2016-031FILE REFERENCE FORM 2016-031
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First Amendment to A reement - Ordinance 20-928 05/05/20 JR
ORDINANCE NO, 2016 -031
AN ORDINANCE OF THE CITY OF DENTON, TEXAS APPROVING A BUILDING LEASE
AGREEMENT BETWEEN THE CITY OF DENTON AND 4SR MULBERRY, LLC, RELATED
TO PROPERTIES LOCATED AT 215 WEST HICKORY STREET AND 216 WEST
MULBERRY STREET, DENTON, TEXAS, 76201; PROVIDING AUTHORITY FOR THE
CITY MANAGER TO EXECUTE THE AGREEMENTS SUBJECT TO FINAL LANGUAGE
APPROVAL BY THE CITY ATTORNEY; AND PROVIDING AN EFFECTIVE DATE.
WHEREAS, on June 30, 2015, the City Council held a meeting at City Hall West and
directed staff to explore options for leasing office space to relocate department staff from City Hall
West; and
WHEREAS, on August 11, 2015, the City Council held a Work Session discussion on the
cost - benefit of leasing office space versus remaining in City Hall West, and directed staff to pursue
lease options; and
WHEREAS, on September 15, 2015, the City Council adopted the Fiscal Year 2015 -16
Budget which included a funding allocation for a lease of office space for the relocation of staff
from City Hall West to commence on or around July 1, 2016;
WHEREAS, on October 20, 2015, the City Council held a Work Session to consider two
proposals for a lease of space, and selected the proposal for leasing office space, including related
parking lots, located at 215 West Hickory Street and 216 West Mulberry Street, Denton, Texas,
76201;
WHEREAS, the property located at 215 W. Hickory St., 216 W. Mulberry St., and related
parking lots are owned by 4SR Mulberry, LLC, and are encumbered by a deed of trust lien for the
benefit of The National Bank of Texas at Fort Worth; NOW, THEREFORE;
THE COUNCIL OF THE CITY OF DENTON, TEXAS ORDAINS:
SECTION 1. The recitals and findings contained in the preamble of this ordinance are
incorporated into the body of this ordinance.
SECTION 2. The City Manager, or his designee, is authorized, after the The National
Bank of Texas at Fort Worth and 4SR Mulberry, LLC, have executed the Subordination, Non -
Disturbance and Attornment Agreement, to (i) execute, on behalf of the City of Denton, a Building
Lease Agreement between the City of Denton and 4SR Mulberry, LLC; and (ii) carry out the City's
responsibilities and rights under the Building Lease Agreement, including without limitation, the
authorization to make the expenditures set forth in the Building Lease Agreement.
SECTION 3. The City Manager, or his designee, is authorized to exercise the City of
Denton's rights and duties set forth in the Building Lease Agreement.
SECTION 4. This ordinance shall become effective immediately upon its passage and
approval.
PASSED AND APPROVED this the day of t—, At , , 2016.
"11R1S WATTS, M YOR
ATTEST:
JENNIFER WALTERS, CITY SECRETARY
BY: ....
APPROVED AS TO LEGAL FORM:
ANITA BURGESS, CITY ATTORNEY
BY:
L11,7111 - c, a(4
Building Lease Agreement
Basic Information
Effective Date:
Date signed by Tenant
Landlord:
4SR Mulberry, LLC, a Texas limited liability company
Landlord's Address:
617 Primrose Court, Argyle, Texas 76226
Tenant:
City o a Texas home -rule municipal corporation,
,Denton,
Attn;.,i,�
Tenant's Address:
215 E. McKinney St., Denton, Texas 76201
Premises:
The building located at 215 W. Hickory St., the building located at 216
W. Mulberry St. (both buildings hereafter referred to as "Buildings "),
and any improvements and parking lots associated with the Buildings,
with all being situated in Denton, Denton County, Texas, and more
particularly described in the attached Exhibit "A ". "Premises" means
the Buildings and the parcels of land on which they are located as
described in Exhibit "A ".
Personal Property:
All personal property including, but not limited to, desks, tables, chairs,
credenzas, bookshelves, and file cabinets located in the Buildings as of
the Commencement Date.
Total rentable square footage
of the Buildings: 24,853 sq. /ft.
Term (months): 84 months
Commencement Date: July 1, 2016
Termination Date: Eighty Four (84) months after the Commencement Date
Base Rent (monthly): Effective Date to Thirty Six (36) Months after the Effective Date to
monthly base rent will be $33,137.00.
Thirty Seven (37) Months after the Effective Date through Sixty (60)
Months after the Effective Date the monthly base rent will be
$34,131.00.
Sixty One (61) Months after the Effective Date through the end of the
Term the monthly base rent will be $35,155.00.
Tenant's Pro Rata Share: One hundred percent (1009)
Permitted Use: General office use
Page 1 of 21- Building Lease Agreement (City of Denton and 4SR Mulberry, LLC)
A. Definitions
A.1. "Agent" means agents, contractors, employees, licensees, and, to the extent under the
control of the principal, invitees.
A.2. "Building Operating Hours" means 5:30 A.M. to 6:30 P.M. Monday through Friday, except
federal holidays.
A.3. "Common Areas" means all facilities and areas of the Buildings and the related land that are
intended and designated by Landlord from time to time for the common, general, and exclusive use of
all tenants of the Buildings. "Common Areas" do not include the DATCU Parking Lot.
A.4. "Injury" means (a) harm to or impairment or loss of property or its use, (b) harm to or death
of a person, or (c) "personal and advertising injury" as defined in the form of liability insurance Tenant is
required to maintain.
A.S. "Lienholder" means the holder of a deed of trust covering the Premises.
A.6. "Operating Expenses" includes the following that are incurred in or accrued during each
calendar year by the Landlord related to the Premises:
A.6.a. Operation, maintenance, and repair of any part of the Premises, excluding all of
such items that are expressly the obligations of Tenant herein.
A.6.b. Administrative and management fees, including accounting, information, and
professional services; management offices; and wages, salaries, benefits, reimbursable
expenses, and taxes (or allocations of them) for full -time and part-time personnel involved in
operation, maintenance, and management.
A.6.c. Property, liability, and other insurance coverages carried by Landlord, including
deductibles and risk - retention programs and an allocation of a portion of the cost of blanket
insurance policies maintained by Landlord.
A.6.d. "Real Estate Taxes" which shall include all taxes, assessments and other
governmental charges, general and special, ordinary and extraordinary, of any kind and nature
whatsoever including, but not limited to, assessments for public improvements or benefits and
any and all taxes assessed against Landlord and attributable to taxable margin levied pursuant
to Chapter 171 of the Texas Tax Code or any amendment, adjustment or replacement thereof
which shall during the Term hereof be paid, assessed, levied, imposed upon or become due and
payable and Landlord's expense in obtaining any refund or reduction of Real Estate Taxes.
A.6.e. Security services, to the extent provided or contracted for by Landlord.
AND "Operating Expenses" does not include the following regardless of when they
accrued or were incurred Landlord:
Page 2 of 21- Building Lease Agreement (City of Denton and 4SR Mulberry, LLC)
A.M. Replacement of any part of the Premises, including the mechanical, electrical,
plumbing, HVAC, elevators, fire prevention and warning, and security systems, exterior
windows, structural elements of the Buildings or the roof.
A.6.g. Repairs and general maintenance paid by insurance proceeds or condemnation
proceeds.
A.6.h. Depreciation, amortization, interest payments on the Premises or any part
thereof, and the cost of capital improvements or additions.
A.61 Expenses for repairs or maintenance related to the Premises that have been
reimbursed to Landlord under warranties or service contracts.
A.6.j. Principal payments on indebtedness secured by liens against the Buildings, or
costs of refinancing that indebtedness.
A.6.k. Any expenditures classified as capital expenses for federal income tax purposes.
A.6.1. Any expenses paid directly by Tenant pursuant to the terms of this Lease.
A.7. "Rent" means Base Rent plus any other amounts of money payable by Tenant to Landlord.
B. Tenant's Obligations
B.1. Tenant agrees to-
B.1.a. Lease the Premises and Personal Property for the entire Term beginning on the
Commencement Date and ending on the Termination Date.
B.1.b. Accept the Premises and Personal Property in their present condition "AS IS," the
Premises being currently suitable for the Permitted Use.
B.1.c. Obey (i) all laws relating to Tenant's use, maintenance of the condition, and
occupancy of the Premises and Tenant's use of any Common Areas in the Buildings; and (ii) any
requirements imposed by utility companies serving or insurance companies covering the
Premises or Buildings.
B.1.d. Pay monthly, in advance, on the first day of the month, the Rent to Landlord at
Landlord's Address.
B.1.e. Obtain and pay for all utility services used by Tenant, including but not limited to
electricity, gas, cable /internet, water, sewer and trash.
B.1.f. Pay (i) monthly, in advance, Tenant's Pro Rata Share of the monthly estimated
Operating Expenses and (ii) annually, any amount by which the actual Operating Expenses
exceed the estimated Operating Expenses, within thirty (30) days of receiving notice of such
difference from Landlord.
Page 3 of 21- Building Lease Agreement (City of Denton and 45R Mulberry, LLC)
B.1.g. Allow Landlord, subject to Section D.8, to enter the Premises to perform
Landlord's obligations, inspect the Premises and /or Personal Property, and show the Premises
to prospective purchasers or tenants.
B.1.h. Repair, replace, and maintain any part of the Premises or Personal Property that
Landlord is not obligated to repair, replace, or maintain, normal wear, including the matters set
forth below.
B.1.h.i. Tenant's repair, replacement, and maintenance obligations include, but
are not limited to, the following: (i) floor covering and raised flooring, (ii) interior
partitions, (iii) doors, (iv) the interior side of demising walls, (v) electronic, telephone,
fiber and data cabling and related equipment that is installed by or for the benefit of
Tenant and located on the Premises or in other parts of the Buildings, (vi) kitchens,
including hot water heaters, plumbing, dishwashers, ice machines, and similar facilities
serving Tenant exclusively, (vii) telephone rooms used exclusively by Tenant,
(viii) Alterations performed by Tenant or contractors retained by Tenant, including
related HVAC balancing, and (ix) all of Tenant's furnishings, trade fixtures, equipment,
and inventory.
B.1.h.ii., Tenant's repair and maintenance obligations include (i) standard
mechanical (including HVAC), electrical, plumbing (excluding sewer components not
located within the Buildings), and fire /life safety systems serving the Buildings generally,
(ii) Common Areas, (iii) exterior windows of the Buildings, (iv) elevators serving the
Buildings, (v) parking areas, excluding the DATCU Parking Lot, and (vi) landscaping.
B.1.h.iii. Tenant's financial limitations on tenant's HVAC repair and maintenance
obligations. Tenant's financial obligation for each repair or maintenance event on its
HVAC repair and maintenance obligations shall be limited to thirty five percent (35 %) of
the total value of the system as determined by a third party agreed upon by the parties.
Any repair or maintenance event that exceeds the above limitation shall be the
obligation of Landlord.
B.1.h.iv. Tenant's financial limitations on tenant's elevator repair and
maintenance obligations. Tenant's financial obligation for each repair or maintenance
event on its elevator repair and maintenance obligations shall be limited to fifty percent
(50 %) of the total value of the system as determined by a third party agreed upon by the
parties. Any repair or maintenance event that exceeds the above limitation shall be the
obligation of Landlord.
B.1.i. Promptly submit in writing to Landlord any request for repairs, replacement, and
maintenance that are the obligations of Landlord.
B.1.j. Vacate the Premises, including the Personal Property, and return all keys to the
Buildings on the last day of the Term.
B.1.k. From time to time, within ten (10) days after request from Landlord, execute an
estoppel certificate that states the Commencement Date and Termination Date of the lease,
identifies any amendments to the lease, describes any rights to extend the Term or purchase
Page 4 of 21- Building Lease Agreement (City of Denton and 4SR Mulberry, LLC)
rights, lists defaults by Landlord, and provides any other information reasonably requested. No
cure or grace period provided in this Lease shall apply to Tenant's obligations to timely deliver
an estoppel certificate.
B.1.1. Arrange with Landlord in advance for any heating, air - conditioning, or electrical
needs in excess of the services provided by Landlord and pay for such additional services as
billed by Landlord.
B.1.m. TO THE EXTENT PERMITTED AND LIMITED BY LAW, INDEMNIFY, DEFEND, AND
HOLD LANDLORD, ITS LIENHOLDER, AND THEIR RESPECTIVE AGENTS (COLLECTIVELY, THE
"LANDLORD PARTIES"), HARMLESS FROM ANY INJURY AND ANY RESULTING OR RELATED
CLAIM (INCLUDING SUMS PAID IN SETTLEMENTS OF CLAIMS), ACTION, LOSS, LIABILITY,
JUDGMENTS, DAMAGES, PENALTIES, FINES, OR REASONABLE EXPENSE, INCLUDING, WITHOUT
LIMITATION, REASONABLE ATTORNEY'S FEES, CONSULTANT FEES, EXPERT FEES AND OTHER
FEES AND COURT AND OTHER COSTS, IMPOSED ON, INCURRED BY, OR ASSERTED AGAINST
THE LANDLORD PARTIES OCCURRING ON THE PREMISES OR THE DATCU PARKING LOT
(hereafter defined).
B.1.n. Abide by any obligations contained in Section D.
B.1.o. Tenant, no later than the December 315` of each year, shall provide Landlord with
copies of any written documentation in its possession for any maintenance and repair
performed on the HVAC and elevator systems for the preceding twelve (12) months.
B.2. Tenant agrees not to-
B.2.a. Use the Buildings for any purpose other than the Permitted Use.
B.2.b. Create any nuisance.
B.2.c. Interfere with Landlord's management of the Buildings.
B.2.d. Permit any waste.
B.2.e. Use the Premises in any way that would increase insurance premiums or void
insurance on the Buildings.
B.2.f. Alter the Premises except in compliance with Subsection D.6.
B.2.g. Allow a lien to be placed on the Premises and /or Personal Property.
B.2.h. Assign this lease or sublease any portion of the Premises, including the Personal
Property, without Landlord's written consent.
C. Landlord's Obligations and Representations
C.I. Landlord agrees to-
CA.a. Lease to Tenant the Premises and Personal Property for the entire Term beginning
on the Commencement Date and ending on the Termination Date.
C.1.b. Obey all laws relating to Landlord's operation of the Buildings and Common Areas.
Page 5 of 21- Building Lease Agreement (City of Denton and 4SR Mulberry, LLC)
C.1.c. Repair, replace, and maintain the structural elements (including, but not limited
to, roof, foundation, exterior walls, doors and corridors of the Buildings), sewer components not
located within the Buildings, and the roof of the Buildings. Landlord will promptly make repairs
(taking into account the nature and urgency of the repair) for which Landlord is responsible.
C.1.d. Perform, or cause to be performed, any repair and maintenance on the HVAC and
elevator systems that exceed tenant's financial limitations on the same as set forth in
subsections B.1.h.iii. and B.1.h.iv.
C.1.e. Replace the HVAC and elevators serving the Buildings.
C.11. Provide Tenant promptly after receipt of a written request from Tenant with a
reconciliation of Tenant's Pro Rata Share of the actual Operating Expenses incurred by Landlord
during the preceding calendar year and the estimated Operating Expenses paid by Tenant for
the same period and reimburse Tenant for the amount of any estimated Operating Expenses
paid by Tenant in excess of Tenant's Pro Rata Share of actual Operating Expenses for the
preceding calendar year.
C.1.g. INDEMNIFY, DEFEND, AND HOLD TENANT, INCLUDING, BUT NOT LIMITED TO,
CITY COUNCIL MEMBERS, MEMBERS OF ITS VARIOUS BOARDS AND COMMISSIONS,
EMPLOYEES AND AGENTS, HARMLESS FROM ANY INJURY AND ANY RESULTING OR RELATED
CLAIMS (INCLUDING SUMS PAID IN SETTLEMENTS OF CLAIMS), ACTION, LOSS, LIABILITY,
JUDGMENTS, DAMAGES, PENALTIES, FINES, OR REASONABLE EXPENSE, INCLUDING, WITHOUT
LIMITATION, REASONABLE ATTORNEY'S FEES, CONSULTANT FEES, EXPERT FEES AND OTHER
FEES AND COURT AND OTHER COSTS, IMPOSED ON, INCURRED BY, OR ASSERTED AGAINST
LANDLORD OCCURRING IN ANY PORTION OF THE COMMON AREAS OR THE DATCU PARKING
LOT AND WHICH ARISE DURING OR AFTER THE TERM OF THIS LEASE FROM OR IN
CONNECTION WITH THE PRESENCE OR SUSPECTED PRESENCE OF HAZARDOUS MATERIALS (AS
DEFINED HEREIN) IN THE SOIL OR GROUNDWATER ON OR UNDER THE PREMISES. THE
INDEMNITY CONTAINED IN THIS PARAGRAPH (1) IS INDEPENDENT OF LANDLORD'S
INSURANCE, (ii) WILL NOT BE LIMITED BY COMPARATIVE NEGLIGENCE STATUTES OR
DAMAGES PAID UNDER THE WORKERS' COMPENSATION ACT OR SIMILAR EMPLOYEE BENEFIT
ACTS, (iii) WILL SURVIVE THE END OF THE TERM, AND (iv) WILL APPLY EVEN IF AN INJURY IS
CAUSED IN WHOLE OR IN PART BY THE ORDINARY NEGLIGENCE OR STRICT LIABILITY OF
TENANT BUT WILL NOT APPLY TO THE EXTENT AN INJURY IS CAUSED BY THE GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT OF TENANT. WITHOUT LIMITING THE GENERALITY OF
THE FOREGOING, THE INDEMNIFICATION PROVIDED BY THIS SECTION WILL SPECIFICALLY
COVER COSTS INCURRED IN CONNECTION WITH ANY INVESTIGATION OF SITE CONDITIONS OR
ANY CLEAN -UP, REMEDIAL WORK, REMOVAL OR RESTORATION WORK REQUIRED BY ANY
FEDERAL, STATE OR LOCAL GOVERNMENTAL AUTHORITY.
C.1.h. Abide by any obligations contained in Section D.
C.11 Provide Tenant a copy of the Notice of Appraised Value received from the Denton
Central Appraisal District within (10) days of receiving it.
C.2. Landlord agrees not to—
Page 6 of 21- Building Lease Agreement (City of Denton and 4SR Mulberry, LLQ
C.2.a. Interfere with Tenant's possession of the Premises and Personal Property as long
as Tenant is not in default.
C.2.b. Unreasonably withhold consent to a proposed assignment, transfer, sublease,
alteration or signage request.
D. General Provisions
Landlord and Tenant agree to the following:
D.I. Lease Grant. Landlord leases the Premises and Personal Property to Tenant and Tenant
leases the Premises and Personal Property from Landlord, together with the Common Areas.
D.2. Tenant's Right to Possession. As long as Tenant pays the Rent and fully performs all of its
other covenants and agreements under this Lease, Tenant will have the right to occupy the Premises,
and use the Personal Property, without hindrance from Landlord or any person lawfully claiming
through Landlord, subject to the terms of this Lease, all Mortgages, insurance requirements, and
applicable law.
D.3. Term; Adjustment of Commencement Date; Possession; Latent Defects.
D.3.a. Term. This Lease governs the relationship between Landlord and Tenant with
respect to the Premises from the Effective Date through the Termination Date, unless
terminated early in accordance with this Lease. The Term of this Lease commences on the
Commencement Date or any date before the Commencement Date in which the Tenant takes
possession of any part of the Premises for purposes of conducting business.
D.3.b. Acceptance of Premises and Personal Property. The Premises and Personal
Property are accepted by Tenant in "AS IS" condition and configuration subject to (1) any
Landlord obligation to perform Landlord Work expressly set forth herein, (2) Landlord's repair
obligations under Subsection C.3.a, and (3) any latent defects (which Tenant notifies Landlord of
within ninety (90) days after the Commencement Date) in the Premises or the Landlord Work.
By taking possession of the Premises, Tenant agrees that the Premises are in good order and
satisfactory condition and agrees that there are no representations or warranties, express or
implied, by Landlord about the condition of the Premises or the Buildings.
D.3.c. Possession of Premises and Personal Property Before Commencement Date.
Tenant will not take possession of the Premises and Personal Property before the
Commencement Date except with Landlord's written consent. If Tenant takes possession of the
Premises and Personal Property or commences business activities at the Premises, and uses the
Personal Property, before the Commencement Date with Landlord's permission, the possession
and occupancy will be subject to the terms and conditions of this Lease and Tenant will pay Rent
(defined in Subsection A.B.) to Landlord for each day of possession before the Commencement
Date. However, except for the cost of services requested by Tenant, Tenant will not be required
to pay Base Rent and Tenant's Pro Rata Share of Operating Expenses for any days of possession
before the Commencement Date during which Tenant, with Landlord's written consent, is in
possession of the Premises and Personal Property for the sole purpose of performing
improvements or installing furniture, equipment, or other personal property. If this Lease is
Page 7 of 21- Building Lease Agreement (City of Denton and 4SR Mulberry, LLQ
executed before any portion of the Premises becomes vacant or otherwise available and ready
for occupancy, or if any present tenant or occupant of any portion of the Premises holds over
and Landlord is unsuccessful in acquiring possession of such portion of the Premises on or
before the Commencement Date, Landlord shall not be deemed to be in default hereunder nor
in any way liable to Tenant and Tenant agrees to accept possession of such portion of the
Premises at such time that Landlord is able to tender the same; provided, however, that
Landlord is able to deliver full possession to Tenant within thirty (30) days of the
Commencement Date.
D.3.d. Latent Defects. Tenant will have a period of ninety (40) days after the Commencement
Date to inspect the Premises and notify Landlord in writing of any defects and maintenance, repairs or
replacements required to (a) the fixtures and equipment serving the Premises are in good operating
condition, including the plumbing, electrical and lighting systems, any fire protection sprinkler system,
the HVAC systems and equipment, the roof, skylights, doors, windows, and elevators; and (b) the
interior of the Premises is in good condition above named fixtures, equipment and interior. Within a
reasonable period of time after the timely receipt of any such written notice from Tenant, landlord
shall, at Landlord's expense, correct the defects and perform the maintenance, repairs and
replacements. D.4. Cleaning. Tenant must keep the Premises and Personal Property clean and sanitary
and promptly dispose of all trash in appropriate receptacles. Tenant will provide, at Tenant's expense,
janitorial services to the Premises.
D.S. Alterations.
D.S.a. When Consent Is Required. Tenant will not make any alterations, additions, or
improvements to the Premises or install any fiber or cable on the Premises or in other parts of
the Buildings (collectively, "Alterations ") without first obtaining Landlord's written consent.
However, Landlord's consent will not be required for any Alteration that satisfies all of the
following criteria ( "Minor Alteration "): (i) it is of a cosmetic nature such as painting,
wallpapering, hanging pictures, or installing carpeting, (ii) it is not visible from outside the
Buildings, (iii) it will not affect the systems or structure of the Buildings, and (iv) it does not
require work to be performed inside the walls or above the ceiling of the Buildings.
D.S.b. Requirements for All Alterations, Including Minor Alterations. Before starting
work on any Alteration, Tenant will give the following to Landlord for review and approval: plans
and specifications; names of proposed contractors (provided that Landlord may designate
specific contractors for Buildings systems); copies of contracts; necessary permits and approvals;
evidence of contractors' and subcontractors' insurance; and Tenant's security for performance
of the Alteration. Changes to the plans and specifications must also be submitted to Landlord for
its approval. Some of these requirements may be waived by Landlord for the performance of
specific Minor Alterations, but the waiver must be obtained in writing before the
commencement of the Minor Alterations. Landlord's waiver on one occasion does not waive its
right to enforce the requirements on any other occasion. Alterations must be made in a good
and workmanlike manner using materials of a quality that is at least equal to what is designated
by Landlord as the minimum standard for the Buildings. On completion of the Alterations,
Tenant will furnish "as- built" plans (which are required for Minor Alterations), completion
affidavits, full and final waivers of liens, receipts, and bills covering all labor and materials.
Tenant will ensure that the Alterations comply with all insurance requirements and Laws.
Page 8 of 21- Building Lease Agreement (City of Denton and 4SR Mulberry, LLC)
D.S.c. Personal Property Alteration. Tenant shall not make any alterations to the
Personal Property.
D.6. Entry by Landlord. Landlord and its agents, contractors, and representatives may enter the
Premises to inspect or show the Premises and /or Personal Property, to clean and make repairs,
alterations, or additions to the Premises, and to conduct or facilitate repairs, alterations, or additions to
any part of the Buildings, including other tenants' premises. Except in emergencies or to provide
building services after Normal Business Hours, Landlord will give Tenant reasonable notice of entry into
the Premises, which may be given orally. Landlord may temporarily close all or part of the Premises to
perform repairs, alterations, and additions, if reasonably necessary for the protection and safety of
Tenant and its employees. However, except in emergencies, Landlord will not close the Premises if the
work can reasonably be completed on weekends and after Normal Business Hours. However, Landlord is
not required to conduct work on weekends or after Normal Business Hours if the work can be
conducted without closing the Premises.
D.7. Abatement. Tenant's covenant to pay Rent and Landlord's covenants are independent.
Except as otherwise provided, Tenant will not be entitled to abate Rent for any reason.
D.B. Insurance.
D.B.a. Tenant's Insurance. Tenant will maintain the following insurance ( "Tenant's
Insurance ") at its sole cost and expense: (1) commercial general liability insurance applicable to
the Premises, its appurtenances and the DATCU Parking Lot providing, on an occurrence basis, a
minimum combined single limit of Five Million Dollars ($5,000,000.00) (coverage in excess of
One Million Dollars ($1,000,000.00)1 may be provided through an umbrella /excess liability
policy), (2) causes of loss — special form (formerly "all risk ") property insurance, including flood
and earthquake, covering all above - building- standard leasehold improvements including sprinkler
leakage coverage, covering the full replacement value of all of Tenant's goods and merchandise, trade
fixtures, furniture, signs, decorations, furnishings, wall covering, floor covering, draperies, equipment,
and all other items of personal property within the Premises ( "Tenant's Property") in the amount of
the full replacement cost (replacement cost means the cost to replace without deduction for
depreciation), (3) business automobile liability insurance to cover all owned, hired, and non -
owned automobiles owned or operated by Tenant providing a minimum combined single limit
of One Million Dollars ($1,000,000.00) }, (5) workers' compensation insurance as required by the
state in which the Premises are located and in amounts as may be required by applicable statute
(but if no workers' compensation insurance is statutorily required, Tenant will carry workers'
compensation insurance in a minimum amount of Five Hundred Thousand Dollars
($500,000.00)), and (6) employer's liability insurance in an amount of at least Five Hundred
Thousand Dollars ($500,000.00) per occurrence. All commercial general liability and business
automobile liability insurance policies will name Landlord (or any successor), Landlord's
Mortgagee (if any), and their respective members, principals, beneficiaries, partners, officers,
directors, employees, and agents, and other designees of Landlord as "additional insureds" and
will be primary with Landlord's policy being secondary and noncontributory. Tenant will provide
Landlord with a certificate of insurance and all required endorsements evidencing Tenant's
Insurance before the earlier of the Commencement Date or the date Tenant is provided with
possession of the Premises for any reason, and on renewals at least ten (10) days before the
insurance coverage expires. All of Tenant's Insurance policies, endorsements, and certificates
Page 9 of 21- Building Lease Agreement (City of Denton and 4SR Mulberry, LLC)
will be on forms and with any deductibles and self - insured retention reasonably acceptable to
Landlord. The limits of Tenant's insurance will not limit Tenant's liability under this Lease. For
purposes of this section, insurance requirements may be met through self- insurance, provided;
however, that any self- insurance meets all the requirements for the insurance coverage as
required herein. However, for the Landlord to accept self- insurance, Tenant must demonstrate
by written information that it has adequate financial resources to be a self- insured entity as
reasonably determined by Landlord, based on financial information furnished by Tenant.
Nothing contained in this section shall in anyway impact the immunities and damage caps
available to Tenant under the Texas Tort Claims Act and in no situation shall Tenant's liability to
Landlord be greater than the City's liability under the Texas Tort Claims Act.
D.8.b. Landlord's Insurance. Landlord will maintain the following insurance:
(1) commercial general liability insurance applicable to the Premises that provides, on an
occurrence basis, a minimum combined single limit of Five Million Dollars ($5,000,000.00)
(coverage in excess of One Million Dollars ($1,000,000.00) may be provided through an
umbrella /excess liability policy), and (2) causes of loss — special form (formerly "all risk ")
property insurance on the Buildings in the amount of the replacement cost, as reasonably
estimated by Landlord. The foregoing insurance and any other insurance carried by Landlord
may be affected by a policy or policies of blanket insurance and will be for the sole benefit of
Landlord and under Landlord's sole control. Tenant will have no right or claim to any proceeds
of this insurance or any other rights under it. Replacement cost means the cost to replace
without deduction for depreciation.
D.9. Release of Claims /Subrogation.
D.9.a. LANDLORD AND TENANT RELEASE EACH OTHER AND LIENHOLDER, AND THEIR
RESPECTIVE AGENTS, FROM ALL CLAIMS OR LIABILITIES FOR DAMAGE TO THE PREMISES OR
BUILDINGS, DAMAGE TO OR LOSS OF PERSONAL PROPERTY WITHIN THE BUILDINGS, AND
LOSS OF BUSINESS OR REVENUES THAT ARE COVERED BY THE RELEASING PARTY'S PROPERTY
INSURANCE OR THAT WOULD HAVE BEEN COVERED BY THE REQUIRED INSURANCE IF THE
PARTY FAILS TO MAINTAIN THE PROPERTY COVERAGES REQUIRED BY THIS LEASE. THE PARTY
INCURRING THE DAMAGE OR LOSS WILL BE RESPONSIBLE FOR ANY DEDUCTIBLE OR SELF -
INSURED RETENTION UNDER ITS PROPERTY INSURANCE. LANDLORD AND TENANT WILL
NOTIFY THE ISSUING PROPERTY INSURANCE COMPANIES OF THE RELEASE SET FORTH IN THIS
PARAGRAPH AND WILL HAVE THE PROPERTY INSURANCE POLICIES ENDORSED, IF NECESSARY,
TO PREVENT INVALIDATION OF COVERAGE. THIS RELEASE WILL NOT APPLY IF IT INVALIDATES
THE PROPERTY INSURANCE COVERAGE OF THE RELEASING PARTY. THE RELEASE IN THIS
PARAGRAPH WILL APPLY EVEN IF THE DAMAGE OR LOSS IS CAUSED IN WHOLE OR IN PART BY
THE ORDINARY NEGLIGENCE OR STRICT LIABILITY OF THE RELEASED PARTY OR ITS AGENTS
BUT WILL NOT APPLY TO THE EXTENT THE DAMAGE OR LOSS IS CAUSED BY THE GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT OF THE RELEASED PARTY OR ITS AGENTS.
D.9.b. Mutual Waiver. Notwithstanding any other provision of this Lease to the contrary,
each party to this Lease waives any rights of recovery against the other for injury or loss on
account of hazards covered by insurance required to be carried under this Lease (whether or not
self- insured) to the extent of the amount of insurance proceeds that party would have received
Page 10 of 21- Building Lease Agreement (City of Denton and 4SR Mulberry, LLC)
under that insurance if that party had maintained all insurance it is required to maintain under
this Lease; provided, however, that this release shall not be applicable to the portion of any
damage which is not reimbursable by the damaged party's insurer because of the "deductible"
permitted hereunder in the damaged party's insurance coverage. For purposes of the Paragraph
D.9.b., Tenant shall be deemed to be required to carry the insurance required of Tenant under
Paragraph D.8.a., even though such paragraph provides that Tenant has the option to self -
insure.
D.9.c. Subrogation. All policies of property insurance required to be carried by either
party for the Buildings, the Premises, or personal property or fixtures in the Buildings or in the
Premises shall include a clause or endorsement denying to the insurer rights by way of
subrogation against the other party to the extent rights have been waived by the insured before
the occurrence of injury or loss.
D.10. Casualty /Total or Partial Destruction
D.10.a. If the Buildings are damaged by casualty, and the damage would prevent or
materially interfere with Tenant's Permitted Use of the Premises, and the Buildings can be
restored within 90 days, Landlord will, at its expense, restore the roof, foundation, Common
Areas, and structural soundness of the exterior walls of the Buildings to substantially the same
condition that existed before the casualty and Tenant will, at its expense, be responsible for
replacing any of its damaged furniture, fixtures, additions or other improvements that Tenant is
required to insure, and personal property belonging to Tenant. If Landlord fails to complete the
portion of the restoration for which Landlord is responsible within one hundred and twenty
(120) days from the date of written notification by Tenant to Landlord of the casualty, Tenant
may terminate this lease by written notice delivered to Landlord before Landlord completes
Landlord's restoration obligations.
D.10.b. If the Buildings cannot be restored within ninety (90) days, Landlord has an
option to restore the Buildings. If Landlord chooses not to restore, the Lease will terminate. If
Landlord chooses to restore, Landlord will notify Tenant of the estimated time to restore and
give Tenant an option to terminate this Lease by notifying Landlord in writing within ten (10)
days of Tenant's receipt of Landlord's notice. If Tenant does not terminate this Lease, the Lease
will continue and Landlord will restore the Buildings as provided in D.13.a. above.
D.10.c. To the extent the Buildings are untenantable after the casualty, the Rent will be
adjusted as may be fair and reasonable.
D.11. Condemnation /Substantial or Partial Taking
D.11.a. If the Buildings cannot be used for the purposes contemplated by the Lease
because of condemnation or purchase in lieu of condemnation, the Lease will terminate.
D.11.b. If there is a condemnation or purchase in lieu of condemnation and the Lease is
not terminated, Landlord will, at Landlord's expense, restore the Buildings, and the Rent payable
during the unexpired portion of the Term will be adjusted as may be fair and reasonable.
Page 11 of 21- Building Lease Agreement (City of Denton and 45R Mulberry, LLC)
D.11.c. Tenant will have no claim to the condemnation award or proceeds in lieu of
condemnation.
D. 12. Interest and Late Charges. Tenant agrees that all sums to be paid under this Lease, if not
paid when due, shall bear interest on the unpaid portion thereof at the per annum rate equal to the
lesser of eighteen percent (18 %) or the maximum rate permitted by law from the date when due but not
in excess of the highest legal rates. Tenant further agrees that for each calendar month, that the Rent is
not paid to Landlord within ten (10) days of the due date as provided herein above, Tenant shall
promptly pay to Landlord a late fee equal to ten (10 %) percent of the monthly Rent. If Landlord shall pay
any monies, or incur any expenses in correction of any violation of any covenant of Tenant herein set
forth, the amounts so paid or incurred shall, at Landlord's option and on notice to Tenant, be considered
additional Rent payable by Tenant with the first installment of Minimum Rent thereafter to become due
and payable, and may be collected or enforced as by law provided with respect to Rent. Tenant shall pay
to Landlord Fifty and No /100 Dollars ($50.00) for each of Tenant's checks returned to Landlord unpaid
by Tenant's bank.
D.13. Default by Landlord /Events. Defaults by Landlord are failing to comply with any provision
of the Lease within 30 days after written notice by Tenant, or if such failure is of a nature to require
more than thirty (30) days for remedy and continues beyond the time reasonably necessary to cure.
D.14. Default by Landlord /Tenant's Remedies. Tenant's remedies for Landlord's default are to
sue for damages, and, if Landlord does not comply with the requirements of C.1.c. and C.1.d. within
thirty (30) days after Landlord receives written notice of default from Tenant, terminate this lease. In no
event shall Tenant withhold, deduct or offset any expense or claim from the payment of Rent.
D.15. Default by Tenant /Events. Defaults by Tenant are (a) failing to pay timely Rent, (b)
abandoning or vacating a substantial portion of the Premises, and (c) failing to comply within ten days
after written notice with any provision of this lease other than the defaults set forth in (a) and (b).
D.16. Default by Tenant /Landlord's Remedies. Landlord's remedies for Tenant's default are to
(a) enter and take possession of the Premises and Personal Property, after which Landlord may relet the
Premises and Personal Property on behalf of Tenant and receive the rent directly by reason of the
reletting, and Tenant agrees to reimburse Landlord for any expenditures made in order to relet, (b)
enter the Premises and perform Tenant's obligations and charge Tenant for the costs of such cure, (c)
apply all or part of the Security Deposit to the default of Tenant, and (d) terminate this lease by written
notice and sue for damages. Landlord may enter and take possession of the Premises and Personal
Property, without terminating this Lease, by self -help, by picking or changing locks if necessary, and may
lock out Tenant or any other person who may be occupying the Premises and using the Personal
Property, until the default is cured, without being liable for damages. Notwithstanding anything to the
contrary in this Lease, if more than 2 monetary defaults by Tenant of any kind occurs during any 12
consecutive month period, the same shall constitute a default under this Lease, and Landlord shall have
the right, in addition to all of the remedies set forth above, to any of the following remedies, upon
written notice to Tenant: (1) Increase all Base Rent due for the remainder of the Term by an amount
equal to 10% of the rate otherwise payable; or (2) Require Tenant to make all remaining payments due
under the Lease by certified funds.
D.17. Surrender of Premises and Personal Property. All improvements to the Premises
(collectively, "Leasehold Improvements ") will be owned by Landlord and will remain on the Premises
Page 12 of 21- Building Lease Agreement (City of Denton and 4SR Mulberry, LLC)
without compensation to Tenant. At the expiration or termination of this Lease or Tenant's right of
possession, Tenant will remove Tenant's Removable Property (defined below) from the Premises and
surrender the Premises to Landlord, broom clean and in good order, condition, and repair, except for
ordinary wear and tear. The term "Tenant's Removable Property" means (a) fiber, cable and related
appurtenances installed by or for the benefit of Tenant and located on the Premises or in other parts of
the Buildings, (b) any Leasehold Improvements that are performed by or for the benefit of Tenant and,
in Landlord's reasonable judgment, are of a nature that would require removal and repair costs that
materially exceed the removal and repair costs associated with standard office improvements ( "Special
Installations "), and (c) Tenant's personal property. Despite the foregoing, Landlord may, in its sole
discretion and at no cost to it, require Tenant to leave any of its Special Installations on the Premises. If
Tenant fails to remove any of Tenant's Removable Property (other than Special Installations that
Landlord has designated to remain on the Premises) within two (2) days after the termination of this
Lease or of Tenant's right to possession, Landlord, at Tenant's sole cost and expense, will be entitled
(but not obligated) to remove and store Tenant's Removable Property. Landlord will not be responsible
for the value, preservation, or safekeeping of Tenant's Removable Property. Tenant will pay Landlord,
on demand, the expenses and storage charges incurred for Tenant's Removable Property. To the fullest
extent permitted by Law, any unused part of Tenant's Security Deposit may be applied to offset
Landlord's costs specified in the preceding sentence. In addition, if Tenant fails to remove Tenant's
Removable Property from the Premises or storage within thirty (30) days after written notice, Landlord
may deem all or any part of Tenant's Removable Property to be abandoned, and title to Tenant's
Removable Property (except for any Hazardous Materials [defined in Subsection D.20.) will be deemed
to be immediately vested in Landlord. Except for Special Installations designated by Landlord to remain
on the Premises, Tenant's Removable Property will be removed by Tenant before the Expiration Date.
However, with Landlord's written consent (which must be requested by Tenant at least thirty (30) days
in advance of the Expiration Date and which may not be unreasonably withheld), Tenant may remain on
the Premises for up to five (5) days after the Expiration Date for the sole purpose of removing Tenant's
Removable Property. Tenant's possession of the Premises for this purpose will be subject to all of the
terms and conditions of this Lease, including the obligation to pay Base Rent and Tenant's Pro Rata
Share of Excess Operating Expenses on a per diem basis at the rate in effect for the last month of the
Term. If this Lease is terminated before the Expiration Date, Tenant's Removable Property (except for
Special Installations designated by Landlord to remain on the Premises) will be removed by Tenant on or
before the date of termination. Tenant will repair any damage caused by the installation or removal of
Tenant's Removable Property.
D.18. Hazardous Materials. No Hazardous Materials (defined below) (except for de minimis
quantities of household cleaning products and office supplies used in the ordinary course of Tenant's
business at the Premises and used, kept, and disposed of in compliance with Laws) will be brought on,
used on, kept on, or disposed of on or about the Premises by any Tenant Parties or any of Tenant's
transferees, contractors, or licensees without Landlord's written consent, which may be withheld in
Landlord's sole discretion. Tenant's request for consent will include a representation and warranty by
Tenant that the Hazardous Materials in question are necessary in the ordinary course of Tenant's
business and will be used, kept, and disposed of in compliance with all Laws. If Contamination (defined
below) occurs as a result of an act or omission of any Tenant Party, Tenant will, at its expense, promptly
take all actions necessary to comply with Laws and to return the Premises, the Buildings, and any
adjoining or affected property to its condition before the Contamination, subject to Landlord's written
approval of Tenant's proposed methods, times, and procedures for remediation. Tenant will provide
Page 13 of 21- Building Lease Agreement (City of Denton and 45R Mulberry, LLC)
Landlord reasonably satisfactory evidence that such actions will not adversely affect Landlord or
contaminated property. Landlord may require that a representative of Landlord be present during any
such actions or that such actions be taken after business hours. If Tenant fails to take and diligently
prosecute any necessary remediation actions within thirty (30) days after written notice from Landlord
or an authorized governmental agency (or any shorter period required by any governmental agency)
that remediation is required, Landlord may take such actions and Tenant will reimburse Landlord for
them, within thirty (30) days of Landlord's invoice. The term "Hazardous Materials" includes any
substance (a) that requires notification, investigation, or remediation under any Laws, or (b) that is
defined, listed, or regulated by any governmental authority as a "hazardous waste," "extremely
hazardous waste," "solid waste," "toxic substance," "hazardous substance," "hazardous material," or
"regulated substance," or otherwise regulated under any Laws. "Contamination" means any release or
disposal of Hazardous Materials in, on, under, at, or from the Premises or the Buildings that may result
in any liability, fine, use restriction, cost recovery lien, remediation requirement, or other government or
private action or imposition affecting Landlord. Under this Lease, claims arising from Contamination
include but are not limited to diminution in value, restrictions on use, adverse impact on leasing space,
and all costs of site investigation, remediation, removal, and restoration work, including response costs
under CERCLA and similar statutes.
D.19. Extension Option.
D.19.a. Option to Extend the Term. Landlord grants to Tenant an option to extend the
Term for an additional term of thirty -six (36) months (the "Extension "), on the same terms,
conditions and covenants set forth in this Lease, except for Rent. The Option may be exercised
only by written notice delivered to Landlord no earlier than One Hundred Eighty (180) days
before, and no later than One Hundred Twenty (120) days before, the expiration of the Term. If
Tenant fails to deliver to Landlord a written notice of the exercise of the Option within the
prescribed time period, the Option will lapse, and there will be no further right to extend the
Term. The Option may only be exercised by Tenant on the express condition that, at the time of
the exercise, Tenant is not in default under any of the provisions of this Lease. The option is
personal to Tenant and may not be exercised by an assignee or subtenant without Landlord's
written consent.
D. 19.b. Rent During the Extension. The Base Rent during the Extension will be the Fair
Market Rental determined as follows:
D. 19.b.i. The "Fair Market Rental" of the Premises means the price that a ready
and willing tenant would pay as of the commencement of the Extension as monthly rent
to a ready and willing landlord of Premises comparable to the Premises if the property
were exposed for lease on the open market for a reasonable period of time, and taking
into account the term of the Extension, the amount of improvements made by Tenant
at its expense, the creditworthiness of the Tenant, and all of the purposes for which the
property may be used and not just the use proposed to be made of the Premises by
Tenant. Upon proper written notice by Tenant to Landlord of Tenant's intention to elect
to exercise the renewal Option, Landlord shall, within One Hundred Eighty (180) days
thereafter, notify Tenant in writing of Landlord's proposed Fair Market Rental amount,
and Tenant shall thereupon notify Landlord of Tenant's acceptance or rejection of
Landlord's proposed amount. Failure of Tenant to reject Landlord's Fair Market Rental
Page 24 of 22 - Building Lease Agreement (City of Denton and 4SR Mulberry, LLC)
amount within seventy five (75) days after receipt of Landlord's notice will be deemed
Tenant's acceptance of Landlord's proposed Fair Market Rental amount.
D. 19.b.ii. If Landlord and Tenant have not been able to agree on the Fair Market
Rental amount within forty (40) days following the exercise of the Option, the Fair
Market Rental for the Extension will be determined by the following appraisal process.
Landlord and Tenant shall endeavor in good faith to select a single Appraiser. The term
"Appraiser" means a State Certified Real Estate Appraiser licensed by the State of Texas
to value commercial property. If Landlord and Tenant are able to agree upon and select
a single Appraiser, that Appraiser will determine the Fair Market Rental for the
Extension. If Landlord and Tenant are unable to agree upon a single Appraiser within
days after the end of the 40 -day period, each will then appoint one Appraiser by written
notice to the other, given within days after the end of the 40 -day period. Within five
business days after the two Appraisers are appointed, the two Appraisers will appoint a
third Appraiser. If either Landlord or Tenant fails to appoint its Appraiser within the
prescribed time period, the single Appraiser appointed will determine the Fair Market
Rental amount of the Premises. Each party will bear the cost of the appraiser appointed
by it and the parties will share equally the cost of the third appraiser. The Fair Market
Rental of the Premises will be the average of two of the three appraisals that are closest
in amount, and the third appraisal will be disregarded.
D.20. Default /Waiver /Mitigation. It is not a waiver of default if the non - defaulting party fails to
declare immediately a default or delays in taking any action. Pursuit of any remedies set forth in this
lease does not preclude pursuit of other remedies in this lease or provided by applicable law. Landlord
and Tenant have a duty to mitigate damages.
D.21. Holdover, If Tenant does not vacate the Premises following termination of this Lease, it
shall be considered a tenancy from month to month with a rent equal to one hundred percent (150 %) of
the Base Rent, cancelable by either Landlord or Tenant upon thirty (30) days' written notice. No holding
over by Tenant, whether with or without the consent of Landlord, will extend the Term. Tenant shall
also indemnify, defend and hold Landlord harmless from and against all claims and damages,
consequential as well as direct, sustained by reason of Tenant's holding over.
D.22. Alternative Dispute Resolution. Landlord and Tenant agree to mediate in good faith before
filing a suit for damages.
D.23. Attorney's Fees. If either party retains an attorney to enforce this lease, the party
prevailing in litigation is entitled to recover reasonable attorney's fees and other fees and court and
other costs.
D.24. Venue. Exclusive venue is in the county in which the Premises are located.
D.25. Entire Agreement. This lease, its exhibits, addenda, and riders are the entire agreement of
the parties concerning the lease of the Premises by Landlord to Tenant. There are no representations,
warranties, agreements, or promises pertaining to the Premises or the lease of the Premises by Landlord
to Tenant, and Tenant is not relying on any statements or representations of any agent of Landlord, that
are not in this lease and any exhibits, addenda, and riders.
Page 15 of 21- Building Lease Agreement (City of Denton and 4SR Mulberry, LLC)
D.26. Amendment of Lease. This lease may be amended only by an instrument in writing signed
by Landlord and Tenant.
D.27. Limitation of Warranties. THERE ARE NO IMPLIED WARRANTIES OF MERCHANTABILITY,
OF FITNESS FOR A PARTICULAR PURPOSE, OR OF ANY OTHER KIND ARISING OUT OF THIS LEASE, AND
THERE ARE NO WARRANTIES THAT EXTEND BEYOND THOSE EXPRESSLY STATED IN THIS LEASE.
D.28. Notices. Any notice required or permitted under this lease must be in writing. Any notice
required by this lease will be deemed to be delivered (whether actually received or not) when deposited
with the United States Postal Service, postage prepaid, certified mail, return receipt requested, and
addressed to the intended recipient at the address shown in this lease. Notice may also be given by
regular mail, personal delivery, courier delivery, facsimile transmission, or other commercially
reasonable means and will be effective when actually received. Any address for notice may be changed
by written notice delivered as provided herein.
D.29. Abandoned Property. Landlord may retain, destroy, or dispose of any property left on the
Premises at the end of the Term.
D.30. Authority. Landlord covenants, warrants, and represents that (1) each individual
executing, attesting, and delivering this Lease on behalf of Landlord is authorized to do so on behalf of
Landlord, (2) this Lease is binding on and enforceable against Landlord, and (3) Landlord is duly
organized and legally existing in the state of its organization and is qualified to do business in the state in
which the Premises are located. Similarly, Tenant covenants, warrants, and represents that (1) each
individual executing, attesting, and delivering this Lease on behalf of Tenant is authorized to do so on
behalf of Tenant, (2) this Lease is binding on and enforceable against Tenant, and (3) Tenant is duly
organized and legally existing in the state of its organization and is qualified to do business in the state in
which the Premises are located.
D.31. Time of Essence; Relationship; Binding Agreement. Time is of the essence for Tenant's
performance of its obligations and the exercise of any expansion, renewal, or extension rights or other
options granted to Tenant. This Lease will create only the relationship of landlord and tenant between
the parties, and not a partnership, joint venture, or any other relationship. This Lease and its covenants
and conditions will inure only to the benefit of and be binding only on Landlord and Tenant and their
permitted successors and assigns.
D.32. Entire Agreement; Amendment. This Lease contains the parties' entire agreement about
the subject matter of the transaction. All understandings, discussions, and agreements previously made
between the parties, written or oral, are superseded by this Lease, and neither party is relying on any
warranty, statement, or representation not contained in this Lease. This Lease may be modified only by
a written agreement signed by both Landlord and Tenant. The exhibits and riders attached to this Lease
are incorporated into and made a part of this Lease for all purposes.
D.33. Tax Protest. Landlord authorizes to Tenant all rights under all Laws to protest appraised
values a regarding the Premises (including Landlord's personal property), regardless of whether
Landlord contests the appraisal. Landlord shall promptly deliver notice of any appeals or other
information with respect to such appraised values upon Tenants reasonable request for such
information.
Page 16 of 21- Building Lease Agreement (City of Denton and 4SR Mulberry, LLC)
D.34. Prohibited Persons and Transactions. Tenant represents to Landlord that (1) neither
Tenant nor any person or entity that directly owns a ten percent (10 %) or greater equity interest in it,
nor any of its officers, directors, or managing members, is a person or entity with whom U.S. persons or
entities are restricted from doing business under regulations of the Office of Foreign Asset Control
( "OFAC ") of the Department of the Treasury (including those named in the OFAC's Specially Designated
and Blocked Persons List) or under Executive Order 13224 ( "Executive Order") effective on September
24, 2001, and titled "Blocking Property and Prohibiting Transactions with Persons Who Commit,
Threaten to Commit, or Support Terrorism," or other Laws (each such person, a "Prohibited Person "),
(2) Tenant's activities do not violate the International Money Laundering Abatement and Anti- Terrorist
Financing Act of 2001, or the regulations or orders promulgated under it, or other anti- money-
laundering Laws ( "Anti- Money- Laundering Laws "), and (3) throughout the Term of this Lease, Tenant
will comply with the Executive Order and with the Anti - Money- Laundering Laws.
D.35. Off -Site Parking. Tenant, including its invitees, will, at all times during the Term of the
lease, have exclusive use of the parking lot located on the Premises. Additionally, Tenant, including its
invites, will have non - exclusive use of the parking lot (the "DATCU Parking Lot") identified as the
Additional City Parking After Hours on Exhibit "B" hereto from 6:00 pm to 6:00 am Mondays through
Thursdays and from 6:00 pm on Fridays until 6:00 am on Mondays.
D.36. Early Termination.
D.36.a. Beginning thirty six (36) months after the Effective Date and concluding the day
before sixty (60) months after the Effective Date and provided Tenant is not in default under this
Lease beyond the applicable cure period, Tenant shall have the right to terminate the Lease, in
Tenant's sole discretion, at any time by providing the Landlord with twelve (12) months ninety
(90) days advance written notice.
D.36.b. Beginning sixty (60) months after the Effective Date and provided Tenant is not
in default under this Lease beyond the applicable cure period, Tenant shall have the right to
terminate the Lease, in Tenant's sole discretion, at any time by providing the Landlord with six
(6) months advance written notice.
D.37. Funding and Non - Appropriation. This Lease shall terminate in the event that the
governing body of Tenant shall fail to appropriate sufficient funds to satisfy any obligation of Tenant
hereunder. Termination shall be effective as of the last day of the fiscal period for which sufficient funds
were appropriated or upon expenditure of all appropriated funds, whichever comes first. Termination
pursuant to this non - appropriation clause shall be without further penalty or expense to either party.
D.38. Landlord's Personal Property Located in the Buildings at Time Tenant Takes Possession.
Landlord is not removing any of the Personal Property located in the Buildings prior to Tenant taking
possession of the Premises and is allowing Tenant use of the same during the Term of this Lease. Should
Tenant, from time to time, determine in its discretion that it does not need, or intend to use, any part of
Landlord's Personal Property, then, after written notice from Tenant, Landlord shall either remove said
Personal Property for its use or notify Tenant in writing that it wishes to donate it to charity of its
choosing. Tenant, as additional consideration for the execution of this Lease, shall deliver any donated
Personal Property to any location situated in Denton County, Texas.
Page 17 of 21- Building Lease Agreement (City of Denton and 4SR Mulberry, LLC)
LANDLORD:
4SR MULBERRY, LLC, a Texas limited liability company
By: ..._._ ... _..... .....
Billy D. Sie .ns, Jr., Ma Gaging Member
Signed on the day of — 2016.
By: LLTK Realty, LLC, Manag „ing,,Mernber°
Lawrence S, 10&7d yn,, Manager
Signed on the __ day of � r "'�� ._,...,,G 2016.
617 Primrose Court
Argyle, Texas 76226
Page 18 of 21- Building Lease Agreement (City of Denton and 4SR Mulberry, LLC)
TENANT:
City of Denton, a Texas home-rule municipal corporation
Geor� C. Campbell, City NVAa'ger . ..... ..
Signed on the 10— day of 2016.
Address:
215 E. McKinney St.
Denton, Texas 76201
Apppoved as to Legal Form:
\J"
Anita Burgess, City Attorney
Page 19 of 21- Building Lease Agreement (City of Denton and 45R Mulberry, LLC)
Exhibit "A"
Legal Description
BEING LOT 1, BLOCK A, OF HALL -LEWIS ADDITION, IN THE CITY OF DENTON, DENTON COUNTY, TEXAS,
ACCORDING TO THE PLAT THEREOF RECORDED IN CABINET R, PAGE 378, PLAT RECORDS OF DENTON
COUNTY, TEXAS.
Page 20 of 21- Building lease Agreement (City of Denton and 4SR Mulberry, LLQ
Page 21 of 21- Building Lease Agreement (City of Denton and 45R Mulberry, LLC)