HomeMy WebLinkAboutContract 54622-A2CSC No. 54622-A2
SECOND AMENDMENT TO THE LEASE AGREEMENT (CSC# 54622)
This Second Amendment to the Lease Agreement ("Second Amendment") is made and
entered into by and between the City of Fort Worth, a home -rule municipal corporation of the
State of Texas ("C"), acting herein by and through Dana Burghdoff, its duly authorized
Assistant City Manager, and Alliance Al No. 1, LLC, a Texas limited liability company
("Tenant"), acting herein by and through its duly authorized representative. City and Tenant are
individually referred to as a "party" and collectively referred to as the "parties".
WHEREAS, the City entered into the Lease Agreement (CSC #54622) (the "Original
Agreement") with Tenant on September 29, 2020 to lease a certain piece of land consisting of
approximately 108,900 square feet of ground space to construct a building of approximately 9,600
square feet ("Property"), to be subleased by Tenant to TuSimple, Inc. ("TuSimtDle") for their
autonomous commercial trucking operations. Capitalized terms used but not defined herein shall
have the meanings given to them in the Original Agreement; and
WHEREAS, on January 15, 2022, the parties entered into the First Amendment to the
Lease Agreement (CSC# 46522-A1) (the "First Amendment") to add a certain piece of land,
contiguous to the Property, consisting of approximately 126,324 square feet of ground space
("Expansion Property") to the Property. Property and Expansion Property are collectively
referred to as "Leased Premises". The Original Agreement, as amended by the First Amendment,
is referred to herein as the "Agreement"; and
WHEREAS, on May 16, 2023, Tenant notified City of TuSimple's termination of the
Sublease of the Leased Premises; and
WHEREAS, Tenant desires to amend the lease to: a) sublease any or all portions of the
Leased Premises to Gatik Al, LLC; b) provide for the option to sublease to other entities with City
approval; c) revise the Early Termination Date; d) extend the Lease Term; and e) revise rental rates
for the Lease Term.
NOW THEREFORE, in consideration of the terms set forth in the Agreement, the parties
agree to amend the Agreement effective as of the Effective Date of this Second Amendment.
AGREEMENTS:
1) Parak;raph 1. Premises of the Original Agreement is deleted in its entiretv and replaced
with the followinc:
1. Premises. City hereby grants Tenant the exclusive use of the Leased Premises
(as defined in the Second Amendment) and any improvements now or hereafter located thereon.
Tenant may sublease any or all portions of the Leased Premises to Gatik Al, LLC pursuant to the
terms of the Sublease Agreement attached hereto as Exhibit D (as amended and/or assigned from
time to time, the "Sublease"), which the City hereby approves. Under no circumstances during the
Lease Term will Tenant and/or Subtenant use or cause to be used on the Leased Premises any
hazardous or toxic substances or materials, or store or dispose of any such substances or materials
OFFICIAL RECORD
4855-5406-2950v.5 1 CITY SECRETARY
FT. WORTH, TX
on the Leased Premises other than what has been approved by City; provided that the presence,
transportation, removal or handling of fuel, engine oil and hydraulic fluids used for or stored in
vehicles parked or operating on the Leased Premises will not be deemed a violation of this
Agreement. Tenant shall not install signs, advertising media, and lettering on the Leased Premises
without prior written approval of City. Tenant will have access to the Leased Premises 24 hours a
day, 7 days a week. City agrees to provide Tenant with reasonable prior notice in the event City
desires to access the Leased Premises; provided that City may not interfere with Tenant's use, or
any subtenant's use, of the Leased Premises in accordance with this Agreement.
2) Exhibit D: Sublease Agreement of the Original A.?reement is deleted in its entirety and
replaced with Exhibit D-I. attached to this Second Amendment.
3) Paragraph 3. Lease Term of the Orizinal Agreement is deleted in its entiretv and replaced
with the following:
3. Lease Term. Subject to Paragraph 4 of this Agreement and the extension or earlier
termination as hereinafter set forth, this Agreement shall be for a term ("Lease Term") of (a) eighty-
eight (88) months, commencing on April 1, 2021 and expiring on August 31, 2028, and (b) shall continue
on a month -to -month basis thereafter, terminable by City or Tenant upon 30 days' prior written notice.
For avoidance of doubt, the parties hereby agree and acknowledge that Paragraph 5 (Extension
Option) of the Original Agreement remains unchanged and in full force and effect; accordingly,
Tenant may, at its option, extend the Lease Term for one (1) period of five (5) years by delivering
written notice thereof to City.
4) Paragraph 8. Expansion Option of the Original Agreement is deleted in its entirety.
5) Paragraph 18. Assignment and Subletting of the Orit-=inal Agreement is deleted in its
entiretv and replaced with the following:
18. Assignment and Subletting. Tenant a) shall not assign this Agreement, or any
right of Tenant under this Agreement, other than to an Affiliate (defined below) of Tenant and b)
shall have the option to sublet any or all portions of the Leased Premises to entities other than
Gatik AI, LLC for consideration or no consideration, whether voluntarily, by operation of law, or
otherwise, with first obtaining City's written consent, not to be unreasonably withheld, conditioned
or delayed; provided that Tenant's contractors and agents may use the Leased Premises in
accordance with the terms and provisions hereof. Assignment (other than to an Affiliate of Tenant)
will be subject to City Council approval. As used herein, "Affiliate" means any person or entity
which, directly or indirectly, through one or more intermediaries, controls, is controlled by, or is
under common control with the party in question.
6) Para--raph 6. Termination Option of the Original A�-,i-eement is deleted in its entirety and
replaced with the following:
6. Termination Option. Tenant may, at its option, terminate this Agreement
effective as of August 31, 2027 (the "Earle Termination Date") by delivering written notice
thereof to City. If Tenant so terminates this Agreement, Tenant shall deliver to City the amount of
$87,500.00 (the "Termination Fee") within thirty (30) days following the Early Termination Date.
7) The rent schedule in Paravraph 7 of the Original Agreement is deleted in its entirety and
replaced with the following:
Time Period
Annual Rent PSF
Monthly Rent
1/15/2022 — 3/31/2022
$0.65
$12,835.68
4/1/2022 — 3/31/2023
$0.69
$13,590.72
4/1/2023—3/31/2024
$0.75
$14,632.53
4/1/2024-3/31/2025
$0.80 I
$15,583.59
4/1/2025-3/31/2026 I
$0.90 I
$17,641.80
4/l/2026 — 3/31/2027 I
$0.95 I
$18,621.90
4/l /2027 — 3/31 /2028 I
$1.00
$19,602.00
4/1/2028 — 8/31/2028
$1.05
$20,582.10
8) Binding Effect, Governing Law. Except as modified hereby, all other terms and
conditions of the Agreement remain unchanged and in full force and effect. If any inconsistency
exists or arises between the terms of the Agreement and the terms of this Second Amendment, the
terms of this Second Amendment shall prevail. This Second Amendment shall be binding on City,
Tenant and their respective successors and assigns. This Second Amendment shall be governed
by the laws of the State of Texas.
(SIGNATURES APPEAR ON FOLLOWING PAGE)
3
15th
EXECUTED this day of
CITY: CITY OF FORT WORTH
a
Dana Burghdoff (Sep 2023 CDT)
Dana Burghdoff
Assistant City Manager
September , 2023 (the "Effective Date").
TENANT: ALLIANCE Al NO. 1 LLC
By: �
Name: Berry
Title:
Date: 7 — / Z - z - 3
CONTRACT COMPLIANCE MANAGER
By signing, I acknowledge that I am the person responsible
for the monitoring and administration of this contract, including
ensuring all performance
Gc
rrfrr o,Jm�-Wance and reporting requirements.
//j
By: Mask eroE*,° isep is, 202312:16 cor7
Mark Brown
Name:
Title: Lease Manager, Property Management Department
APPROVED AS TO FORM AND LEGALITY:
By:
Jeremy Anato-Mensah
Assistant City Attorney I
ATTEST:
a FORt�B
M 0 ono �o
BY: °cuo a=a
d
Jannette S. Goodall °°o nE4p54a"
City Secretary
Form 1295: 2023-1049659
Contract Authorization:
M&C: 23-0763
OFFICIAL RECORD
[Signature Page] CITY SECRETARY
FT. WORTH, TX
AP
EXHIBIT D-1
SUBLEASE AGREEMENT,
A- �
DocuSign Envelope ID: 99E4F040-F373-44CE-92C6-OCE893E38EB5
SUBLEASE AGREEMENT
This Sublease Agreement ("Agreement") is entered into this July 12, 2023 ("Effective Date") by
and between ALLIANCE AI NO. 1, LLC, a Texas limited liability company ("Sublandlord"), and
GATIK Al INC., a Delaware corporation ("Subtenant").
WHEREAS, pursuant to the Lease Agreement dated September 29, 2020 (as amended to date, the
"Prime Lease"), the City of Fort Worth, Texas ("Cit ") is leasing to Sublandlord certain real property
consisting of approximately 235,224 square feet (5.4 acres) of ground space (the "Prouerty") together with
all improvements thereon from time to time (collectively, the "Leased Premises"). The Property is more
particularly described in Exhibit A attached hereto;
WHEREAS, Sublandlord desires to sublet the portion of the Leased Premises consisting of
approximately 108,900 square feet (2.5 acres) of ground space together with that certain warehouse,
containing approximately 9,600 square feet (the "Building"), and all improvements thereon from time to
time (collectively, the "Subleased Premises") to Subtenant, and Subtenant desires to assume all of
Sublandlord's obligations under the Prime Lease, subject to the terms and conditions contained herein. The
Subleased Premises are cross -hatched in Exhibit B attached hereto; and
WHEREAS, Subtenant has requested to lease from Sublandlord, and Sublandlord agrees to lease
to Subtenant, the Subleased Premises in accordance with the terms and conditions of this Agreement.
WITNESSETH:
1. Premises. Sublandlord hereby leases to Subtenant, and Subtenant leases from Sublandlord,
the Subleased Premises pursuant to the terms of this Agreement. As more particularly described in
Paragraph 43, under no circumstances during the Lease Term will Subtenant use or cause to be used on the
Leased Premises any hazardous or toxic substances or materials, or store or dispose of any such substances
or materials on the Leased Premises other than as approved by City and Sublandlord in writing or as
otherwise authorized by Paragraph 43; provided that the presence, transportation, removal or handling of
fuel, engine oil and hydraulic fluids used for or stored in vehicles parked or operating on the Leased
Premises in compliance with all applicable laws and the terms and conditions of Paragraph 43 will not be
deemed a violation of this Agreement. Subtenant shall not install signs, advertising media, and lettering on
the Subleased Premises without prior written approval of City (to the extent required under the Prime Lease)
and Sublandlord, not to be unreasonably withheld, conditioned or delayed. Subtenant will have access to
the Subleased Premises 24 hours a day, 7 days a week. Sublandlord may enter the Subleased Premises (i) at
all reasonable times upon reasonable prior notice (which may be verbal notice) to Subtenant, to inspect the
Subleased Premises and show the Subleased Premises to prospective lenders or purchasers, (ii) at any time
in the case of real or apparent emergency (in which case no notice shall be required) to attend to such
emergency, and (iii) at all reasonable times upon reasonable prior notice (which may be verbal notice) to
Subtenant during the last one hundred eighty (180) days of the Lease Term (defined below) or at any time
following an Event of Default (defined below), to show the Subleased Premises to prospective tenants or
subtenants (provided, if no Event of Default exists and Subtenant is then occupying the Subleased Premises,
Subtenant shall have the opportunity to provide a representative of Subtenant, if so requested by Subtenant,
to accompany any such entry, although Sublandlord shall not be required to wait for a Subtenant
representative prior to any entry); provided, however, that Sublandlord shall use commercially reasonable
efforts to minimize any interference with Subtenant's business and use of the Subleased Premises when
exercising its rights under this Paragraph 1 with respect to any of the foregoing entries described.
2. Condition of Subleased Premises. Subtenant taking possession of the Subleased Premises
shall be conclusive evidence that (a) the Subleased Premises are suitable for the purposes and uses for which
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same are leased; and (b) Subtenant waives any and all defects in and to the Subleased Premises, its
appurtenances, and in all the appurtenances thereto. Further, Subtenant takes the Subleased Premises and
all appurtenances in "AS IS" condition without warranty, expressed or implied, on the part of Sublandlord.
Sublandlord shall not be liable to any Subtenant Party for any damage to any person or property due to the
Subleased Premises (except to the extent determined by a court of competent jurisdiction, in a final non -
appealable judgment that such damage was caused by Sublandlord's or its agent's or contractor's gross
negligence or willful misconduct) or any part of any appurtenance thereof being improperly constructed or
being or becoming in disrepair. As used herein, "Subtenant Part►" means any of the following persons:
Subtenant; any assignees claiming by, through or under Subtenant; any subtenants claiming by, through or
under Subtenant; and any of their respective agents, contractors, officers, employees, licensees, guests and
invitees.
3. Lease Term. This Agreement shall be for a term ("Lease Term") of sixty (60) full
calendar months, plus any partial month from the Commencement Date (defined below) to the end of the
month in which the Commencement Date falls, starting on the Commencement Date and ending at 5:00
p.m. local time on the last day of the 60' full calendar month following the Commencement Date, subject
to adjustment and earlier termination as provided in the Agreement. Prior to occupying the Subleased
Premises or, if later, within ten (10) days after a written request from Sublandlord, Subtenant shall execute
and deliver to Sublandlord a letter confirming the Commencement Date and the expiration date of the Lease
Term; however, the failure of the parties to execute such letter shall not defer the Commencement Date or
otherwise invalidate this Agreement.
4. Commencement Date. The Lease Term shall commence on the earlier of (a) the date on
which Subtenant occupies any portion of the Subleased Premises and begins conducting business therein,
or (b) September 1, 2023 (the "Commencement Date").
5. Rent. Subtenant will pay Sublandlord rent ("Rent") to use the Subleased Premises during
the Lease Term, in the following amounts for the following periods of time:
Lease Month
Monthly Rent
1-9
$27,000.00
10 — 21
$28,080.00
22 — 33
$29,203.20
34 — 45
$30,371.33
46 — 57
$31,586.18
58 — 60
$32,849.63
Rent is due to Sublandlord on or before the I" of each month without notice, demand, deduction or
set off by good and sufficient check drawn on a national banking association, or at either party's election,
by electronic or wire transfer, at Sublandlord's address provided for in this Agreement or such other address
as may be specified in writing by Sublandlord, and shall be accompanied by all applicable state and local
sales or use taxes. The obligations of Subtenant to pay Rent to Sublandlord and the obligations of
Sublandlord under this Agreement are independent obligations. If a payment of Rent is not received by
Sublandlord as provided herein, then after five (5) business days after receipt of written notice from
Sublandlord, such Rent shall bear interest from the date the payment of Rent was due until paid, at a per
annum rate of interest (the "Default Rate") equal to the lesser of (a) ten percent (10%) or (b) the highest
non -usurious rate permitted by applicable law. Time is specifically of the essence of this provision and of
every provision of this Agreement.
4854-6732-4772v.8
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As used herein, the term "Lease Month" means each calendar month during the Lease Tenn (and if the
Commencement Date does not occur on the first day of a calendar month, the period from the
Commencement Date to the first day of the next calendar month shall be included in the first Lease Month
for purposes of determining the duration of the Lease Term and the monthly Rent rate applicable for such
partial month).
6. Securit► Deposit. Contemporaneously with the execution of this Agreement, Subtenant
shall pay to Sublandlord a security deposit in the amount of $32,849.63 (the "Securi(N- Deposit"), which
shall be held by Sublandlord to secure Subtenant's performance of its obligations under this Agreement.
The Security Deposit is not an advance payment of Rent or a measure or limit of Sublandlord's damages
upon an Event of Default (as defined herein). Sublandlord may, from time to time following an Event of
Default and without prejudice to any other remedy, use all or a part of the Security Deposit to perform any
obligation Subtenant fails to perform hereunder. Following any such application of the Security Deposit,
Subtenant shall pay to Sublandlord on demand the amount so applied in order to restore the Security Deposit
to its original amount. Provided that Subtenant has performed all of its obligations hereunder, Sublandlord
shall, within 60 days after the expiration of the Lease Term and Subtenant's surrender of the Subleased
Premises in compliance with the provisions of this Agreement, return to Subtenant the portion of the
Security Deposit which was not applied to satisfy Subtenant's obligations. The Security Deposit may be
commingled with other funds, and no interest shall be paid thereon. If Sublandlord transfers its interest in
the Subleased Premises and the transferee assumes Sublandlord's obligations under this Agreement, then
Sublandlord may assign the Security Deposit to the transferee and Sublandlord thereafter shall have no
further liability for the return of the Security Deposit. The rights and obligations of Sublandlord and
Subtenant under this Section 6 are subject to any other requirements and conditions imposed by laws
applicable to the Security Deposit.
7. Utilities and Services. Sublandlord shall not furnish Subtenant with any utilities, cleaning,
lighting, security, or any other items or services for the Subleased Premises. All operating costs (including,
without limitation, water, gas, heat, light, power, telephone, and other utilities and services supplied to the
Leased Premises) shall be Subtenant's sole cost and expense. If Subtenant wants or needs any utilities,
cleaning, lighting, security, or any other items or services while occupying the Subleased Premises, then
Subtenant shall be responsible for obtaining any of the above items at Subtenant's sole cost. Except as
otherwise expressly provided herein and except for any amounts payable by Sublandlord under the Prime
Lease as a result of the actions or inactions of any Subtenant Party, this Agreement is intended to be a gross
sublease and as such, no operating costs, insurance or tax expenses, or other amounts due and payable by
Sublandlord under the Prime Lease shall be passed through to Subtenant hereunder.
8. Licenses and Permits. Subtenant shall, at its sole cost and expense, obtain and keep in
force during the Lease Term, and all extensions thereof, all licenses, certificates and permits necessary for
it to use the Subleased Premises in accordance with applicable laws.
9. Alterations. Additions, Improvements, and Signaae. Except as otherwise provided
herein, Subtenant shall make no alterations on or additions to, the Subleased Premises without the prior
written consent of Sublandlord, not to be unreasonably withheld, and the City (to the extent required under
the Prime Lease); provided that Subtenant may, at its sole option and expense, remove any alterations
installed by or on behalf of Subtenant at any time during the Lease Term. Notwithstanding the foregoing,
so long as no consent of the City is required under the Prime Lease, Subtenant shall not be required to
obtain Sublandlord's consent for repainting, recarpeting, or other improvements which are cosmetic in
nature, in each case provided that (i) Subtenant's contractors and subcontractors performing such work
maintain insurance in respect thereof in amounts as are standard for comparable buildings in the submarket
in which the Building is located, (ii) the installation thereof does not require the issuance of any building
permit or other governmental approval, or involve any core drilling or installation of equipment and systems
4854-6732-4772v.8
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used for or associated with the use, storage or dispensing of Hazardous Materials or the configuration or
location of any exterior or interior walls of the Building, and (iii) such improvements will not affect (a) the
Building's structure or the Building's systems or (b) the exterior of the Building. All alterations, additions
and improvements made to or fixtures or other improvements placed in or upon the Subleased Premises not
removed therefrom prior to the end of the Lease Term shall be deemed a part of the Subleased Premises
and the property of Sublandlord at the end of the Lease Term. All such alterations, additions,
improvements, and fixtures shall remain upon and be surrendered with the Subleased Premises as a part
thereof at the termination of this Agreement unless otherwise requested by Sublandlord in writing.
10. Vehicle Maintenance. Subtenant shall have the right to perform, on the Subleased
Premises, maintenance and repairs of vehicles in accordance with the terms and conditions of this
Agreement. All such services shall be performed in accordance with applicable environmental laws and
Subtenant agrees to be responsible for any damages and clean-up associated with any spill, release, or other
discharge of hazardous materials on the Subleased Premises to the extent caused by a Subtenant Party.
11. Indemnity.
(a) SUBJECT TO SECTION 14, SUBTENANT SHALL AND DOES AGREE TO
INDEMNIFY, PROTECT, DEFEND AND HOLD HARMLESS SUBLANDLORD, SUBLANDLORD'S
OFFICERS, AGENTS, SERVANTS, AND EMPLOYEES (COLLECTIVELY, "INDEMNITEES") FOR,
FROM AND AGAINST ANY AND ALL CLAIMS, LIABILITIES, DAMAGES, LOSSES, LIENS,
CAUSES OF ACTION, SUITS, JUDGMENTS AND EXPENSES (INCLUDING REASONABLE
COURT COSTS, REASONABLE ATTORNEYS' FEES AND REASONABLE COSTS OF
INVESTIGATION), OF ANY NATURE, KIND OR DESCRIPTION TO THE EXTENT ARISING OR
ALLEGED TO ARISE BY REASON OF INJURY TO OR DEATH OF ANY PERSON OR DAMAGE
TO OR LOSS OF PROPERTY TO THE EXTENT CAUSED BY (i) THE NEGLIGENCE, GROSS
NEGLIGENCE, OR WILLFUL MISCONDUCT OF ANY SUBTENANT PARTY OR (ii) ANY
BREACH, VIOLATION OR NONPERFORMANCE OF ANY COVENANT OF SUBTENANT UNDER
THIS AGREEMENT (COLLECTIVELY, "LIABILITIES"), IN ALL CASES EXCEPT TO THE
EXTENT ARISING OUT OF OR RESULTING FROM THE SOLE OR GROSS NEGLIGENCE OR
WILLFUL MISCONDUCT OF ANY INDEMNITEE. IF ANY ACTION OR PROCEEDING SHALL BE
BROUGHT BY OR AGAINST ANY INDEMNITEE IN CONNECTION WITH ANY SUCH LIABILITY
OR CLAIM, SUBTENANT, ON NOTICE FROM SUBLANDLORD, SHALL DEFEND SUCH ACTION
OR PROCEEDING, AT SUBTENANT'S EXPENSE, BY OR THROUGH ATTORNEYS
REASONABLY SATISFACTORY TO SUBLANDLORD. THIS INDEMNIFICATION SHALL NOT BE
LIMITED TO DAMAGES, COMPENSATION OR BENEFITS PAYABLE UNDER INSURANCE
POLICIES, WORKERS' COMPENSATION ACTS, DISABILITY BENEFIT ACTS OR OTHER
EMPLOYEES' BENEFIT ACTS. This indemnity provision shall survive termination or expiration of this
Agreement.
(b) IT IS AGREED WITH RESPECT TO ANY LEGAL LIMITATIONS NOW OR
HEREAFTER IN EFFECT AND AFFECTING THE VALIDITY OR ENFORCEABILITY OF THE
INDEMNIFICATION OBLIGATIONS UNDER THIS PARAGRAPH 11, SUCH LEGAL
LIMITATIONS ARE MADE A PART OF THE INDEMNIFICATION OBLIGATIONS AND SHALL
OPERATE TO AMEND THE INDEMNIFICATION OBLIGATION TO THE MINIMUM EXTENT
NECESSARY TO BRING THE PROVISION INTO CONFORMITY WITH THE REQUIREMENTS OF
SUCH LIMITATIONS, AND AS SO MODIFIED, THE INDEMNIFICATION OBLIGATION SHALL
CONTINUE IN FULL FORCE AND EFFECT.
12. Waiver of Liability. ALL VEHICLES AND ALL PERSONAL PROPERTY WITHIN
VEHICLES USING THE LEASED PREMISES, WHETHER PURSUANT TO THIS AGREEMENT OR
4
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OTHERWISE SHALL BE AT THE RISK OF SUBTENANT ONLY, AND NO 1NDEMNITEES SHALL
BE LIABLE FOR ANY LOSS OR THEFT OF OR DAMAGE TO PROPERTY OF ANY SUBTENANT
PARTY OR TO OTHERS, REGARDLESS OF WHETHER SUCH PROPERTY IS ENTRUSTED TO
SUBLANDLORD OR ANY AGENT OR REPRESENTATIVE OF SUBLANDLORD OR SUCH LOSS
OR DAMAGE IS OCCASIONED BY CASUALTY, THEFT OR ANY OTHER CAUSE OF
WHATSOEVER NATURE, UNLESS DUE TO THE SOLE OR GROSS NEGLIGENCE OF ANY
INDEMNITEE.
13. Insurance. Subtenant shall comply with the insurance requirements set forth in Exhibit C
attached hereto.
14. No Subrogation; Waiver of Property Claims. Sublandlord and Subtenant each waives
any claim it might have against the other for any damage to or theft, destruction, loss, or loss of use of any
property, to the extent the same is insured against (or self -insured against) under any insurance policy held
or maintained by Sublandlord or Subtenant that covers the Leased Premises, or any fixtures, personal
property or improvements thereon, regardless of whether the negligence of the other party caused such
Loss (defined below). Additionally, Sublandlord and Subtenant each waives any claim it may have against
the other for any Loss to the extent such Loss is caused by a terrorist act. Each party shall cause its insurance
carrier to endorse all applicable policies waiving the carrier's rights of recovery under subrogation or
otherwise against the other party. Notwithstanding any provision in this Agreement to the contrary,
Sublandlord, its agents, employees and contractors shall not be liable to Subtenant or to any party claiming
by, through or under Subtenant for (and Subtenant hereby releases Sublandlord and its servants, agents,
contractors, employees and invitees from any claim or responsibility for) any damage to or destruction,
loss, or loss of use, or theft of any property of any Subtenant Party located in or about the Leased Premises,
caused by casualty, theft, fire, third parties or any other matter or cause, regardless of whether the
negligence of any party caused such loss in whole or in part. Subtenant acknowledges that Sublandlord
shall not carry insurance on, and shall not be responsible for damage to, any property of any Subtenant
Party located in or about the Leased Premises. Notwithstanding anything to the contrary in this Agreement,
Sublandlord shall not be liable to Subtenant, and Subtenant hereby waives and releases all claims against
Sublandlord and its representatives and agents, for any damages arising from any act, omission or neglect
of any other party in the Leased Premises and in no event shall Sublandlord or its representatives and agents
be liable for any injury or interruption to Subtenant's business or any loss of income therefrom under any
circumstances. As used herein, "Loss" means any injury to or death of any person or the damage to or
theft, destruction, loss, or loss of use of, any property or inconvenience.
15. Abandoned Proverty. Subtenant's personal property not promptly removed by Subtenant
from the Subleased Premises at the termination of this Agreement, whether termination shall occur by the
lapse of time or otherwise, shall thereupon be conclusively presumed to have been abandoned by Subtenant
to Sublandlord; provided, however, that Sublandlord shall give Subtenant written notice of any property
left behind, and Subtenant shall have a period of no less than ten (10) days after receipt of such notice to
remove its property before it shall be deemed abandoned.
16. Atggnment and Subletting. Subtenant shall not assign, sublet nor otherwise transfer any
of Subtenant's rights under this Agreement nor permit any person (other than Subtenant and its agents and
employees) or entity to use the Subleased Premises or any portion thereof without the prior written approval
of the City (to the extent required under the Prime Lease) and Sublandlord, not to be unreasonably withheld,
conditioned or delayed. Any such attempt to assign or transfer without City's and Sublandlord's prior
written approval shall be void and of no effect.
17. Repairs and Maintenance. Sublandlord has no obligation to make repairs of any sort to
the Subleased Premises, and Sublandlord's sole obligation hereunder with respect to the delivery and
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condition of the Subleased Premises being to make the Subleased Premises available to Subtenant in
accordance with and subject to the covenants, restrictions and limitations set forth herein. Subtenant shall,
at its expense, use and maintain the Subleased Premises in a neat, clean, careful, safe, and proper manner
including but not limited to any snow and/or ice removal, and comply with all applicable laws, ordinances,
orders, rules, and regulations of all governmental bodies (state, county, federal, and municipal). Subtenant
shall repair any damage caused to the Leased Premises by any Subtenant Party, other than ordinary wear
and tear and damage or loss caused by casualty or condemnation. At the termination of this Agreement,
whether by lapse of time or otherwise, Subtenant shall deliver the Subleased Premises to Sublandlord in
substantially the same condition as of the date of the taking of possession thereof by Subtenant, ordinary
wear and tear and damage or loss caused by casualty or condemnation excepted.
18. Condemnation.
(a) Total Takint. If the entire Subleased Premises are taken by right of eminent
domain or conveyed in lieu thereof (a "Taking'), this Agreement shall terminate as of the date of the
Taking.
(b) Partial Taking - Subtenant's Rim. If any part of the Subleased Premises
becomes subject to a Taking and such Taking will prevent Subtenant from conducting on a permanent basis
its business in the Subleased Premises in a manner reasonably comparable to that conducted immediately
before such Taking, then Subtenant may terminate this Agreement as of the date of such Taking by giving
written notice to Sublandlord within thirty (30) days after the Taking, and Rent shall be apportioned as of
the date of such Taking. If Subtenant does not terminate this Agreement, then Rent shall be abated on a
reasonable basis as to that portion of the Subleased Premises subject to the Taking.
(c) Partial Taking - Sublandlord's Rights. If any material portion, but less than all,
of the Subleased Premises becomes subject to a Taking, then Sublandlord may tenninate this Agreement
by delivering written notice thereof to Subtenant within thirty (30) days after such Taking, and Rent shall
be apportioned as of the date of such Taking. If Sublandlord does not so terminate this Agreement, then
this Agreement will continue, but if any portion of the Subleased Premises has been taken, Rent shall abate
as provided in the last sentence of Section 18(b).
19. Casualty.
(a) Repair Estimate. If the Building is damaged by fire or other casualty (a
"Casualt►°"), Subtenant shall immediately give written notice to Sublandlord of the same, and Sublandlord
shall, within ninety (90) days after such Casualty (or, if later, after Sublandlord's receipt of Subtenant's
notice of such Casualty), deliver to Subtenant a good faith estimate (the "Damage Notice") of the time
needed to repair damage to the Building caused by such Casualty.
(b) Subtenant's Rights. If the Building is damaged by Casualty such that Subtenant
is prevented from conducting its business therein in a manner reasonably comparable to that conducted
immediately before such Casualty and Sublandlord estimates that the damage caused thereby for which
Sublandlord is responsible to repair under this Agreement pursuant to Section 19(d) below cannot be
repaired within one year after the commencement of repairs (the "Repair Period"), then Subtenant may
terminate this Agreement by delivering written notice to Sublandlord of its election to terminate within
thirty (30) days after the Damage Notice has been delivered to Subtenant.
(c) Sublandlord's Rights. If a Casualty occurs and (1) Sublandlord estimates that the
damage cannot be repaired within the Repair Period, (2) the damage exceeds 50% of the replacement cost
thereof (excluding foundations and footings), as estimated by Sublandlord, and such damage occurs during
4854-6732-4772v.8
DocuSign Envelope ID: 99E4F040-F373-44CE-92C6-OCE893E38EB5
the last two years of the Lease Term, (3) regardless of the extent of damage, the damage is not fully covered
by Sublandlord's insurance policies or Sublandlord makes a good faith determination that restoring the
damage would be uneconomical, or (4) Sublandlord is required to pay any insurance proceeds arising out
of the Casualty to City, then Sublandlord may terminate this Agreement by giving written notice of its
election to terminate within thirty (30) days after the Damage Notice has been delivered to Subtenant.
(d) Reuair Obli aQ tion. If neither party elects to terminate this Agreement following
a Casualty, then Sublandlord shall, within a reasonable time after such Casualty, begin to repair the Building
and shall proceed with reasonable diligence to restore the Building to substantially the same condition as it
existed immediately before such Casualty; however, Sublandlord shall not be required to repair or replace
any improvements, alterations or betterments in the Building (which shall be promptly and with due
diligence repaired and restored by Subtenant at Subtenant's sole cost and expense) or any furniture,
equipment, trade fixtures or personal property of Subtenant or others in the Building, and Sublandlord's
obligation to repair or restore the Building shall be limited to the extent of the insurance proceeds actually
received by Sublandlord therefor. If this Agreement is terminated under the provisions of this Paragraph
19, Sublandlord shall be entitled to the full proceeds of the insurance policies providing coverage for all
alterations, improvements and betterments in the Subleased Premises (and, if Subtenant has failed to
maintain insurance on such items as required by this Agreement, Subtenant shall pay Sublandlord an
amount equal to the proceeds Sublandlord would have received had Subtenant maintained insurance on
such items as required by this Agreement).
(e) Waiver of Statutory Provisions. The provisions of this Paragraph 19 shall
constitute Subtenant's sole and exclusive remedy in the event of damage or destruction to the Subleased
Premises, and Subtenant waives and releases all statutory rights and remedies in favor of Subtenant in the
event of damage or destruction.
20. Severability. If any clause or provision of this Agreement is or becomes illegal, invalid or
unenforceable because of present or future laws or any rule or regulation of any governmental body or
entity, effective during the Lease Term, the intention of the parties hereto is that this Agreement will be
modified to the minimum extent possible to make legal, valid or enforceable the affected provision of this
Agreement, and the remaining parts of this Agreement shall not be affected thereby.
21. Events of Default. Each of the following occurrences shall be an "Event of Default":
(a) Pavment Default. Subtenant's failure to pay any amount due hereunder within
five (5) days after Sublandlord has delivered written notice to Subtenant that the same is due;
(b) Prohibited Payments. Subtenant becomes an entity from which Sublandlord is
legally prohibited from accepting Rent payments or otherwise transacting business;
(c) Abandonment. Subtenant (a) abandons the Subleased Premises or any substantial
portion thereof unless (1) Subtenant has notified Sublandlord in writing at least ten business days in advance
that it intends to abandon the Premises; (2) no Event of Default then exists and no event, circumstance or
condition has occurred or exists which, with the passage of time or giving of notice, would constitute an
Event of Default; and (3) Subtenant fulfills all of its obligations under Section 17 hereof, or (b) vacates the
Subleased Premises or a substantial portion thereof for more than thirty (30) days without providing written
notice to Sublandlord at least ten (10) business days prior to the date on which Subtenant vacates the
Subleased Premises or any substantial portion thereof;
(d) Estoppel: Subordination: Attornment. Subtenant fails to provide any estoppel
certificate or documentation regarding the subordination of this Agreement or Subtenant's attornment
7
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DocuSign Envelope ID: 99E4F040-F373-44CE-92C6-OCE893E38EB5
obligations hereunder after Sublandlord's written request therefor pursuant to Section 25 or Section 37(b),
and such failure shall continue for five (5) days after Sublandlord's second written notice thereof to
Subtenant;
(e) Insurance. Subtenant fails to procure and maintain the insurance policies and
coverages required under Exhibit C or Subtenant fails to deliver to Sublandlord (within five (5) business
days after Sublandlord's demand therefor) evidence of such insurance policies and coverages as required
under Exhibit C:
(f) Mechanic's Liens. Subtenant fails to pay and release of record, or diligently
contest and bond around, any mechanic's lien filed against the Leased Premises for any work performed,
materials furnished, or obligation incurred by or at the request of Subtenant, within twenty (20) days of
written notice from Sublandlord;
(g) Unnermitted Transfer. Subtenant shall transfer this Agreement or Subtenant's
interest herein except as expressly permitted in this Agreement;
(h) Other Defaults. Subtenant's failure to perform, comply with, or observe any other
agreement or obligation of Subtenant under this Agreement and the continuance of such failure for a period
of more than thirty (30) days after Sublandlord has delivered to Subtenant written notice thereof; however,
if such failure cannot be cured within such 30-day period (thus excluding, for example, Subtenant's
obligation to provide Sublandlord evidence of Subtenant's insurance coverage) and Subtenant commences
to cure such failure within such 30-day period and thereafter diligently pursues such cure to completion,
then such failure shall not be an Event of Default unless it is not fully cured by the earliest of (a) thirty (30)
additional days after the expiration of the initial 30-day period, (b) the date that is five business days prior
to Sublandlord being in default of any agreement between Sublandlord and any third party as a result of
Subtenant's failure under this Agreement, or (c) the expiration of the Lease Term; or
(i) Insolvency. The filing of a petition by or against Subtenant (the term "Subtenant"
shall include, for the purpose of this Paragraph 21, any guarantor of Subtenant's obligations hereunder)
(1) in any bankruptcy or other insolvency proceeding; (2) seeking any relief under any state or federal
debtor relief law; (3) for the appointment of a liquidator or receiver for all or substantially all of Subtenant's
property or for Subtenant's interest in this Agreement; or (4) for the reorganization or modification of
Subtenant's capital structure; however, if such a petition is filed against Subtenant, then such filing shall
not be an Event of Default unless Subtenant fails to have the proceedings initiated by such petition
dismissed within ninety (90) days after the filing thereof.
22. Remedies. Upon any Event of Default, Sublandlord may, in addition to all other rights
and remedies afforded Sublandlord hereunder or by law or equity, take any one or more of the following
actions:
(a) Termination of Lease. Terminate this Agreement by giving Subtenant written
notice thereof, in which event Subtenant shall pay to Sublandlord the sum of (1) all Rent accrued hereunder
through the date of termination, (2) all amounts due under Section 23(a), and (3) an amount equal to (but
in no event less than zero) (a) the total Rent that Subtenant would have been required to pay for the
remainder of the Lease Term discounted to present value at a per annum rate equal to the Prime Rate
(defined below) on the date this Agreement is terminated minus one percent, minus (b) the then present fair
rental value of the Subleased Premises for such period, similarly discounted. As used herein, "Prime Rate"
means the "Prime Rate" as published on the date in question by The Wall Street Journal in its listing of
"Money Rates;
4854-67324772v.8
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(b) Termination of Possession. Terminate Subtenant's right to possess the Subleased
Premises without terminating this Agreement by giving written notice thereof to Subtenant, in which event
Subtenant shall pay to Sublandlord (1) all Rent and other amounts accrued hereunder to the date of
termination of possession, (2) all amounts due from time to time under Section 23(a), and (3) all Rent and
other net sums required hereunder to be paid by Subtenant during the remainder of the Lease Term,
diminished by any net sums thereafter received by Sublandlord through reletting the Subleased Premises
during such period, after deducting all costs incurred by Sublandlord in reletting the Subleased Premises.
Sublandlord shall not be liable for, nor shall Subtenant's obligations hereunder be diminished because of,
Sublandlord's failure to relet the Subleased Premises or to collect rent due for such reletting. Subtenant
shall not be entitled to the excess of any consideration obtained by reletting over the Rent due hereunder.
Reentry by Sublandlord in the Subleased Premises shall not affect Subtenant's obligations hereunder for
the unexpired Term; rather, Sublandlord may, from time to time, bring an action against Subtenant to collect
amounts due by Subtenant, without the necessity of Sublandlord's waiting until the expiration of the Lease
Term. Unless Sublandlord delivers written notice to Subtenant expressly stating that it has elected to
terminate this Agreement, all actions taken by Sublandlord to dispossess or exclude Subtenant from the
Subleased Premises shall be deemed to be taken under this Paragraph 22(b). If Sublandlord elects to
proceed under this Paragraph 22(b), it may at any time elect to terminate this Agreement under Paragraph
22(a); or
(c) Perform Acts on Behalf of Subtenant. Perform any act Subtenant is obligated
to perform under the terms of this Agreement (and enter upon the Subleased Premises in connection
therewith if necessary) in Subtenant's name and on Subtenant's behalf, without being liable for any claim
for damages therefor, and Subtenant shall reimburse Sublandlord on demand for any expenses which
Sublandlord may incur in thus effecting compliance with Subtenant's obligations under this Agreement
(including collection costs and legal expenses), plus interest thereon at the Default Rate.
23. Pavment bv Subtenant: Non -Waiver: Cumulative Remedies.
(a) Pavment by Subtenant. Upon any Event of Default, Subtenant shall pay to
Sublandlord all amounts, costs, losses and/or expenses incurred, abated or foregone by Sublandlord
(including court costs and reasonable attorneys' fees and expenses) in (1) obtaining possession of the
Subleased Premises, (2) removing, storing and/or disposing of Subtenant's or any other occupant's
property, (3) repairing, restoring, altering, remodeling, or otherwise putting the Subleased Premises into the
condition acceptable to a new tenant, (4) if Subtenant is dispossessed of the Subleased Premises and this
Agreement is not terminated, reletting all or any part of the Subleased Premises (including brokerage
commissions, cost of tenant finish work, and other costs incidental to such reletting), (5) performing
Subtenant's obligations under this Agreement which Subtenant failed to perform, (6) enforcing, or advising
Sublandlord of, its rights, remedies, and recourses arising out of the default, and (7) securing this
Agreement, including all commissions, allowances, reasonable attorneys' fees, and if this Agreement or
any amendment hereto contains any abated Rent granted by Sublandlord as an inducement or concession
to secure this Agreement or amendment hereto, the full amount of all Rent so abated (and such abated
amounts shall be payable immediately by Subtenant to Sublandlord, without any obligation by Sublandlord
to provide written notice thereof to Subtenant, and Subtenant's right to any abated rent accruing following
such Event of Default shall immediately terminate).
(b) No Waiver. Sublandlord's acceptance of Rent following an Event of Default shall
not waive Sublandlord's rights regarding such Event of Default. No waiver by Sublandlord of any violation
or breach of any of the terms contained herein shall waive Sublandlord's rights regarding any future
violation of such term. Sublandlord's acceptance of any partial payment of Rent shall not waive
Sublandlord's rights with regard to the remaining portion of the Rent that is due, regardless of any
endorsement or other statement on any instrument delivered in payment of Rent or any writing delivered in
9
4854-6732-4772v.8
DocuSign Envelope ID: 99E4F040-F373-44CE-92C6-OCE893E38EB5
connection therewith; accordingly, Sublandlord's acceptance of a partial payment of Rent shall not
constitute an accord and satisfaction of the full amount of the Rent that is due.
(c) Cumulative Remedies. Any and all remedies set forth in this Agreement: (1)
shall be in addition to any and all other remedies Sublandlord may have at law or in equity, (2) shall be
cumulative, and (3) may be pursued successively or concurrently as Sublandlord may elect. The exercise
of any remedy by Sublandlord shall not be deemed an election of remedies or preclude Sublandlord from
exercising any other remedies in the future. Additionally, Subtenant shall defend, indemnify and hold
harmless Sublandlord, Sublandlord's mortgagee and their respective representatives and agents from and
against all claims, demands, liabilities, causes of action, suits, judgments, damages and expenses (including
reasonable attorneys' fees) arising from Subtenant's failure to perform its obligations under this Agreement.
(d) '.Mitigation of Damage. The parties agree any duty imposed by law on
Sublandlord to mitigate damages after a default by Subtenant under this Agreement shall be satisfied in full
if Sublandlord uses reasonable efforts to lease the Subleased Premises to another tenant (a "Substitute
Tenant") in accordance with the following criteria: (A) Sublandlord shall have no obligation to solicit or
entertain negotiations with any Substitute Tenant for the Subleased Premises until sixty (60) days following
the date upon which Sublandlord obtains full and complete possession of the Subleased Premises, including
the relinquishment by Subtenant of any claim to possession of the Subleased Premises by written notice
from Subtenant to Sublandlord; (B) Sublandlord shall not be obligated to lease or show the Subleased
Premises on a priority basis or offer the Subleased Premises to any prospective tenant when similar space
is or soon will be available for lease or sublease by Sublandlord or its affiliates; (C) Sublandlord shall not
be obligated to lease the Subleased Premises to a Substitute Tenant for less than the current fair market
value of the Subleased Premises, as determined by Sublandlord in its sole discretion, nor will Sublandlord
be obligated to enter into a new lease for the Subleased Premises under other terms and conditions that are
unacceptable to Sublandlord under Sublandlord's then -current leasing policies; (D) Sublandlord shall not
be obligated to enter into a lease with a Substitute Tenant: (1) whose use would violate any restriction,
covenant or requirement applicable to the Subleased Premises; (2) whose use would adversely affect the
reputation of the Property or Sublandlord; (3) whose use would require any addition to or modification of
the Subleased Premises, Building or Property in order to comply with applicable law, including building
codes; (4) who does not have, in Sublandlord's sole opinion, the creditworthiness to be an acceptable tenant;
(5) that is a governmental entity, or quasi -governmental entity, or subdivision or agency thereof, or any
other entity entitled to the defense of sovereign immunity; (6) that does not meet Sublandlord's reasonable
standards for tenants of the Property or is otherwise incompatible with the character of the Property, as
reasonably determined by Sublandlord; (7) whose use does not comply with the uses permitted under this
Agreement; or (8) whose use or occupancy would result in an increase in the insurance premiums for the
Property; and (E) Sublandlord shall not be required to expend any amount of money to alter, remodel or
otherwise make the Subleased Premises suitable for use by a Substitute Tenant unless: (1) Subtenant pays
any such amount to Sublandlord prior to Sublandlord's execution of a lease with such Substitute Tenant
(which payment shall not relieve Subtenant of any amount it owes Sublandlord as a result of Subtenant's
default under this Agreement); or (2) Sublandlord, in Sublandlord's sole discretion, determines any such
expenditure is financially prudent in connection with entering into a lease with the Substitute Tenant.
24. Holding Over. If Subtenant fails to vacate the Subleased Premises at the end of the Lease
Term, then Subtenant shall be a tenant at sufferance and, in addition to all other damages and remedies to
which Sublandlord may be entitled for such holding over, Subtenant shall pay, in addition to the other
amounts payable hereunder, Rent equal to 150% of the Rent payable during the last month of the Lease
Term, and Subtenant shall otherwise continue to be subject to all of Subtenant's obligations under this
Agreement. The provisions of this Paragraph 24 shall not be deemed to limit or constitute a waiver of any
other rights or remedies of Sublandlord provided herein or at law. If Subtenant fails to surrender the
Subleased Premises upon the termination or expiration of this Agreement, in addition to any other liabilities
10
4854-6732-4772v.8
DocuSign Envelope ID: 99E4FO40-F373-44CE-92C6-OCE893E38EB5
to Sublandlord accruing therefrom, Subtenant shall protect, defend, indemnify and hold Sublandlord
harmless from all loss, costs (including reasonable attorneys' fees) and liability resulting from such failure,
including any claims made by any succeeding tenant founded upon such failure to surrender, and any lost
profits or other consequential damages to Sublandlord resulting therefrom.
25. Estonael Certificates. From time to time, Subtenant shall furnish to any party designated
by Sublandlord, within ten (10) business days after Sublandlord has made a request therefor, a certificate
signed by Subtenant confirming and containing such factual certifications and representations as to this
Agreement as Sublandlord may reasonably request.
26. Notice. Any notice hereunder must be in writing. Notice deposited or sent by nationally
recognized overnight courier service, such as, but not limited to, Federal Express, by certified mail with
return receipt requested, or by express snail properly addressed, postage paid, shall be effective upon
deposit. Notice given in any other manner herein shall be effective upon receipt at the address of the
addressee. For purposes of notice, the addresses of the parties shall, unless changed as hereinafter provided,
be as follows:
To Sublandlord:
Alliance Al No. 1, LLC
9800 Hillwood Parkway, Suite 300
Fort Worth, TX 76177
Attention: Ian Kinne
With a copy to:
Alliance Al No. 1, LLC
9800 Hillwood Parkway, Suite 300
Fort Worth, TX 76177
Attention: Associate General Counsel
For payment of Rent:
Alliance Al No. 1, LLC
9800 Hillwood Parkway, Suite 300
Fort Worth, TX 76177
To Subtenant:
Gatik Al Inc.
161 E. Evelyn Ave.
Mountain View, CA 94041
Attention: Legal
Email: legal@ gatik. ai
The parties hereto shall have the continuing right to change their respective address by giving at least ten
(10) days' notice to the other party.
27. Subtenant's Cancellation Right. Subtenant may cancel and terminate this Agreement as
to the Subleased Premises demised to Subtenant as of the Effective Date effective as of last day of the 48"'
Lease Month by delivering to Sublandlord at least six full calendar months before the cancellation date (a)
written notice thereof and (b) $197,097.98 (the "Cancellation Fee"). As a condition to the effectiveness
of Subtenant's cancellation right, Subtenant shall pay to Sublandlord prior to the cancellation date any past -
due amounts then outstanding under this Agreement. Subtenant's rights under this Section 27 shall
terminate, at Sublandlord's option, if (i) an uncured Event of Default exists when Subtenant delivers the
cancellation notice or on the cancellation date, (ii) Subtenant assigns its interest in this Agreement (other
than to an Affiliate) or sublets any portion of the Subleased Premises, (iii) Subtenant fails to timely deliver
the Cancellation Fee or the cancellation notice or is otherwise unable to exercise this cancellation right,
time being of the essence with respect thereto, or (iv) Subtenant has leased additional space in the Leased
Premises. If Subtenant delivers the cancellation notice to Sublandlord, Subtenant shall have no further
rights to extend or renew the Lease Term, and shall have no option to lease additional space in the Leased
11
4854-6732-4772v.8
DocuSign Envelope 1D: 99E4F040-F373-44CE-92C6-0CE893E38EB5
Premises or any rights of first offer, rights of first opportunity or rights of first refusal with respect to space
in the Leased Premises; accordingly any provision of this Agreement granting Subtenant an extension or
renewal option or any option to lease additional space in the Leased Premises or any rights of first offer,
rights of first opportunity or rights of first refusal with respect to space in the Leased Premises shall be
automatically deleted in their entirety as of the date of Subtenant's delivery of the cancellation notice to
Sublandlord, without the need for any additional documentation. As used herein, "Affiliate" means any
person or entity which, directly or indirectly, through one or more intermediaries, controls, is controlled by,
or is under common control with the party in question.
28. Confidentiality. Both Sublandlord and Subtenant acknowledge that the terms and
conditions of this Agreement (other than the existence of this Agreement and the location of the Subleased
Premises) are to remain confidential for both parties' benefit, and may not be disclosed by either party to
anyone, by any manner or means, directly or indirectly, without the other party's prior written consent;
however, Sublandlord or Subtenant may disclose the terms and conditions of this Agreement to its
respective attorneys, accountants, employees and existing or prospective financial partners. The disclosing
party shall be liable for any disclosures made in violation of this Section by the disclosing party or by any
entity or individual to whom the terms of and conditions of this Agreement were disclosed or made available
by the disclosing party. The consent by either party to any disclosures shall not be deemed to be a waiver
on the part of such party of any prohibition against any future disclosure. Notwithstanding anything to the
contrary herein, Sublandlord and Subtenant shall each have the right to make disclosures of the terms of
this Agreement (a) to the extent required by law (including disclosures that are reasonably necessary to
comply with rules of any stock exchange), (b) to the extent reasonably necessary to enforce such party's
rights hereunder, (c) in connection with such parry's financing, selling, leasing, or otherwise transferring
or capitalizing its assets or its business (or any such transaction consummated by such party's affiliate), (d)
in connection with such party's books and records being audited, (e) to the extent necessary reasonably
necessary in constructing, operating, maintaining, repairing or restoring the Subleased Premises or the other
portions of the Property, and (f) pursuant to a press release which has been approved by both parties. Except
for disclosures made pursuant to subparagraphs (a),(b) and (f) of the immediately preceding sentence, the
disclosing party shall advise all parties to whom the disclosing party is permitted to disclose the terms and
conditions of this Agreement pursuant to this Section 28 of the confidential nature of such terms and
conditions prior to disclosure and the disclosing party shall be responsible for any violation of the terms of
this Section 28 by any such receiving party.
29. Determination of Char. Sublandlord and Subtenant agree that each provision of this
Agreement for determining charges and amounts payable by Subtenant (including provisions regarding
Rent) is commercially reasonable and, as to each such charge or amount, constitutes a statement of the
amount of the charge or a method by which the charge is to be computed for purposes of Section 93.012 of
the Texas Property Code.
30, No Construction Contract. Sublandlord and Subtenant acknowledge and agree that this
Agreement, including all exhibits a part hereof, is not a construction contract or an agreement collateral to
or affecting a construction contract.
31. Prohibited Persons and Transactions. Subtenant represents and warrants to Sublandlord
it is not, and covenants and agrees that it will not become, a person or entity with whom U.S. persons or
entities are restricted from doing business under regulations of the Office of Foreign Assets Control
("OFAC") of the Department of the Treasury (including those named on OFAC's Specially Designated
Nationals and Blocked Persons List) or under any statute, executive order (including the September 24,
2001, Executive Order Blocking Property and Prohibiting Transactions with Persons Who Commit,
Threaten to Commit, or Support Terrorism), or other governmental action, and Subtenant covenants and
12
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DocuSign Envelope ID: 99E4F040-F373-44CE-92C6-OCE893E38EB5
agrees that it will not transfer this Agreement to any such persons or entities (and any such transfer shall be
void).
32. Waiver of Consumer Ri:hts. Subtenant hereby waives all its rights under the Texas
Deceptive Trade Practices - Consumer Protection Act, Section 17.41 et seq. of the Texas Business and
Commerce Code, a law that gives consumers special rights and protections. After consultation with
an attorney of Subtenant's own selection, Subtenant voluntarily adopts this waiver.
33. BrokeraLee. Neither Sublandlord nor Subtenant has dealt with any broker or agent in
connection with the negotiation or execution of this Agreement. Sublandlord and Subtenant shall each
indemnify the other against all costs, expenses, attorneys' fees, liens and other liability for commissions or
other compensation claimed by any broker or agent claiming the same by, through or under the
indemnifying party.
34. Sublandlord Transfer. Sublandlord may transfer any portion of its rights under this
Agreement. If Sublandlord assigns its rights under this Agreement, then Sublandlord shall thereby be
released from any further obligations hereunder arising after the date of transfer, provided that the assignee
assumes in writing Sublandlord's obligations hereunder arising from and after the transfer date.
35. Sublandlord's Liabilitv. The liability of Sublandlord (and its successors, partners,
shareholders or members) to Subtenant (or any person or entity claiming by, through or under Subtenant)
for any default by Sublandlord under the terms of this Agreement or any matter relating to or arising out of
the occupancy or use of the Leased Premises shall be limited to Subtenant's actual direct, but not
consequential, damages therefor and shall be recoverable only from the amount which is equal to the equity
interest of Sublandlord in its leasehold interest in the Subleased Premises. Further, Sublandlord (and its
successors, partners, shareholders or members) shall not be personally liable for any deficiency, and in no
event shall any liability hereunder extend to any sales or insurance proceeds received by Sublandlord (or
its successors, partners, shareholders or members) in connection with the Leased Premises. Additionally,
Subtenant hereby waives all lien rights on the Leased Premises and Sublandlord's property and all
termination rights provided under law or equity, including Section 91.004 and Section 93.002(g) of the
Texas Property Code. The provisions of this Paragraph shall survive the expiration or earlier termination
of this Agreement.
36. Consent of Cih% This Agreement is expressly conditioned on City's consent to this
Agreement, which Sublandlord agrees to use commercially reasonable efforts to pursue.
37. Subordination: Prime Lease Incorporated.
(a) This Agreement shall be subordinate to any deed of trust, mortgage, or other
security instrument (each, a "Mortgage") or any ground lease, master lease, or primary lease (including the
Prime Lease), that now or hereafter covers all or any part of the Subleased Premises (the mortgagee under
any such Mortgage or beneficiary under any such deed of trust is referred to herein as a "Sublandlord's
Mortm!ee"). Sublandlord represents and warrants that no such Mortgage currently encumbers the
Subleased Premises as of the Effective Date. Sublandlord shall use reasonable efforts to obtain a
subordination, non -disturbance and attornment agreement from any future Sublandlord's Mortgagee, on
such Sublandlord's Mortgagee's standard form therefor with such changes as Subtenant and such
Sublandlord's Mortgagee may agree; however, Sublandlord's failure to obtain such agreement shall not
constitute a default by Sublandlord hereunder or in any manner affect Subtenant's obligations and liabilities
under this Agreement or prohibit the mortgaging of the Building or Property; and further provided that any
costs associated with obtaining such subordination, non -disturbance and attornment agreement shall be paid
by Subtenant within fifteen (15) days after Sublandlord's written request therefor. As used in this Section
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DocuSign Envelope ID: 99E4F040-F373-44CE-92C6-OCE893E38EB5
37(a), "reasonable efforts" shall not be deemed to include the incurrence by Sublandlord of any additional
expense (unless Subtenant agrees in writing to reimburse Sublandlord for all such expenses) or liabilities
or obligations with respect to Sublandlord's Mortgagee.
(b) The provisions of the Prime Lease are, except as otherwise herein specifically
provided, hereby incorporated in this Agreement with the same effect as if entirely rewritten herein, and
shall fix the rights and obligations of the parties hereto with respect to the Subleased Premises with the
same effect as if Sublandlord and Subtenant were, respectively, "City" (as landlord) and "Subtenant" (as
tenant) named in the Prime Lease. Subtenant hereby covenants to perform the covenants and undertakings
of Sublandlord as tenant under the Prime Lease to the extent the same are applicable to the Subleased
Premises during the term of this Agreement, and agrees not to do or permit to be done any act which shall
result in a violation of any of the terms and conditions of said Prime Lease. Sublandlord hereby covenants
to perform all other covenants and undertakings of Sublandlord as tenant under the Prime Lease to the
extent the same are not applicable to the Subleased Premises, and agrees not to do or permit to be done any
act which shall result in a tenant default beyond any applicable notice and cure periods of said Prime Lease.
This Agreement is subject and, as described above, subordinate in all respects to said Prime Lease.
Subtenant acknowledges that it has received a copy of the Prime Lease. This Agreement shall terminate
upon any termination of the Prime Lease, unless Sublandlord and Subtenant elect in writing (with the City's
approval, if required), to cause Subtenant to attorn to and recognize City as the landlord under this
Agreement. Notwithstanding anything to the contrary set forth in this Paragraph 37(b), (1) in the event of
any inconsistency or redundancy between this Agreement and the Prime Lease, the terms of this Agreement
shall control for all purposes, (2) to the extent any particular matter is addressed in this Sublease (e.g.,
obligations of Subtenant with respect to payment of rent, maintenance and repair, insurance, among others),
the terms of this Sublease shall be deemed to supersede the terms of the Prime Lease as between
Sublandlord and Subtenant, and (3) any terms of the Prime Lease that are by their nature or by context not
relevant or intended to be applicable to Subtenant or Subtenant's occupancy of the Subleased Premises
(e.g., termination or extension options) shall not be deemed to apply to Subtenant, including, without
limitation, the following: Paragraph 6 of the Prime Lease (Termination Option), Paragraph 11 of the Prime
Lease (Improvements), Paragraph 25 of the Prime Lease (Audit).
The provisions of this Paragraph 37 shall be self -operative and no further instrument of subordination shall
be required; however, in confirmation of such subordination or Subtenant's attornment obligations,
Subtenant shall execute and return to Sublandlord (or such other party designated by Sublandlord) within
twenty (20) days after written request therefor such documentation, in recordable form if required, as
Sublandlord may reasonably request to evidence the subordination of this Agreement to the Prime Lease
and Subtenant's obligation to attorn to and recognize City as the landlord under this Agreement if
Sublandlord and Subtenant so elect.
38. Net Lease. The Rent shall be paid in addition to and over and above all other payments to
be made by Subtenant pursuant to this Agreement, it being the intention and purpose of this Agreement that
the Rent shall be absolutely net to Sublandlord so that this Agreement shall yield net to Sublandlord the
Rent, and that all costs, expenses, and obligations of every kind and nature whatsoever relating to the
Subleased Premises which may arise or become due during the Lease Term shall be paid and discharged
by Subtenant.
39. Marketing. With Subtenant's prior approval, not to be unreasonably withheld,
conditioned or delayed, Sublandlord and Sublandlord's affiliate may include Subtenant's name and logo in
marketing materials for developments owned, leased or operated by Sublandlord or Sublandlord's affiliate,
for the limited purpose of informing third parties that Subtenant is occupying the Subleased Premises.
14
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DocuSign Envelope ID: 99E4F040-F373-44CE-92C6-OCE893E38EB5
40. Ouiet Eniovment. Except during the continuation of an Event of Default beyond all
applicable notice and cure periods, Subtenant shall peaceably and quietly hold and enjoy the Subleased
Premises for the Lease Tenn, without hindrance from Sublandlord or any party claiming by, through or
under Sublandlord, subject to the terns and conditions of this Agreement.
41. Entire Agreement; Arms' -Len tg h Negotiation; No Reliance. This Agreement and the
Confidentiality Agreement constitutes the entire agreement between Sublandlord and Subtenant relating to
the use of the Subleased Premises and no prior written or oral covenants or representations relating thereto
not set forth herein shall be binding on either party hereto. Except for those set forth in this Agreement and
the Confidentiality Agreement, no representations, warranties, or agreements have been made by
Sublandlord or Subtenant to the other with respect to this Agreement or the obligations of Sublandlord or
Subtenant in connection therewith. Sublandlord and Subtenant agree that they have both had the
opportunity to retain legal counsel to review, revise, and negotiate this Agreement on their individual
behalf. Sublandlord and Subtenant stipulate that this Agreement has been reviewed and revised by both
Sublandlord and Subtenant and their respective legal counsel and that this Agreement is the result of an
arms' -length negotiation and compromise. Sublandlord and Subtenant further stipulate that they are both
sophisticated individuals or business entities capable of understanding and negotiating the terms of this
Agreement. The normal rule of construction that any ambiguities be resolved against the drafting party
shall not apply to the interpretation of this Agreement or any exhibits or amendments hereto. Further,
Subtenant disclaims any reliance upon any and all representations, warranties or agreements not expressly
set forth in this Agreement.
42. Waiver of Jury Trial. TO THE MAXIMUM EXTENT PERMITTED BY LAW,
SUBLANDLORD AND SUBTENANT (ON BEHALF OF ITSELF AND SUCCESSORS AND
ASSIGNS) EACH, AFTER CONSULTATION WITH COUNSEL, KNOWINGLY WAIVES ANY
RIGHT TO TRIAL BY JURY IN ANY LITIGATION OR TO HAVE A JURY PARTICIPATE IN
RESOLVING ANY DISPUTE ARISING OUT OF OR WITH RESPECT TO THIS AGREEMENT
OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR
DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS RELATED HERETO.
Each party further acknowledges and agrees that this Paragraph has been negotiated at arms' -length with
the assistance of legal counsel and the legal effect fully explained, and that its provisions constitute a
knowing and voluntary agreement.
43. Hazardous Materials, Environmental Requirements.
(a) Prohibition against Hazardous Materials. Except for Hazardous Materials
contained in products used by Subtenant in de minimis quantities for ordinary cleaning and office purposes
or as permitted under Paragraph 1, Subtenant shall not permit or cause any party to bring any Hazardous
Materials upon the Leased Premises or transport, store, use, generate, manufacture or Release (defined
below) any Hazardous Materials on or from the Leased Premises without Sublandlord's prior written
consent. As used herein, "Release" means depositing, spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping or disposing. Subtenant, at its sole cost and
expense, shall operate its business in the Subleased Premises in strict compliance with all Environmental
Requirements and all requirements of this Agreement. Subtenant shall complete and certify to disclosure
statements as requested by Sublandlord from time to time relating to Subtenant's transportation, storage,
use, generation, manufacture or Release of Hazardous Materials on the Leased Premises, and Subtenant
shall promptly deliver to Sublandlord a copy of any notice of violation relating to the Leased Premises of
any Environmental Requirement.
(b) Environmental Requirements. The term "Environmental Requirements"
means all laws regulating or relating to health, safety, or environmental conditions on, under, or about the
15
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DocuSign Envelope ID: 99E4F040-F373.44CE-92C6-0CE893E38EB5
Leased Premises or the environment including the following: the Comprehensive Environmental Response,
Compensation and Liability Act; the Resource Conservation and Recovery Act; the Clean Air Act; the
Clean Water Act; the Toxic Substances Control Act and all state and local counterparts thereto, and any
common or civil law obligations including nuisance or trespass, and any other rules or requirements of
Sublandlord. The term "Hazardous Materials" means and includes any substance, material, waste,
pollutant, or contaminant that is or could be regulated under any Environmental Requirement or that may
adversely affect human health or the environment, including any solid or hazardous waste, hazardous
substance, asbestos, petroleum (including crude oil or any fraction thereof, natural gas, synthetic gas,
polychlorinated biphenyls [PCBs], and radioactive material). For purposes of Environmental
Requirements, to the extent authorized by applicable law, Subtenant is and shall be deemed to be the
responsible party, including the "owner" and "operator" of Subtenant's "facility" and the "owner" of all
Hazardous Materials brought on the Leased Premises by a Subtenant Party and the wastes, by-products, or
residues generated, resulting, or produced therefrom.
(c) Removal of Hazardous Materials. Subtenant, at its sole cost and expense, shall
remove all Hazardous Materials stored or Released by a Subtenant Parry onto or from the Leased Premises,
in a manner and to a level satisfactory to Sublandlord in its sole discretion, but in no event to a level and in
a manner less than that which complies with all Environmental Requirements and does not limit any future
uses of the Leased Premises or require the recording of any deed restriction or notice regarding the Leased
Premises. Subtenant shall perform such work at any time during the period of this Agreement upon written
request by Sublandlord or, in the absence of a specific request by Sublandlord, before Subtenant's right to
possession of the Subleased Premises terminates or expires. If Subtenant fails to perform such work within
the time period specified by Sublandlord or before Subtenant's right to possession terminates or expires
(whichever is earlier), Sublandlord may at its discretion, and without waiving any other remedy available
under this Agreement or at law or equity (including an action to compel Subtenant to perform such work),
perform such work at Subtenant's cost. Subtenant shall pay all costs incurred by Sublandlord in performing
such work within thirty (30) days after Sublandlord's request therefor. Such work performed by
Sublandlord is on behalf of Subtenant and Subtenant remains the owner, generator, operator, transporter,
and/or arranger of the Hazardous Materials for purposes of Environmental Requirements. Subtenant agrees
not to enter into any agreement with any person, including any governmental authority, regarding the
removal of Hazardous Materials that have been Released onto or from the Leased Premises without the
written approval of the Sublandlord.
(d) Subtenant's Indemnih . Subtenant shall indemnify, defend, and hold
Sublandlord harmless from and against any and all losses (including diminution in value of the Leased
Premises and loss of rental income from the Leased Premises), claims, demands, actions, suits, damages
(including punitive damages), expenses (including remediation, removal, repair, corrective action, or
cleanup expenses), and costs (including actual attorneys' fees, consultant fees or expert fees and including
removal or management of any asbestos brought onto the Leased Premises or disturbed in breach of the
requirements of this Paragraph 43, regardless of whether such removal or management is required by law)
which are brought or recoverable against, or suffered or incurred by Sublandlord as a result of any Release
of Hazardous Materials or any breach of the requirements under this Paragraph 43 by a Subtenant Parry
regardless of whether Subtenant had knowledge of such noncompliance. This indemnity provision is
intended to allocate responsibility between Sublandlord and Subtenant under environmental laws and shall
survive termination or expiration of this Agreement. In no event shall Subtenant's indemnity obligations
set forth herein extend to a release of Hazardous Materials on or from the Leased Premises, Property or
Building to the extent such release occurred prior to the Effective Date.
(e) Inspections and Tests. Sublandlord shall have access to, and a right to perform
inspections and tests of, the Subleased Premises to determine Subtenant's compliance with Environmental
Requirements, its obligations under this Paragraph 43, or the environmental condition of the Subleased
16
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DocuSign Envelope ID: 99E4F040-F373-44CE-92C6-0CE893E38EB5
Premises. Access to the Subleased Premises shall be granted to Sublandlord upon Sublandlord's prior
notice to Subtenant and in accordance with the terms of Paragraph 1. Such inspections and tests shall be
conducted at Sublandlord's expense, unless such inspections or tests reveal that Subtenant has not complied
with any Environmental Requirement, in which case Subtenant shall reimburse Sublandlord for the
reasonable cost of such inspection and tests. Sublandlord's receipt of or satisfaction with any environmental
assessment in no way waives any rights that Sublandlord holds against Subtenant. Subtenant shall promptly
notify Sublandlord of any communication or report that Subtenant makes to any governmental authority
regarding any possible violation of Environmental Requirements or Release or threat of Release of any
Hazardous Materials onto or from the Leased Premises. Subtenant shall, within five (5) days of receipt
thereof, provide Sublandlord with a copy of any documents or correspondence received from any
governmental agency or other party relating to a possible violation of Environmental Requirements or claim
or liability associated with the Release or threat of Release of any Hazardous Materials onto or from the
Leased Premises.
(f) Subtenant's Financial Assurance in the Event of a Breach. In addition to all
other rights and remedies available to Sublandlord under this Agreement or otherwise, Sublandlord may,
in the event of a breach of the requirements of this Paragraph 43 that is not cured within thirty (30) days
following notice of such breach by Sublandlord, require Subtenant to provide financial assurance (such as
insurance, escrow of funds or third party guarantee) in an amount and form satisfactory to Sublandlord.
The requirements of this Paragraph 43 are in addition to and not in lieu of any other provision in this
Agreement.
44. Governina Law: Jurisdiction. This Agreement shall be governed by and construed in
accordance with the laws of the state in which the Subleased Premises are located. The proper place of
venue to enforce this Agreement will be the county or district in which the Subleased Premises are located.
45. Joint and Several Liabilit- . If Subtenant consists of more than one party (or if Subtenant
permits any other party to occupy the Subleased Premises), each such party shall be jointly and severally
liable for Subtenant's obligations under this Agreement. All unperformed obligations of Subtenant
hereunder not fully performed at the end of the Lease Term shall survive the end of the Lease Term,
including payment obligations with respect to Rent and all obligations concerning the condition and repair
of the Subleased Premises.
46. Amendment. This Agreement may not be amended, modified, extended, or supplemented
except by written instrument executed by both Sublandlord and Subtenant.
47. Countervarts. This Agreement may be executed in several counterparts, each of which
shall be deemed an original, but all of which shall constitute but one and the same document.
(SIGNATURES APPEAR ON FOLLOWING PAGE)
17
4854-6732-4772v.8
DocuSign Envelope ID: 99E4FO40-F373-44CE-92C6-OCE893E38EB5
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as the
day and year first above set forth.
SUBLANDLORD: SUBTENANT:
ALLIANCE Al NO. 1, LLC, a Texas limited GATIK Al INC., a Delaware corporation
liability company �1) Sig ad tw cj_;
(�noe„s+gneuey: BJ- �1��ItN.IY1�/l+t
BJ,. . �,,ik,((, (A � VL .�-At3E80841F6203-
F18T7326C9BB4C8... Name:Gautam Narang
Name: L • Russell Laughlin
Title: CEO
Title: EVP
p Date: 7/12/2023
1 Date: �/12/2023
[Signature Page]
DocuSign Envelope ID: 99E4F040-F373-44CE-92C6-0CE893E38EB5
EXHIBIT A
LEGAL DESCRIPTION OF THE PROPERTY
iy 7T611"
BEING a tract of land situated in the G. Overton Survey, Abstract Number 972, Denton County, Texas,
being a portion of that tract of land described by deed to The City of Fort Worth, recorded in Instrument
Number 2015-12544, Real Property Records, Denton County, Texas, also known as Lot 1, Block 1,
American Airlines Maintenance Base, an addition to the City of Fort Worth, recorded in Cabinet A, Slide
593, County Records, Tarrant County, Texas, being more particularly described by metes and bounds as
follows:
COMMENCING at the southwest corner of said Lot 1, Block 1;
THENCE N 04058'35"E, 1805.48 feet, to the POINT OF BEGINNING;
THENCE N 10024'56"W, 375.52 feet;
THENCE N 79035'05"E, 290.00 feet;
THENCE S 10024'56"E, 375.52 feet;
THENCE S 79035'05"W, 290.00 feet to the Point of Beginning and containing 108,901 square feet or
2.500 acres of land more or less.
TRACT 2:
BEING a tract of land situated in the G. Overton Survey, Abstract Number 972, Denton County, Texas,
being a portion of that tract of land described by deed to The City of Fort Worth, recorded in Instrument
Number 2015-12544, Real Property Records, Denton County, Texas, also known as Lot 1, Block 1,
American Airlines Maintenance Base, an addition to the City of Fort Worth, recorded in Cabinet A, Slide
593, County Records, Tarrant County, Texas, being more particularly described by metes and bounds as
follows:
COMMENCING at the southwest corner of said Lot 1, Block 1;
THENCE N 05050'08"W, 1749.45 feet, to the POINT OF BEGINNING;
THENCE N 10025'21"W, 357.22 feet;
THENCE N 34000'47"E, 21.23 feet;
THENCE N 79035'05"E, 324.69 feet;
THENCE S 10024'56"E, 372.38 feet;
THENCE S 79035'05"W, 339.51 feet to the Point of Beginning and containing 126,321 square feet or
2.900 acres of land more or less.
A-1
4854-6732-4772v.8
DocuSign Envelope ID: 99E4F040-F373-44CE-92C6-OCE893E38EB5
EXHIBIT B
DEPICTION OF THE SUBLEASED PREMISES
Subleased Premises
B-1
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DocuSign Envelope ID: 99E4F040-F373-44CE-92C6-0CE893E38EB5
EXHIBIT C
SUBTENANT'S INSURANCE
Effective as of the earlier of (a) the date Subtenant enters or occupies the Subleased Premises, or
(b) the commencement of the Lease Term, and continuing throughout the Lease Term, Subtenant shall
maintain the following insurance policies:
1. commercial general liability insurance (including property damage, bodily injury and
personal injury coverage) in amounts of $1,000,000 per occurrence and $2,000,000 in the annual aggregate
on a per location basis in primary coverage, with an additional $5,000,000 in umbrella coverage on a per
location basis which may be taken out under a blanket insurance policy or policies covering other premises,
property or insureds in addition to the Subleased Premises and Subtenant, provided the commercial general
liability and umbrella coverages are on a per location aggregate basis (or contain a per location aggregate
endorsement) and such blanket policy or policies otherwise comply with this Exhibit C or, following the
expiration of the initial Lease Term, such other amounts as are standard for comparable buildings in the
submarket in which the Building is located, insuring Subtenant (and listing the Sublandlord Insured Parties
as additional insureds), against liability for injury to or death of a person or persons or damage to property
arising from the use and occupancy of the Subleased Premises, operations, independent contractors,
products -completed operations, personal injury, advertising injury, and liability under assumed contracts
(and if the use and occupancy of the Subleased Premises include any activity or matter that is or may be
excluded from coverage under a commercial general liability policy [e.g., the sale, service, distribution or
consumption of alcoholic beverages], Subtenant shall obtain such endorsements to the commercial general
liability policy or otherwise obtain insurance to insure all liability arising from such activity or matter
[including liquor liability, if applicable] in such amounts as Sublandlord may reasonably require);
2. cause of loss -special risk form (formerly "all-risk") or its equivalent insurance (including
sprinkler leakage, theft, boiler and machinery, ordinance and law, sewer back-up, pipe burst, wind driven
rain, water leakage, flood, earthquake, windstorm and collapse coverage) covering the full value of all
alterations and improvements and betterments in the Subleased Premises (including the Building), naming
Sublandlord and City as additional loss payees as their interests may appear;
3. cause of loss -special risk form (formerly "all-risk") or its equivalent insurance covering
the full value of all furniture, trade fixtures, equipment and personal property (including property of
Subtenant or others) in the Subleased Premises by or on behalf of a Subtenant Party;
4. builder's risk or property insurance during the course of construction with an installation
floater where applicable;
5. commercial auto liability insurance covering automobiles owned, hired, non -owned or
used by Subtenant in carrying on its business with limits not less than $1,000,000 combined single limit for
each accident, insuring Subtenant (and listing the Sublandlord Insured Parties as additional insureds);
6. worker's compensation insurance of $1,000,000 (or such larger amount as required by
applicable state law), including provisions for voluntary benefits as required in labor agreements, and
employer's liability insurance with limits of not less than $1,000,000 each accident, $1,000,000 disease
policy limit, and $1,000,000 disease each employee;
7. business interruption and extra expense insurance in an amount typically carried by prudent
tenants engaged in similar operations, but in no event in an amount less than double the annual Rent then
in effect;
8. comprehensive crime coverage of $1,000,000; and
C-1
4854-6732-4772v.8
DocuSign Envelope 1D: 99E4FO40-F373-44CE-92C6-OCE893E38EB5
9. environmental impairment liability insurance insuring Subtenant (and listing the
Sublandlord Insured Parties as additional insureds) against all liability for environmental damage, including
third party property damage and bodily injury liability, as well as the cost of investigation and remediation
(and insuring pollution hazards from cargo), arising from the use and occupancy of the Subleased Premises
and, with limits of not less than $2,000,000 per claim and $2,000,000 in the aggregate.
In addition, Subtenant shall cause all vendors, architects and design professionals,
contractors and subcontractors to procure and maintain insurance coverage (and listing the Sublandlord
Insured Parties as additional insureds) against such risks, in such amounts, and with such companies as
Sublandlord may reasonably require, including insurance similar to insurance Subtenant is obligated to
maintain pursuant to this Exhibit C. Notwithstanding the foregoing, Subtenant may elect to self -insure for
the risks that would be covered under the insurance required under Sections 7, 8 and 9 of this Exhibit C.
As used in this Agreement, "Sublandlord Insured Parties" means Sublandlord, Sublandlord's
property management company, Sublandlord's asset management company, as each of the foregoing may
be changed by Sublandlord from time -to -time, and their associated, affiliated, and subsidiary companies,
owners, directors, officers, managing agents, and fiduciaries, as they exist, and City, in each case of whom
Sublandlord shall have given notice to Subtenant, and any other party that Sublandlord may reasonably
designate in writing from time to time. The additional insureds will be entitled to the limits stated in this
Agreement, or the full limits of the insurance policies maintained by Subtenant, whichever are greater.
Subtenant's insurance shall be primary and non-contributory when any policy issued to
Sublandlord, or self -insured by Sublandlord, provides duplicate or similar coverage, and in such
circumstance Sublandlord's policy will be excess over Subtenant's policy. Subtenant shall furnish to
Sublandlord certificates of such insurance and such other evidence satisfactory to Sublandlord of the
maintenance of all insurance coverages required hereunder at least ten (10) days prior to the earlier of the
commencement of the Lease Term or the date Subtenant enters or occupies the Subleased Premises (in any
event, within ten [10] days of the effective date of coverage), and at least fifteen (15) days prior to each
renewal of said insurance (unless Subtenant is still negotiating the renewal of such insurance, in which
event Subtenant shall provide evidence at least fifteen [15] days prior to the scheduled expiration of
Subtenant's insurance policy or policies that Subtenant's existing insurance policies will continue in place
beyond expiration until such renewal, and upon the actual renewal of Subtenant's insurance policies
Subtenant shall provide evidence of such renewal without any lapse in coverage), and Subtenant shall
endeavor to ensure that each of its policies requires the insurance company to notify Sublandlord at least
thirty (30) days before cancellation of such policy, or if that is not possible, Subtenant shall so notify
Sublandlord in writing at least thirty (30) days before such cancellation. All such insurance policies shall
be in form reasonably satisfactory to Sublandlord and issued by companies with an A.M. Best rating of
A+:VIII or better. However, no review or approval of any insurance certificate or policy by Sublandlord
shall derogate from or diminish Sublandlord's rights or Subtenant's obligations hereunder. If Subtenant
fails to comply with the foregoing insurance requirements or to deliver to Sublandlord the certificates or
evidence of coverage required herein, Sublandlord, in addition to any other remedy available pursuant to
this Agreement or otherwise, may, but shall not be obligated to, obtain such insurance and Subtenant shall
pay to Sublandlord on demand the premium costs thereof, plus an administrative fee of 15% of such cost.
C-2
4854-6732-4772v.8
M&C Review
Page 1 of 2
CITY COUNCIL AGENDA
Create New From This M&C
DATE: 9/12/2023 REFERENCE M&C 23-0763 LOG NAME
NO..
CODE: L TYPE: NON- PUBLIC
CONSENT HEARING:
Official site of the City of Fort Worth, Texas
FORT WORT II
21ALLIANCE Al N01
LEASE AMENDMENT
(<Le7
SUBJECT: (CD 10) Authorize the Execution of an Amendment to the Lease Agreement with
Alliance Al No. 1, LLC to Extend the Lease Term and Allow for Subleasing the Leased
Premises Located at the Alliance Fort Worth Maintenance Base to Any Entity with City of
Fort Worth Approval
RECOMMENDATION:
It is recommended that the City Council authorize the execution of an amendment to the lease
agreement with Alliance Al No. 1. LLC to extend the lease term and allow for subleasing the leased
premises located at the Alliance Fort Worth Maintenance Base to any entity with City of Fort Worth
approval.
DISCUSSION:
On September 29, 2020, the City of Fort Worth (City) entered into a ground lease agreement
(lease) (City Secretary Contract (CSC) # 54622) with Alliance Al No.1, LLC (Hillwood), to lease
approximately 108,900 square feet of ground space located at the Alliance Fort Worth Maintenance
Base (Base) for Hillwood to construct a 9,800 square foot truck maintenance facility to sublease to
TuSimple, Incorporated (TuSimple) for their autonomous commercial trucking operations.
On January 15, 2022, the parties entered into the first amendment to the lease (CSC# 54622-A1) to
add a certain piece of land, contiguous to the property, consisting of approximately 126,324 square
feet of ground space to the property.
On May 16, 2023, Hillwood notified the City of TuSimple's termination of the sublease of the leased
premises.
The original lease (CSC#46522) only allowed Hillwood to sublease to TuSimple and now Hillwood
desires to sublease the leased premises to Gatik Al, LLC, another autonomous commercial trucking
company.
Hillwood and the City of Fort Worth Property Management Department have negotiated and agreed on
amending the lease with the following terms:
1. Sublease any or all portions of the leases premises to Gatik Al, LLC
2. Provide for the option to sublease to other entities with City approval
3. Extend the lease term to August 31, 2028 with one (1) five (5) year renewal option
4. Revise the early termination date to August 31, 2027
5, Revise the lease rental rates as follows:
Base rent for Lease Premises:
Time Period Yearly Ground Rate Per Monthly
Square Foot Rent
9/1/2023 - 3/31/2024 $0.75 $14,632.53
I
http://apps.cfwnet.org/council_packet/mc_review.asp?ID=31389&councildatc=9/12/2023 9/12/2023
M&C Review Page 2 of 2
4/1/2024 - 3/31/2025 I� $0.80 $15,583.59
4/1 /2025 - 3/31 /2026 II $0.90 $17,641.80
4/1/2026 - 3/31/2027 I $0.95 $18,621.90
4/1 /2027 - 3/31 /2028 $1.00 $19, 602.00
4/1 /2028 - 8/31 /2028 I $1.05 II $20,582.10
The annual rent rate per square foot of ground space figures are rounded approximations, and the
monthly rent amounts set forth above shall control.
This property is located in Council District 10.
FISCAL INFORMATION/CERTIFICATION:
The Director of Finance certifies that upon approval of the above recommendations and execution of
the amendment to the lease, funds will be deposited into the Alliance Maintenance Facility Fund. The
Property Management Department (and Financial Management Services) are responsible for the
collection and deposit of funds due to the City.
TO
Fund Department I Account 1 Project Program Activity Budget Reference # Amount
ID Year I (Chartfield 2) ,
FROM
Fund Department Account Project Program Activity Budget Reference #Amount
ID ID Year (Chartfield 2)
Submitted for Citv Manaoer's Office by
Oriqinatinq Department Head:
Additional Information Contact:
Dana Burghdoff (8018)
Ricardo Salazar (8379)
Mark Brown (5197)
Marilyn Schoening (7581)
ATTACHMENTS
ALLIANCE Al N01 LEASE AMENDMENT M AND C MAP.pdf (Public)
FID ALLIANCE Al N01 LEASE AMENDMENT M AND C.odf (CFW Internal)
Form 1295 for Allaince AI lease amendment 7.21.23.odf (CFW Internal)
http://apps.cfwnet.org/council_packet/mc_review.asp?ID=31389&councildate=9/12/2023 9/12/2023