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1989-0632683L NO AN ORDINANCE APPROVING AN AGREEMENT PROVIDING FOR THE LEASE OF OFFICE SPACE AT 1607 EAST MCKINNEY STREET, AND DECLARING AN EFFECTIVE DATE THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS SECTION I That the City Council of the City of Denton hereby approves an office lease agreement between the City and First State Bank of Denton for office space at 1607 East McKinney Street in accordance with the terms thereof, said agreement being attached hereto SECTION II That this ordinance shall become effective immediately upon its passage and approval PASSED AND APPROVED this the/~~ ay of 61~ 1989 RAY ST TWENS, AYOR ATTEST NIFE 'A TERS, CI Y S ~CRETARY APPROVED AS TO LEGAL FORM DEBRA ADAMI DRAYOVITCH, CITY ATTORNEY BY od A-) /I 2683L THE STATE OF TEXAS § COUNTY OF DENTON § LEASE AGREEMENT BETWEEN THE CITY OF DENTON AND FIRST STATE BANK OF DENTON This lease agreement is made the City of Denton, Texas, a principal offices at 215 East ("Lessee"), and First State Bank and entered into by and between municipal corporation with its McKinney Street, Denton, Texas of Denton ("Lessor") In consideration of the mutual covenants and agreements herein set forth, and other good and valuable consideration, Lessor does hereby demise and lease to Lessee, and Lessee does hereby lease from Lessor, office space comprising 2,013 square feet of usable space, located on the first floor of the building at 1607 East McKinney, Denton, Texas, and hereinafter called the "leased premises" ARTICLE 1 The term of this lease shall commence at 12 01 midnight on June 1, 1989, and end at 12 00 midnight on May 31, 1990, subject, however, to earlier termination as hereinafter more particularly described Lessor shall on the commencement date of the term of this lease as hereinabove set forth, place Lessee in quiet possession of the leased premises and shall secure it in the quiet possession thereof against all persons lawfully claiming the same during the entire lease term and any extensions thereof ARTICLE 2 Lessee shall pay Lessor at Box 100, Denton, Texas, as monthly rent for the leased premises, which shall be payable on the first day of each month, the sum of five hundred dollars and no/100 ($500) ARTICLE 3 Lessee shall use the leased premises only for the purpose of subleasing to Grady Matheson, Wallace Lynch and Les Holland for operating a Domino Club ARTICLE 4 Lessee acknowledges that its acceptance of possession of the leased premises constitutes a conclusive admission that it has inspected the leased premises and has found them in good condition and repair Lessee agrees to surrender the leased premises to Lessor at the end of the lease term in the same condition as when Lessee took possession, allowing for reasonable use and wear and damages by act of God, including fire and storms ARTICLE 5 Lessee shall pay for all utilities furnished the leased premises for the term of this lease, including electricity, gas, water, and telephone services Usual janitorial services, including sweeping and waxing of floors, the cleaning of windows, replacement of light bulbs or fluorescent tubes shall be performed by Lessee ARTICLE 6 A Lessor shall at its expense maintain only the roof, foundation, underground or otherwise-concealed plumbing, and the andwalls (excluding tall structural soundness of the exterior he all doors) of windows, window glass, plate glass, building in good repair and condition, except for reasonable wear and tear Lessor shall be responsible for termite eradication Lessee shall give immediate written notice to Lessor of the need for repairs or corrections and Lessor shall proceed promptly to make such repairs or corrections B Lessor represents that, at the beginning date of this Lease the plumbing, and any fire protection sprinkler system, heating system, and air conditioning equipment are in good operating condition ARTICLE 7 A Lessee shall at its expense and risk maintain all other parts of the building and other improvements on the demised premises in good repair and condition, including but not limited to repairs (including all necessary replacements) to the interior plumbing (that is not concealed), windows, window glass, plate glass, doors, heating system, air conditioning equipment, fire protection sprinkler system, elevators, and the interior of the building in general B Lessee shall throughout the lease term take good care of the building and other improvements and keep them free from waste or nuisance, and shall deliver up the premises broom-clean at the termination of this Lease in good repair and condition (reasonable wear and tear and damage by fire, tornado, or other casualty excepted) C In event Lessee should neglect reasonably to maintain the demised premises, Lessor shall have the right (but not the obligation) to cause repairs or corrections to be made and any reasonable costs therefor shall be payable by Lessee to Lessor as additional rental on the next rental installment date ARTICLE 8 Lessee shall not make any alterations, additions, or improve- ments to the leased premises without the prior written consent of Lessor Consent for non-structural alterations, additions, or improvements shall not be unreasonably withheld by Lessor Lessee shall have the right at all times to erect or install furniture and fixtures provided that Lessee complies with all applicable governmental laws, ordinances, and regulations Lessee shall have the right to remove at the termination of this lease such items so installed, however, Lessee shall, prior to the termination of this lease, repair any damage caused by such removal ARTICLE 9 Partial destruction of the leased premises shall not render this lease void or voidable, or terminate it except as herein provided If the premises are partially destroyed during the term of this lease, Lessor shall repair them, when such repairs can be made in conformity with local, state, and federal laws and regulations within sixty (60) days of the partial destruction Rent for the premises will be reduced proportionately to the extent to which the repair operations interfere with the normal conduct of Lessee's business on the premises If the repairs cannot be so made within the time limited, Lessor has the option to make them within a reasonable time thereafter, not to exceed thirty (30) days and continue this lease in effect with pro- portional rent rebate to Lessee as provided for herein If the repairs cannot be so made in sixty (60) days and if Lessor does not elect to make them within the reasonable time thereafter, either party hereto has the option to terminate this lease if the building in which the leased premises are located is more than one-third (1/3) destroyed, Lessor may, at Lessor's option, terminate the lease whether the premises are damaged or not ARTICLE 10 Lessee agrees not to assign or sublease the premises leased, any part thereof, or any right or privilege connected therewith, or to allow any other person, except Lessee's agents and employees, to occupy the premises or any part thereof, without first obtaining the Lessor's written consent Lessee's interest in this lease is not assignable by operation of law, nor is any assignment of its interest herein, without Lessor's written consent Lessor specifically agrees to Lessee's sublease of the leased premises to Grady Matheson, Les Holland and Wallace Lynch, on behalf of the Denton Domino Club Lessee shall incorporate the provisions of this lease in the sublease so that same shall be binding upon sublessees ARTICLh 11 Lessor shall pay and fully discharge all taxes, special assessments, and governmental charges of every character imposed during the term of this lease on the leased premises or any part thereof ARTICLE 12 Lessee shall have the right to erect signs on any portion of the leased premises including, but not limited to, the exterior walls of the building Lessee shall remove all signs at the termination of this lease, and shall repair any damage and close any holes caused by such removal ARTICLE 13 Lessee shall permit Lessor and their agents to enter into and upon the leased premises at reasonable times for the purpose of inspecting the same or for the purpose of maintaining or making repairs or alterations to the building ARTICLE 14 If during the term of this lease or any extension or renewal thereof, all of the leased premises should be taken for any public or quasi-public use under any governmental law, ordinance, or regulation, or by right of eminent domain, or should be sold to the condemning authority under threat of condemnation, this lease shall terminate and the rent shall be abated during the unexpired portion of this lease, effective as of the date of the taking of said premises by the condemning authority If less than all of the leased premises shall be taken for any public or quasi-public use under any governmental law, ordinance, or regulation, or by right of eminent domain, or should be sold to the condemning authority under threat of condemnation, this lease shall not terminate but Lessor shall forthwith at their sole expense, restore and reconstruct the building and other improvements, situated on the leased premises, provided such restoration and reconstruction shall make the same reasonably tenantable and suitable for the uses for which the premises are leased The rent payable hereunder during the unexpired portion of this lease shall be adjusted equitably Lessor and Lessee shall each be entitled to receive and retain such separate awards and portions of lump sum awards as may be allocated to their respective interests in any condem- nation proceedings The termination of this lease shall not affect the right of the respective parties to such awards ARTICLE 15 Lessor will not permit any mechanics' lien or liens to be placed upon the premises or the building or improvements thereon during the term hereof, and in case of the filing of any such lien Lessor will promptly pay same If default in payment thereof shall continue for twenty (20) days after written notice thereof from Lessee to Lessor, the Lessee shall have the right and privilege at Lessee's option of paying the same or any portion thereof without inquiry as to the validity thereof, and any amounts so paid, including expenses and interest, shall be an indebtedness hereunder due from Lessor to Lessee and shall be repaid to Lessee immediately on rendition of bill therefor, together with interest at nine (9%) percent per annum until repaid ARTICLE 16 Lessor is expressly given the right to assign any or all of its interest under the terms of this lease, provided, however, that Lessor agrees to give thirty (30) days written notice to Lessee of such assignment including the name and mailing address of such assignee ARTICLE 17 If Lessee shall allow the rent to be in arrears more than fifteen (15) days after written notice of such delinquency, or shall remain in default under any other condition of this lease for a period of thirty (30) days after written notice from Lessor, Lessor may at its option, with notice to Lessee, termi- nate this lease and take possession of said premises without being deemed guilty of any manner of trespass, and relet the premises or any part thereof, for all or any part of the remainder of said term, to a party satisfactory to Lessor, and at such monthly rental as Lessor may with reasonable diligence be able to secure Should Lessor be unable to relet after reasonable efforts to do so, or should such monthly rental be less than the rental Lessee was obligated to pay under this lease, or any renewal thereof, plus the expense of reletting, then Lessee shall pay the amount of such deficiency to Lessor ARTICLE 18 If Lessor defaults in the performance of any term, covenant, or condition required to be performed by Lessor under this agreement, Lessee may elect either one of the following (a) After not less than fifteen (15) days notice to Lessor, Lessee may remedy such default by any necessary action, and in connection with such remedy may pay expenses and employ counsel, all sums expended or obligations incurred by Lessee in connection therewith shall be paid by Lessor to Lessee on demand, and on failure of such reimburse- ment, Lessee may, in addition to any other right or remedy that Lessee may have, deduct the costs and expenses thereof from rent subsequently becoming due hereunder, or (b) Elect to terminate this agreement on giving at least thirty (30) days notice to Lessor of such intention, thereby terminating this agreement on the date designated in such notice ARTICLE 19 Should Lessee, or any of its successors in interest, hold over the premises, or any part thereof, after the expiration of the term of this lease, unless otherwise agreed in writing, such holding over shall constitute and be construed as tenancy from month to month only, at a rental equal to the rent payable for the last month of the term of this lease The inclusion of the preceding sentence shall not be construed as Lessor's consent for Lessee to hold over ARTICLE 20 All notices provided to be given under this agreement shall be given by certified mail or by hand delivery, addressed to the proper party, at the following address LESSOR LESSEE First State Bank Lloyd V Harrell, City Manager P 0 Box 100 215 East McKinney Denton, Texas 76201 Denton, Texas 76201 Attention ARTICLE 21 Lessee shall not create any openings in the roof or exterior walls, nor make any alterations, additions, or improvements to the demised premises without prior written consent of Lessor Consent for non-structural alterations, additions, or improve- ments shall not be unreasonably withheld by Lessor Lessee shall have the right at all times to erect or install shelves, bins, machinery, air conditioning or heating equipment, and trade fixtures, provided that Lessee complies with all applicable governmental laws, ordinances, and regulations Lessee shall have the right to remove at the termination of this Lease such items so installed, provided Lessee is not in default, however Lessee shall prior to the termination of this Lease repair any damage caused by such removal All alterations, additions, or Improvements made by Lessee shall become the property of Lessor at the termination of this Lease, however, Lessee shall promptly remove, if Lessor so elects, all alterations, additions, and improvements, and any other property placed in the premises by Lessee, who shall repair any damage caused by such removal ARTICLE 22 Lessee shall have the right to erect signs on the exterior walls of the building, securely attached to and parallel to said walls, subject to applicable laws and deed restrictions Lessee shall not erect any signs other than customary trade signs identifying its business, and shall not erect any signs on the roof or paint or otherwise deface the exterior walls of the building Lessee shall remove all signs at the termination of this Lease, and shall repair any damage and close any holes caused by such removal ARTICLE 23 A If Lessee should change its operations in the demised premises subsequent to its initial use and occupancy, and thereby cause an increase in the premium for the fire and extended coverage insurance policy carried by Lessor (the premium for said policy having been based on such initial use and occupancy of Lessee), the amount of such increase in net annual premium shall be paid to Lessor by Lessee as additional rental annually upon demand and presentation of written evidence by Lessor, whether Lessor has consented to such change of operations or not The foregoing shall not apply to any increase in premium resulting from any cause beyond the control of Lessee B Lessee shall not permit any operation to be conducted in the demised premises that would cause suspension or cancellation of the fire and extended coverage insurance policy which Lessor agrees to maintain C Any insurance which may be carried by Lessor or Lessee against loss or damage to the building and other improvements situated on the demised premises shall be for the sole benefit of the party carring such insurance and under its sole control ARTICLE 24 Lessor and its authorized agents shall have the right to enter the demised premises during normal working hours for the following purposes (a) inspecting the general conditions and state of repair of the premises, (b) the making of repairs required of Lessor, (c) the showing of the premises to any prospective purchaser, (d) or for any other reasonable purpose If Lessee shall not have renewed or extended this Lease prior to the final 30-day period of the lease term, Lessor and its authorized agents shall have the right to erect on or about the demised premises a customary sign advertising the property for lease or for sale During said 60-day period Lessor and its authorized agents shall have the right to enter the demised premises during normal working hours for the showing of the premises to prospective Lessees or purchasers ARTICLE 25 Should Lessee, or any of its successors in interest, hold over the demised premises, or any part thereof, after the expiration of the term of this Lease unless otherwise agreed in writing, such holding over shall constitute and be construed as tenancy from month to month only, at a monthly rental equal to the rent paid for the last month of the term of this Lease ARTICLE 26 Lessor warrants that it has full right and power to execute and perform this Lease and to grant the estate demised herein and that Lessee, on payment of the rent and performing the covenants herein contained, shall peaceably and quietly have, hold and enjoy the demised premises during the full term of this Lease and any extension or renewal hereof, provided, however, that Lessee accepts this Lease subject and subordinate to any recorded mortgage, deed of trust, or other lien presently existing upon the demised premises Lessor is hereby irrevocably vested with full power and authority to subordinate Lessee's interest hereunder to any mortgage, deed of trust, or other lien hereafter placed on the demised premises, and Lessee agrees upon demand to execute such further instruments subordinating this Lease as Lessor may request, provided such further subordination shall be upon the express condition that this Lease shall be recognized by the mortgagee and that the rights of Lessee shall remain in full force and effect during the term of this Lease so long as Lessee shall continue to perform all of the covenants of this Lease ARTICLE 27 Provided that at the end of the primary term of this Lease Lessee not be in default of any term, condition or covenant contained in this Lease, Lessee (but not any assignee or sublessee) shall have the right and option to renew this Lease, by written notice delivered to Lessor no later than 30 days prior to the expiration date of the primary term, for the additional term of one (1) year, under the same terms, conditions, and covenants contained herein, except A Lessee shall have no further renewal options unless expressly granted by Lessor in writing, and B The rental for the renewal term shall be based on the then prevailing rental rates for properties of equivalent quality, size, utility and location, with the length of the lease term, and credit standing of the Lessee herein, to be taken into account C Upon notification from Lessee of the exercise of this renewal option, Lessor shall within 15 days thereafter notify Lessee in writing of the proposed rental for the renewal term, Lessee shall within 15 days following receipt of same notify Lessor in writing of the acceptance or rejection of the proposed rental In event of rejection by Lessee, the renewal rental shall be determined as follows Within 15 days following notification of rejection, Lessor and Lessee shall each appoint a disinterested and qualified appraiser If these two appraisers cannot agree upon a renewal rental within 30 days following their appointment, the two appointees shall forthwith select a third disinterested and qualified appraiser, and the decision of any two appraisers shall be binding Notification in writing of this decision shall be made by the appraisers to Lessor and Lessee shall be first approved by the then President of the Denton Board of Realtors as qualified to determine rental applicable to the demised premises Lessor and Lessee shall bear the expense of the appraiser appointed by each, and the expense of the third appraiser shall be shared equally by both parties ARTICLE 28 Lessee may, prior to the execution of this lease, apply for a Certificate of occupancy to be issued by the municipality in which the demised premises are located Lessor represents that all plumbing and electrical wiring installed in the demised premises are in proper condition to permit Lessee to obtain a Certificate of Occupancy Nothing herein contained shall obligate Lessor to install any additional electrical wiring, plumbing or plumbing fixtures which are not presently existing in the demised premises, or which have not been expressly agreed upon by Lessor in writing ARTICLE 29 (a) This agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, executors, administrators, legal representatives, successors, and assigns where permitted by this agreement (b) This agreement shall be construed under and in accordance with the laws of the State of Texas, and all obligations of the parties created hereunder are performable in Denton County, Texas (c) In case any one or more of the provisions contained in this agreement shall for any reason be held to be invalid, illegal, or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other pro- vision thereof and this agreement shall be construed as if such invalid, illegal, or unenforceable provision had never been contained herein (d) This agreement constitutes the sole and only agreement of the parties hereto and supersedes any prior understandings or written or oral agreements between the parties respecting the within subject matter (e) No amendment, modification, or alteration of the terms hereof shall be binding unless the same be in writing, dated subsequent to the date hereof and duly executed by the parties hereto (f) The rights and remedies provided by this lease agreement are cumulative and the use of any one right or remedy by either party shall not preclude or waive its right to use any or all other remedies Said rights and remedies are given in addition to any other rights and parties may have by law, statute, ordi- nance, or otherwise (g) No waiver by the parties hereto of any default or breach of any term, condition, or covenant of this lease shall be deemed to be waiver of any other breach of the same or any other term, condition, or covenant contained herein (h) In the event Lessor or Lessee breaches any of the terms of this agreement whereby the party not in default employs attorneys to protect or enforce its right hereunder and prevails, then the defaulting party agrees to pay the other party reasonably attorneys' fees so incurred by such other party (1) Neither Lessor nor Lessee shall be required to perform any term, condition, or covenant in this lease so long as such performance is delayed or prevented by force ma7eure, which shall mean acts of God, strikes, lockouts, material or labor restric- tions by any governmental authority, civil riot, floods, and any other cause not reasonably within the control of Lessor or Lessee and which, by the exercise of due diligence, Lessor or Lessee is unable, wholly or in part, to prevent or overcome (J) Time is of the essence of this agreement IN WITNESS WHEREOF, the under jgn~~d Lessor a Lessee hereto execute this agreement as of the 2(~^~' day of , 1989 ~Ir CITY O DENTON, LESSE FIRST ST' BANK OF ENTONJ, LESSOR BY N LO HARRELL CITY MANAGER Title APPROVED AS TO LEGAL FORM DEBRA ADAMI DRAYOVITCH, CITY ATTORNEY BY G, CC _