Exhibit 10.1

 

    Re:    4450 Sojourn Drive        Addison, Texas 75001

FIFTH AMENDMENT TO LEASE

THIS FIFTH AMENDMENT TO LEASE (this “Amendment”) has been executed as of the
23rd day of November, 2009 (the “Effective Date”), by TNPPM LAKEVIEW SOJOURN,
LLC, a Delaware limited liability company (“Landlord”) acting by and through TNP
Property Manager, LLC (“Agent” for Landlord), and AFFIRMATIVE PROPERTY HOLDINGS,
INC., a Texas corporation (“Tenant”).

R E C I T A L S:

A. Wilcox Sojourn Development, Ltd. (“Prior Landlord”) and Tenant as
successor-in-interest to Old American Services, Inc., and by name change from
American Agencies Properties Holdings, Inc. (“Prior Tenant”) have heretofore
executed that certain Lease Agreement (the “Original Lease”), dated June 3,
1999, as amended by First Amendment to Lease, dated as of July 26, 1999, Second
Amendment to Lease, dated as of August 1, 2000, Third Amendment to Lease, dated
August 4, 2003 and Fourth Amendment to Lease, dated as of December 14, 2004,
pursuant to which Tenant leased approximately 56,888 rentable square feet of
space in that certain building located at 4450 Sojourn Drive, Addison, Texas,
75001, and more particularly described in the Lease (the “Building”). The
Original Lease, as so amended, being referred to as the “Lease”. Unless
otherwise defined herein, all initially capitalized terms will have the
respective meanings assigned thereto in the Lease.

B. Landlord has acquired the Building and succeeded to all of Prior Landlord’s
interest as landlord under the Lease. Tenant has assumed all of Prior Tenant’s
obligations under the Lease.

C. Landlord and Tenant desire to execute this Amendment in order to evidence
their agreement to make certain other amendments to the Lease, all as more
particularly set forth in this Amendment.

NOW THEREFORE, in consideration of the foregoing and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Landlord and Tenant agree as follows:

Article I

CERTAIN AMENDMENTS

SECTION 1.01. Term of Lease. As of the date hereof, the Term of the Lease shall
be extended through and including March 31, 2015, subject to adjustment or
earlier termination as set forth in the Lease. Except as set forth in Exhibit B,
Tenant shall have no further extension or renewal rights under the Lease and any
and all said rights are deleted.

 

FIFTH AMENDMENT TO LEASE – Page 1 of 15

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SECTION 1.02. Base Rental. As of December 1, 2009, the Base Rental due and
payable by Tenant to Landlord under the Lease during the Term will be as
follows:

 

Months

  Annual Base Rental           Monthly               Rate per R.S.F.*       Base
Rent*        

12/1/09 - 10/31/10

  $15.00   $71,110.00                

11/1/10 - 10/31/11

  $15.30   $72,532.00                

11/1/11 - 10/31/12

  $15.80   $74,903.00                

11/1/12 - 10/31/13

  $16.00   $75,851.00                

11/1/13 - 10/31/14

  $16.20   $76,799.00                

11/1/14 - 3/31/15  

  $16.40   $77,747.00                

*     Landlord hereby conditionally abates (a) the amount of $59,520.00 per
month from the Base Rental for the period commencing December 1, 2009 through
May 31, 2010 and (b) monthly installments of Basic Rent described above for the
following months: June 2010, July 2010, June 2011, July 2011 and June 2012 all
on the condition Tenant fulfills all Lease obligations. Tenant shall pay all
other obligations accruing during such months. If Tenant defaults under the
Lease, beyond any applicable period of notice and cure, any remaining rent
abatement shall cease from the date of such default, and Tenant shall
immediately pay to Landlord all sums previously abated hereunder.

  

The Base Rental under the Lease shall be due and payable in equal monthly
installments, each such monthly installment due and payable on the first day of
each calendar month, in advance, without demand and without setoff or deduction
whatsoever, except as otherwise expressly provided in the Lease. In addition,
notwithstanding anything contained in the Lease to the contrary, Tenant shall
pay to Landlord any applicable margin taxes at the rate in effect from time to
time and all other amounts stated in the Lease, as amended by Section 1.03
below.

SECTION 1.03. Base Year. As of December 1, 2009, (a) the Base Year shall be
amended to be the calendar year 2009, (b) the reference to “eight percent
(8.0%)” in Section 1.11 of the Original Lease is deleted and replaced with “four
percent (4.0%)”, and (c) all references to 1.08 in Section 1.11 of the Original
Lease are deleted and replaced with 1.04.

SECTION 1.04. Commissions. Landlord and Tenant acknowledge that no brokers have
been involved in this Amendment other than John Bowles Company and CresaPartners
(“Brokers”), each by separate written agreement, and Landlord will be solely
responsible for the commissions, if any, owed such Brokers pursuant thereto.
Landlord and Tenant hereby indemnify each other from the payment of any
commissions owed to any broker (other than those brokers identified in this
Section 1.04) with respect to this Amendment resulting from the acts of such
party, but not otherwise.

SECTION 1.05. AS IS. Tenant accepts the Premises “AS-IS” and Landlord has no
obligation to make, or pay or otherwise reimburse Tenant for, any improvements,
alterations or additions to the Premises except as set forth in Exhibit A.

 

FIFTH AMENDMENT TO LEASE – Page 2 of 15

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SECTION 1.06. Extension Option. Landlord hereby grants to Tenant an Extension
Option pursuant to Exhibit B attached hereto.

SECTION 1.07. Security Deposit. Provided that Tenant does not commit a default
at any time prior to the expiration of the 12th & 24th calendar months following
the Effective Date, respectively, and Tenant has not assigned or subleased the
Premises, the existing Security Deposit of $68,361.86 shall be reduced to
$34,180.93 and zero, respectively. To obtain said reduction, Tenant shall remit
to Landlord an Officer’s Certificate acknowledging the requirements of this
Section 1.07 have been satisfied, whereupon Landlord shall return the reduced
portion of the Security Deposit to Tenant in immediately available funds within
thirty days of Landlord’s receipt of said Officer’s Certificate.

SECTION 1.08. Parking. Tenant shall retain its existing parting rights under the
Lease, except charges for the covered parking spaces shall be conditionally
abated through March 31, 2015. If Tenant defaults under the Lease, beyond any
applicable period of notice and cure, any remaining abatement shall cease from
the date of such default, and Tenant shall immediately pay to Landlord all sums
previously abated hereunder. After March 31, 2015, parking charges for the
covered parking spaces shall be at market rates.

SECTION 1.09. Further Amendments. The Lease shall be and hereby is further
amended wherever necessary, even though not specifically referred to herein, in
order to give effect to the terms of this Amendment. Notwithstanding anything
contained in the Lease to the contrary, if the Building is damaged as the result
of any casualty, and Landlord makes a good faith determination that restoring
the Premises would be uneconomical, or if Landlord is required to pay any
insurance proceeds arising out of the casualty to Landlord’s mortgagee, then
Landlord may terminate this Lease by giving written notice of its election to
terminate within one hundred twenty (120) days after the casualty. Section 8.3
of the Original Lease is deleted. Exhibit B attached to Original Lease is
deleted.

SECTION 1.10. Exhibits. Landlord and Tenant agree that the following exhibits
have been attached hereto and will be deemed a part of this Amendment and the
Lease for all purposes and will be in lieu of any similar rights or provisions
currently set forth in the Lease:

 

  Exhibit A –   Tenant Finish Work: Allowance   Exhibit B –   Extension Option  
Exhibit C –   Right of First Refusal/Tenant Expansion Option   Exhibit C-l –  
First Refusal Space

 

FIFTH AMENDMENT TO LEASE – Page 3 of 15

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Article II

MISCELLANEOUS

SECTION 2.01. Ratification. The Lease, as amended hereby, is hereby ratified,
confirmed and deemed in full force and effect in accordance with its terms.
Tenant represents to Landlord that: (a) Tenant is currently unaware of any
default by Landlord under the Lease; (b) Tenant has full power and authority to
execute and deliver this Agreement and this Agreement represents a valid and
binding obligation of Tenant enforceable in accordance with its terms;
(c) except as set forth on Exhibit A attached hereto, Landlord has completed all
improvements to the Premises in compliance with all requirements in the Lease;
and (d) except as set forth on Exhibit A attached hereto, all Tenant finish
costs or allowances payable by Landlord have been paid and no such costs or
allowances are payable hereafter under the Lease.

SECTION 2.02. Notices. All notices to be delivered to Landlord under the Lease
or otherwise with respect to the Premises shall, unless Landlord otherwise
notifies Tenant, be delivered to Landlord in accordance with the Lease at the
following addresses:

 

Notification

        

Address:

   Thompson National Properties, LLC          1900 Main Street, Suite 700      
   Irvine, California 92614               

With Copy To:

   Thompson National Properties, LLC         

3030 LBJ Freeway, Suite 150

Dallas, Texas 75234

              

Contact:

   Rebecca Tatsch, Property Manager      

All notices to be delivered to Tenant under the Lease or otherwise with respect
to the Premises shall be delivered at the following address:

 

Notification

        

Address:

   Affirmative Insurance Holdings, Inc.          4450 Sojourn Drive, Suite 500
         Addison, Texas 75001               

Contact:

   General Counsel      

SECTION 2.03. Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Texas.

 

FIFTH AMENDMENT TO LEASE – Page 4 of 15

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SECTION 2.04. Counterparts. This Agreement may be executed in multiple
counterparts each of which is deemed an original but together constitute one and
the same instrument. This Agreement may be executed by facsimile and each party
has the right to rely upon a facsimile counterpart of this Agreement signed by
the other party to the same extent as if such party had received an original
counterpart.

SECTION 2.05. OFAC. Neither Tenant nor any of its affiliates, nor any of their
respective partners, members, shareholders or other equity owners, and none of
their respective employees, officers, directors, representatives or agents, 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 on OFAC’s Specially
Designated and Blocked Persons List) or under any statute, executive order
(including the September 24, 2001, Executive Order Blocking Property and
Prohibiting Transactions with Persons Who Commit, Threaten to Commit, or Support
Terrorism), or other governmental action.

SECTION 2.06. INTENTIONALLY DELETED.

SECTION 2.07. INTENTIONALLY DELETED.

SECTION 2.08. Deceptive Trade Practices. Landlord and Tenant waive their rights
under the Deceptive Trade Practices-Consumer Protection Act, Section 17.41 et.
seq., Business & Commerce Code, a law that gives consumers special rights and
protections. Each, after consultation with an attorney of its selection,
voluntarily consents to this waiver.

SECTION 2.09. Calculation. Landlord and Tenant are knowledgeable and experienced
in commercial transactions and agree that the provisions set forth in this Lease
for determining charges, amounts and additional rent payable by Tenant are
commercially reasonable and valid even though such methods may not state a
precise mathematical formula for determining such charges.

SECTION 2.10 Conflict. In the event of a conflict between the terms of this
Amendment and the Original Lease or any prior amendment thereto, the terms of
this Amendment shall control, followed in order of priority by the Fourth
Amended Lease, the Third Amended Lease, the Second Amended Lease, the First
Amended Lease and then the Original Lease.

 

FIFTH AMENDMENT TO LEASE – Page 5 of 15

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IN WITNESS WHEREOF, this Amendment has been executed effective as of the date
and year first above written.

 

LANDLORD:

 

TNPPM Lakeview Sojourn, LLC, a Delaware limited liability company (“Landlord”)
acting by and through TNP Property Manager, LLC (“Agent” for Landlord)

  By:  

    TNP Property Manager, LLC

    a Delaware limited liability company

 

Its:

      as Agent for Landlord

 

        By:  

    Thompson National Properties, LLC

    a Delaware limited liability company

        Its:       Sole Member

 

   

    By:

 

/s/    Tony Thompson

   

    Title:

 

President & CEO

   

    Date:

 

11/23/09

 

TENANT:

 

Affirmative Property Holdings, Inc.,

a Texas corporation

By:   /s/    Michael J. McClure

Name:

 

Michael J. McClure

Title:

 

Executive Vice President &

 

Chief Financial Officer

 

FIFTH AMENDMENT TO LEASE – Page 6 of 15

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EXHIBIT A

TENANT FINISH-WORK: ALLOWANCE

1. Except as set forth on this Exhibit, Tenant accepts the Premises “AS-IS” and
acknowledges that Landlord has no obligation to make or otherwise pay for any
improvements, alterations or repairs thereto.

2. Tenant will prepare space plans prepared by Tenant’s architect. Landlord
shall have ten (10) days to provide comments and/or approve the space plans.
Upon approval, Tenant will obtain Working Drawings. Landlord shall provide an
allowance of up to $1.50 per rentable square foot in the Premises (the “Working
Drawings Allowance”) to be applied to expenses related to the preparation of the
space plans and Work Drawings and, in addition, any remaining amount may be
applied to costs of the Work. Tenant shall select the architect, subject to
Landlord’s prior written approval, not to be unreasonably withheld or delayed.
Payment of the Working Drawing Allowance shall be made to Tenant at the same
time Tenant requests payment for the final one-half of the Construction
Allowance provided Tenant has remitted to Landlord the Tenant Submittals. Any
unused portion of the Working Drawings Allowance remaining as of September 15,
2010 shall be forfeited by Tenant and remain Landlord’s property. As used
herein, “Working Drawings” shall mean the final working drawings approved by
Landlord, as amended from time to time by any approved changes thereto, and
“Work” shall mean all improvements to be constructed in accordance with and as
indicated on the Working Drawings. Approval by Landlord of the Working Drawings
shall not be a representation or warranty of Landlord that such drawings are
adequate for any use, purpose, or condition, or that such drawings comply with
any applicable law or code, but shall merely be the consent of Landlord to the
performance of the Work. Tenant shall, at Landlord’s request, sign the Working
Drawings to evidence its review and approval thereof. All changes in the Work
must receive the prior written approval of Landlord, and in the event of any
such approved change Tenant shall, upon completion of the Work, furnish Landlord
with an accurate, reproducible “as-built” plan (e.g., sepia) of the improvements
as constructed, which plan shall be incorporated into this Lease by this
reference for all purposes.

3. The Work shall be performed only by contractors and subcontractors acceptable
and approved by Landlord in writing. All contractors and subcontractors shall be
required to procure and maintain (a) insurance against such risks, in such
amounts, and with such companies as Landlord may reasonably require; and
(b) payment and performance bonds covering the cost of the Work and otherwise
reasonably satisfactory to Landlord. Certificates of such insurance, with paid
receipts therefor, and copies of such bonds must be received by Landlord before
the Work is commenced. The Work shall be performed in a good and workmanlike
manner that is free of defects and is in strict conformance with the Working
Drawings, and shall be performed in such a manner and at such times as to
maintain harmonious labor relations and not to interfere with or delay
Landlord’s other contractors, the operation of the Project, and the occupancy
thereof by other tenants. All contractors and subcontractors shall contact
Landlord and schedule time periods during which they may use Project facilities
in connection with the Work (e.g., loading docks, excess electricity, etc.).

 

FIFTH AMENDMENT TO LEASE – Page 7 of 15

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4. Tenant shall bear the entire cost of performing the Work (including, without
limitation, design of the Work and preparation of the Working Drawings, costs of
construction labor and materials, electrical usage during construction,
additional janitorial services, general tenant signage, related taxes and
insurance costs, all of which costs are herein collectively called the “Total
Construction Costs”).

5. Provided Tenant is not in default under the Lease, in addition to the Working
Drawings Allowance, Landlord shall provide to Tenant a Construction Allowance in
the amount up to $10.00 per rentable square foot in the Premises, one-half of
which shall be applied as a credit against Tenant’s Base Rental and the other
one-half of which shall be reimbursed by Landlord to Tenant, all subject to the
terms and conditions of this Exhibit A (“Construction Allowance”). Tenant shall
be required to fund, at its cost, the first one-half of the Construction
Allowance (“Tenant Funds”). The Construction Allowance shall be used only for
hard costs including, without limitation, installation of a back-up generator.
In consideration of Tenant’s advancement of the entire Tenant Funds and provided
that Tenant is not in default under the Lease, as of the later to occur of:
(a) the date Tenant advances the entire Tenant Funds and delivers to Landlord
the Tenant Submittals or (b) August 1, 2010. Tenant shall be entitled to a
monthly Base Rental credit in the amount of $6,103 for a period of 56 months
commencing August 1, 2010 and extending through March 31, 2015. The final
one-half of the Construction Allowance shall be reimbursed in cash to Tenant by
Landlord within sixty (60) days after Tenant has advanced the entire
Construction Allowance and delivered to Landlord all of the Tenant Submittals.

In connection with the Work and as a condition precedent to any cash
reimbursement and/or Base Rental credit Tenant shall submit Landlord the
following collectively (“Tenant Submittals”): (a) Tenant has substantially
completed the Work (a certificate from the Architect) and obtained a certificate
of occupancy, (b) photocopies of paid invoices evidencing that the amount being
requested has been paid by Tenant in connection with the Work, including without
limitation, invoices from the architect, (c) Final Lien Waivers upon substantial
completion of the Work in recordable form, fully executed and acknowledged by
Tenant’s general contractor and the subcontractors, suppliers and materialmen,
indicating that upon the payment to the general contractor and the
subcontractors, suppliers and materialmen of the amount set forth in such lien
waiver, the general contractor and the subcontractors, suppliers and materialmen
waives and releases any and all liens or claims of liens they have owing to such
party for all Work completed, and (d) a certificate from Tenant’s general
contractor that all subcontractors have been paid in full for all Work
completed. Tenant shall be responsible and liable for timely paying all bills
associated with the Work and agrees to indemnify and hold Landlord harmless
(including reasonable attorneys’ fees) from any claims related to the Work and
will cause the removal of any lien recorded against the Building and/or the land
upon which the Building is situated within ten (10) days following any such
claim. If Tenant fails to claim the Construction Allowance and/or fails to
otherwise comply with the requirements of this section (including without
limitation, Tenant’s failure to advance the Tenant Funds and/or provide the
Tenant Submittals for either the Tenant Funds and/or Construction Allowance) on
or before September 15, 2010, Tenant shall not be entitled to any rent credit or
cash reimbursement with respect to such Submittals, and that portion of the
Construction Allowance relating thereto shall be deemed forfeited and remain
Landlord’s property.

 

FIFTH AMENDMENT TO LEASE – Page 8 of 15

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6. To the extent not inconsistent with this Exhibit or the Addendum, the Lease
shall govern the performance of the Work and the Landlord’s and Tenant’s
respective rights and obligations regarding the improvements installed pursuant
thereto.

 

FIFTH AMENDMENT TO LEASE – Page 9 of 15

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EXHIBIT B

EXTENSION OPTION

1. Provided that: (i) no default exists at the time of such election, and
(ii) Tenant is occupying the entire Premises at the time of such election,
Tenant shall be permitted to renew this Lease for two (2) additional consecutive
periods of five (5) years each on the same terms provided in this Lease (except
as set forth below), by delivering written notice of (“Tenant’s Notice”) the
exercise thereof to Landlord not later than six (6) months prior to the end of
the Term described in the Amendment and with regard to the second option, six
(6) months prior to the expiration as of the first five (5) year option. On or
before the commencement date of the applicable extended Term, Landlord and
Tenant shall execute an amendment to this Lease extending the Term on the same
terms provided in the Lease and this Addendum, except as follows:

(a) The Base Rent payable for each month during each such extended Term shall be
the prevailing market rental rate for buildings comparable to the Building, at
the commencement of such extended Term, for space of equivalent class, quality,
size and utility in the far North Dallas/Addison submarkets (“Comparable
Buildings”), with the length of the extended Term and the credit standing of
Tenant to be taken into account, and with respect to the first five (5) year
option, the Base Year shall be adjusted at the end of the Term described in the
Amendment to be the calendar year in which the renewal commences;

(b) Tenant shall have no further renewal options unless expressly granted by
Landlord in writing;

(c) any market concessions granted to renewing tenant’s in Comparable Buildings;
and

(d) any market lease form changes reasonably requested by Landlord.

2. Within thirty (30) days following delivery of Tenant’s Notice, Landlord shall
deliver to Tenant a written notice (“Landlord’s Notice”) specifying the Base
Rental rate per rentable square foot per annum for the applicable additional
term. Tenant shall have ten (10) days following delivery of Landlord’s Notice to
notify Landlord in writing (“Tenant’s Renewal Notice”) of (i) Tenant’s exercise
of its right to renew the Lease at the Base Rental rate proposed by Landlord, or
(ii) Tenant’s election not to exercise its right to renew the Lease. If Tenant
fails to timely deliver Tenant’s Renewal Notice, such failure shall not be
deemed acceptance by Tenant of the Base Rental rate proposed by Landlord, but
Tenant shall be deemed to be a waiver of Tenant’s right to an extended Term of
the Lease and the Term.

3. Tenant’s rights under this Exhibit shall terminate if (i) this Lease or
Tenant’s right to possession of the Premises is terminated, (ii) Tenant assigns
any of its interest in this Lease or sublets any portion of the Premises to a
party other than a Related Entity, or (iii) Tenant fails to timely exercise its
option under this Exhibit, time being of the essence with respect to Tenant’s
exercise thereof. Notwithstanding Subsection 3(ii) of the foregoing. Tenant’s
rights under this Exhibit shall not terminate in the event that Tenant assigns
the Lease (as then amended) to any of Tenant’s parent, subsidiary or affiliated
companies (“Related Entity”).

 

FIFTH AMENDMENT TO LEASE – Page 10 of 15

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EXHIBIT C

RIGHT OF FIRST REFUSAL/TENANT EXPANSION OPTION

Right of First Refusal

Subject to the terms and conditions set forth in this Exhibit C, from the date
hereof through the Term described in the Amendment, and provided this Lease is
then in full force and effect and that no uncured default then exists under this
Lease, either at the time of Tenant’s election to lease the First Refusal Space
or as of the commencement of this Lease as it relates to the First Refusal
Space. Tenant shall have the right of first refusal (the “Right of First
Refusal”) to lease Suite 100, 150, 200 or 300 at 4450 Sojourn Drive, Addison,
Texas, as shown on Schedule C-l (the “First Refusal Space”), in its then as is
condition, on the following terms and conditions:

(a) Should Landlord receive any offer with respect to all or any portion of the
First Refusal Space from a bona fide third party prospect (the “Prospect”) which
Landlord is willing to accept, Landlord shall notify Tenant thereof in writing.

(b) Tenant shall have seven (7) days after receipt of Landlord’s notice to
respond as to whether or not Tenant desires to lease all of the applicable First
Refusal Space. Tenant shall be required to lease all of the First Refusal Space
proposed by the Prospect. If Tenant elects not to lease the First Refusal Space,
fails to respond within such seven (7) day period and/or fails to return the
Amendment as required in this Exhibit C, then Landlord shall be free to lease
the First Refusal Space and any additional space to the Prospect or any other
party on such terms and conditions as Landlord deems appropriate, in Landlord’s
sole discretion, and this Right of First Refusal described in this Exhibit C
shall automatically terminate; provided, however, if Landlord fails to lease the
applicable First Refusal Space within six (6) months following Tenant’s waiver
or deemed waiver of its right, then if Tenant’s rights have not previously
terminated hereunder. Tenant’s rights hereunder shall begin anew, all subject to
the terms and conditions set forth in this Exhibit C.

(c) If Tenant elects to lease the First Refusal Space, the “Base Rental” and
allowance for the First Refusal Space for purposes of the Lease, shall be as
follows:

(1) if the ROFR Effective Date occurs on or before May 31, 2011, then Base
Rental and other amounts shall be the same as those then applicable to the
Premises described in the Fifth Amendment to Lease and shall go into effect at
the same rate then applicable to the Premises described in the Fifth Amendment
to Lease and increase at the same time and in the same manner as the rates for
the Premises described in the Fifth Amendment to Lease. Tenant shall be entitled
to $0.14 per rentable square foot in the First Refusal Space multiplied by the
number of months in the Term remaining between the period commencing on the ROFR
Effective Date and March 31, 2015 and, at Landlord’s election, said construction
allowance shall be payable on the same terms as described in Exhibit A (i.e.
Tenant shall advance one-half of the amount and be entitled to a credit over the
remaining months then in the Term following the ROFR Effective Date amortized at
a rate of return of eight percent (8%) per annum) and after Tenant has advanced
said amounts, Landlord will reimburse Tenant the other one-half of said
allowance (any portion of the Construction Allowance remaining as of sixty
(60) days following the ROFR Effective Date shall be forfeited by Tenant, or

 

FIFTH AMENDMENT TO LEASE – Page 11 of 15

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(2) if the ROFR Effective Date occurs on or after June 1, 2011, the Base Rental
shall be the greater of: (i) the Base Rental set forth in the terms proposed by
the Prospect or (ii) an amount equal to the prevailing market rental rate (plus
any concessions) on the date of exercise, for buildings of equivalent class,
quality, size and utility to that of the Building in the far North
Dallas/Addison submarkets.

The “term” of the Lease as to the First Refusal Space shall be the longer of:
(A) coterminous with Tenant’s existing Lease Term for the Premises or (B) the
Term proposed by the Prospect. Base Rental for the First Refusal Space shall
commence on the earlier to occur of (the “ROFR Effective Date”) (i) ninety
(90) days after Tenant accepts the offer or (ii) substantial completion of the
improvements. In addition, if Landlord is reasonably concerned about Tenant’s
financial condition, Tenant shall deposit with Landlord an additional Security
Deposit for the Term to secure its obligations under this Lease. Except as
expressly set forth to the contrary in this Lease, from and after the date
Tenant is required to pay Base Rental hereunder with respect to the First
Refusal Space, all other terms and conditions of this Lease shall apply to the
First Refusal Space and the First Refusal Space shall be deemed to be a part of
the Premises for the term described in this Section (c).

(d) Tenant’s right to lease the First Refusal Space pursuant to this Exhibit is
and shall at all times be subject and subordinate to other tenants and/or the
rights of other tenants currently in effect with respect to such space, whether
exercised or unexercised. This Right of First Refusal is personal to Tenant and
shall become null and void upon the occurrence of an assignment of this Lease or
a sublet of all or any portion of the Premises other than to a Related Entity.

(e) Promptly after Tenant’s exercise of its right of first refusal, Landlord
shall deliver to Tenant an amendment to the Lease to reflect changes in the
Premises, Base Rental, Tenant’s Proportionate Share and any other appropriate
terms changed by the addition of the space. Within fifteen (15) days thereafter,
Tenant shall execute and return the amendment. If Tenant fails to return the
amendment within such fifteen (15) day period, Tenant’s rights under this
Exhibit C shall be deemed terminated and Tenant shall have no further right to
the First Refusal Space.

 

FIFTH AMENDMENT TO LEASE – Page 12 of 15

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Expansion Option

For the period of the date of this Amendment through March 31, 2012 (the
“Expansion Term”), Tenant shall have the option (subject existing tenant’s
rights, Landlord’s determination that the space is available, i.e. Landlord does
not have a prospect for the space and Landlord’s approval of the size and
location of the space) to expand its office space in the absence of any offer to
lease any of the First Refusal Space by a Prospect with respect to any of the
First Refusal Space that becomes available through vacancy or the expiration of
another tenant’s lease (the “Expansion Option”). If Tenant exercises the
Expansion Option at any time up to six (6) months prior to the expiration of the
Expansion Term, then Base Rental and other amounts shall be the same as those
then applicable to the Premises described in the Fifth Amendment to Lease and
shall go into effect at the same rate then applicable to the Premises described
in the Fifth Amendment to Lease and increase at the same time and in the same
manner as the rates for the Premises described in the Fifth Amendment to Lease.
Tenant shall be entitled to a construction allowance of up to $0.14 per rentable
square foot in the First Refusal Space that is the subject of the Tenant
Expansion Option (the “Expansion Space”), multiplied by the number of months in
the Term remaining between the period commencing on the Expansion Effective
Date, and, at Landlord’s election, said construction allowance shall be payable
on the same terms as described in Exhibit A (i.e. Tenant shall advance one-half
of the amount and be entitled to a credit over the remaining months then in the
Term following the Expansion Effective Date (as hereinafter defined) amortized
at a rate of return of eight percent (8%) per annum), and after Tenant has
advanced said amounts, Landlord will reimburse Tenant the other one-half of said
allowance. Any portion of the allowance remaining sixty (60) days after the
Expansion Effective Date shall be forfeited by Tenant.

Suite 100 (approximately 13,125 square feet) can be delivered on the later of:
December 1, 2009 or when Suite 100 is vacated; (b) Suites 150 and 200 (an
aggregate of approximately 10,833 square feet) can be available immediately or
upon execution of a Lease extension, subject to any offers from other Prospects
or third parties; or (c) Suite 300 (approximately 11,500 square feet) can be
delivered on the later date of: (a) July 31, 2011 (subject to any extension
options) or when Suite 300 is vacated. The total amount of contiguous space
adjacent to Tenant is approximately 35,458 square feet.

The “term” of the Lease as to any Expansion Space shall be coterminous with
Tenant’s existing Lease Term for the Premises. Base Rental for the Expansion
Space shall commence upon the earlier to occur of (the “Expansion Effective
Date”): (i) ninety (90) days after Tenant exercises its Tenant Expansion Option
or (ii) substantial completion of Tenant’s improvements to the Expansion Space.
Except as expressly set forth to the contrary in this Fifth Amendment to Lease,
from and after the date Tenant is required to pay Base Rental hereunder with
respect to any Expansion Space, all other terms and conditions of this Lease
shall apply to the Expansion Space, and the Expansion Space shall be deemed to
be a part of the Premises for remainder of the term described in this Section.

Tenant shall provide Landlord with six (6) months advance written notice of its
exercise of any Expansion Option hereunder. This Expansion Option shall lapse
and expire if Tenant fails to exercise the Expansion Option on or before
September 30, 2011.

 

FIFTH AMENDMENT TO LEASE – Page 13 of 15

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Tenant’s right to lease the Expansion Space pursuant to this Exhibit is and
shall at all times be subject and subordinate to other tenants, prospects and/or
the rights of other tenants currently in effect with respect to such space,
whether exercised or unexcrcised. This Right of First Refusal is personal to
Tenant and shall become null and void upon the occurrence of an assignment of
this Lease or a sublet of all or any portion of the Premises, other than to a
Related Entity. This Expansion Option shall not apply if at the time of Tenant’s
exercise Landlord has a prospect interested in the Expansion Space requested by
Tenant.

Promptly after Tenant’s exercise of the Expansion Option, Landlord shall deliver
to Tenant an amendment to the Lease to reflect changes in the Premises, Base
Rental, Tenant’s Proportionate Share and any other appropriate terms changed by
the addition of the space. Within fifteen (15) days thereafter, Tenant shall
execute and return the amendment. If Tenant fails to return the amendment within
such fifteen (15) day period, Tenant’s rights under this Exhibit C shall be
deemed terminated and Tenant shall have no further right to the Expansion Space.

 

FIFTH AMENDMENT TO LEASE – Page 14 of 15

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SCHEDULE C-l

FIRST REFUSAL SPACE

See attached site plan for 4450 Sojourn Drive, Addison, Texas 75001

 

FIFTH AMENDMENT TO LEASE – Page 15 of 15

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