HomeMy WebLinkAboutContract 56892 CSC No. 56892
TERMINATION OF OFFICE LEASE
This Termination of Office Lease (the "Termination") is entered into to be effective as of
December 15, 2021 ("Effective Date") between City of Fort Worth ("Landlord") and PAE Applied
Technologies LLC ("Tenant'), each individually referred to as a "parry" and collectively referred to as the
"parties."
RECITALS
WHEREAS Landlord, as successor-in-interest to Hertz Fort Worth Energy Way LP, and
Tenant are parties to an office lease dated August 5, 2019 regarding the lease of Suite 1500, consisting of
approximately 26,763 rentable square feet of space, (the "Premises") in Landlord's building located at
100 Energy Way, Fort Worth TX 76102 (the"Lease"); and
WHEREAS a copy of the Lease is attached hereto as Exhibit"A" and incorporated herein
for all purposes; and
WHEREAS the Lease provides for a term of approximately one hundred thirty-two (132)
full calendar months with a Commencement Date of October 1,2019 and an Expiration Date of September
30, 2030; and
WHEREAS Landlord and Tenant agree that an early termination of the Lease is in the best
interest of the parties and Landlord is willing to accept an early termination of the Lease in exchange for
the consideration and provisions contained herein; and
WHEREAS the termination of the Lease was approved by the Fort Worth City Council
on December 14, 2021 through Mayor and Council Communication No. 21-1002; and
WHEREAS Landlord and Tenant now wish to memorialize (i) the termination of the
Lease and (ii) the settlement of all claims of Tenant against Landlord relative to the Lease and Tenant's
occupancy of the Premises.
NOW,THEREFORE,in consideration of the mutual covenants herein contained and for
other good and valuable consideration,the receipt of which is hereby acknowledged,Landlord and Tenant
hereby agree as follows:
1. Recitals. The foregoing recitals are hereby affirmed by the parties as true and
correct and each such recital is incorporated herein by this reference. Unless otherwise defined herein,
capitalized terms used in this Termination shall have the meanings ascribed to such terms in the Lease.
2. Termination of Lease. Landlord and Tenant agree that the Expiration Date (as
defined in the Lease) shall be the earlier of(a)the date that Tenant surrenders possession of the Premises
to Landlord or (b) March 31, 2022, in each case, as contemplated by this Termination. Notwithstanding
the foregoing, Tenant shall use commercially reasonable efforts to surrender possession of the Premises
to Landlord by January 31, 2022. The Lease shall be terminated as of the Expiration Date and Tenant
Termination of Office Lease—100 Energy Way OFFICIAL RECORD
PAE Applied Technologies LLC
CITY SECRETARY
FT. WORTH, TX
agrees to surrender the Premises to Landlord by the Expiration Date in accordance with the terms of the
Lease, except as modified herein.
3. Consideration. For and in consideration of the recitals set forth above, the early
termination of the Lease, and other provisions contained herein, Tenant agrees to pay Landlord a total of
Seven Hundred Thirty-Five Thousand,Nine Hundred Eighty-Two and 50/100 Dollars ($735,982.50)
("Termination Consideration"). The Termination Consideration shall be delivered to Landlord by
December 17, 2021.
4. Rent. Tenant shall remain obligated to pay all Rent (including Base Rent and
Additional Rent) due under the Lease until and through the Expiration Date in accordance with the terms
of the Lease, which amounts shall be prorated or refunded as applicable.
5. Furnishings and Equipment; Surrender. For and in consideration of the recitals set
forth above, the early termination of the Lease, and other provisions contained herein, the existing
furnishings and information technology equipment that are located within the Premises as of the
Expiration Date shall be conveyed from Tenant to Landlord as Landlord's personal property. Tenant
warrants that it has the right to convey such furnishings and equipment to Landlord. Certain items that
will not be conveyed from Tenant to Landlord are included on Exhibit "B," incorporated herein for all
purposes; provided, however, that any such items must be removed from the Premises by the Expiration
Date. Subject to the foregoing and unless otherwise mutually agreed to in writing between the parties,
Tenant's sole obligation upon surrender of the Premises to Landlord shall be to deliver the Premises in
broom clean condition to Landlord on the Expiration Date.
6. Governmental Powers. It is understood and agreed that by execution of this
Termination, Landlord does not waive or surrender any of its governmental powers or immunities.
7. Governing Law and Venue. This Termination will be construed in accordance
with the laws of the State of Texas. If any action, whether real or asserted, at law or in equity, is brought
pursuant to the Lease or this Termination,venue for such action will lie in state courts located in Tarrant
County,Texas or the United States District Court for the Northern District of Texas, Fort Worth Division.
8. Severability. If any provision of this Termination is held to be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining provisions will not in any way be
affected or impaired.
9. Signature Authority. The person signing this Termination hereby warrants that
they have the legal authority to execute this Termination on behalf of the respective party, and that such
binding authority has been granted by proper order, resolution, ordinance or other authorization of the
entity. This Termination may be executed by any authorized representative of Tenant. Each party is fully
entitled to rely on these warranties and representations in entering into this Termination.
10. Electronic Signatures. This Termination may be executed by electronic signature,
which will be considered as an original signature for all purposes and have the same force and effect as
Termination of Office Lease—100 Energy Way
PAE Applied Technologies LLC
an original signature. For these purposes, "electronic signature" means electronically scanned and
transmitted versions (e.g. via pdf file or facsimile transmission) of an original signature, or signatures
electronically inserted via software such as Adobe Sign.
[signature page follows]
Termination of Office Lease—100 Energy Way
PAE Applied Technologies LLC
IN WITNESS WHEREOF,the parties hereto have executed this Termination in multiples.
LANDLORD:
CITY OF FORT WORTH CONTRACT COMPLIANCE MANAGER:
By signing I acknowledge that I am the person
b"W-L5=L� responsible for the monitoring and administration
By: Dana Burghdoff( c 27,20 09:25 CST) of this contract, including ensuring all performance
Name: Dana Burghdoff and reporting requirements.
Title: Assistant City Manager
Date: 92021
By:
APPROVAL RECOMMENDED: Name: Greg Wingate
Title: Sr. Facility Planner, Property Management
Department
By. Steve o06e(Dec 21,202114:14 CST) APPROVED AS TO FORM AND LEGALITY:
Name: Steve Cooke
Title: Director, Property Management Department
ATTEST: By:
Name: Matthew A.Murray
Title: Assistant City Attorney
By: ette S.Goodall(Dec 28,2021 07 CST) CONTRACT AUTHORIZATION:
Name: annette Goodall g044UUn�� M&C: 21-1002; December 14,2021
od FORT
Title: City Secretary ��F°° °°.0a' Form 1295: 2021-831909
v°�o 09�0,
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TENANT: n nEXASob
PAE APPLIED TECHN OGIES LLC
By:
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Name: Derek M Johns
Title: SR.DIRECTOR,GSCM
Date: 16 Dec 2021
OFFICIAL RECORD
Termination of Office Lease—100 Energy Way
PAE Applied Technologies LLC CITY SECRETARY
FT. WORTH, TX
Exhibit A
The Lease
Termination of Office Lease—100 Energy Way
PAE Applied Technologies LLC
11 d
H E R T Z
I N V E S T M E N T
G R O U P
OFFICE LEASE
HERTZ FORT WORTH ENERGY WAY, LP
("Landlord")
PAE APPLIED TECHNOLOGIEs LLC, ("Tenant")
PIER 1 IMPORTS BUILDING
SUITE #1500
TABLE OF CONTENTS
1. BASIC LEASE PROVISIONS.............................................................:.......................................................1
2. PROJECT......................................................................................................................................................4
3. TERM.............................................................................................................................................................5
4. RENT............................................................................................................................................................10
5. USE&OCCUPANCY................................................................................................................................13
6. SERVICES&UTILITIES.........................................................................................................................14
7. REPAIRS.....................................................................................................................................................17
8. ALTERATIONS..........................................................................................................................................18
4. INSURANCE...............................................................................................................................................19
10. DAMAGE OR DESTRUCTION................................................................................................................21
11. INDEMNITY...............................................................................................................................................22
12. CONDEMNATION.....................................................................................................................................23
13. 'TENANT TRANSFERS..............................................................................................................................23
14. LANDLORD TRANSFERS.......................................................................................................................25
15. DEFAULT AND REMEDIES....................................................................................................................26
16. SECURITY DEPOSIT................................................................................................................................31
17. MISCELLANEOUS....................................................................................................................................31
EXHIBIT A-FLOOR PLAN DELINEATING THE PREMISES....................................................................A-1
EXHIBIT B-WORK LETTER............................................................................................................................B-1
EXHIBIT C-NOTICE OF LEASE TERM..........................................................................................................C-1
EXHIBIT D-RULES®ULATIONS...........................................................................................................D-1
EXHIBIT E-PARKING........................................................................................................................................E-1
EXHIBITF-SNDA....................................................................................................................................................3
EXHIBIT G-ANTENNA RIGHTS.................................................................................................................G-1
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PIER I IMPORTS BUILDING OFFICE LEASE
PAEIDWD 1ST DRAFT 6-10-14 SUITE 1500
INDEX OF DEFINED TERMS
Additional Insured 13 Mandated Expenses 6
Additional Rent 6 Maximum Connected Load to
Affiliates 16 Mechanical Systems 3
Alterations 11 NLT 5
Alterations Fee 13 Notice Addresses 2
Amortization Rate 7 Parking Allotment 3
Base Building 3 Parking Facilities 3
Base Rent l Parking Rules and Regulations E-1
Base Year I Patron E-1
Billing Address 2 Permitted Transferee 17
Brokers 2 Premises 1
Building I Project 3
Building Standard 4 Quality Expenses 7
Building Structure 3 Reasonable attorneys' fees 233
Business Hours 3 Reletting Expenses 23
Claims 16 Remainder Rent 23
Commencement Date 4 Rent 8
Common Areas 3 Repair Estimate 15
Comparison Year 6 Replacement Premises 25
Construction Allowance 3 Repossession Expenses 24
control 17 Required Removable 12
Cost-Saving Expenses 6 RSF I
Default 20 Rules and Regulations 0-1
Default Rate 24 Scheduled Commencement Date 1
Design Problem 12 Security Deposit 2
Encumbrance 19 Standard Services 9
Enforcement Costs 23 Successor Landlord 19
Estimated Additional Rent 8 Taking 16
Excess Expenses 6 Taxes 6
Excess Taxes 6 Telecommunication Services 10
Execution Hate I Tenant 1
Expenses 6 Tenant's Personal Property 4
Expiration Date 1 Tenant's Share I
Fair Market Rent 23 Tenant's Wiring 1 I
Force Majeure 24 Term I
Guaranteed Obligations F-1 Transfer 17
Guarantor F-1 Unamortized Landlord Costs 23
Guaranty F-1 Untenantable 15
Hazardous Materials 9 Use I
Holdover 5 Vehicle E-1
Holidays 3 Work Letter 3
HVAC 9
Interruption Estimate 15
Land 3
Landlord 1
Landlord Costs 23
Landlord's Damages 23
Late Charge 8
Laws 9
Lease 1
Leasehold Improvements 4
Liability Limit 3
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PIER l IMPORTS BUILDING OFFICE LEASE
PAEJDWD lsT DRAFT 6-10-19 SUITE 1500
OFFICE LEASE
Landlord and Tenant enter this Office Lease ("Lease") as of the Execution Date on the following terms,
covenants,conditions and provisions:
1. BASIC LEASE PROVISIONS
1.1 Basic Lease Definitions.In this Lease,the following defined terms have the meanings indicated.
(a) Execution Date: means the Lease is fully executed as of &$1.1i j4L ,2019.
(b) Landlord: Hertz Fort Worth Energy Way,LP,a Delaware limited partnership.
(c) Tenant: PAE Applied Technologies LLC, a Delaware Limited Liability
Company, having a principal place of business at 7799 Leesburg Pike,
Falls Church,Virginia 22043
(d) Building: Pier I Imports Building located at 100 Energy Way, Fort Worth, TX
76102 and deemed to contain approximately 409,977 rentable square
feet("RSF").
(e) Premises: Suite#1500 (identified on Exhibit A), comprising the entire 15th floor
of the Building and deemed to contain approximately 26,763 RSF. The
measurement utilized to define the RSF is BOMA Z65.1.
(f7 Use: Tenant shall have the right to use the Premises for any and all uses
permitted by law, current restrictions of record and applicable zoning
ordinances,including,without limitation,general office use and training
and customer demonstration lab.
(g) Term: means the duration of this Lease, which will be approximately one hun-
dred thirty two(132)full calendar months,beginning on the Commence-
ment Date(as defined in§3.1 below)and ending on the Expiration Date
(as defined below),unless terminated earlier or extended further as pro-
vided in this Lease.The"Expiration Date"means(i)if the Commence-
ment Date is the first day of a month,the 1321 monthly anniversary of
the day immediately preceding the Commencement Date; or (ii) if the
Commencement Date is not the first day of a month,the 132"d monthly
anniversary of the last day of the full calendar month in which the Com-
mencement Date occurs.
(h) ScheduIed Commencement The Commencement Date shall occur on the earlier to occur of(i)the
Date: date of substantial completion by Tenant of the Tenant Improvements
pursuant to Exhibit B hereof, and Tenant's beneficial use(i.e. open for
business)of the Premises which is estimated to occur on October 1,2019,
or(b)January 1,2020.
0) Base Rent"*: The following amounts payable in accordance with Article 4:
Lease Months Annual Rate per RSF Monthly Base Rent
1-4* $0.00* $0.00*
5-12 $25.00 $55,756.25
13-24 $25.00 $55,756.25
25-36 $26.00 $57,986.50
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PIER 1 IMPORTS BUILDING OFFICE LEASE
PAEIDWD FIT DRAFT 6-10-19 SUITE 1500
37-48 $27.00 $60,216.75
49-60 $27.00 $60,216.75
61-72 $29.50 $65,792.37
73-84 $29.50 $65,792.37
85-96 $29.50 $65,792,37
97-108 $30.50 $68,022.63
109-120 $30.50 $68,022.63
121-132 $30.50 $68022.63
* So long as Tenant is not in default under any of the terms,covenants or conditions of the Lease
following notice and expiration of the applicable default cure period(s)provided for in Section 15
of the Lease,Base Rent only shall be abated on a month-to-month basis during this four(4)month
period. If the foregoing abatement is not applicable due to a default by Tenant as aforesaid,Base
Rent shall be payable for any period during which Tenant is in default as aforesaid at a rate of
$55,756.25 per month.Tenant shall be provided the value of any rental abatement lost upon curing
the default.
**The foregoing amounts are subject to increase to reflect any Amortized Allowance provided to
Tenant pursuant to Exhibit B of this Lease.
There will absolutely no rental obligations(Base Rent,electricity or Additional Rent) for Tenant
prior to October 1,2019.
(j) Tenant's Share: 6.53%.
(k) Base Year: The calendar year 2020.
(1) Security Deposit: None.
(m) Notice Address: For each party,the following address(es):
To Landlord To Tenant
Building Address Before the Commencement Date:
For all requests pursuant to §17.2(a) PAE t00 Energy Way,Suite 100 -GSM
779
Fort Worth,TX 76102 799 Leesburg Pike
Attention:Property Manager Falls Church,VA 22043
Email:propertymanager@Pierl.hertzgroup.com
Notice Address After the Commencement Date:
For all notices required under the Lease
pursuant to§17.2(b):
1522 2"d Street PAID-GSM
Santa Monica,CA 90401
Attn:Asset Manager 7799 Leesburg Pike
Email: assetmanager@Pierl.hertzgroup.com Falls Church,VA 22043
With copy to digital address.,
With a copy to:
100 Energy Way, Suite 100 marlton-ap@pae.com
Fort Worth,TX 76102
Attention:Property Manager
Email: roe mana er Pierl.hertz rou .com
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PIER I IMPORTS BUILDING OFFICE LEASE
PAE/DWD IST DRAFT 6-10-19 SUITE 1500
(m) Billing Address: For each party,the following address:
For Landlord for the payment of Rent For Tenant
US Mail
Hertz Fort Worth Energy Way,LP PAE-GSM
PO Box 207633 7799 Leesburg Pike
Dallas,TX 75320-7633 Falls Church,VA 22043
Overnight Courier With copy to digital address:
LOCKBOX SERVICES 207633
Hertz Fort Worth Energy Way,LP marlton-ap@pae.com
2975 Regent Blvd
Irving,TX 75063
ACH or Wire
Wells Fargo Bank
ARA#121000248
Account#4370552556
Account Name: Hertz Fort Worth Energy Way,
LP
(n) Brokers: ILL (Pat McDowell) (for Landlord) and ILL (Frank Taylor) (for
Tenant).Brokers will be paid by Landlord in accordance with a separate
agreement.
(o) Parking Allotment: Tenant shall have four (4) unreserved parking spaces for each 1,000
RSF of space within the Premises at no cost to Tenant during the Term
(including extensions). Such parking spaces shall be in locations
determined by Landlord.Tenant shall have the right to convert up to ten
percent(10%) of Tenant's parking spaces to reserved parking spaces,
at a rate of Fifty Dollars($50.00)per reserved parking space;provided,
ten(10)reserved spaces shall be at no cost to Tenant during the Term.
Parking shall be in the Building Parking Garage and/or surface lots
immediately adjacent to the Building("Parking Facilities") pursuant
to the terms set forth in Exhibit E.
(p) Liability Limit: $3,000,000.00 for any one accident or occurrence.
(q) Business Hours: From 7:00 a.m.to 6:00 p.m.on Monday through Friday and from 7:00
a.m.to 1:00 p.m.Saturday,excepting:New Year's Day,Memorial Day,
Independence Day,Labor Day,Thanksgiving Day,Christmas Day,and
other legal holidays commonly observed in similar class office
buildings in the locale of the Building("Holidays").Each Holiday will
be observed on the applicable date observed by the United States
government.
(r) Construction Eight Hundred Sixty Nine Thousand Seven Hundred Ninety Seven and
Allowance: 50/100 Dollars($869,797.50) (or$32.50 multiplied by the RSF of the
Premises)per the terms of Exhibit B,("Work Letter").
See Exhibit B re:Amortized Allowance and Test Fit Allowance.
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PIER I IMPORTS BUILDING OFFICE LEASE
PAElDWD IsT DRAFT 0-10-19 SUITE 1500
2. PROJECT
2.1 Project.The Land,Building and Common Areas(as each may be defined in Article I and below)
are collectively referred to as the"Project".
2.2 Land. "Land" means the real property on which the Building and Common Areas are located,
including easements and other rights that benefit or encumber the real property, in the City of Fort Worth, State of
Texas. Landlord's interest in the Land may be in fee or leasehold. The Land may be expanded or reduced after the
Execution Date.
2.3 Base Building. `Base Building"means Building Structure and Mechanical Systems,collectively,
defined as follows:
(a) Building Structure. "Building Structure" means the structural components in the Building,
including foundations, floor and ceiling slabs, roofs, exterior walls, exterior glass and mullions,
columns,beams, shafts,and emergency stairwells.The Building Structure excludes the Leasehold
Improvements(and similar improvements to other premises)and the Mechanical Systems.
(b) Mechanical Systems. "Mechanical Systems" means the mechanical, electronic, physical or
informational systems generally serving the Building or Common Areas, including the sprinkler,
plumbing, heating, ventilating, air conditioning, lighting, communications, security, drainage,
sewage, waste disposal, vertical transportation, and firellife safety systems, but excluding the
Leasehold Improvements(and similar improvements to other premises).
2.4 Common Areas.Tenant will have a non-exclusive right to use the Common Areas subject to the
terms of this Lease."Common Areas"means those interior and exterior common and public areas on the Land(and
appurtenant easements)and in the Building designated by Landlord for the non-exclusive use by Tenant in common
with Landlord, other tenants and occupants, and their employees, agents and invitees. The Common Areas include
those portions of the Project that are necessary for the operation of the Building or are provided for the non-exclusive
use by Tenant in common with Landlord and other tenants and occupants,and their employees, agents and invitees,
of the Building.The Common Areas include the Parking Facilities serving the Building that are owned or leased by
Landlord.To the extent the Building features a fitness center,use of such fitness center shall be at no cost to Tenant
or Tenant's onsitc employees. Landlord shall use commercially reasonable efforts to provide a fitness center and an
on-site cafeteria during the Term.
2.5 Premises. Landlord leases to Tenant the Premises subject to the terms of this Lease. Except as
provided elsewhere in this Lease,including any work to be performed by Landlord as set forth in Exhibit B("Work
Letter"), if any, by taking possession of the Premises,Tenant accepts the Premises in its"as is"condition and with
all faults,yet the Premises are deemed to be in good order,condition,and repair.The Premises include the Leasehold
Improvements as defined in subsection (a) below, but exclude certain areas, facilities and systems as set forth in
subsection(b)below:
(a) Leasehold Improvements. "Leasehold Improvements" mean all non-structural improvements in
the Premises or exclusively serving the Premises,and any structural improvements to the Building
made to accommodate Tenant's particular use of the Premises.The Leasehold Improvements may
exist in the Premises as of the Execution Date, or be installed by Landlord or Tenant under this
Lease at the cost of either party, including,but not limited to any Alterations installed pursuant to
§8 and the Tenant Improvements set forth in the attached Exhibit B.The Leasehold Improvements
include:(1)interior walls and partitions(including those surrounding structural columns entirely or
partly within the Premises); (2) the interior one-half of walls that separate the Premises from
adjacent areas designated for leasing;(3)the interior drywall on exterior structural walls,and walls
that separate the Premises from the Common Areas; (4)stairways and stairwells connecting parts
of the Premises an different floors, except those required for emergency exiting; (5) the frames,
casements,doors,windows and openings installed in or on the improvements described in(1-4),or
that provide entry/exit to/from the Premises;(6)all hardware,fixtures,cabinetry,railings,paneling,
woodwork and finishes in the Premises or that are installed in or on the improvements described in
(1-5); (7) if any part of the Premises is on the ground floor, the ground floor exterior windows
(including mullions, frames and glass); (8) integrated ceiling systems (including grid, panels and
lighting);(9)carpeting and other floor finishes;(10)kitchen,rest room,hot water heater,laboratory
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PIER l IMPORTS BUILDING OFFICE LEASE
PAEIDWD 1�"DRAFT6-10-19 SUITE 1500
or other similar facilities that exclusively serve the Premises (including plumbing fixtures,toilets,
sinks and built-in appliances); and (11) the sprinkler, plumbing, heating, ventilating, air
conditioning, lighting, communications, security, drainage, sewage, waste disposal, vertical
transportation, firellife safety, and other mechanical,electronic,physical or informational systems
that exclusively serve the Premises, including the parts of each system that are connected to the
Mechanical Systems from the common point of distribution for each system to and throughout the
Premises.
(b) Exclusions from the Premises. Except as specifically agreed to by Landlord in writing in its sole
discretion,the Premises do not include.(1)any areas above the finished ceiling, integrated ceiling
systems, or if the ceiling is open concept, above the underside of the overhead slab, or below the
finished floor coverings that are not part of the Leasehold Improvements,(2)janitor's closets, (3)
stairways and stairwells to be used for emergency exiting or as Common Areas, (4) rooms for
Mechanical Systems or connection of telecommunication equipment, (5) vertical transportation
shafts,(6)vertical or horizontal shafts,risers,chases,flues or ducts,and(7)any easements or rights
to natural light,air or view.
(c) Full floor Premises. Because the Premises include one or more floors in their entirety,all corridors
and restroom facilities located on such full floor(s) shall be considered part of the Premises.
Landlord shall still maintain ADA compliance obligations in the restrooms on the floor.
(d) Existing Furnishings. As and for partial consideration for this Lease, the existing furnishings
("Existing Furnishings")that are located within the Premises as of the Execution Date are hereby
conveyed to Tenant as Tenant's Personal Property Tenant has inspected the Existing Furnishings
and accepts same in their as-is, where-is condition as of the Execution Date. Landlord makes
absolutely no representations or warranties, whether express, implied or implied by law,regarding
the Existing Furnishings,including without limitation any representation regarding the condition of
the Existing Furnishings,their suitability for Tenant's use, or the merchantability thereof. Tenant
hereby waives and releases Landlord from any and all claims,known or unknown,arising out of or
related to the Existing Furnishings. Landlord warrants that it has the right to convey such
furnishings to Tenant.
(e) Building Conference Room, The conference room serving the Building is located within that portion
of the Building that is leased and occupied by Pier 1. If Tenant desires to use the Pier 1 conference
room, it shall be the responsibility of Tenant to make arrangements directly with Pier 1.
(f) Antenna Rights. See Exhibit F.
2.6 Building Standard."Building Standard"means the minimum or exclusive type,brand,quality or
quantity of materials Landlord designates for use in the Building from time to time.
2.7 Tenant's Personal Property. "Tenant's Personal Property" means those trade fixtures,
furnishings, equipment, work product, inventory, stock-in-trade and other personal property of Tenant that are not
permanently affixed to the Project in a way that they become a part of the Project and will not,if removed,impair the
value of the Leasehold Improvements that Tenant is required to deliver to Landlord at the end of the Term under§3.3.
3. TERM
3.1 Commencement Date."Commencement Date" means the first day of the Term,which will be the
earlier of(i) the first day on which Tenant occupies the Premises for the regular conduct of its business; or(ii)the
Scheduled Commencement Date(as the same may be extended according to§3.1(b)below).
(a) Delivery.The Premises are currently occupied by Pier 1.Landlord shall use commercially reasona-
ble efforts to terminate the Pier 1 lease with respect to the Premises and use commercially reasonable
efforts to deliver the Premises to Tenant for Tenant's performance of the Tenant Improvements on
or about July 15,2019.Space will be delivered broom clean condition.
(b) Delayed Occupancy. If Landlord fails to tender possession of the Premises to Tenant by the Sched-
uled Commencement Date due to delay caused by Tenant, Force Majeure or due to the holdover or
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PIER I IMPORTS BUILDING OFFICE LEASE
PAEIDWD Is"DRAFT6-10-19 SUITS:1Soo
unlawful possession of the Premises by another party,Landlord will not be in default of this Lease;
provided, however, that the Commencement Date will be extended automatically by one day for
each day of the period after the Scheduled Commencement Date to the day on which Landlord
tenders possession of the Premises to Tenant less any portion of that period attributable to Tenant's
Delays as more particularly described in Exhibit B;and if the Premises are not delivered by August
1, 2019,Tenant's sole remedy shall be to terminate this Lease by providing Landlord with fifteen
(15)days' prior written notice which must be received by Landlord no later than August 10,2019,
provided,if the Premises are delivered to Tenant within fifteen(15)days after Landlord's receipt of
such termination notice,Tenant's termination shall be null and void and of no force or effect, and
this Lease shall continue in full force and effect in accordance with its terms.
(c) Confirmation of Term. Landlord shall notify Tenant of the Commencement Date using a Notice of
Lease Term ("NLT") in the form attached to this Lease as Exhibit C. Tenant shall execute and
deliver to Landlord the NLT within 10 business days after its receipt. Tenant's failure to execute
and return the NLT,or to provide written objection to the statements contained in the letter,within
thirty(30) days after the date of"Tenant's receipt of the NLT shall be a default and shall otherwise
be deemed an approval by Tenant of the statements contained therein,but Tenant's failure to do so
will not reduce Tenant's obligations or Landlord's rights under this Lease.
3.2 Holdover.Tenant understands that it does not have the right to remain in the Premises following
the Expiration Date or earlier termination of this Lease("Holdover")at any time and Landlord may exercise any and
all remedies at law or in equity to recover possession of the Premises.No Holdover by Tenant shall be deemed to be
consented to by Landlord unless such consent is in writing. Landlord may withhold its consent to any holdover in
Landlord's sole discretion. For any Holdover with Landlord's prior written consent, Tenant will be deemed to be a
tenant from month to month, at a monthly Base Rent, payable in advance, equal to the monthly Base Rent payable
during the last year of the Term,and Tenant will be bound by all of the other terms,covenants and agreements of this
Lease as the same may apply to a month-to-month tenancy. If Tenant holds over after the Expiration Date without
Landlord's prior written consent, Tenant will be deemed a tenant at sufferance, at a daily Base Rent, payable in
advance, equal to one hundred twenty-five percent(125%) for the first month and hundred fifty percent(150%)of
the Base Rent per day payable during the last year of the Term after the first month,and Tenant will be bound by all
of the other terms,covenants and agreements of this Lease as the same may apply to a tenancy at sufferance.If such
Holdover without Landlord's consent continues for more than thirty (30) days after receipt of Landlord's written
demand to vacate the Premises, then Tenant shall indemnify and defend Landlord from and against all claims and
damages, both consequential and direct, that Landlord suffers due to Tenant's failure to return possession of the
Premises to Landlord at the end of the Term.Landlord's deposit of Tenant's Base Rent payment during any Holdover
will not constitute Landlord's consent to a Holdover,or create or renew any tenancy.
3.3 Condition on Expiration.
(a) Return of the Premises. At the end of the Term, Tenant will return possession of the
Premises to Landlord vacant, free of Tenant's Personal Property and any Required
Removables (as defined in §8.1), in broom-clean condition, and with all Leasehold
Improvements in good working order and repair(excepting ordinary wear and tear).
(b) Correction by Landlord.If Tenant fails to return possession of the Premises to Landlord in
the condition required under(a),then Tenant shall reimburse Landlord for the reasonable
costs incurred by Landlord to put the Premises in the condition required under (a), plus
Landlord's standard administration fee.
(c) Abandoned Property.Tenant's Personal Property left behind in the Premises after the end
of the Term will be considered abandoned.Landlord may move,store,retain or dispose of
these items at Tenant's expense,plus Landlord's standard administration fee.At Landlord's
option, any abandoned Tenant's Personal Property will become Landlord's property
automatically without compensation to Tenant.
3.4 Options to Extend Term.
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3.4.1 Grant; Conditions. Tenant shall have the right to extend the Term of the Lease
("Extension Option")for two(2)periods of five(5)years each(each,an"Extension Term")upon all of the following
conditions:
(a) Tenant shall exercise this Extension Option by written notice ("Extension Notice") to
Landlord which must be received by Landlord not later than 5:00 p.m. on the date three
hundred sixty five(365)days prior to the then applicable Expiration Date, but not earlier
than eighteen(18)months prior to the then-applicable Expiration Date;and
(b) Tenant is not in default under the Lease beyond any applicable cure periods at the time that
Tenant delivers its Extension Notice or at the time Tenant delivers its Binding Notice(as
defined below);and
(c) Not more than 50%of the Premises is sublet(other than pursuant to a Permitted Transferee,
as defined in §13.02 of the Lease)at the time that Tenant delivers its Extension Notice or
at the time Tenant delivers its Binding Notice;and
(d) The Lease has not been assigned(other than pursuant to a Permitted Transferee,as defined
in§13.02 of the Lease)prior to the date that Tenant delivers its Extension Notice or prior
to the date Tenant delivers its Binding Notice.
3.4.2 'Perms Applicable to Premises During Extension Term.
(a) The initial Base Rent rate per rentable square foot for the Premises during the applicable
Extension Term shall equal the Market Rent rate(as defined below) per rentable square
foot for the Premises. Base Rent during the Extension Term shall increase, if at all, in
accordance with the increases assumed in the determination of the Market Rent rate. Base
Rent attributable to the Premises shall be payable in monthly installments in accordance
with the terms and conditions of the Lease.
(b) Tenant shall pay Additional Rent (i.e. Taxes and Expenses) for the Premises during the
applicable Extension Term in accordance with the Lease and Base Year as defined during
any extension, and the manner and method in which Tenant reimburses Landlord for
Tenant's Share of Taxes and Expenses shall otherwise be a factor considered in the
determination of the Market Rent rate for the Premises during the applicable Extension
Term.
(c) All other terms of this Lease, except this Extension Option and any Landlord's work or
allowances,if any,shall apply during the applicable Extension Term.
3.4.3 Procedure for Determining Market Rent.
(a) Within thirty (30) days after Landlord's receipt of the Extension Notice, Landlord shall
compute the Market Rent rate(as defined below)and shall notify Tenant in writing of the
resulting amount("Determination Notice").
(b) Tenant, within fifteen (15)days after Tenant's receipt of the Determination Notice, shall
either(i)give Landlord written notice("Binding Notice")that Tenant accepts the Base and
Additional Rent rate for the Premises for the Extension Term described in the
Determination Notice,in which event the parties shall enter into the Extension Amendment
as described below, or (ii)if Tenant disagrees with Landlord's determination of the
applicable Base and Additional Rent rate for the Premises during the applicable Extension
Term, provide Landlord with written notice of rejection (the "Rejection Notice"). If
Tenant fails to provide Landlord with either a Binding Notice or Rejection Notice within
such fifteen(15)day period,this Extension Option shall be null and void and of no further
force and effect.
(c) If Tenant provides Landlord with a Rejection Notice, Landlord and Tenant shall work
together in good faith to agree upon the Market Rent rate for the Premises during the
applicable Extension Term. When Landlord and Tenant have agreed upon the Market Rent
rate for the Premises, such agreement shall be reflected in a written agreement between
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Landlord and Tenant,whether in a letter or otherwise(and such shall be deemed a Binding
Notice, for purposes herein), and Landlord and Tenant shall enter into the Extension
Amendment in accordance with the terms and conditions hereof.
(d) If Landlord and Tenant are unable to agree upon Market Rent for the Premises within thirty
(30) days after Landlord's receipt of the Rejection Notice, Tenant, by written notice
("Arbitration Notice") received by Landlord within five(5) days after the expiration of
such thirty (30) day period, shall have the right to have such Market Rent determined in
accordance with the arbitration procedures described below. If Tenant fails to timely
exercise its right to arbitrate,this Extension Option shall be deemed to be null and void and
of no further force and effect.
(e) Arbitration Procedure.
W If Tenant provides Landlord with an Arbitration Notice, then Landlord and
Tenant, within five (5) days of Landlord's receipt of the Arbitration Notice, shall each
simultaneously submit to the other, in a sealed envelope, its good faith estimate of the
Market Rent rate for the Premises during the applicable Extension Term (collectively
referred to as the "Estimates"). If the higher of such Estimates is not more than 105%of
the lower of such Estimates, then the Market Rent rate shall be the average of the two
Estimates. If the Market Rent rate is not resolved by the exchange of Estimates, then,
within fifteen(15) days after the exchange of Estimates, Landlord and Tenant shall each
select an arbitrator to determine which of the two Estimates most closely reflects the
Market Rent rate for the Premises during the applicable Extension Term. Each arbitrator
so selected shall he an independent, disinterested real estate broker with at least ten(10)
years' continuous experience in the business of procuring office leases in the Houston,
Texas office space sub market in which the Building is located("Comparable Market")
and who shall be knowledgeable in rental rates and lease transactions in the Building.
(ii) Upon selection, Landlord's and Tenant's arbitrators shall work together in good
faith to agree upon which of the two Estimates most closely reflects the Market Rent rate
for the Premises during the applicable Extension Term. The Estimate chosen by such
arbitrators shall be binding on both Landlord and Tenant as the Market Rent rate for the
Premises during the applicable Extension Term. If either Landlord or Tenant fails to
appoint an arbitrator within the fifteen (15) day period referred to above, the arbitrator
appointed by the other party shall be the sole arbitrator for the purposes hereof. If the two
arbitrators cannot agree upon which of the two Estimates most closely reflects the Market
Rent rate within twenty(20)days after their appointment,then, within ten(10)days after
the expiration of such twenty (20) day period, the two arbitrators shall select a third
arbitrator meeting the aforementioned criteria. Once the third arbitrator has been selected
as provided for above,then,as soon thereafter as practicable but in any case within fourteen
(14)days,such arbitrator shall make his or her determination of which of the two Estimates
most closely reflects the Market Rent rate and such Estimate shall be binding on both
Landlord and Tenant as the Base and Additional Rent rate for the Premises during the
applicable Extension Term, and the parties shall enter into the Extension Amendment as
described below. If the arbitrator believes that expert advice would materially assist him
or her,he or she may retain one or more qualified persons to provide such expert advice.
The parties shall share equally in the costs of the arbitrator and of any experts retained by
the arbitrator. Any fees of any arbitrator,counsel or experts engaged directly by Landlord
or Tenant,however,shall be borne by the party retaining such arbitrator,counsel or expert.
(iii) If the decision of the arbitrators regarding the Market Rent rate shall not be made
prior to the effective date for Base Rent during the applicable Extension Term,then Tenant
shall pay Base and Additional Rent at the rate or rates in effect as of the end of the Initial
Term or preceding Extended Term,if applicable,subject to adjustments once the Base Rent
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is determined by the arbitrators.A determination of the Market Rent rate by the arbitrators
shall be binding on the parties and Base Rents shall be paid in accordance with this Lease.
(f) "Market Rent" for the applicable Extension Term shall mean the market annual Base Rent
for the Premises,based on renewing tenancies(for a term comparable to the time period in
question) covering office space of comparable size and quality to the Premises in
comparable buildings in comparable location in the Comparable Market, including the
Building, and the rent for which such renewal tenancy was determined and commenced
within twelve(12)months before the Determination Date,taking into account all pertinent
factors including but not limited to Tenant's credit worthiness, the involvement or non-
involvement of a broker, that Tenant may not require an improvement allowance, rental
abatement or other concessions,if any,typical to a new tenant and assuming Landlord and
Tenant to be prudent persons willing to lease but being under no compulsion to do so. By
the above reference to the absence of a compulsion to enter into a renewal tenancy,
Landlord and Tenant do not intend to exclude renewal tenancies arising out of a tenant's
exercise of a fixed option to extend its lease term.
(g) Time is of the essence of this Extension Option. This Extension Option shall be void if
Tenant fails to exercise it precisely according to each and all of the conditions stated above.
3.5 Tenant Termination Option.Tenant shall have the one-time-only option to terminate this Lease
("Termination Option")as of the last day of the eighty-seventh(871)full calendar month following
the Commencement Date ("Termination Date") upon the conditions stated below. This
Termination Option shall be void unless exercised precisely according to these conditions:
(a) Tenant shall exercise this Termination Option by written notice("Termination Notice");
such Termination Notice must be received by Landlord at least three hundred sixty five
(365)days prior to the Termination Date;
(b) Tenant shall not be in default of any of the provisions or conditions of this Lease at the
time of Termination Notice which remains continuing,and for the remainder of the Term
through the Termination Date;
(c) No more than 50% of the Premises is sublet for a term extending past the Termination
Date,and any sublease for the Premises shall contain the ability of PAE to terminate on or
before the Termination Date;
(d) The Lease has not been assigned(other than to a Permitted Transferee,as defined in§13.02
of the Lease);
(e) Within thirty (30) days of Landlord's receipt of the Termination Notice, Landlord shall
calculate the "Termination Fee" which shall be an amount equal to(1)three(3) months
of Base and Additional Rent at the rate in effect at the time of the giving of the Termination
Notice; (2) the unamortized costs of any Broker's commissions and the Construction
Allowance paid by Landlord regarding this Lease, including without limitation (but
excluding any Base Rent abated under Section 1.1(i) of this Lease), such costs to be
amortized over the initial term of the Lease at an interest rate of six percent(6%);and shall
give Tenant written notice of same. Tenant shall tender payment in full of said Termination
Fee to Landlord due on the effective termination date. Tenant shall continue to pay Base
and Additional Rent as they come due under the Lease through the Termination Date;and
(f) Notwithstanding what is set forth herein,if space has been added to the Premises since the
date of the granting of this Termination Option to Tenant,then the Termination Fee shall
be increased in any such amendment by an amount equal to the unamortized portion of any
allowances, leasing commissions, expenses or other tenant concessions incurred by
Landlord in connection with such additional space leased by Tenant that is subject to this
Termination Option.
(g) If Tenant,subsequent providing Landlord with a Termination Notice,defaults in any of the
monetary provisions of this Lease which Default remains uncured,Landlord,at its option,
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may (1) declare Tenant's exercise of the Termination Option to be null and void, or (2)
continue to honor Tenant's exercise of its Termination Option in which case,Tenant shall
remain liable for the payment of all Base Rent, Additional Base Rent and other sums due
under the Lease up to and including the Termination Date even though billings for such
may occur subsequent to the Termination Date.
(h) Tenant shall continue to be fully liable after the Termination Date for Tenant's financial
obligations accruing through the Termination Date(including,without limitation,rents and
charges identified above and other costs, if any), and Tenant shall pay all amounts in full
within ten(10)calendar days of the date of Landlord's invoice(s);
(i) As of the date Tenant provides Landlord with a Termination Notice,any unexercised rights
or options of Tenant to extend and/or renew the Lease Term or expand the Premises
(whether by expansion option, rights of first refusal, rights of first offer or other similar
rights)and any outstanding tenant improvement allowance or other allowance not applied
for and properly utilized by Tenant in accordance with the Lease as of that date,shall im-
mediately be deemed terminated and no longer available or of any further force or effect;
and
(j) Time is of the essence of this Termination Option.
4. RENT
4.1 Base Rent.Tenant shall prepay one(1)month's installment of Base Rent by the Execution Date,to
be applied against Base Rent first due under this Lease. During the Term, Tenant shall pay all other Base Rent in
advance, in equal monthly installments, by the first (1") of each month. Base Rent for any partial month will be
prorated.
4.2 Additional Rent. Tenant's obligation to pay Taxes and Expenses under this §4.2 is referred to in
this Lease as"Additional Rent"
(a) Taxes. For each full or partial calendar year during the Term after the Base Year (each,a "Com-
parison Year"), Tenant shall pay, in the manner described below, Tenant's Share of the amount
that Taxes for the Comparison Year exceed Taxes for the Base Year("Excess Taxes"). "Taxes"
mean the total costs incurred by Landlord for:(1)real and personal property taxes and assessments
(including ad valorem and special assessments,including any community improvement district as-
sessments)levied on the Project and Landlord's personal property used in connection with the Pro-
ject;(2)taxes on rents or other income derived from the Building;(3)capital and place-of-business
taxes; (4)taxes, assessments or fees in lieu of the taxes described in(1-3); and(5)the reasonable
costs incurred to reduce the taxes described in(1-4).Taxes exclude net income taxes and taxes paid
under§4.3.Tenant acknowledges that Taxes may increase during the Term and that ifthe Project is
currently subject to a Taxes abatement program and such program ceases to benefit the Project dur-
ing the Term, Taxes will increase. If Landlord incurs Taxes for the Project together with one or
more other adjacent buildings or properties, such shared Taxes shall be equitably prorated and ap-
portioned to the various buildings on any equitable basis that Landlord selects.
(b) Expenses. For each Comparison Year,Tenant shall pay, in the manner described below,Tenant's
Share of the amount that Expenses for the Comparison Year exceed Expenses for the Base Year
("Excess Expenses"). "Expenses" mean the total costs incurred by Landlord to operate,manage,
administer, equip, secure, protect, repair, replace, refurbish, clean, maintain, decorate and inspect
the Project,including a fee to manage the Project of five percent(5%)of the gross revenue of the
Project.Expenses that vary with occupancy will be calculated as if the Building is ninety five percent
(95%)occupied and operating.
(1) Expenses include:
(A) Standard Services provided under§6.1;
(B) Repairs and maintenance performed under§7.2;
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(C) Insurance maintained under §9.2 (including deductibles paid), including any
amounts that would be charged as premiums if Landlord self-insures any of the
insurance risks;
(D) Wages,salaries and benefits of personnel to the extent they render services to the
Project;
(E) Costs of operating the Project management office,the Project conference center
and the Project Fitness Center, including reasonable rent for each,provided that
the expenses far the Project Fitness Center are subject to Landlord's approved
limitation;
(F) Amortization installments of costs required to be capitalized and incurred:
0) To comply with insurance requirements or Laws ("Mandated
Expenses");
(ii) That are reasonably calculated to reduce other Expenses or the rate of
increase in other Expenses("Cost-Saving Expenses");or
(iii) That are reasonably calculated to improve or maintain the safety, health
or access of Project occupants, and otherwise maintain the quality,
appearance,or integrity of the Project("Quality Expenses").
(G) Costs of operating the Parking Facilities.
(2) Expenses exclude:
(A) Taxes(as defined in§4.2(a)above);
(B) Mortgage payments(principal and interest),and ground lease rent;
(C) Commissions, advertising costs, attorney's fees and costs of improvements in
connection with leasing space in the Building;
(D) Costs reimbursed by insurance proceeds or tenants of the Building(other than as
Additional Rent);
(E) Depreciation;
(F) Except for the costs identified in §4.2(b)(1)(F), costs required to be capitalized
according to sound real estate accounting and management principles,
consistently applied;
(G) Collection costs and legal fees paid in disputes with tenants;
(H) Costs to maintain and operate the entity that is Landlord(as opposed to operation
and maintenance of the Project);and
(I) In the Base Year only,installments of costs amortized under subsection(c)of this
§4.2.
(c) Amortization and Accounting Principles.
(1) Each item of Mandated Expenses and Quality Expenses will be fully amortized in equal
annual installments, with interest on the principal balance at the Amortization Rate, over
the number of years, not to exceed ten (10),that Landlord projects the item of Expenses
will be productive for its intended use, without replacement, but properly repaired and
maintained.
(2) Each item of Cost-Saving Expenses will be fully amortized in equal annual installments,
with interest on the principal balance at the Amortization Rate, over the number of years
that Landlord reasonably estimates for the present value of the projected savings in
Expenses(discounted at the Amortization Rate)to equal the cost.
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(3) Any item of Expenses of significant cost that is not required to be capitalized but is
unexpected or does not typically recur may,in Landlord's discretion,be amortized in equal
annual installments,with interest on the principal balance at the Amortization Rate,over a
number of years determined by Landlord.
(4) "Amortization Rate"means eight percent(8%).
(5) Landlord will otherwise use sound real estate accounting and management principles,
consistently applied,to determine Additional Rent,including without limitation,reducing
or excluding from the Base Year those Expenses resulting from (A) any unusual or one
time costs or cost increases, including any market wide energy cost spikes, increases,
surcharges or taxes, irregular snow falls or other costs or cost increases due to weather
and/or Force Majeure,and(B)the amortization of capital expenditures otherwise permitted
under this Lease to be included in Expenses, provided that the amortization of capital
expenditures shall only be included in subsequent years to the extent allowed under this
Lease.
(6) If Expenses and/or Taxes in any calendar year decrease below the amount of Expenses
and/or Taxes for the Base Year,Tenant's Excess Expenses and/or Tenant's Excess Taxes,
as the case may be,for that calendar year shall be$0.00,and shall in no event be less than
zero dollars or entitle Tenant to any refund.
(6) If Landlord incurs Expenses for the Project together with one or more other adjacent
buildings or properties,such shared Expenses shall be equitably prorated and apportioned
to the various buildings on any equitable basis that Landlord selects.
(d) Estimates.Landlord will reasonably estimate Additional Rent for each calendar year that Additional
Rent may be payable.Tenant will pay the estimated Additional Rent in advance, in equal monthly
installments,by the first day of each month. Landlord may reasonably revise its estimate during a
calendar year and Tenant will pay the monthly installments based on the revised estimate,
commencing thirty (30) days following the date of such revision. The aggregate estimates of
Additional Rent payable by Tenant in a calendar year is the"Estimated Additional Rent."
(e) Settlement.As soon as practical after the end of each calendar year that Additional Rent is payable,
Landlord will give Tenant a statement of the actual Additional Rent for the calendar year. The
statement of Additional Rent is conclusive,binds Tenant,and Tenant waives all rights to contest the
statement,except for items of Additional Rent to which Tenant objects by notice to Landlord given
within ninety(90)days after receipt of Landlord's statement;however,Tenant's objection will not
relieve Tenant from its obligation to pay Additional Rent pending resolution of any objection.If the
Additional Rent exceeds the Estimated Additional Rent for the calendar year,Tenant shall pay the
difference to Landlord in a lump sum as Rent within thirty (30) days after receipt of Landlord's
statement of Additional Rent_ If the Estimated Additional Rent paid by Tenant exceeds the
Additional Rent for the calendar year,then Landlord shall credit the overpayment against Rent next
due.However,if the Term ends during a calendar year,Landlord may,in Landlord's sole discretion,
elect to either: (1)forego the settlement of Additional Rent for the calendar year that is otherwise
required and accept the Tenant's payment of Estimated Additional Rent for such calendar year in
satisfaction of Tenant's obligations to pay Additional Rent for the final calendar year, or(2) have
Landlord's and Tenant's obligations under this§4.2(e)survive the end of the Term.
(f) Cap on Adjustments, Notwithstanding the foregoing or anything to the contrary elsewhere in this
Lease, Landlord agrees that no annual adjustment of Operating Expenses shall be exceed one
hundred five percent(105%) of Operating Expenses for the year then ending; provided, however,
that the foregoing non-cumulative limitation on Operating Expense adjustments shall not apply to
Taxes,Landlord's insurance premiums,or utility costs only,it being agreed that such costs are not
within Landlord's reasonable ability to control.
4.3 Other Taxes. Upon demand, Tenant will reimburse Landlord for taxes paid by Landlord on (a)
Tenant's Personal Property, (b) Rent, (c) Tenant's occupancy of the Premises, or (d) this Lease. if Tenant cannot
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lawfully reimburse Landlord for these taxes,then the Base Rent will be increased to yield to Landlord the same amount
after these taxes were imposed as Landlord would have received before these taxes were imposed.
4.4 Terms of Payment."Rent"means all amounts payable by or on behalf of Tenant under this Lease
and the exhibits, including Base Rent and Additional Rent. Rent will be paid to Landlord without notice or demand
and without right of deduction,abatement or setoff,except as otherwise expressly provided in this Lease.If a time for
payment of an item of Rent is not specified in this Lease,then Tenant will pay Rent within thirty(30)days after receipt
of Landlord's statement or invoice. Unless otherwise provided in this Lease, Tenant shall pay Rent without notice,
demand,deduction,abatement or setoff,in lawful U.S,currency,at Landlord's Billing Address or to such other person
or at such other place as Landlord may from time to time designate in writing.Landlord will send statements payable
by Tenant to Tenant's Billing Address; however,neither Landlord's failure to send a statement nor Tenant's failure
to receive a statement for Base Rent (and installments of Estimated Additional Rent) will relieve Tenant of its
obligation to timely pay Base Rent(and installments of Estimated Additional Rent).Each partial payment by Tenant
shall be deemed a payment on account.No endorsement or statement on any check or any accompanying letter shall
constitute an accord and satisfaction, affect Landlord's right to collect the full amount due, or require Landlord to
apply any payment to other than Rent earliest due.No payment by Tenant to Landlord will be deemed to extend the
Term or render any notice, pending suit or judgment ineffective. By notice to the other, each party may change its
Billing Address. Any payment made by or on behalf of Tenant to a lockbox maintained by Landlord for receipt of
payment of Rent shall not be deemed to have been accepted by Landlord provided such payment is returned to Tenant
within ten(10)days after Landlord receives notice that the payment has been received into the lockbox.
4.5 Late Payment.If Landlord does not receive all or part of any item of Rent when due,then Tenant
shall pay to Landlord a"Late Charge"of five percent(5%)of the overdue amount.Tenant agrees that the Late Charge
is not a penalty, and will compensate Landlord for costs not contemplated under this Lease that are impractical or
extremely difficult to fix. Landlord's acceptance of payment of a Late Charge does not waive Tenant's default. In
addition,all amounts payable under this Lease by Tenant to Landlord,if not paid in full when due,will bear interest
at the lesser of the highest interest rate permitted by law or eighteen percent(18%).
4.6 Enabling Payment.Landlord agrees to undertake any reasonable steps necessary to permit Tenant
to pay due amounts in compliance with law and Tenant corporate policy.This includes but may not be limited to items
such as securing a Dunn&Bradstreet number,completing Tenant's vendor screening processes,and completing forms
required to register in Tenant's electronic fund transfer system.
5. USE & OCCUPANCY
5.1 Use. Tenant shall use and occupy the Premises only for the Use. Landlord does not represent or
warrant that the Project is suitable for the conduct of Tenant's particular business.
5.2 Compliance with Laws and Directives.
(a) Tenant's Compliance.Subject to the remaining terms of this Lease,Tenant shall comply,at Tenant's
expense, with all commercially reasonable directives of Landlord's insurers and with any and all
present or future federal,state or local laws,statutes,ordinances,rules,regulations or orders of any
and all governmental or quasi-governmental authorities having jurisdiction("Laws")concerning:
(1) The Leasehold Improvements and Alterations,
(2) Tenant's use or occupancy of the Premises,
(3) Tenant's employer/employee obligations,
(4) A condition created by Tenant,or its Affiliates,contractors,or invitees,
(5) Tenant's failure to comply with this Lease,
(6) The negligence of Tenant or its Affiliates or contractors,and
(7) Any chemical wastes, contaminants, pollutants or substances that are hazardous, toxic,
infectious,flammable or dangerous,or regulated by any local,state or federal statute,rule,
regulation or ordinance for the protection of health or the environment ("Hazardous
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Materials") that are introduced to the Project, handled or disposed by Tenant or its
Affiliates,or any of their contractors.
(b) Landlord's Compliance. The cost of Landlord's compliance with all directives of Landlord's
insurers, governing authorities or Laws concerning the Project, other than those that are Tenant's
obligation under subsection(a),will be included in Expenses to the extent allowed under§4.2.
5.3 Occupancy.Tenant shall not interfere with Building services or other tenants'rights to quietly enjoy
their respective premises or the Common Areas. Tenant shall not make or continue a nuisance, including any
objectionable odor,noise,fire hazard,vibration,or wireless or electromagnetic transmission.Tenant will not maintain
any Leasehold Improvements or use the Premises in a way that increases the cost of insurance required under§9.2,or
requires insurance in addition to the coverage required under§9.2.Except as may be expressly permitted by Landlord
in writing,Tenant will not store,use,release,produce,process or dispose in,on or about,or transport to or from,the
Premises or Building any Hazardous Materials,
6. SERVICES & UTILITIES
6.1 Standard Services.
(a) Standard Services Defined."Standard Services"mean:
(1) Heating,ventilation and air-conditioning("HVAC")during Business Hours as reasonably
required to comfortably use and occupy the Premises and interior Common Areas (not
including any supplemental HVAC systems that exclusively service the Premises);
(2) Water from the public utility for use in Common Areas rest rooms;
(3) Janitorial services to the Premises and interior Common Areas consistent with a first-class
building as determined by Landlord, on business days, exclusive of Holidays; provided,
upon not less than thirty(30)days'prior written notice to Landlord,Tenant shall have the
right to contract directly with a service provider reasonably approved by Landlord for all
janitorial services to the Premises,and if Tenant elects to do so,Base Rent shall be adjusted
to subtract the casts of janitorial services from Base Rent based on the most recent budget
for the Building.
(4) Access to the Premises(by at least one (1] passenger elevator if not on the ground floor).
Subject to Landlord's security procedures at the Building from time to time,Tenant shall
have 24/7/365 access to the Premises, and Tenant shall be permitted to install a security
system in the Premises and a security card reader on the Common Area lobby door(s)of
the Premises for Tenant's employees, subject to approval pursuant to Exhibit B and/or
Article 8 of this Lease as the case may be;
(5) Labor to replace fluorescent tubes and ballasts in Building Standard light fixtures in the
Premises;and
(6) Electricity from Landlord's selected provider(s)for Common Areas lighting,and Building
Standard HVAC services for the Premises and the Common Areas.
(b) Standard Services Provided.During the Term, Landlord will provide Standard Services to Tenant,
except as provided in this Article 6. The cost of Standard Services will be included in Expenses.
Landlord will not be responsible for any inability to provide Standard Services due to either: the
concentration of personnel or equipment in the Premises; or Tenant's use of equipment in the
Premises that is not customary office equipment, has special cooling requirements, or generates
excessive heat.
6.2 Additional Services. Unless Tenant obtains Landlord's prior written consent,Tenant will not use
utilities or services in excess of the Standard Services. If Landlord so consents, Landlord may provide utilities and
services in excess of the Standard Services subject to the following:
(a) After Hours HVAC. If Tenant requests HVAC service to the Premises during non-Business Hours,
Tenant will pay as Rent Landlord's scheduled-rate for this service. Landlord's current scheduled
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rate for after hours HVAC services is$50.00 per hour per floor,subject to change from time to time
on a uniform basis at the Building. Tenant shall not be charged for its first one hundred(100)hours
of after hours HVAC services in any calendar year.
(b) Lighting. Landlord will furnish both Building Standard and non-Building Standard lamps, bulbs,
ballasts and starters that are part of the Leasehold Improvements for purchase by Tenant at
Landlord's cost, plus Landlord's standard administration fee. Landlord will install non-Building
Standard items at Landlord's scheduled rate for this service.
(c) Other Utilities and Services.Tenant will pay as Rent the actual cost of utilities or services either
used by Tenant or provided at Tenant's request that are in excess of that provided as part of the
Standard Services. Such services will include the cost of the water,electricity and/or other utilities
used in the operation of any supplemental HVAC systems that exclusively service the Premises.
Tenant's excess consumption may be estimated by Landlord unless either Landlord requires or
Tenant elects to install Building Standard meters to measure Tenant's consumption.
(d) Additional_Systems and Metering. At any time during the Term, Landlord may require Tenant, at
Tenant's expense,to upgrade or modify existing Mechanical Systems serving the Premises or the
Leasehold Improvements to the extent necessary to meet Tenant's excess requirements(including
installation of Building Standard meters to measure the same).
6.3 Electrical Service to Premises. Landlord shall provide electrical service to the Premises for all
lighting,convenience outlets and any supplemental HVAC system exclusively serving the Premises,and Tenant shall
pay Landlord, as Additional Rent, the cost of its estimated pro-rata share of such electrical usage for the Premises
(exclusive of Building Standard HVAC for the Premises). The connected load in the Premises will not at any time
exceed 5.8 watts per RSF of the Premises (exclusive of Building Standard HVAC for the premises) ("Maximum
Connected Load"),nor will Landlord be required to provide electricity to the Premises during any one calendar month
in an amount that exceeds the Maximum Connected Load multiplied by the number of Business Hours during said
month.Landlord may elect,at any time during the Term,and continuing for the remainder of the Term,to separately
meter Tenant's total consumption of electricity in the Premises,including lighting and convenience outlets.If Landlord
so elects,then Landlord shall notify Tenant of such election,and Tenant shall pay to Landlord as Rent the actual cost
of Tenant's electricity consumption.
6.4 Telecommunication Services.Tenant will contract directly with third party providers and will be
solely responsible for paying for all telephone,data transmission,video,cable television and other telecommunication
services("Telecommunication Services")subject to the following:
(a) Providers. Each Telecommunication Services provider that does not already provide service to the
Building shall be subject to Landlord's approval,which Landlord may withhold in Landlord's sole
discretion. Without liability to Tenant, the license of any Telecommunication Services provider
servicing the Building may be terminated under the terms of the license, or not renewed upon the
expiration of the license.
(b) Tenant's Wiring. Landlord may, in its sole discretion, designate the location of all wires, cables,
fibers,equipment,and connections("Tenant's Wiring")for Tenant's Telecommunication Services,
as well as restrict and control access to telephone cabinets and rooms.Tenant may not use or access
the Base Building, Common Areas or roof for Tenant's Wiring without Landlord's prior written
consent, which Landlord may withhold in Landlord's sole discretion, or for which Landlord may
charge a fee determined by Landlord_
(c) No Beneficiaries. This §6.4 is solely for Tenant's benefit, and no one else shall be considered a
beneficiary of these provisions.
6.5 Special Circumstances. Without breaching this Lease or creating any liability on the part of
Landlord, Landlord may interrupt, limit or discontinue any utility or services Landlord provides under this Article 6
or which are obtained by Tenant under this Article 6 under any of the following circumstances:(a)in an emergency;
(b)to comply with Laws or to conform to voluntary government or industry guidelines;(c)to repair and maintain the
Project under§7.2;or(d)to modify,renovate or improve the Project under§8.2 provided Landlord provides 24 hours
advance written notice. Landlord shall not be liable in any manner for any interruption in services to be provided by
Landlord or obtained by Tenant under this Article 6.
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6.6 Emergency Generator/Backup Power.
(a) Grant of License. Subject to the terms and conditions of this Paragraph 6.6 and the other
applicable provisions of this Lease, including without limitation the applicable review and approval procedures set
forth in Exhibit B and Article 8 of this Lease,Landlord hereby grants to Tenant a personal license(the"License")to
install,maintain and operate an emergency electrical generator or generators(collectively,the"Generator"),and an
Uninterruptible Power Supply System (the "UPS System"), including the necessary wiring, conduit and cabling
connecting the Generator and the UPS System to the Premises(collectively,the"Back-up Equipment"). The Gen-
erator and the UPS System shall be located in areas subject to Landlord's prior written approval. The Back-up Equip-
ment may include supplemental heating,ventilation and air conditioning equipment for the UPS System,together with
a sub-meter to monitor the electricity used by such equipment. Tenant shall pay no Rent for use of the area(s) in
which said Generator and/or UPS system shall be located, but all such equipment shall be connected to Tenant's
electrical service and all electrical consumption associated therewith shall be payable by Tenant pursuant to Section
6.3 above.
(b) Term of License. The term of this License shall be co-terminous with the Lease,
(c) Installation of the Back-up Equipment. Landlord's approval of the instal lation/opera-
tion of the Back-up Equipment shall not be construed in any way as approval by Landlord of the adequacy or safety
of the installation of the Back-up Equipment or a waiver of any of Landlord's rights hereunder, and Tenant shall be
solely responsible for the adequacy and safety of the installation and operation of the Back-up Equipment and solely
liable for any damages or injury arising out of such installation and operation.
(d) Maintenance and Operation of the Back-up Equipment. Tenant shall operate the Back-
up Equipment in strict compliance with all applicable Laws,at Tenant's own risk,and Tenant shall be solely respon-
sible throughout the Term of the Lease,as extended,for maintaining,servicing and repairing the Back-up Equipment,
at Tenant's sole expense. Tenant shall, at Tenant's sole cost and expense, maintain a maintenance contract on the
Back-up Equipment throughout the Term of the Lease, as extended herein. Landlord shall have no Obligation or
responsibility whatsoever for performing any maintenance, testing or repair of the Back-up Equipment,even in the
event of an emergency, as Tenant shall solely have all such obligation and responsibility. Tenant shall take such
precautions as may be reasonably necessary to ensure that their operation of the Back-up Equipment does not cause a
nuisance,nor unreasonably interfere with the rights of other tenants of the Building to the use and enjoyment of their
premises. Specifically, any routine testing of the Generator shall be done by Tenant prior to 7:30 a.m.,or after 6:00
p.m. on normal business days, in order to minimize any disturbance that operating the Generator would cause to
adjacent tenants in the Building, or during the period between 7.30 a.m. and 6:00 p.m. on normal business days,
provided that any testing during such time shall be scheduled at a time that minimizes any disturbance to other tenants
of the Building and is mutually acceptable to Landlord.
(e) Access to the Generator Area and the UPS Area. By written notice to Landlord, Co-
Licensees shall designate the individuals who,on behalf of Tenant,shall have access to the Back-up Equipment,which
designation Tenant may revise from time to time. Landlord shall have the right to limit and monitor access to the
Back-up Equipment by a card reader at the entrance to such area, and issuing access cards to Tenant, in which case
Tenant shall reimburse Landlord for the reasonable cost of the access cards. Notwithstanding the License granted to
Tenant,Landlord shall at all times have access to the areas in which the Bask-up Equipment is located for the purpose
of operating,maintaining,repairing or improving the Project and the Building and its appurtenances. Landlord agrees
that Tenant shall also have continuous access to the Back-up Equipment as aforesaid. Landlord shall have no respon-
sibility or liability for the conduct or safety of any of Tenant's representatives, repair, maintenance and engineering
personnel while in any part of the Project or Building and Tenant shall be solely liable for any injury to or death of
any such person from any cause resulting from the installation, operation,maintenance,repair, inspection,or use of
the Back-up Equipment by Tenant or its agents,employees,representatives,contractors or invitees.
(f) Relocation of the Backup Equipment. In the event that in the course of maintaining,
repairing or improving the Project or the Building or the Common Areas, it shall become necessary for the Back-up
Equipment to be relocated in order for Landlord to perform such maintenance, repair or improvement, then, upon
reasonable prior notice from Landlord, Tenant shall relocate the Back-up Equipment, either temporarily or
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permanently as required by the circumstances,to other space in the Common Areas of the Project or Building that is
acceptable to both parties,and Landlord shall reimburse Tenant for all costs incurred in relocating the Back-up Equip-
ment, with such reimbursement to be made within thirty (30) days after Landlord's receipt of documentation from
Tenant reflecting the amount of such costs.
(g) Insurance. For purposes of fulfilling Tenant's requirements under the Lease with respect
to insurance,as modified herein,the area(s)in which the Back-up Equipment is located shall be considered part of the
Premises,and Tenant shall,at Tenant's cost,obtain and keep in force during the Term of the Lease,as extended,all
forms of insurance required by the terms of the Lease,as modified herein,covering the Back-up Equipment.
(h) Indemnity. Subject to the waiver of subrogation by Tenant contained in Section 9.1(d)of
the Lease,Tenant shall indemnify and hold Landlord,its agents,employees,contractors and representatives,harmless
from and against any and all costs, claims,damages,causes of actions and liability whatsoever which may arise out
of or in any way be attributable to the installation,maintenance,repair or operation of the Back-up Equipment during
the Term, as the same may be further extended by the parties, including, without limitation, any claim or cause of
action for injury to or death of any person or damage to any property, and Tenant shall defend any claim, cause of
action or demand against Landlord,its agents and employees,arising out of any such occurrence. All obligations of
Tenant under this subparagraph that have accrued as of the expiration or earlier termination of the Lease, but which
remain unfulfilled as of such date, shall survive the expiration or earlier termination of the Lease. In no event shall
this provision be construed as or have the effect of altering or extending any applicable statute of limitation or repose.
(i) Default. If Tenant fail to fulfill its obligations under this Section 6.6,and such failure shall
continue for a period of thirty(30)days after Tenant's receipt of written notice of the existence of such failure from
Landlord,then such failure shall constitute an Event of Default under the Lease.
7. REPAIRS
7.1 Tenant's Repairs. Except as provided in Articles 10 and 12, during the Term,Tenant hereby as-
sumes full responsibility for the condition of the Premises and shall,at Tenant's cost,repair,maintain and replace,if
necessary,the Leasehold Improvements and keep the Premises in good order,condition and repair,ordinary wear and
tear excepted.In addition,Tenant shall be responsible for all repairs,replacements and alterations in and to the Prem-
ises,Building and Project necessitated by(a)Tenant's use or occupancy of the Premises,(b)the installation,removal,
use or operation of Tenant's Property or Leasehold Improvements,(c)the moving of Tenant's Property into or out of
the Building,or(d)the act,omission,misuse or negligence of Tenant,its Affiliates,contractors or invitees.Tenant's
work under this§7.1 must be(i)approved by Landlord before commencement,(ii)supervised by Landlord at Tenant's
expense,if Landlord reasonably so requires,and(iii)performed in compliance with Law and in a first-class manner
with materials of at least Building Standard. All repairs will be performed by qualified contractors that meet Land-
lord's insurance requirements, provide Landlord with the appropriate certificate(s) of insurance prior to the start of
work and are otherwise approved by Landlord. If Tenant fails to perform any of its obligations under this §7.1,then
Landlord may perform such obligations and Tenant will pay,as Rent to Landlord,the reasonable cost of such perfor-
mance,including an amount sufficient to reimburse Landlord for overhead and supervision,within ten(10)days after
the date of Landlord's invoice. For the purpose of performing such obligations,or to inspect the Premises,Landlord
may enter the Premises upon not less than ten(10)days'prior notice to Tenant(except in cases of actual or suspected
emergency,in which case no prior notice will be required)without liability to Tenant for any loss or damage incurred
as a result of such entry,provided that Landlord will take reasonable steps in connection with such entry to minimize
any disruption to Tenant's business or its use of the Premises. Tenant will notify Landlord promptly after Tenant
learns of(x) any fire or other casualty in the Premises, (y) any damage to or defect in the Premises, including the
fixtures and equipment in the Premises,for the repair of which Landlord might be responsible, or(z)any damage to
or defect in any parts of appurtenances of the Building's sanitary,electrical heating,air conditioning,elevator or other
systems located in or passing through the Premises.
7.2 Landlord's Repairs. Except as provided in Articles 10 and 12 and except to the extent such
obligations are expressly imposed upon Tenant hereunder, during the Term Landlord shall repair, maintain and
replace,if necessary,the Base Building and Common Areas,and shall otherwise keep the Project in good order and
condition according to the standards prevailing for comparable office buildings in the area in which the Building is
located. Except in an emergency, Landlord will use commercially reasonable efforts to avoid disrupting Tenant's
permitted Use of the Premises in performing Landlord's duties under this §7.2,but shall not be required to employ
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premium labor.Tenant may not repair or maintain the Project on Landlord's behalf or offset any Rent for any repair
or maintenance of the Project that is undertaken by Tenant.
8. ALTERATIONS
8.1 Alterations by Tenant. "Alterations" mean any modification, addition or improvement to the
Premises or Leasehold Improvements made by Tenant during the Term, including any modification to the Base
Building or Common Areas required by law or governing authority as a condition of performing the work.Alterations
do not include work performed under the Work Letter attached hereto as Exhibit B.All Alterations,whether temporary
or permanent in character, made or paid for by Landlord or Tenant will, without compensation to Tenant, become
Landlord's property upon the expiration or earlier termination of the Lease.Alterations are made at Tenant's sole cost
and expense,subject to the following:
(a) Consent Required. All Alterations require Landlord's prior written consent. If a Design Problem.
exists, Landlord may withhold its consent in Landlord's sole discretion; otherwise, Landlord will
not unreasonably withhold its consent. Unless Tenant obtains Landlord's prior written consent to
the Alterations becoming part of the Premises to be tendered to Landlord on termination of this
Lease,Landlord may require Tenant to remove Alterations and restore the Premises under§3.3 upon
termination of this Lease.
(b) Design Problem Defined. "Design Problem" means a condition that results, or will result, from
work proposed,being performed or that has been completed that either:
(1) Does not comply with Laws;
(2) Does not meet or exceed the Building Standard;
(3) Exceeds the capacity of, adversely affects, is incompatible with, or impairs Landlord's
ability to maintain,operate,alter,modify or improve the Base Building;
(4) Affects the exterior appearance of the Building or Common Areas;
(5) Violates any agreement affecting the Project;
(6) Is a Required Removable(as defined below);
(7) Violates any insurance regulations or standards for a fire-resistive office building;or
(8) Locates any equipment,Tenant's Wiring or Tenant's Personal Property on the roof of the
Building (except as specifically agreed to by Landlord), in Common Areas or in
telecommunication or electrical closets.
(c) A "Required Removable" is any item of Leasehold Improvements or Alterations that, in
Landlord's reasonable judgment, is of a nature that would require removal and repair costs that are
materially in excess of the removal and repair costs associated with standard office improvements.
Required Removables shall include, without limitation, internal stairways, raised floors, personal
baths and showers,vaults,rolling file systems and structural alterations and modifications. Except
as specifically agreed to in writing by Landlord in its sole discretion,the Required Removables shall
be removed by Tenant before the Expiration Date. Tenant shall repair damage caused by the
installation or removal of Required Removables.If Tenant fails to perform its obligations in a timely
manner, Landlord may perform such work at Tenant's expense. Tenant, at the time it requests
approval for a proposed Alteration or Leaschold Improvements(including any Tenant Improvements
or Landlord's Work),may request in writing that Landlord advise Tenant whether such Alteration or
Leasehold Improvement,or any portion thereof,is a Required Removable. Within ten(10)days after
receipt of Tenant's request, Landlord shall advise Tenant in writing as to which portions of the
Alterations or other improvements are Required Removables. Tenant's Wiring and improvements
shall not be a Required Removable.
(d) Performance of Alterations. Alterations shall be performed by Tenant in a good and workman-like
manner according to plans and specifications approved by Landlord. All Alterations shall comply
with law and insurance requirements. Landlord's designated contractors must perform Alterations
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affecting the Base Building or Mechanical Systems and all other work will be performed by
qualified contractors that meet Landlord's insurance requirements, provide Landlord with the
appropriate certificate(s) of insurance prior to the start of work and are otherwise approved by
Landlord. Promptly after completing Alterations, Tenant will deliver to Landlord "as-built"CAD
plans,proof of payment,a copy of all recorded documents required in§8.3 including the recorded
notice of completion, and unconditional lien releases from all contractors, subcontractors and
materialmen that have constructed or provided materials for all or any part of the Alterations.If the
performance of any Alteration by Tenant interferes with the harmonious labor relations in existence
in the Building,all such work shall be halted immediately by Tenant until such time as construction
can proceed without any such interference.
(e) Bonding. If requested by Landlord, before commencing Alterations Tenant shall at Tenant's cast
obtain bonds, or deposit with landlord other security acceptable to Landlord for the payment and
completion of the Alterations.These bonds or other security shall be in form and amount acceptable
to Landlord.
(f) Alterations Fee.Tenant shall pay Landlord,as Rent,five percent(5%)of the total construction costs
of the Alterations to cover review of Tenant's plans and construction coordination by Landlord's
employees("Alterations Fee").In addition,Tenant shall reimburse Landlord for the actual cost that
Landlord reasonably incurs to have engineers, architects or other professional consultants review
Tenant's plans and work in progress,or inspect the completed Alterations.
8.2 Alterations by Landlord. Landlord may modify, renovate or improve the Project as Landlord
deems appropriate, provided Landlord uses commercially reasonable efforts to avoid disrupting Tenant's permitted
Use of the Premises.
8.3 Liens and Disputes.Tenant will keep title to the Land and Building,as well as Tenant's leasehold
interest in the Premises, free of any liens concerning the Leasehold Improvements,Alterations,or Tenant's Personal
Property,and will promptly take whatever action is required to have any of these liens released and removed of record
(including, as necessary, posting a band or other deposit). To the extent legally permitted, each contract and
subcontract for Alterations will provide that no lien attaches to or may be claimed against the Project. Tenant will
indemnify Landlord for costs and expenses that Landlord reasonably incurs because of Tenant's violation of this§8.3.
9. INSURANCE
9.1 Tenant's Insurance.
(a) Tenant's Coverage. Before taking possession of the Premises for any purpose (including
construction of Tenant Improvements,if any)and during the Term,Tenant will provide and keep in
force the following coverage:
(1) Commercial general liability insurance insuring Tenant's use and occupancy of the
Premises and use of the Common Areas, and covering personal and bodily injury, death,
and damage to others' property of not less than the Liability Limit. Each of these policies
shall include cross liability and severability of interests clauses, and be written on an
occurrence, and not claims-made,basis. Each of these policies shall name Landlord, the
Building property manager,each secured lender,and any other party reasonably designated
by Landlord as an additional insured ("Additional Insured"). The commercial general
liability insurance carried by Landlord or other Additional Insured pursuant to the terms of
this Lease shall be non-contributing and Tenant's commercial general liability insurance
shall be primary to any such insurance carried by Landlord or other Additional Insured.
Tenant's commercial general liability insurance may be provided by a combination of a
primary and an umbrella or excess liability policy, provided that such excess policy shall
be on a"following form"including a"drop down"feature in case the limits of the primary
policy are exhausted and the primary policy shall not be less than $1 million for any one
accident or occurrence;
(2) Property damage insurance on a special form basis covering all risks (including standard
extended coverage endorsement perils,leakage from fire protective devices and other water
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damage)covering the full replacement cost of the Leasehold Improvements and Tenant's
Personal Property in amounts sufficient to prevent Tenant from becoming a co-insurer and
subject only to such deductibles and exclusions as Landlord may reasonably approve.Each
of these policies shall name Landlord and each Additional Insured as an additional insured
as well as a loss payee to the extent of their interest in the Leasehold Improvements.Each
of these policies shall include a provision or endorsement in which the insurer waives its
right of subrogation against Landlord and each Additional Insured;
(3) Insurance covering the perils described in(2)for Tenant's loss of income or insurable gross
profits with a limit not less than Tenant's annual Rent;
(4) If any boiler or machinery (including without limitation any supplemental HVAC
equipment) is operated solely to provide service to the Premises, boiler and machinery
insurance,with a limit of at least the Liability Limit;
(S) Lnsurance required by law,including workers'compensation insurance;
(6) Employers liability insurance with limits not less than $Imillion/each accident;
$1 million/disease-each employee;$1million/disease—aggregate;
(7) Commercial automobile liability insurance covering all owned, hired, and non-owned
vehicles with a combined single limit of not less than $lmillion for each accident or
person.;and
(8) Insurance covering the Leasehold Improvements and Tenant's Personal Property against
loss or damage due to earthquake or difference in conditions perils. Tenant may elect to
self-insure this coverage.If Tenant does not elect to self-insure this coverage,then each of
these policies shall name Landlord and each Additional Insured a loss payee to the extent
of their interest in the Leasehold Improvements.
(b) Insurers and Terms. Each policy required under (a) shall be written with insurance companies
licensed to do business in the state in which the Building is located having a rating of not less than
A+and a Financial Size Class ("F'SC") of at least VIII by A. M. Best Company,and be on terms
that are acceptable to Landlord.
(c) Proof of Insurance. Tenant shall provide Landlord with certificates of insurance (including all
additional insured and loss payee endorsements)or other reasonable proof as required by Landlord
that the coverage required under (a) is in effect. The certificate of insurance shall state that the
insurance carrier will give Landlord and all other persons and entities named as certificate holders
at least thirty(30)days prior notice of any cancellation or modification of the policies. In addition,
Tenant will provide Landlord with certificates of insurance(including all additional insured and loss
payee endorsements)or other reasonable proof of renewal or replacement at least thirty (30) days
prior to any policy expiration and failure to provide same shall be a default.If Tenant fails to insure
or pay premiums,or to file satisfactory proof as required above,Landlord may,upon a minimum of
twenty four (24) hours' notice, effect such insurance and recover from Tenant on demand any
premiums paid. Failure of Tenant to provide any insurance required by this Lease shall not be
construed as a waiver of liability or any limit of damages, the parties expressly agreeing that the
requirement to carry insurance shall not be deemed to be an acknowledgment or agreement that said
insurance is adequate to cover the damages so insured.
(d) Waiver of Subrogation. Tenant hereby releases and relieves Landlord and hereby waives its entire
right of recovery against Landlord for any and all loss or damage to any property,including,without
limitation,any and all Leasehold Improvements and any and all Tenant's Personal Property,arising
out of or incident to perils insured against or that could have been insured against by a "special
form"policy of property insurance,even if this loss or damage is due to the negligence of Landlord.
This waiver will include a waiver by Tenant of all rights of subrogation that Tenant's insurers may
have against Landlord.Tenant shall,upon obtaining a policies of insurance covering property loss
or damage to Leasehold Improvements or Tenant's Personal Property give notice to its insurance
carrier or carriers that the foregoing waiver of subrogation is contained in this Lease, and if the
insurance policy does not permit Tenant to waive its insurer's rights of subrogation,then the policy
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shall contain an endorsement in which the insurer waives all of its rights of subrogation against
Landlord.
9.2 Landlord's Insurance.So long as the same is available at commercially reasonable rates,Landlord
shall maintain fire and other casualty property insurance on the Building at replacement cost value as reasonably
estimated by Landlord,together with such other insurance coverage as Landlord,in its reasonable judgment,may elect
to maintain.
10. DAMAGE OR DESTRUCTION
10.1 Damage and Repair.If all or any part of the Project is damaged by fire or other casualty,then the
parties will proceed as follows:
(a) Landlord's Estimates. Landlord will assess the damage to the Project (but not the Leasehold
Improvements) and notify Tenant of Landlord's reasonable estimate of the time required to
substantially complete repairs and restoration of the Project ("Repair Estimate"). Landlord will
also estimate("Interruption Estimate")the time that the Premises will be"Untenantable",which
shall mean that Tenant is actually unable to use all or any portion of the Premises for the normal
conduct of its business.Within thirty(30)days after the later of the casualty,issuance of the Repair
Estimate, issuance of the Interruption Estimate,or receipt of any denial of coverage or reservation
of rights from Landlord's insurer,each party may terminate this Lease by written notice to the other
on the following conditions:
(1) Landlord may elect to terminate this Lease if:
(A) The Repair Estimate exceeds one hundred eighty(180)days;or
(B) The damage or destruction occurs in the last twelve(12)months of the Term;or
(C) The repair and restoration are not fully covered by insurance maintained or
required to be maintained by Landlord (subject only to those deductibles or
retentions Landlord elected to maintain), any mortgagee requires that the
insurance proceeds be applied to the payment of the mortgage debt, Landlord's
insurer denies coverage or reserves its rights on coverage or Landlord determines
in good faith that it is not economically feasible to repair or restore the Building.
(2) Tenant may elect to terminate this Lease if the Interruption Estimate exceeds one hundred
eighty(180)days, or, if the casualty occurred in the last twelve(12)months of the Term,
if the Interruption Estimate exceeds thirty(30)days.
(b) Repairs.Ifneither party terminates the Lease under(a),then the Lease shall remain in full force and
effect and the parties will proceed as follows:
(1) Landlord will repair and restore the Project (but not Leasehold Improvements) to the
condition existing prior to such damage, except for modifications required by law.
Landlord will perform such work with reasonable promptness, subject to delay for loss
adjustment,delay caused by Tenant and Force Majeure.
(2) Tenant will repair and restore the Leasehold Improvements with reasonable promptness to
the condition existing prior to such damage,but not less than current Building Standards,
except for modifications required by law.
(3) Tenant may not terminate this Lease if the actual time to perform the repairs and restoration
exceeds the Repair Estimate,or the actual interruption exceeds the Interruption Estimate.
10.2 Rent Abatement.If,as a result of the damage or destruction under§10.1,any part of the Premises
becomes Untenantable for more than three (3) consecutive business days, then a proportionate amount of Tenant's
Base Rent and Additional Rent for the Untenantable part of the Premises shall be abated from the 41 consecutive
business day until the earlier of the date(a)the damaged or destroyed part of the Premises becomes tenantable,or(b)
fifteen(15)days after Landlord completes its required repairs and restoration.Tenant's sole remedy against Landlord
for damage or destruction of any part of the Project is abatement of Base Rent and Additional Rent under this §10.2,
and Landlord will not be liable to Tenant for any inconvenience or annoyance to Tenant or injury to the business of
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Tenant resulting in any way from damage caused by fire or other casualty or the repair of such damage, or for any
other amount, including damages to Tenant's Personal Property, consequential damages, actual or constructive
eviction, or abatement of any other item of Rent; provided however that,to the extent Tenant remains in possession
of a portion of the Premises, Landlord will take all reasonable steps to minimize the disruption to Tenant's business
and use of such portion of the Premises during any period of repair.
11. INDEMNITY
11.1 Claims. "Claims"mean any and all liabilities,losses, claims, demands, damages or expenses that
are suffered or incurred by a party, including,but not limited to,attorneys' fees reasonably incurred by that party in
the defense or enforcement of the rights of that party.
11.2 Landlord's Waivers and Tenant's Indemnity.
(a) Landlord's Waivers.Landlord waives any Claims against Tenant and its Affiliates for damage to or
loss of Landlord's property insured or required to be insured by Landlord under§9.2,except to the
extent caused by the negligence or willful misconduct of Tenant or its Affiliates but in all events
Landlord waives,except in connection with damages due to Tenant's holdover,any Claims for any
special or consequential damages (such as interruption of business, loss of income, or loss of
opportunity)to the extent not expressly prohibited by Law.
(b) Tenant's Indemnity. Unless waived by Landlord under §I1.2(a), to the extent not expressly
prohibited by Law,Tenant will indemnify and defend Landlord and its Affiliates and hold each of
them harmless from and against Claims arising from:
(1) Any defect,deficiency in or accident or occurrence on or about the Premises,except to the
extent caused by Landlord's or its Affiliates'negligence or willful misconduct;or
(2) Tenant's or its Affiliates' negligence or willful misconduct or breach of this Lease;or
(3) Any claim for commission or other compensation by any person other than the Brokers for
services rendered to Tenant in procuring this Lease.
11.3 Tenant's Waivers and Landlord's Indemnity.
(a) Tenant's Waivers.Tenant waives any Claims against Landlord and its Affiliates for:
(1) Perils insured or required to be insured by Tenant under subsections (2), (3) and (8) of
§9.1(a),except to the extent caused by the negligence or willful misconduct of Landlord or
its Affiliates,but in all events Tenant waives any Claims for any special or consequential
damages (such as interruption of business, loss of income, or loss of opportunity) to the
extent not expressly prohibited by Law,and for loss or damage to Leasehold Improvements
and Tenant's Personal Property;or
(2) Damage caused by any public utility,public work,other tenants or occupants of the Project,
or persons other than Landlord;or
(3) Deleted.
(b) Landlord's Indemnity.Unless waived by Tenant under(a),to the extent not expressly prohibited by
Law,Landlord will indemnify and defend Tenant and its Affiliates and hold each of them harmless
from and against Claims arising from:
(1) Landlord's or its AM Hates' negligence or willful misconduct or breach of this Lease;or
(2) Any claim for commission or other compensation by any person other than the Brokers for
services rendered to Landlord in procuring this Lease.
11.4 Affiliates Defined."Affiliates"means with respect to a party:(a)that party's partners,co-members
and joint venturers,(b)each corporation or other entity that is a parent or subsidiary of that party,(c)each corporation
or other entity that is controlled by or under common control of a parent of such party,and(d)the directors,officers,
employees and agents of that party and each person or entity described in this§11.4(a-c).
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11.5 Survival of Waivers and Indemnities. Landlord's and Tenant's waivers and indemnities under
§11.2 and §11.3 will survive the expiration or early termination of this Lease.
12. CONDEMNATION
12.1 Taking."Taking" means acquiring of all or part of the Project for any public or quasi-public use
by exercise of a right of eminent domain or under any other law,or any sale in lieu thereof.
(a) Total Taking. If, because of a Taking, substantially all of the Premises are Untenantable for
substantially all of the remaining Term,then this Lease shall terminate on the date of the Taking.
(b) Partial Taking. If a Taking does not cause this Lease to be terminated under(a),then Landlord will
restore (and alter, as necessary) the Premises to a tenantable condition, unless this Lease is
terminated by either Landlord or Tenant under the following circumstances:
(1) Landlord may terminate this Lease upon sixty (60)days prior written notice to Tenant if
Landlord reasonably determines that it is uneconomical to restore or alter the Premises to
a tenantable condition.
(2) Tenant may terminate the Lease upon sixty (60) days prior written notice to Landlord if
the Taking causes more than twenty percent(2011/6)of the Premises to be Untenantable for
the remainder of the Term and Tenant cannot reasonably operate Tenant's business for the
Use in the remaining Premises.
(c) If the Lease is not terminated under(a) or(b), then the Rent will be reduced for the term of the
Taking based upon the RSF of the Premises made Untenantable by the Taking.
12.2 Awards. Landlord is entitled to the entire award for any claim for a taking of any interest in this
Lease or the Project, without deduction or offset for Tenant's estate or interest, and Tenant hereby waives all claims
for loss of impairment of its leasehold interest;however,Tenant may make a claim against the condemning authority
for relocation expenses and damages to Tenant's Personal Property and business to the extent that Tenant's claim does
not reduce Landlord's award.
13. TENANT TRANSFERS
13.1 Transfer Defined."Transfer"means any:
(a) Sublease of all or part of the Premises,or assignment,mortgage,hypothecation or other conveyance
of an interest in this Lease;
(b) Use of the Premises by anyone other than Tenant with Tenant's consent;
(c) Change in Tenant's form of organization (e.g., a change from a partnership to limited liability
company);
(d) Transfer of fifty one percent(51%)or more of Tenant's assets,shares(except shares transferred in
the normal course of public trading),membership interests,partnership interests or other ownership
interests;or
(e) Transfer of effective control of Tenant.
13.2 Consent Not Required. Upon notice to Landlord, but without Landlord's prior consent, Tenant
may effect a Transfer to a Permitted Transferee.A"Permitted Transferee"is any person or entity that meets all of
the following requirements and specifically excludes a Transfer pursuant to§13.1(c)above:
(a) The transferee(1)controls,is controlled by,or is under common control with Tenant(for purposes
hereof,"control"shall mean ownership of not less than fifty percent(50%)of all of the voting stock
or legal and equitable interest in the entity in question),(2)results from the merger or consolidation
of Tenant, or (3) acquires all or substantially all of the stock and/or assets of Tenant as a going
concern;
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(b) The transferee has a tangible net worth immediately following the Transfer not less than the greater
of(1) Tenant's tangible net worth immediately before the Transfer, or (2) Tenant's tangible net
worth as of the execution of this Lease;and
(c) The transferee's occupying the Premises will not cause Landlord to breach any other lease or other
agreement affecting the Project.
Additionally, Landlord acknowledges that Tenant collaborates with various contract partners and governmental
entities in the normal course of its business.Tenant shall have the right to enter into desk-sharing licenses with entities
with which it has a business relationship without the consent of Landlord. Such entities shall be permitted to utilize
the Premises as licensees of Lessee, and as such, shall not be subjected to any provisions relating to assignment and
subleasing in the Lease.
13.3 Consent Required. Each proposed Transfer, other than those permitted under §13.2, requires
Landlord's prior consent,which shall not be unreasonably withheld,delayed or conditioned,in which case the parties
will proceed as follows:
(a) Tenant's Notice.Tenant shall notify Landlord at least thirty(30)days prior to the proposed Transfer
of the name and address of the proposed transferee,the nature of the proposed Transfer(i.e.,sublease
or assignment) and the proposed use of the Premises, and include in the notice the Transfer
documents and, copies of any proposed assignee's balance sheets and income statements (both
current and for the past two[2]years).Unless in the instance of a full and complete release of Tenant
from the financial liability of the Lease,which determination shall be at Landlord's sole and absolute
discretion,Landlord shall not impose any financial requirement on any subtenant as a pre-condition
for Landlord's consent to any sublease.
(b) Landlord's Rights.Within ten(10)business days after receipt of Tenant's complete notice,Landlord
may:
(1) deleted.
(2) deleted.
(3) Consent or deny consent to the proposed Transfer; consent not to be unreasonably
withheld,delayed or conditioned,subject to all of the following being satisfied:
(A) Landlord determines, in Landlord's sole but reasonable discretion, that the
proposed assignee has the financial capacity to meet its obligations under the
proposed Transfer.Unless in the instance of a full and complete release of Tenant
from the financial liability of the Lease, which determination shall be at
Landlord's sole and absolute discretion,Landlord shall not impose any financial
requirement on any subtenant as a pre-condition for Landlord's consent to any
sublease;(B) The proposed use is consistent with the Use and will not cause
Landlord to be in breach of any lease,law or other agreement affecting the Project;
(C) The proposed transferee is typical of tenants that directly lease premises in first-
class office buildings;
(D) The proposed transferee is not a governmental or diplomatic entity;
(E) The proposed transferee is not named on the list of Specially Designated
Nationals and Blocked Persons maintained by the Office of Foreign Assets
Control of the United States Department of the Treasury or any such similar list
maintained by the state or federal government;
(F) The proposed transferee is not an existing tenant or an Affiliate of an existing
tenant, nor a party with which Landlord is actively negotiating to lease space in
the Building(nor has,in the last six[6]months,been actively negotiating to lease
space in the Building);and
(G) Tenant is not in default under this Lease which remains uncured.
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(c) CompellinR Consent, If Landlord does not consent to a Transfer, Tenant's sole remedy against
Landlord will be an action for specific performance or declaratory relief, and Tenant may not
terminate this Lease or seek monetary damages.
13.4 Payments to Landlord.Tenant shall pay Landlord one hundred percent(100%)of Transfer receipts
that exceed Tenant's Rent (on a per square foot basis); after Tenant is reimbursed for Tenant's reasonable and
customary out-of-pocket costs incurred in the Transfer, including attorneys' fees, Alterations, and broker
commissions.Tenant shall pay Landlord a$1,000.00 review fee for each proposed Transfer,excepting those in which
Landlord exercises its rights under subsection(1)or(2)of§I3.3(b).
13.5 Effect of Transfers.No Transfer releases Tenant or any guarantor of this Lease from any Lease
obligation.Except for transfers under§13.2,any transfer that is not consented to by Landlord pursuant to§13.3 shall
be void.Landlord's acceptance of a payment from any person or entity other than Tenant that occupies the Premises
does not waive Tenant's obligations under this Article 13,If Tenant is in default of this Lease,Landlord may proceed
against Tenant without exhausting any remedies against any transferee and may require (by written notice to any
transferee)any transferee to pay Transfer rent owed by Tenant directly to Landlord(which Landlord will apply against
Tenant's Lease obligations).Termination of this Lease for any reason will not result in a merger. Each sublease will
be deemed terminated upon termination of this Lease unless Landlord notifies the subtenant in writing of Landlord's
election to assume any sublease,in which case the subtenant shall attorn to Landlord under the executory terms of the
sublease.
13.6 Landlord acknowledges that Tenant collaborates with various contract partners and governmental
entities in the normal course of its business.Tenant shall have the right to enter into temporary desk-sharing licenses
for de minimus portions of the Premises with entities with which it has a business relationship without the consent of
Landlord. Such entities shall be permitted to utilize the Leased Premises as licensees of Lessee,and as such,shall not
be subjected to any provisions relating to assignment and subleasing in the Lease. Tenant shall not utilize the
provisions of this Section 13.6 as a subterfuge to avoid the Landlord consent requirements set forth herein above,e.g.,
entering into a so-called"desk-sharing" arrangement with a 3`a party for all or a substantial portion of the Premises
for the remainder of the Term of this Lease.
14. LANDLORD TRANSFERS
14.1 Landlord's Transfer. Landlord's right to transfer any interest in the Project or this Lease is not
limited by this Lease.Upon any such transfer,Tenant will attorn to Landlord's transferee and Landlord will be released
from liability under this Lease,except for any Lease obligations accruing before the transfer that are not assumed by
the transferee.
14.2 Subordination.This Lease is,and will at all times be,subject and subordinate to each ground lease,
mortgage, deed to secure debt or deed of trust now or later encumbering the Building, including each renewal,
modification, supplement, amendment, consolidation or replacement thereof(each, an"Encumbrance"); provided,
that concurrent with Landlord's execution of this Lease, Landlord shall provide Tenant with a subordination, non-
disturbance and attornment agreement("SNDA")in substantially the form and substance attached hereto as Exhibit
F from Landlord's current lender.At Landlord's request,Tenant will,without charge,promptly execute,acknowledge
and deliver to Landlord(or, at Landlord's request,the Encumbrance holder)any instrument reasonably necessary to
evidence this subordination. If the Tenant fails to execute or deliver any such instrument within five (5) days after
request, Tenant hereby irrevocably appoints and constitutes Landlord as Tenant's agent and attorney-in-fact for the
purpose of executing any such agreement and instrument for and on behalf of Tenant.Notwithstanding the foregoing,
each Encumbrance holder may unilaterally elect to subordinate its Encumbrance to this Lease.
14.3 Attornment.Tenant will automatically attorn to any transferee of Landlord's interest in the Project
that succeeds Landlord by reason of a termination, foreclosure or enforcement proceeding of an Encumbrance,or by
delivery of a deed in lieu of any foreclosure or proceeding(a"Successor Landlord"). In this event, the Lease will
continue in full force and effect as a direct lease between the Successor Landlord and Tenant on all of the terms of
this Lease,except that the Successor Landlord shall not be:
(a) Liable for any obligation of Landlord under this Lease, or be subject to any counterclaim, defense
or offset accruing before Successor Landlord succeeds to Landlord's interest;
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(b) Bound by any modification or amendment of this Lease made without Successor Landlord's
consent;
(c) Bound by any prepayment of more than one month's Rent;
(d) Obligated to return any Security Deposit not paid over to Successor landlord;or
(e) Obligated to perform any improvements to the Premises(or provide an allowance therefor). Upon
Successor Landlord's request, Tenant will, without charge, promptly execute, acknowledge and
deliver to Successor Landlord any instrument reasonably necessary or required to evidence such
attornment.
14.4 Estoppel Certificate. Within ten (10) business days after receipt of Landlord's written request,
Tenant (and each guarantor and transferee of an interest in the Lease) will execute, acknowledge and deliver to
Landlord a certificate upon which Landlord and each existing or prospective Encumbrance holder may rely confirming
the following(or any exceptions to the following):
(a) The Commencement Date and Expiration Date;
(b) The documents that constitute the Lease, and that the Lease is unmodified and in full force and
effect;
(c) The date through which Base Rent, Additional Rent, and other Rent has been paid and the then
current rates of same;
(d) That neither Landlord nor Tenant is in default of this Lease;
(e) That Landlord has satisfied all Lease obligations to improve the Premises (or provide Tenant an
allowance therefor)and Tenant has accepted the Premises;
(f) That Tenant solely occupies the Premises;
(g) The amount of any Security Deposit;
(h) Acknowledgment that the estoppel certificate can be relied upon by an Encumbrance holder;and
(i) Such other matters concerning this Lease or Tenant's occupancy that Landlord may reasonably
require.
Such estoppel certificate may be in the form set forth as the NLT in Exhibit C or such other form as required
by Landlord.
15. DEFAULT AND REMEDIES
15.1 Tenant's Default.Tenant is in default("Default")of this Lease if any of the following occur:
(a) Tenant fails to pay Rent when due,and the failure continues for five(5)days after notice to Tenant
of the failure.However,Tenant will only be entitled to three(3)notices in total of failure during any
Lease Year with respect to Base Rent and Additional Rent and if, after three (3) such notices are
given in any Lease Year, Tenant fails, during such Lease Year, to pay any Base Rent and/or
Additional Rent when due, such failure will constitute a Default without the requirement of further
notice by Landlord or additional cure period.
(b) Tenant fails to perform a non-monetary Lease obligation and the failure continues for five(5)days
after notice to Tenant of the failure,except that(1)in an emergency Landlord may require Tenant to
perform this obligation in a reasonable time of less than five (5) days, or (2) if Tenant begins
performing this obligation within five (5) days after notice to Tenant of this failure, but it will
reasonably take more than five(5)days to complete performing the obligation,then Tenant will have
a reasonable amount of additional time, not to exceed an additional sixty (60) days, to complete
performing the obligation. However, if such breach or noncompliance causes or results in (i) a
dangerous condition on the Premises or the Building,(ii)any insurance coverage carried by Landlord
or Tenant with respect to the Premises or Building being jeopardized,or(iii)a material disturbance
to another tenant,then a Default will exist if such breach or noncompliance is not cured as soon as
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reasonably possible after notice by Landlord to Tenant, and in any event is not cured within thirty
(30)days after such notice. For purposes of this §15.1(b),financial inability will not be deemed a
reasonable ground for failure to immediately cure any breach of, or failure to comply with, the
provisions of this Lease.
(c) Tenant consummates a Transfer that violates Article 13.
(d) Tenant fails to discharge any attachment or levy on Tenant's interest in this Lease within fifteen(15)
days after the attachment or levy encumbers this Lease.
(e) Tenant fails to cause any of the following proceedings to be vacated or dismissed within sixty(60)
days after they are commenced:(1)the appointment of a receiver or trustee of the assets of Tenant
or any guarantor of this Lease, (2) the voluntary or involuntary bankruptcy of Tenant or any
guarantor of this Lease, or(3)any assignment for the benefit of creditors of the assets of Tenant or
any guarantor of this Lease.
(f) Deleted.
(g) Tenant is named on the list of Specially Designated Nationals and Blocked Persons maintained by
the Office of Foreign Assets Control of the United States Department of the Treasury or any such
similar list maintained by the state or federal government.
15.2 Remedies. If any Default occurs,Landlord shall have the rights and remedies set forth in this Lease
which shall be distinct, separate and cumulative and shall not operate to exclude or deprive Landlord of any other
right or remedy allowed it by law or at equity.
(a) Landlord may proceed for past due Rent, reserving its right to proceed later for the remaining Rent
payments as they become due and,at Landlord's option,for specific performance and/or an injunction
requiring Tenant's performance of this Lease.
(b) Landlord may proceed for all past due installments of Rent,and declare all of the unpaid installments
of Base Rent and Additional Rent for the remainder of the Term at once due and payable,whereupon
this entire amount shall become and be due and payable within five(5) days notice by Landlord to
Tenant of such election, provided that as to Additional Rent, such aggregate will be calculated by
assuming that Expenses and Taxes for the calendar year in which the Default occurs and for each
subsequent calendar year remaining in the Term, will increase by five percent(5%) per year over
the amount of Expenses and Taxes for the prior calendar year.
(c) Landlord may terminate this Lease by giving notice to Tenant of Landlord's election to do so, in
which event the Term of this Lease shall end, and all right, title and interest of Tenant hereunder
shall expire, on the date stated in such notice. In no event shall either re-entry or the taking of
possession of the Premises by Landlord be construed as an election by Landlord to terminate this
Lease. Written notice alone shall be proof of any such election by Landlord. Upon such Lease
termination, Tenant shall surrender possession, vacate the Premises and immediately deliver
possession to Landlord in the condition required in this Lease. Landlord may, with due process of
law,re-enter and take possession of the Premises without being liable for prosecution for such action
or being deemed guilty of any manner of trespass, without diminishing any remedies for collection
of Rent,and without relinquishing any other right of Landlord,and Tenant will be and remain liable,
not only for all Rent due and other obligations incurred up to the date on which Landlord's termination
became effective and for all holdover damages that accrue under this Lease until Tenant vacates or is
removed from the Premises,but also for stipulated or liquidated damages for its nonperformance and
Landlord's loss of the bargain and not as a penalty in an amount equal to the sum of
(1) all Repossession Expenses,Reletting Expenses and Enforcement Costs that Landlord incurs;
plus;
(2) the greatest of(A)twelve(12)months of the Base Rent plus the Additional Rent then payable,
or(B)the Unamortized Initial Costs,or(C)the Landlord's Damages;plus
(3) interest at the Default Rate from the date such are incurred and/or the termination date,as
applicable,through the date of payment to Landlord.
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(d) Landlord may terminate Tenant's right to possession of the Premises without terminating this Lease
by giving written notice to Tenant that Tenant's right to possession shall end on the date stated in
such notice,and all right of Tenant to possession of the Premises or any part thereof shall cease on
the date stated in such notice. An election by Landlord to terminate Tenant's right to possession of
the Premises without terminating this Lease shall not preclude a subsequent election by Landlord to
terminate this Lease.
(1) Upon such termination of Tenant's right to possession of the Premises, Landlord may,with
due process of law,re-enter and take possession of all or any part of the Premises,without
additional demand or notice, and repossess the same and expel Tenant and any party
claiming by,through or under Tenant,and remove the effects of both,using such force for
such purposes as may be necessary,without being liable for prosecution for such action or
being deemed guilty of any manner of trespass,and without prejudice to any remedies for
arrears of Rent or right to bring any proceeding for breach of covenants or conditions.No
such reentry or taking possession of the Premises by Landlord will be construed as an
election by Landlord to terminate this Lease unless a written notice of such intention is
given to Tenant.No notice from Landlord or notice given under a forcible entry and detainer
statute or similar Laws will constitute an election by Landlord to terminate this Lease unless
such notice specifically so states.
(2) Landlord shall make commercially reasonable efforts to relet the Premises or portions
thereof, so as to mitigate Landlord's damages,to the extent required by applicable Law.
Landlord and Tenant agree that Landlord may relet for such term or terms and on such
conditions and other terms as Landlord, in its discretion, determines, and that Landlord
shall not be required to(A)observe any instructions given by Tenant about such reletting;
(B)lease the Premises prior to other space owned,controlled or managed by Landlord or
its Affiliates;or(C)lease the Premises at below market rates;
(3) Any rent received by Landlord from re-letting the Premises shall be deemed to reduce
Tenant's indebtedness to Landlord as follows: (A) first,to reduce Tenant's obligation to
reimburse Landlord for Repossession Expenses,then(B)to reduce Tenant's obligation to
reimburse Landlord for Reletting Expenses, then (C) to reduce Tenant's obligation to
reimburse Landlord for Unamortized Landlord Costs, then (D) to reduce Tenant's
obligation to Landlord for Enforcement Costs,then (E)to reduce Tenant's obligation for
the payment of Rent reserved in the Lease for the remainder of the stated Term of the
Lease.In no event shall Tenant be entitled to a reduction(of its indebtedness to Landlord)
in an amount in excess of the aggregate sum of Rent which would have been payable by
Tenant for the remainder of the stated Term of this Lease,as if no Default had occurred;
(4) Tenant shall pay to Landlord an amount equal to the Rent which would have been payable
by Tenant for the remainder of the stated Term of the Lease,less any applicable reductions
pursuant to§I5.3(d)(3)above as the same becomes due,without notice or demand;and
(5) Tenant shall,upon demand,reimburse Landlord,with interest at the Default Rate from the
date incurred through the date of payment to Landlord, the following: Repossession
Expenses;Reletting Expenses; Unamortized Landlord Costs and Enforcement Costs.
(e) Landlord may enforce the provisions of this Lease and may enforce and protect the rights of Landlord
by a suit or suits in equity or at law for the specific performance of any covenant or agreement
contained in this Lease,or for the enforcement of any other appropriate legal or equitable remedy,
including recovery of all monies due or to become due from Tenant under any of the provisions of
this Lease.
(f) Landlord may, but shall not be obligated to, cure Tenant's Default by making any payment or
performing such other act to the extent Landlord may deem desirable. Any such cure by Landlord
shall be without notice and shall not waive or release Tenant from any obligation under this Lease.
Tenant covenants and agrees to pay Landlord, upon demand, all advances, costs and expenses
incurred by Landlord in connection with such cure, including reasonable attorney's fees, together
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with interest at the Default Rate,from the date such are incurred by Landlord to the date of payment
to Landlord.
(g) Provided that Landlord performs its obligations to maintain and operate the Building as set forth in
this Lease, Landlord may, without liability to Tenant or any other party and without constituting a
constructive or actual eviction, suspend or discontinue furnishing or rendering to Tenant any
property, material, labor, or other service, including without limitation parking services but
excluding the services set forth in§§6.1(a)(1),(2),(4)and(6),so long as a Default exists under this
Lease.
(h) If Landlord exercises its rights pursuant to Sections 15.2(b)or 15.2(c) above,then alternatively,at
Landlord's option,Landlord will be entitled to recover from Tenant,as damages for loss of the bar-
gain and not as a penalty,an aggregate sum equal to:
(1) all unpaid Base Rent,Additional Rent and other Rent for any period prior to the termination
date or the repossession date,as the case may be(including interest from the due date to the
date of the award at the Default Rate described below), plus any other sum of money and
damages owed by Tenant to Landlord for events or actions occurring prior to the termina-
tion date or the repossession date,as the case may be,plus
(2) the present value at the time of termination or repossession as the case may be(calculated
at the rate commonly called the discount rate in effect at the Federal Reserve Bank of New
York on the termination date or the repossession date,as the case may be)of the amount,if
any,by which:
(A) the aggregate of the Base Rent, Additional Rent and all other Rent payable by
Tenant under this Lease that would have accrued for the balance of the Term after
termination or repossession as the case may be(with respect to Additional Rent,
such aggregate will be calculated by assuming that Expenses and Taxes for the
calendar year in which termination or repossession, as the case may be, occurs
and for each subsequent calendar year remaining in the Term if this Lease had not
been terminated or if Landlord had not repossessed the Premises,as the case may
be,will increase by five percent(5%)per year over the amount of Expenses and
Taxes for the prior calendar year),exceeds
(B) the amount of such Base Rent, Additional Rent and other Rent which Landlord
will receive for the remainder of the Term from any reletting of the Premises
occurring prior to the date of the award, or if the Premises have not been relet
prior to the date of the award,the amount, if any,of such Base Rent,Additional
Rent and other Rent which could reasonably be recovered by reletting the Prem-
ises for the remainder of the Term at the then-current Fair Market Rent, in either
case taking into consideration the Reletting Expenses,plus
(3) interest on the amount described in(2)above from the termination date or the repossession
date,as the case may be,to the date of the award at the Default Rate defined below_
15.3 Definitions.
(a) "Enforcement Costs"shall be all sums,costs,expenses and damages(in addition to Repossession
Expenses,Reletting Expenses, and Unamortized Landlord Costs)which are incurred by Landlord
in enforcing Tenant's obligations under this Lease or by reason of Tenant's Default, including
without limitation,those arising out of any action brought by Landlord against Tenant to interpret
any provision of this Lease or in connection with a bankruptcy or an assignment for the benefit of
creditors.
(b) "Fair Market Rent"shall be an amount equal to the fair market rental value of the Premises for the
remainder of the stated Term of this Lease, taking into consideration the Reletting Expenses
Landlord might incur upon reletting of the Premises.However,the Fair Market Rent shall be zero for
any period prior to the time at which Landlord could reasonably have been expected to have obtained
a new tenant for the Premises,and if Landlord has leased the Premises to a new tenant,then the rental
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payable by the new tenant will be deemed to be the Fair Market Rent for the Premises,and the period
between the termination of Tenant's possession under this Lease and the commencement of the new
lease will be deemed to be the time within which Landlord could reasonably have been expected to
have obtained a new tenant for the Premises.
(c) "Landlord Costs"shall be such concessions and expenses incurred by Landlord by or for Tenant
regarding this Lease prior to,or during the Term (including any renewals or extensions thereof),
including without limitation; (1)costs and expenses of improvements,remodeling,redecoration or
refurbishing of the Premises;(2)any and all allowance(s)paid,or credit given,for the improvement,
remodeling,redecoration or refurbishing of the Premises;(3)any free,excused or abated rent; and
(4)any broker's fee or other similar fee,sum or expense.
(d) "Landlord's Damages"shall be an amount equal to the present value of the amount by which the
Remainder Rent exceeds the Fair Market Rent for the remainder of the stated Term of this Lease.
The present value shall be computed on the basis of a discount rate equal to the then-current yield
on United States Treasury obligations having a maturity approximately equal to the remainder of
the stated Term of this Lease,as determined by Landlord.
(e) "Unamortized Landlord Costs"shall mean the amount remaining as of the date in question of the
Landlord Costs that have been amortized over the initial Term of the Lease at an interest rate often
percent(10%).
(f) "Reasonable attorneys' fees" shall include the value of services provided by counsel employed by
Landlord or its Affiliates in the amount that Landlord would have reasonably incurred if the services
had been performed by unaffiliated counsel.
(g) "Remainder Rent" shall be an amount equal to the aggregate Rent reserved in the Lease for the
remainder of the stated Term which would have been payable after the termination date had this
Lease not been terminated, including,without limitation,all Rent plus all increases pursuant to the
terms of this Lease.For the purpose of determining Remainder Rent only,Taxes and Expenses will
be deemed to increase at a rate of five percent(5%)annually.
(h) "Reletting Expenses"shall be such costs and expenses which Landlord may,to the extent deemed
necessary or desirable by Landlord, incur to relet the Premises, including without limitation, (1)
repairs,alterations and additions in or to the Premises,(2)altering locks and security devices to the
Premises, (3) redecorating, remodeling or refurbishing of the Premises, and (4) other costs and
expenses,including brokers' commissions and reasonable attorneys' fees.
(i) "Repossession Expenses" are such costs and expenses including, without limitation, reasonable
attorneys' fees which Landlord may incur, as Landlord considers appropriate, in order to recover
possession of the Premises.
15.4 interest. If Tenant at any time fails to make any payment of Rent or of any amounts owed under
this Lease, Landlord may recover interest on such amounts at the rate per annum equal to the lesser of the highest
interest rate permitted by law or eighteen percent(18%)("Default Rate"),from the date each amount is due until paid
by Tenant.
15.5 Waivers.
(a) If Tenant is in Default,Tenant expressly waives the service of any demand for the payment of
Rent, for the performance or nonperformance of any obligation or duty to perform or to
refrain from performing imposed upon Tenant under this Lease and the service of any and
every form of demand and notice prescribed by any statute or other law.
(b) Tenant expressly waives the right to trial by jury in any legal proceedings Landlord may
institute against Tenant to (1) recover possession of the Premises,and (2)collect delinquent
rent,whether or not the proceedings to collect delinquent rent are joined with proceedings to
recover possession of the Premises.
No waiver by Landlord of any Default of Tenant shall be implied to affect, and no express waiver shall affect, any
Default other than the Default specified in such waiver and that only for the time and to the extent stated.
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15.6 Force Majeure."Force Majeure"means any cause or event beyond both Landlord's and Tenant's
reasonable control, including any act of God, government act or restriction, labor disturbance, general shortage of
materials or supplies,riot,insurrection,or act of war or terrorism.Force Majeure excuses a party from performing any
non-monetary Lease obligation for a commercially reasonable time.
15.7 Landlord's Default and Remedies.
(a) Landlord will be in Default of this Lease if Landlord fails to perform any Lease obligation of
Landlord and this failure continues for thirty(30)days after Tenant notifies Landlord of such failure,
or such longer period of time as is reasonable if more than thirty(30)days is reasonably required to
perform this obligation; provided that performance commences within this thirty (30) day period
and is diligently prosecuted to completion.
(b) If Landlord is in Default, then Tenant may exercise any remedy available under law that is not
waived or limited under this Lease,subject to the following:
(1) Tenant may not terminate this Lease due to any Landlord Default until Tenant notifies each
Encumbrance holder and each Encumbrance holder is provided a reasonable opportunity
to gain legal possession of the Project and,after gaining possession,cure the Default.
(2) Landlord's liability under this Lease is limited to Landlord's interest in the Building.
(3) No liability under this Lease is assumed by Landlord's Affiliates.
16. SECURITY DEPOSIT
16.1 Deposit.Tenant will deposit the Security Deposit with Landlord on or before the Execution Date of
this Lease.Landlord is not required to either segregate the Security Deposit from any other funds or pay any interest
on the Security Deposit,The Security Deposit secures Tenant's performance of all Lease obligations. Landlord may
apply the Security Deposit against any cost Landlord incurs or damage Landlord suffers because Tenant fails to
perform any Lease obligation, including payment of Rent. Upon Landlord's demand, Tenant shall immediately
replenish any Security Deposit so applied.
16.2 Refund. If Tenant fully and faithfully performs all of its Lease obligations, then Landlord will
refund the Security Deposit(or any balance remaining)to Tenant within sixty(60)days after the expiration or early
termination of the Term and Tenant's vacation and surrender of the Premises to Landlord in the condition required by
§3.3. If Tenant has assigned this Lease,Landlord may return the Security Deposit to either Tenant or the then current
assignee. Landlord's transfer of the Security Deposit to any transferee of Landlord's interest in the Building relieves
Landlord of its obligations under this section, and Tenant will look solely to Landlord's transferee for return of the
Security Deposit.
17. MISCELLANEOUS
17.1 Rules and Regulations.Tenant will comply with the Rules and Regulations attached as Exhibit D.
Landlord may reasonably modify or add to the Rules and Regulations upon notice to Tenant. If the Rules and
Regulations conflict with this Lease,then the Lease shall govern.
17.2 Notice.Notice to Landlord must be given as follows:(a)all miscellaneous requests under this Lease,
including but not limited to work orders,overtime air,access cards,construction,maintenance,and other management
matters relating to the Property shall be sent to the Building Address; and (b)all notices required to be given to the
Landlord under this Lease shall be sent to the Notice Address,each as set forth in§1.1(m).Notice to Tenant must be
given to Tenant's Notice Addresses. By notice to the other,either party may change its Notice Address. Each notice
must be in writing and will be validly given if either:(w)the notice is personally delivered;(x)the notice is delivered
by a nationally recognized overnight courier service(e.g., FedEx or UPS)and delivery is acknowledged in writing;
(y)the notice is deposited in the US Mail as first-class,certified or registered mail,postage prepaid;or(z)the notice
is sent by email to a parry's email address set forth in Section L I(m)provided that the receipt of the email content can
be confirmed,with time of receipt being the uniform time the email enters the information processing system that the
recipient has designated or uses for the purpose of receiving email, and further provided that such notice shall be
deemed received and effective upon receipt at such email address irrespective of whether the addressee shall actually
open or read the email notice and/or attachments,then the notice will be deemed received by the party upon delivery
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as set forth in subsection (w), upon the acknowledged delivery as set forth in subsection (x),two(2)business days
after deposit in the US Mail as set forth in subsection(y)and upon the deemed receipt as set forth in subsection(z).
17.3 Deleted.
17.4 Building Name. Tenant shall not use the Building name or image or the name or image of any
complex in which the Building is located for any purpose,other than Tenant's address.Landlord may change the name
of the Building or any complex in which the Building is located without any obligation or liability to Tenant.
17.5 Entire Agreement.This Lease is deemed integrated and contains all of each party's representations,
waivers and obligations. The parties may only modify or amend this Lease in a writing that is fully executed and
delivered by each party.
17.6 Successors.Unless provided to the contrary elsewhere in this Lease,this Lease binds and inures to
the benefit of each parry's heirs,successors and permitted assignees.
17.7 No Waiver.A parry's waiver of a breach of this Lease will not be considered a waiver of any other
breach. No custom or practice that develops between the parties will prevent either party from requiring strict
performance of the terms of this Lease. No Lease provision or act of a party creates any relationship between the
parties other than that of landlord and tenant.
17.9 Independent Covenants. The covenants of this Lease are independent. A court's declaration that
any part of this Lease is invalid,void or illegal will not impair or invalidate the remaining parts of this Lease, which
will remain in full force and effect.
17.9 Captious.The use of captions, headings, boldface, italics or underlining is for convenience only,
and will not affect the interpretation of this Lease.
17.10 Authority.
(a) Individuals signing this Lease on behalf of Tenant represent and warrant that they are authorized to
bind Tenant to this Lease, and that Tenant is qualified to do business in the state in which the
Building is located.If required by Landlord.Tenant will,at Tenant's cost,provide Landlord with a
corporate resolution,opinion of counsel or other documentation acceptable to Landlord proving the
authority of each individual signatory to bind Tenant to this Lease.
(b) each party represents and warrants to the other Party that it is not named on the list of
Specially Designated Nationals and Blocked Persons maintained by the Office of Foreign
Assets Control of the United States Department of the Treasury or any such similar list
maintained by the state or federal government.
(c) Tenant represents and warrants to Landlord that any individual or entity involved in this
Lease transaction on behalf of Tenant,such as Guarantor and Tenant's Broker,is not named
on the list of Specially Designated Nationals and Blocked Persons maintained by the Office of
Foreign Assets Control of the United States Department of the Treasury or any such similar
list maintained by the state or federal government.
17.11 Applicable Law.The Laws of the state in which the Building is located govern this Lease. In any
action brought under this Lease,Tenant submits to the jurisdiction of the courts of the state in which the Building is
located and to venue in the County or Parish in which the Building is located.
17.12 Confidentiality. Tenant will not record this Lease or a memorandum of this Lease without
Landlord's written consent.Tenant will keep the terms of this Lease confidential and,unless required by law,may not
disclose the terms of this Lease to anyone other than Tenant's Affiliates to the extent necessary to Tenant's business.
17.13 Reasonableness. Tenant's sole remedy for any claim against Landlord that Landlord has
unreasonably withheld or unreasonably delayed any consent or approval shall be an action for injunctive or declaratory
relief.
17.114 Time.Time is of the essence as to all provisions in this Lease in which time is a factor.
17.15 Quiet Enjoyment.So long as Tenant is not in default of this Lease and except as provided in this
Lease,Landlord will not interfere with Tenant's peaceful and quiet enjoyment of the Premises for the Term.Landlord
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is not liable for,and Tenant will not be released from any obligation under this Lease because of any interference with
Tenant's peaceful and quiet enjoyment of the Premises that is caused by any other person,including other tenants.
17.16 Right to Enter Premises. Landlord may enter the Premises at any reasonable time to inspect the
Premises,to show the Premises to prospective lenders,purchasers or tenants;to perform Landlord's duties under this
Lease, to exercise Landlord's rights under §8.2 or to post notices of non-responsibility. In connection with any
permitted entry to perform Landlord's duties or exercise Landlord's rights under §8.2, Landlord may erect and use
structures reasonably required by the nature of the work(including scaffolding,pipes and conduits),and may open or
penetrate the Base Building or any Leasehold Improvements. If any Leasehold Improvements are damaged by
Landlord as a result of Landlord exercising its rights under this §17.16, then Landlord will repair or replace the
damaged portion,only,to match the original as nearly as is commercially reasonable.
17.17 Brokers. Landlord and Tenant represent and warrant that no broker or agent negotiated or was
instrumental in negotiating or consummating this Lease except the Brokers. Neither party knows of any other real
estate broker or agent who is or might be entitled to a commission or compensation in connection with this Lease.
Landlord will pay all fees,commissions or other compensation payable to the Brokers to be paid by Landlord accord-
ing to§1.1(n)and Tenant will pay all fees,commissions or other compensation payable to the Brokers to be paid by
Tenant according to§1.1(n).Tenant and Landlord will indemnify and hold each other harmless from all damages paid
or incurred by the other resulting from any claims asserted against either party by brokers or agents claiming through
the other party.The parties'obligations under this§17.17 will survive the expiration or early termination of the Term.
17.18 Warranties.Landlord and Tenant expressly agree that there are and shall be no implied warranties
of merchantability, habitability, suitability, fitness for a particular purpose or of any other kind arising out of this
Lease,all of which are hereby waived by Tenant,and that there are no warranties which extend beyond those expressly
set forth in this Lease.
17.19 Exhibits.The exhibits attached to this Lease are incorporated herein.Subject to§17.1,if any exhibit
is inconsistent with the terms of this Lease,the provisions of the Exhibit will govern.The Exhibits to this Lease are:
EXHIBIT A Location of Premises
EXHIBIT B Work Letter
EXHIBIT C Notice of Lease Term
EXHIBIT D Rules and Regulations
EXHIBIT E Parking
EXHIBIT F SNDA
EXHIBIT G Antenna Rights
18. RIGHT OF FIRST REFUSAL.
18.1 Grant of Option; Conditions.Tenant shall have the on-going right of first refusal (the "Right of
First Refusal")with respect to any available rentable space on the 16'Floor of the Building(the "Refusal Space").
Tenant's Right of First Refusal shall be exercised as follows: Landlord desires to lease the Refusal Space or any
portion(s) thereof to a bona fide prospective tenant, other than the existing tenant in the Refusal Space, (the "Pro-
spect") interested in leasing the applicable portion of the Refusal Space and Landlord and prospective tenant have
negotiated terms that Landlord is willing to accept, Landlord shall advise Tenant(the "Advice")of the terms under
which Landlord is prepared to lease the applicable portion of the Refusal Space to such Prospect and Tenant may lease
the applicable portion of the Refusal Space, under such terms,by providing Landlord with written notice of exercise
(the "Notice of Exercise") within 10 business days after the date of the Advice. Tenant shall be deemed to have
declined to exercise this Right of First Refusal if its notice of exercise is delayed or if the notice of exercise changes
any term or condition of the Advice.Notwithstanding what is set forth herein,Tenant shall have no such Right of First
Refusal and Landlord need not provide Tenant with an Advice if
(a) Tenant is in default under the Lease beyond any applicable cure periods at the time that Landlord
would otherwise deliver the Advice;or
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(b) more than fifty percent (50%) of the Premises is sublet (other than to a Permitted Transferee, as
defined in§13.02 of the Lease)at the time Landlord would otherwise deliver the Advice;or
(c) the Lease has been assigned(other than to a Permitted Transferee,as defined in§13.02 of the Lease)
prior to the date Landlord would otherwise deliver the Advice;or
(d) the Refusal Space is not intended for the exclusive use of Tenant or its customers or business
partners during the Term;or
(c) the"'tenant is not occupying the Premises on the date Landlord would otherwise deliver the Advice_
18.2 Terms for Refusal Space.
(a) The term for the Refusal Space shall commence upon the commencement date stated in the Advice
and thereupon such Refusal Space shall be considered a part of the Premises, provided that all of
the terms stated in the Advice shall govern Tenant's leasing of the Refusal Space and only to the
extent that they do not conflict with the Advice the terms and conditions of the Lease shall apply to
the Refusal Space. Tenant shall pay Base Rent and Additional Rent for the Refusal Space in
accordance with the terms and conditions of the Advice and the expiration date shall be the date set
forth in the Advice.
(b) The Refusal Space(including improvements and personalty, if any)shall be accepted by Tenant in
its condition and as-built configuration existing on the earlier of the date Tenant takes possession of
the Refusal Space or the date the term for such Refusal Space commences. If Landlord is delayed
delivering possession of the Refusal Space due to the holdover or unlawful possession of such space
by any party, Landlord shall use reasonable efforts to obtain possession of the space, and the
commencement of the term for the Refusal Space shall be postponed until the date Landlord delivers
possession of the Refusal Space to Tenant free from occupancy by any party.Tenant shall be entitled
to a pro-rata abatement and(adjusted for size)Construction Allowance for the Refusal Space which
shall be calculated by multiplying the Construction Allowance set forth in Section 1(r)above by a
fraction whose numerator shall be the number of months then remaining in the initial Term and
whose denominator shall be one hundred thirty two(132).The Lease Commencement Date shall be
the date that is the earlier of 1.)beneficial occupancy("open for business"and five months after the
signed lease amendment and Tenant's vacant possession of the Refusal Space.
18.3 Termination of Right of First Refusal.
(a) If this Right of First Refusal is declined or is not exercised by Tenant,then for the next one hundred
eighty(180)days Landlord shall have the right to lease that portion of the Refusal Space set forth
in the Advice to a third party on materially the same terms as those offered to Tenant.If at the end
of such one hundred eighty(180) day period Landlord has not entered into a lease with any third
party on materially the same terms as those offered to Tenant,then the Refusal Space shall again be
subject to this Right of First Refusal.Notwithstanding what is set forth herein, this Right of First
Refusal shall terminate on the date three(3)years prior to Expiration Date. "Materially the same
terms" shall mean a net effective rent that is not more than ten percent(10%) lower than the terms
offered to Tenant.If during the above one hundred eighty(180)day period Landlord makes an offer
to a third party for the Refusal Space that is not on materially the same terms as those offered to
Tenant,then Landlord must offer said terms to Tenant pursuant to this Right of First Refusal.
(b) In addition, if Landlord provides Tenant with an Advice for any portion of the Refusal Space that
contains expansion rights(whether such rights are described as an expansion option,Right of First
Refusal, right of first refusal or otherwise) with respect to any other portion of the Refusal Space
(such other portion of the Refusal Space subject to such expansion rights is referred to herein as the
"Encumbered Refusal Space")and Tenant does not exercise its Right of first Refusal to lease the
Refusal Space described in the Advice, Tenant's Right of First Refusal with respect to the
Encumbered Refusal Space shall be subject and subordinate to all such expansion rights contained
in the Advice.
18.4 Refusal Space Amendment. If Tenant exercises its Right of First Refusal,Landlord shall prepare
an amendment(the"Refusal Space Amendment")adding the Refusal Space to the Premises on the terms set forth in
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the Advice and reflecting the changes in the Base Rent,Rentable Square Footage of the Premises,Tenant's Share and
other appropriate terms. A copy of the Refusal Space Amendment shall be sent to Tenant within a reasonable time
after Landlord's receipt of the Notice of Exercise executed by Tenant,and Tenant shall execute and return the Refusal
Space Amendment to Landlord within thirty(34)days after receipt of the amendment,but an otherwise valid exercise
of the Right of First Refusal shall be fully effective whether or not the Refusal Space Amendment is executed.
18.5 Subordination.Notwithstanding anything herein to the contrary,Tenant's Right of First Refusal is
subject and subordinate to(a)the renewal or extension of the lease term of any tenant leasing all or any portion of the
Refusal Space(whether by exercise of option or otherwise); (b)the expansion rights(whether such rights are desig-
nated as a Right of First Refusal,right of first refusal,expansion option or otherwise,regardless)of any tenant of the
Building existing on the date hereof(including Pier One Imports current or future expansion rights in the Building);
and (c) the right of Landlord to lease the space to any other tenant or tenant prospect who by the inclusion of the
Refusal Space will occupy more space in the Building than Tenant.
18.6 MlSCO112neOUS. If Tenant leases the Refusal Space under this Right of First Refusal, Tenant shall
have the right to extend the term of the Lease for Refusal Space upon the same terms and conditions as set forth in
Extension Option set forth in§3.4 above.Time is of the essence of this Right of First Refusal.
[SIGNATURES TO IMMEDIATELY FOLLOW1
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Having read and intending to be bound by the terms and provisions thereof, Landlord and Tenant have
executed this Lease as of the Execution Date.
TENANT LANDLORD
PAE APPLIED TECHNOLOGIES LLC, Hertz Fort Worth Energy Way, LP
a Delaware Limited Liability Company, a Delaware limited partnership
By: Hertz Fort Worth Energy Way Manager,LLC
a Delaware limited liability company,
its General Partner
By: Hertz Fort Worth Energy Way Manager,
Inc.,a Delaware corporation,its Manager
Name: �--
.� .
Title; By: C� ' I
Name: M;.I..0 I C . Afar74w%
Title Vc,e Arv;,J.-%t • Asst BMf
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EXHIBIT A - FLOOR PLAN DELINEATING THE PREMISES
Suite #1500
50 DEPT Ce!DEn
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31
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A-1
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EXHIBIT B —WORK LETTER
Suite #1500
I. Conflicts;Terms. If there is any conflict or inconsistency between the provisions of the Lease and those of
this Exhibit 13("Work Letter"),the provisions of this Work Letter will control. Except for those terms expressly defined in
the Work Letter,all initially capitalized terms will have the meanings stated for such terms in the Lease.The following terms,
which are not defined in the Lease,have the meanings indicated:
(a) "Scheduled Commencement Date" means the date set forth in Subsection 1.1(h) of the Lease,unless the
Scheduled Commencement Date is extended according to Paragraph 2 of this Work Letter.
(b)"Start Date" means the first day of the Tenant Finish Period, which will be the date of Landlord's final
approval of the Construction Documents,unless the Start Date is extended according to Paragraph 2 of this Work Letter,
(c) "Tenant Finish Period" means the period beginning on the Start Date and ending on the Commencement
Date.
(d)"Submission Date" means at least thirty (30) days prior to the start of Construction, but not later than the
date of Tenant's execution of this Lease.
(e) "Landlord's Representative"shall be designated upon final execution of this Lease
(f) "Tenant's Representative" shall be designated upon Landlord's request.
(g) "Tenant's Architect" means such licensed or registered professional architect,designer or space planner as
may be selected by Tenant and reasonably approved by Landlord.
(h) "Tenant's Engineers"means such licensed or registered professional engineers as may be selected by Tenant
and reasonably approved by Landlord.
(i) "Tenant improvements" means all Tenant Improvements to be constructed or installed by Tenant in the
Premises according to this Work Letter as further defined in Paragraph 8 of this Work Letter.
0) "Preliminary Plans" means space plans and general specifications for the Tenant Improvements prepared
by Tenant's Architect in such form(and on such scale in the case of plans and drawings) as Landlord may reasonably
specify.
(k) "Construction Documents" means complete construction plans and specifications for the Tenant Improve-
ments prepared by Tenant's Architect and Tenant's Engineers in such form(and on such scale in the case of plans and
drawings)as Landlord may reasonably specify and detailing all aspects of the Tenant Improvements,including,without
limitation,the location of libraries, safes and other heavy objects,stairwells, walls, doors, computer equipment, tele-
phone and related equipment,and electrical, plumbing,heating,ventilation and air conditioning equipment(including
equipment in excess of that required for normal use), Tenant's Engineers will perform all mechanical and electrical
design work included in the Construction Documents.
(1) "Tenant's Costs" means all costs required to be expended by Tenant under this Work Letter in connection
with the Tenant Improvements,including,without limitation,the costs of preparing the Preliminary Plans,Construction
Documents and the as-built plans described in Paragraph 7 of this Work Letter;performing the Tenant Improvements;
obtaining all required electrical and telephone panels and/or meters, signage, cabling, wiring(but not including tele-
communications systems)and Landlord's services and the Tenant Improvement Construction Administration Fee pro-
vided under Paragraph 13 of this Work Letter.Tenant shall have the right to utilize the Tenant Improvement Allowance
for hard and soft costs, a monument sign, as well as any costs relating to Tenant's occupancy of the Initial Premises.
Any unused allowance may be utilized as credit against base rent.
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(m) "Construction Allowance" that amount set forth in Section I.I(s)of the Lease.
(n) "Amortized Allowance"means that, upon Tenant election, if Tenant's Costs exceed the Construction
Allowance,upon Tenant's written request,Landlord shall fund the differential,and such differential shall be amortized
over the initial Term at an interest rate of six percent(6%)per annum on a straight-line basis,and the resulting monthly
amount shall be added to the Base Rent otherwise payable under this Lease.
(o) "Test Fit Allowance"means an amount equal to fifteen cents($0.15)per RSF within the Premises,which
Landlord shall reimburse to Tenant within thirty(30)days of receipt of Tenant's invoice and supporting documentation,
to reimburse Tenant for part of the costs of developing a so-called"test fit"floor plan of the Premises.
2. Tenant Finish Period;Commencement Date.The Tenant Finish Period will begin on the Start Date,unless
the Start Date is extended according to the following provisions. If on or before the Start Date,Tenant has not been permitted
entry to the Premises for the installation of the Tenant Improvements,then the Start Date will be extended until the date on
which Tenant is permitted entry to the Premises for the conduct of the Tenant Improvements and the Scheduled Commencement
Date will be extended for an equivalent period of time.Such postponement of the Start Date and the Scheduled Commencement
Date(and therefore the postponement of the commencement of the Term), will be in full settlement of all claims that Tenant
might otherwise have against Landlord by reason of Landlord's failure to deliver the Premises.
3. Representatives.Landlord appoints Landlord's Representative to act for Landlord in all matters covered by
this Work Letter. Tenant appoints Tenant's Representative to act for Tenant in all matters covered by this Work Letter. All
inquiries, requests, instructions, authorizations and other communications with respect to the matters covered by this Work
Letter will be made to Landlord's Representative or Tenant's Representative, as the case may be. Tenant will not make any
inquiries of or requests to, and will not give any instructions or authorizations to, any other employee or agent of Landlord,
including Landlord's architect, engineers and contractors or any of their agents or employees, with regard to matters covered
by this Work Letter. Either party may change its Representative under this Work Letter at any time by prior written notice to
the other party.
4. Possession;Condition.Landlord will deliver the Premises to Tenant for the conduct of the Tenant Improve-
ments on the Start Date or as soon after such date as possible. Regardless of Landlord's delivery of the Premises to Tenant,
Tenant will not be permitted to begin the installation of the Tenant Improvements unless and until Landlord has approved the
Construction Documents according to Paragraph 7 of this Work Letter,Tenant has obtained all necessary permits for the Tenant
Improvements according to Paragraph 8 of this Work Letter and Tenant is otherwise in compliance with the provisions of this
Work Letter.Tenant acknowledges and agrees that,as of the date of the Lease,the Premises are in good order and satisfactory
condition.Tenant will accept the Premises upon Landlord's delivery in an"as is" condition,except for any latent defect in the
Building Structure or Mechanical Systems of which Tenant notifies Landlord within one year after the Commencement Date.
No promise to alter, remodel or improve the Premises or Building and no representations concerning the condition of the
Premises or Building have been made by Landlord to Tenant other than as may be expressly stated in the Lease(including this
Work Letter). All alterations, improvements and additions made to the Premises according to this Work Letter will, without
compensation to Tenant,become Landlord's property upon installation and will remain Landlord's property at the expiration or
earlier termination of the Term.
5. Early Access.Landlord may,in its discretion,permit Tenant to enter the Premises prior to the Start Date so
that Tenant may do such work as may be required to prepare the Premises for the Tenant Improvements. if Landlord permits
such entry prior to the Start Date,Tenant will not interfere with the performance of any work by Landlord,or with the work of
any other tenant or occupant.If at any time such access causes or threatens to cause disharmony or interference,including labor
disharmony,Landlord will have the right to immediately withdraw such permission.At all times while Tenant is in occupation
of the Premises prior to the Commencement Date (including the Tenant Finish Period), Tenant will be subject to and will
comply with all of the terms and provisions of the Lease,except that no Base Rent or Additional Rent will be payable by Tenant
prior to the Commencement Date.
6. Landlord's Approval. All Preliminary Plans and Construction Documents, and any revisions to the same
(whether in the form of a change order or otherwise)are expressly subject to Landlord's prior written approval.Landlord may
withhold its approval of any such items that require work which:
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(a) exceeds or adversely affects the capacity or integrity of the Building Structure or Mechanical Systems;
(b) is not approved by the holder of any Encumbrance;
(c) would not be approved by a prudent owner of property similar to the Building;
(d) violates any agreement which affects the Building or binds Landlord;
(e) Landlord reasonably believes will increase the cost of operating or maintaining any of the Mechanical
Systems;
(f) Landlord reasonably believes will reduce the market value of the Premises or the Building at the end of
the Term;
(g) does not conform to applicable building code or is not approved by any governmental authority having
jurisdiction over the Premises;
(h) does not meet or exceed Building Standard;or
(i) Landlord reasonably believes will infringe on the architectural or historical integrity of the Building.
7. Tenant's Plans.On or before the Submission Date,Tenant, at its expense,will cause the Preliminary Plans
to be prepared and submitted to Landlord for its approval. Such submittal will include one(1)complete full size set and one
(1)electronic file in Auto CAPD 2004 format(or such other updated version agreed to by Owner and Consultant,herein called
an "Electronic Copy").If the submitted materials are not acceptable to Landlord,Landlord will so notify Tenant by returning
the sepia with required changes noted.If Landlord so notifies Tenant of any required change to the Preliminary Plans,Tenant
will cause the same to be revised according to the returned plans and resubmitted to Landlord within seven(7)days after receipt
of such notice.Within fifteen(60)days after Landlord notifies Tenant of Landlord's approval of the Preliminary Plans,Tenant,
at its expense,will cause the Construction Documents to be prepared and submitted to Landlord for its approval.Such submittal
will include one(1)complete full size set and one(1)Electronic Copy and a complete color and finish board for Tenant's Work.
The Construction Documents must strictly conform to the Preliminary Plans approved by Landlord and must be in all respects
sufficient for the purpose of obtaining a building permit for Tenant's Work. If required by Landlord, Tenant will cause the
Construction Documents to be resubmitted to Landlord for its approval within seven(7)days after Landlord notifies Tenant of
any required changes.Tenant's Work will not commence prior to Landlord's approval of the Construction Documents. If the
Landlord fails to deliver to Tenant Landlord's written approval or its written request for revisions within fifteen(15)days after
Landlord receives any required revisions to them,Tenant will receive a credit against Base Rent beginning on the Commence-
ment Date equal to one day's Base Rent for each day subsequent to the fifteenth(15th) day after Tenant's submittal until the
day of Landlord's response. Except as provided in Paragraph 2 of this Work Letter,no delays in the design or performance of
Tenant's Work will change the Start Date or the Commencement Date.Upon completion of Tenant's Work,Tenant will provide
Landlord an Electronic Copy of as-built plans of the Premises.If Tenant fails to provide such plans,Landlord may obtain them,
directly or by field verification,and charge Tenant for all costs incurred by Landlord in doing so.No approval by Landlord of
the Preliminary Plans, the Construction Documents or any revisions to them will constitute a representation or warranty by
Landlord as to the adequacy or sufficiency of such plans, or the improvements to which they relate, for any use,purpose or
condition,but such approval will merely be the consent of Landlord to the construction or installation of improvements in the
Premises according to such plans.
S. Tenant Improvements. During the Tenant Finish Period,Tenant,at its expense, will construct or cause to
be constructed in the Premises all work necessary to bring the Premises into a first class condition consistent with the use
specified in the Lease,according to the Construction Documents approved by Landlord ("Tenant Improvements"). Tenant,
at its expense,will obtain.(a)all permits(including,without limitation,building permits)required under this Work Letter and
(b)all certificates required for occupancy of the Premises from the appropriate governmental authorities.Tenant will cause all
of the Tenant Improvements to be diligently completed in a good and workmanlike manner,according to the approved Con-
struction Documents and all applicable laws,and free and clear of any liens or claims for liens.
9. Tenant's Contractors and Preferred Vendors.Landlord will have the right to approve Tenant's contractor
("Contractor")and all subcontractors,which approvals will not be unreasonably withheld or delayed. Landlord will provide
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Tenant with a list of contractors and subcontractors that are acceptable to Landlord. Tenant may select its Contractor and
subcontractors from such list or may request Landlord's approval of a Contractor and subcontractors not on such list.Tenant
will not execute any contract for the performance of the Tenant Improvements until Landlord's approvals of the Contractor and
subcontractors have been obtained, and Tenant will cause its proposed Contractor and subcontractors (if not on such list)to
submit such information, including financial information, as may be reasonably required by Landlord to determine whether
such Contractor and subcontractors should be approved. Additionally, Landlord has established relationships with various
vendors who can provide certain products at a significant discount("Preferred Vendors")to market prices,and will provide
Tenant with a list of same.Tenant has the option to obtain bids from such Preferred Vendors for products required in connection
with the performance of the Tenant Improvements, ,Tenant has the option to utilize Landlord's Preferred Vendors to supply
such products.
10. Construction Contract.Tenant's construction contract for the Tenant Improvements will provide(and Ten-
ant will deliver a copy of it to Landlord so that Landlord may confirm it provides)that: (a) construction of the Tenant Im-
provements will not interfere with Landlord's or Landlord's tenants' activities in, or use or enjoyment of, the Building; (b)
Contractor will cooperate with other contractors in the Building to insure harmonious working relationships,including,without
limitation,coordinating with other contractors in the Building concerning use of elevators,trash removal and water and utility
usage; (c) Contractor will leave all Common Areas in neat, clean, orderly and safe condition at the end of each day during
construction of the Tenant Improvements; (d) Contractor will procure and maintain and cause its subcontractor(s)to procure
and maintain the insurance described in Paragraph l I below;(e)upon completion of the Tenant Improvements and as a Tenant
Cost, Contractor will provide to Landlord and Tenant as-built drawings consisting of two hard copy sets of bluelines and an
electronic file in a format compatible with Landlord's computer aided design software, together with mechanical balance
reports and any maintenance manuals on equipment installed in the Premises as part of Tenant's Work; and(f) all labor and
material supplied according to the contract will be fully warranted by Contractor for a period of not less than one year from
substantial completion of the Tenant Improvements and such warranty will provide that it is for the benefit of both Landlord
and Tenant and may be enforced by either. The construction contract will also contain the following indemnification and de-
fense provision,or the substantive equivalent there of
"Contractor will protect,defend,hold harmless,and indemnify[Landlord's name to be inserted]and its successors,as-
signs, directors, officers and employees(collectively, "Indemnitees") from and against all claims, actions, liabilities
damages losses,cost and expense(including attorney's fees)arising out of or resulting from the performance of the work
contemplated by this contract by Contractor or any of its subcontractors,provided that any such claims,action,liabilities,
damages, losses,cost or expense(a)are attributable to bodily injury, sickness, disease,or death,or to injury to or de-
struction of tangible property(other than the work contemplated by this contract itseto including the loss of use resulting
therefrom and(b)are caused in whole or in part by the negligent act or omission of Contractor,any subcontractor,or any
of them may, directly or indirectly, be liable. Such obligations will not be construed to negate, abridge or otherwise
reduce any other right or obligation of indemnity which would otherwise exist as to any party or person described in this
paragraph.
Contractor agrees to protect,defend,hold harmless and indemnify the Indemnitees from and against any and all claims,
actions,liabilities,damages,losses,costs,and expenses(including attorneys'fees)arising out of or resulting from Con-
tractor's failure to purchase all insurance required under Paragraph 11 of the Workletter attached to and made a part of
the Lease Agreement dated[Date of Lease to be inserted]between Landlord's name to be inserted]and[Tenant's name
to be inserted],and Contractor's failure to require and obtain proper insurance coverage from its subcontractors.In any
and all claims against the Indemnitees or employee of Contractor or any subcontractor, anyone directly or indirectly
employed by any of them or anyone for whose acts any of them may be liable,the indemnification obligation under this
provision will not be limited in any way be any limitation of the amount or type of damages,compensation or benefits
payable by or for Compensation Acts,disability benefit acts,or other employee benefit acts.The indemnification and
defense obligations stated above will not apply to any claims,actions,liabilities,damages,losses,cost or expenses caused
directly and solely by the affirmative gross negligence or intentional tortious act of the Indemnities."
11. Contractor's Insurance. Tenant will cause Contractor (and, except as provided below, all of Contractor's
subcontractors) to procure and maintain in effect during the entire period of construction of the Tenant Improvements the
following insurance:
(a) Worker's compensation insurance with statutory benefits and limits which fully comply with all state and
federal requirements;
(b) Employer's liability insurance with limits of not less than$200,000;
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(c) Automobile liability insurance including owned,non-awned,leased and hired car coverage,naming Landlord
as an additional insured,providing primary(and not contributing)coverage, and containing cross-liability and severability of
interest clauses;limits of contract for the performance of the Tenant improvements is$150,000 or less,coverage will be in an
amount of not less than $1,000,000 combined contract is over S150,000, coverage will be in an amount of not less than
$2,000,000 combined single limit per occurrence;
(d) Comprehensive general liability insurance including personal injury,owner's and contractor's protective lia-
bility, explosion, collapse and underground damage liability endorsement (commonly called X, C and U hazard), products,
completed operations, blanket contractual and broad form property damage coverage, naming Landlord as an additional in-
sured, providing primary (and not contributing) coverage, and containing cross-liability and severability of interest clauses;
limits of liability will be as follows:if the total amount of Contractor's contract for the performance of the Tenant Improvements
is$150,000 or less,coverage will be in an amount of not less than$2,000,000 combined single limit per occurrence;if the total
amount of Contractor's contract is over$150,000,coverage will be in an amount of not less than$5,000,000 combined single
limit per occurrence;and
(e) "Ail risk" builders risk property insurance for the full replacement cost of the Tenant Improvements on a
completed value basis,naming Landlord as a loss payee, as its interest may appear,providing primary(and not contributing)
coverage,and including a waiver of all rights of subrogation against Landlord.
All of the above insurance policies must be placed with insurance companies reasonably acceptable to Landlord and must be
endorsed to require thirty(30)days'written notice to Landlord prior to any cancellation or material changes in coverage.Prior
to the commencement of any Tenant improvements,Tenant will cause Contractor to deliver to Landlord original certificates
of insurance evidencing the insurance coverage required above.Tenant will also cause Contractor to deliver to Landlord orig-
inal certificates of insurance evidencing the insurance coverage required above. Tenant will also cause Contractor to obtain
certificates or evidence of similar insurance from each of Contractor's subcontractors before their work commences and deliver
such certificates or evidence to Landlord. Each subcontractor must be covered by insurance of the same character and in the
same amount as specified for Contractor above,except that(i)a subcontractor's comprehensive general liability insurance will
have combined single limits not less than $2,000,000 per occurrence, if the total amount of Contractor's contract for the per-
formance of The Tenant Improvements is$150,000 or less,and not less than$5,000,000 per occurrence,if the total amount of
Contractor's contract is over$150,000 and(H)so long as Contractor's builders risk policy covers all of the Tenant Improve-
ments,no subcontractor will be required to maintain builders risk insurance.Contractor and Landlord may agree to lesser limits
in writing because of the nature of the particular subcontract work.
12. Additional Requirements Concerning Tenant Improvements,The following additional requirements will
apply to the Tenant Improvements:
(a)All of Tenant's Work will be:(1)of a quality at feast equal to Building Standard;(2)completed only accord-
ingto the Construction Documents approved by Landlord;(3)conducted in a manner so as to maintain harmonious labor
relations and not to interfere with or delay any other work or activities being carried on by Landlord or Landlord's
contractors or other tenants;(4)designed,performed and completed in substantial compliance with all applicable stand-
ards and regulations established by Landlord and provided to Tenant in advance of the commencement of construction
of Tenant's Work as well as all safety, fire, plumbing and electrical and other codes and governmental and insurance
requirements;(5)completed only by the Contractor approved by Landlord;(6)coordinated by the approved Contractor
so as to insure timely completion; and (7) performed and conducted in such a manner so as not to alter the Building
Structure or Mechanical System.
(b)Under no circumstances will Tenant,Contractor or any of their authorized representatives ever alter or mod-
ify or in any manner disturb any portion of the Mechanical System. Only with Landlord's express written permission
will Tenant, Contractor or their authorized representatives alter or modify or in any manner disturb any Branch (as
defined below)of any Central portion(as defined below)of any Mechanical System which serves or is located within
the Premises. "Central' means that portion of any Mechanical System which is within the core of the Building or the
core of the Mechanical system or that is common to or serves or exists for the benefit of other tenants in the Building,
and "Branch" means that portion of any Mechanical System which serves to connect or extend Central system to the
Premises.Any and all interfacing with,or tie-ins to,any Central Mechanical System or Branches will be scheduled with
Landlord not later than five(5)days prior to the commencement of any such work. Any such interfacing with,or tie-
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ins to,any such Mechanical System or Branches,and any checks of such interfacing or tie-ins,will be performed only
after the same have been scheduled with,and approved by,Landlord.
(c) Contractor may submit to Landlord written request for use of any Building Standard materials which have
been pre-stocked by Landlord. Any such request will indicate the quantity and description of the pre-stocked materials
needed.Contractor will be responsible for the relocation and allocation of any such materials to the Premises under the
supervision of, and only with the consent of, Landlord's Representative or contractor. Contractor will be solely and
exclusively responsible for signing for and verifying any such pre-stocked materials so used.Tenant will pay Landlord
as a part of Tenant's Costs the value of any pre-stocked materials so requested by Contractor from Landlord.The value
of any such pre-stocked materials will be determined by the quantities required in accordance with generally accepted
costs in the metropolitan area in which the Building is located.
(d)All construction personnel engaged in the performance of the Tenant Improvements must use the Building's
freight elevator and not the passenger elevators for access to the Premises.All deliveries of materials for use in connec-
tion with the construction of the Tenant Improvements requiring the freight elevator of the Building must be scheduled
in advance with landlord.In addition,any of the Tenant Improvements which are to be are to be performed during hours
other than Business Hours must be scheduled in advance with Landlord.
(e) Tenant agrees that if Contractor fails to leave all Common Areas in a neat,clean,orderly and safe condition
at the end of each day during construction of the Tenant Improvements, Landlord will have the right to immediately
take such action as Landlord deems appropriate to render the Common Areas neat,clean,orderly and safe and Tenant
will,upon Landlord's written demand,reimburse Landlord for all Landlord's costs of taking such action.
13. Landlord's Services; Construction Administration. During construction of the Tenant Improvements,
Landlord will provide the following services related to such construction,the cost of which will be paid by Landlord all elec-
tricity and other utilities; and the following costs that will be paid by Tenant as a part of Tenant's Costs: refuse removal (in-
cluding dumpsters),and any other services requested by Tenant or Contractor that Landlord agrees to provide(such as engi-
neering,maintenance or housekeeping services).In addition,Landlord will provide construction administration with respect to
the Tenant Improvements and Tenant shall pay to Landlord a construction administration fee equal to one percent(I%)of the
cost of the Tenant Improvements ("Tenant Improvement Construction Administration Fee"). All Tenant's Costs that are
payable to Landlord will be paid by Tenant within ten(10)days business after the date of Landlord's invoice.
14. Inspection;Stop Work;Non-complying Work.Landlord reserves the right to inspect the Tenant Improve-
ments in the Premises at all reasonable times,provided that such inspection(s) will in no way make Landlord responsible for
any of the Tenant Improvements and will not constitute a representation or warranty by Landlord as to the adequacy or suffi-
ciency of the Tenant Improvements. Landlord reserves the right to stop any and all work performed (or to be performed) if
Landlord considers any such work,or its performance,to be dangerous or creating a nuisance,or otherwise injurious to Tenant,
Landlord or any other Building tenants.If any inspection by Landlord reveals any items of the Tenant Improvements that does
not comply with Tenant's obligations under this Work Letter, Landlord may so notify Tenant and require that the item be
corrected to so comply. Within ten(10)days after the date of any such notice from Landlord,Tenant will begin correction of
any such non-complying item and will then promptly and diligently pursue such correction to completion.If any such item is
not so corrected,Landlord may enter the Premises at any time and correct the item at Tenant's expense(to be paid by Tenant
promptly upon demand).
15. Mechanics' Liens. In the conduct of the Tenant Improvements,Tenant will take all action necessary to en-
sure that no mechanic's or other liens attach to the Premises or Building.Without limitation,Tenant will post notices,with form
and content and in the manner as specified by any applicable law, notifying all persons or entities which may supply labor or
materials in connection with the Tenant Improvements that Landlord's interest in the Premises and Building will not be subject
to any lien for the same.If any such lien should be filed,the provisions of Section 8.3 of the Lease will apply.
16. Payment of Construction Allowance. Landlord agrees to pay Tenant the Construction Allowance, to be
applied to the cost of designing and performing the Tenant Improvements, in progress payments after the commencement of
the Tenant Finish Period. Tenant shall not pay costs for the Tenant Improvements until Tenant Improvement Allowance, if
applicable, is fully funded by Landlord. Such progress payments will be made not later than thirty(30) days after receipt by
Landlord from Tenant of copies of Tenant's paid invoices from Contractor(and, where applicable, copies of Contractor's in-
voices from its subcontractors or suppliers)together with a certificate from Tenant's Architect(or other evidence satisfactory
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to Landlord) indicating that the work to which such invoices relate has been substantially completed and/or the materials to
which such invoices relate have been installed in,or delivered to, the Premises.Such progress payments will be made payable
to Tenant, or, at Tenant's prior written request,directly to the contractors and subcontractors to whom payment is owed,and
will be for the amount of the submitted invoices, less a ten percent(10%) retainage. As a condition precedent to Landlord's
issuing any such progress payment subsequent to the first such progress payment,Tenant will deliver to Landlord original lien
waivers from Contractor and any applicable subcontractor or supplier indicating the claims for mechanics' or materialmen's
liens with respect to the labor and materials reflected in the invoiced submitted for the immediately preceding progress payment
have been waived. A further condition precedent to Landlord's issuing the last such payment for the amount of the retainage
will be that Landlord has received from Tenant(either prior to or simultaneously with the issuance of such final payment)the
following: (a) written notice from Contractor and Tenant `s Architect (or other evidence satisfactory or Landlord)that the
Tenant improvements has been completed(including completion of any punch list items);(b)final and unconditional original
lien waivers from Contractor and all subcontractors,suppliers,materialmen and other parties who performed labor at,or sup-
plied materials to,the Premises in connection with the Tenant Improvements;and(c)a copy of the certificate of occupancy for
the Premises issued by the appropriate governmental authorities. Landlord will have no obligation to make any such progress
payment at any time that a Default exists under the Lease and the total of all such progress payments will in no event exceed
the amount of the Construction Allowance.
17. General. Failure by Tenant to pay any amounts due under this Work Letter will have the same effect as
failure to pay Rent under the Lease,and such failure or Tenant's failure to perform any of its other obligations under this Work
Letter will constitute a Default under Section 15.l(a)(1)of the Lease,entitling Landlord to all of its remedies under the Lease
as well as all remedies otherwise available to Landlord.
18. Exterior Monument Signage. Landlord and Tenant shall work in good faith to agree on exterior monument
signage for Tenant,comparable to the existing signage for tenant Burns&McDonnell. Tenant shall be able to use allowance
for cost of the monument sign.
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EXHIBIT C - NOTICE OF LEASE TERM
This NOTICE OF LEASE TERM("NLT"), is given by (TENANT),a (T state and entity type) as Tenant,to Hertz
Fort Worth Energy Way, LP a Delaware limited partnership, as Landlord, with respect to that certain Lease dated
,under which Tenant,has leased from Landlord certain Premises known as Suite#{ZZZ),of the Pier
1 Imports Building,located at 100 Energy Way,Fort Worth,TX 76102.
In consideration of the mutual covenants and agreements stated in the Lease,and intending that this Agreement may
be relied upon by Landlord and any prospective purchaser or present or prospective Encumbrance holder,Tenant certifies and
confirms the following;
(a) The Commencement Date is ,20
(b) The Expiration Date is 120
Except for those terms expressly defined in this NLT,all initially capitalized terms will have the meanings stated for
such terms in the Lease.
EXECUTED THIS DAY OF ,20 .
{TENANT},
a IT state and entity type}
By:
Print:
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EXHIBIT D - RULES & REGULATIONS
"Rules and Regulations" mean the contents of this Exhibit D, as modified, amended or revoked
by Landlord, from time to time.
1. Landlord's Entry.Landlord may enter the Premises at all reasonable hours to perform its obligations under
this Lease.During the last twelve(12)months of the Term, Landlord may enter the Premises with reasonable prior notice to
Tenant to show the Premises to prospective tenants.
2. Right to Exclude.Landlord may require that Tenant,its Affiliates and guests comply with each reasonable
security measure that Landlord may establish as a condition for entry to the Premises,Building or Project.These measures may
include submitting to a search by persons or devices employed by Landlord,presenting an identification card or pass issued by
the government, Landlord, or both, being announced to Tenant and accepted as a visitor by Tenant,and signing a register on
entry and exit.Any person who cannot comply with these requirements may be excluded from the Project.If Landlord requires
a Building pass issued by Landlord as a condition of entry to the Premises,Building or Project,Landlord will furnish a Building
pass to all persons reasonably designated by Tenant in writing. Landlord may exclude or expel from the Project any person
who,in Landlord's reasonable opinion, is intoxicated or under the influence of alcohol or drugs.
3. Obstructions.Tenant will not cause the Common Areas,or sidewalks or driveways outside the Building to
be obstructed.Landlord may remove,at Tenant's expense,any such obstruction without prior notice to Tenant.
4. Trash.Tenant will place trash in proper receptacles in the Premises provided by Tenant at Tenant's cost,or
in Building receptacles designated by Landlord.Tenant may not litter in the Common Areas,or sidewalks or driveways outside
the Building.
5. Public Safety. Tenant will not throw anything out of doors, windows or skylights, down passageways or
over walls.Tenant will not use any fire exits or stairways in the Building except in case of emergency.
6. Keys and Locks. Landlord may from time to time install and change locks on entrances to the Project,
Building, Common Areas or Premises, and will provide Tenant a number of keys to meet Tenant's reasonable requirements.
Additional keys will be furnished by Landlord at"Tenant's cost.At the end ofthe Term,Tenant will promptly return to Landlord
all keys for the Building and Premises issued by Landlord to Tenant.Unless Tenant obtains Landlord's prior written consent,
Tenant will not add or change any locks on any door to, in or about the Premises. If with Landlord's consent,Tenant installs
any lock incompatible with the Building master locking system,Tenant will: relieve Landlord of each Lease obligation that
requires access to each affected area;indemnify Landlord against any Claims resulting from forced entry to each affected area
in an emergency;and, at the end of the Term,remove each incompatible lock and replace it with a Building Standard lock at
Tenant's expense.
7. Aesthetics.Unless Tenant obtains Landlord's prior written consent(which may be withheld in Landlord's
sole discretion),Tenant may not:
(a) Attach any awnings, signs, displays, window shades, blinds, draperies, or projections to either the outside
walls or windows of the Building,or to any part of the Premises visible from outside the Premises or install
any internal lighting that may be visible from the exterior of the Premises;
(b) Hang any non-Building Standard curtains,blinds,shades or screens in any window or door of the Premises;
(c) Coat or sunscreen the interior or exterior of any windows;or
(d) Place any objects on windowsills.
8. Directories and Signs. Tenant shall be identified on the Building's directory in the main lobby and the
Premises will be identified by one (1) Building Standard sign consisting of Tenant's name and suite number located at the
entrance to the Premises.In the event that multiple tenants are located on one floor,each tenant's suite shall be identified on a
floor lobby directory sign as well.The initial lobby directory listing,floor lobby directory sign,if applicable,and Premises sign
will be at Landlord's cost and expense,and any changes to the listing or sign will be made at Tenant's cost and expense.
9. HVAC Operation.Tenant will not obstruct the HVAC convectors or diffusers, or adjust or interfere with
the HVAC system.Tenant will assist the HVAC system in maintaining comfort in the Premises by drawing shades,blinds and
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other window coverings in the Premises as may be reasonably required.Tenant may not use any method of heating or cooling
the Premises other than that supplied by Landlord.
10. Plumbing.Tenant will use plumbing fixtures only for the purpose for which they are constructed. Tenant
will reimburse Landlord for any damage caused by Tenant's misuse of plumbing fixtures.
11. Equipment Location.Landlord may specify the location of any of Tenant's business machines,mechanical
equipment or other property that are unusually heavy, may damage the Building,or may cause vibration,noise or annoyance
to other tenants.Tenant will reimburse Landlord for any professional engineering certification or assistance reasonably required
to determine the location of these items.
12. Bicycles.Tenant may not bring bicycles or other vehicles into the Building or Premises.Bicycles and other
vehicles may only be parked in areas designated by Landlord.
13. Animals. Tenant may not bring any birds, fish, reptiles, amphibians, insects or animals, excepting seeing-
eye/assistance dogs,into the Building or Premises.
14. Carpet Protection.To protect carpeting in the Premises,Tenant will,at its own expense,install and maintain
pads to protect the carpet under all furniture having castors other than carpet castors.
15. Elevators.Any use of the elevators for purposes other than normal passenger use(such as moving to or from
the Building or delivering freight),whether during or after Business Hours,must be scheduled through the office of the Property
Manager.Tenant will reimburse Landlord for any extra costs incurred by Landlord in connection with any such non-passenger
use of the elevators.
16. Moving and Deliveries.Tenant's movers are subject to Landlord's reasonable approval,Moving of Tenant's
Personal Property and deliveries of materials and supplies to the Premises must be made during the times and through the
entrances,elevators and corridors reasonably designated by Landlord.Moving and deliveries may not be made through any of
the main entrances to the Building without Landlord's prior permission. Any hand truck or other conveyance used in the
Common Areas must be equipped with rubber tires and rubber side guards to prevent damage to the Building and its properly.
Tenant will promptly reimburse Landlord for the cost of repairing any damage to the Building or its property caused by any
person making deliveries to the Premises.
17. Solicitation.Canvassing,soliciting and peddling in the Building are prohibited and Tenant will cooperate in
preventing the same.
IS. Food.Only persons approved from time to time by Landlord may prepare, solicit orders for, sell, serve or
distribute food in or around the Project. Except as may be specified in the Lease or on construction drawings for the Premises
approved by Landlord,and except for microwave cooking,Tenant will not use the Premises for preparing or dispensing food,
or soliciting of orders for sale,serving or distribution of food.
19. Work Orders.Only authorized representatives of Tenant may request services or work on behalf of Tenant.
Tenant may not request that Building employees perform any work outside of their duties assigned by Landlord.
20. Smoking. Neither Tenant nor its Affiliates shall smoke or permit smoking in any part of the Premises,
Building,Common Areas or Project in which Landlord,in Landlord's sole discretion,prohibits smoking or in which smoking
is prohibited by law. Landlord may designate the entire Building,Common Areas or Project a no-smoking area.
21. Holiday Decorations.Organic holiday decorations are not permitted in any part of the Premises.
22. Certificates of Insurance. Tenant is to provide Landlord with certificates of insurance as required by
Landlord, from each of contractor, vendor or agent performing work in, delivering products to,moving items into/out of the
Premises and/or Building.
23. Rules Applied. These Rules and Regulations apply equally to Tenant's Affiliates and others permitted by
Tenant to access, use or occupy the Premises.
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EXHIBIT E - PARKING
1. Term. During the Term, if Tenant is not in default of the Lease, Tenant shall have the license to
purchase no more than Tenant's Parking Allotment in order to park only insured,registered,passenger,motor vehicles
(including cars, light trucks and vans,but excluding recreational vehicles,motorcycles,bicycles, segways and other
vehicles as reasonably determined by Landlord)(each,a"Vehicle")in the Parking Facilities.
2. Use. Tenant's Parking Allotment may be used only by Tenant's employees (each, a "Patron").
Patrons will be granted access to the parking facilities only upon signing Landlord's standard parking license with
Landlord or Landlord's designated parking operator. Such parking license shall govern the relationship between any
Patron and Landlord or Landlord's designated parking operator.Storage of Vehicles overnight is prohibited.
3. Assignment.Except as permitted under Article 13 of the Lease,neither Tenant nor any Patron may
assign its license to park or its Parking Allotment.Landlord may freely assign Landlord's rights and obligations under
this exhibit to any successor owner or manager of the Parking Facilities.
4. Indemnification; Each party waives all claims against the other for damage to any property or
injury or death of any person in,upon or about the Parking Facility arising at any time and from any cause other than
the negligence or willful act of the other party, the employees or agents. This indemnity obligation shall include
reasonable attorneys'fees,investigation costs and all other reasonable and expenses incurred by a party from the first
notice that any claim or demand is to be made or may be made against that party. The provisions of this indemnity
shall survive the termination of the Lease with respect to any damage, injury or death occurring on or prior to such
termination.
5. Disclaimer.Each patron only has a license to park in the Parking Facilities at the Patron's sole risk.
No bailment is created.Landlord is not obligated to secure or insure Vehicles or their contents,and is not responsible
for any fire,theft,damage or loss to any Vehicle or its contents.Attendants are present solely to assist Patrons and arc
not required to verify ownership of Vehicles entering or exiting the Parking Facilities. Landlord does not represent,
guaranty or warrant that any communication or security systems,devices or procedures in the Parking Facilities will
be effective to prevent any loss, damage or injury to Tenant, Patrons or their guests. Landlord may discontinue or
modify any of these systems,devices or procedures at any time without any liability to Tenant,Patrons,or their guests.
5. Repairs, Improvements, Damage or Condemnation. If any Patron is unable to use the Parking
Facilities because of major repairs or improvements, damage or condemnation to the Parking Facilities or Project,
Landlord will not be in default of the Lease, but Tenant's or the Patron's obligation to pay monthly parking fees will
be abated for so long as the Parking Facilities cannot reasonably be used by the Patron.Abatement of Tenant's or the
Patron's monthly parking fees is Tenant's and the Patron's sole remedy if Landlord fails to provide Patron with use
of the Parking Facilities.
7. Rules and Regulations. This license is conditioned upon each Patron's compliance with the
following Parking Facilities rules and regulations("Parking Rules and Regulations"):
(a) Patron may be required to display a sticker,tag or other identification;
(b) Vehicle must be parked entirely within the stall lines painted on the floor.Parking is prohibited in:
areas not striped for parking;aisles;areas where"No Parking"signs are posted;cross hatched areas;
and in such other areas as may be designated by Landlord including areas designated as "Visitor
Parking"or reserved spaces not licensed under the Lease;
(0) All directional signs and arrows must be observed;
(d) The speed limit shall be five(5)miles per hour,unless posted otherwise;
(c) Every Patron is required to park and lock his own car unless it is turned over to a Parking Facilities
valet, if any. All responsibility for damage to cars or persons or loss of personal possessions is
assumed by the Patron;
(f) Spaces designated for compact Vehicles shall not be used by a full-sized Vehicle;
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(g) Parking Facilities' managers and attendants are not authorized to make or allow any exceptions to
Parking Rules and Regulations;and
(h) Parking Rules and Regulations may be modified by Landlord with notice to Tenant.
S. Default.Tenant's failure to comply with the terms of this license will be both a default of this license
and a default of the Lease. In response to a Tenant default under this license or under the Lease,Landlord,in addition
to the remedies provided under the Lease,may terminate Tenant's license to use the Parking Facilities.Landlord may
refuse to permit any Patron,who violates the Parking Rules and Regulations,to park in the Parking Facilities and may
remove the Patron's Vehicle at the Patron's and Tenant's expense,without any liability or interference with Tenant's
right to quiet possession of the Premises.
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EXHIBIT F - SNDA
(For Recorder's Use only)
SUBORDINATION.NONDISTURBANCE AND ATTORNMENT AGREEMENT
( [pool] ,Loan No. )
THIS SUBORDINATION, NONDISTURBANCE, AND ATTORNMENT AGREEMENT
(this "Agreement") is entered into as of , 20_ (the "Effective Date"), among
("Lender"), whose address is c/o Midland Loan Services, a
division of PNC Bank,National Association, 10851 Mastin Street,Suite 300,Overland Park,Kansas 66210
(Re: ; Loan No. ), a
("Tenant"), whose address is and
, a ("Landlord"), whose address is
with reference to the following facts:
A. Landlord owns the real property known as and having
a street address of ,such real property,including all buildings,improvements,struc-
tures and fixtures located thereon, (all or any portion thereof being referred to herein as the "Landlord's
Premises"), as more particularly described on Exhibit A.
B. ,a ("Original Lender")made a loan to Landlord in the
original principal amount of$ (the"Loan").
C. To secure the Loan,Landlord encumbered Landlord's Premises by entering into that certain
[Mortgage][Deed of Trust], [Assignment of Leases and Rents and Security Agreement] dated as of
, in favor of[a trustee for the benefit of] Original Lender (as amended, increased, re-
newed, extended,spread,consolidated,severed, restated,or otherwise changed from time to time,the"Se-
curity Instrument") recorded in the applicable land records of County,
D. Lender is now the holder of the Security Instrument and has authority to enter into this
Agreement.
E. Pursuant to a Lease dated as of together with any amendments,
modifications and renewals approved in writing by Lender to the extent such approval is required by the
Security Instrument(the"Lease"),Landlord demised to Tenant a portion of Landlord's Premises("Tenant's
Premises").
F. Lender has been requested by Landlord and Tenant to enter into this Agreement,and Ten-
ant and Lender desire to agree upon the relative priorities of their interests in Landlord's Premises and their
rights and obligations if certain events occur.
NOW,THEREFORE, for good and sufficient consideration, Tenant and Lender agree:
l. Definitions. The following terms shall have the following meanings for purposes of this Agreement:
1.1. "Construction-Related Obligation"means any obligation of Former Landlord(as hereinafter de-
fined) under the Lease to make, pay for, or reimburse Tenant for any alterations, demolition, or
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other improvements or work at Landlord's Premises,including Tenant's Premises. "Construction-
Related Obligation" shall not include: (a)reconstruction or repair following any fire, casualty or
condemnation which occurs after the date of attornment hereunder, but only to the extent of the
insurance or condemnation proceeds actually received by Successor Landlord for such reconstruc-
tion and repair, less Successor Landlord's actual expenses in administering such proceeds; or(b)
day-to-day maintenance and repairs.
1.2. "Foreclosure Event" means(a) foreclosure under the Security Instrument; (b)any other exercise
by Lender of rights and remedies(whether under the Security Instrument or under applicable law,
including bankruptcy law) as holder of the Loan and/or the Security Instrument, as a result of
which Successor Landlord becomes owner of Landlord's Premises; or (c) delivery by Former
Landlord to Lender(or its designee or nominee)of a deed or other conveyance of Former Land-
lord's interest in Landlord's Premises in lieu of any of the foregoing.
1.3. "Former Landlord" means Landlord and/or any other party that was landlord under the Lease at
any time before the occurrence of any attornment under this Agreement.
1A. "Offset Right" means any right or alleged right of Tenant to any offset, defense (other than one
arising from actual payment and performance,which payment and performance would bind a Suc-
cessor Landlord pursuant to this Agreement),claim,counterclaim,reduction,deduction,or abate-
ment against Tenant's payment of Rent or performance of Tenant's other obligations under the
Lease,arising(whether under the Lease or other applicable law)from acts or omissions of Former
Landlord and/or from Former Landlord's breach or default under the Lease.
1.5. "Rent" means any fixed rent,base rent or additional rent under the Lease.
1.6. "Successor Landlord" means any party that becomes owner of Landlord's Premises as the result
of a Foreclosure Event.
1.7. "Termination Right" means any right of Tenant to cancel or terminate the Lease or to claim a
partial or total eviction arising (whether under the Lease or under applicable law) from Former
Landlord's breach or default under the Lease.
2. Subordination. The Lease,and all right,title and interest of the Tenant thereunder and of the Tenant to
and in the Landlord's Premises, are, shall be, and shall at all times remain, subject and subordinate to
the Security Instrument,the lien imposed by the Security Instrument,and all advances made under the
Security Instrument.
3. Payment to Lender. In the event Tenant receives written notice (the "Rent Payment Notice") from
Lender or from a receiver for the Landlord's Premises that there has been a default under the Security
Instrument and that rentals due under the Lease are to be paid to Lender or to the receiver (whether
pursuant to the terms of the Security Instrument or of that certain Assignment of Rents and Leases
executed by Landlord as additional security for the Loan),Tenant shall pay to Lender or to the receiver,
or shall pay in accordance with the directions of Lender or of the receiver, all Rent and other monies
due or to become due to Landlord under the Lease, notwithstanding any contrary instruction,direction
or assertion of Former Landlord. Landlord hereby expressly and irrevocably directs and authorizes
Tenant to comply with any Rent Payment Notice, notwithstanding any contrary instruction, direction
or assertion of Landlord,and Landlord hereby releases and discharges Tenant of and from any liability
to Landlord on account of any such payments. The delivery by Lender or the receiver to Tenant of a
Rent Payment Notice, or Tenant's compliance therewith, shall not be deemed to: (i) cause Lender to
succeed to or to assume any obligations or responsibilities as landlord under the Lease, all of which
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shall continue to be performed and discharged solely by the applicable Landlord unless and until any
attomment has occurred pursuant to this Agreement; or(ii)relieve the applicable Former Landlord of
any obligations under the Lease. Tenant shall be entitled to rely on any Rent Payment Notice. Tenant
shall be under no duty to controvert or challenge any Rent Payment Notice. Tenant's compliance with
a Rent Payment Notice shall not be deemed to violate the Lease. Tenant shall be entitled to full credit
under the Lease for any Rent paid to Lender pursuant to a Rent Payment Notice to the same extent as
if such Rent were paid directly to Former Landlord.
4. Nondisturbance Recoguition and Attortlment.
4.1. No Exercise of Security Instrument Remedies against Tenant. So long as (i) the Lease has not
expired or otherwise been terminated by Former Landlord and (ii) there is no existing default
under or breach of the Lease by Tenant that has continued beyond applicable cure periods (an
"Event of Default"),Lender shall not name or join Tenant as a defendant in any exercise of Lend-
er's rights and remedies arising upon a default under the Security Instrument unless applicable law
requires Tenant to be made a party thereto as a condition to proceeding against Former Landlord
or prosecuting such rights and remedies. In the latter case,Lender may join Tenant as a defendant
in such action only for such purpose and not to terminate the Lease or otherwise diminish or in-
terfere with Tenant's rights under the Lease or this Agreement in such action.
4.2. Nondisturbance and Attornment. So long as (i) the Lease has not expired or otherwise been ter-
minated by Former Landlord, (ii) an Event of Default has not occurred, and (iii) no condition
exists which would cause or entitle Former Landlord to terminate the Lease on its terms, or to
dispossess the Tenant that would not be an Event of Default,then,if and when Successor Landlord
takes title to Landlord's Premises: (a) Successor Landlord shall not terminate or disturb Tenant's
possession of Tenant's Premises under the Lease,except in accordance with the terms of the Lease
and this Agreement; (b) Successor Landlord shall be bound to Tenant under all the terms and
conditions of the Lease (except as provided in this Agreement); (c) Tenant shall recognize and
attorn to Successor Landlord as Tenant's direct landlord under the Lease as affected by this Agree-
ment; (d)the Lease shall continue in full force and effect as a direct lease, in accordance with its
terms (except as provided in this Agreement), between Successor Landlord and Tenant; and (e)
Successor Landlord shall have all the rights and remedies of the landlord under the Lease,includ-
ing, without limitation, rights or remedies arising by reason of any Event of Default by Tenant
under the Lease, whether occurring before or after the Successor Landlord takes title to the Land-
lord's Premises.
4.3. Protection of Successor Landlord. Notwithstanding anything to the contrary in the Lease or the
Security Instrument,neither Lender nor Successor Landlord shall be liable for or bound by any of
the following matters:
a. Claims against Former Landlord. Any Offset Right or Termination Right that Tenant may have
against any Former Landlord relating to any event or occurrence before the date of attornment,
including any claim for damages of any kind whatsoever as the result of any breach by Former
Landlord that occurred before the date of attomment. The foregoing shall not limit Tenant's right
to exercise against Successor Landlord any Offset Right or Termination Right otherwise available
to Tenant because of events occurring after the date of attomment.
b. Construction-Related Obligations. Any Construction-Related Obligation!of Former Landlord.
C. Prepayments. Any payment of Rent that Tenant may have made to Former Landlord for more than
the current month.
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d. Payment: Securi1y Deposit. Any obligation: (a)to pay Tenant any sum(s)that any Former Land-
lord owed to Tenant or (b) with respect to any security deposited with Former Landlord, unless
such security was actually delivered to Lender or to Successor Landlord.
e. Modification Amendment or Waiver. Any modification or amendment of the Lease,or any waiver
of any terms of the Lease,made without Lender's written consent if such consent is required by the
Security Instrument.
f. Surrender Etc. Any consensual or negotiated surrender,cancellation,or termination of the Lease,
in whole or in part, agreed between Former Landlord and Tenant, unless effected unilaterally by
Tenant pursuant to the express terms of the Lease.
g. Partial Lease Assignment. Any assignment of one or more provisions of the Lease or the beneficial interest
therein not constituting the whole of the Lease.
h. Covenants. Any covenants or obligations of or applicable to Former Landlord to the extent they
apply to or affect any property other than Landlord's Premises.
5, Lender's Right to Cure.
5.1. Notice to Lender. Copies of all notices and other communications given by Tenant to Former
Landlord of a breach of or default under the Lease by Former Landlord shall also be simultane-
ously provided to Lender. Notwithstanding anything to the contrary in the Lease or this Agree-
ment or the Security Instrument,before exercising any Termination Right or Offset Right,Tenant
shall provide Lender with notice of the breach or default by Former Landlord giving rise to same
(the "Default Notice") and,thereafter,the opportunity to cure such breach or default as provided
for below.
5.2. Lender's Cure Period. After Lender receives a Default Notice,Lender shall have a period of thirty
(30) days beyond the time available to Former Landlord under the Lease in which to cure the
breach or default by Former Landlord, or, in the event that such cure cannot be completed within
such cure period, Lender shall have such reasonable period of time as is required to diligently
prosecute such cure to its completion. Lender shall have no obligation to cure(and shall have no
liability or obligation for not curing)any breach or default by Former Landlord.
6. Exculpation of Successor Landlord. Notwithstanding anything to the contrary in this Agreement or the
Lease, upon any attornment pursuant to this Agreement,the Lease shall be deemed to have been auto-
matically amended to provide that Successor Landlord's obligations and liabilities under the Lease shall
never extend beyond Successor Landlord's(or its successors'or assigns')interest,if any, in Landlord's
Premises from time to time, including insurance and condemnation proceeds(except to the extent re-
invested in the Landlord's Premises),Successor Landlord's interest in the Lease,and the proceeds from
any sale or other disposition of Landlord's Premises by Successor Landlord (collectively, "Successor
Landlord's Interest"). Tenant shall look exclusively to Successor Landlord's Interest (or that of its
successors and assigns) for payment or discharge of any obligations of Successor Landlord tinder the
Lease as affected by this Agreement. If Tenant obtains any money judgment against Successor Land-
lord with respect to the Lease or the relationship between Successor Landlord and Tenant,then Tenant
shall look solely to Successor Landlord's Interest(or that of its successors and assigns)to collect such
judgment. Tenant shall not collector attempt to collect any such judgment out of any other assets of
Successor Landlord.
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7. Miscellaneous.
7.1. Notices. All notices or other communications required or permitted under this Agreement shall be
in writing and given by personal delivery or by nationally recognized overnight courier service
that regularly maintains records of items delivered. Each party's address is as set forth in the
opening paragraph of this Agreement, subject to change by notice under this paragraph. Notices
shall be effective upon delivery if sent by personal delivery and the next business day after being
sent by overnight courier service.
7.2. Successors and Assigns. This Agreement shall bind and benefit the parties,their successors and
assigns,any Successor Landlord,and its successors and assigns. Upon assignment of the Security
Instrument by Lender, all liability of the Lender/assignor shall terminate.
7.3. Entire Agreement. This Agreement constitutes the entire agreement between Lender and Tenant
and Landlord regarding the subordination of the Lease to the Security Instrument and the rights
and obligations of Tenant,Lender and Landlord as to the subject matter of this Agreement.
7.4. Interaction with Lease and with Security_instrument. If this Agreement conflicts with the Lease,
then this Agreement shall govern as between the parties and any Successor Landlord, including
upon any attornment pursuant to this Agreement. This Agreement supersedes,and constitutes full
compliance with,any provisions in the Lease that provide for subordination of the Lease to,or for
delivery of non-disturbance agreements by the holder of, the Security Instrument. Lender con-
firms that Lender has consented to Landlord's entering into the Lease.
7.5. Lender's Rights and Obligations.
a. Except as expressly provided for in this Agreement, Lender shall have no obligations to Tenant
with respect to the Lease. If an attornment occurs pursuant to this Agreement, then all rights and
obligations of Lender under this Agreement shall terminate, without thereby affecting in any way
the rights and obligations of Successor Landlord provided for in this Agreement.
b. Neither this Agreement, the Security Instrument or any of the related loan documents, nor the
Lease shall, prior to any acquisition of Landlord's Premises by Lender, operate to give rise to or
create any responsibility or liability for the control,care, management or repair of the Landlord's
Premises upon the Lender, or impose responsibility for the carrying out by Lender of any of the
covenants, terms or conditions of the Lease, nor shall said instruments operate to make Lender
responsible or liable for any waste committed on the Landlord's Premises by any party whatsoever,
or for dangerous or defective conditions of the Landlord's Premises, or for any negligence in the
management,upkeep,repair or control of the Landlord's Premises,which may result in loss,injury
or death to Tenant,or to any tenant,licensee, invitee,guest,employee, agent or stranger.
C. Lender may assign to any person or entity its interest under the Security Instrument and/or the
related loan documents, without notice to, the consent of, or assumption of any liability to, any
other party hereto. In the event Lender becomes the Successor Landlord, Lender may assign to
any other patty its interest as the Successor Landlord without the consent of any other party hereto.
7.6. Landlord's Rights and Obligations. Nothing herein contained is intended,nor shall it be construed,
to abridge or adversely affect any right or remedy of Landlord under the Lease, including upon
the occurrence of an Event of Default by Tenant under the Lease.This Agreement shall not alter,
waive or diminish any of Landlord's obligations under the Security Instrument,any of the related
loan documents,or the Lease.
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7.7. Option or Right to Purchase Landlord's Premises or the Loan. Notwithstanding any other provision
contained herein, this Agreement does not constitute an agreement by nor a consent of Lender to
any provision whatsoever in the Lease allowing or providing for any right or option to Tenant,any
affiliate of Tenant or any successor or assignee of Tenant to purchase, in whole or in part,either
Landlord's Premises or the Loan or any of the instruments or documents evidencing the Loan or
securing payment of the Loan and neither Lender nor any assignee of or successor to Lender shall
be bound in any way by any such right or option.
7.8. Interpretation; Governing Law. The interpretation, validity and enforcement of this Agreement
shall be governed by and construed under the internal laws of the state where the Landlord's Prem-
ises are located, excluding its principles of conflict of laws.
7.9. Amendments. This Agreement may be amended,discharged or terminated,or any of its provisions
waived,only by a written instrument executed by the parties hereto.
7.10. Due Authorization. Each party represents that it has full authority to enter into this Agreement,
which has been duly authorized by all necessary actions.
7.11. Execution. This Agreement may be executed in any number of counterparts, each of which shall
be deemed an original and all of which together shall constitute one and the same instrument.
7.12. Attorneys' Fees. All costs and attorneys'fees incurred in the enforcement hereof shall be paid by
the non-prevailing party.
7.13. Hear dinl;s. The headings in this Agreement are intended to be for convenience of reference only,
and shall not define the scope, extent or intent or otherwise affect the meaning of any portion
hereof.
7.14. WAIVER OF JURY TRIAL. THE TENANT AND THE LANDLORD EACH HEREBY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AFTER CAREFUL CONSIDER-
ATION AND AN OPPORTUNITY TO SEEK LEGAL ADVICE,WAIVE THEIR RESPECTIVE
RIGHTS TO HAVE A TRIAL BY JURY IN RESPECT OF ANY LITIGATION ARISING OUT
OF OR IN ANY WAY CONNECTED WITH ANY OF THE PROVISIONS OF THIS AGREE-
MENT,OR ANY OTHER DOCUMENTS EXECUTED IN CONJUNCTION HEREWITH,ANY
TRANSACTION CONTEMPLATED BY THIS AGREEMENT, THE LANDLORD'S PREM-
ISES, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE LANDLORD, TENANT OR
LENDER. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE LENDER TO EN-
TER INTO THIS AGREEMENT.
(REMAINDER OF PAGE LEFT INTENTIONALLY BLANK)
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IN WITNESS WHEREOF,this Agreement has been duly executed by Lender,Tenant and Landlord
as of the Effective Date.
LENDER:
By: Midland Loan Services,a division of PNC Bank,
National Association as its Master Servicer and
attorney in fact
By:
Name:
Title:
STATE OF KANSAS )
} ss.
COUNTY OF JOHNSON )
On this_day of ,29_,before me,a Notary Public in and for the State of Kansas, person-
ally appeared , personally known to me(or proved to me on the basis of satisfactory evi-
dence)to be the person who executed this instrument,on oath stated that he was authorized to execute the
instrument,and acknowledged that he is the Senior Vice President and Servicing Officer of Midland Loan
Services, a division of PNC Bank, National Association to be the free and voluntary act and deed of said
company for the uses and purposes mentioned in the instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and official seal the day and year first
above written.
(seal)
(Print Name)
NOTARY PUBLIC in and for the State of
Kansas.
My appointment expires
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TENANT:
a
By:
Name:
Title:
STATE OF }
}
COUNTY OF )
The foregoing instrument was acknowledged before me this day of , 20_, by
as of , on behalf of the
He/She is personally!mown to me or has produced a driver's license as identification.
NOTARY PUBLIC, STATE OF
Print or Stamp Name of Notary
My Commission Expires: [Notarial Seal]
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LANDLORD:
a
By:
Name:
Title:
STATE OF )
COUNTY OF }
The foregoing instrument was acknowledged before me this day of , 20`, by
as of , on behalf of the
He/She is personally known to me or has produced a driver's license as identification.
NOTARY PUBLIC, STATE OF
Print or Stamp Name of Notary
My Commission Expires: [Notarial Seal]
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EXHIBIT A
LEGAL DESCRIPTION
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EXHIBIT G -ANTENNA RIGHTS
1. Scope of Rights. Subject to the terms and conditions of this Lease and provided no Default has
occurred under this Lease, Landlord hereby grants Tenant the non exclusive right to install, maintain and operate
during the Term radio antennae or satellite dishes and related equipment(collectively, the "Antenna Equipment")
on portions of the roof of the Building in the exact locations reasonably specified by Landlord,after giving good faith
consideration to any Iocation requested by Tenant(such locations being referred to as a"Site"),provided,the Antenna
Equipment(i)does not adversely affect in any material manner the structure of the Building,the roof of the Building,
the warranty for the roof of the Building or the safety of the Building; (ii)does not adversely affect in any material
manner the electrical, mechanical or any other system of the Building or the functioning thereof; (iii) does not ad-
versely interfere with the operation of the Building or the provision of services or utilities to other current or future
tenants in the Building;and(iv)is otherwise approved by Landlord in writing(which approval shall not be unreason-
ably,withheld,conditioned or delayed).
2. Compliance With Law.Tenant shall install,maintain and operate the Antenna Equipment in com-
pliance with all present and future rules and regulations of any local, State or Federal authority having jurisdiction
with respect thereto,including,without limitation,the rules and regulations of the Federal Communications Commis-
sion("FCC"),the Federal Aviation Administration("FAA")the Antenna Equipment being permitted under the laws,
rules and regulations of any other govcrnmental and quasi governmental authorities having appropriate jurisdiction
over the Building or Tenant's use of the Antenna Equipment.Tenant shall deliver to Landlord written proof of com-
pliance within twenty(20)days of Landlord's written request.Tenant shall,with Landlord's good faith,diligent coop-
eration,obtain all permits,licenses,variances,authorizations and approvals that may be required in order to install the
Antenna Equipment.
3. Installation Procedures.
(a) Prior to installation of the Antenna Equipment and any modifications or changes thereto,
Tenant shall submit in writing all plans for Landlord's approval to Landlord, and shall commence work only after
having obtained Landlord's written approval,which shall not be unreasonably withheld,conditioned,or delayed.The
style, color, materials, exact location and method of installation of the Antenna Equipment are subject to the prior
written approval of Landlord,which shall not be unreasonably withheld,conditioned,or delayed.
(b) All of such installations,modifications or changes shall conform to Landlord's reasonable
technical requirements,including but not limited to,design and installation specifications,Interference control devices
and weight and windload requirements.
(c) The Antenna Equipment shall be clearly marked to show Tenant's name,address,telephone
number,the name of the person to contact in case of emergency,FCC call sign,frequency and location;the transmis-
sions lines shall be identified at the bottom and top of each line.
(d) In the event Tenant requires an electric power supply and/or usage different from that cur-
rently provided by Landlord,Tenant shall,at its sole cost and expense,obtain such power supply.Any work performed
in connection therewith shall comply with the provisions of Section 8 of the Lease. Any power lines installed by
Tenant shall run within Landlord's current easements.Any deviation from such easement rights shall be corrected at
Tenant's expense,payable as an additional fee hereunder within ten(10)days of Tenant's receipt of an invoice therefor.
(e) In the event a zoning variance is required in connection with the installation or modification
of the Antenna Equipment,Tenant may,with Landlord's good faith,diligent cooperation,seek to obtain such variance
at Tenant's sole cost and expense,provided however,that such variance and/or the conditions under which such vari-
ance would be granted shall in no way impair or affect the zoning otherwise affecting the Building or any part thereof,
including without limitation the Land.
(f) In all matters where Landlord's approval is required and where Landlord's engineer makes
a reasonable determination that interference or other disruption with the business of Landlord or other existing licen-
sees is likely to result from Tenant's contemplated action,Landlord shall have the right to withhold such approval by
written notice to'Tenant,setting forth in reasonable detail the basis for Landlord's disapproval.
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(g) All work performed at the Building in connection with the installation and modification of
the Antenna Equipment shall be performed at Tenant's expense by Tenant's employees or by contractors reasonably
approved by Landlord.
(h) Landlord shall provide to Tenant sufficient access to the Site and affected areas of the base
Building for the maintenance and operation of the Antenna Equipment.Access to the Site or other areas of the Building
will be available by telephoning the property manager for the Building,the number for which property manager shall
be provided to Tenant upon request from time to time. Tenant shall reimburse Landlord for all costs and expenses
incurred by Landlord as a result of access outside of the normal business hours of the Building. All access to the Site
or other areas of the Building shall be subject to the continuing control of,and reasonable security and safety proce-
dures established by,Landlord.
W Tenant shall pay Landlord(within thirty(30) days after receipt of an invoice therefor)an
amount equal to all costs incurred by Landlord to have an engineer review the plans and specifications for the Antenna
Equipment and specifications and method for attaching the Antenna Equipment to the Building.
6) Tenant shall install any screen or other covering for the Antenna Equipment that Landlord
in its reasonable discretion may require(the size,type and style of which shall be subject to Landlord's prior written
approval) in order to camouflage or conceal the Antenna Equipment.
(k) The Antenna Equipment shall not be more than thirty six inches (36") in height and not
more than the weight that Landlord shall determine is appropriate for the roof(which Landlord shall specify to Tenant
upon Tenant's written request).
4. Interference.
(a) The installation, maintenance and operation of the Antenna Equipment shall not interfere
electronically or otherwise,with(i)the equipment, facilities,site use and marketability or operations of Landlord,or
(ii)the equipment,facilities or operations of Landlord's present licensees or tenants at the Building. If any such inter-
ference is caused by the installation,maintenance and operation of the Antenna Equipment,Tenant shall,upon written
or oral request,suspend its operations until such time as the interference has been eliminated,except for intermittent
testing after performing such repair,modification,replacement or other action for the purpose of correcting the inter-
ference. If Tenant is unable to rectify the interference,then upon Landlord's request, Tenant shall (at Tenant's cost)
remove the Antenna Equipment from the Building(and restore the Site and the Building area affected to the condition
existing prior to installation of the Antenna Equipment)and comply with the provisions of Section 5 below governing
removal of the Antenna Equipment. All transmitters and/or repeater systems at the Site shall be equipped with, at a
minimum,a single stage isolator and a bandpass filter or bandpass/reject type duplexer.No notch type duplexers will
be allowed.Complete technical characteristics for required equipment(including response curves)shall be furnished
to Landlord and approved for use prior to Tenant's installation of the Antenna Equipment. Landlord shall use com-
mercially reasonable efforts to ensure that any equipment installed or placed on the roof after the Installation of the
Antenna Equipment will be located in an area that is not likely to materially interfere electronically or otherwise with
the Antenna Equipment installed by or on behalf of Tenant.
(b) Tenant waives any and all claims against Landlord for any interference caused to or with
Tenant's Antenna Equipment by the present or future equipment or facilities of Landlord or any of its tenants or
licensees.
5. Maintenance and Removal of the Antenna Equipment.
(a) Tenant shall,at its sole cost and expense,be responsible for the maintenance of the Antenna
Equipment in accordance with all applicable laws and regulations and this Lease. All maintenance work shall be
performed by Tenant's employees or by certified contractors,previously approved in writing by Landlord, such ap-
proval not to be unreasonably withheld,conditioned or delayed.
(b) At the expiration or earlier termination of this Lease, Tenant shall remove the Antenna
Equipment from the Building(and restore the Site and the Building areas affected to the condition existing prior to
installation of the Antenna Equipment)at Tenant's sole cost and expense.The removal shall be performed by a certi-
fied contractor previously approved in writing by Landlord (such approval not to be unreasonably withheld, condi-
tioned or delayed), in a workmanlike manner in accordance with a previously approved removal plan(such approval
not to be unreasonably withheld,conditioned or delayed)and without causing any interference or damage to the struc-
tures,equipment,or operations of Landlord or any of its licensees or tenants at the Building.Should any interference,
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damage or destruction occur,it shall be immediately remedied by Tenant at Tenant's sole cost and expense.If Tenant
fails to eliminate any such interference or to make any such repair within seven(7)business days of receiving written
notice of the occurrence of interference or damage, Landlord may perform the necessary work at Tenant's cost and
expense and such amount shall be paid by Tenant,as additional Rent hereunder, within thirty(30) days of Tenant's
receipt of an invoice therefor.
6. Indemnification.
(a) Except to the extent resulting directly from the gross negligence or willful misconduct of
Landlord, Tenant shall indemnify and save Landlord harmless from and against any and all loss, costs, liabilities,
damages,judgments, and expenses, including reasonable attorney's fees, in connection with claims resulting from
bodily injury or death of any person, or from damage to any property sustained by any person, including Tenant,
arising from the installation,removal and maintenance of the Antenna Equipment.
(b) Tenant covenants and agrees that the installation, operation and removal of the Antenna
will be at its sole risk.Landlord shall not be liable to Tenant for any loss,damage or expense arising from any damage
to the Antenna Equipment that may be occasioned by,through,or in connection with any acts or omissions of Landlord
or Landlord's agents or employees. Tenant agrees to indemnify and hold Landlord and all other persons or entities
having facilities located at the Site harmless,from all costs of any damage done to Landlord's or other persons facilities
or equipment located at the Building,that occur as a result of the installation, operation or maintenance of Tenant's
Antenna Equipment.Tenant hereby assumes the risk of the inability to operate Tenant's Antenna Equipment as a result
of any structural or power failure at the Building or failure of Tenant's Antenna Equipment for any reason whatsoever
and agrees to indemnify and hold Landlord harmless from all damages and costs of defending any claim or suit for
damages of any kind including business interruption (and reasonable attorneys' fees) asserted against Landlord by
reason of such failure.
7. Taxes.Tenant hereby acknowledges that the existence of the Antenna Equipment and Tenant's other
improvements may result in an increase in the assessed valuation of the Building. Upon receipt of documentation
specifically showing that the Antenna Equipment or Tenant's other improvements directly and solely caused such
increase Tenant shall reimburse Landlord for any increase in the real estate taxes payable by Landlord as a conse-
quence of the increase in assessed valuations,subject to Tenant's right to obtain an exemption therefor on Landlord's
behalf. Landlord shall, at Tenant's sole cost and expense, cooperate with Tenant to obtain an abatement of any such
increase assessment. In the event any sales, use or other tax shall be payable by Landlord in connection with this
Lease,Tenant shall reimburse Landlord on demand for such payments or shall furnish necessary documentation to the
appropriate government authorities to show that fee payments hereunder are exempt from such sales,use or other tax.
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Exhibit B
Excluded Items
• Primary server(That runs our network)*
• All Printers—5 Multi-plea on the floor and two large publication printers in pubs(These are rentals)
• The three-hole drilling machine in pubs
• Two drum roll printers in pubs
• Binding machine in pubs
• Coffee machines in break areas (These are also lease)
• Personnel items/equipment
*All cables and racking will remain in place
Termination of Office Lease—100 Energy Way
PAE Applied Technologies LLC
City of Fort Worth, Texas
Mayor and Council Communication
DATE: 12/14/21 M&C FILE NUMBER: M&C 21-1002
LOG NAME: 21 PAE TERMINATION
SUBJECT
(CD 9) Authorize Early Termination of Office Lease with PAE Applied Technologies, LLC for
Suite 1500 in the Future City Hall Located at 100 Energy Way, Fort Worth, Texas 76102 in
Exchange for a Payment from PAE Applied Technologies, LLC in the Amount of$735,982.50
and the Existing Furnishings and Information Technology Equipment
RECOMMENDATION:
It is recommended that the City Council:
1. Authorize the early termination of office lease with PAE Applied Technologies, LLC for Suite
1500 in the future city hall building located at 100 Energy Way, Fort Worth, Texas 76102; and
2. Accept a one-time payment of$735,982.50 from PAE Applied Technologies, LLC and all
remaining furnishings and information technology equipment as consideration for the early
termination.
DISCUSSION:
The purpose of this Mayor and City Council Communication (M&C) is to authorize termination of
the office lease (Lease) with PAE Applied Technologies, LLC (PAE) for Suite 1500, consisting of
the entirety of the 15th floor or approximately 26,763 rentable square feet of space, in the former
Pier 1 building and future City Hall located at 100 Energy Way, Fort Worth, Texas 76102. On
December 15th, 2020, the City Council authorized the acquisition of the building from Hertz Fort
Worth Energy Way L.P. and accepted assignment of the building's existing leases, including the
Lease with PAE (M&C 20-0910).
The Lease provides for a term of approximately one hundred thirty-two (132) full calendar months
with a commencement date of October 1, 2019 and an expiration date of September 30, 2030.
The total amount of rent due and payable to the City of Fort Worth (City) under the existing term of
the Lease is $3,040,946.01. However, Property Management staff has determined that an early
termination of the Lease in exchange for a one-time payment of$735,982.50 and the remaining
furnishings and information technology equipment would be in the best interests of the City. The
termination agreement would specify that the Lease will terminate no later than March 31, 2022
and that PAE will continue to pay all rent, taxes, and expenses due under the Lease until PAE
surrenders the space to the City. An early termination of the Lease will allow the City to more
quickly program and utilize space on the 15th floor and will allow the City the flexibility to lease
additional space on the 16th floor.
The City intends to use the revenue from this termination payment, in the amount of$735,982.50, to
offset future borrowing requirements related to improvements associated with the new City Hall.
Staff will return to Council with an M&C to appropriate the revenue at the time debt is issued for this
purpose.
The property is located in COUNCIL DISTRICT 9.
A Form 1295 is not required because: This M&C does not request approval of a contract with a
business entity.
FISCAL INFORMATION / CERTIFICATION:
The Director of Finance certifies that upon approval of the above recommendations and adoption
of the attached appropriation ordinance, funds will be deposited into the General Capital Projects
Fund. The Property Management Department (and Financial Management Services) is
responsible for the collection and deposit of funds due to the City. Prior to any expense being
incurred, the Property Management Department also has the responsibility to validate the
availability of funds.
Submitted for City Manager's Office by: Dana Burghdoff 8018
Originating Business Unit Head: Steve Cooke 5134
Additional Information Contact: Greg Wingate 0496
Expedited