ADDENDUM TO LEASE AGREEMENT
This Addendum is incorporated by reference into and is a part of that certain Lease Agreement (the "Lease") between __________________________________________ as Landlord, and ___________________________________ as Tenant. The term "Premises" as used in this addendum shall mean the Leased Premises described in Section _____ of the Lease, and the term "Building" as used herein shall mean the building described in the Lease and of which the Premises are a part. Except as otherwise indicated herein, all defined terms in the Lease shall have the same meaning in this Addendum.
1. Completion of Construction. The Lease shall, at Tenant's option, be terminated in the event Landlord has not commenced construction of the Premises within _____ days after the date of the Lease, or if the Premises are not completed by Landlord and ready for occupancy within _____ days after the date of the Lease. If the Premises are not completed by such date but Tenant does not elect to cancel the Lease, the Landlord shall reimburse Tenant on demand for all additional or "holdover" rent incurred by Tenant after such date for Tenant's current leased space to the extent such rent exceeds the rent Tenant would have paid during such period of time under this Lease. Notwithstanding anything contained in Section _______ of the Lease, taking of possession of the Premises by Tenant shall not be deemed an acceptance by Tenant of any latent defects or matters of which Tenant notifies Landlord in writing within 30 days after occupancy, which latent defects and other matters Landlord agrees to correct within a reasonable time after notification thereof.
2. Operating Expenses Exclusive. Notwithstanding anything contained in Section _____ of the Lease to the contrary, the following shall be excluded from Operating Expenses for the purposes of the Lease:
(a) The cost of repairs, replacements, or other work occasioned by fire, windstorm, flood, or other casualty, or the exercise by governmental authorities of the right of eminent domain;
(b) Leasing commissions, attorney's fees, costs and disbursements and other expenses incurred in connection with negotiations for leases with tenants, other occupants of the building and similar costs incurred in connection with disputes between Landlord and tenants of the Building.
(c) Tenant allowances, concessions, or other costs incurred in building out, completing, renovating or otherwise improving or decorating or redecorating space for tenants or other occupants in the Building or vacant leasable space in the Building.
(d) Costs of correcting defects (including latent defects) in the construction of the Building, parking areas or other improvements, or in the equipment used therein, except that, for the purposes of this subparagraph, conditions resulting from ordinary wear and tear and use, vandalism, and other matters not occasioned by construction defects shall not be deemed defects.
(e) Landlord's costs of electricity and other services sold to tenants and which are not standard for the Building, or for which Landlord is reimbursed by tenants as an additional charge or rental.
(f) The cost of any improvements, repairs, alterations, additions, changes, replacements, equipment, tools and other items which under generally accepted accounting principles are required to be classified as capital expenditures (whether incurred directly or through a lease or service contract or otherwise).
(g) Depreciation of the Building and all equipment, fixtures, improvements and facilities used in connection therewith.
(h) Material expenses in connection with services or other benefits of a type which are not standard for the Building and which are not available to Tenant without specific charge therefor, but which are provided to another tenant or occupant.
(i) Costs (including penalties, fines and associated legal expenses) incurred due to the violation by Landlord of the terms and conditions of the Lease, or any applicable federal, state, and local governmental laws, ordinances, orders, rules and regulations, which costs would not have been incurred but for such violation by Landlord.
(j) Except for management fees, overhead and profit increments paid to subsidiaries, partners or other affiliates of Landlord for services on or to the Building, any appurtenant garage or the property on which the Premises are located, to the extent that the costs of such services exceed competitive costs for such services rendered by persons or entities of similar skill, competence and experience, other than a subsidiary of Landlord. Management fees charged to Operating Expenses shall not exceed similar fees charged in connection with the operation of projects of like location, size, character and quality.
(k) Interest on debt or amortization payments on any mortgage or mortgages, and rental under any ground or underlying leases or lease (except to the extent the same may be made to pay or reimburse, or may be measured by, ad valorem taxes).
(l) Costs of Landlord's general corporate overhead and general administrative expenses, which would not be chargeable to Operating Expenses of the Building, determined in accordance with generally accepted accounting principles, consistently applied; and all costs related to maintaining Landlord's existence as a corporation, partnership or other entity.
(m) Any compensation paid to clerks, attendants or other persons in commercial concessions, if any, operated by Landlord or any affiliate of Landlord.
(n) All services for which Tenant (or any other tenant of the Building) specifically reimburses Landlord or for which Tenant pays directly to third persons.
(o) Costs incurred in installing, operating and maintaining any specialty not normally installed, operated, and maintained in buildings comparable to the Building, and not necessary, at Landlord's reasonable discretion, for the operation, repair, maintenance, and providing of required services for the Building, such as an antenna, broadcasting facilities (other than life support and security systems), luncheon club, athletic or recreational club, and costs incurred for sculpture, paintings or other art.
(p) Advertising and promotional expenses incurred to publicize the Building primarily for leasing purposes.
(q) Contributions to operating expense reserves.
(r) First-time costs of materials, spare parts, tools and equipment used in the operating, maintenance, cleaning, repair, landscaping and security of the Building, including the initial construction thereof.
(s) Premiums and other charges with respect to rental loss insurance.
(t) Contributions to charitable organization.
(u) Costs incurred in removing the property of former tenants and/or other occupants of the Building.
Tenant at its expense shall have the right at all reasonable times to inspect Landlord's books and records relating to the Lease and the Building for any year in which Operating Expense charges are due, any such inspection to be conducted at Landlord's office in ___________ Texas, during normal business hours; provided, however, Landlord agrees to reimburse Tenant for the cost of any such inspection conducted by or for it in the event the inspection proves that the Operating Expense charges charged to Tenant by Landlord hereunder for the period of time covered by such inspection shall have been overstated by ten percent (10%) or more. Any such inspection must cover a period within two (2) calendar years prior to the then current calendar year, any objections to charges prior thereto being conclusively presumed to have been waived.
3. Default by Landlord. Any provision in the Lease to the contrary notwithstanding, if Landlord fails to perform its obligations under the Lease and such failure (a) interferes substantially with the normal use of the Premises or appurtenant parking and/or other common areas by Tenant as allowed herein, and (b) continues for more than three (3) consecutive business days, then the rental shall be proportionately abated until such interference is eliminated or the Premises are otherwise rendered tenantable again. Additionally, if such interference continues for a period of 30 or more consecutive days, then Tenant shall have the right and option to cancel the Lease by giving written notice to Landlord within 15 days after the end of such 30 day period.
4. Tenant's Right to Perform Landlord's Obligations. Notwithstanding the provisions of Section _____ of the Lease, if Landlord defaults in the observance or performance of any term or covenant required to be performed by it under the Lease, Tenant after not less than 30 days notice to Landlord may, but shall not be obligated to, remedy such default and in connection therewith may pay or incur reasonable expenses. Notwithstanding the foregoing, Tenant shall not have such right in the event Landlord takes action to cure the default within such 30 day period but is unable, by reason of the nature of the work involved, to cure the same within such period, provided Landlord continues such work diligently and without unnecessary delays. Additionally, Tenant shall have the right to remedy any default of an emergency nature in the event Landlord fails to commence curing any default creating an emergency situation promptly upon being given notice which is reasonable under the circumstances, and Tenant shall have the right to remedy such a default without notice (if the giving of notice is not reasonably practicable) in the event of an emergency. All sums expended or obligations incurred by Tenant in connection with the foregoing shall be paid by Landlord to Tenant upon demand, and if Landlord fails to reimburse Tenant, Tenant may, in addition to any other right or remedy that Tenant may have, deduct such amount from subsequent installments of rent hereunder which from time to time thereafter become due to Landlord.
5. Restoration Following Casualty. Anything in Section _____ of the Lease to the contrary notwithstanding, if the damage to the Premises or the Building has not been repaired and the Premises made ready for occupancy within ____ days after the date of the damage or destruction, then the Tenant shall have the right and option to terminate this lease by giving written notice to Landlord at any time within 15 days after the end of such _____ day period. Additionally, if the damage is to such an extent that it cannot reasonably be repaired and the Premises made ready for occupancy within _____ days after the date of the damage or destruction, then Tenant may terminate this Lease within 30 days after the date of the damage or destruction by giving written notice to Landlord. Following any casualty loss which renders the Premises untenantable, Tenant shall be entitled to an abatement of rent from the date of the damage or destruction until the Premises are rendered tenantable notwithstanding any negligence on the part of Tenant. If only a portion of Premises is rendered untenantable, then Tenant's rent shall be partially abated taking into account the diminution in value of the Premises. If the lease is terminated, rent shall be prorated to the date of the damage or destruction and any prepaid rents or other prepaid amounts shall be refunded to Tenant.
6. Indemnification; Insurance. Anything in Section _____ of the Lease to the contrary notwithstanding, the indemnification by Tenant shall be only for claims by third parties and not for claims by Tenant. Additionally, Landlord shall indemnify and hold Tenant harmless from and against claims by third parties for any loss or damage to property or person to the extent caused by the acts or omissions of Landlord or its agents or employees. Landlord shall be responsible for obtaining and maintaining insurance covering the Building, and Tenant shall be responsible for insuring its fixtures and contents, against fire and other causes included in standard extended coverage by policies. Each party hereby releases and waives all claims, rights of recovery and causes of action against the other party, their officers, directors, employees, agents or invitees, or, in case of tenant, its subtenants, in connection with any loss or damage to the Premises, the Building, and personal property within the Building regardless of cause, including the negligence of Landlord or Tenant. Neither party, nor its officers, directors, employees, agents or invitees, nor, in case of tenant, its subtenants, shall be liable to the other for loss or damage to its respective property. Moreover, Landlord and Tenant shall be relieved of their respective obligations of indemnity to the extent of the amount actually recovered by Landlord or Tenant from one or more of the insurance carriers of Tenant or Landlord. The indemnities and releases set forth in the Lease as modified and supplemented by this paragraph 9 shall survive the expiration of the term of this Lease.
7. Notice of Tenant Default. Notwithstanding the provisions of Section _____ of the Lease, Tenant shall not be deemed to be in default until Tenant has received reasonable notice of such default. For purposes of this paragraph, "reasonable notice" shall be at least 5 days in the case of payment of rentals, and at least 30 days for all other events constituting a default. If Tenant cures such default within this notice period, then Landlord shall not be entitled to avail itself of the remedies described in Section _____ of the Lease. Additionally, Landlord shall not be entitled to exercise its rights under that Section _____ in the event Tenant takes action to cure a default within this notice period, but is unable, by reason of the nature of the work involved, to cure the same within such period, provided Tenant continues to work thereafter diligently and without unnecessary delays.
8. Subordination of Landlord's Lien. Landlord hereby subordinates all statutory and contractual landlord's liens (and, provided Tenant is not in default at the time, agrees to sign documents so indicating, upon Tenant's request) to any liens or security interests covering Tenant's inventory, or financed fixtures, furniture or equipment of Tenant in favor of bona-fide third-party lenders providing financing to Tenant (including purchase-money financing). Additionally, Tenant shall be permitted to remove contents from the Premises without Landlord's consent (free and clear of any landlord's liens) whenever Tenant has not previously received from Landlord a written notice of default which remains uncured.
9. Assignment and Subletting. Notwithstanding the provisions of Section _____ of the Lease, if Tenant requests Landlord's consent to an assignment of the Lease or subletting of all or a part of the Premises, Tenant shall submit to Landlord, in writing, the name of the proposed assignee or subtenant and the nature and character of the business of the proposed assignee or subtenant. Landlord's consent to an assignment or subletting shall not be required if the assignee or subtenant is (a) an "affiliate" (as defined below) of the Tenant, or (b) an entity which acquires all or substantially all the assets or outstanding stock of the Tenant through a merger or acquisition, and the assignee or subtenant agrees to be bound by the terms of the Lease. For purposes hereof, the term "affiliate" means any person or entity which now owns at least 51% voting control of the Tenant and any entity in which the Tenant or Tenant's current owners own at least 51% voting control. Additionally, a transfer of ownership interests in Tenant by reason of the death or divorce of an owner of Tenant shall not be deemed an assignment or subletting for purposes of the Lease. In situations where Landlord's consent is required, if Landlord has the option under the Lease to cancel the Lease (or the applicable portion thereof as to a partial subletting) and Landlord intends to elect to cancel the Lease, Landlord must give written notice of such election to Tenant, and Tenant shall have five (5) days after receipt of such notice in which to withdraw its request, thus precluding Landlord's right to cancel the Lease.
10. Non-Disturbance of Tenant. The subordination provided for in Section _____ of the Lease shall extend only to such mortgages or deeds of trust under which the mortgagee by agreement in the mortgage or deed of trust or in a separate instrument contracts in substance not to disturb Tenant's occupancy so long as Tenant performs its obligations in the Lease on condition that Tenant, when requested by the mortgagee, shall execute an attornment agreement to the mortgagee should the mortgagee succeed to the rights of the Landlord under the Lease.
11. Landlord's Approvals. Notwithstanding anything to the contrary contained in the Lease, it is specifically understood and agreed that as regards any approvals or matters to be performed to the satisfaction of Landlord, the Landlord shall not unreasonably withhold or delay its approval or indication of satisfaction and shall approve or be satisfied as to any matter so long as any deviation from the requirements of Landlord are of a minor and insubstantial nature such that Landlord will realize substantially the benefits to which it is entitled. Further, any matter required to be approved by Landlord hereunder which has been approved at any time shall be deemed approved for purposes hereof.
12. Telecommunications Equipment. Tenant is hereby granted (on a non-exclusive basis in conjunction with other tenants and subject to Landlord's approval) reasonable access to Building riser and chase space (but in no event more than Tenant's proportionate share of available space in the aggregate) and telecommunications areas for telecommunications equipment and cabling requirements in order to install and operate thereon microwave dishes/earth satellite disks and whip antennae (collectively, the "Rooftop Communications Equipment"), in locations as selected by the Tenant provided the same complies with all applicable governmental rules, regulations and codes. Without liability for Rental or any other charges, Tenant shall be permitted to select a contractor of its choice to undertake the installation of the Rooftop Communication Equipment, subject to Landlord's approval, which approval shall be based upon conforming with Building warranties and rules and regulations, but which shall not be unreasonably withheld or delayed. In addition, Tenant shall be permitted to construct equipment enclosures, if required, in locations, design and materials to be mutually agreed upon, for accommodation of the Rooftop Communications Equipment at no cost to Tenant during the Lease Term. Tenant shall also have the right to install necessary conduit and sleeving from the roof to the points of connection within the Premises. The Tenant shall be responsible for all costs of installation (including structural reinforcing, if required), repair and maintenance with respect to the Rooftop Communications Equipment. Further, Tenant shall have access to the incumbent local exchange carrier (ILEC) and shall have the right to access competitive local exchange carriers (CLECs) mutually agreed upon between Landlord and Tenant. All risers, chase space, telecommunications areas and associated telecommunications equipment and cabling shall be secured from access to the public. Tenant shall be responsible for payment to local exchange carriers for contracted charges within the Leased Premises. In addition, Landlord shall permit access to the Building, at the then prevailing rate for such access in comparable buildings of similar class and size in Houston, Texas, to a qualified telecommunication provider specified by Tenant and approved by Landlord (such approval not to be unreasonably withheld or delayed), and Landlord shall permit such provider to use the Building shafts, conduits, risers and other interfloor connections for the installation of cabling and other equipment.
13. Emergency Power and Other Facilities. Tenant shall have the right to install a freestanding generator, including storage tanks, UPS batteries and all other equipment necessary to facilitate such generator, at Tenant's cost, on the existing generator pad depicted on the attached Exhibit ____. The site upon which the generator is placed shall be at no cost to Tenant. The exact size and specifications of such generator shall be mutually agreed upon between Landlord and Tenant. During the Term, Tenant shall have the right to use Building shafts or conduits between the Premises and other parts of the Building (including the roof) for the installation and maintenance of conduits, cables, ducts, flues, pipes and other devised, supplementary HVAC and other facilities consistent with Tenant's use of the Premises and other portions of the Building. Furthermore, Tenant shall also have the right to use, in common with other tenants, the lobbies and other public areas of the Building, plus service elevator, loading dock, mail room and other Building facilities.
14. Compliance with Laws. Landlord and Tenant agree to comply with applicable laws, with their respective responsibilities to be allocated as follows:
(a) Tenant will be responsible for compliance with all applicable laws, statutes, ordinances and governmental rules, regulations or requirements now in force or that may hereafter be in force with respect to the operation of Tenant's business or the Premises, including, without limitation, any accommodations or alterations that need to be made within the Premises to accommodate disabled employees and customers of Tenant pursuant to requirements under the Americans With Disabilities Act [Public Law 101-336 (July 26, 1990)] and the Texas Architectural Barriers Act (Tex. Civ. Stat. Art. 9102) (collectively, the "Disability Statutes"). Any alterations made to the Premises in order to comply with any such statutes must be made solely at Tenant's expense and such alterations must also comply with the requirements of Section _____ of the Lease.
(b) Except for the obligations of Tenant under clause (a) above, Landlord shall be responsible for compliance with all applicable laws, statutes, ordinances and governmental rules, regulations or requirements now in force or which may be thereafter be in force that affect the Building, including without limitation, the Disability Statutes and local building or fire code requirements applicable to the Building. If Landlord is required to make any installation in the Building pursuant to the Disability Statues or local building or fire codes, the cost of such installation shall be a part of Operating Expenses if such installation constitutes a day-to-day operational expense. However, if such installation constitutes a capital improvement item under generally accepted accounting principles, such installation shall be accomplished at Landlord's sole cost and expense and shall not be charged to Tenant as a part of the Operating Expenses of the Building.
15. Certain Representations, Warranties and Agreements of Landlord. Landlord represents and warrants to Tenant as follows:
(a) To the best of Landlord's knowledge, the Building does not contain any material quantities of asbestos. To the best of Landlord's knowledge neither the Building nor the land on which it is located contain any substance deemed hazardous under federal, state, or local environmental statues, ordinances, rules, regulations, or orders ("Hazardous Materials"), other than negligible quantities of such Hazardous Materials as may typically be found in commercial construction or cleaning products used and disposed of in accordance with applicable laws. There are no underground storage tanks for petroleum products or Hazardous Materials, active or abandoned, located on the land on which the Building is located. There are no environmental liens on any of the real property comprising the Building. Landlord agrees not to cause or permit any Hazardous Materials to be produced, stored, kept, discharged, or released in or about the Building other than negligible quantities of such Hazardous Materials as may typically be found in commercial construction or cleaning products used and disposed of in accordance with applicable laws. Any provision in the Lease to the contrary notwithstanding, in no event shall Tenant be liable to Landlord for any Hazardous Materials stored, released or disposed of on the Premises prior to the commencement of the Lease by anyone other than the Tenant, or for any contamination due to Hazardous Materials in or about the Building which was not caused by Tenant.
(b) The Premises shall at all times during the term hereof have unobstructed access to the common areas of the Building, which in turn shall have access to public road(s) abutting the property on which the Building is located.
(c) The foundation, flooring and structural components of the Premises are sufficient to support loads common to Tenant's business.
(d) The HVAC system, elevators, electrical system, plumbing system, fire prevention system, roofs, foundations and all structural components of the Building are in good working order and conditions, are fit for their intended purposes, and, subject to the provisions of Section _____ of the Lease, will be maintained in good working order and condition by Landlord throughout the term of the Lease.
(e) Tenant will not be deemed to be a holdover tenant (and holdover rents will not apply) unless the Landlord is entitled to possession under the terms of the Lease and Tenant fails to vacate the Premises within 30 days after Tenant receives a written demand for possession from the Landlord.