COMMERCIAL LEASE AGREEMENT

(Arkansas)

[// GUIDANCE: This template is intentionally comprehensive. Delete any provisions that are unnecessary for the contemplated transaction and tailor bracketed placeholders before circulation.]

TABLE OF CONTENTS

1. Document Header ................................................. 2
2. Definitions ..................................................... 3
3. Operative Provisions ............................................ 7
4. Representations & Warranties .................................... 12
5. Covenants & Restrictions ........................................ 13
6. Default & Remedies .............................................. 16
7. Risk Allocation ................................................. 19
8. Dispute Resolution .............................................. 22
9. General Provisions .............................................. 24
10. Execution Block ................................................. 27

Page numbers are illustrative only.

1. DOCUMENT HEADER

1.1 Parties

This Commercial Lease Agreement (this “Lease”) is made and entered into as of [EFFECTIVE DATE] (the “Effective Date”) by and between:

(a) [LANDLORD LEGAL NAME], a [STATE OF ORGANIZATION] [ENTITY TYPE], having a principal place of business at [ADDRESS] (“Landlord”); and

(b) [TENANT LEGAL NAME], a [STATE OF ORGANIZATION] [ENTITY TYPE], having a principal place of business at [ADDRESS] (“Tenant”).

Landlord and Tenant are each a “Party” and collectively the “Parties.”

1.2 Recitals

A. Landlord is the fee-simple owner of certain real property located at [PROPERTY ADDRESS], together with all improvements commonly known as “[BUILDING NAME]” (collectively, the “Property”).
B. Tenant desires to lease a portion of the Property, and Landlord desires to lease the same to Tenant, on the terms and conditions set forth herein.
C. The Parties enter into this Lease for good and valuable consideration, the receipt and sufficiency of which are acknowledged.

1.3 Governing Law & Jurisdiction

This Lease shall be governed by and construed in accordance with the real estate laws of the State of Arkansas (the “Governing Law”), without regard to conflicts-of-law principles. Subject to Section 8 (Dispute Resolution), each Party hereby irrevocably submits to the exclusive jurisdiction of the state courts sitting in [COUNTY], Arkansas (the “Selected Forum”).

2. DEFINITIONS

Capitalized terms used but not otherwise defined herein have the following meanings. All cross-references are to sections of this Lease unless otherwise noted.

“Additional Rent” – Any monetary obligation of Tenant under this Lease other than Base Rent, including but not limited to Operating Expenses, Taxes, late charges, and indemnity payments.

“Affiliate” – With respect to a Person, any other Person that directly or indirectly controls, is controlled by, or is under common control with such Person.

“Applicable Environmental Laws” – All federal, state, and local statutes, regulations, ordinances, and common-law duties relating to environmental protection, hazardous substances, or industrial hygiene, including without limitation the Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C. §§ 9601 et seq.) and the Arkansas Hazardous Waste Management Act (Ark. Code Ann. § 8-7-202 et seq.).

“Base Rent” – The fixed monthly rent payable by Tenant pursuant to Section 3.3, subject to adjustment as provided herein.

“Building” – The structure located on the Property commonly known as “[BUILDING NAME],” together with Common Areas.

“Business Day” – Any day other than Saturday, Sunday, or a day on which Arkansas state banks are authorized or required to close.

“Commencement Date” – [COMMENCEMENT DATE OR FORMULA // GUIDANCE: Generally the earlier of substantial completion or first business use].

“Common Areas” – All areas and facilities outside the Premises that are provided and designated by Landlord for the general non-exclusive use of Tenant and other occupants of the Building.

“Event of Default” – Any of the occurrences described in Section 6.1.

“Hazardous Material” – Any substance, material, or waste regulated or classified under Applicable Environmental Laws, including petroleum products.

“Indemnified Parties” – Landlord, Landlord’s Affiliates, and their respective managers, directors, officers, shareholders, partners, members, employees, agents, and representatives.

“Landlord Work” – The improvements, if any, that Landlord is obligated to construct in or to the Premises as described in Exhibit B (if any).

“Lease Term” – The period commencing on the Commencement Date and ending on the Expiration Date, as the same may be extended or earlier terminated.

“Operating Expenses” – All costs and expenses incurred by Landlord in owning, operating, maintaining, repairing, and managing the Property, as more fully described in Section 3.5.

“Permitted Use” – [SPECIFY BUSINESS USE], and no other use without Landlord’s prior written consent.

“Premises” – The rentable area known as Suite [] containing approximately [] rentable square feet located on the [FLOOR] floor of the Building, as outlined on Exhibit A.

“Rent” – Collectively, Base Rent and Additional Rent.

“Security Deposit” – The amount set forth in Section 3.8.

3. OPERATIVE PROVISIONS

3.1 Lease of Premises

Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord, the Premises for the Lease Term, together with the non-exclusive right to use the Common Areas subject to this Lease.

3.2 Lease Term

(a) Commencement Date. The Lease Term shall commence on the Commencement Date.
(b) Expiration. The Lease Term shall expire at 11:59 p.m. local time on [EXPIRATION DATE], unless extended or earlier terminated pursuant to this Lease.

[// GUIDANCE: Insert renewal options or expansion rights in a separate subsection if desired.]

3.3 Base Rent

Tenant shall pay to Landlord Base Rent in the amount of [BASE RENT AMOUNT] per month, in advance, on or before the first (1st) day of each calendar month during the Lease Term. If the Commencement Date is not the first day of a month, Base Rent for the partial month shall be prorated on a per-diem basis.

3.4 Additional Rent

Tenant shall pay as Additional Rent all amounts designated as such in this Lease, each within ten (10) days after receipt of Landlord’s invoice or at such other times as expressly stated.

3.5 Operating Expenses and Taxes

(a) Allocation. Tenant shall pay Tenant’s Pro Rata Share of Operating Expenses and real estate Taxes. Tenant’s Pro Rata Share equals the ratio of the rentable square footage of the Premises to the rentable square footage of the Building.
(b) Estimates & Reconciliation. Landlord shall provide annual estimates and reconciliations; under-payments shall be due within thirty (30) days, and over-payments shall be credited or refunded.

3.6 Utilities

Tenant shall timely pay all charges for utilities and services furnished to or used in the Premises and shall install submeters if reasonably required by Landlord.

3.7 Use and Compliance

Tenant shall use the Premises solely for the Permitted Use and shall not:
(i) create any nuisance or unreasonable interference;
(ii) violate any Applicable Environmental Laws; or
(iii) overload building systems.

3.8 Security Deposit

Upon execution of this Lease, Tenant shall deliver to Landlord the Security Deposit in the amount of [SECURITY DEPOSIT AMOUNT] as security for Tenant’s performance. The Security Deposit is not an advance Rent and may be applied by Landlord to cure any Default.

3.9 Condition of Premises; Landlord Work

(a) Delivery “AS-IS.” Except for Landlord Work (if any), Tenant accepts the Premises in “AS-IS” condition.
(b) Punch-List. Within five (5) Business Days after delivery, Tenant may provide a punch-list of incomplete Landlord Work.

3.10 Maintenance & Repairs

(a) Tenant’s Obligations. Tenant shall, at its sole cost, keep the interior, non-structural portions of the Premises in good order, condition, and repair.
(b) Landlord’s Obligations. Landlord shall repair and maintain the structural and Common Area components, the cost of which shall be included in Operating Expenses except as limited by Section 7.4 (Liability Cap).

3.11 Alterations

Tenant shall not make any alterations, improvements, or additions in or to the Premises without Landlord’s prior written consent, which consent shall not be unreasonably withheld, conditioned, or delayed with respect to non-structural alterations costing less than [$___].

3.12 Assignment & Subletting

(a) Restriction. Tenant shall not assign this Lease or sublet all or any portion of the Premises (each a “Transfer”) without Landlord’s prior written consent, which shall not be unreasonably withheld provided:
(i) the proposed transferee has comparable financial strength;
(ii) use remains the Permitted Use; and
(iii) the Transfer complies with Ark. Code Ann. § 18-17-701 (to the extent applicable to commercial leases).
(b) Recapture. Landlord may, within fifteen (15) days after receipt of a Transfer request, elect to recapture the affected space.
(c) Transfer Premium. Tenant shall pay Landlord fifty percent (50%) of any excess rent or consideration received in connection with a Transfer, after deducting reasonable brokerage commissions and legal fees.

3.13 Insurance

Tenant shall maintain throughout the Lease Term:
(i) commercial general liability insurance with limits of not less than $[] per occurrence/$[] aggregate, naming Landlord and any Mortgagee as additional insureds;
(ii) property insurance on a “special form” basis covering Tenant’s personal property and trade fixtures at full replacement cost; and
(iii) workers’ compensation insurance in statutory limits.

4. REPRESENTATIONS & WARRANTIES

4.1 By Landlord

(a) Authority. Landlord is duly organized, validly existing, and in good standing, and has full authority to execute this Lease.
(b) Title. Landlord holds good and marketable fee title to the Property, free of any superior leases affecting the Premises except those disclosed on Exhibit C.

4.2 By Tenant

(a) Organization. Tenant is duly organized, validly existing, and in good standing.
(b) Authority. Tenant has taken all requisite action to authorize execution of this Lease.
(c) OFAC. Tenant is not a Person with whom Landlord is legally prohibited from doing business.

4.3 Survival

All representations and warranties shall survive the execution and delivery of this Lease, but shall not survive beyond the Expiration Date except with respect to latent environmental liabilities.

5. COVENANTS & RESTRICTIONS

5.1 Affirmative Covenants

Tenant shall:
(i) comply with all applicable laws, ordinances, and regulations;
(ii) keep the Premises free of liens;
(iii) cooperate with Landlord in any conservation or sustainability programs; and
(iv) promptly give Landlord written notice of any condition that might give rise to a claim against the Indemnified Parties.

5.2 Negative Covenants

Tenant shall not:
(i) use or permit the Premises to be used for any immoral, illegal, or extra-hazardous purpose;
(ii) place any exterior signage without Landlord’s approval; or
(iii) store or handle Hazardous Materials except for reasonable quantities ordinarily used in the Permitted Use and in compliance with Applicable Environmental Laws.

5.3 Environmental Compliance

(a) Tenant Obligations. Tenant shall, at its sole cost, comply with Applicable Environmental Laws and obtain all permits required for the Permitted Use.
(b) Testing. Landlord may enter and conduct environmental testing upon reasonable notice.
(c) Remediation. Tenant shall remediate any release of Hazardous Materials caused by Tenant, its employees, agents, or contractors, in accordance with Applicable Environmental Laws and to Landlord’s reasonable satisfaction.

5.4 Estoppel Certificates

Within ten (10) Business Days after request, Tenant shall execute and deliver an estoppel certificate in the form reasonably requested by Landlord or any Mortgagee.

6. DEFAULT & REMEDIES

6.1 Events of Default

Each of the following constitutes an “Event of Default”:
(a) Monetary Default. Failure by Tenant to pay any Rent within five (5) days after written notice; provided, Landlord shall not be required to provide notice more than twice in any twelve-month period.
(b) Non-Monetary Default. Failure by Tenant to perform any non-monetary obligation within thirty (30) days after written notice, except that if such default cannot reasonably be cured within thirty (30) days, Tenant shall not be in Default if it commences cure within such period and diligently prosecutes the same to completion.
(c) Insolvency Events. Filing of a voluntary or involuntary petition in bankruptcy or assignment for the benefit of creditors not dismissed within sixty (60) days.

6.2 Landlord’s Remedies

Upon an Event of Default, Landlord may, subject to Ark. Code Ann. §§ 18-60-301 et seq.:
(i) declare the Lease terminated and recover possession;
(ii) accelerate all Rent due for the balance of the Lease Term, discounted at 5% per annum to present value;
(iii) re-enter and repossess the Premises through summary detainer;
(iv) relet the Premises and recover any deficiency; and
(v) exercise self-help to perform Tenant’s obligations and charge all costs to Tenant.

[// GUIDANCE: Arkansas law allows commercial landlords to use forcible entry and detainer proceedings. Residential-specific statutes in § 18-17 do not govern commercial property.]

6.3 Landlord’s Lien

In addition to statutory liens, Tenant grants Landlord a continuing security interest in all personal property located in the Premises as security for Rent, enforceable under Article 9 of the Uniform Commercial Code.

6.4 Attorneys’ Fees

The prevailing Party in any action or proceeding arising out of this Lease shall be entitled to recover reasonable attorneys’ fees and costs.

7. RISK ALLOCATION

7.1 Indemnification (Tenant Use Indemnity)

Tenant shall indemnify, defend, and hold harmless the Indemnified Parties from and against any and all claims, damages, liabilities, losses, costs, and expenses (including reasonable attorneys’ fees) arising from:
(a) Tenant’s use or occupancy of the Premises;
(b) any act or omission of Tenant or Tenant’s agents, employees, or invitees; or
(c) any breach of this Lease by Tenant,
except to the extent caused by the gross negligence or willful misconduct of Landlord.

7.2 Indemnity Procedures

Indemnification is subject to the following:
(i) prompt written notice of any claim;
(ii) the right of the indemnifying Party to control the defense; and
(iii) cooperation by the indemnified Party.

7.3 Limitation of Liability

Except for (i) Tenant’s indemnification obligations, (ii) liability for fraud or willful misconduct, and (iii) obligations that expressly survive termination, the liability of either Party under this Lease shall not exceed [CAP AMOUNT OR “NO CAP”] in the aggregate.

[// GUIDANCE: Insert “$____” or strike if no cap is negotiated.]

7.4 Waiver of Consequential Damages

Neither Party shall be liable for consequential, incidental, or punitive damages arising out of this Lease, except for damages arising from holdover, hazardous material releases, or breaches of confidentiality.

7.5 Insurance Proceeds & Subrogation

All property insurance policies maintained by either Party shall provide for waiver of subrogation. Each Party hereby waives, releases, and discharges the other from all claims covered by such insurance.

7.6 Force Majeure

Neither Party shall be liable for failure to perform any obligation (other than payment of Rent) due to strikes, acts of God, governmental restrictions, or any cause beyond its reasonable control, provided that the affected Party gives written notice within ten (10) days after commencement of the force majeure event.

8. DISPUTE RESOLUTION

8.1 Negotiation Period

The Parties shall first attempt in good faith to resolve any dispute through negotiation, with executives to meet within ten (10) Business Days after a written demand.

8.2 Arbitration (Optional)

[SELECT ONE]
☐ Arbitration Omitted. Disputes shall be resolved exclusively in the Selected Forum.
☐ Arbitration Elected. Any dispute not resolved within thirty (30) days after the negotiation period shall be finally settled by arbitration administered by the American Arbitration Association (“AAA”) under its Commercial Arbitration Rules then in effect. The seat of arbitration shall be [CITY], Arkansas. Judgment on the award may be entered in any court of competent jurisdiction.

8.3 Jury Waiver (Optional)

[SELECT ONE]
☐ Each Party hereby waives, to the fullest extent permitted by law, any right to trial by jury.
☐ Jury waiver omitted.

8.4 Injunctive Relief

Nothing in this Section 8 shall limit either Party’s right to seek provisional or eviction-related injunctive relief, including but not limited to writs of possession or detainer under Ark. Code Ann. §§ 18-60-301 et seq., from any court of competent jurisdiction.

9. GENERAL PROVISIONS

9.1 Amendments; Waivers

No amendment or waiver of any provision of this Lease shall be effective unless in writing and signed by both Parties. A waiver on one occasion shall not constitute a waiver on any subsequent occasion.

9.2 Notices

All notices shall be in writing and deemed given (i) upon receipt if delivered by hand, (ii) one (1) Business Day after deposit with a nationally recognized overnight courier, or (iii) three (3) Business Days after mailing by certified mail, return receipt requested, postage prepaid, in each case addressed to the Party’s notice address set forth below (or as updated by notice).

Landlord Notice Address: [ADDRESS]
Tenant Notice Address: [ADDRESS]

9.3 Assignment by Landlord

Landlord may transfer its interest in the Property and, upon such transfer (and assumption by the transferee), Landlord shall be released from all obligations accruing thereafter.

9.4 Successors & Assigns

This Lease shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns.

9.5 Severability

If any provision is held invalid or unenforceable, the remainder shall be construed to effectuate the Parties’ intent, and the invalid provision shall be reformed to the maximum extent permissible.

9.6 Integration

This Lease, together with any exhibits and addenda, constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior understandings.

9.7 Counterparts; Electronic Signatures

This Lease may be executed in multiple counterparts, each of which is deemed an original and all of which constitute one instrument. Signatures delivered by electronic means (e.g., PDF or DocuSign) shall be deemed original.

9.8 Confidentiality

The terms of this Lease are confidential and shall not be disclosed by either Party, except to Affiliates, lenders, prospective investors, or as required by law.

10. EXECUTION BLOCK

IN WITNESS WHEREOF, the Parties have executed this Lease as of the Effective Date.

LANDLORD:
[LANDLORD LEGAL NAME]
By: ____
Name: ____
Title: _____
Date: _________

TENANT:
[TENANT LEGAL NAME]
By: ____
Name: ____
Title: _____
Date: _________

[// GUIDANCE: Add notarization or witness lines if required by Arkansas practice or local recording office. For most commercial leases in Arkansas, notarization is not mandatory unless the document will be recorded.]

Exhibits (attach as needed)

• Exhibit A – Floor Plan of Premises
• Exhibit B – Landlord Work (if any)
• Exhibit C – Title Exceptions & Mortgagee Information
• Exhibit D – Rules and Regulations

[// GUIDANCE: Verify all cross-references after deleting or renumbering exhibits.]

END OF COMMERCIAL LEASE AGREEMENT