EXHIBIT 10.13
1. BASIC LEASE TERMS
a. DATE OF LEASE: May 12, 1998
b. TENANT: SonoSight, Inc.
Trade Name:
Address (Leased Premises): 00000 Xxxxx Xxxxx Xxxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Building/Unit: Second Floor
Address (For Notices): 19807 North Creek Parkway, Second Floor
Bothell, Washington 98011
Facsimile:
c. LANDLORD: TMT-Bothell, LLC
Address (For Notices): c/x Xxxxxxxx Real Estate Associates
000 Xxxxxxx Xxxxxx - 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Legal Coordinator
Facsimile: (000) 000-0000
WITH A COPY TO Xxxxxxx X. Xxxxx c/x Xxxxxxxxx Real Estate Associates,
000 X. Xxxxx Xxxx Xxxxx 000, Xxxx Xxxxx, Xxxxxxxxxx 00000; facsimile
(000) 000-0000.
or to such other place as Landlord may from time to time designate by
notice to Xxxxxx.
d. TENANT'S USE OF PREMISES: General administrative office and research
and development of handheld ultrasound medical devices.
e. PREMISES: The Premises are as depicted on the attached Exhibit A.
f. TERM OF LEASE: This Lease shall commence on August 1, 1998 or such
earlier or later date as is provided in Section 3 (the "Commencement
Date"), and shall terminate on the last day of the sixtieth (60th)
full calendar month after the Commencement Date (the "Expiration
Date").
g. MINIMUM MONTHLY RENT: Minimum Monthly Rent shall be as follows:
Months Minimum Monthly Rent
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01-03 Rent Abated
04-06 $17,493
07-24 $23,324
25-36 $24,338
37-54 $25,352
55-60 $26,367
h. TENANT'S SHARE (For purposes of Tenant's Share of Expenses and Real
Estate Taxes): 37.32%
i. SECURITY DEPOSIT: $76,057 (subject to reduction per Section 5)
NONREFUNDABLE CLEANING FEE:$N/A
j. BROKER(S): The Xxxxxxxxx Group, Inc. represented both Landlord and
Tenant; both parties consent to such dual representation.
k. GUARANTORS:
l. TENANT'S MAXIMUM PARKING: 80 stalls (subject to increase pursuant to
Section 30)
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m. ADDITIONAL SECTIONS:
Additional sections of this lease numbered 30 through 31 are attached
hereto and made a part hereof.
n. EXHIBITS:
The following Exhibits are attached hereto and made a part hereof.
Exhibit A - The Premises
Exhibit B - The Project (including legal description)
Exhibit C - Certificate of Commencement Date
Exhibit D - Signage
Exhibit E - Rules and Regulations
Exhibit F - Premises Completion
2. PREMISES/COMMON AREAS/PROJECT.
A. PREMISES. Landlord leases to Tenant the premises described in Section
1 and in Exhibit A (the "Premises"), located in this project described
on Exhibit B (the "Project"). By entry on the Premises, Xxxxxx
acknowledges that it has examined the Premises and accepts the
Premises in their present condition, subject to any additional work
Landlord has agreed to do.
B. COMMON AREAS. As used in this Lease, "Common Areas" shall mean all
portions of the Project not leased or demised for lease to specific
tenants. During the Lease Term, Tenant and its licensees, invitees,
customers and employees shall have the non-exclusive right to use the
public portions of the Common Areas, including all parking areas,
landscaped areas, entrances, lobbies, elevators, stairs, corridors,
and public restrooms in common with Landlord, other Project tenants
and their respective licensees, invitees, customers and employees.
Landlord shall at all times have exclusive control and management of
the Common Areas and no diminution thereof shall be deemed a
constructive or actual eviction or entitle Tenant to compensation or a
reduction or abatement of rent. Landlord in its discretion may
increase, decrease or change the number, locations and dimensions of
any Common Areas and other improvements shown on Exhibit A which are
not within the Premises.
C. PROJECT. Landlord reserves the right in its sole discretion to modify
or alter the configuration or number of buildings in the Project,
provided only that such modification or alteration will not materially
adversely affect Tenant's use of the Premises.
3. TERM. The Commencement Date listed in Section 1 of this Lease represents an
estimate of the Commencement Date. This Lease shall commence on the
estimated Commencement Date if the Premises Improvement Work (as defined in
Exhibit F) is substantially completed (as that term is used in the
construction industry) at least two (2) weeks prior to such date, or if
Tenant commences beneficial occupancy prior to that date, then on the date
Tenant commences beneficial occupancy. Otherwise the Commencement Date
shall be on that later date that is the first to occur of the following
events (i) two (2) weeks after the date on which Landlord notifies Tenant
that the Premises Improvement Work is substantially complete, (ii) the date
on which Xxxxxx takes possession or commences beneficial occupancy of the
Premises, or (iii) if substantial completion of the Premises Improvement
Work is delayed due to Tenant's failure to perform its obligations under
this Lease, then the date reasonably determined by Landlord as two (2)
weeks after the date upon which the Premises Improvement Work would have
been substantially completed, but for Tenant's failure to perform. If this
Commencement Date is later than the Section 1 Commencement Date, this Lease
shall not be void or voidable, nor shall Landlord be liable to Tenant for
any loss or damage resulting therefrom. Landlord shall confirm the
Commencement Date by written notice to Tenant in the form attached hereto
as Exhibit C. This Lease shall be for a term ("Lease Term") beginning on
the Commencement Date and ending on the Expiration Date, unless extended or
sooner terminated in accordance with the terms of this Lease. All
provisions of this Lease, other than those relating to payment of Minimum
Monthly Rent and Additional Rent, shall become effective upon the date that
Tenant or its officers, agents,
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employees or contractors is first present on the Premises for construction,
installation or move-in-purposes.
4. RENT
A. MINIMUM MONTHLY RENT. Tenant shall pay Landlord minimum monthly rent
in the initial amount in Section 1 which shall be payable monthly in
advance on the first day of each and every calendar month ("Minimum
Monthly Rent") provided, however, the first month's Minimum Monthly
Rent and Xxxxxx's Share of Expenses and Real Estate Taxes is due and
payable upon execution of this Lease. If the term of this Lease
contains any rental abatement period, Tenant hereby agrees that if
Tenant breaches the Lease and fails to cure such breach within the
applicable cure period, if any, and/or abandons the Premises before
the end of the Lease term, or if Tenant's right to possession is
terminated by Landlord because of Tenant's breach of the Lease, the
rental abatement period shall be deemed extinguished, and there shall
be immediately due from Tenant to Landlord, in addition to any damages
otherwise due Landlord under the terms and conditions of the Lease,
Minimum Monthly Rent prorated for the entirety of the rental abatement
period at the average Minimum Monthly Rent for the Lease, plus any and
all other charges (such as Expenses or Real Estate Taxes) that were
abated during such rental abatement period.
For purposes of Section 467 of the Internal Revenue Code, the parties
to this Lease hereby agree to allocate the stated Rents, provided
herein, to the periods which correspond to the actual Rent payments as
provided under the terms and conditions of this agreement.
B. EXPENSES/REAL ESTATE TAXES. The purpose of this Section 4(b) is to
ensure that Tenant bears a share of all Expenses and Real Estate Taxes
related to the use, maintenance, ownership, repair or replacement, and
insurance of the Project. Accordingly, beginning on the date Tenant
takes possession of the Premises, Tenant shall each month pay to
Landlord one-twelfth (1/12) of Tenant's Share of Expenses and Real
Estate Taxes related to the Project. As used in this Lease, "Tenant's
Share of Real Estate Taxes" shall mean total Real Estate Taxes for the
Project multiplied by Tenant's Share (as defined in Section 1(i), and
"Tenant's Share of Expenses" shall mean total Expenses for the
Project, multiplied by Xxxxxx's Share, provided that Landlord may
specially allocate individual Expenses where and in the manner
necessary, in Xxxxxxxx's reasonable discretion, to appropriately
reflect the consumption of the expense or service. For example where
some but not all premises in the Project have HVAC, Landlord may
reallocate Project Expenses for HVAC to all premises utilizing HVAC to
be apportioned on a per square foot basis, or could allocate to each
premises utilizing HVAC the cost of maintaining that space's
individual unit. In the event the average occupancy level of the
Project for any year is less than ninety five percent (95%), the
actual Expenses for such year shall be proportionately adjusted to
reflect those costs which Landlord reasonably estimates would have
been incurred, had the Project been ninety five percent (95%) occupied
during such year.
1) EXPENSES DEFINED. The term "Expenses" shall mean all costs
and expenses of the ownership, operation, maintenance, repair or
replacement, and insurance of the Project, including without
limitation, the following costs:
(a) All supplies, materials, labor, equipment, and utilities
used in or related to the operation and maintenance of the
Project,
(b) All maintenance, management, janitorial, legal, accounting,
insurance, and service agreement costs related to the Project;
(c) All maintenance, replacement and repair costs relating to
the areas within or around the Project, including, without
limitation, air conditioning systems, sidewalks, landscaping,
service areas, driveways, parking areas (including resurfacing
and restriping parking areas), walkways, building exteriors
(including painting), signs and directories, repairing and
replacing
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roofs, walls, etc. These costs may be included either based on
actual expenditures or the use of an accounting reserve based on
past cost experience for the Project.
(d) Amortization (along with reasonable financing charges) of
capital improvements made to the Project which may be required by
any government authority or which will improve the operating
efficiency of the Project (provided, however, that the amount of
such amortization for improvements not mandated by government
authority shall not exceed in any year the amount of costs
reasonably determined by Landlord in its sole discretion to have
been saved by the expenditure either through the reduction or
minimization of increases which would have otherwise occurred).
(e) Landlord agrees that Expenses as defined in Section 4(b)
shall not include leasing commissions; payments of principal and
interest on any mortgages, deeds of trust or other encumbrances
upon the Project; depreciation of the capital cost of capital
improvements except as provided at 4(b)(1)(d) or (f); Landlord's
executive salaries, management fees in excess of market rates;
costs resulting from defective design or construction of the
Project; costs incurred in connection with entering into new
leases; or costs of disputes under existing leases. In no event
shall Expenses include any charge for which Landlord receives
reimbursement from insurance or from another Tenant, nor shall
any item of Expense be counted more than once, nor shall Landlord
collect more than one hundred percent (100%) of Expenses.
(f) Capital Expenditures. If, during the Term of this Lease,
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Landlord shall make a capital expenditure to replace an
improvement or system pursuant to Section 4(b)(1)(c) (except such
items as are Landlord's sole expense pursuant to Section 12
below) or that is otherwise chargable as an Expense pursuant to
Section 4(b)(1)(d), then Tenant shall pay Tenant's proportionate
share of the Annual Amortization of such capital expenditure.
Annual Amortization shall be determined by amortizing the
original capital expenditure at the interest rate then being
charged for long-term mortgages by institutional lenders on like
properties within the locality in which the Premises are located
over the number of years of the useful life of the capital
expenditure. With respect to capital expenditures, Tenant shall
commence payment as Additional Rent of one twelfth (1/12th) of
the annual amount shown in Landlord's notice with the next and
each succeeding installment of Basic Rent becoming due during the
Term, provided that the item for which the expenditure was made
has been fully completed on the date of Tenant's first payment,
and further provided that Tenant has received notice of such
amount at least fifteen (15) days prior to the date on which
payment is due, but if it is not so received, then Xxxxxx's
payment shall commence as of the following month. For purposes of
this Lease, "capital expenditure" is defined as (i) the
acquisition of a prior non-existing asset or the replacement of a
pre-existing asset, (ii) not acquired in the ordinary course of
business and (iii) not characterized as an operating cost or
expense, provided that the acquired asset must be premanently
affixed to the real estate and excludes all personal, removable
trade fixtures, and repairs to existing assets.
2) REAL ESTATE TAXES DEFINED. The term "Real Estate Taxes" shall
mean all taxes, assessments (general and special) and other impositions
or charges which may be taxed, charged, levied, assessed or imposed
upon all or any portion of or in relation to the Project or any portion
thereof, any leasehold estate in the Premises or measured by Rent from
the Premises, including any increase caused by the transfer, sale or
encumbrance of the Project or any portion thereof. "Real Estate Taxes"
shall also include any form of assessment, levy, penalty, charge or tax
(other than estate, inheritance, net income, or franchise taxe) imposed
by any authority having a direct or indirect power to tax or charge,
including, without limitation, any city, county, state federal or any
improvement or other district, whether such tax is (1) determined by
the value of the Project or the Rent or other sums payable under this
Lease; (2)
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upon or with respect to any legal or equitable interest of Landlord in
the Project or any part thereof; (3) upon this transaction or any
document to which Tenant is a party creating a transfer in any
interest in the Project, (4) in lieu of or as a direct substitute in
whole or in part of or in addition to any Real Estate Taxes on the
Project, (5) based on any parking spaces or parking facilities
provided in the Project, or (6) in consideration for services, such as
police protection, fire protection, street, sidewalk and roadway
maintenance, refuse removal or other services that may be provided by
any governmental or quasi-governmental agency from time to time which
were formerly provided without charge or with less charge to property
owners or occupants.
3) ANNUAL ESTIMATE OF TENANT'S SHARE OF EXPENSES AND REAL
ESTATE TAXES. When Xxxxxx takes possession of the Premises, Landlord
shall estimate Tenant's Share of Expenses and Real Estate Taxes for
the remainder of the calendar year, and at the commencement of each
calendar year thereafter, Landlord shall estimate Tenant's Share of
Expenses and Real Estate Taxes for the coming year by multiplying the
estimated annual Project Expenses and Real Estate Taxes by Xxxxxx's
Share.
4) MONTHLY PAYMENT OF EXPENSES AND REAL ESTATE TAXES. Tenant
shall pay to Landlord, monthly in advance, as Additional Rent, one-
twelfth (1/12) of the Annual Estimate of Xxxxxx's Share of Expenses
and Real Estate Taxes beginning on the date Tenant takes possession of
the Premises. As soon as practical following each calendar year,
Landlord shall prepare an accounting of actual Expenses and Real
Estate Taxes incurred during the prior calendar year and such
accounting shall reflect Tenant's Share of Expenses and Real Estate
Taxes. If the Additional Rent paid by Tenant under this Section
4(b)(4) during the preceding calendar year was less than the actual
amount of Tenant's Share of Expenses and Real Estate Taxes, Landlord
shall so notify Tenant and Tenant shall pay such amount to Landlord
within 30 days of receipt of such notice. Such amount shall be deemed
to have accrued during the prior calendar year and shall be due and
payable from Tenant even though the term of this Lease has expired or
this Lease has been terminated prior to Xxxxxx's receipt of this
notice. Tenant shall have thirty (30) days from receipt of such notice
to contest the amount due, failure to so notify Landlord shall
represent final determination of Tenant's Share of Expenses and Real
Estate Taxes. If Tenant's payments were greater than the actual
amount, then such overpayment shall be credited by Landlord to
Tenant's Share of Expenses and Real Estate Taxes due under this
Section 4(b)(4), or, if such overpayment is determined after the
expiration of this Lease, then after payment of any remaining sums
due from Tenant to Landlord, such overpayment shall be promptly
refunded by Landlord to Tenant.
C. RENT WITHOUT OFFSET AND LATE CHARGE. As used herein, "Rent" shall mean
all monetary sums due from Tenant to Landlord. All Minimum Monthly
Rent and Xxxxxx's Share of Expenses and Real Estate Taxes shall be
paid by Tenant to Landlord without prior notice or demand in advance
on the first day of every calendar month, at the address shown in
Section 1, or such other place as Landlord may designate in writing
from time to time. Whether or not so designated, all other sums due
from Tenant under this Lease shall constitute Additional Rent, payable
without prior notice or demand when specified in this Lease, but if
not specified, then within three (3) days of written demand. All Rent
shall be paid without any deduction or offset whatsoever. All Rent
shall be paid in lawful currency of the United States of America.
Proration of Rent due for any partial month shall be calculated by
dividing the number of days in the month for which Rent is due by the
actual number of days in that month and multiplying by the applicable
monthly rate. Tenant acknowledges that late payment by Tenant to
Landlord of any Rent or other sums due under this Lease will cause
Landlord to incur costs not contemplated by this Lease, the exact
amount of such cost being extremely difficult and impracticable to
ascertain. Such costs include, without limitation, processing and
accounting charges and late charges that may be imposed on Landlord by
the terms of any encumbrance or note secured by the Premises.
Therefore, if any Rent or other sum due from Tenant is not received
within ten (10) days of the date due, Tenant shall pay to Landlord an
additional sum equal to 8% of such overdue payment. Landlord
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and Xxxxxx hereby agree that such late charge represents a fair and
reasonable estimate of the costs that Landlord will incur by reason of
any such late payment and that the late charge is in addition to any
and all remedies available to the Landlord and that the assessment
and/or collection of the late charge shall not be deemed a waiver of
any other default. Additionally, all delinquent Rent or other sums,
plus this late charge, shall bear interest at the rate of 18 percent
per annum. If the interest rate specified in this Lease is higher than
the rate permitted by law, the interest rate is hereby decreased to
the maximum legal interest rate permitted by law. Any payments of any
kind returned for insufficient funds will be subject to an additional
handling charge of $25.00, and thereafter, Landlord may require Tenant
to pay all future payments of Rent or other sums due by money order or
cashier's check.
5. DEPOSIT. Upon execution of this Lease, Tenant shall deposit a security
deposit as set forth in Section 1(i) with Landlord. If Tenant has not been
in default at any time as of the end of the thirty-six (36/th/) month of
the Lease Term, Landlord shall promptly return $24,338 of the Security
Deposit at that time. If Tenant has not been in default at any time as of
the end of the forth-eighth (48/th/) month of the Lease Term, Landlord
shall promptly return an additional $25,352 of the Security Deposit at that
time (leaving a balance of $26,367). If Tenant is in default at any time,
Landlord can use the security deposit or any portion of it to cure the
default or to compensate Landlord for any damages sustained by Landlord
resulting form Tenant's default. Upon demand, Xxxxxx shall immediately pay
to Landlord a sum equal to the portion of the security deposit expended or
applied by Landlord to restore the security to its full amount. In no event
will Tenant have the right to apply any part of the security deposit to any
Rent or other sums due under this Lease. If Tenant is not in default at the
expiration or termination of this Lease, Landlord shall return the
remaining balance of the security deposit to Tenant. Landlord's obligations
with respect to the deposit are those of a debtor and not of a trustee, and
Landlord can commingle the security deposit with Xxxxxxxx's general funds.
Landlord shall not be required to pay Tenant interest in deposit. Landlord
shall be entitled to immediately endorse and cash Xxxxxx's prepaid deposit;
however, such endorsement and cashing shall not constitute Landlord's
acceptance of this Lease. In the event Landlord does not accept this Lease,
Landlord shall promptly return said prepaid deposit. Each time the Minimum
Monthly Rent is increased, Tenant shall deposit additional funds with
Landlord sum sufficient to increase the security deposit to an amount which
bears the same relationship to the adjusted Minimum Monthly Rent as the
initial security deposit bore to the Minimum Monthly Rent.
6. USE OF PREMISES AND PROJECT FACILITIES. Tenant shall use the Premises
solely for the purposes set forth in Section 1 and for no other purpose
without obtaining the prior written consent of Landlord. Tenant
acknowledges that neither Landlord or any agent of Landlord has made any
representation or warranty with respect to the Premises or with respect to
the suitability of the Premises or the Project for the conduct of Tenant's
business, nor has Landlord agreed to undertake any modification, alteration
or improvement to the Premises or the Project, except as provided in
writing in this Lease. Tenant acknowledges that Landlord may from time to
time, at its sole discretion, make such modifications, alterations,
deletions or improvements to the Project as Landlord may deem necessary or
desirable, without compensation or notice to Tenant. Tenant shall promptly
comply with all laws, ordinances, orders and regulations affecting the
Premises and the Project, including, without limitation, any rules and
regulations that may be attached to this Lease and to any reasonable
modifications to these rules and regulations as Landlord may adopt from
time to time. Tenant acknowledges that, except for Landlord's obligations
pursuant to Section 12, Tenant is solely responsible for ensuring that the
Premises comply with any and all governmental regulations applicable to
Tenant's conduct of business on the Premises, and that Tenant is solely
responsible for any alterations or improvements that may be required by
such regulations, now existing or hereafter adopted (including but not
limited to compliance with the Americans with Disabilities Act) required as
a result of any special employee accommodations or any improvements or
alterations installed by Tenant after construction of Landlord's Work.
Tenant shall not do or permit anything to be done in or about the Premises
or bring or keep anything in the Premises that will in any way increase the
premiums paid by Landlord on its insurance related to the Project or which
will in any way increase the premiums for fire or casualty insurance
carried by other tenants in the Project. Tenant will not perform any act or
carry on any practices that may injure the Premises or the Project; that
may be a nuisance or menace to other tenants in the Project; or
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that shall in any way interfere with the quiet enjoyment of such other
tenants. Tenant shall not use the Premises for sleeping, washing clothes,
cooking (except incidental lunchroom uses) or the preparation, manufacture
or mixing of anything that might emit any objectionable odor, noises,
vibrations or lights onto such other tenants. If sound insulation is
required to muffle noise produced by Tenant on the Premises, Tenant at its
own cost shall provide all necessary insulation. Tenant shall not do
anything on the premises which will overload any existing parking or
service to the Premises. Pets and/or animals of any type shall not be kept
on the Premises.
Tenant acknowledges that the balance of the Building will be used by
Western PCS BTA 1 Corporation (Western Wireless) as a switching station,
including satellite dishes and a monopole antenna. Xxxxxx believes that
Tenant does not require any greater electrical, electromagnetic or radio
waive shielding than is required for general administrative office uses,
and agrees that if any such greater shielding is required, Tenant shall
install same at Tenant's expense. Tenant covenants and agrees that Tenant
shall not engage in any uses that would produce electrical, electromagnetic
or radio emissions that would interfere with the operations of a cellular
communications switching station.
7. HAZARDOUS SUBSTANCES; DISRUPTIVE ACTIVITIES
A. HAZARDOUS SUBSTANCES.
1) Tenant shall not, without Landlord's prior written consent, keep
on or around the Premises, Common Areas or Building, for use,
disposal, treatment, generation, storage or sale, any substances
designed as, or containing components designated as hazardous,
dangerous, toxic or harmful (collectively referred to as "Hazardous
Substances"), and/or is subject to regulation, statute or ordinance.
Landlord hereby consents to Tenant's use of such Hazardous Substances
(and in such amounts) as are commonly used in general administrative
office uses, provided all such Hazardous Substances are used in
compliance with the requirements of this Section 7. With respect to
any Hazardous Substance, Tenant shall:
(a) Comply promptly, timely, and completely with all
governmental requirements for reporting, keeping, and
submitting manifests, and obtaining and keeping current
identification numbers;
(b) Submit to Landlord true and correct copies of all
reports, manifests, and identification numbers within five
(5) days of the time they are required to be and/or are
submitted to the appropriate governmental authorities;
(c) Within five (5) days of Landlord's written request,
submit written reports to Landlord regarding Tenant's use,
storage, treatment, transportation, generation, disposal or
sale of Hazardous Substances and provide evidence
satisfactory to Landlord of Tenant's compliance with the
applicable government regulations;
(d) Allow Landlord or Xxxxxxxx's agent or representative to
come on the premises at all reasonable times to check
Tenant's compliance with all applicable governmental
regulations regarding Hazardous Substances;
(e) Comply with minimum levels, standards or other
performance standards or requirements which may be set forth
or established for certain Hazardous Substances (if minimum
standards or levels are applicable to Hazardous Substances
present on the Premises, such levels or standards shall be
established by an on-site inspection by the appropriate
governmental authorities and shall be set forth in an
addendum to this Lease); and
(f) Comply with all applicable governmental rules,
regulations and requirements regarding the proper and lawful
use, sale, transportation, generation, treatment, and
disposal of Hazardous Substances.
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2) COSTS. Any and all costs incurred by Landlord and associated with
Landlord's monitoring of Tenant's compliance with this Section 7,
including Landlord's reasonable attorney's fees and costs, shall be
Additional Rent and shall be due and payable to Landlord within five
(5) days of written demand by Landlord.
B. CLEANUP COSTS, DEFAULT AND INDEMNIFICATION.
1) Tenant shall be fully and completely liable to Landlord for any
and all cleanup costs, and any and all other charges, fees, penalties
(civil and criminal) imposed by any governmental authority with
respect to Tenant's use, disposal, transportation, generation and/or
sale of Hazardous Substances, in or about the Premises, Common Areas,
or Building.
2) Tenant shall indemnify, defend and save Landlord and Landlord's
lender, if any, harmless from any and all of the costs, fees,
penalties and charges assessed against or imposed upon Landlord (as
well as Landlord's and Landlord's lender's reasonable attorneys' fees
and costs) as a result of Tenant's use, disposal, transportation,
generation and/or sale of Hazardous Substances.
3) Upon Tenant's default under this Section 8, in addition to the
rights and remedies set forth elsewhere in this Lease, Landlord shall
be entitled to the following rights and remedies:
(a) In the event of a threat of damage to persons or property
that Tenant does not commence to cure within twenty-four (24)
hours of notice from Landlord (or such shorter time as is
reasonably required in an emergency), and/or if Tenant fails to
continue such cure using best available technology, then Landlord
may terminate this Lease; and/or
(b) To recover any and all damages associated with the default,
including, but not limited to cleanup costs and charges, civil
and criminal penalties and fees, loss of business and sales by
Landlord and other tenants of the Building, any and all damages
and claims asserted by third parties and Landlord's reasonable
attorneys' fees and costs.
C. DISPOSAL OF WASTE
1) REFUSE DISPOSAL. Tenant shall not keep any trash, garbage,
waste or other refuse on the Premises except in sanitary containers
and shall regularly and frequently remove same from the Premises.
Tenant shall keep all incinerators, containers or other equipment used
for storage or disposal of such materials in a clean and sanitary
condition.
2) SEWAGE DISPOSAL. Tenant shall properly dispose of all sanitary
sewage and shall not use the sewage disposal system (a) for the
disposal of anything except sanitary sewage or (b) in excess of the
lesser amount (i) reasonably contemplated by the uses permitted under
this Lease or (ii) permitted by any governmental entity. Tenant shall
keep the sewage disposal system free of all obstructions and in good
operating condition.
3) DISPOSAL OF OTHER WASTE. Tenant shall properly dispose of all
other waste or other matter delivered to, stored upon, located upon or
within, used on, or removed from, the Premises in such a manner that
it does not, and will not, adversely affect the (a) health or safety
of persons within the Premises or the Project (or outside the Project
if such effect would result in liability to Landlord), (b) condition,
use or enjoyment of the Premises or the Project or any area outside
the Project if such effect would result in liability to Landlord, or
(c) Premises or Project or any of the improvements thereto or thereon
including buildings, foundations, pipes, utility lines, landscaping or
parking areas.
D. DISRUPTIVE ACTIVITIES. Tenant shall not:
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1) Produce, or permit to be produced, any intense glare, light or
heat except within an enclosed or screened area and then only in such
manner that the glare, light or heat shall not, outside the Premises,
be materially different that the light or heat from other sources
outside the Premises;
2) Create, or permit to be created, any sound pressure level which
will interfere with the quiet enjoyment of any real property outside
the Premises, or which will create a nuisance or violate any
governmental law, rule, regulation or requirement;
3) Create, or permit to be created, any ground vibration that is
materially discernible outside the Premises;
4) Transmit, receive or permit to be transmitted or received, any
electromagnetic, microwave or other radiation which is harmful or
hazardous to any person or property in, or about the Project; or
5) Create, or permit to be created, any noxious odor that is
disruptive to the business operations of any other tenant in the
Project.
8. SIGNAGE. All signing shall comply with rules and regulations set forth by
Landlord as may be modified from time to time. Current rules and
regulations relating to signs are described on Exhibit D. Tenant shall be
permitted to install exterior Building signage permitted under applicable
codes and regulations and subject to Landlord's prior written consent,
which shall not be unreasonably withheld for signage consistent with other
signage in the Project. Tenant shall place no window covering (e.g.,
shades, blinds, curtains, drapes, screens, or tinting materials),
stickers, signs, lettering, banners or advertising or display material on
or near exterior windows or doors if such materials are visible from the
exterior of the Premises, without Landlord's prior written consent.
Similarly, Tenant may not install any alarm boxes, foil protection tape or
other security equipment on the Premises without Landlord's prior written
consent which shall not be unreasonably withheld. Any material violating
this provision may be destroyed by Landlord without compensation to Tenant.
9. PERSONAL PROPERTY TAXES. Tenant shall pay before delinquency all taxes,
assessments, license fees and public charges levied, assessed or imposed
upon its business operations as well as upon all trade fixtures, leasehold
improvements, merchandise and other personal property in or about the
Premises.
10. PARKING. Tenant shall be entitled to up to the number of vehicle parking
spaces specified in Section 1(1), unreserved and unassigned, on those
portions of the Common Area designated by Landlord for parking.
A. BASIC REGULATIONS.
1) Tenant shall not use more parking spaces than said number. Said
parking spaces shall be used only for parking by vehicles no larger
than full size passenger automobiles or vans or similar size vehicles
which can fit in a single parking space.
2) Tenant shall not permit or allow any vehicles that belong to or are
controlled by Tenant or Tenant's employees, suppliers, shippers,
customers, or invitees to be loaded, unloaded, or parked in areas
other than those designated by Landlord for such activities.
3) If Tenant permits or allows any of the prohibited activities
described in This Section 10, then Landlord shall have the right, in
addition to such other rights and remedies that it may have, to remove
or tow away the vehicle and charge the cost to Tenant, which cost
shall be due and payable within five (5) days of written demand by
Landlord.
4) All automobiles, trucks, and other vehicles of Tenant, Tenant's
subtenants, concessionaires and licensees and their officers, agents
and employees shall be parked only in such place as may be designated
by Landlord as employee parking
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areas. If requested by Landlord, Tenant will furnish Landlord with
license numbers of said vehicles.
B. ADDITIONAL REGULATIONS. Landlord reserves the right at any time to
grant similar non-exclusive use to other tenants, to promulgate rules
and regulations relating to the use of such parking areas, including
reasonable restrictions on parking by tenants and employees, to
designate specific spaces for the use of any tenant, to make changes
in the parking layout from time to time, and to establish reasonable
time limits on parking. Landlord's current rules and regulations are
attached hereto as Exhibit E.
11. UTILITIES. Tenant shall pay for all water, gas, heat, light, power,
sewer, electricity, telephone or other service metered, chargeable or
provided to the Premises and not otherwise charged as part of Tenant's
Share of Expenses and shall be responsible for procuring and paying for
janitorial and waste disposal services. Landlord reserves the right to
install separate meters for any such utility and to charge Tenant for the
actual cost of such installation.
12. MAINTENANCE. Landlord shall maintain, in good condition, the structural
parts of the Premises, which shall include only the foundations, bearing
and exterior walls (excluding glass), subflooring and roof (excluding
skylights), the unexposed electrical, plumbing and sewerage systems,
including those portions of the systems lying outside the Premises, gutters
and downspouts on the Building; provided, however, the cost of all such
maintenance shall be considered "Expenses" for purposes of Section 4(b),
provided only that during the first twelve (12) months of the Lease Term,
Landlord shall be solely responsible for any capital replacements or
repairs required on the roof or HVAC and not caused by Tenant's work within
the Building or the Premises. Except as provided above, Tenant shall
maintain and repair the Premises in good condition, including, without
limitation, maintaining and repairing all walls, storefronts, floors,
ceilings, interior and exterior doors, exterior and interior windows and
fixtures and interior plumbing as well as damage caused by Tenant, its
agents, employees or invitees, as well as maintaining a commercially
reasonable HVAC maintenance contract (a copy of which shall be provided to
Landlord). Upon expiration or termination of this Lease, Xxxxxx shall
surrender the Premises to Landlord in the same condition as existed at the
commencement of the term, except for reasonable wear and tear or damage
caused by fire or other casualty for which Xxxxxxxx has received all funds
necessary for restoration of the Premises from insurance proceeds.
13. ALTERATIONS. Tenant shall not make any alterations to the Premises, or to
the Project, including any changes to the existing landscaping, without
Landlord's prior written consent. If Landlord gives its consent to such
alterations, Landlord may post notices in accordance with the laws of the
State of Washington. Any alterations made shall remain on and be
surrendered with the Premises upon expiration or termination of this Lease,
except that Landlord may, within 30 days before or 30 days after expiration
of the term, elect to require Tenant to remove any alterations which Tenant
may have made to the Premises. If Landlord so elects, at its own cost
Tenant shall restore the Premises to the condition designated by Landlord
in its election, before the last day of the term or within 30 days after
notice of its election is given, whichever is later, provided that the
"condition designated by Landlord" must be either the condition of the
Premises at the time of completion of the initial Premises Improvements or
such other condition as would require no greater restoration cost than
would be required to restore the Premises to the condition at the time of
completion of the initial Premises Improvements.
Should Landlord consent in writing to Tenant's alteration of the Premises,
Tenant shall contract with a contractor approved by Landlord for the
construction of such alterations, shall secure all appropriate governmental
approvals and permits, and shall complete such alterations with due
diligence in compliance with plans and specifications reasonably approved
by Landlord. All such construction shall be performed in a manner which
will not interfere with the quiet enjoyment of other tenants of the
Project. Tenant shall pay all costs for such construction and shall keep
the Premises and the Project free and clear of all mechanics' liens which
may result from construction by Tenant.
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14. RELEASE AND INDEMNITY.
A. INDEMNITY. Tenant shall indemnify, defend (using legal counsel
acceptable to Landlord) and save Landlord and its property manager
harmless from all claims, suits, losses, damages, fines penalties,
liabilities and expenses (including Landlord's personnel and overhead
costs and reasonable attorneys fees and other costs incurred in
connection with claims, regardless of whether such claims involve
litigation) resulting from any actual or alleged injury (including
death) of any person or from any actual or alleged loss of or damage
to, any property arising out of or in connection with (i) Tenant's
occupation, use or improvement of the Premises, or that of its
employees, agents or contractors, (ii) Tenant's breach of its
obligations hereunder, or (iii) any act or omission of Tenant or any
subtenant, licensee, assignee or concessionaire of Tenant, or of any
officer, agent, employee, guest or invitee of Tenant, or of any such
entity in or about the Premises. Xxxxxx agrees that the foregoing
indemnity specifically covers actions brought by its own employees.
This indemnity with respect to acts or omissions during the term of
this Lease shall survive termination or expiration of this Lease. The
foregoing indemnity is specifically and expressly intended to,
constitute a waiver of Tenant's immunity under Washington's Industrial
Insurance Act, RCW Title 51, to the extent necessary to provide
Landlord with a full and complete indemnity from claims made by Tenant
and its employees, to the extent provided herein. Tenant shall
promptly notify Landlord of casualties or accidents occurring in or
about the Premises. LANDLORD AND TENANT ACKNOWLEDGE THAT THE
INDEMNIFICATION PROVISIONS OF SECTION 7(B) AND THIS SECTION 14 WERE
SPECIFICALLY NEGOTIATED AND AGREED UPON BY THEM.
B. RELEASE. Tenant hereby fully and completely waives and releases all
claims against Landlord for any losses or other damages sustained by
Tenant or any person claiming through Tenant resulting from any
accident or occurrence in or upon the Premises, including but not
limited to: any defect in or failure of Project equipment; any failure
to make repairs; any defect, failure, surge in, or interruption of
Project facilities or services; any defect in or failure of Common
Areas; broken glass; water leakage; the collapse of any Building
component; or any act, omission or negligence of co-tenants, licensees
or any other persons or occupants of the Building, provided only that
the release contained in this Section 14(b) shall not apply to claims
for actual damage to persons or property (excluding consequential
damages such as lost profits) resulting directly from Landlord's gross
negligence or breach of its express obligations under this Lease which
Landlord has not cured within a reasonable time after receipt of
written notice of such breach from Tenant.
C. LIMITATION ON INDEMNITY. In compliance with RCW 4.24.115 as in effect
on the date of this Lease, all provisions of this Lease pursuant to
which Landlord or Tenant (the "Indemnitor") agrees to indemnify the
other (the "Indemnitee") against liability for damages arising out of
bodily injury to Persons or damage to property relative to the
construction, alteration, repair, addition to, subtraction from,
improvement to, or maintenance of, any building, road, or other
structure, project, development, or improvement attached to real
estate, including the Premises, (i) shall not apply to damages caused
by or resulting from the sole negligence of the Indemnitee, its agents
or employees, and (ii) to the extent caused by or resulting from the
concurrent negligence of (a) the Indemnitee or the Indemnitee's agents
or employees, and (b) the Indemnitor or the Indemnitor's agents or
employees, shall apply only to the extent of the Indemnitor's
negligence; PROVIDED, HOWEVER, the limitations on indemnity set forth
in this Section shall automatically and without further act by either
Landlord or Tenant be deemed amended so as to remove any of the
restrictions contained in this Section no longer required by then
applicable law.
D. DEFINITIONS. As used in any Section establishing indemnity or release
of Landlord, "Landlord" shall include Landlord, its partners,
officers, agents, employees and contractors, and "Tenant" shall
include Tenant and any person or entity claiming through Tenant.
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15. INSURANCE. Tenant, at its cost, shall maintain public liability and
property damage insurance and (if any product is manufactured on the
Premises) products liability insurance, all with a single combined
liability limit of $2,000,000, insuring against all liability of Tenant and
its representatives, employees, invitees, and agents arising out of or in
connection with Xxxxxx's use or occupancy of the Premises. Public liability
insurance, products liability insurance (if applicable) and property damage
insurance shall insure performance by Tenant of the indemnity provisions of
Section 14. Landlord and its management contractor shall be named as
additional insured and the policy shall contain cross-liability
endorsements. On all its personal property, at its cost, Tenant shall
maintain a policy of standard fire and extended coverage insurance with
vandalism and malicious mischief endorsements and "all risk" coverage on
all Tenant's improvements and alterations, including without limitation,
all items of Tenant responsibility described in Section 12 in or about the
Premises, to the extent of at least 90% of their full replacement value.
The proceeds from any such policy shall be used by Tenant for the
replacement of personal property and the restoration of Tenant's
improvements or alterations. All insurance required to be provided by
Tenant under this Lease shall release Landlord from any claims for damage
to business or to any person or the Premises and the Project, and to
Tenant's fixtures, personal property, improvements and alterations in or on
the Premises or the Project, caused by or resulting from risks insured
against under any insurance policy carried by Tenant in force at the time
of such damage. In addition, Tenant hereby independently releases Landlord
from any and all claims for damage to business or to any person or the
Premises and the Project, and to Tenant's fixtures, personal property,
improvements and alterations in or on the Premises or the Project, caused
by or resulting from risks that would have been insured against under any
insurance policy required by this Lease to be carried by Xxxxxx, even if
Tenant failed to so carry the required insurance. All insurance required to
be provided by Tenant under this Lease; (a) shall be issued by Insurance
companies authorized to do business in the state in which the premises are
located with a financial rating of at least an A+X status as rated in the
most recent edition of Best's Insurance Reports; (b) shall be issued as a
primary policy; shall be on an occurrence basis; and (d) shall contain an
endorsement requiring at least 30 days prior written notice of cancellation
to Landlord and Landlord's lender, before cancellation or change in
coverage, scope or amount of any policy. Tenant shall deliver a certificate
or copy of such policy together with evidence of payment of all current
premiums to Landlord within 30 days of execution of this Lease. If Tenant
fails at any time to maintain the insurance required by this Lease, and
fails to cure such default within five (5) business days of written notice
from Landlord then, in addition to all other remedies available under this
Lease and applicable law, Landlord may purchase such insurance on Tenant's
behalf and the cost of such insurance shall be Additional Rent due within
ten (10) days of written invoice from Landlord to Tenant.
16. DESTRUCTION. If during the term, the Premises or Project are more than 10%
destroyed from any cause, or rendered inaccessible or unusable from any
cause, Landlord may, in its sole discretion, terminate this Lease by
delivery of notice to Tenant within 30 days of such event without
compensation to Tenant. If in Landlord's estimation, the Premises cannot be
restored within 90 days following such destruction, the Landlord shall
notify Tenant and Tenant may terminate this Lease by delivery of notice to
Landlord within 30 days of receipt of Landlord's notice. If neither
Landlord nor Tenant terminates this Lease as provided above, then Landlord
shall commence to restore the Premises in compliance with then existing
laws and shall complete such restoration with due diligence. In such event,
this Lease shall remain in full force and effect, but there shall be an
abatement of Minimum Monthly Rent and Xxxxxx's Share of Expenses between
the date of destruction and the date of completion of restoration, based on
the extent to which destruction interferes with Xxxxxx's use of the
Premises.
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17. CONDEMNATION.
A. TAKING. If all of the Premises are taken by Eminent Domain, this
Lease shall terminate as of the date Tenant is required to vacate the
Premises and all Minimum and Additional Rent shall be paid to that
date. The term "Eminent Domain" shall include the taking or damaging
of property by, through or under any governmental or statutory
authority, and any purchase or acquisition in lieu thereof, whether
the damaging or taking is by government or any other person. If, in
the reasonable judgment of Landlord, a taking of any part of the
Premises by Eminent Domain renders the remainder thereof unusable for
the business of Tenant (or the cost of restoration of the Premises is
not commercially reasonable), the Lease may, at the option of either
party, be terminated by written notice given to the other party not
more than thirty (30) days after Landlord gives Tenant written notice
of the taking, and such termination shall be effective as of the date
when Tenant is required to vacate the portion of the Premises so
taken. If this Lease is so terminated, all Minimum and Additional Rent
shall be paid to the date of termination. Whenever any portion of the
Premises is taken by Eminent Domain and this Lease is not terminated,
Landlord shall at its expense proceed with all reasonable dispatch to
restore, to the extent of available proceeds and to the extent it is
reasonably prudent to do so, the remainder of the Premises to the
condition they were in immediately prior to such taking, and Tenant
shall at its expense proceed with all reasonable dispatch to restore
its personal property and all improvements made by it to the Premises
to the same condition they were in immediately prior to such taking.
The Minimum and Additional Rent payable hereunder shall be reduced
from the date Tenant is required to partially vacate the Premises in
the same proportion that the Rentable Area taken bears to the total
Rentable Area of the Premises prior to taking.
B. AWARD. Landlord reserves all right to the entire damage award or
payment for any taking by Eminent Domain, and Tenant waives all claim
whatsoever against Landlord for damages for termination of its
leasehold interest in the Premises or for interference with its
business. Tenant hereby grants and assigns to Landlord any right
Tenant may now have or hereafter acquire to such damages and agrees to
execute and deliver such further instruments of assignment as Landlord
may from time to time request. Tenant shall, however, have the right
to claim from the condemning authority all compensation that may be
recoverable by Tenant on account of any loss incurred by Tenant in
moving Tenant's merchandise, furniture, trade fixtures and equipment,
provided, however, that Tenant may claim such damages only if they are
awarded separately in the eminent domain proceeding and not out of or
as part of Landlord's damages.
18. ASSIGNMENT AND SUBLETTING.
A. RIGHT TO ASSIGN AND SUBLEASE. Landlord and Xxxxxx recognize and
specifically agree that this Section 18 is an economic provision, like
Rent, and that the Landlord's right to recapture, and to share in
profits, is granted by Tenant to Landlord in consideration of certain
other economic concessions granted by Landlord to Tenant. Tenant may
voluntarily assign its interest in this Lease or in the Premises, or
sublease all or any part of the Premises, or allow any other person or
entity to occupy or use all or any part of the Premises, upon first
obtaining Landlord's prior consent. Such consent shall not be
unreasonably withheld provided that such assignment or sublease does
not conflict with or result in a breach of Sections 1(d) and 6 (Use)
and the proposed assignee or sublessee of Tenant's proposed assignment
or sublease is not:
1) a governmental entity;
2) a person with whom Xxxxxxxx has negotiated for space in the
Project during the twelve (12) month period ending with the date
Landlord receives notice of such assignment, encumbrance or
subletting;
3) if there is a then-existing vacancy in the Project, a
present Tenant in the Project;
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4) a person or business entity whose tenancy in the Project
would violate any exclusivity arrangement which Landlord has with any
other tenant;
5) a person whose tenancy results in a greater parking burden
than existed under Tenant's initial general administrative office use.
Any assignment, encumbrance or sublease without Landlord's prior consent
shall be voidable, at Landlord's election, and shall constitute a default.
No consent to an assignment, encumbrance or sublease shall constitute a
further waiver of the provisions of this Section 18.
B. PROCEDURE FOR ASSIGNMENT AND SUBLEASE/LANDLORD'S RECAPTURE RIGHTS.
Tenant shall advise Landlord by notice of (1) Xxxxxx's intent to
assign, encumber, or sublease this Lease, (2) the name of the proposed
assignee or sublessee, and evidence reasonably satisfactory to
Landlord that such proposed assignee or sublease is comparable in
reputation, stature and financial condition to the other tenants then
leasing comparable space in the Project, and (3) the terms of the
proposed assignment or subletting. Landlord shall, within thirty (30)
days of receipt of such notice and receipt of any additional
information requested by Xxxxxxxx concerning the proposed assignee's
or sublessee's responsibility, elect one of the following:
(i) Acknowledge that it does not object to such proposed
assignment, encumbrance or sublease;
(ii) Object to such proposed assignment, encumbrance or
sublease, which objection shall be on reasonable grounds; or
(iii) Elect to terminate the Lease in the event of an assignment,
or in the case of a sublease for the then remaining balance of
the term, terminate this Lease as to the portion of the Premises
proposed to be sublet for the proposed term of the sublease.
C. CONDITIONS REGARDING CONSENT TO SUBLEASE AND ASSIGNMENT. As a
condition for Landlord not objecting to any assignment, encumbrance or
sublease, Tenant must require that the rent payable by such assignee
or sublessee is at least at the then current rental rates for the
Premises or comparable space in the Project, but not less than the
then current Rent under this Lease and, if Landlord so requests, shall
require that the assignee or sublessee remit directly to Landlord on a
monthly basis, all rent due to Tenant by said assignee or sublessee.
In the event that Landlord does not object to an assignment or
sublease under the provisions of this Section 18, Tenant shall pay
Landlord's reasonable processing costs and reasonable attorney's fees
incurred by Landlord agreeing not to object. Notwithstanding any
permitted assignment or subletting, Tenant shall at all times remain
directly, primarily and fully responsible and liable for all payments
owed by Tenant under the Lease and for compliance with all obligations
under the terms, provisions and covenants of the Lease. If for any
proposed assignment or sublease, Tenant receives rent or other
consideration, either initially or over the term of the assignment or
sublease, in excess of the Rent required by this Lease, or, in the
case of the sublease of a portion of the Premises, in excess of such
rent fairly allocable to such portion, after appropriate adjustments
to assure that all other payments called for hereunder are taken into
account, Tenant shall pay to Landlord as additional rent, one hundred
percent (100%) of the excess of each such payment of rent or other
consideration received by Tenant within five (5) days of its receipt.
D. AFFILIATED COMPANIES/RESTRUCTURING OF BUSINESS ORGANIZATION. Occupancy
of all or part of the Premises by parent, subsidiary, or affiliated
companies of Tenant shall not be deemed an assignment or subletting
provided that such parent, subsidiary or affiliated companies were not
formed as a subterfuge to avoid the obligation of this Section 18. If
Tenant is a corporation, unincorporated association, trust or general
or limited partnership, then the sale, assignment, transfer or
hypothecation of any
14
shares, partnership interest, or other ownership interest of such
entity which from time to time in the aggregate exceeds twenty-five
percent (25%) of the total outstanding shares, partnership interests
or ownership interest of such entity (provided that the sale or
issuance or trading of publicly held and traded shares shall not
trigger this provision) or which effects a change in the management or
control of Tenant, or the dissolution, merger, consolidation, or other
reorganization of such entity, or the sale, assignment, transfer or
hypothecation of more than forty percent (40%) of the value of the
assets of such entity, shall be deemed an assignment subject to the
provisions of this section.
19. DEFAULT. The occurrence of any of a the following shall constitute a
default by Tenant: (a) a failure to pay Rent or other charge when due,
provided that Landlord shall not exercise any of its rights under this
Section 19(a) until Landlord has given Tenant notice of such default and a
cure period of (3) days from receipt of such notice, and Tenant has failed
to pay such rent or other charge within such cure period; (b) abandonment
and vacation of the Premises (failure to occupy and operate the Premises
for ten consecutive day shall be conclusively deemed an a and vacation); or
(c) failure to perform any other provision of this Lease, provided that
Landlord shall not exercise any of its rights under this Section 19(c)
until Landlord has given Tenant notice of such default and a cure period of
thirty (30) days from receipt of such notice, and Tenant has failed to cure
such default within such cure period, period, provided further that if more
that thirty (30) days are required to complete such performance, the cure
period shall not be deemed to have run so long as Tenant commences to cure
such default within the thirty (30) day period and thereafter diligently
pursues its completion. The notice required by this Section is intended to
satisfy any and all notice requirements imposed by law on Landlord and is
not in addition to any such requirement.
20. LANDLORD'S REMEDIES. Landlord shall have the following remedies if Tenant
is in default. (These remedies are not exclusive; they are cumulative and
in addition to any remedies now or later allowed by law): Landlord may
terminate Tenant's right to possession of the Premises at any time. No act
by Landlord other than giving notice to Tenant shall terminate this Lease.
Acts of maintenance, efforts to relet the Premises, or the appointment of
a receiver on Landlord's initiative to protect Xxxxxxxx's interest under
this Lease shall not constitute a termination of Tenant's right to
possession. Upon termination of Tenant's right to possession, Landlord has
the right to recover from Tenant: (1) the worth of the unpaid Rent that had
been earned at the time of termination of Tenant's right to possession; (2)
the worth of the amount of the unpaid Rent that would have been earned
after the date of termination of Tenant's right to possession; (3) any
other amount, including but not limited to, expenses incurred to relet the
Premises, court, attorney and collection costs, necessary to compensate
Landlord for all detriment cause by Xxxxxx's default. Landlord acknowledges
that those amounts due under subsections (2) and (3) above are subject to
such obligation of Landlord to mitigate damages as exists under the laws of
the State of Washington. "The Worth," as used for Item (1) in this
Paragraph 20 is to be computed by allowing interest at the rate of 18
percent per annum. If the interest rate specified in this Lease is higher
that the rate permitted by law, the interest rate is hereby decreased to
the maximum legal interest rate permitted by law. "The Worth" as used for
Item (2) in this Paragraph 21 is to be cumputed by discounting the amount
at the discount rate of the Federal Reserve Bank of San Francisco at the
time of termination of Tenant's right of possession.
21. ENTRY ON PREMISES. Landlord and its authorized representatives shall have
the right to enter the Premises at all reasonable times and with reasonable
prior notice (except in an emergency, when no notice shall be required) for
any of the following purposes: (a) to determine whether the Premises are
in good condition and whether Tenant is complying with its obligations
under this Lease; (b) to do any necessary maintenance and to make any
restoration to the Premises or the Project that Landlord has the right or
obligation to perform; (c) to post "for sale" signs at any time during the
time, to post "for rent" or "for lease" signs during the last 90 days of
the term, or during any period while Tenant is in default; (d) to show the
Premises for sale to prospective brokers, agents, or buyers at any time
during the term, and for lease to prospective brokers, agents or tenants at
any time during the last 180 days of the term, or (e) to repair, maintain
or improve the Project and to erect scaffolding and protective barricades
around and about the Premises but not so as to prevent entry to the
Premises and to do any other act or thing necessary for the safety or
15
preservation of the Premises or the Project. Landlord shall not be liable
in any manner for any inconvenience, disturbance, loss of business,
nuisance or other damage arising out of Landlord's entry onto the Premises
as provided in this Section 21. Tenant shall not be entitled to an
abatement or reduction of Rent if Landlord exercises any rights reserved in
this Section 21. Landlord shall conduct his activities on the Premises as
provided herein in a commercially reasonable manner so as to limit
inconvenience, annoyance or disturbance to Tenant to the maximum extent
practicable. For each of these purposes, Landlord shall at all times have
and retain a key with which to unlock all the doors in, upon and about the
Premises, excluding Xxxxxx's vaults and safes. Tenant shall not alter any
lock or install a new or additional lock or bolt on any door of the
Premises without prior written consent of Landlord. If Landlord gives its
consent, Tenant shall furnish Landlord with a Key for any such lock.
22. SUBORDINATION. Without the necessity of any additional document being
executed by Tenant for the purpose of effecting a subordination, and at the
election of Landlord or any mortgagee or any beneficiary of a Deed of Trust
with a lien on the Project or any ground lessor with respect to the
Project, this Lease shall be subject and subordinate at all times to (a)
all ground leases or underlying leases which may now exist or hereafter be
executed affecting the Project, and (b) the lien of any mortgage or deed of
trust which may now exist or hereafter be executed in any amount for which
the Project, ground leases or underlying leases, or Landlord's interest or
estate in any of said items is specified as security. In the event that any
ground lease or underlying lease terminates for any reason or any mortgage
or Deed or Trust is foreclosed or a conveyance in lieu of foreclosure is
made for any reason, Tenant shall, notwithstanding any subordination,
attorn to and become the Tenant of the successor in interest to Landlord,
at the option of such successor in interest. Tenant covenants and agrees to
execute and deliver, upon demand by Xxxxxxxx and in the form requested by
Landlord any additional documents evidencing the priority or subordination
of this Lease with respect to any such ground lease or underlying leases or
the lien of any such mortgage or Deed of Trust. Tenant hereby irrevocably
appoints Landlord as attorney-in-fact of Tenant to execute, deliver and
record any such document in the name and on behalf of Xxxxxx.
Tenant, within ten days from notice from Landlord, shall execute and
deliver to Landlord, in recordable form, certificates stating that this
Lease is not in default, is unmodified and in full force and effect, or in
full force and effect as modified, and stating the modifications. This
certificate should also state the amount of current monthly Rent, the dates
to which Rent has been paid in advance, and the amount of any security
deposit and prepaid Rent. Failure to deliver this certificate to Landlord
within ten days shall be conclusive upon Tenant that this Lease is in full
force and effect and has not been modified except as may be represented by
Landlord.
23. NOTICE. Any notice, demand or request required hereunder shall be given in
writing to the party's facsimile number or address set forth in Section 1
hereof by any of the following means: (a) personal service; (b) electronic
communication, whether by telex, telegram or facsimile; (c) overnight
courier; or (d) registered or certified, first class mail, return receipt
requested. Such addresses may be changed by notice to the other parties
given in the same manner as above provided. Any notice, demand or request
sent pursuant to either subsection (a) or (b) hereof shall be deemed
received upon such personal service or upon dispatch by electronic means
with electronic confirmation of receipt. Any notice, demand or request
sent pursuant to subsection (c) hereof shall be deemed received on the
business day immediately following deposit with the overnight courier and,
if sent pursuant to subsection (d), shall be deemed received forty-eight
(48) hours following deposit in the U.S. mail.
24 WAIVER. No delay or omission in the exercise of any right or remedy by
Landlord shall impair such right or remedy or be construed as a waiver. No
act or conduct of Landlord, including without limitation, acceptance of the
keys to the Premises, shall constitute an acceptance of the surrender of
the Premises by Tenant before the expiration of the term. Only written
notice from Landlord to Tenant shall constitute acceptance of the surrender
of the Premises and accomplish termination of the Lease. Landlord's consent
to or approval or any act by Tenant requiring Landlord's consent or
approval shall not be deemed to waive or render unnecessary Landlord's
consent to or approval of any subsequent act by Xxxxxx. Any
16
waiver by Landlord of any default must be in writing and shall not be a
waiver of any other default concerning the same or any other provision of
the Lease. TENANT SPECIFICALLY ACKNOWLEDGES AND AGREES THAT, WHERE TENANT
HAS RECEIVED A NOTICE TO CURE DEFAULT (WHETHER RENT OR NON-RENT), NO
ACCEPTANCE BY LANDLORD OF RENT SHALL BE DEEMED A WAIVER OF SUCH NOTICE,
AND, INCLUDING BUT WITHOUT LIMITATION, NO ACCEPTANCE BY LANDLORD OF PARTIAL
RENT SHALL BE DEEMED TO WAIVE OR CURE ANY RENT DEFAULT. LANDLORD MAY, IN
ITS DISCRETION, AFTER RECEIPT OF PARTIAL PAYMENT OF RENT, REFUND SAME AND
CONTINUE ANY PENDING ACTION TO COLLECT THE FULL AMOUNT DUE, OR MAY MODIFY
ITS DEMAND TO THE UNPAID PORTION. IN EITHER EVENT THE DEFAULT SHALL BE
DEEMED UNCURED UNTIL THE FULL AMOUNT IS PAID IN GOOD FUNDS.
25. SURRENDER OF PREMISES; HOLDING OVER. Upon expiration of the term, Xxxxxx
shall surrender to Landlord the Premises and all Tenant improvements and
alterations in good condition, except for ordinary wear and tear and
alterations Tenant has the right or is obligated to remove under the
provisions of Section 13 herein. Tenant shall remove all personal property
including, without limitation, all data and phone wires, wallpaper,
paneling and other decorative improvements of fixtures and shall perform
all restoration made necessary by the removal of any alterations or
Tenant's personal property before the expiration of the term, including for
example, restoring all wall surfaces to their condition prior to the
commencement of this Lease. Landlord can elect to retain or dispose of in
any manner Xxxxxx's personal property not removed from the Premises by
Tenant at or prior to the expiration of the term. Tenant waives all claims
against Landlord for any damage to Tenant resulting from Xxxxxxxx's
retention or disposition of Xxxxxx's personal property. Tenant shall be
liable to Landlord for Landlord's cost for storage, removal or disposal of
Tenant's personal property.
If Xxxxxx, with Xxxxxxxx's consent, remains in possession of the Premises
after expiration or termination of the term, or after the date in any
notice given by Landlord to Tenant terminating this Lease, such possession
by Tenant shall be deemed to be a month-to-month tenancy terminable as
provided under Washington law, by either party. All provisions of this
Lease, except those pertaining to term and Rent, shall apply to the month-
to-month tenancy. During any holder term, Tenant shall pay Minimum Monthly
Rent in an amount equal to 125% over of Minimum Monthly Rent for the last
full calender month during the regular term plus 100% of Tenant's share of
Expenses pursuant to Section 4(b)(3).
26. LIMITATION OF LANDLORD'S LIABILITY. In consideration of the benefits
accruing hereunder, Xxxxxx agrees that, in the event of any actual or
alleged failure, breach or default of this Lease by Landlord, Landlord's
liability under this Lease shall be limited to, and Tenant shall look only
to Landlord's interest in the Project and the rents and proceeds (including
insurance proceeds) thereof.
27. BUILDING PLANNING. If Landlord requires the Premises for use in
conjunction with another suite or for other reasons connected with the
Project planning program, upon notifying Tenant in writing, Landlord shall
have the right to move Tenant to other space in the Project that is
substantially the same in size, configuration and tenant improvements, such
move (including out-of-pocket ancillary costs such as reprinting of
stationary) to be at Landlord's sole cost and expenses. Upon such move, the
terms and conditions of the original Lease shall remain in full force and
effect, save and excepting that a revised Exhibit "A" shall become part of
this Lease and shall reflect the location of the new space and Section 1 of
this Lease shall be amended to include and state all correct data as to the
new space.
28. MISCELLANEOUS PROVISIONS.
A. TIME OF ESSENCE. Time is of the essence of each provision of this
Lease.
B. SUCCESSOR. This Lease shall be binding on and inure to the benefit
of the parties and their successors, except as provided in Section 18
herein.
17
C. LANDLORD'S CONSENT. Except as otherwise specifically provided herein, any
consent required by Landlord under this Lease must be granted in writing
and may be withheld or conditioned by Landlord in its sole and absolute
discretion.
D. COMMISSIONS. Each party represents that it has not had dealings with any
real estate broker, finder or other person with respect to this Lease in
any manner, except for the broker identified in Section 1, who shall be
compensated by Landlord. Landlord and Tenant recognize that it is possible
that they may hereafter make additional agreements regarding further
extension or renewal of this Lease or a new lease or leases for all or one
or more parts of the Premises or other space in the Project for a term or
terms commencing after the Commencement Date of this Lease. Landlord and
Xxxxxx recognize that it is also possible that they may hereafter modify
this Lease to add additional space or to substitute space as part of the
Premises. If any such additional agreements, new leases or modifications to
this Lease are made, Landlord shall not have any obligation to pay any
compensation to any real estate broker or to any other third person engaged
by Tenant to render services to Tenant in connection with negotiating such
matters, regardless of whether under the circumstances such person is or is
not regarded by the law as an agent of Landlord.
E. OTHER CHARGES. If either party commences any litigation against the other
party or files an appeal of a decision arising out of or in connection with
the Lease, the prevailing party shall be entitled to recover from the other
party reasonable attorney's fees and costs of suit. If Landlord employs a
collection agency to recover delinquent charges, Xxxxxx agrees to pay all
collection agency and reasonable attorneys' fees charged to Landlord in
addition to Rent, late charges, interest and other sums payable under this
Lease.
F. FORCE MAJEURE. Landlord shall not be deemed in default hereof nor liable
for damages arising from its failure to perform its duties or obligations
hereunder if such is due to causes beyond its reasonable control,
including, but not limited to, acts of God, acts of civil or military
authorities, fires, floods, windstorms, earthquakes, strikes or labor
disturbances, civil commotion, delays in transportation, governmental
delays or war.
G. RULES AND REGULATIONS. Tenant shall faithfully observe and comply with the
"Rules and Regulations", a copy of which is attached hereto as Exhibit E,
and all reasonable and nondiscriminatory modifications thereof and
additions thereto from time to time put into effect by Landlord. Landlord
shall not be responsible to Tenant for the violation or non-performance by
any other tenant or occupant of the building or Project of said tenant or
occupant's lease or of any of said Rules and Regulations.
X. XXXXXXXX'S SUCCESSORS. In the event of a sale or conveyance by Landlord of
the Project, the same shall operate to release Landlord from any liability
under this Lease, and in such event Landlord's successor in interest shall
be solely responsible for all obligations of Landlord under this Lease.
I. INTERPRETATION. This Lease shall be construed and interpreted in accordance
with the laws of the state in which the premises are located. This Lease
constitutes the entire agreement between the parties with respect to the
Premises and the Project, except for such guarantees or modifications as
may be executed in writing by the parties from time to time. When required
by the context of this Lease, the singular shall include the plural, and
the masculine shall include the feminine and/or neuter. "Party" shall mean
Landlord or Tenant. If more than one person or entity constitutes Landlord
or Tenant, the obligations imposed upon the party shall be joint and
several. The enforceability, invalidity or illegality of any provision
shall not render the other provisions unenforceable, invalid or illegal.
J. CLEAN AIR ACT. Tenant acknowledges that Landlord has not made any made any
portion of the Premises or the Building accessible for smoking in
compliance with WAC 000-00-00000. If Tenant wishes to make any portion of
the Premises accessible for smoking, Tenant shall make all improvements
necessary to comply with all applicable governmental rules and regulations.
Tenant acknowledges that the
18
indemnity contained in Section 14 of the Lease includes, but is not
limited to claims based on the presence of tobacco smoke as a result
of the activities of Tenant, its employees, agents, or guests.
30. RIGHT OF FIRST OPPORTUNITY. This Right of First Opportunity shall apply to
those portions of the Building not included within the initial Premises
(the "Expansion Space"). At such time as Landlord intends to offer all or
part of the Expansion Space for lease (other than pursuant to an expansion
or renewal right of another tenant existing as of the date of full
execution of this Lease), Landlord shall so notify Tenant, which notice
shall include the terms (rate, term, etc.) on which Landlord intends to
offer the Expansion Space or part thereof (the "Offered Space"). Regardless
of whether Landlord intends to offer a tenant improvement allowance to the
general public, in its notice to Tenant, Landlord shall set forth what the
offer would be if a Five Dollar ($5.00) per rentable square foot
improvement allowance were offered for improvement of the Expansion Space.
In addition, the Expansion Space shall include use of parking stalls,
without charge, at the same ratio of parking stalls to rentable square
footage of the Expansion Space as exists with respect to the rentable
square footage of the initial Premises and the number of parking stalls
provided pursuant to Section 1(1). If Landlord is offering a portion of the
Expansion Space in conjunction with other, adjacent space, Landlord may
designate the entirety of such offered space as the Offered Space. Tenant
shall have five (5) business days from receipt of such notice to notify
Landlord that Xxxxxx agrees to enter into a lease for the Offered Space on
the terms stated in Landlord's notice or to enter into a lease for the
Offered Space on such other terms as may be mutually agreeable to Landlord
and Tenant in their sole discretion. If Xxxxxx does not enter into a lease
for the Offered Space as provided in the proceeding sentence, this Right of
First Opportunity immediately and without further action by Landlord
terminate in its entirely. The Right of First Opportunity shall be
exercisable by Tenant only if Tenant is in possession of the Premises under
this Lease and is not then nor has ever been in material default under this
Lease. The Right of First Opportunity is personal to Tenant and shall not
be exercisable by any assignee or sublessee.
31. OPTION TO RENEW. Tenant is granted the right to extend the term of this
Lease beyond the expiration date of the initial term for two periods of
thirty-six (36) months each (each an "Extended Term"). Tenant may not
exercise its Extension Right if it is then in default beyond any applicable
cure period or if it has ever been in default beyond any applicable cure
period more than two (2) times in any twelve (12) month period. Tenant may
exercise its Extension Right by delivering written notice thereof to
Landlord not earlier than one (1) year and not later than nine (9) months
prior to the expiration of the initial term or First Extended Term, as
applicable. In each Extended Term, all terms and conditions of this Lease
shall apply, except (i) there shall be no Tenant Improvement Allowance,
(ii) paragraph 30 of this Lease shall not apply, and (iii) the Minimum
Monthly Rent for each Extended Term shall be the then prevailing market
rate for a similar lease and term for similarly situated and improved space
in the Bothell-Woodinville High-Tech Industrial Market (the "Fair Market
Rent"), provided that in no event shall the Minimum Monthly Rent for the
Extended Term be less than the Minimum Monthly Rent for the last month of
the immediately prior term. In calculating Fair Market Rent, the then-
existing monthly rate for non-renewal tenants shall be used, without
deduction for commissions or tenant improvement allowances.
Extension Rights shall apply to all of the Premises then under lease to
Tenant. Tenant's Extension Right is personal and may not be exercised by
any assignee or sublessee other than an affiliate of Tenant or a successor
by merger or consolidation.
If Landlord and Tenant are not able to agree on the Fair Market for the
Extended Term within thirty days after Xxxxxx's notice of election to
renew, then such Fair Market Rent shall be determined as follows. Landlord
and Tenant shall each select an appraiser with at least ten years
experience in the office/high-tech industrial market in the eastside area.
If the two appraisers are unable to agree within ten days after their
selection, they shall select a similarly qualified third appraiser (the
"Neutral Appraiser"). Within twenty days after selection of the Neutral
Appraiser, the three appraisers shall simultaneously exchange
determinations of Fair Market Rent. If the lowest appraisal is not less
than
19
ninety percent (90%) of the highest appraisal, then the three appraisals shall
be averaged and the result shall be the Fair Market Rent. If the lowest
appraisal is less than ninety percent (90%) of the highest appraisal, then the
Fair Market Rent shall be deemed the rent set forth in the appraisal submitted
an appraiser appointed by a party that is closest in dollar amount to the
appraisal submitted by the Neutral Appraiser.
Landlord: TMT-BOTHELL, LLC
By /s/ Xxxxxxx XxXxxxxx
----------------------------
Its Vice-President
By ____________________________
Its
Tenant:________________________
By /s/ Xxxxx X. Xxxxxxx
----------------------------
Its President, CEO
By ____________________________
Its
STATE OF WASHINGTON )
)ss.
COUNTY OF KING )
I certify that I know or have satisfactory evidence that Xxxxxxx
XxXxxxxx is the person who appeared before me, and said person acknowledged that
he signed this instrument, on oath stated that he was authorized to execute the
instrument as the Vice President of TMT-BOTHELL, LLC to be the free and
voluntary act of such party for the uses and purposes mentioned in the
instrument.
Dated: 5/13/98
/s/ Xxxxx Xxxxxxxx
[Stamp Appears Here] -------------------------------
(Signature)
XXXXX XXXXXXXX
-------------------------------
(Print Name)
Notary Public, in and for the State of
Washington, residing at Seattle
My Commission Expires 2/4/01
20
SCHEDULE 1
XXXXXXXX'S WORK
BUILDING IMPROVEMENTS TO BE PROVIDED BY THE LANDLORD
----------------------------------------------------
All improvements provided by the Landlord shall be considered building standard
and will be constructed using building standard materials, and finishes.
Landlord shall be solely responsible for the work and expense of providing the
following building improvements:
(1) Separating of the existing HVAC and electrical systems to create a
multi-tenant configuration for the building.
(a) The building electrical power distribution shall circulate
through the four existing electrical rooms. Each electrical room
to be separately metered. Two electrical rooms on the first floor
and two rooms on the second floor. Each electrical room shall
have; a 300 APM 480/277 panel board with associated breakers for
lighting; a power distribution transformer and HVAC equipment,
and a 1400 AMP 120/208 volt 84 circuit two section panel for
distribution of Tenant's power outlets and 120 volt loads.
(b) Landlord shall provide separate gas meters to HVAC equipment
serving the first and second floors.
(2) The premises shall be demised as such to create a secure space for
Tenant, including a Premise entry door with closure and lockset
located in the first floor lobby and second floor fire stairs.
(3) Landlord shall provide three (3) secured doors with locksets and
closures to provide a secured space for the tenant. One (1) door to be
located at the first floor common entry lobby. One (1) door each on
the second floor of the fire exit stairways, west and north sides.
(4) Landlord shall create a first floor lobby area to provide a multi-
tenant common area entrance to the building with security card access
at the main entry door.
(5) Landlord shall provide keyed elevator access for after hour security
and access to the premises located on the second floor.
(6) Any modifications made to the Building by the Landlord will be
compliant with the Americans With Disabilities Act (ADA).
(7) Landlord shall replace any missing window coverings for all exterior
glazing. Replacement blinds shall match existing.
SCHEDULE 2
TENANT'S WORK
(TO BE INCLUDED AT A LATER DATE)
FIRST AMENDMENT TO LEASE
This FIRST AMENDMENT TO LEASE ("First Amendment") is made this 12/th/ day
of May, 1998, by and between TMT-BOTHELL LLC ("Landlord") SONOSIGHT, INC.
("Tenant").
RECITALS
--------
Landlord and Tenant are parties to that certain lease dated May 12, 1998,
(the "Lease") for premises located at 00000 Xxxxx Xxxxx Xxxxxxx, Xxxxxxx,
Xxxxxxxxxx 00000.
Landlord and Tenant wish to amend the Lease as more fully set forth herein.
Except as specifically set forth herein, all capitalized terms in this
First Amendment shall have the meanings assigned the Lease.
AGREEMENT
---------
NOW, THEREFORE, for good and valuable consideration, the parties hereto
agree as follows:
1. As used in the Lease, the "Project" shall be the building shown as
Building 4 on Exhibit B to the Lease. The Project is part of a larger
development (the "Development") as shown on said Exhibit B, Tenant
shall have the non-exclusive right in common with the tenants of
Building 3 to use the exterior portions of the Development (i.e.,
excluding the interior of Building 3). Landlord may include within the
Rules and Regulations reasonable and non-discriminatory provisions
regulating such joint use. Tenant's parking stalls as provided in
Section 10 of the Lease shall consist of unreserved use of the number
of stalls specified in Section 1(L) of the Lease within those parking
stalls shown on Exhibit B in the Development as a whole. Landlord
shall use reasonable best efforts to insure that Expenses relating to
the interior portions of Building 3 and Building 4 are separately
charged and accounted for. If and to the extent any Expenses are
charged to the Development as a whole (as will be the case, for
example, with respect to business park association dues, landscape
maintenance, irrigation water, and Real Estate Taxes), those Expenses
shall be allocated in the proportion of 28.24% to Building 3 and
71.76% to Building 4.
2. Except as specifically set forth herein, the Lease is unmodified and
is and remains in full force and effect.
Landlord: TMT-BOTHELL, LLC
By /s/ Xxxxxxx XxXxxxxx
-------------------------------------
Its VICE PRESIDENT
By_____________________________________
Its
Tenant: SONOSIGHT, INC.
By /s/ Xxxx Xxxxx
-------------------------------------
Its Sr. Mgr. Finance
By_____________________________________
Its
STATE OF WASHINGTON )
)ss.
COUNTY OF KING )
I certify that I know or have satisfactory evidence that Xxxxxxx XxXxxxxx
is the person who appeared before me, and said person acknowledged that he
signed this instrument, on oath stated that he was authorized to execute the
instrument as the Vice President of TMT-BOTHELL, LLC to be the free and
voluntary act of such party for the uses and purposes mentioned in the
instrument.
Dated 5/13/98
/s/ Xxxxx Xxxxxxxx
---------------------------------
(Signature)
[XXXXX APPEARS HERE] XXXXX XXXXXXXX
---------------------------------
(Print Name)
Notary public, in and for the
State of WASHINGTON, residing at
Seattle.
My Commission Expires 2/4/01
STATE OF WASHINGTON )
)ss.
COUNTY OF [ILLEGIBLE]^^ )
I certify that I know or have satisfactory evidence that ????? are the
persons who appeared before me, and said persons acknowledged that they signed
this instrument, on oath stated that they were authorized to execute the
instrument and acknowledged it to be the free and voluntary act of such party
for the uses and purposes mentioned in the instrument.
Dated: May 12, 1998
/s/ Xxxxx X. Xxxxx
--------------------------------
(Signature)
[NOTARY SEAL APPEARS HERE] XXXXX X. XXXXX
---------------------------------
(Print Name)
Notary Public, in and for the State
of Washington, residing at Seattle
My Commission Expires 6/15/98
STATE OF WASHINGTON )
)ss.
COUNTY OF SNOHOMISH )
I certify that I know or have satisfactory evidence that Xxxxx X.
Xxxxxxx is the person who appeared before me, and said person acknowledged that
they signed this instrument, on oath stated that they were authorized to execute
the instrument and acknowledged it as the signature of Xxxxx X. Xxxxxxx to be
the free and voluntary act of such party for the uses and the purposes mentioned
in the instrument.
Dated: May 9, 1998.
/s/ Xxxxx X. Xxxxx
-----------------------------
(Signature)
XXXXX X. XXXXX
-----------------------------
(Print Name)
Notary Public, in and for the State
[NOTARY SEAL APPEARS HERE] of Washington, residing at Seattle
My Commission Expires 6/15/99
21
EXHIBIT A
THE PREMISES
[FLOOR PLAN APPEARS HERE]
SECOND FLOOR PLAN -
-------------------------------
NOT TO SCALE
________________________________________________________________________________
NORTH CREEK TECH CENTER - BUILDING 4
BOTHELL, WASHINGTON
EXHIBIT B
THE PROJECT
Legal Description: Lot 4, Plat of Xxxx Company North Creek as Recorded in Volume
132 pages 29-35 Records of King County, Washington.
[PLAN APPEARS HERE]
EXHIBIT C
CERTIFICATE OF COMMENCEMENT DATE
SonoSight, Inc.
00000 Xxxxx Xxxxx Xxxxxxx, Second Floor
Bothell, WA 98011
RE: Lease Agreement Commencement Date
North Creek Technical Center I - Building 4
00000 Xxxxx Xxxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxxxx 00000
To Whom It May Concern:
Per Section 3, Term, of the Lease Agreement between TMT-Bothell, LLC and
SonoSight, Inc., the commencement and expiration date of the Lease are as
follows:
Commencement Date:____________________________
Expiration Date: ____________________________
If this date is in agreement with your records, please acknowledge by signing in
the space provided below and return a copy of this Exhibit C to our office as
soon as possible.
SONOSIGHT, INC.
Acknowledged By: _______________________________
Its: _______________________________
Return to Landlord at:
TMT-Bothell, LLC
c/x Xxxxxxx, XxXxxxxx & Company
0000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
EXHIBIT D
SIGNAGE
NORTH CREEK TECH CENTER
The sign criteria have been established for the purpose of maintaining the
overall appearance of the North Creek Tech Center. It must comply with the
covenants, conditions, and restrictions of North Creek Tech Center. Conformation
will be strictly enforced. Any sign installed without approval of the Landlord
will be brought into conformity at the expense of the Tenant.
REQUIREMENTS
------------
1. Landlord shall provide the following signage at no cost to Tenant:
a) Xxxxxx's name and suite number on all exterior project directories and
one (1) mailbox.
b) Tenant's suite number on interior suite plaque.
2. Tenant shall be responsible for the construction and installation of
building mounted company signs where applicable.
3. No advertisement, sign, lettering, notice, or device shall be placed in or
upon the Premises including windows, walls, and exterior doors except such
as may be reasonably approved in writing by Landlord.
SPECIFICATIONS
--------------
1. The style, color, and size of the individual company's name shall be
standard and in conformity to the Landlord's reasonable approval.
2. The placement of any sign and or attachment to the Building will be
directed by the Landlord.
3. No electrical or audible signs will be permitted.
4. Except as provided herein, no advertising placards, banners, pennants,
names, insignia trademarks, or other descriptive material shall be affixed
or maintained upon the glass panes, exterior walls, landscaped areas, or
parking areas.
DIRECTORY
---------
1. Each Tenant shall be allowed a space on the building directory sign.
2. Method of attachment, location, color, and size shall be in standard
conformity and shall be up to the Landlord's reasonable approval.
Please contact: Xxxxxxx, XxXxxxxx & Company
0000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
(000)000-0000
EXHIBIT E
RULES AND REGULATIONS
1. No advertisement, sign, lettering, notice, or device shall be placed in or
upon the Premises including windows, walls, and exterior doors except such
as may be approved in writing by Landlord.
2. Lettering upon the directory board and the doors as required by Tenant
shall be made by the sign company designated by Landlord.
3. The entrances, corridors, stairways, and elevators shall not be obstructed
by Tenant, or used for any other purpose than ingress or egress to and from
Premises. Tenant shall not bring into or keep any animal within Building.
4. Tenant will not use or permit to be used in said Premises anything that
will overload any floor or part thereof.
5. Canvassing, soliciting, and peddling in Building are prohibited and each
Tenant shall cooperate to prevent such activity.
6. The requirements of tenants will be attended to only upon application at
the main office of the Landlord's property manager. Landlord's employees
shall not perform any work or do anything outside of their regular duties,
except on issuance of special instructions from Landlord. If Landlord's
employees are made available for the assistance of any tenants, Landlord
shall be paid for their services by such tenants at reasonable hourly
rates.
7. Landlord reserves the right to close and keep locked all Common Area
entrance and exit doors of the Building on Sundays and legal holidays and
between the hours of 6:00 p.m. of any day and 7:00 a.m. of the following
day.
8. Tenant shall exercise care and caution to insure that all water faucets or
water apparatus and electricity are carefully and entirely shut off before
Tenant or its employees leave Building, so as to prevent waste or damage.
Tenant shall be responsible for any damage to Premises or Building and for
all damage or injuries sustained by other tenants or occupants of Building
arising from Tenant's failure to observe this provision.
9. The toilet rooms, urinals, wash bowls, and other apparatus shall not be
used for any purpose other than that for which they were constructed and no
foreign substance of any kind whatsoever shall be thrown therein and the
expense of any breakage, stoppage, or damage resulting from the violation
of this rule shall be borne by the Tenant who, or whose employees or
invitees, shall have caused it.
10. On Saturdays, Sundays, and legal holidays, and on other days between the
hours of 6:00 p.m. and 7:00 a.m. the following day, access to the Building,
or to the halls, corridors, elevators, or stairways in the Building, or to
the Premises may be refused unless the person seeking access is known to
the person or employee of the Building in charge and he has a pass or is
properly identified. The Landlord shall in no case be liable for damages
for any error with regard to the admission to or exclusion from the
Building of any person. In case of invasion, mob, riot, public excitement,
or other commotion, the Landlord reserves the right to prevent access to
the Building during the continuance of the same by closing the doors or
otherwise, for the safety of the Tenants and protection of property in the
Building and the Building.
EXHIBIT F
PREMISES COMPLETION
This Work Letter Agreement, is entered into in conjunction with that certain
lease dated 5/12/98 by and between TMT-Bothell, LLC. ("Landlord") and SonoSight,
Inc. ("Tenant").
RECITALS:
A. Concurrently with the execution of this Work Letter Agreement,
Landlord and Tenant have entered into a lease (the "Lease") covering certain
premises (the "Premises") more particularly described in Exhibit "A" attached to
the Lease.
B. In order to induce Tenant to enter into the Lease (which is hereby
incorporated by reference to the extent that the provisions of this Work Letter
Agreement may apply thereto) and in consideration of the mutual covenants
hereinafter contained, Landlord and Tenant hereby agree as follows:
1. PREMISES IMPROVEMENTS.
Reference herein to "Premises Improvements" shall include (i) that certain
work, to be performed by Landlord at Landlord's expense, consisting of the shell
demising improvements more specifically set forth on Schedule 1 hereto
("Landlord's Work"), which shall be designed and constructed at Landlord's
expense, and (ii) all other work necessary to improve the Premises to Tenant's
desired condition, which work shall be performed by Tenant at Tenant's expense,
subject to the Tenant Improvement Allowance provided herein ("Tenant's Work").
Tenant's Work includes, but is not limited to, those items listed on Schedule 2
hereto.
2. COMPLETION SCHEDULE.
Within ten (10) days after the execution of the Lease, Landlord shall
deliver to Tenant a schedule (the "Work Schedule") setting forth a timetable for
the planning and completion of the installation of the Tenant's Work to be
constructed in the Premises, and the Commencement Date for the term of the
Lease. The Work Schedule shall set forth each of the various items of work to be
done by or approval to be given by Landlord and Tenant in connection with the
completion of the Tenant's Work. Such Schedule shall become the basis for
completing the Tenant Improvement work.
3. PREMISES IMPROVEMENT PLANS.
Immediately after the execution of the Lease, Xxxxxx agrees to meet with
Xxxxxxxx's architect and/or space planner for the purpose of preparing a space
plan for the layout of the Premises. Based upon such space plan, Xxxxxxxx's
architect shall prepare final working drawings and specifications for the
Tenant's Work. Such final working drawings and specifications may be referred to
herein as the "Tenant Work Plans." The Tenant's Work Plans must be consistent
with Landlord's standard specifications (the "Standards") for tenant
improvements for the Building, as the same may be changed from time to time by
Landlord.
4. NON-STANDARD IMPROVEMENTS.
Landlord shall permit Tenant to deviate from the Standards for the Tenant's
Work; provided that (a) the deviations shall not be a lesser quality than the
Standards, (b) the deviations conform to applicable governmental regulations and
necessary governmental permits and approvals have been secured; (c) the
deviations do not require building service beyond the level normally provided to
other tenants in the Building and do not overload the floors; and (d) Landlord
has reasonably determined that the deviations are of a nature and quality that
are consistent with the overall objectives of the Landlord for the Building.
5. FINAL PRICING AND DRAWING SCHEDULE
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After the preparation of the space plan and after Xxxxxx's written approval
thereof, in accordance with the Work Schedule, Landlord shall cause its
architect to prepare and submit to Tenant the final working drawings and
specifications referred to in Paragraph 3 hereof. Such working drawings shall be
approved by Xxxxxxxx and Tenant in accordance with the Work Schedule and shall
thereafter be submitted to the appropriate governmental body by Landlord's
architect for plan checking and the issuance of a building permit. Landlord,
with Tenant's cooperation, shall cause to be made any changes in the plans and
specifications necessary to obtain the building permit. Concurrent with the plan
checking, Landlord shall have prepared a final pricing for Tenant's approval, in
accordance with the Work Schedule, taking into account any modifications which
may be required to reflect changes in the plans and specifications required by
the City or County in which the Premises are located. After final approval of
the working drawings, no further changes to the Tenant Improvement Plans may be
made without the prior written approval from both Landlord and Tenant, and then
only after agreement by Tenant to pay any excess costs resulting from the design
and/or construction of such changes. Tenant hereby acknowledges that any such
changes shall be subject to the terms of Paragraph 7 hereof.
6. CONSTRUCTION OF TENANT'S WORK.
After the Tenant Improvement Plans have been prepared and approved, the
final pricing has been approved and a building permit for the Tenant's Work has
been issued, Landlord shall enter into a construction contract with its
contractor and a construction manager for the installation of the Tenant's Work
in accordance with the Tenant Improvement Plans. Landlord shall supervise the
completion of such work and shall use its best efforts to secure substantial
completion of the work in accordance with the Work Schedule. The cost of such
work shall be paid as provided in Paragraph 7 hereof. Landlord shall not be
liable for any direct or indirect damages as a result of delays in construction
beyond Landlord's reasonable control, including, but not limited to, acts of
God, inability to secure governmental approvals or permits, governmental
restrictions, strikes, availability of materials or labor or delays by Tenant
(or its architect or anyone performing services on behalf of Tenant).
7. PAYMENT OF COST OF THE TENANT'S WORK.
a. Landlord hereby grants to Tenant a "Tenant Allowance" of Two Hundred Eighty
Three Thousand Nine Hundred Forty Eight Dollars ($283,948). Such Tenant
Allowance shall be used only for:
(1) Construction of the Tenant's Work, including, without limitation, the
following:
(a) Installation within the Premises of all partitioning, doors,
floor coverings, ceilings, wall coverings and painting, millwork and similar
items.
(b) All electrical wiring, lighting fixtures, outlets and switches,
and other electrical work to be installed within the Premises.
(c) The furnishing and installation of all duct work, terminal boxes,
diffusers and accessories required for the completion of the heating,
ventilation and air conditioning systems within the Premises, including the cost
of meter and key control for after-hour air conditioning.
(d) Any additional Tenant requirements including, but not limited to,
odor control, special heating, ventilation and air conditioning, noise or
vibration control or other special systems.
(e) All fire and life safely control systems such as fire walls,
sprinklers, halon, fire alarms, including piping, wiring and accessories
installed within the Premises.
(f) All plumbing, fixtures, pipes and accessories to be installed
within the Premises.
(g) Testing and inspection costs.
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(h) Contractor's fees, including but not limited to any fees based on
general conditions.
(3) All other costs to be expended by Landlord in the construction of the
Tenant's Work, including those costs incurred by Landlord for construction of
elements of the Tenant's Work in the Premises.
a. The cost of each item shall be charged against the Tenant
Allowance. In the event that the cost of installing the Tenant's Work, as
established by Xxxxxxxx's final pricing schedule, shall exceed the Tenant
Allowance, or if any of the Tenant's Work are not to be paid out of the Tenant
Allowance as provided above, the excess shall be paid or bonded by Tenant to
Landlord prior to the commencement of construction of the Tenant's Work. The
Tenant Allowance will not be used for the payment of extraordinary design work
not included within the scope of Landlord's building standard improvements or
for payments to any other consultants, designers or architects other than
Xxxxxxxx's architect and/or space planner.
b. In the event that, after the Tenant Improvement Plans have been
prepared and a price therefore established by Landlord, Tenant shall require any
changes or substitutions to the Tenant Improvement Plans, any additional costs
thereof shall be paid by Tenant to Landlord prior to the commencement of such
work. Landlord shall have the right to decline Xxxxxx's request for a change to
the Tenant Improvement Plans if such changes are inconsistent with Paragraph 3
and 4 above, or if the change would, in Landlord's opinion, unreasonably delay
construction of the Premises Improvements.
c. In the event that the cost of the Tenant's Work increases as set
forth in Landlord's final pricing due to the requirements of any governmental
agency, Tenant shall pay Landlord the amount of such increase within five (5)
days of Landlord's written notice; provided, however, that Landlord shall first
apply toward such increase any remaining balance in the Tenant Allowance.
d. In addition to providing the Tenant Improvement Allowance,
Landlord shall contract for and pay for the reasonable cost of preparation of
space plans and Xxxxxx's Work Plans for Tenant's Work and the permit for
Xxxxxx's Work.
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