LEASE

 

THIS LEASE ("Lease") is entered into as of the 21st day of December 2006, by and between JIM R. SMITH INTEREST ("Landlord") and TMIRS Enterprises, Ltd db/a TaxMasters ("Tenant").

 

WITNESSETH:

 

The Lease provisions set forth in this Section 1.01 in summary form are solely to facilitate convenient reference by the parties. If there is any conflict between this Section and any other provisions of this Lease, the latter shall control. For purposes of this lease the following terms shall have the meanings set forth opposite the term.

 

 

Landlord hereby does lease, let and demise unto Tenant, and Tenant hereby does lease and rent from Landlord, upon and subject to the provisions of this Lease, the Rentable Area of the Premises Building located in the Building located on the tract of land ("Land') situated in Harris County, Texas and more particularly described on EXHIBIT "A" attached hereto and incorporated herein for all purposes (the Building, the Land, the parking areas and garages, and any present or future associated underground or elevated pedestrian tunnels or walkways being hereinafter collectively referred to as the "Project"), TO HAVE AND TO HOLD said Premises for the Term, subject to the provisions of this Lease. Such space so leased to Tenant is herein called the "Premises" and is reflected on the floor plans ("Floor Plans") of the Building attached hereto as EXHIBIT "B". The term "Rentable Area" shall have the meaning set forth in EXHIBIT "C" attached hereto and incorporated herein for all purposes.

 

Before the Commencement Date and subject to delays caused by Tenant, Landlord shall substantially complete any leasehold improvements ("Leasehold Improvements") to be constructed or installed by Landlord pursuant to EXHIBIT "D" attached hereto and incorporated herein for all purposes. All installations now or hereafter placed on the Premises in excess of Building Standard items as determined by Landlord and as set forth in EXHIBIT "D" shall be for Tenant's account and at Tenant's cost (and Tenant shall pay ad valorem taxes and increased insurance thereon), which costs shall be payable by Tenant to Landlord as additional rent hereunder promptly upon being invoiced therefore, and failure by Tenant to pay same in full within thirty (30) days shall constitute an event of default by Tenant hereunder giving rise to all remedies available to Landlord under this Lease and at law for non-payment of rent.

 

 

Subject to the other provisions hereof, this Lease shall be and continue in full- force and effect for a primary term commencing on the Commencement Date, and expiring on the Expiration Date. Such term, as it may be modified, is herein called the "Term".

 

Subject to Section 3.04 hereof, if on the Commencement Date any of the work described in EXHIBIT "D" hereto that is required to be performed by Landlord at Landlord's expense has not been substantially completed, or if Landlord is unable to tender possession of the Premises to Tenant on the Commencement Date due to any other reason beyond the reasonable control of Landlord, then the Commencement Date shall be postponed until such work is substantially completed, the Expiration Date shall be extended so that the Term shall continue for the full number of years set forth in Section 3.01 and Landlord shall not be liable for any claims or damages in connection with such failure to complete construction or tender possession.

 

No delay in the completion of the Premises resulting from delay or failure on the part of Tenant in furnishing information, work or other matters required in EXHIBIT "ID" shall delay the Commencement Date, the Expiration Date or the commencement of installments of Rent.

 

If prior to the Commencement Date, Tenant shall enter into possession of all or any part of the Premises, such possession shall be subject to all of the provisions of this Lease, and the Term of the Lease and the payment of all Rent shall commence, with respect to all or such part of the Premises as are so occupied by Tenant, on the date of such entry, and the total amount of all Rent due hereunder shall not be increased accordingly, on a per diem basis, provided that no such early entry shall be permitted without Landlord's prior written consent or operate to change the Expiration Date provided for herein.

 

If the Commencement Date or Expiration Date is other than as set forth in Section 3.01 hereof, then upon request by either Landlord or Tenant, both parties shall execute and deliver a certificate setting forth the actual Commencement Date and Expiration Date,

 

Before the entry into possession of the Premises by Tenant, Tenant shall furnish to Landlord a letter accepting the condition of the Premises or specifying any area that is not acceptable. If Tenant enters and accepts possession, Tenant shall be deemed to have accepted the condition of the Premises without Landlord having any obligation to do further work.

 

ARTICLE 4

 

Tenant, in consideration for this Lease and the leasing of the Premises for the Term, agrees to pay to Landlord without deduction or set-off as rent, the Base Rent, in equal monthly installments for each calendar month during the Term. Base Rent is payable in advance and without demand, on the first day of each calendar month during the Term. If the Commencement Date is other than the first day of a month, Tenant shall be required to pay only a pro rata portion of the monthly installment of Base Rent for the first partial month of the Term for which Base Rent is payable hereunder on the Commencement Date.

 

 

 

 

 

In the event that Operating Expenses (defined in Section 5.02 hereof) of the Building during any calendar year of the Term shall exceed the Base Operating Expense for the Building, Tenant shall pay to Landlord its proportionate share of the increase in such Operating Expenses over the Base Operating Expense. Tenant's proportionate share of such increase is agreed to be Tenant's Pro Rata Share. On or before the Commencement Date Landlord shall provide to Tenant the Estimated Operating Expense Increase (hereinafter defined) for the calendar year during which the Commencement Date falls. Thereafter, from time to time, Landlord shall provide to Tenant the Estimated Operating Expense Increase (or an amendment thereto) for any year. In addition to the Base Rent, Tenant shall pay in advance on the first day of each calendar month during the Term, installments equal to 1/12th of Tenants Pro Rata Share of the Estimated Operating Expense Increase, except that the first such monthly installment is due upon the Commencement Date. As soon as possible after the comparison year, Landlord shall furnish to Tenant a statement certified by Landlord of the Actual Operating Expense Increase (hereinafter defined) for the immediately preceding calendar year, which statement shall specify the various types of Operating Expenses and set forth Landlord's calculations of Tenants Pro Rata Share of the Actual Operating Expense Increase. If Tenant's Pro Rata Share of the Estimated Operating Expense Increase paid to Landlord during the previous calendar year exceeds Tenant's Pro Rata Share of the Actual Operating Expense Increase, then Landlord shall, at its option, either refund the difference to Tenant at the time Landlord furnishes the statement of the Actual Operating Expense Increase or credit the amount overpaid by Tenant to Tenants Pro Rata Share of the Estimated Operating Expense Increase for the next calendar year. Otherwise, within fifteen (15) days after Landlord furnishes such statement to Tenant, Tenant shall make a lump sum payment to Landlord equal to Tenants Pro Rata Share of the positive difference between the Actual Operating Expense Increase and the Estimated Operating Expense Increase theretofore paid by Tenant.

 

The "Estimated Operating Expense Increase' shall equal Landlord's estimate of Operating Expenses for the applicable calendar year, less the Base Operating Expense. Landlord's statement of the Estimated Operating Expense Increase shall control for the year specified in such statement and for each succeeding year during the Term until Landlord provides a new statement of the Estimated Operating Expense Increase. The "Actual Operating Expense Increase" shall equal the actual Operating Expenses for the applicable calendar year, less the Base Operating Expense.

 

The term "Operating Expenses" shall mean and include those amounts, expenses, and costs of whatsoever nature that Landlord incurs because of or in connection with the ownership, operation, management, repair, or maintenance of the Project and Landlord's personal property used in connection therewith. Operating Expenses shall be determined on an accrual basis in accordance with generally accepted accounting principles consistently applied and shall include, without limitation, the following:

 

(a)  Wages, salaries, fees, related taxes, insurance, benefits, and reimbursable expenses of all personnel engaged in operating, repairing, and maintaining the Project and providing traffic control about the Project; provided, however, that if during the Term such personnel are also working on other projects being operated by Landlord, their wages, salaries, fees and related expenses shall be allocated by Landlord in good faith among all of such projects and only that portion of such expenses allocable to the Project shall be included as an "Operating Expense.'

 

(b)  Cost of all supplies and materials used in operating, repairing, and maintaining the Project.

 

(c)  Cost of all utilities for the Project, including, without limitation, water, electricity, gas, fuel oil, healing, lighting, air conditioning, and ventilating.

 

 

 

 

 

 

Tenant and its affiliates and subsidiaries shall use and occupy the Premises only for the purpose set forth in Article 1.01 (k), and for no other purposes. Tenant shall not use or permit the Premises to be used for any unlawful purpose or in any unlawful manner, and shall comply with all federal, state, and local governmental laws, ordinances, orders, rules and regulations applicable to the Premises, the Project, and the occupancy thereof and Tenant shall give prompt written notice to Landlord of any notification to Tenant of any claimed violation thereof. Tenant shall not do or permit anything to be done in or about the Premises, nor bring or keep anything therein which will in any way increase the existing rate of or affect any fire or other insurance upon the Project or any of its contents, or cause cancellation of any insurance policy covering the Project or any part thereof or any of its contents. Tenant shall not do or permit anything to be done in or about the Premises and/or Project which will in any way obstruct or interfere with the rights of other tenants or occupants of the Project or injure or annoy them. Tenant shall not permit any nuisance in, on or about the Premises. Tenant shall not commit or suffer to be committed any waste in or upon the Premises.

 

 

Provided Tenant is not in default hereunder, Landlord shall, at Landlord's expense except as provided to the contrary in this Lease, furnish to Tenant the following services:

 

(a)      Air conditioning and central heat at such temperatures and in such amounts as are reasonably considered by Landlord to be standard for the Building, during normal business hours for the Building as set forth in the Rules and Regulations as hereinafter defined. Tenant shall have thermostats within the Leased Premises.

 

(b)      Janitorial services in the Premises and public and exterior portions of the Building for all days, except Saturdays, Sundays and holidays; provided, however, if Tenant's floor covering or other improvements is other than Building Standard, as hereinafter defined, Tenant shall pay the additional cleaning cost attributable thereto as additional rent upon presentation of a statement therefore by Landlord. Janitorial shall include cleaning of kitchen area, but not dishes, and keeping paper towels in towel holders nightly in employee break areas.

 

(c)      Hot and cold water at those points of supply provided for general use of other tenants in the Building.

 

(d)      Normal and customary routine maintenance for all public, structural, and exterior portions of the Project according to Landlord's standards.

 

(e)      Electric lighting service for all public portions of the Project

 

(f)      Automatic passenger elevator service at all times for access to and egress from the Premises. Freight elevator service, in common with other tenants, shall be provided during reasonable business hours as prescribed by Landlord, exclusive of Saturdays, Sundays, and holidays.

 

(g)      All Building Standard fluorescent bulb replacement in all areas and all incandescent bulb replacement in public areas, toilet and rest room areas and stairwells,

 

(h)      Electrical facilities to furnish sufficient power for typewriters, calculating machines and other machines of similar low electrical consumption (total electrical power requirement not to exceed one watt per square foot of Rentable Area); but not including electricity required for electronic data processing equipment, special lighting in excess of Building Standard, and any other item of electrical equipment, the electrical power equipment of which (singly) is more than 0.5 kilowatts per hour at rated capacity or requires a voltage other than 120 volts single phase; and provided that if the installation of said electrical equipment requires additional air conditioning capacity above that provided by the Building Standard system, then the additional air conditioning installation and operating costs will be the obligation of Tenant. Landlord, at its option, may cause a water meter, electric current meter or such similar device to be installed on the Premises so as to measure the amount of water and electric current consumed by Tenant. The cost of any such meters and of the installation, maintenance and repair thereof shall be paid for by Tenant and Tenant agrees to pay to Landlord, promptly upon demand by Landlord, for all such excess water and electric expense incurred. If a separate meter is not installed or Landlord is prevented from installing a separate meter by operation of law or other cause beyond Landlord's control, such excess costs for such water and electric current will be established by an estimate made by the utility company, electrical engineer, or an independent consultant, which estimate shall be binding on Tenant.

 

 

Tenant shall pay Landlord, upon demand, such additional amounts as are necessary to recover additional costs

 

(d)  Cost of all maintenance, security, window cleaning, elevator maintenance, landscaping, repair, janitorial, and other similar service agreements for the Project and the equipment and other personal property of Landlord therein and thereon used in connection with the operation, management, repair or maintenance of the Project.

 

(e)   Cost of all insurance relating to the Project and its occupancy or operations, including but not limited to (i) the cost of rent loss and casualty and liability insurance applicable to the Project or Landlord's personal property used in connection with the operation of the Project, (ii) The cost of business interruption insurance in such amounts as will reimburse Landlord for all losses of earnings and other income attributable to the ownership and operation of the Project, and (iii) the cost of insurance against such perils and occurrences as are commonly insured against by prudent landlords.

 

(f)All taxes, assessments, and governmental charges and fees of whatsoever nature, whether now existing or subsequently created, attributable to the Project or its occupancy or operation, excluding only federal, state and local income taxes or the state or local equivalent of the federal income tax by whatever name it may be known except the current Texas Franchise Tax of Landlord, and including all such taxes whether assessed to or paid by Landlord or third parties, but excluding such taxes to the extent, if any, that Tenant, any other tenant of the Project, or any other party specifically reimburses Landlord therefore (other than through the payment of Operating Expense reimbursements). Without limiting the generality of the foregoing, if at any time during the term of this Lease, there shall be levied, assessed or imposed on Landlord a capital levy or other tax directly on the rents received therefrom and/or a franchise tax, assessment, levy or charge measured by or based, in whole or in part, upon such rents from the Project and/or the land and improvements of which the Project is a part, then all such taxes, assessments, levies or charges, or the part thereof so measured or based, shall be deemed to be included within the term "Operating Expenses" for the purposes hereof.

 

(g)  Costs of repairs to and maintenance of the Project, excluding any such costs as are paid by the proceeds of insurance, by Tenant, or by other third parties.

 

(h)  A management fee for management services rendered in connection with the Project.

 

(i) Amortization of the cost of capital investment items which are installed primarily to reduce Operating Expenses for the benefit of all of the Project's tenants or which may be required by any governmental authority. All such costs, including interest costs, shall be amortized over the reasonable life of the capital investment items, with the reasonable life and amortization schedule being determined by Landlord according to generally accepted accounting principles, but in no event to extend beyond the reasonable life of the Building.

 

(j) Landlord's central accounting costs, and legal, appraisal, and other such third party fees relating to the operation of the Project.

 

(k) The fair market rental value of Landlord's and the property manager's offices, if any, in the Building provided the rental area is not in excess of 250 square feet of rental area per person on the property management staff.

 

Notwithstanding the foregoing provisions of this Section 5.02, "Operating Expenses" shall not include any of the following:

 

(1)  Costs incurred by Landlord for alterations, additions and replacements which are considered capital expenditures under generally accepted accounting principles, consistently applied, except to the extent provided in Section 5.02(i).

 

(2)  Any costs or expenditures for which (and to the extent) Landlord is entitled to reimbursement by Tenant (other than pursuant to this Article 5), any other tenant of the Project (other than through the payment of Operating Expense reimbursements), insurance, or condemnation proceeds.

 

(3)  The cost of preparing, renovating, painting, decorating, or otherwise modifying any part of the Building other than Building Common Areas and Floor Common Areas.

 

(4)  Leasing commissions, ground rentals (except to the extent the same may be made to pay insurance or taxes), non-cash items (including, without limitation, depreciation, except to the extent provided in Section 5.02(i), and obsolescence), debt service (principal and interest) and other debt costs, and advertising and promotional expenditures.

 

 

If this Lease commences on other than the first day of a calendar year, or if this Lease expires on other than the last day of a calendar year, then the Operating Expenses for all of such calendar year shall be prorated according to the portion of the Term that occurs during such calendar year. If at any time the Building is not fully occupied or Landlord is not supplying all services to all portions of the Building during an entire calendar year, then Operating Expenses shall be adjusted as though the Building had been fully occupied and Landlord were supplying all services to all portions of the incurred by Landlord in performing or providing non-standard janitorial maintenance, security, or other services or requirements of Tenant or in performing any services (and in paying additional taxes) as to any Non-Building Standard installations in the Premises. Tenant shall pay Landlord, upon demand, reasonable charges for providing off-hour and non-standard air conditioning, heating and electricity; provided, however, that Tenants excessive use or consumption of heating, air conditioning and/or electrical services in violation of Section 7.01 above, without Landlords prior written consent, shall constitute a default under this Lease.

 

Any failure or defect in Landlord's hereinabove described services shall not be construed as an eviction of Tenant, nor entitle Tenant to any reduction, abatement, offset, or refund of Rent or to any damages from Landlord. Landlord shall not be in breach or default under this Lease, provided Landlord uses reasonable diligence to restore any such failure or defect after Landlord receives written notice thereof.

 

Landlord shall furnish to Tenant fifty (50) keys for each corridor door entering the Premises. Additional keys, after the initial keys, will be furnished at a charge by Landlord on an order signed by Tenant or Tenant's authorized representative. All such keys shall remain the property of Landlord. No additional locks shall be allowed on any door of the Premises without Landlord's permission, and Tenant shall not make, or permit to be made any duplicate keys, except those furnished by Landlord. Upon termination of this Lease, Tenant shall surrender to Landlord all keys to the Premises, and give to Landlord an explanation of the combination of all locks for safes, safe cabinets and vault doors, if any, in the Premises.

 

Landlord shall provide and install all letters and numerals on entrance doors in or at the Premises, entrance to Tenant suite, the building directory for Tenant and designated affiliates and subsidiaries. All such letters and numerals are to be Building Standard graphics, and no other letters, numbers, or signage shall be used or permitted on the Premises without the prior written consent of Landlord. The Landlord intends to erect a multi-tenant monument sign. Tenant and Tenants subsidiaries and affiliates may place their names on the sign. Tenant agrees to pay for its prorate share of the cost of the sign. In the event a portion of the Tenant Improvement Allowance is unused Tenant may apply the excess Allowance toward Tenants share of the cost of the sign.

 

 

Tenant shall make no alterations, installations, additions, or improvements in or to the Premises or place signs on the Premises which are visible from outside the Premises, without Landlord's prior written consent. All alterations, installations, additions or improvements, other than moveable furniture and moveable trade fixtures, made by Tenant to the Premises shall remain upon and be surrendered with the Premises and become the property of Landlord at the expiration or termination of this Lease or the termination of Tenant's right to possession of the Premises; provided, however, that Landlord may require Tenant, at Tenants cost, to remove any or all of such items that are not Building Standee upon the expiration or termination of this Lease or the termination of Tenant's right to possession of the Premises. All work performed by Tenant with respect to the Premises shall (a) be performed so as not to alter the exterior appearance of the Building, (b) be preformed by a contractor approved in writing by Landlord, (c) be performed so as not to adversely affect the structure or safety of the Building, (d) comply with all building, safety, fire, and other codes and governmental and insurance requirements, (e) be performed so as not to result in any usage in excess of Building Standard of water, electricity, gas, heating, ventilating, or air conditioning (either during or after such work) unless prior written arrangements reasonably satisfactory to Landlord are made with respect thereto, (f) be completed promptly and in a good and workmanlike manner, and (g) be performed in such a manner that no valid mechanic's, materialman's, or other similar liens attached to Tenant's leasehold estate and in no event shall Tenant permit, or be authorized to permit, any such liens (valid or alleged) or other claims to be asserted against Landlord or Landlord's rights, estates, and interests with respect to the Project or this Lease. In all events, Tenant shall not be entitled to perform any work unless and until Tenant has obtained and furnished to Landlord an appropriate workman's compensation policy covering all workmen and a general liability policy naming Landlord as a co-insured with policy limits not less than $1,000,000. Landlord may require, at Tenant's sole cost and expense, a lien and completion bond in an amount equal to the estimated cost of any improvements, additions or alterations in the Premises which have been approved by Landlord.

 

Tenant agrees to remove all of its trade fixtures, personal property and, at Landlord's request pursuant to Section 8.01, Non-Building Standard items, on or before the date of expiration or termination of the Term, and shall promptly reimburse Landlord for the cost of repairing all damage done to the Premises or the Project by such removal and the cost of restoring the Premises to their original condition, reasonable wear and tear excepted, after such removal.

 

 

 

 

 

 

 

 

 

 

 

 

If the Premises or Project, or any portion of either, shall be damaged by fire or other casualty covered by the insurance carried by Landlord hereunder, and the cost of repairing such damage shall not be greater than ten percent (10%) of the then full replacement cost thereof, then, subject to the following provisions of this Article, Landlord shall repair the Premises and/or Project. If the Premises or Project shall be damaged (a) by fire or other casualty not covered by insurance carried by Landlord hereunder, (b) by fire or other casualty covered by insurance carried by Landlord hereunder and Landlord's mortgagee requires that such insurance proceeds be used to retire the mortgage debt, or (c) to an extent greater than ten percent (10%) of the then full replacement cost thereof, then Landlord shall have the option to either (i) repair or reconstruct the same to substantially the same condition as immediately prior to such fire or other casualty, or (ii) terminate this Lease by so notifying Tenant within one hundred twenty (120) days after the date of such fire or other casualty, such termination to be effective as of the date of such notice. The Rent required to be paid hereunder shall be abated in proportion to the portions of the Premises, if any, which are rendered untenantable by fire or other casualty hereunder until repairs of the Premises are completed, or if the Premises are not repaired, until the termination date hereunder. Other than such Rent abatement, no damages, compensation or claim shall be payable by Landlord for loss of the use of the whole or any part of the Premises, Tenants personal property, or any inconvenience, loss of business, or annoyance arising from any such repair and reconstruction. If the damage results from default or negligence of Tenant, its agents, employees, licensees or invitees, then Tenant shall not be entitled to any abatement or reduction of any Rent or other sums due hereunder and, if the cost to repair such damage is not fully covered by Landlord's insurance, such damage shall be repaired by Tenant, or at Landlord's option by Landlord, at Tenant's expense (to the extent Landlord is not reimbursed by insurance). If this Lease is terminated as provided in (c)(ii) above, all Rent shall be apportioned and paid up to the termination date. Landlord shall not be required to repair or replace any furniture, furnishings or other personal property which Tenant may be entitled to remove from the Premises or any property constructed and in­stalled by or for Tenant pursuant to Section 8.01 hereof or any installations in excess of Building Standard.

 

Notwithstanding anything to the contrary in this Article, Landlord shall not have any obligation whatsoever to repair, reconstruct or restore the Premises or the Project when the damage resulting from any casualty covered under this Article occurs during the last twelve (12) months of the Term or any extension thereof.

 

 

If all or substantially all of the Premises be taken by virtue of eminent domain or for any public or quasi-public use or purpose, this Lease and the estate hereby granted shall terminate on the date the condemning authority takes pos­session. If only a part of the Premises is so taken, or if a portion of the Project not including the Premises is taken, this Lease and the estate hereby granted shall, at the election of Landlord, either (i) terminate on the date the condemning authority takes possession by giving notice thereof to Tenant within thirty (30) days after the date of such taking of possession, or (ii) continue in full force and effect as to that part of the Premises not so taken and the Base Rent shall be reduced (from and after the date of such taking of possession) in the proportion that the number of square feet of the Premises so taken, if any, bears to the total number of square feet contained in the Premises.

 

Landlord shall be entitled to the whole of any and all awards which may be paid or made in connection with any such taking, except that Tenant shall be entitled to make a separate claim with the condemning authority for (a) any moving expenses incurred by Tenant as a result of such condemnation, and (b) any relocation costs incurred by Tenant.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Each of the following shall constitute a "Default" by Tenant:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unless otherwise provided by law, and without intending to exclude any other manner of giving Tenant reasonable notice, the requirement of reasonable notice shall be met if such notice is given in the manner prescribed in this Lease at least seven (7) days before the time of sale. Any sale made pursuant to the provision of the paragraph shall be deemed to have been a public sale conducted in commercially reasonable manner if held on the Premises or where the property is located after the time, place and method of sale and a general description of the types of property to be sold have been advertised in a daily newspaper published in the county in which the property is located for five (5) consecutive days before the date of the sale. The proceeds from any such disposition, less any and all expenses connected with the taking of possession, holding and selling of the property (including reasonable attorney's fees and legal expenses), shall be applied as a credit against the indebtedness secured by the security interest granted in this paragraph. Any surplus shall be paid to Tenant or as otherwise required by law; the Tenant shall pay any deficiencies forthwith. Upon request by Landlord, Tenant agrees to execute and deliver to Landlord a financing statement in form sufficient to perfect the security interest of Landlord in the aforementioned property and proceeds thereof under the provision of the Uniform Commercial Code (or corresponding state statute or statutes) in force in the State in which the property is located, as well as any other state laws of which Landlord may at any time consider to be applicable. Landlord and Tenant agree that a carbon, photographic or other reproduction of this Lease is sufficient as, and may be filed as, a financing statement.

 

In the event that Landlord shall have taken possession of the Premises pursuant to the authority herein granted, then Landlord shall have the right to keep in place and use all of the furniture, fixtures and equipment at the Premises, including that which is owned by or leased to Tenant, at all times prior to any foreclosure thereon by Landlord or repossession thereof by any lessor thereof or third party having a lien thereon. Landlord shall also have the right to remove from the Premises (without the necessity of obtaining a distress warrant, writ of sequestration or other legal process) all or any portion of such furniture, fixtures, equipment and other property located thereon and place same in storage at any premises within the county where the Building is located, including premises owned by Landlord or an affiliate of Landlord; and in such event, Tenant shall be liable to Landlord for costs incurred by Landlord in connection with such removal and storage and shall indemnify and hold Landlord harmless from all loss, damage, cost, expense and liability in connection with such removal and storage. Landlord shall also have the right to relinquish possession of all or any portion of such furniture, fixtures, equipment and other property to any person ("Claimant") claiming to be entitled to possession thereof who presents to Landlord a copy of any instrument represented to Landlord by Claimant to have been executed by Tenant (or any predecessor of Tenant) granting Claimant the right under various circumstances to take possession of such furniture, fixtures, equipment or other property, without the necessity on the part of Landlord to inquire into the authenticity of said instrument copy or Tenant's (or Tenant's predecessor's) signature thereon and without the necessity of Landlord's making any nature of investigation or inquiry as to the validity of the factual or legal basis upon which Claimant purports to act; and Tenant agrees to indemnify and hold Landlord harmless from all cost, expense, loss, damage and liability incident to Landlord's relinquishment of possession of all or any portion of such furniture, fixtures, equipment or other property to Claimant. The rights of Landlord herein stated shall be in addition to any and all other rights which Landlord has or may hereafter have at law or in equity; and Tenant stipulates and agrees that the rights herein granted Landlord are commercially reasonable.

 

In the event of a default or breach by Landlord under this Lease, then Tenant shall be entitled to such rights and remedies as may be available to Tenant at law or in equity.

 

 

Tenant hereby represents and warrants to Landlord the following:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Landlord shall ensure the quiet enjoyment of the premises is maintained for Tenant during the exhibition of the premises. Landlord will assure that prospective tenants are properly escorted to ensure adequate protection and security of the property of Tenant during any exhibition of the premises. Due to the sensitive nature of Tenants business involving the legal and tax records of clients of Tenant, Landlord agrees that Tenant may refuse to allow exhibition of certain areas containing sensitive client data unless Tenant is provided with two (2) business days notice of time and date of desired exhibition.

 

 

 

Time is of the essence of this Lease and all of its provisions in which performance is a factor.

 

 

 

 

 

The captions in this Lease are inserted only as a matter of convenience and for reference only and they in no way define, limit, or describe the scope of this Lease or the intent of any provisions hereof,

 

 

 

 

 

 

 

 

 

	Signature Patrick Cox President

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit "A" - Land

Exhibit "B" - Floor Plans

Exhibit "C" - Definition of Rentable Area

Exhibit "D" - Leasehold Improvements

Exhibit "E" - Parking

Exhibit "F" - Rules and Regulations

Exhibit "G" - Special Provisions

 

 

 

 

 

 

LAND

 

METES AND BOUNDS DESCRIPTION

 

2.1104 ACRES OF LAND OUT OF THE

 

GEORGE BELLOWS SURVEY, ABSTRACT 3

 

HOUSTON, TEXAS

 

2.1104 acres (91.927 square feet) of land, being all that certain tract described in a deed from Town & Country Financial Corporation to Town & Country Bank, Dated December 11, 1974, recorded in Clerks File (C.F.) G365463, (C.F.) Official records of Harris County, Texas (H.C.O.P.R.R.P.), and a deed from Town & Country Office Park Joint Venture to Town and Country Bank. dated December 6, 1979, recorded in Clerks File 0350693, H.C.O.P.R.R.P, out of the George Bellows Survey, Abstract 3. Houston, Harris County, Texas. and being more particularly described by metes and bounds as follows;

BEGINNING at a chiseled "X" in concrete set at the intersection of the west line of Town and Country Boulevard (60 feet wide), as described in a deed from Town & County Office Park Joint Venture to the City of Houston, dated September 2, 1971, recorded in C.F.1)416796, H.C.O.P.R,R.P., with the north line of Town and Country Lane (60 feet wide), as dedicated by the subdivision plat of Town & Country Extension, recorded in Volume 166, Page 35, Harris County Map Records (H.C.M.R.) and the southeast corner hereof;

 

THENCE, N 00° 23' 00"W, a distance of 295.86 feet, along the west line of Town and Country Boulevard, to a 5/8 inch iron rod found, as called, for the northwest corner hereof and the southwest cornet of a called 2.1678 acre tract described in a deed from Creole Stewart & Stevenson Realty Corporation, dared September 12, 1995, recorded in C.F. R 741676, H.C.O.P.R.R.P

 

THENCE, N 89° 37' 00" E, a distance of 310.24 feet, leaving the west line of Town & Country Boulevard to a 5/8 inch iron rod set for the northeast corner hereof and the southeast corner of said Stewart & Stevenson tract in the west line of Unrestricted reserve "A", called 3.8581 acres, as decried in the plat of BED, Bath & Beyond, as recorded in Volume'364, page 98, 1- 1.

 

THENCE, S 00° 34' 00" E, a distance of 295.86 feet, to a 1 — V: inch iron pipe found in the north line of Town & Country Lane for the southeast corner hereof and the southwest corner of said reserve "A";

 

Thence, S 89° 37' 00" W, a distance of 311.19 feet, along the north line of Town and Country Lane to the POINT OF BEGINNING, delineating and encompassing within the metes recited 2.1104 acres (91,927 square feet) of land, more or less, based on the Land Title Survey and plat made by Thompson Surveying Company, Houston, Texas on April 16, 1998.

 

 

 

 

 

FLOOR PLANS

 

 

 

 

 

 

 

 

The term "Rentable Area shall mean the area or areas determined, in square feet, as follows: (i) the Rentable Area on a single-tenant floor shall be (a)the entire area bounded by the inside face of glass panes that are part of the exterior walls of the Building, excluding only the area contained within the same (measured from the mid-point of dividing walls) used for the Building Common Areas (hereinafter defined) located on such floor, Building stairs, fire towers, vertical ducts, elevator shafts, flues, vents, stacks, and pipe shafts, but including all other areas on such floor, plus (b) a pro-rata part of Building Common Areas, and (ii) the Rentable Area for a multi-tenant floor shall be (a) the entire area bounded by the inside face of glass panes that are part of exterior walls of the Building, the exterior face of any partitions that separate the Premises from Floor Common Areas (hereinafter defined) and the mid-point of partitions that separate the Premises from adjoining tenant spaces, plus (b) a pro-rata share of Floor Common Areas and Building Common Areas. The term "Common Areas" as used herein shall mean all Building corridors, lobbies, rest rooms, jani­tor closets, vending rooms, telephone rooms, mechanical rooms, electrical rooms, and other areas not for the exclusive use of any particular tenant, The term "Floor Common Areas" shall mean all Common Areas on a floor except those Common Areas, if any, that are primarily for the benefit of more than one floor, such as elevator mechanical rooms and Building lobbies. The term "Building Common Areas" shall mean all Common Areas that are not Floor Common Areas. No deductions from Rentable Area shall be made for columns or other structural portions or projections necessary to the Building. Notwithstanding the foregoing, for purposes of this lease the term Rentable Area shall be deemed to be 14,469 square feet.

 

 

 

 

 

 

 

These terms defined in Article 1 of this Exhibit "ID", for all purposes of this Exhibit "D", shall have the meaning herein specified, and, in addition to the terms defined herein, the definitions otherwise in the Lease to which this Exhibit "D" is attached shall also apply to this Exhibit "D".

 

1.01 "Building Standard" means the quantity or quality of materials, finishes, and workmanship from time to time specified by Landlord as being standard for office space in the Building.

 

1.02 'Landlord's Work' means the Building Standard items which are supplied, installed and finished by Landlord, according to the Building Standard specifications, and which shall be paid for by Landlord as provided for below.

 

1.03 "Tenants Work" means the items which are supplied, installed, and fumished by Landlord on behalf of Tenant, as provided for hereinbelow, which exceed Building Standard specifications in terms of quality as described in Landlord's Work, which shall be paid for by Tenant as provided for below.

 

1.04 "Landlord's Contractor" means the person or firm from time to time selected by Landlord to construct and install the Leasehold Improvements (as defined below) in the Premises.

 

1.05 "Non-Building Standard' means all materials, finishes, and workmanship used in connection with the construction and installation of the Leasehold Improvements which exceed or deviate from Building Standard in terms of quantity or quality (or both).

 

1.06 "Leasehold Improvements" shall mean the aggregate of the Landlord's Work and Tenant's Work.

 

1.07 "Landlord's Designer" shall mean the architect or space planner engaged by Landlord to prepare the plans and specifications for the Leasehold Improvements as contemplated by Article 2 hereof.

 

1.08 "Tenants Designer shall mean an architect or space planner selected by Tenant and reasonably approved by Landlord.

 

1.09 "Landlord's Engineer shall mean the person or firm hired by Landlord to provide the mechanical, electrical and plumbing drawings and services.

 

1.10 "Construction Documents" shall mean the final architectural, mechanical and electrical construction plans, detailed specifications and finish schedules.

 

 

 

2.01 Within ten (10) working days after the execution of this Lease, Tenant, at Tenants expense, shall provide Landlord with sufficient instructions and information to enable Landlord's Designer to prepare and complete the plans and specifications for the Leasehold Improvements. Such plans and specifications shall be prepared by Landlord's Designer and submitted to Tenant, for Tenants approval. Within ten (10) working days after Tenants receipt of such plans, specifications and cost estimate, Tenant shall notify Landlord in writing as to whether Tenant approves or disapproves same. Tenant will be allowed three (3) revisions of such plans and specifications. Any additional revisions will be at the sole expense of Tenant. Upon Tenant's approval, Landlord's Designer and Engineer will prepare all Construction Documents necessary for construction of the Leasehold Improvements. If Tenant fails to expressly disapprove such plans, specifications and cost estimate within this ten (10) working day period, then Landlord shall be authorized to proceed thereon. The cost of all plans, specifications and Construction Documents for Building Standard Leasehold Improvements shall be borne and paid by Landlord. All plans, specifications and Construction Documents for Non-Building Standard Leasehold Improvements shalt be borne and paid for by Tenant, unless specified to the contrary in the Lease.

 

2.02 Unless otherwise agreed to in writing by Landlord and Tenant, all work involved in the construction and installation of the Leasehold Improvements shall be carried out by Landlord's Contractor under the sole direction of Landlord. Tenant shall cooperate with Landlord's Contractor under the sole direction of Landlord's Designer to promote the efficient and expeditious completion of such work. Tenant agrees to pay Landlord, promptly upon being billed therefore, the cost (labor and material) of all Tenants Work, together with a fee to Landlord of fifteen percent (15%) of such cost as compensation for Landlord's supervision of the construction and installation of Tenants Work. Landlord at its option may require Tenant to make an advance payment of fifty percent (50%) of the estimated cost of Tenants

 

 

 

 

2.03 If there are any changes in the Leasehold Improvements caused by Tenant from the work as reflected in the Construction Documents, each such change must receive the prior written approval of Landlord, and, in the event of any such approved change in the Construction Documents, Tenant shall, at Tenant's expense, upon completion of Tenants Work, furnish Landlord with accurate "as built" reproducible mylar plans of Tenants Work as constructed, which plans shall be incorporated into this Exhibit "D" by this reference for all intents and purposes.

 

2.04 Under no circumstances whatsoever will Tenant, or Tenants authorized representative, ever alter or modify or in any manner disturb any central system or installation of the Building, including, but not limited to, exterior building, central plumbing system, central fire protection and fire alert systems, central building maintenance systems, central structural systems, elevators, and anything located within the central core of the Building. Only with Landlord's express written permission and under direct supervision of Landlord or Landlord's authorized representative shall Tenant or Tenants authorized representative alter or modify or in any manner disturb any branch of any system or installation of the Building which is located within the Premises, including, but not limited to, branch electrical, heating, ventilating and air conditioning systems, and branch fire protection and alert systems. For the purposes of this Section 2.04, "central" shall be defined as that portion of any Building system or component which is within the core and/or common to and/or serves or exists for the benefit of other tenants in the Building; and "branch" shall be defined as that portion of any Building System or component which serves to connect or extend central systems into the Premises.

 

2.05 Landlord shall have no obligation to commence installation of any of the Leasehold Improvements in the Premises until (a) Tenant shall have approved the plans and specifications for such work as required by Section 2.01 hereof and (b) Landlord shall have received any advance payment required by Landlord under Section 2.02 of this Exhibit "D".

 

 

Landlord agrees to provide, at Landlord's sole cost and expense, the following items. No credit shall be allowed for Building Standard items not used. Remodel restrooms on fourth (4th) floor and to meet ADA requirements. Replace ceiling tiles throughout the fourth (4W) floor. Landlord shall replace 2x4 light fixtures on the fourth (4th) floor as needed to meet current fire codes.

 

 

4.01 Any Non-Building Standard Leasehold Improvements to be constructed in the Premises shall be constructed by Landlolt at Tenant's cost, provided, however, all such improvements shall be expressly subject to review and approval by Landlord. Prior to the commencement of construction of such additional improvements, Landlord shall submit to Tenant Landlord's written estimate of the cost of constructing such Non-Building Standard Leasehold Improvements, including the cost of preparing detailed plans and specifications for the Premises. Tenant covenants and agrees to promptly furnish to Landlord all information necessary for Landlord's written estimate of the cost of such work described above.

 

 

The following shall be considered delays caused by Tenant:

 

D.         Tenants disapproval, or failure to approve, Landlord's cost estimate of Tenants Work as required by Section 2.01 of this Exhibit "V within the time periods set forth therein.

 

 

 

 

 

 

 

1.      Cars must be parked entirely within the stall lines painted on the floor.

2.      All directional signs and arrows must be observed.

3.      The speed limit shall be 5 miles per hour.

4.      Parking is prohibited:

(a)       in areas not striped for parking

(b)       in aisles

(c)       where no parking" signs are posted

(d)       in cross hatched areas

(e)       in such other areas as may be designated by Landlord or Landlord's agent(s).

6.     Garage managers or attendants are not authorized to make or allow any exceptions to these Rules and Regulations.

7.     Every parker is required to park and lock his own car. All responsibility for damage to cars or persons is assumed by the parker.

 

Failure to promptly pay the rent required hereunder or persistent failure on the part of Tenant or Tenants designated packers to observe the rules and regulations above shall give Landlord the right to terminate Lessee's right to use the parking structure. No such termination shall create any liability on Landlord or be deemed to interfere with Tenants right to quiet possession of the Premises.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

objectionable to Landlord or other occupants of the Project by reason of light, radiation, magnetism, noise, odors and/or vibrations, or interfere in any way with other tenants or those having business in the Project.

 

 

 

 

 

 

 

 

 

 

 

 

24.        Tenant shall at all times keep the Premises neat and orderly.

 

 

 

 

 

 

 

 

 

 

 

 

Time Period	# Months	Rate/RSF	Rent/Month	Total Rent
03/01/07 - 06/30/07	4	$0.00	$0.00	$0.00
07/01/07 - 08/31/08	14	$10.00	$12,057.50	$168,805.00
09/01/08 - 02/28/11	30	$15.00	$18,086.25	$542,587.50
03/01/11 - 02/28/12	12	$15.75	$18,990.56	$227,886.74
03/01/12 - 02/28/14	24	$16.25	$19,593.44	$470,242.48

 

2. TENANT ALLOWANCE:

 

 

3.  RIGHT OF FIRST REFUSAL

 

As long as Tenant is not in default and Tenant has not been in monetary default two (2) times during the term then Tenant shall have an ongoing of first refusal ("ROFR") to lease available space in the building; provided, however, that Landlord shall be obligated and entitled to comply with any rights of existing tenants. Tenant's right of first refusal may be exercised only upon Landlord's presentation to Tenant of a third party's offer (Offer") to lease ROFR space containing the relevant terms satisfactory to Landlord, Upon receipt of such Offer, Tenant shall have three (3) days in which to accept or reject said Offer (a failure to respond within said period shall be deemed a rejection).

 

Should Tenant reject said Offer, Landlord shall be relieved of any further rights of first offer; should Tenant accept said Offer, Landlord will within five (5) business days, prepare an amendment to the Lease (the "Amendment') reflecting the third party's terms and Tenant will execute the Amendment within ten (10) days following the receipt of such Amendment. The commencement date of the ROFR space shall be the earlier of (i) the third party's commencement date or (ii) thirty (30) days after the execution of the Amendment.

 

This ROFR shall (a) A subject to the Landlord's approval of Tenant's current financial conditions of Tenant being that of the same or better quality as of the date of the signing of the Lease and (b) shall not be valid if Tenant has subleased or assigned any portion of the Leased Premises,

 

The rental rate on ROFR space shall be as follows:

 

$15.50 / ref / year if the Tenant leases any ROFR space within the first two (2) years of the Lease Term.

 

$16.25 rsf / year if Tenant lease any ROFR space after the end of the second year of the Lease Term.

 

In the event the Tenant leases any ROFR space after the 3rd year of the Lease Term, Tenant must extend the Term of the Lease on all of the Leased Premises, effective on the commencement date of the FOFR space, for four (4) additional years.

 

As long as Tenant is not in default and Tenant has not been in monetary default two (2) or more times during the term then Tenant shall have one (1) renewal option and shall be for five (5) years. Tenant shall exercise said renewal option no earlier than nine (9) months prior to the then current expiration date and the renewal rent shall be the prevailing Fair Market Value Rental Rate.

 

FAIR MARKET VALUE RENTAL RATE: For the purposes of definition in this Lease document, Fair Market Value Rental Rate shall have the following meaning:

 

With respect to the Renewal Option contained herein, the applicable "Fair Market Value Rental Rate" shall be that rate charged for space of comparable size and condition in comparable office buildings in the area in which the Building is located, taking into consideration the location, quality and age of the building, floor level, extent of leasehold improvements (existing or to be provided), term of lease, extent of services to be provided, distinction

 

 

 

 

 

 

 

 

 

 

 

 

This First Amendment to Office Lease ("First Amendment") is made and entered into on this 22nd day of January, 2008, by and between Jim R. Smith Interest ("Landlord") and TMIRS Enterprises, Ltd dbla TaxMasters ("Tenant").

 

 

Landlord and Tenant entered into that certain Office Lease effective as of the 21st day of December, 2006, "Original Lease Agreement" covering approximately 14,469 square feet of space located on the 3rd and 4th floor of the building known as Suite 400 located at 900 Town & Country Street ("Building"), Houston, Texas ("Original Leased Premises").

 

Now, therefore, for and in this Consideration of mutual covenants set out in this First Amendment, Landlord and Tenant agree to extend and modify this Lease as follows:

 

1.  Premises: Tenant shall expand the Original Leased Premises by approximately 5,086 rentable square feet on the 3rd floor of the Building as shown on Exhibit A attached hereto ("Expansion Premises").

 

2.  Term: The Term for the Expansion Space shall commence on May 1, 2008. The expiration date for the Expansion Space shall be May 31, 2014 ("Expiration Date").

 

3.  Rental Rate:The Rental Rate for the Expansion Space shall be paid in monthly installments as set forth below:

 

 

4.  Operating Expense Reimbursements. Tenant's Proportionate Share shall be increased to 17.903% to reflect the increase in square footage, Tenant's reimbursement of Operating Expenses for the Expansion Space shall be based on the calendar year 2007.

 

5.  Leasehold Improvements: Landlord shall tender and Tenant shall accept the Expansion Space in "AS-IS" CONDITION, with all FAULTS, and without any warranty, express, implied, or statutory (including implied warranties of habitability, suitability, condition, and fitness for a particular purpose, all of which are hereby disclaimed).

 

Landlord shall provide a tenant improvement allowance equal to $13.71 I rsf ("Allowance"). Any cost incurred that exceeds the Allowance shall be paid for by Tenant within thirty (30) days after receipt of an invoice from the Landlord. It is mutually agreed that the Landlord will not charge a construction management fee to manage the construction of the Tenant Improvements.

 

6.  Parking:Tenant shall be granted an additional nineteen (19) parking spaces.

 

Except as expressly modified by this Amendment, the Leases continues in full force and effect as originally executed and delivered.

 

This Amendment is binding upon and insures to the benefit of Landlord and Tenant and their respective successors and assigns.