of any
proposed assignee and its guarantors, if any, is similar to the financial condition and operating performance
of Tenant and its guarantors, if any, as of the date of execution of this lease; (iii) that any assumption or
assignment is subject to all of the provisions of this lease (including, but not limited to, restrictions as to
use) and will not breach any such provision contained in any other lease, financing agreement or other
agreement relating to the Project; and (iv) that any assumption or assignment will not disrupt any tenant
mix or balance in the Project.
(a) In order to provide Landlord with the assurance contemplated by the Bankruptcy
Code, Tenant must fulfill the following obligations, in addition to any other reasonable obligations
that Landlord may require, before any assumption of this lease is effective: (i) all defaults under
Subsection (a) of Section 22.1 of this lease must be cured within ten (10) days after the date of
assumption; (ii) all other defaults under Section 22.1 of this lease other than under Subsection (d)
of Section 22.1 must be cured within fifteen (15) days after the date of assumption; (iii) all actual
monetary losses incurred by Landlord (including, but not limited to, reasonable attorneys fees) must
be paid to Landlord within ten (10) days after the date of assumption; and (iv) Landlord must
receive within ten (10) days after the date of assumption a security deposit in the amount of six (6)
months minimum guaranteed rental (using the minimum guaranteed rental rate in effect for the first
full month immediately following the assumption) and an advance prepayment of minimum
guaranteed rental in the amount of three (3) months minimum guaranteed rental (using the
minimum guaranteed rental in effect for the first full month immediately following the assumption),
both sums to be held by Landlord in accordance with Section 22.8 above and deemed to be rent
under this lease for the purposes of the Bankruptcy Code as amended and from time to time in
effect.
(b) In the event this lease is assumed in accordance with the requirements of the
Bankruptcy Code and this lease, and is subsequently assigned, then, in addition to any other
reasonable obligations that Landlord may require and in order to provide Landlord with the
assurances contemplated by the Bankruptcy Code, Landlord must be provided with (i) a financial
statement of the proposed assignee prepared in accordance with generally accepted accounting
principles consistently applied, though on a cash basis, which reveals a net worth in an amount
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sufficient, in Landlord’s reasonable judgment, to assure the future performance by the proposed
assignee of Tenant’s obligations under this lease; or (ii) a written guaranty by one or more
guarantors with financial ability sufficient to assure the future performance of Tenant’s obligations
under this lease, such guaranty to be in form and content satisfactory to Landlord and to cover the
performance of all of Tenant’s obligations under this lease.
22.10 In addition to any and all other remedies available to Landlord herein, Landlord shall at
any and/or all times have a right of offset against any sums of money due from Landlord to Tenant for the
payment of any and all rentals and other sums of money becoming due hereunder from Tenant, and for the
payment of any and all damages or loss which Landlord may suffer by reason of the breach by Tenant of
any covenant, agreement or condition contained herein.
22.11 The failure by Landlord to observe or perform any covenant, agreement, condition or
provision of this Lease shall be deemed a “Landlord Event of Default” if such failure shall continue for
thirty (30) days after receipt of written notice thereof from Tenant to Landlord, except that if such default
cannot be cured within such thirty (30) day period, this period will be extended, p rovided that Landlord
commences to cure such default within such thirty (30) day period and proceeds diligently thereafter to
seek to effect such cure. If a Landlord Event of Default occurs, Tenant will have all rights and remedies
available at law or in equity.
ARTICLE 23
Intentionally Omitted
ARTICLE 24
HOLDING OVER; SURRENDER OF PREMISES
24.1 In the event Tenant remains in possession of the Demised Premises after the expiration of
this lease and without the execution of a new lease, it will be deemed to be occupying the Demised Premises
as a tenant at sufferance at a daily rental equal to the rental herein provided plus fifty percent of such
amount, pro-rated on a daily basis, otherwise subject to all the conditions, provisions and obligations of this
lease insofar as the same are applicable to a tenancy at sufferance. In addition to the foregoing, Tenant
shall be and remain liable to Landlord for, and shall protect Landlord from and indemnify and defend
Landlord against, all losses and damages, including any claims made by any succeeding tenant resulting
from such failure of Tenant to vacate, and any consequential damages that Landlord suffers from the
holdover.
24.2 At the end of the term or the termination of Tenant’s right to possess the Demised Premises,
Tenant must (1) deliver to Landlord the Demised Premises with all improvements located thereon in good
repair and condition, reasonable wear and tear (subject however to Tenant’s maintenance obligations)
excepted, (2) deliver to Landlord all keys to the Demised Premises, and (3) remove all signage placed by
or on behalf of Tenant on the Demised Premises. All fixtures, alterations, additions, and improvements
(whether temporary or permanent) are Landlord’s property and must remain on the Demised Premises
except as provided in the next two sentences. Provided that Tenant has performed all of its obligations
hereunder, Tenant may remove all unattached trade fixtures, furniture, and personal property placed in the
Demised Premises by Tenant (but Tenant cannot remove any such item which was paid for, in whole or in
part, by Landlord). Additionally, Tenant must remove such alterations, additions, improvements, fixtures,
equipment, wiring, furniture, and other property as Landlord may request, provided such request is made
within six months after the end of the term. All items not so removed will, at the option of Landlord, be
deemed abandoned by Tenant and may be appropriated, sold, stored, destroyed, or otherwise disposed of
by Landlord without notice to Tenant and without any obligation to account for such items and Tenant must
pay for the costs incurred by Landlord in connection therewith. Any such disposition cannot be considered
a strict foreclosure or other exercise of Landlord’s rights in respect of the security interest granted under
Article 23. All work required of Tenant under this Section 24.2 must be coordinated with Landlord and be
done in a good and workmanlike manner, in accordance with all laws, and so as not to damage the Office
Building or the Project. Tenant must, at its expense, repair all damage caused by any work performed by
Tenant under this Section 24.2.
ARTICLE 25
NOTICES
25.1 Wherever any notice is required or permitted hereunder, such notice must be in writing.
Any notice or document required or permitted to be delivered hereunder will be deemed to be delivered
when actually received by the designated addressee or, if earlier and regardless of whether actually received
or not, when deposited in the United States mail, postage prepaid, certified mail, return receipt requested,
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addressed to the parties hereto at the respective addresses set out in Section 1.1 above (or at Landlord’s
option, to Tenant at the Demised Premises), or such other addresses as they have theretofore specified by
written notice.
25.2 If and when included within the term “Landlord” as used in this instrument there are more
than one person, firm or corporation, all must jointly arrange among themselves for their joint execution of
such notice specifying some individual at some specific address for the receipt of notices and payments to
the Landlord; if and when included within the term “Tenant” as used in this instrument there are more than
one person, firm or corporation, all must jointly arrange among themselves for their joint execution of such
a notice specifying some individual at some specific address for the receipt of notices and payments to
Tenant. All parties included within the terms “Landlord” and “Tenant,” respectively, are bound by notices
and payments given in accordance with the provisions of this Article to the same effect as if each had
received such notice or payment. In addition, Tenant agrees that notices to Tenant may be given by
Landlord’s attorney, property manager or other agent.
ARTICLE 26
AMERICANS WITH DISABILITIES ACT
26.1 Landlord represents that the Common Area was (or if not yet constructed, will be)
constructed in accordance with the requirements of the Americans With Disabilities Act of 1990, as
amended from time to time, and related state and municipal laws and regulations (collectively, the “ADA”)
as it existed at the time Landlord constructed the Project. However, Landlord’s sole obligation and
responsibility in the event such representation is not true is to cause the Common Area to comply with the
requirements, as such requirements have been modified or limited. If there are any changes to the ADA
which require changes to the Common Area, Landlord will , except to the extent the responsibility of Tenant
pursuant to Section 26.2 below, improve the Common Area of the Project in order to comply with the ADA.
All costs incurred by Landlord complying with the terms of the immediately preceding sentence may be
included as Common Area expenses pursuant to and in accordance with the terms of Section 7.4 of this
lease.
26.2 Tenant is responsible for compliance with the ADA in all matters regarding both the
configuration of the Demised Premises (the interior as well as all public and/or employee door entrances)
and Tenant’s improvement or alteration of or business operations at the Demised Premises.
ARTICLE 27
REGULATIONS
27.1 Landlord and Tenant acknowledge that there are in effect federal, state, county and
municipal laws, orders, rules, directives and regulations (collectively referred to hereinafter as the
“Regulations”) and that additional Regulations may hereafter be enacted or go into effect, relating to or
affecting the Demised Premises or the Project, and concerning the impact on the environment of
construction, land use, maintenance and operation of structures, toxic or otherwise hazardous substances,
and conduct of business. Subject to the express rights granted to Tenant under the terms of this lease,
Tenant will not cause, or permit to be caused, any act or practice, by negligence, omission or otherwise,
that would adversely affect the environment, or do anything or permit anything to be done that would violate
any of the Regulations. Moreover, Tenant has no claim against Landlord by reason of any changes Landlord
may make in the Project or the Demised Premises pursuant to the Regulations or any charges imposed upon
Tenant, Tenant’s customers or other invitees pursuant to same.
27.2 If, by reason of any Regulations, the payment to, or collection by, Landlord of any rental
or other charge (collectively referred to hereinafter as “Lease Payments”) payable by Tenant to Landlord
pursuant to the provisions of this lease is in excess of the amount (the “Maximum Charge”) permitted
thereof by the Regulations, then Tenant, during the period (the “Freeze Period”) when the Regulations are
in force and effect will not be required to pay, nor will Landlord be permitted to collect, any sum in excess
of the Maximum Charge. Upon the earlier of (i) the expiration of the Freeze Period, or (ii) the issuance of
a final order or judgment of a court of competent jurisdiction declaring the Regulations to be invalid or not
applicable to the provisions of this lease, Tenant, to the extent not then proscribed by law, and commencing
with the first day of the month immediately following, must pay to Landlord as additional rental, in equal
monthly installments during the balance of the term of this lease, a sum equal to the cumulative difference
between the Maximum Charges and the Lease Payments during the Freeze Period. If any provisions of this
section, or the application thereof, are to any extent declared to be invalid and unenforceable, the same will
not be deemed to affect any of the other provisions of this section or of this lease, all of which will be
deemed valid and enforceable to the fullest extent permitted by law.
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ARTICLE 28
MISCELLANEOUS
28.1 Nothing in this lease can be deemed or construed by the parties hereto, nor by any third
party, as creating the relationship of principal and agent or of partnership or of joint venture between the
parties hereto, it being understood and agreed that neither the method of computation of rent, nor any other
provision contained herein, nor any acts of the parties hereto, will be deemed to create any relationship
between the parties hereto other than the relationship of landlord and tenant.
28.2 Tenant must not for any reason withhold or reduce Tenant’s required payments of rentals
and other charges provided in this lease, it being agreed that the obligations of Landlord under this lease
are independent of Tenant’s obligations except as may be otherwise expressly provided herein. The
immediately preceding sentence cannot be deemed to deny Tenant the ability of pursuing all rights granted
it under this lease or at law; however, as contemplated in Rule 174(b) of the Texas Rules of Civil Procedure
(as such may be amended from time to time), at the direction of Landlord, Tenant’s claims in this regard
will be litigated in proceedings different from any litigation involving rental claims or other claims by
Landlord against Tenant (i.e., each party may proceed to a separate judgment without consideration,
counterclaim or offset as to the claims asserted by the other party). Tenant hereby waives and surrenders,
for itself and for all persons or entities claiming by, through, and under Tenant (includi ng creditors of all
kinds), any rights, privileges, and liens set out under Section 91.004 and 93.003 of the Texas Property Code
(as amended), and Tenant exempts Landlord from any duty or liability thereunder.
28.3 The liability of Landlord to Tenant for any default by Landlord under the terms of this lease
will be limited to the proceeds of sale on execution of the interest of Landlord in the Demised Premises;
and neither Landlord nor any of Landlord’s agents, employees, representatives, officers, directors, or
partners will be personally liable for any deficiency, except that Landlord will, subject to the provisions of
Section 19.6 hereof, remain personally liable to account to Tenant for any security deposit under this lease.
This clause cannot 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.
28.4 In all circumstances under this lease where the prior consent of one party (the “consenting
party”), whether it be Landlord or Tenant, is required before the other party (the “requesting party”) is
authorized to take any particular type of action, such party must not withhold such consent in a wholly
unreasonable and arbitrary manner; however, the requesting party agrees that its exclusive remedy if it
believes that consent has been withheld improperly (including, but not limited to, consent required f rom
Landlord pursuant to Section 9.2 or Section 19.1) is to institute litigation either for a declaratory judgment
or for a mandatory injunction requiring that such consent be given (with the requesting party hereby waiving
any claim for damages, attorneys fees or any other remedy by reason thereof unless t he consenting party
refuses to comply with a court order or judgment requiring it to grant its consent).
28.5 One or more waivers of any covenant, term or condition of this lease by either party cannot
be construed as a waiver of a subsequent breach of the same covenant, term or condition. The consent or
approval by either party to or of any act by the other party requiring such consent or approval cannot be
deemed to waive or render unnecessary consent to or approval of any subsequent similar act.
28.6 Whenever a period of time is herein prescribed for action to be taken by Landlord, Landlord
will not be liable or responsible for, and there will be excluded from the computation of any such period of
time, any delays due to strikes, riots, acts of God, shortages of labor or materials, war, governmental laws,
regulations or restrictions or any other causes of any kind whatsoever which are beyond the reasonable
control of Landlord.
28.7 If any provision of this lease is held to be invalid or unenforceable, the validity and
enforceability of the remaining provisions of this lease will not be affected thereby.
28.8 The laws of the State of Texas govern the interpretation, validity, performance and
enforcement of this lease. Venue for any action under this lease will lie exclusively in Tarrant County,
Texas.
28.9 The captions used herein are for convenience only and do not limit or amplify the
provisions hereof.
28.10 Whenever herein the singular number is used, the same includes the plural, and words of
any gender include each other gender, as the context so requires.
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28.11 The terms, provisions and covenants contained in this lease apply to, inure to the benefit
of and bind the parties hereto and their respective heirs, successors in interest and legal representatives
except as otherwise herein expressly provided.
28.12 This lease contains the entire agreement between the parties, and no rights are created in
favor of either party other than as specified or expressly contemplated in this lease. No brochure, rendering
information or correspondence will be deemed to be a part of this agreement unless specifically
incorporated herein by reference. In addition, no agreement will be effective to change, modify or terminate
this lease in whole or in part unless such is in writing and duly signed by the party against whom
enforcement of such change, modification or termination is sought.
28.13 Except for the Agent and Cooperating Agent, Tenant and Landlord represent and warrant
to each other that neither has had any contacts or engaged in any actions which would give rise to any claim
from any broker in connection with the negotiation or execution of this lease. Tenant and Landlord hereby
indemnify each other from and against any and all claims for brokers’ commissions relating to the
negotiation or execution of this lease and alleged to be due because of an agreement of the indemnifying
party. LANDLORD AND TENANT HEREBY ACKNOWLEDGE THAT THEY ARE NOT RELYING
UPON ANY BROCHURE, RENDERING, INFORMATION, REPRESENTATION OR PROMISE OF
THE OTHER, OR OF THE AGENT OR COOPERATING AGENT, EXCEPT AS MAY BE EXPRESSLY
SET FORTH IN THIS LEASE.
28.14 If prior to the final thirty-six (36) months of the lease term Landlord requires the Demised
Premises for use by another tenant or for other reasons connected with the Office Building planning
program, then Landlord has the right, upon sixty (60) days’ prior written notice to Tenant, to relocate the
Demised Premises to other space in the Office Building or Project of substantially similar size as the
Demised Premises and with tenant improvements of substantially similar age, quality, and layout as the n
existing in the Demised Premises. In the event of any such relocation, Landlord must pay for the cost of
providing such substantially similar tenant improvements (but not any furniture or personal property), and
Landlord must reimburse Tenant, within thirty (30) days after Landlord’s receipt of invoices and paid
receipts, for the reasonable moving, telephone installation and stationery reprinting costs actually paid for
by Tenant in connection with such relocation.
If within the final thirty-six (36) months of the lease term, Landlord requires the Demised Premises
for use by another tenant or for other reasons connected with the Office Building planning program, then
Landlord has the right, upon sixty (60) days’ prior written notice to Tenant, to relocate the Demised
Premises to other existing space in the Office Building or Project that will allow Tenant to continue the
operation of its business in a reasonable fashion (but such space is not required to have tenant improvements
of substantially similar age, quality, and layout). In such event, Tenant may at its option offer to extend the
term of the lease so that following such relocation, the lease term will expire sixty (60) months thereafter.
If Landlord accepts such offer to extend the lease term, Landlord shall relocate the Demised Premises to
other space in the Project of substantially similar size as the Demised Premises and with tenant
improvements of substantially similar age, quality, and layout as then existing in the Demised Premises. In
the event of any such relocation, Landlord must pay for the cost of providing the applicable level of tenant
improvements and must reimburse Tenant, within thirty (30) days after Landlord’s receipt of invoices and
paid receipts, for the reasonable moving, telephone installation, and stationery reprinting cost actually paid
for by Tenant in connection with such relocation.
If Landlord relocates Tenant pursuant to this Section 28.14, the terms and conditions of this lease
will remain in full force and effect and apply to the new space, except that (a) a revised Exhibit “A” and
Exhibit “B” will become part of this lease and will reflect the location of the new space, (b) Section 1.1(j)
of this lease will be amended to include and state all correct data as to the new space, and (c) such new
space will thereafter be deemed to be the “Demised Premises”. Notwithstanding the foregoing provisions
of this Section 28.14 to the contrary, if the new space contains more rentable square feet than the original
Demised Premises, minimum guaranteed rental or other charges will be calculated using the rentable square
feet in the original Demised Premises (or the usable square feet, as the case may be). Landlord and Tenant
agree to cooperate fully in order to minimize the inconvenience of Tenant resulting from such relocation.
In addition to the foregoing, Tenant hereby acknowledges and agrees that Landlord may, in its sole
discretion and at any time during the Lease Term, enter into an underlying lease for some or all of the Office
Building pursuant to which the tenant thereunder (the “Managing Tenant”) would manage and/or operate
such leased portion of the Office Building (a “Management Master Lease”). In such event Tenant shall, at
the request of Landlord or Landlord’s successor in interest, attorn to and recognize the Managi ng Tenant,
as Landlord under this Lease for the balance then remaining Lease Term, and thereafter this Lease shall
continue as a direct lease between such Managing Tenant, as “Landlord,” and Tenant, as “Tenant”. Tenant
shall, upon request by Landlord or the Managing Tenant, execute and deliver an instrument or instruments
confirming the foregoing provisions of this Section. Alternatively, if Landlord so enters into a Management
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Master Lease, Landlord may at its option, terminate this Lease upon not less than five (5) days written
notice to Tenant, and in such Tenant hereby agrees to enter into a new direct sublease with the Managing
Tenant for the then balance of the Lease Term, upon the same terms, covenants and conditions as therein,
so as to establish direct privity of contract between Managing Tenant and Tenant.
Landlord shall further have the right to terminate this Lease if Landlord and/or Managing Tenant
proposes or is required, for any reason, to remodel, remove, or demolish the Office Building or any portion
thereof. Such cancellation shall be exercised by Landlord by the service of not less than thirty (30) days'
written notice of such termination. Such notice shall set forth the date upon which the termination will be
effective. No money or other consideration shall be payable by Landlord to Tenant for Landlord's exercise
of the rights set forth in this Section 28.14, and the rights are hereby reserved to Landlord and all purchasers,
successors, assigns, transferees, and ground tenants of Landlord, as the case may be, and is in addition to
all other rights of Landlord. Tenant has read the foregoing and understands that Landlord has a right to
terminate this Lease as provided above.
28.15 If Tenant is a corporation or a partnership (general or limited), each person(s) signing this
lease as an officer or partner of Tenant represents to Landlord that such person(s) is authorized to execute
this lease without the necessity of obtaining any other signature of any other officer or partner, that the
execution of this lease has been authorized by the board of directors of the corporation or by the partners
of the partnership, as the case may be, and that this lease is fully binding on Tenant. Landlord reserves the
right to request evidence of the approval of this lease and authorization of Tenant’s signatories to bind
Tenant, which evidence shall be satisfactory in form and content to Landlord and Landlord’s counsel.
Tenant hereby represents to Landlord that Tenant is duly incorporated if Tenant is a corporation or duly
formed if Tenant is a partnership, and in good standing in the State of Texas, and that Tenant is not a
subsidiary of any other entity.
28.16 The submission of this lease for examination does not constitute a reservation of or option
for the Demised Premises and shall vest no right in either party hereto. This lease shall become effective
only after the full execution and delivery hereof by all of the parties hereto and upon the approval by the
holder of any mortgage encumbering the Project.
28.17 This lease has been entered into by the undersigned parties after arms-length negotiation,
with each party hereto hereby acknowledging that it and its counsel, if it so chooses, have had an opportunity
to review this lease, and therefore, the parties agree that this lease shall not be construed against Landlord
on the ground that Landlord’s representatives prepared this lease.
28.18 This lease may be executed in several counterparts, each of which will be deemed an
original, and all of which will constitute but one and the same instrument. Furthermore, any counterpart
that is signed and returned by facsimile or electronic transmission shall be deemed properly signed and
delivered.
28.19 Tenant shall not record this lease nor any memorandum or short form hereof, nor shall
Tenant permit or cause same to be recorded, without Landlord’s prior written consent. Any attempted
recordation of this lease or of a memorandum or short form hereof by Tenant without having first obtained
Landlord’s written approval -- which approval may be granted or denied in Landlord’s sole discretion --
shall, at Landlord’s option, constitute an event of default by Tenant and, at Landlord’s option, may void
this lease and Tenant’s rights hereunder.
28.20 This lease is for the sole benefit of Landlord and Tenant, and, other than any ground lessor
under any ground lease and/or any holder of any mortgage, deed of trust or other lien encumbering the
Project (or any part thereof), no third party shall be deemed a third party beneficiary hereof.
28.21 Tenant’s obligations under this lease (including, without limitation, each indemnity
agreement and hold harmless agreement of Tenant contained herein) shall survive the expiration or earlier
termination of this Lease.
28.22 IT IS AGREED BY AND BETWEEN LANDLORD AND TENANT THAT THE
RESPECTIVE PARTIES HERETO SHALL, AND THEY HEREBY DO, WAIVE TRIAL BY JURY
IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM BROUGHT BY EITHER OF THE
PARTIES HERETO AGAINST THE OTHER ON ANY MATTERS ARISING OUT OF OR IN
ANY WAY CONNECTED WITH THIS LEASE, THE RELATIONSHIP OF LANDLORD AND
TENANT, AND/OR TENANT’S USE OR OCCUPANCY OF THE DEMISED PREMISES.
28.23 Landlord acknowledges that Tenant is a political subdivision of the State of Texas, and in
leasing the Demised Premises, Tenant is engaging in a governmental function. Notwithstanding any other
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term of this agreement, Tenant is not and has not waived any governmental immunities that Tenant is or
would be entitled to assert.
28.24 This lease consists of twenty-eight articles and Exhibits “A” through “K”. All exhibits,
attachments and addenda referred to herein shall be considered a part hereof for all purposes with the same
force and effect as if copied at verbatim herein. The exhibits and/or addenda attached hereto are listed as
follows:
Exhibit “A” Site Plan of the Project
Exhibit “B” Demised Premises
Exhibit “C” Construction: Building Office Shell
Exhibit “D” Prohibited and Restricted Uses
Exhibit “E” Relinquishment of Lien Rights
Exhibit “F” Sign Criteria
Exhibit “G” Tenant Estoppel Certificate
Exhibit “H” Intentionally Omitted
Exhibit “I” Intentionally Omitted
Exhibit “J” Communications Antenna
Exhibit “K” Rules and Regulations
[Signature page follows]
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EXECUTED as of the date first set forth above.
LANDLORD:
KRG TOWN SQUARE VENTURES, LLC,
A Delaware limited liability company
By:
Name: __________________________
Title: __________________________
TENANT:
The City of Southlake, Texas, a municipal corporation
By:
Name:
Title:
Taxpayer I.D. No.:
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EXHIBIT “A”
SITE PLAN OF THE PROJECT
THIS SITE PLAN IS PRESENTED SOLELY FOR THE PURPOSE OF IDENTIFYING THE
APPROXIMATE LOCATION AND SIZE OF THE DEMISED PREMISES. BUILDING SIZES, SITE
DIMENSIONS, ACCESS AND PARKING AREAS, EXISTING TENANT LOCATIONS AND
IDENTITIES ARE SUBJECT TO CHANGE AT THE LANDLORD’S DISCRETION, EXCEPT AS
OTHERWISE EXPRESSLY RESTRICTED IN THE TEXT OF THE LEASE. THE PROJECT
INCLUDES LAND THAT IS OWNED (OR WILL BE OWNED) BY LANDLORD AND ITS
AFFILIATES, BUT THE PROJECT WILL BE OPERATED AS A UNIFIED WHOLE.
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EXHIBIT “B”
DEMISED PREMISES
THIS PLAN IS PRESENTED SOLELY FOR THE PURPOSE OF IDENTIFYING THE APPROXIMATE
LOCATION AND SIZE OF THE DEMISED PREMISES. BUILDING SIZES, SITE DIMENSIONS,
ACCESS AND PARKING AREAS, EXISTING TENANT LOCATIONS AND IDENTITIES ARE
SUBJECT TO CHANGE AT THE LANDLORD’S DISCRETION, EXCEPT AS OTHERWISE
EXPRESSLY RESTRICTED IN THE TEXT OF THE LEASE.
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EXHIBIT “C”
CONSTRUCTION: TENANT ACCEPTANCE OF SPACE “AS-IS”
ARTICLE 1
GENERAL
A. Tenant hereby accepts the Demised Premises “As-Is” and agrees same is “ready for
occupancy”. Landlord has made no representations or warranties as to the condition of the Demised
Premises.
B. If, for any reason the Demised Premises are not ready for occupancy by the estimated date
specified in Section 1.1(k) above, Landlord cannot be deemed to be in default or otherwise liable in damages
to Tenant, nor shall the term of this lease be affected.
C. By occupying the Demised Premises, Tenant will be deemed to have accepted the same
and to have acknowledged that the same fully comply with Landlord’s covenants and obligations under this
lease. Occupancy of the Demised Premises by Tenant prior to the Commencement Date is subject to all of
the terms and provisions of this lease, excepting only those requiring the payment of rent.
ARTICLE II
PRE-CONSTRUCTION OBLIGATIONS
A. All plans, diagrams, schedules, specifications and other data relating to work to be
performed by Tenant (“Tenant’s Work”) must be furnished by Tenant to Landlord complete, sufficient to
obtain a building permit, and ready for Landlord’s consideration and final approval within thirty (30) days
after execution of this lease. Without limiting the generality of the immediately preceding sentence,
Tenant’s submissions must include a floor plan, a reflected ceiling plan, a plumbing, electrical and HVAC
plan, elevations of walls and a fixture plan. All drawings must be at a scale of either 1/8” or 1/4”. Tenant
must reimburse Landlord for any loss or extra cost which may result to Landlord by reason of failure on
the part of Tenant to submit any such plans, diagrams, schedules, specifications and/or other data within
such time period.
B. Tenant shall secure Landlord’s written approval of all designs, plans, specifications,
materials, contractors and contracts for work to be performed by Tenant , including design fabrication and
installation of signage, before beginning the work (including following whatever “work letter” instructions,
if any, which Landlord may deliver to Tenant in connection with the work), and shall promptly apply for
all necessary licenses and permits to be used in performing the work and thereafter diligently pursue receipt
of and secure same. Tenant shall provide Landlord with copies of any such applications within five (5)
days of Tenant’s submittal and shall provide Landlord with copies of any such licenses, certificates and
permits within five (5) days of receipt. Tenant’s finished work shall be subject to Landlord’s approval and
acceptance. Except with respect to signage, where Landlord’s approval is required hereunder, Landlord
agrees to either approve or reject same within five (5) business days of Landlord’s receipt of all the required
documentation and if not approved or rejected within said five (5) day period, Landlord’s approval shall be
deemed given.
C. Should Tenant request and Landlord approve any variation in the interior finishing of the
Demised Premises, the variation must be incorporated in the plans to be furnished by Tenant and approved
by Landlord.
D. The insurance requirements under Article 15 of the lease and the indemnity requirements
under Article 16 of the lease shall apply during the construction contemplated in this exhibit, and Tenant
must provide evidence of appropriate insurance coverage prior to beginning any of Tenant’s Work. In
addition, and without limiting the generality of the immediately preceding sentence, at Landlord’s option,
Landlord may require that prior to beginning any of Tenant’s Work, Tenant must provide Landlord with
evidence of insurance covering both Tenant and Tenant’s contractor against damage to their personal
property, as well as against third-party liability and worker’s compensation claims arising out of all
construction and associated activities, as stated below:
1. Worker’s Compensation at statutory limits, as required by the state where work is
being performed and Employer’s Liability with limits no less than One Million Dollars
($1,000,000.00) for each accident or occupational disease.
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2. Commercial General Liability, including Premises Operations, Products, and
Completed Operations Liability, Independent Contractors Liability, Contractual Liability and
Broad Form Property Damage Liability with limits no less than:
Bodily Injury and Two Million Dollars ($2,000,000.00)
Property Damage each occurrence/aggregate
Personal Injury Liability Two Million Dollars ($2,000,000.00)
each occurrence/aggregate
Such liability insurance shall provide coverage for explosion, collapse, and underground exposures,
if applicable, and contractual liability coverage, shall insure Tenant’s contractors and any
subcontractors against any and all claims for personal injury, including death resulting therefrom,
and damage to property of others arising from operations under contracts whether such operations
are performed by Tenant’s contractors or by any subcontractor for whose acts any of them may be
liable and shall include the condition that it is primary and that any liability insurance maintained
by Landlord or any other additional insured is excess and noncontributory.
3. Comprehensive Automobile Liability Insurance, including the ownership,
maintenance, and operation of any automobile equipment owned, hired, and non-owned, including
the loading and unloading thereof in the following minimum amounts:
Bodily Injury and Two Million Dollars ($2,000,000.00)
Property Damage Liability each accident
4. Umbrella Liability Insurance covering all operations of contractor with limits no
less than:
Bodily Injury and Two Million Dollars ($2,000,000.00)
Property Damage Liability each occurrence/aggregate
5. Builder’s Risk Completed Value Form covering All Risks of Physical Loss or
Damage on Tenant’s Work in the Demised Premises as it relates to the building in which the
Demised Premises are located, naming Landlord and its agents and employees and Tenant’s
contractors as additional insureds, as their respective interests may appear.
All policies of insurance are subject to Landlord’s prior approval and special conditions,
including the following:
a. Each policy must be endorsed to provide that the carrier waives its right
of subrogation against Kite Realty Group, L.P., and KRG Town Square Ventures, LLC.
b. Each policy shall be endorsed to name Kite Realty Group, L.P., and KRG
Town Square Ventures, LLC as additional insureds, and to ensure that the policy is primary over
any other applicable insurance.
ARTICLE III
RESERVED
ARTICLE IV
DESCRIPTION OF TENANT’S WORK
A. Utilities: All meters or other measuring devices which monitor utilities exclusively
provided to the Demised Premises shall be provided by Tenant (it being agreed that Landlord will provide
all meters monitoring common area and multiple-tenant usage). All service deposits for utilities and meters
for which Tenant is responsible shall be made by Tenant at Tenant’s expense.
B. Interior Work:
1. The work to be done by Tenant shall include, but shall not be limited to, the
purchase and installation (in a good and workmanlike manner by licensed
contractors) of the following at the Demised Premises:
a. Electrical fixtures. NOTE – Offices fronting Main, Grand and State
Streets are required to install can lighting at additional cost to the Tenant.
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b. Interior partitions, including finishing, electrical wiring, and connections
within the Demised Premises.
c. Special hung or furred ceilings.
d. Interior painting.
e. Tenant fixtures and furnishings.
f. Plumbing fixtures within the Demised Premises.
g. Insulation (except as provided herein).
h. Floor covering and base.
i. Side wall demising partition finish-out including metal studs, gypsum
board, tape and bed.
j. Modifications to ceiling grid-in-place and installation of ceiling tile.
k. Mechanical systems, including ductwork, diffusion and controls.
l. Low voltage power grids and lighting power grids.
m. Millwork within the Demised Premises.
n. Modifications to the shell building fire protection system to fit Tenant
space.
o. Special ventilation requirements.
p. Permits for construction.
q. Architectural design fees.
r. Suite Signage.
s. TAS review fees.
t. Dedicated phone boards and electrical outlets (if required).
u. Window blinds (required upgrade).
C. All work undertaken by Tenant shall be at Tenant’s expense and shall not damage the
building or any part thereof. Any roof penetration shall be performed by Landlord’s roofer or, at Landlord’s
option, by a bonded roofer approved in advance by Landlord. The work shall be begun only after Landlord
has given consent, which consent shall in part be conditioned upon Tenant’s plans, to include materials
acceptable to Landlord, in order to prevent injury to the roof and to spread the weight of any equipment
being installed. Tenant shall also be responsible for obtaining, and paying for, professional inspections of
any structural work (including, without limitation, any roof work or concrete work).
D. Landlord will receive a copy of Tenant’s building permit within five (5) days after said
permit is issued to Tenant, and before construction begins in the Demised Premises. Landlord will receive
a $2,500 security deposit if Tenant chooses another contractor to complete their work. This money will be
used, at the Landlord’s discretion, to clean-up or repair behind Tenant’s contractor. Landlord will initiate
clean-up or repair requests to Tenant’s contractor. Tenant contractor has 24 hours to respond or Landlord
will perform requested services with the deposited funds. Should the deposit amount prove insufficient for
clean-up or repairs, Tenant will be responsible for overages. Should funds from the deposit remain upon
completion, they will be refunded to Tenant.
E. All work to be performed outside the physical boundaries of the Demised Premises (i.e.,
plumbing tie-in, electrical tie-in in other tenant spaces due to specific tenant design requirements) shall be
awarded to Landlord’s contractor. Any cost associated with security or monitoring of other spaces as a
result of Tenant’s construction, is the responsibility of the Tenant.
F. If Tenant selects Landlord’s contractor to perform construction, a construction
management fee will be charged to reimburse Landlord for the cost of its coordination and supervision of
Tenant’s Work. There will be a minimum fee of $3,000 for this service. Tenant is responsible for all
reimbursable Architectural and Consultant expenses associated with the design of the Demised Premises.
G. At Landlord’s option, the following will be furnished to the Landlord before the Tenant
will be allowed to take possession of the Demised Premises:
· Contractors Affidavit of Payment of Debts and Claims (with an attachment list of
subcontractors) (AIA Document G706).
· Contractors Affidavit of Release of Liens (AIA Document G706A), together with
final lien waivers from the contractor and all subcontractors.
· A Certificate of Occupancy from the inspecting governmental authority.
· Copies of warranties on Tenant installed equipment as well as operations manuals.
H. Intentionally Omitted
INITIALED:
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LANDLORD:
TENANT:
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EXHIBIT “D”
PROHIBITED AND RESTRICTED USES
Tenant shall not use the Project in whole or in part for the following uses:
1. any use which constitutes a public or private nuisance;
2. any use causing loud noises or noxious or offensive smoke or odors (including any business using
exterior loud speakers);
3. manufacturing facility;
4. dry cleaner (except facilities for drop off and pick up of clothing cleaned at another location);
5. any facility for the sale, lease, or rental of automobiles, trucks, motorcycles, recreational vehicles,
boats or other vehicles;
6. automobile repair shop or service station or any facility storing or selling gasoline or diesel fuel in
or from tanks;
7. used clothing or thrift store or liquidation outlet;
8. massage parlor;
9. adult book shop or adult movie house or so-called “head” shop;
10. off-track betting, gambling, or gaming facility;
11. currency exchange, check cashing or payday loan facility;
12. mortuary or funeral parlor;
13. motor inn or any transient residential use;
14. coin operated laundry;
15. cocktail lounge, night club, bar or tavern or sale of alcoholic beverages, whether or not packaged;
16. cinema or theater;
17. place of recreation (including but not limited to bowling alley, skating rink, carnival game arcade,
gymnasium, disco, or banquet hall);
18. church;
19. fast food drive-throughs;
20. children’s recreational, education, or day-care facility;
21. telemarketing;
22. schools of any nature (as used herein, “school” includes, but is not limited to, a beauty school,
barber college, reading room, place of instruction or any other operation serving primarily students
or trainees rather than retail customers);
23. any type of medical, dental, or other health professional office
24. flea market
25. facility for the sale of paraphernalia for use in connection with illicit drugs
26. car wash
27. carnival, amusement park or circus
28. auction, fire or going-out-of-business sale
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29. any use which includes (as a regular or incidental part thereof) the operation of motor vehicles at
speeds which may exceed the posted speed limit, even if such operation of motor vehicles at speeds
above the posted speed limit is allowable by law
30. jail, penitentiary, correctional facility, penal facility, detention or holding facility or similar facility
31. any other use inconsistent with the operation of an upscale, high-end, high quality retail and
professional office development; and
32. any unlawful use.
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EXHIBIT “E”
RELINQUISHMENT OF LIEN RIGHTS
THE STATE OF TEXAS §
§
COUNTY OF §
The undersigned, by written agreement dated , 2023, (the “Agreement”), has
contracted with (“Tenant”) to furnish certain labor and materials (the “Work”) on the
Tenant’s leasehold estate in certain improvements located on the real property described on Exhibit A
hereto (the “Property”), which is owned by KRG Town Square Ventures, LLC (“Owner”).
The undersigned, in performing such Work, acknowledges that it has entered into a contract with
Tenant for the performance thereof and that any lien rights it may have arising out of performing such work,
including, but not limited to, mechanics’ and materialmens’ liens, whether arising under statutory or
constitutional law, shall attach to and affect only the Tenant’s leasehold estate, and in no event shall the
undersigned have any such lien rights in, to or with respect to, the fee title to the Property.
This Relinquishment of Lien Rights is entered into for good and valuable consideration, including
the Owner’s agreement to provide certain inducements to the Tenant with respect to performance of the
Work.
Executed as of , 2023.
By:
Name:
Title:
THE STATE OF TEXAS §
§
COUNTY OF §
This instrument was acknowledged before me on the day of , 2023, by
of , a
, on behalf of said .
Notary Public, State of Texas
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EXHIBIT “F”
SIGN CRITERIA
Signs will be designed to promote the downtown atmosphere, establish identities of tenants, and
give clear, functional information. All signage will be subject to Landlord’s prior written consent, including
graphic design, materials, construction and method of installation.
I. DEFINITIONS
Awning: A covering attached to a building or structure, erected in or over a window or door, and
usually supported by gravity and a metal frame.
Projection: The distance by which a sign extends over public property or beyond the building line.
Sign, Awning: “Awning Sign” means a sign consisting of one line of letters painted, placed or
installed upon the valance of any awning or canopy and an identification emblem, insignia,
initial or other similar feature painted, placed or installed elsewhere on any awning or
canopy; provided, that any sign, emblem, insignia, initial or other similar feature shall
comply with all other appropriate provisions of this title. Where steel canopies are used,
the Awning Sign may consist of individually cut out metal letters placed on the top of the
canopy’s outside edge parallel to the face of the building.
Sign, Blade: Any sign, oriented perpendicular to the face of the building, identifying the name of
the business, affixed to or supported by a building or structure, which projects more than
twelve inches (12”) beyond the surface of that portion of the building or structure to which
it is affixed or supported.
Sign, Building Blade: A primary Blade Sign permitted either: (a) in lieu of a Fascia Sign; and/or
(b) at a building corner.
Sign, Building Identification: Any sign stating the use and name given to the use of a building,
structure or area, when such use is permitted in the zone in which the sign is located.
Sign, Fascia: A sign affixed directly to the exterior wall or screening surface, confined within the
limits thereof, and which projects from the surface less than twelve inches (12”) at all
points, and located either: (a) above the first floor storefront, and below the second level
windows; or (b) where permitted, above the upper story windows and below the next level
windows or building parapet, as applicable. Fascia Signs are displayed parallel to the face
of the building, and identify the name of the business.
Sign, Pedestrian Blade: A secondary Blade Sign which indicates use or business name and/or logo,
located at least seven feet (7’) above ground.
II. ADMINISTRATION
A. Submittals. Landlord’s approval will be required for all signs to assure compatibility with
the architecture and to verify compliance with these guidelines. There will be three (3) sequential signage
submittals to and/or reviews by Landlord:
1. The concept submittal sketch should indicate the size, shape, color, illumination,
material palette, and type face. Sign(s) should be shown superimposed in scale on the building
elevation.
2. The shop drawing submittal should indicate structural attachments, construction
details, materials, power requirements, illumination levels, dimensions, etc. Each submittal should
also include an updated elevation drawing with the sign shown in scale.
3. Final review by Landlord of the installation must occur prior to Tenant’s final
payment to the sign contractor.
B. Permits. The City of Southlake will require a sign permit. Tenant is responsible for the
sign permit(s), including, without limitation, promptly apply for said permit and thereafter diligently
pursuing receipt of same. Tenant shall provide Landlord with copies of any such applications within five
(5) days of Tenant’s submittal and shall provide Landlord with a copy of any such permit within five (5)
days of receipt.
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C. Costs. All costs associated with the signs and awnings, including design, construction,
permitting, installation, coordination, and supporting structural and electrical infrastructure will be borne
by Tenant. This also includes removal of the signs and awnings upon the expiration or termination of the
lease.
D. Limitations. Signs are limited to the name under which Tenant does business, not including
logos or associated names or trademarks. Use of logos as a decorative element will be reviewed on an
individual basis and, if approved, will be limited to Tenant’s business logo and will not extend to products
or services offered by Tenant.
E. Compliance. Tenant is responsible for strict compliance with these guidelines. Landlord
retains the right but not the obligation to notify Tenants of infractions to the guidelines, and may take any
action it deems necessary to bring Tenant into compliance.
III. SIGN REGULATIONS
A. Number of Signs- The following number of signs shall be permitted.
1. First Floor – There shall be permitted up to a combination of two (2) of the
following three (3) types of signs per use. On each storefront wall which faces a street, drive, or
parking area: (a) one (1) Fascia Sign or one (1) Building Blade Sign; and (b) one (1) Pedestrian
Blade Sign, with all such signs subject to the area requirements. A Building Blade Sign shall be
permitted at a building corner in addition to permitted Fascia Signs, provided such sign is erected
at a 135° angle to the building corner.
2. Above the First Floor - For lease space above the first floor, one (1) Window Sign
or (1) Awning Sign at every other window shall be permitted. In addition, one (1) Fascia Sign may
be permitted on facades of fifty feet (50’) or more in length.
B. Maximum Letter/Logo Height
Lettering. Except as otherwise provided, lettering size shall be determined by the maximum sign
area allowed. Lettering on the following types of Signs shall not exceed the maximum size indicated:
Building Blade Sign - twelve inches (12”)
Pedestrian Blade Sign - eight inches (8”)
First Floor Window/Awning Sign - twelve inches (12”)
Upper Story Fascia Sign - ten inches (10”)
Upper Story Window/Awning Sign - four inches (4”)
C. Maximum Area
The total area of all signs displayed on a storefront wall which faces a street, drive or parking area
shall not exceed one (1) square foot for each foot of storefront width facing the street, drive or parking area.
Size of the following types of Signs shall not exceed the maximum area indicated:
Fascia Sign - thirty (30) sq.ft.
Building Blade Sign - twelve (12) sq.ft.
Pedestrian Blade Sign - four (4) sq.ft.
Notwithstanding the foregoing, on any frontage where public access and a storefront are not
provided, allowable signage on such frontage shall be limited to not more than seventy-five percent (75%)
of the area of the principal signage permitted where public access and a storefront are provided.
The area of all faces of a Blade Sign shall be included in determining the area of the sign, except
where two (2) such faces are placed back to back and are at no point more than two (2) feet from one
another, in which case the area of the Blade Sign shall be taken as the area of a single face if the two (2)
faces are of equal area, or as the area of the larger face if the two (2) faces are of unequal area.
For multi-story buildings, the Maximum Area shall be permitted only for signs displayed between
the sidewalk and a height of twenty feet (20’) on any storefront wall. The total area of all signs displayed
above the twenty foot (20’) height limit shall be: (a) for permitted Fascia Signs, one-half (0.5) square foot
for every one foot (1’) of width of building or lease space; and (b) for Window Signs and Awning Signs,
limited to signage which does not obscure more than twenty-five percent (25%) of the total window area.
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D. Illumination
Examples of permitted first floor signs include:
· Exterior illuminated (by externally mounted spot lighting)
· Silhouette Lighting (e.g., neon illumination behind a solid, opaque letter)
· Up lighting (e.g., projecting fixtures attached to the building under the letters)
· Sign box panel with push through letters, internally illuminated.
· Exposed neon lighting
Neon signs will be reviewed on an individual basis. If the neon contributes decoratively to the
environment and does not create a presence which diminishes attention to its neighbors, approval will be
considered.
Illumination of signs shall be designed, located, shielded and directed in such a manner that the
light source is fixed and is not directly visible from, and does not cast glare or direct light from artificial
illumination upon, any adjacent public right-of-way, surrounding property, residential property or
motorist’s vision.
Attached signs may not be illuminated by internally illuminated, face lit channel cut letters.
Awnings, Awning Signs, Window Signs and Signs above the first floor shall not be permitted to
be illuminated.
E. Signs over/on ROW – Blade Signs shall not be higher than the eave line or parapet wall of
the top of the principal building; shall be a minimum of seven feet (7’) above grade when located adjacent
to or projecting over a pedestrian way; and shall not extend more than four feet (4’) from the building wall
to which they are attached, except where such sign is an integral part of an approved canopy or awning.
F. Awnings. Awnings may be permitted on a case-by-case basis and will be subject to
Landlord review and approval.
1. Awning materials can be fabric or painted metal. Material samples must be
submitted with design. The design, color and material must be approved in writing by Landlord
prior to fabrication.
2. Awnings must extend not less than three feet (3’) and not more than three feet six
inches (3’6”) from the building face. The bottom of the structure must be at least seven feet (7’)
above the sidewalk. Each awning must be equal in length to the window behind it. All awnings
on any facade must be at the same height, although adjacent facades may vary in height.
3. Signage on the awnings is limited to the vertical front edge of the awning in text
and/or graphics and in color approved by Landlord. Logos will be permitted as approved by
Landlord on the top surface only in the event that they are used decoratively and are limited to
Tenant’s logo. No signage is permitted on the underside of the awning.
4. Awnings with closed, illuminated soffits are not permitted.
5. Awning and support framing will be installed by Tenant subject to Landlord’s prior
written approval as to method of installation.
G. Service Door Signs. Non-customer doors receiving merchandise will have uniformly
applied signs designed and installed by Landlord at Tenant’s expense. Tenant will supply Tenant’s name
and address to Landlord for sign fabrication and installation.
H. Temporary Signs.
1. Window Signs - Window signs are permitted during construction of tenant
improvements to obscure up to one hundred percent (100%) of the total window area, provided that
no such sign may be displayed for a period longer than 120 days.
2. Construction Barricades - Signage on a construction barricade shall be permitted
along each building or lease space frontage for sites under construction, provided that:
· No such barricade shall be located within twenty-five feet (25’) of a public right-
of-way; and
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· Such signs may be erected and maintained only for a period beginning not earlier
than five (5) days prior to commencement of construction and shall be removed
upon termination of construction, with the total of such period not to exceed 120
days.
3. Any temporary signs such as “Opening Soon” or “Sale” signs must be approved
by Landlord in writing in advance.
I. Unacceptable Signage.
1. Prohibitions include the following:
a. Internally illuminated, face lit channel cut letters.
b. Internally illuminated boxes.
c. Flashing, rotating, blinking, or other moving signs.
d. Reader boards, matrix boards, or other light grids which can produce a
changeable image.
e. Signs producing odors or sound.
2. Non-conforming signs will be reviewed on an individual basis by Landlord and
the City of Southlake. Any signs which are not covered under these guidelines are not permitted
unless specifically approved in writing, in advance, by Landlord. However, approval by Landlord
does not guarantee approval by the City of Southlake.
J. Non-Conforming Signs
In recognition of the uniqueness of the downtown environment, individuality of signage is
encouraged. Certain signs, while not technically meeting the requirements set forth herein, will nonetheless
be considered for approval on a case-by-case basis. Such signage may be approved if it:
· Harmonizes with the structure or structures on the parcel on which it is to be
applied;
· Is compatible with the other signs or graphic designs on the premises;
· Is suitable and appropriate to the Town Square;
· Contributes to any special characteristics of the particular area in which it is to be
located;
· Is well designed and pleasing in appearance;
· Is desirable as an urban “downtown” design characteristic;
· Does not constitute a nuisance to the occupants of adjacent or contiguous property;
· Is not detrimental to property values; and
· Does not constitute a traffic and safety hazard because it is distracting, or is not
considered obscene, lewd, indecent or otherwise offensive to public morals.
Approval of any such signage shall be subject to any conditions which in Landlord’s judgment are
necessary to carry out the purposes and intent of the review standards.
2023-10-20 - Southlake Town Square - City of Southlake - Office Lease - Version 4 (KRG) G-1
EXHIBIT “G”
TENANT ESTOPPEL CERTIFICATE
To: (“Lender”)
Re: Property Address: ___________________________________________________ (“Property”)
Lease Date: ___________________________________________________________________
Between _______________________________________________________ (“Landlord”) and
____________________________________________________________________ (“Tenant”)
Square Footage Leased: __________________________________________________________
Suite No./Floor: ______________________________________________________ (“Premises”)
Tenant understands that Lender is contemplating making a loan (the “Loan”) to Landlord. The
undersigned, as the tenant under the above-referenced lease (“Lease”) hereby certifies to Lender, the
following:
1. The Lease is in full force and effect and has not been modified, supplemented, or amended
in any way except by amendment(s) dated , [Please insert the
phrase “N/A” if the Lease has not been amended] and, together with such referenced amendments (if
any), represents the entire agreement between the parties as to the Premises or any portion thereof. As used
in this estoppel, the term Lease shall be deemed to include any amendments referenced in the first sentence
of this Paragraph 1. Attached hereto is a true, correct and complete copy of the Lease. [Attach Lease,
including all amendments]
2. The amount of fixed monthly rent is $ ; the monthly common area or other
charges are $ . If applicable, the base year for operating expenses and real estate taxes, as defined
in the Lease, is . No such rent has been or will be paid more than one (1) month in advance
of its due date, except: .
3. The undersigned’s security deposit is $ . The undersigned has paid rent for the
Premises up to and including , 20__. The undersigned hereby waives collection of the deposit
against Lender or any purchaser at a foreclosure sale, unless Lender or such purchaser actually received the
deposit from Landlord.
4. Lender will not be bound by any material modification or amendment to the Lease made
without Lender’s prior written consent, which consent shall be Landlord’s responsibility to obtain.
5. The commencement date of the Lease was , 20__, the Lease
terminates on , and we have the following renewal/extension option(s)
.
6. All work to be performed for us under the Lease has been performed as required and has
been accepted by us; and any payments, free rent, or other payments, credits, allowances or abatements
required to be given by Landlord to us have already been received by us, except
.
7. The Lease is free from default by Landlord; we have no offset, defense, deduction or claim
against Landlord.
8. The undersigned has received no notice of any prior sale, assignment, pledge or other
transfer of the said Lease or of the rents received therein, except
.
9. The undersigned has not assigned said Lease or sublet all or any portion of the Premises,
the undersigned does not hold the Premises under assignment or sublease, nor does anyone except us and
our employees occupy the Premises except
.
10. The undersigned has no right or option to purchase all or any part of the Premises or the
building of which the Premises is a part or to occupy any additional space at the Property.
11. No actions, whether voluntary or otherwise, are pending against the undersigned under the
bankruptcy laws of the United States or any state and there are no claims or actions pending against the
undersigned which if decided against us would materially and adversely affect our financial condition or
our ability to perform the tenant’s obligations under the Lease.
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12. Tenant acknowledges that Landlord has assigned to Lender its right, title and interest in
the Lease and to the rents due thereunder, and that Landlord will collect such rents provided no event of
default has occurred under the Loan. Tenant agrees to pay all rents and other amounts due under the Lease
directly to Lender upon receipt of written demand by Lender, and Landlord hereby consents thereto. The
assignment of the Lease to Lender, or collection of rents by Lender pursuant to such assignment, shall not
obligate Lender to perform Landlord’s obligations under the Lease.
13. If the undersigned is not the party named in the Lease, describe below the chain of
assignments into the undersigned and attach a copy of each assignment document hereto:
.
14. The undersigned recognizes that Lender would not make the Loan to Landlord but for its
execution of this Tenant Estoppel Certificate. The statements contained herein may be relied upon by the
Lender its successors and assigns and by third (3rd) parties who are interested in the matters covered by
this Tenant Estoppel Certificate.
15. In the event that Lender succeeds to the interest of Landlord or any successor to Landlord,
then Tenant hereby agrees to attorn to and accept Lender and to recognize Lender as its landlord under the
Lease for the then remaining balance of the term thereof, and upon request of Lender, Tenant shall execute
and deliver to Lender an agreement of attornment reasonably satisfactory to Lender.
If we are a corporation, the undersigned is a duly appointed officer of the corporation signing this
certificate and is the incumbent in the office indicated under his name. In any event, the undersigned is
duly authorized to execute this certificate.
Dated this day of , 20__.
TENANT:
a(n)
By:
Name:
Title:
ATTACH LEASE, including all amendments
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EXHIBIT “H”
Intentionally Omitted
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EXHIBIT “I”
Intentionally Omitted
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EXHIBIT “J”
COMMUNICATION ANTENNA
1. License to Use Antenna Site. Throughout the term, Landlord grants to Tenant a nonexclusive
license to install, maintain, and operate a communication satellite dish and associated cabling (collectively,
“Antenna”) on a portion of the roof of the building designated by Landlord as the “Antenna Site”. Tenant
may use the Antenna Site only for the purpose of providing communications services for Tenant’s business
activities in the building – Tenant may not provide communications services from the Antenna Site for any
third party. Landlord shall provide reasonable access to the Antenna Site to Tenant and Tenant’s
contractors, subject to Landlord’s rules and regulations regarding controlled access to the roof. Tenant’s
access to the Antenna must be coordinated through Landlord and Landlord’s representative may accompany
Tenant or any of Tenant’s contractors during such access. Landlord makes no representation to Tenant
regarding the suitability of the Antenna Site for Tenant’s Antenna – Landlord is not responsible for any
electrical output, electromagnetic output, radio frequency, or other interference with the Antenna.
Furthermore, Tenant covenants that its Antenna may not interfere with any other communication equipment
on the roof of the building or with Landlord’s building systems.
2. Installation. Tenant shall install the Antenna on the Antenna Site in accordance with plans,
specifications and technical standards approved in advance by Landlord. These plans and specifications
must indicate the size of the Antenna, the means of attaching the Antenna to the roof of the building, and
the methods for screening the Antenna so that it is not visible to the public from the Common Areas or
public streets. Tenant and Tenant’s contractors performing the installation of the Antenna must comply
with the terms and conditions of Article XI (Alterations) and Exhibit “C” to the Lease. Any penetrations
of the building roof must be performed by a contractor designated by Landlord so as to maintain the building
roof warranties. Landlord may elect to perform any of such work which affects building systems with its
own personnel or contractors, and Tenant shall promptly reimburse Landlord therefor, as additional rent.
3. Governmental Compliance. Tenant is solely responsible for securing, at Tenant’s expense, all
necessary approvals from state, federal and other governmental authorities to construct, operate and
maintain the Antenna, but Landlord shall reasonably cooperate with Tenant to obtain these approvals.
Tenant shall construct and maintain the Antenna in accordance with the requirements of the insurers of the
building and with reasonable rules, regulations and technical standards of Landlord relating to use of th e
building roof as Landlord may establish from time to time. Tenant shall give to Landlord written notice of
any notices received by Tenant from third parties stating that the Antenna is or may be in violation of any
law, ordinance or regulation.
4. License Fee. In consideration of this license granted by Landlord, Tenant shall pay Landlord,
without demand, offset or counterclaim, a monthly fee of $100.00 commencing upon the installation of the
Antenna and continuing until Tenant’s removal of all of its equipment from the Antenna Site. Landlord
may increase this monthly fee for any renewal of the initial term. Additionally, Tenant shall pay for all
electricity consumed by such Antenna and the cost of any separate meters to determine such consumption.
5. Maintenance and Removal of Antenna. Tenant shall maintain Antenna in good working order and
repair and shall keep the area immediately surrounding the Antenna neat and clean. Tenant may not erect
or display any sign, advertisement, placard or lettering on such Antenna. Tenant’s use and maintenance of
the Antenna may not create any nuisance or interfere with any other licensee or tenant of the Building.
Landlord has no obligation to maintain, operate or safeguard the Antenna. Upon the expiration or
termination of the lease or at any time that Tenant is no longer using the Antenna, Tenant must remove the
Antenna at Tenant’s sole cost and expense and must promptly repair, at its own expense, any damage to the
building resulting from this removal.
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EXHIBIT “K”
RULES AND REGULATIONS
1. Sidewalks, doorways, vestibules, halls, stairways and similar areas shall not be obstructed by
tenants or their employees, agents, contractors, invitees, or guests, or used for any purpose other than ingress
and egress to and from their demised premises and for going from one part of the Office Building to another.
2. Plumbing fixtures and appliances shall be used only for the purposes for which constructed, and
no sweepings, rubbish, rags or other unsuitable material shall be thrown or placed therein. Any stoppage
or damage resulting to any such fixtures or appliances from misuse on the part of a tenant or such tenant’s
employees, agents, contractors or invitees shall be paid by such tenant.
3. No nails, hooks or screws shall be driven into or inserted in any part of the Office Building,
except by building maintenance personnel, except in connection with the hanging of pictures or artwork.
4. Smoking of cigarettes, pipes, cigars or other tobacco products is prohibited anywhere within the
Common Areas, including without limitation lobbies, rest rooms, stairways, corridors and the garages;
provided, however, Landlord may, from time to time, designate certain portions of the Common Areas as
“Designated Smoking Areas”, in which event smoking shall be permitted in only such areas.
5. No tenant may place any partitions on its leased premises which exceed twenty (20) pounds per
square foot live load, nor may any tenant place any equipment, furniture, safes, filing systems or other
property on its leased premises which exceeds fifty (50) pounds per square foot live load. All damage done
to the Office Building by the improper placing of heavy items which overstress the floor will be repaired at
the sole expense of the tenant.
6. All movement of safes, equipment, furniture, freight or bulky items of any description shall be
performed by persons approved by Landlord under the supervision of Landlord during the hours and
according to such routes and methods as Landlord designates from time to time. Each tenant shall notify
Landlord prior to the delivery of any such items. Landlord may check the weight and position of safes and
other heavy items to assure compliance with these Rules and Regulations and the tenant’s lease, and all
such items shall stand on weight distribution devices approved by Landlord. Landlord reserves the right to
inspect all freight to be brought into the Office Building and to exclude from the Office Building all freight
which violates any of these Rules and Regulation or the tenant’s lease. All damages done to the Office
Building by the movement or positioning of any property of a tenant will be repaired at the expense of such
tenant and Landlord will not be liable for the acts of any person engaged in, or any damage or loss of any
property or person resulting from, any act in connection with such movement or positioning. All hand
trucks and dollies used in the Office Building by a tenant or its employees, agents, contractors or invitees
must be equipped with rubber tires, and all such hand trucks must be equipped with side guards.
7. Corridor doors, when not in use, shall be kept closed.
8. Each tenant shall cooperate with Office Building employees in keeping the premises neat and
clean. Each tenant shall assist in preventing any hindrance of the work of the janitor or cleaning personnel
after normal business hours of the Office Building established by Landlord.
9. Nothing shall be swept or thrown into the corridors, halls, elevator shafts or stairways. No birds,
animals or reptiles, or any other creatures, shall be brought into or kept in or about the Office Building,
except for seeing eye dogs assisting the disabled.
10. Neither fire arms, nor weapons, nor flammable, explosive or other hazardous liquids or
materials shall be brought into any leased premises or into the Office Building without the prior written
consent of Landlord.
11. Neither Tenant, nor its employees, agents, contractors, invitees, or guests shall make or permit
any unseemly, objectionable or improper noises and/or disturbances in the Office Building and/or Common
Areas, or otherwise interfere in any way with other tenants of the Office Building, or persons having
business with them.
12. Canvassing, soliciting and peddling in the Office Building and/or Common Areas are
prohibited and each tenant will cooperate with Landlord to prevent same.
13. No tenant shall sell lottery tickets or conduct any other form of gambling from or within its
leased premises or any other part of the Office Building.
14. Tenants shall not use or keep in the Office Building any illuminating material unless it is battery
powered, UL approved, or any inflammable or explosive fluid or substance.
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15. Tenants, employees or agents, or anyone else who desires to enter the Office Building after
normal business hours may be required to sign in upon entry and sign out upon leaving, giving the location
during their stay and their time of arrival and departure.
16. Landlord has the right to evacuate the Office Building in event of emergency or catastrophe or
when required by any governmental authority.
17. Landlord will not be responsible for personal property, equipment, money or jewelry lost or
stolen from the Demised Premises.
18. No bicycles, motorcycles or similar vehicles will be allowed in the Office Building.
19. No tenant may change any locks or electronic security devices or place additional locks or
electronic security devices upon any doors without the prior written consent of Landlord. All keys and
electronic access cards shall be furnished by Landlord, and the same shall be surrendered upon termination
of the tenant’s lease, and the tenant shall then give Landlord or its agent an explanation of the combination
of all locks and the workings of all electronic security devices on the doors or vaults.
Each tenant shall notify Landlord in writing of the names of its employees authorized to retain and use a
key or electronic access card to gain entry into the Office Building.
20. Tenants will not locate furnishings or cabinets adjacent to mechanical or electrical access
panels or doors or over air conditioning outlets so as to prevent operating personnel from servicing such
units as routine or emergency access may require. Cost of moving such furnishings for Landlord’s access
will be for the tenant’s account.
21. Each tenant will promptly notify Landlord of any accident which occurs and any defect or
repair or maintenance required in the tenant’s leased premises, regardless of who is responsible under the
tenant’s lease for taking corrective action.
22. No portion of the Office Building or any leased premises shall be used for the purpose of
sleeping or lodging.
23. No vending machines or dispensing machines of any kind will be placed in the leased premises
by a tenant without Landlord’s prior written consent, except in Tenant’s break room or kitchen.
24. No tenant, without Landlord’s prior written consent, will (a) permit any cooking on the tenant’s
leased premises other than warming of pre-cooked food by the tenant’s employees for consumption on the
leased premises, (b) operate any restaurant, luncheonette, cafeteria or other kitchen facility for the sale or
service of food or beverages to the tenant’s employees or others, or (c) cause or permit any odors of cooking
or other processes or any unusual or objectionable odors to emanate from the leased premises. No food or
beverages will be carried in the Common Areas or elevators except in closed containers.
25. From time to time upon Landlord’s request, each tenant, at the tenant’s expense, will cause its
leased premises to be exterminated to the satisfaction of, and by exterminators approved by, Landlord. A
tenant will not otherwise exterminate its leased premises without the prior written consent of Landlord.
Landlord reserves the right to rescind any of these Rules and Regulations and make such other rules
and regulations as in the judgment of Landlord shall from time to time be needed for the management,
safety, protection, care and cleanliness of, and the preservation of good order and protection of property in,
the Office Building, which rules and regulations when made and notice thereof given to a tenant shall be
binding upon the tenant in like manner as if originally herein prescribed. In the event of any conflict or
inconsistency between the terms and provisions of these Rules and Regulations, as now or hereafter in
effect, and the terms and provisions of any lease now or hereafter in effect between Landlord and any tenant
in the Office Building, Landlord may enforce the term or provision in either such lease or such Rules and
Regulations which is most restrictive on such tenant.
Without limiting the remedies available to Landlord in the event of a default by Tenant under the Lease,
should Tenant violate the Rules and Regulations set forth in this Exhibit “J” more than two (2) times during
the Term of the Lease, Landlord shall have the right to terminate the Lease by written notice to Tenant.