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EXHIBIT 10.31
MILLENNIUM CORPORATE PARK
LEASE AGREEMENT
REDMOND, WASHINGTON
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THIS LEASE is made the 11th day of December, 1997, between MILLENNIUM
CORPORATE PARK L.L.C., A WASHINGTON LIMITED LIABILITY COMPANY (the "Landlord"),
and MOSAIX, INC., a Washington corporation (the "Tenant").
RECITALS
(A) Capitalized terms used herein are defined in Article 20 of this
Lease.
(B) The Landlord is the owner of the Lands, subject however to existing
liens and encumbrances of record, and has constructed, or is in the process of
constructing, improvements thereon, including the Building generally in
accordance with the plans set forth in SCHEDULE "A".
(C) The Landlord and the Tenant desire to enter into a lease with
respect to the Leased Premises.
NOW THEREFORE in consideration of the rents, covenants and
agreements hereinafter reserved and contained, the parties agree to this Lease
of the Leased Premises on the terms and conditions set forth herein:
BASIC TERMS
.01 AREA OF LEASED PREMISES: All of Building C, consisting of
approximately 102,594 square feet. The
actual Area of the Leased Premises shall be
measured in accordance with BOMA (as defined
in Section 20.02) by Landlord's Architect
following completion of the Building shell
and the Monthly Rent and other charges due
from Tenant under this Lease shall be based
on such actual measurement.
.02 BASIC TRIPLE NET RENT: Monthly Rate
Months Per Square Foot Monthly Rent
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Commencement Date
through
February 28, 1999 $1.13 $115,931.22
March 1, 1999 through
February 28, 2002 $1.13 $115,931.22
March 1, 2002 through
February 28, 2005 $1.20 $123,112.80
March 1, 2005 through
February 28, 2009 $1.35 $138,501.90
.03 PERMITTED USE: General office use.
.04 TERM: Commencement Date through February 28, 2009, with two (2)
options to renew pursuant to Article 1.02 below.
.05 SECURITY DEPOSIT: $0.00
The foregoing Basic Terms are agreed to by the Landlord and the Tenant
and any reference in this Lease to any one of the same shall include the
provisions set forth above with respect thereto and in addition any more
specific definition or reference hereinafter provided.
ARTICLE I
DEMISE AND TERM
1.01 DEMISE AND TERM
The Landlord does hereby demise and lease unto the Tenant the Leased
Premises to have and to hold for and during the Term. For so long as the Tenant
duly and punctually pays the Rent, and performs and observes its covenants
herein undertaken, the Tenant shall be entitled for the benefit of the Leased
Premises to enjoy, upon the terms and conditions established or altered pursuant
to this Lease, the use in common with others entitled thereto of the Common
Areas and the Common Facilities.
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1.02 OPTION TO RENEW TERM.
(a) OPTION GRANTED. Provided Tenant is not in default under this Lease,
and subject to the conditions described in this Article, Tenant shall have the
option to renew the Term of this Lease for two (2) consecutive periods of three
(3) to five (5) years each (such renewal periods are hereinafter referred to as
a "Renewal Term" or as the "First Renewal Term" and the "Second Renewal Term").
The First Renewal Term shall commence immediately following the expiration of
the Term and the Second Renewal Term shall commence immediately following the
expiration of the First Renewal Term.
(b) EXERCISE OF OPTION. With respect to the First Renewal Term, Tenant
shall exercise its option to renew, if at all, by giving Landlord written notice
(the "First Exercise Notice") of Tenant's intention to do so at least nine (9)
months prior to the expiration of the Term. The First Exercise Notice shall set
forth the duration of the First Renewal Term, which shall be a minimum of three
(3) years and a maximum of five (5) years. With respect to the Second Renewal
Term, Tenant shall exercise its option, if at all, by giving Landlord written
notice (the "Second Exercise Notice") of Tenant's intention to do so at least
nine (9) months prior to the expiration of the First Renewal Term. The Second
Exercise Notice shall set forth the duration of the Second Renewal Term, which
shall be a minimum of three (3) years and a maximum of five (5) years. In the
event Tenant fails to timely exercise its renewal option for either the First
Renewal Term or the Second Renewal Term, this Article 1.02 shall be considered
null and void and of no further force and effect. If Tenant is in default under
this Lease, Tenant shall have no right to renew the term of this Lease;
provided, that the period of time within which said option may be exercised
shall not be extended or enlarged by reason of Tenant's inability to exercise
said option because of a default.
(c) TERMS OF RENEWAL. In the event Tenant validly exercises its option
to renew the Term as herein provided, Tenant's lease of the Leased Premises for
each Renewal Term shall be on the same terms and conditions contained in the
Lease, except that (i) Basic Triple Net Rent for each Renewal Term shall be as
set forth hereinbelow, (ii) there shall be no allowances, commissions, or other
concessions paid by Landlord except as otherwise provided for herein and
expressly made applicable to a Renewal Term, and (iii) no additional options to
renew shall apply following the expiration of the Second Renewal Term. Basic
Triple Net Rent shall be adjusted as of the commencement date of each applicable
Renewal Term as follows:
(1) Landlord shall notify Tenant in writing (the "Option Rent
Proposal") within fifteen (15) days after receipt of the applicable Exercise
Notice of the Basic Triple Net Rent for which Landlord is willing to lease the
Premises during the applicable Renewal Term, and any new or revised Lease
provisions which Landlord is then using in Landlord's standard lease form and
which Landlord wishes to include in the Renewal Term lease (the "New Terms").
The rental rate quoted in the Option Rent Proposal shall be based on the then
"Prevailing Market Rental Rate" as defined hereinafter.
(2) Upon receipt of the Option Rent Proposal, Tenant shall have an
additional fifteen (15) days during which to notify Landlord in writing (the
"Option Rent Acceptance Notice") that Tenant elects to exercise the applicable
renewal option and lease the Premises for the applicable Renewal Term at the
Basic Triple Net Rent and upon New Terms presented by Landlord in the Option
Rent Proposal.
(3) Notwithstanding subsection (2) above to the contrary, Tenant may
during the fifteen (15) days after the receipt of Option Rent Notice submit in
writing ("Option Rent Counter Proposal") to Landlord notice of the Basic Triple
Net Rent Tenant is willing to lease the Premises for with respect to the
applicable Renewal Term and any comments Tenant may have on the New Terms as
presented by Landlord. The rental rate contained in the Option Rent Counter
Proposal shall be based on the then Prevailing Market Rental Rate as defined
hereinafter. In the event Tenant submits an Option Rent Counter Proposal,
Landlord and Tenant shall attempt to agree upon the Basic Triple Net Rent and
New Terms for the applicable Renewal Term within an additional thirty (30) days
from the receipt of the Option Rent Counter Proposal. If Landlord and Tenant are
successful in agreeing on Basic Triple Net Rent and New Terms within the said
thirty (30) day period, Tenant then shall submit an Option Rent Acceptance
Notice to Landlord reflecting such amount and New Terms as agreed. If Landlord
and Tenant fail to agree upon the Basic Triple Net Rent and New Terms within
said thirty (30) day period, and provided that Tenant has not exercised its
Contraction Option under Section 1.04 below and will be occupying the entire
Leased Premises initially leased under this Lease during the applicable Renewal
Term, such Basic Triple Net Rent and terms shall be determined pursuant to
subsection 1.02(c)(4) below. If Tenant will be occupying less than the entire
Leased Premises initially leased under this Lease during the applicable Renewal
Term and Tenant has not exercised its Contraction Option under Section 1.04
below and Landlord and Tenant fail to agree upon the Basic Triple Net Rent and
New Terms within said thirty (30) day period, Tenant shall be deemed to have
elected to relinquish its option to renew for the applicable Renewal Term and
all other rights under this Article 1.02, and this Lease shall terminate upon
the original termination date.
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(4) Within ten (10) days after the expiration of the thirty (30) day
period set forth in the previous sentence, each party, at its own cost and by
giving notice to the other party, shall appoint a real estate appraiser with at
least five (5) years full-time commercial real estate appraisal experience in
the area in which the Leased Premises are located to set Basic Triple Net Rent
and establish the New Terms for the applicable Renewal Term. If a party does not
appoint an appraiser within ten (10) days after the other party has given notice
of the name of its appraiser, the single appraiser appointed shall be the sole
appraiser and shall set Basic Triple Net Rent and the New Terms for the
applicable Renewal Term. If each party shall have so appointed an appraiser, the
two appraisers shall meet promptly and attempt to set the Basic Triple Net Rent
and New Terms for the applicable Renewal Term. The Basic Triple Net Rent shall
be based on the Prevailing Market Rental Rate. If the two appraisers are unable
to agree within ten (10) days after the second appraiser has been appointed,
they shall attempt to select a third appraiser meeting the qualifications herein
stated within ten (10) days after the last day the two appraisers are given to
set Basic Triple Net Rent and New Terms. If the two appraisers are unable to
agree on the third appraiser within such ten (10) day period, either of the
parties to this Lease, by giving five (5) days notice to the other party, may
apply to the then presiding judge of the Superior Court of King County for the
selection of a third appraiser meeting the qualifications stated in this
paragraph. Each of the parties shall bear one-half (1/2) of the cost of
appointing the third appraiser and of paying the third appraiser's fee. The
third appraiser, however selected, shall be a person who has not previously
acted in any capacity for either party. Within ten (10) days after the selection
of the third appraiser, a majority of the appraisers shall set Basic Triple Net
Rent and New Terms for the applicable Renewal Term. If a majority of the
appraisers are unable to agree upon the Basic Triple Net Rent and New Terms
within the stipulated period of time, the three appraisals shall be added
together and their total divided by three (3). The resulting quotient shall be
the Basic Triple Net Rent for the Leased Premises during the applicable Renewal
Term. If, however, the low appraisal and/or the high appraisal is/are more than
five percent (5%) lower and/or higher than the middle appraisal, the low
appraisal and/or the high appraisal shall be disregarded. If only one (1)
appraisal is disregarded, the remaining two (2) appraisals shall be added
together and their total divided by two (2), and the resulting quotient shall be
Basic Triple Net Rent for the Leased Premises during the applicable Renewal
Term. If the appraisers are unable to agree on all of the New Terms, such New
Terms as are agreed upon, if any, shall be applicable for the Renewal Term.
(5) The term "Prevailing Market Rental Rate" as used in this Article
1.02 shall mean rental rates that a majority of landlords in the area, whose
ownership status are similar to the Landlord, are willing to lease premises that
are in comparable condition and location with the Premises, to tenants of
similar financial and credit worthiness as Tenant, for a similar term of the
lease, as of the applicable Renewal Term commencement date if such premises were
exposed for lease on the open market for a reasonable period of time. Rental
rates quoted or used under sublease agreements or predetermined option rights
shall be considered rates of special circumstances and shall be excluded from
the definition of the Prevailing Market Rental Rate under this Article 1.02.
(6) Notwithstanding anything to the contrary provided in this
Article 1.02, if Landlord and Tenant fail to agree on the Basic Triple Net Rent
and other terms for the applicable Renewal Term within the thirty (30) day
period set forth in subsection (3) above, Landlord shall have the right to
actively market the Premises to any potential third party tenants.
(d) OPTION PERSONAL TO TENANT. The renewal option set forth in this
Article 1.02 is granted for Tenant's personal benefit and may not be assigned or
transferred by Tenant, either voluntarily or by operation of law, in any manner
whatsoever. In the event that Landlord consents to a sublease or assignment
under this Lease, the renewal option granted hereunder shall be void and of no
further force and effect, whether or not Tenant shall have purported to exercise
the renewal option prior to such assignment or sublease.
(e) AMENDMENT TO LEASE. In the event Tenant timely and properly
exercises the renewal option, Landlord and Tenant shall within fifteen (15) days
after the determination of Basic Triple Net Rent and the New Terms for the
applicable Renewal Term execute an amendment to this Lease extending the Term
for the applicable Renewal Term at the established Basic Triple Net Rent and on
the New Terms agreed upon or, if applicable, as determined by the appraisers.
1.03 RIGHT OF FIRST REFUSAL
(a) GRANT OF RIGHT. Landlord agrees that, to the extent that portions of
the 25,000 square feet of space located on the first (1st) floor of Building B
in the location shown on SCHEDULE A-2 become available to lease during the first
thirty-six (36) months of the Term, prior to leasing any portion of the space
(each such portion being referred to as "Right of First Refusal Space") to a
third party, Landlord shall notify Tenant in writing that Landlord has received
an offer to lease a portion of the Right of First Refusal Space from a third
party (the "Offer") and Tenant shall have the right (each, a "Right of First
Refusal") to rent the Right of First Refusal Space on the terms set forth in
this Article 1.03.
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(b) EXERCISE OF RIGHT OF FIRST REFUSAL. Provided that Tenant is not then
in default hereunder, Tenant may exercise the Right of First Refusal by sending
Landlord, within five (5) days of receipt by Tenant of the Offer, a notice
stating that Tenant elects to rent the Right of First Refusal Space upon the
terms and conditions set forth in this Article 1.03. If Tenant duly and timely
exercises the Right of First Refusal, Landlord and Tenant shall promptly enter
into an amendment to this Lease incorporating the Right of First Refusal Space
upon the terms set forth in this Article 1.03. If for any reason Tenant fails to
duly and timely exercise its Right of First Refusal, or if Tenant properly
exercises such right but thereafter does not enter into an amendment within ten
(10) days after Landlord delivers such amendment, Landlord shall be free to
lease the Right of First Refusal Space to any third party on the terms of the
Offer. Should Landlord not lease the Right of First Refusal Space to a third
party on the Offer terms, or if the Right of First Refusal Space leased to a
third party in accordance with this provision becomes available again during the
Term, Tenant's Right of First Refusal shall continue in accordance with the
foregoing provisions for the first thirty-six (36) months of the Term, upon
which date this Right of First Refusal shall expire. Each Right of First Refusal
shall, at Landlord's election, be null and void if Tenant is in default under
this Lease at the date Landlord would otherwise notify Tenant of the Offer or at
any time thereafter and prior to commencement of Tenant's lease of the Right of
First Refusal Space.
(c) TERMS OF RIGHT OF FIRST REFUSAL SPACE. Tenant's lease of the
Right of First Refusal Space shall be on terms identical to those set forth in
this Lease, except that (i) the lease term for such Right of First Refusal Space
shall be co-terminus with the Term (including any renewal options) of this
Lease, (ii) Basic Triple Net Rent for the Right of First Refusal Space shall be
at the per rentable square foot rate in effect under this Lease during the term
of Tenant's lease of such Right of First Refusal Space, (iii) notwithstanding
anything to the contrary in the Offer, Tenant shall lease the greater of (1)
5,000 square feet of the Right of First Refusal Space, or (2) a minimum of 75%
of the amount of Right of First Refusal Space covered by the Offer, (plus any
applicable load factor) each time it exercises a Right of First Refusal, and
(iv) other than the "Right of First Refusal Space Allowance" set forth below,
there shall be no concessions with respect to the Right of First Refusal Space
including, without limitation, free rent, allowances, or leasing commissions, or
other concessions made by the Landlord initially with respect to this Lease
except as otherwise provided for herein and expressly made applicable to the
Right of First Refusal Space. If Tenant duly and timely exercises its Right of
First Refusal, Landlord shall provide Tenant with an allowance (the "Right of
First Refusal Space Allowance") equal to $31.00 per useable square foot of Right
of First Refusal Space leased by Tenant. The Right of First Refusal Space
Allowance shall be used solely for the design and construction of permanently
affixed tenant improvements to the Right of First Refusal Space. Any tenant
improvements to the Right of First Refusal Space shall be constructed by
Landlord in accordance with the provisions set forth on Schedule B with respect
to the construction of the initial Tenant Improvements.
(d) RIGHT PERSONAL TO TENANT. The Right of First Refusal set
forth in this Article 1.03 is granted for Tenant's personal benefit and may not
be assigned or transferred by Tenant, either voluntarily or by operation of law,
in any manner whatsoever. In the event that Landlord consents to a sublease or
assignment under this Lease, the Right of First Refusal granted hereunder shall
be void and of no further force and effect, except to the extent that Tenant
then occupies Right of First Refusal Space.
1.04 CONTRACTION OPTION.
(a) OPTION GRANTED. Subject to the conditions set forth in this Article
1.04, Tenant shall have the one-time option to terminate this Lease with respect
to a portion of the Leased Premises (the "Contraction Option") effective on the
fifth (5th) anniversary of the Commencement Date (the "Contraction Date").
(b) CONDITIONS. Tenant's Contraction Option shall be subject to Tenant
satisfying the following conditions:
(1) Tenant shall give Landlord at least nine (9) months prior
written notice (the "Contraction Notice") of its election to exercise the
Contraction Option. The Contraction Notice shall contain a floor plan showing
the proposed space to be returned (the "Released Space") and an estimate of the
rentable square footage of such Released Space.
(2) On or before the date which is ninety (90) days prior to the
Contraction Date, Tenant shall pay to Landlord a fee equal to Landlord's
reasonable determination of a pro rata share of the unamortized portion of all
leasing commissions, tenant improvement costs, all other allowances, and
concessions granted or paid by Landlord under this Lease as of the Contraction
Date. Such pro rata share shall be based on the size of the Released Space.
(3) The Released Space shall be contiguous space of not less than
5,000 rentable square feet and not more than 20,000 rentable square feet.
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(4) The Released Space shall be in a location reasonably acceptable
to Landlord and, at a minimum, shall (A) have access to a common corridor, (B)
have reasonable access to Common Areas and Common Area Facilities, and (C) be
space that a reasonable tenant and a reasonable landlord would consider leasing,
taking into account such factors as space configuration.
(5) At least ninety (90) days prior to the Contraction Date,
Landlord and its contractors shall have access to the Leased Premises for the
purpose of planning any necessary demising walls, doors, or other necessary
modifications to segregate the Released Space from the Leased Premises.
(6) The Contraction Option shall be void if Tenant is in default
under the Lease at the time Tenant exercises its Contraction Option or on the
Contraction Date.
(c) TERMS OF REMAINING LEASED PREMISES. Provided that the conditions
set forth in subsection (b) above are met, effective on the Contraction Date,
all Lease terms shall remain in effect except that (1) the Leased Premises shall
consist of the Leased Premises minus the Released Space, and (2) Basic Triple
Net Rent and Additional Rent shall be reduced proportionately to reflect the
removal of the Released Space from the Leased Premises.
(d) AMENDMENT TO LEASE. In the event Tenant timely and properly
exercises the Contraction Option, Landlord and Tenant shall within sixty (60)
days after receipt of the Contraction Notice by Landlord sign an amendment to
this Lease confirming the size of the Released Space, the size of the remaining
Leased Premises, the Basic Triple Net Rent and Additional Rent applicable to the
remaining Leased Premises, and any other terms related to the downsizing that
either party reasonably requests.
1.05 SURRENDER OF LEASED PREMISES
Upon the expiration or sooner termination of this Lease, the Tenant
shall vacate and surrender to the Landlord the Leased Premises in accordance
with the provisions of this Lease. Except to the extent as otherwise expressly
agreed by the Landlord in writing, no leasehold improvements shall be removed by
the Tenant from the Leased Premises either during or at the expiration or sooner
termination of the Term except that the Tenant shall at the end of the Term
remove such leasehold improvements as the Landlord shall require to be removed
together with all of Tenant's trade fixtures, furnishings, equipment and
inventory and special improvements installed by Tenant following the initial
build-out of the Leased Premises.
The Tenant shall, in the case of every installation and removal of any
improvements, trade fixtures, furniture or equipment, either during or at the
end of the Term, make good any damage caused to the Leased Premises and any
leasehold improvements therein by such installation and removal.
ARTICLE 2
RENT
2.01 BASIC TRIPLE NET RENT
The Tenant shall pay to the Landlord for the Term the Basic Triple Net
Rent specified in Basic Term .02 in advance on the first day of each and every
month during the Term. The first monthly payment shall be paid on the
Commencement Date. If the Term commences on a day which is not the first day of
a calendar month, then the first payment of Basic Triple Net Rent payable on the
broken portion of a calendar month at the beginning of the Term shall be pro
rated on a daily basis.
2.02 Additional Rent
The Tenant shall pay to the Landlord for each and every Lease Year or
portion thereof, the Additional Rent for such Lease Year or portion thereof. The
amount of Additional Rent which the Tenant is to pay in each Lease Year or
portion thereof shall be estimated by the Landlord in advance and the Tenant
shall pay to the Landlord such amount in equal monthly payments in advance
during such Lease Year or the portion thereof. The amount of the estimated
Additional Rent may be adjusted, from time to time, during a Lease Year by the
Landlord giving notice to the Tenant, in which event the remaining payments to
be made by the Tenant as aforesaid in such Lease Year shall be adjusted
accordingly. All remedies of the Landlord on non-payment of rent shall be
applicable to the Additional Rent and the obligation of the Tenant to pay any
monies pursuant to this Lease shall survive the expiration or sooner termination
of this Lease. Notwithstanding the above provisions to the contrary, Tenant
shall not be obligated to pay increases in the Controllable Costs above twelve
percent (12%) per year following the first full calendar year of the Term.
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2.03 ADJUSTMENT OF ADDITIONAL RENT
Within ninety (90) days after the end of each Lease Year, the Landlord
shall furnish to the Tenant a statement of the actual amount of Additional Rent
payable by the Tenant for such preceding Lease Year and showing in reasonable
detail the information relevant and necessary to the calculation thereof. If the
amount payable by the Tenant as shown on such statement is more or less than the
Additional Rent paid by the Tenant to the Landlord for such Lease Year pursuant
to Article 2.02, the appropriate adjustment as between the Landlord and the
Tenant shall be made within fourteen (14) days of delivery of such statement.
Any payment made by the Landlord or made by the Tenant and accepted by the
Landlord in respect of any adjustment made pursuant to this Article 2.03 shall
be without prejudice to the right of the Landlord or the Tenant to claim a
re-adjustment provided such claim if made by the Tenant is made within ninety
(90) days after, or if made by the Landlord is made within one hundred twenty
(120) days after, the date of delivery of the statement referred to in this
Article 2.03. The Tenant shall have the right for a period of ninety (90) days
following receipt of the aforesaid statement to, at its sole expense, inspect
during the Landlord's normal business hours, subject to the inspection being
reasonable in all the circumstances, any record kept or held by the Landlord of
the costs or expenses claimed by the Landlord for such Lease Year and the
Landlord shall make its said records available accordingly.
2.04 MANNER AND PLACE OF PAYMENT
All Rent and all other sums payable by the Tenant to the Landlord
hereunder shall be paid to the Landlord at the office of the Landlord
hereinafter set forth, or at such other place as the Landlord may in writing,
from time to time, direct without notice or demand, except as otherwise
specifically provided herein, and without deduction, set off or abatement for
any reason whatsoever. The Landlord may at its option apply all or any sums
received from or due to the Tenant against amounts due and payable by the Tenant
hereunder in such manner as the Landlord sees fit, regardless of any designation
or instructions by the Tenant to the contrary. If Tenant fails to pay when due
any Rent, Additional Rent, or any other sum, such unpaid amount will bear
interest at the rate equal to the Prime Rate plus five percent per annum (but no
more than the maximum rate permitted by law) from the due date until paid. In
addition, Tenant acknowledges that the late payment by Tenant of any payment of
Rent, Additional Rent or of any other sum due to Landlord will cause Landlord to
incur certain costs and expenses not contemplated under this Lease, the exact
amount of these costs being extremely difficult and impractical to ascertain.
These costs include processing and accounting expenses and late charges which
may be imposed on Landlord by its lender. Therefore, if any sum due from Tenant
is not received by Landlord within 10 days after notice from Landlord that such
sum is due, Tenant shall pay Landlord a late charge equal to three percent of
the late payment or $100, whichever is greater. If any such sum is not received
by Landlord within 20 days after notice from Landlord, the amount of the late
charge paid by Tenant shall be five percent of the late payment or $175,
whichever is greater. If any such sum is not received by Landlord within 30 days
after notice from Landlord, the amount of the late charge to be paid by Tenant
shall be seven percent of the late payment or $300, whichever is greater. The
parties agree these late charges represent a reasonable estimate of the costs
that Landlord will incur by reason of Tenant's late payment.
2.05 IRREGULAR CALCULATION OF BASIC TRIPLE NET RENT
If for any reason it becomes necessary to calculate Basic Triple Net
Rent for a period of less than one month the same shall be pro rated on a daily
basis based on the number of days in the applicable month.
2.06 DISPROPORTIONATE ALLOCATION
Notwithstanding anything else herein otherwise contained, to the extent
that the Landlord, acting reasonably, determines that an item included in
Additional Rent properly related to only a portion of the Development or to a
portion of the Building, the Landlord may allocate such item to such portion of
the Development or Building, as the case may be, in which event the Tenant's
Proportionate Share, if the Leased Premises are within such portion, shall be
calculated in relation to the Gross Rentable Area of all leasable premises in
such portion.
2.07 NET LEASE INTENT
Except to that extent otherwise specifically provided herein this Lease
shall be a net lease to the Landlord such that the Basic Triple Net Rent shall
be received by the Landlord free of all expenses whatsoever, it being the intent
that the Tenant shall pay for its own account all amounts, charges, costs,
duties, fees, rates and taxes in any way relating to the Leased Premises as well
as the Additional Rent herein provided.
2.08 SECURITY DEPOSIT. INTENTIONALLY DELETED.
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ARTICLE 3
CONSTRUCTION AND FIXTURING OF LEASED PREMISES
3.01 LANDLORD'S WORK AND TENANT IMPROVEMENTS
Landlord shall complete the base, shell and core of the Building (the
"Landlord's Work"). All improvements to the Leased Premises not included in
Landlord's Work (the "Tenant Improvements") shall be constructed by Landlord or
Landlord's contractor pursuant to the provisions of SCHEDULE "B" hereto. Except
to the extent that the Building core work is included in the description of
Tenant Improvements on Schedule "B", the Landlord's Work shall be performed at
Landlord's expense.
3.02 COMMENCEMENT OF THE CONSTRUCTION
If, at any time prior to the commencement of construction of the
Building or the Development, the Landlord is in its opinion unable to obtain
satisfactory government approvals including, without limiting the generality of
the foregoing, development permits or building permits, with respect to the
Building or the Development, then the Landlord shall have the right and option
at any time thereafter to cancel this Lease and in such event, any money or
security deposited hereunder shall be returned to the Tenant without interest,
this Lease shall thereafter be null and void and neither party shall have any
further claim, the one against the other.
3.03 PAYMENT FOR OTHER WORK
All work done at the Tenant's request over and above the Tenant
Improvements (including the supplying of materials or equipment) by the Landlord
or its contractors or sub-contractors in or relating to the Leased Premises
shall be paid for by the Tenant within thirty (30) days of Landlord's request
for payment.
3.04 ACCEPTANCE OF LEASED PREMISES
The taking of possession of the Leased Premises by the Tenant shall be
deemed to be conclusive proof that except for items noted in a "punch-list"
prepared by the Tenant during a joint inspection by the Tenant and the Landlord
at the time of the taking of such possession, the Leased Premises are in the
condition called for by this Lease to the extent that the Landlord is
responsible therefor and that the Landlord has performed all of the Landlord's
Work and Tenant Improvements with respect thereto in a good and workmanlike
manner and Tenant has accepted the Leased Premises in "as is" condition. The
itemizing of any matter in such list by the Tenant shall not preclude the
Landlord from disputing the categorization of such matter as a deficiency.
ARTICLE 4
CONDUCT OF BUSINESS
4.01 USE OF LEASED PREMISES
The Tenant shall not use or occupy the Leased Premises or any part
thereof for any purpose other than the Permitted Use without first obtaining the
written consent of the Landlord. Tenant represents and warrants to Landlord that
the Permitted Use is a lawful and permitted use under the zoning code of the
City of Xxxxxxx.
4.02 PROHIBITED USES
The Tenant shall not, at any time, carry on nor cause, permit or allow
to be carried on in the Leased Premises any fire sale, distress sale, bankruptcy
sale, going-out-of-business sale, or any other business sale designed to convey
to the public that business operations are to be discontinued, an auction, a
pawn business, a mail order business or any other business which because of the
merchandise likely to be sold or the merchandising or pricing methods likely to
be used would, in the reasonable opinion of the Landlord, tend to lower the
character of the Development.
4.03 OPERATIONS DURING THE TERM
The Tenant acknowledges that its continued occupancy of the Leased
Premises and the regular conduct of its business therein are of the utmost
importance to the Landlord in avoiding the appearance and impression generally
created by vacant space in a development, in facilitating the leasing of vacant
space, and in the renewal of other leases, and that the Landlord will suffer
substantial damage if the Leased Premises are vacated or left vacant during the
Term even if Basic Triple Net Rent is paid.
The Tenant shall on the Commencement Date commence and thereafter during
the Term, actively and diligently carry on in the Leased Premises the business
specified as the Permitted Use, and
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shall without limiting the generality of the foregoing, conduct its business in
the entire Leased Premises. The Tenant will not during the Term vacate or
abandon the Leased Premises either in full or in part.
4.04 SIGNS
The Tenant shall not erect or place, or cause or allow to be erected or
placed or maintain any signs of any nature or kind whatsoever either on the
exterior walls of the Leased Premises or elsewhere in the Development. The
Tenant shall not erect or place or cause or allow to be erected or placed in the
windows of the Leased Premises, any signs, decoration, lettering or advertising
matter of any kind (including signs placed in the interior of the Leased
Premises for exterior view). Notwithstanding the above to the contrary, Landlord
will install appropriate location and direction signs, two (2) exterior signs on
the Building, and an entrance monument sign adjacent to Building C with Tenant's
name on it, with a design to be agreed upon between Landlord and Tenant and of
sizes and in locations acceptable to Landlord in Landlord's discretion. Landlord
shall have the right, at the expiration of the Term or such shorter period to
which the approval relates, to remove all of Tenant's signage at Tenant's sole
cost and expense. Landlord will obtain all necessary approvals from the City of
Xxxxxxx with respect to any sign of Tenant installed in the Development.
4.05 NUISANCE AND ANNOYANCE
The Tenant shall not use or occupy the Leased Premises or cause or
permit the same to be used or occupied for any unlawful purpose, or for any
dangerous, noxious or offensive trade or business, or for any purpose likely to
cause a nuisance or annoyance to the Landlord or any other tenants of the
Development nor undertake any operation likely to cause the same, nor commit or
cause to be done any waste, damage or disfigurement or injury to the Development
or any part thereof nor permit or cause the overloading of any floors therein.
4.06 DELIVERY OF SUPPLIES AND MATERIALS
The delivery and shipping of merchandise, supplies, fixtures and other
materials or goods of whatsoever nature to or from the Leased Premises and all
loading, unloading and handling thereof shall be done through such entrances as
designated by the Landlord.
4.07 ORDINANCES AND REGULATIONS
The Tenant shall, at Tenant's expense, observe and fulfill the
provisions and requirements of all statutes, ordinances, laws, rules and
regulations now in force or which may hereafter be in force, relating directly
or indirectly to the use or occupancy of the Leased Premises and shall comply
with all reasonable requirements of any insurer under any policy of insurance
affecting the Development.
4.08 RULES AND REGULATIONS
The Tenant shall observe and comply with and use its best efforts to
cause its employees, agents, licensees and invitees to observe and comply with
any and all rules and regulations communicated by the Landlord to the Tenant
(including the Rules and Regulations attached hereto as SCHEDULE "C"), from time
to time, which in the judgment of the Landlord are necessary or desirable in
relation to all aspects of the use and occupancy by the Tenant of the Leased
Premises, the Building, the Common Areas and the Common Facilities including for
the reputation, care, safety and appearance of the Development, the preservation
of good order therein and the operation and maintenance thereof, provided that
such rules and regulations do not conflict with any express provisions of this
Lease and are not discriminatory against the Tenant. The Tenant specifically
acknowledges that the Landlord has and shall have the right to make rules and
regulations as aforesaid.
ARTICLE 5
REPAIRS
5.01 TENANT'S REPAIRS
Except for repairs which are the Landlord's responsibility pursuant to
Article 5.06 below (including all repairs to the heating, ventilating and
air-conditioning systems), the Tenant shall at all times during the Term, at its
own cost and expense, repair, maintain, operate and keep the Leased Premises,
all equipment, fixtures, plumbing and electrical systems installed within the
Leased Premises by or for the sole use of the Tenant, and any improvements now
or hereafter made to the Leased Premises in good order, first class condition
and repair (reasonable wear and tear excepted). The Tenant shall be responsible
for all janitorial services respecting the Leased Premises (including the
washing of the inside of windows therein) so as to keep the Leased Premises in a
clean and tidy condition. Tenant may request that repairs or maintenance
required under this Article 5.01 be performed by Landlord and, if Landlord
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elects to perform repairs or maintenance requested by Tenant, the costs and
expenses thereof shall be paid by Tenant to Landlord as Additional Rent within
ten (10) days of Landlord's request for payment.
5.02 PERIMETER WALLS AND GLASS
The Tenant shall promptly repair or make whole all damaged glass, plate
glass, doors, windows, and perimeter walls in the Leased Premises as and
whenever the same is required if the damage is caused by the negligent act or
omission of Tenant.
5.03 LANDLORD'S EXAMINATION OF LEASED PREMISES
The Landlord and any employee, agent or contractor of the Landlord shall
be entitled, upon reasonable advance notice, at any time during normal business
hours and at any time without notice in the event of an emergency, to enter and
examine the state of maintenance, repair, decoration and cleanliness of the
Leased Premises, all equipment and fixtures within the Leased Premises and any
improvements now or hereafter made to the Leased Premises and the Landlord may
give notice to the Tenant requiring that the Tenant perform such maintenance or
effect such repairs, replacements or decoration or cleaning as is the
responsibility of the Tenant and as may be found necessary from such
examination.
5.04 LANDLORD'S RIGHT TO REPAIR
In the event that the Tenant fails forthwith after receipt of written
notice thereof, or within such reasonable time thereafter if for any cause
beyond the control of the Tenant it is not reasonable in the circumstances (it
being agreed that lack of finances on the part of the Tenant shall not be
treated as a cause beyond the Tenant's control), to commence and diligently
proceed to perform such maintenance or effect such repairs, replacements,
decorations or cleaning as so specified in any notice given by the Landlord, the
Landlord, its employees, agents or contractors may, but shall not be obligated
to, enter the Leased Premises and at the Tenant's expense, perform and carry out
the same and the Landlord in so doing shall not be liable for inconvenience,
disturbance, loss of business or other damage resulting therefrom and in the
event the Landlord expends any monies pursuant to the provisions of this Article
5.04, the Tenant shall pay the same to the Landlord on demand with a fee of
twenty (20%) percent of such amount for the Landlord's supervisory function and
in addition shall pay interest on the aggregate of the foregoing at the rate
provided in this Lease from the date of the expenditure of such first mentioned
monies by the Landlord.
5.05 LANDLORD'S RIGHT TO ENTER FOR OTHER REPAIRS
The Landlord, and any employee, agent or contractor of the Landlord
shall have the right to enter the Leased Premises at all times during business
hours and at any time in the case of an emergency to make such alterations or
repairs as the Landlord is required to make pursuant to the terms of this Lease
or shall deem necessary for the safety, preservation, proper administration or
improvement of the Development or any portion thereof and the Landlord in so
doing, shall not be liable for inconvenience, disturbance, loss of business or
other damage resulting therefrom except to the extent caused by the negligence
of Landlord or any employee, agent or contractor of Landlord.
5.06 LANDLORD'S REPAIRS
The Landlord shall, from time to time, throughout the Term:
(a) carry out necessary repairs to the structural portions of the
Building including the foundations, exterior walls, structural
subfloors, the structural portions of bearing walls and
structural columns and beams;
(b) carry out repairs or replacements to the Common Areas and the
Common Facilities, including the heating, ventilating and
air-conditioning systems forming part of the Common Facilities;
(c) repair and maintain the heating, ventilating and
air-conditioning systems and other building standard equipment
and systems within or serving the Leased Premises (excluding
plumbing and electrical systems installed within the Leased
Premises by or for the sole use of the Tenant) and the costs
thereof shall form part of the HVAC Costs or Building Operation
and Maintenance Costs, as the case may be hereunder; and
(d) repair all damage to the Leased Premises which is covered by any
insurance effected by the Landlord in accordance with the
provisions of Article 8.03 hereof to the extent of the proceeds
of such insurance applicable thereto;
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PROVIDED HOWEVER that if any such repairs are necessitated by the
negligence or misconduct of the Tenant, its agents, contractors, licensees,
employees or others for whom in law the Tenant is responsible, the Tenant shall
pay to the Landlord on demand the cost of such repairs and a fee of two and
one-half percent (21/2%) for the Landlord's supervisory function and interest on
the aggregate amount of both of the foregoing from the date of expenditure of
the first mentioned monies by the Landlord.
PROVIDED FURTHER that in any event the Landlord shall not be responsible
for any damages, loss or injury sustained by the Tenant or any person or persons
claiming through or under it, by reason of defects giving rise to the need for
such repairs or the consequence thereof, including the inconvenience occasioned
to the Tenant by the entry of the Landlord, its employees, agents, or
contractors on the Leased Premises to effect such repairs except to the extent
caused by the negligence of Landlord or any employee, agent or contractor of
Landlord.
5.07 LANDLORD'S OBLIGATION TO MAINTAIN
The Landlord shall maintain and keep the Common Areas and the Common
Facilities in a state of repair and cleanliness consistent with the standard of
a first class development of a similar nature.
5.08 DAMAGE AND DESTRUCTION
In the event of damage or destruction of the Leased Premises or of the
Building by fire, lightning, earthquake, windstorm or other casualty so that:
(a) the same is damaged or destroyed to the extent that the same
cannot with reasonable diligence be rebuilt, repaired or
restored within one hundred and twenty (120) days of the date of
damage or destruction (as determined in the opinion in writing
of the Landlord's Architect, which written opinion shall be
delivered to the Tenant within thirty (30) days of the
occurrence of such damage or destruction) or the estimated cost
of rebuilding, repairing or restoring such damage or destruction
will exceed twenty percent (20%) of the full insurable value
thereof, then, notwithstanding any other term or condition of
this Lease to the contrary, the Landlord may terminate this
Lease by notice in writing to the Tenant given within sixty (60)
days of the occurrence of such damage or destruction, such
notice to be effective as of the date of the damage or
destruction if the Leased Premises are not capable of being
utilized by the Tenant as determined by the Landlord's Architect
and otherwise to be effective at the date specified in such
notice of termination which shall not be less than thirty (30)
days following receipt of such notice by the Tenant and in
either of such events, the Rent hereby reserved shall be
forthwith payable by the Tenant to the effective date of the
termination, the Term hereby granted shall terminate as of that
date and the Landlord may as of the effective date of
termination re-enter and take possession of the Leased Premises
and deal with the same as fully and effectively as if these
presents had not been entered into. But if within the said
period of sixty (60) days, the Landlord shall not give notice
terminating this Lease, then as soon as reasonably practicable
thereafter, the Landlord shall undertake or continue the
rebuilding, repair or restoration with all reasonable diligence
and the Basic Triple Net Rent hereby reserved, or a
proportionate part thereof depending upon the proportion of the
Leased Premises that are not fit for use by the Tenant for the
intended purpose of this Lease, shall xxxxx until the Leased
Premises have been rebuilt and made fit for the intended
purposes of this Lease;
(b) the same is damaged or destroyed to the extent that the same can
with reasonable diligence be rebuilt, repaired or restored
within one hundred and twenty (120) days of the date of such
damage or destruction (as determined in the opinion in writing
of the Landlord's Architect, which written opinion shall be
delivered to the Tenant within thirty (30) days of the
occurrence of such damage or destruction) and the Landlord is
not otherwise entitled to terminate this Lease pursuant to
Article 5.08(a) the Landlord shall as soon as reasonably
practicable after such determination, undertake or continue the
repair of the same with all reasonable diligence provided,
however, that nothing herein contained shall impose any
obligation upon the Landlord to complete such repair within the
said period of one hundred and twenty (120) days and the Basic
Triple Net Rent hereby reserved, or a proportionate part thereof
depending upon the proportion of the Leased Premises that are
not fit for use by the Tenant for the intended purposes of this
Lease, shall xxxxx until the Leased Premises have been rebuilt
and made fit for the intended purposes of this Lease.
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5.09 QUALIFICATIONS
(a) For the purposes of Article 5.08 the terms "Leased Premises" and
"Building" shall be deemed not to include the Tenant's trade
fixtures, merchandise, stock-in-trade, furniture or any other
improvements installed in the Leased Premises by or on behalf of
the Tenant.
(b) If the Landlord rebuilds, repairs, or restores the Building or
the Leased Premises as contemplated in Article 5.08 it will not
be required to reproduce exactly the Leased Premises or the
Building or restore the same to the exact condition that existed
before the damage or destruction provided that it reproduces or
restores or rebuilds the same to a comparable condition and
configuration.
(c) The certificate of the Landlord's Architect in charge of the
rebuilding, repair or restoration shall bind the Landlord and
the Tenant as to the state and proportion of the suitability for
occupancy of the Leased Premises and as to the date upon which
the Landlord's work of reconstruction or restoration is
completed and the Leased Premises fit for the purposes of the
Tenant.
(d) Notwithstanding any of the provisions of Article 5.08 to the
contrary, in the event the damage or destruction referred to
therein is caused by the negligence or misconduct of the Tenant,
its agents, employees, contractors, licensees or other persons
for whom in law the Tenant is responsible:
(i) and this Lease is not terminated as a result of such
damage or destruction there shall be no abatement of
Basic Triple Net Rent as contemplated in Article 5.08;
and
(ii) the Tenant shall indemnify and hold harmless the
Landlord from and against any liabilities, damages,
costs, claims, suits or actions of any nature whatsoever
suffered by or incurred by the Landlord as a result of
such damage or destruction and this indemnity and hold
harmless covenant shall survive the expiration of the
Term.
5.10 CONDITION OF EXPIRATION
Upon the expiration of the Term the Tenant shall surrender and deliver
up to the Landlord vacant possession of the Leased Premises, which Leased
Premises at such time, unless the expiration of the Term has occurred pursuant
to Article 5.08(i), shall be in the condition in which the same must be
maintained during the Term pursuant to Articles 5.01 and 5.02 and as the same
must otherwise be restored pursuant to Article 9.02.
ARTICLE 6
COMMON AREAS AND COMMON FACILITIES
6.01 TENANT'S USE OF PARKING AREAS
The Tenant shall be permitted to use three (3) parking stalls per 1,000
square feet of the useable area of the Leased Premises and shall park its
vehicles and shall cause its employees to park their vehicles only in such
parking areas as designated by the Landlord from time to time. The use of said
parking stalls shall be at no additional charge to Tenant for the Term
(including any Renewal Term).
6.02 LANDLORD'S RIGHT TO REMOVE VEHICLES
Should the Tenant, its employees, suppliers or other persons not
licensees or invitees of the Tenant park vehicles in areas not allocated for
that purpose, the Landlord shall have the right to remove the said trespassing
vehicles and the Tenant will save harmless the Landlord from any and all damages
arising therefrom and the Tenant will pay the costs of such removal.
6.03 CONTROL OF COMMON AREAS AND COMMON FACILITIES
The Landlord shall at all times have exclusive control and management of
the Common Areas and the Common Facilities. Such control applies to signs, use
of show windows, and the Tenant's publicity visible from the Common Areas, as
well as to the use made by the Tenant and/or the public of the Common Areas. The
Landlord shall have the right to alter, vary, designate and redesignate the
Common Areas and the Common Facilities from time to time and to interfere with
the use of the Common Areas and the Common Facilities to the extent necessary to
make such alterations or variations or any other repairs required or permitted
to be made by the Landlord under this Lease.
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6.04 MERCHANDISE ON COMMON AREA
In particular, but without in any way limiting the generality of the
provisions of Article 6.03, the Tenant shall not keep, display, or sell any
merchandise on or otherwise obstruct or use any part of the Common Areas or the
Common Facilities, except as permitted by the Landlord and except for displays
included in Development promotions when recognized and permitted by the
Landlord.
6.05 VISITOR PARKING
The Landlord shall at all times during the Term of this Lease, designate
for the benefit of the licensees and invitees of the Tenant, visitor parking
facilities, and Landlord agrees not to charge Tenant's licensees or invitees for
the use of such parking facilities.
ARTICLE 7
ASSIGNMENT AND SUB-LETTING
7.01 PROHIBITIONS
The Tenant shall not assign or transfer this Lease or the Term or any
portion thereof or let or sublet all or any part of the Leased Premises or grant
any license with respect thereto (any of the foregoing being hereinafter called
a "Transfer") without the written consent of the Landlord first had and
obtained, which consent shall not be unreasonably withheld or delayed.
All requests to the Landlord for consent to any Transfer shall be made
to the Landlord in writing together with payment to the Landlord of three
hundred dollars ($300.00) as a deposit on account of all costs incurred by the
Landlord in considering and processing the request for consent and such
information in writing as the Landlord might reasonably require respecting a
transferee including, without limiting the generality of the foregoing, the
name, address, business experience, financial position and banking and personal
references of such transferee, and in the event the transferee is a corporation,
similar information respecting the corporation and its principal shareholders,
officers and directors. In addition, the request shall contain a comprehensive
summary of the terms and conditions upon which the Transfer is to occur.
Notwithstanding any provisions of this Article 7.01 to the contrary,
after the Landlord receives such request and information in writing, it shall
have the option, to be exercised by written notice within ten (10) days after
the receipt of such request and information, to terminate this Lease and the
Term hereof on not less than thirty (30) days and not more than ninety (90) days
notice to the Tenant. If the Landlord elects to terminate this Lease as
aforesaid, the Tenant shall have the right, to be exercised by written notice to
the landlord within ten (10) days after receipt of such notice of termination,
to withdraw the request for consent to the proposed Transfer, in which case the
Tenant shall not proceed with such Transfer, the notice of termination shall be
null and void and this Lease shall continue in full force and effect in
accordance with its terms.
If the Landlord consents to a Transfer, the Landlord shall have the
following rights:
(a) to require the Tenant to enter into an agreement in writing to
implement all amendments to the Lease to give effect to the
Landlord's exercise of its foregoing rights; and
(b) to require the Transferee to enter into an agreement directly
with the Landlord to perform and observe all the terms and
conditions of the Tenant pursuant to this Lease.
Whether or not the Landlord consents to any request to Transfer, the
Tenant shall pay Landlord's out-of-pocket legal costs (not to exceed $500.00)
incurred by the Landlord in considering any request for consent to Transfer and
in completing any of the documentation involved in implementing such Transfer.
If Landlord consents to any assignment of this Lease, Tenant shall pay to
Landlord, as additional rent, one-half of all sums and other considerations
payable to and for the benefit of Tenant by the assignee on account of the
Assignment, as and when such sums and other consideration are due and payable by
the assignee to or for the benefit of Tenant (or, if Landlord so requires, and
without any release of Tenant's liability for the same, Tenant shall instruct
the assignee to pay such sums and other consideration directly to Landlord). If
for any proposed sublease Tenant receives rent or other consideration, either
initially or over the term of the sublease, in excess of the rent called for
hereunder or, in case of the sublease of a portion of the Premises, in excess of
such rent fairly allocable to such portion, Tenant shall pay to Landlord as
additional rent hereunder one-half of the excess of each such payment of rent or
other consideration received by Tenant promptly after its receipt.
Notwithstanding any other provisions of this Article 7.01 to the
contrary, neither the Transfer nor the taking of any documentation in relation
thereto shall affect the obligation of the Tenant
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to perform and observe all of the terms and conditions in this Lease to be
observed and performed by the Tenant.
7.02 CONTROL OF CORPORATION
If the Tenant is a corporation, other than a corporation the shares of
which are listed on any recognized stock exchange, effective control of the
corporation shall not be changed directly or indirectly by a sale, encumbrance
or other disposition of shares or otherwise howsoever without first obtaining
the written consent of the Landlord; provided that the Landlord's consent shall
not be required for any sale or other disposition of shares by present
shareholders to and between themselves or in the event of any transmission of
shares on death and provided further that the Landlord's consent shall not be
unreasonably withheld where control of the Tenant is to pass to a subsidiary or
parent of the Tenant.
7.03 JUDICIALLY-IMPOSED ASSIGNMENT
If the non-assignment provisions of this Article 7 are deemed to be
unenforceable in any bankruptcy proceeding, Landlord and Tenant agree that a
showing of adequate assurance of future performance by a prospective assignee of
this Lease must include, without limitation, clear and convincing evidence that:
i) Landlord will receive the full benefit of every term of its bargain under
this Lease, except for the non-assignment and related termination clauses, but
including all rental obligations hereunder; ii) the Premises will continue to be
used solely for the Permitted Use; iii) a judicially-imposed assignment will not
cause an acceleration or increase in the interest rate, or fees in connection
with any loan secured by Landlord's interest in the Building or this Lease; and
iv) the prospective assignee has the means, expertise and experience to operate
the business to be conducted on the Leased Premises in a first-class manner.
7.04 ASSIGNMENT BY LANDLORD
The Landlord may assign all or a part of its interest in this Lease
without the Tenant's knowledge or consent.
ARTICLE 8
INSURANCE
8.01 TENANT TO INSURE
The Tenant, at its sole cost and expense, shall take out and keep in
force during the Term, standard fire and extended coverage, and malicious damage
insurance on the stock-in-trade, furniture, fixtures, glass, improvements and
all other contents of the Leased Premises to their full replacement value, and
comprehensive general liability insurance in an amount of not less than five
million dollars ($5,000,000) all in amounts and with policies in a form
satisfactory to the Landlord with insurers acceptable to the Landlord. Each such
policy shall name the Landlord as an additional insured as its interest may
appear and such comprehensive public liability insurance shall contain a
provision for cross liability as between the Landlord and the Tenant. Each
policy other than public liability policies shall provide that the insurer shall
not have any right of subrogation against the Landlord, its agents or employees
on account of any loss or damage covered by such insurance or on account of
payments made to discharge claims against or liabilities of the Landlord or
Tenant covered by such insurance. The cost or premium for each and every such
policy shall be paid by the Tenant. The Tenant shall obtain from the insurers
under such policies, undertakings to notify the Landlord in writing at least
thirty (30) days prior to any cancellation or reduction in coverage thereof. If
the Tenant fails to take out or keep in force, or provide to the Landlord proof,
as hereafter contemplated, of such insurance, the Landlord shall have the right
to place such insurance on behalf of the Tenant and to pay the premium therefor
and in such event, the Tenant shall repay to the Landlord the amount paid
therefor, which repayment shall be deemed to be Additional Rent payable on the
first day of the next month following the said payment by the Landlord. The
Tenant agrees to provide the Landlord with current copies of the insurance
policies or certificates of insurance described herein at least annually and
more frequently if requested by Landlord.
8.02 NOT TO AFFECT LANDLORD'S INSURANCE
The Tenant will not upon the Leased Premises do or permit to be done, or
omit to do anything which causes or has the effect of causing the rate of
insurance upon the Development or any part thereof to be increased and if the
insurance rate shall be thereby increased by any action of the Tenant, the
Tenant shall pay to the Landlord on demand as Additional Rent the amount by
which the insurance premiums shall be so increased. The Tenant will not store or
permit to be stored upon or in the Leased Premises anything of a dangerous,
inflammable or explosive nature nor anything which would have the effect of
increasing the Landlord's insurance costs or of leading to the cancellation of
such insurance. It is agreed that if any insurance policy upon the Leased
Premises shall be cancelled by the insurer by reason of the use and occupation
of the Leased Premises or any part thereof by the Tenant or by any assignee,
sub-tenant, concessionaire or licensee of the Tenant, or by anyone permitted by
the Tenant to
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be upon the Leased Premises, the Landlord may, at its option, forthwith enter
upon the Leased Premises and rectify the situation causing such cancellation or
rate increase, and the Tenant shall forthwith on demand pay to the Landlord the
costs of the Landlord related to such rectification together with a supervisory
fee of twenty (20%) percent of such cost and with interest on the aggregate of
the foregoing from the date funds were expended by the Landlord.
8.03 LANDLORD TO INSURE
The Landlord shall throughout the Term, carry fire insurance with normal
coverage endorsements in respect of the buildings and improvements forming part
of the Development (but excluding the Tenant's trade fixtures, merchandise,
stock-in-trade, furniture or any other improvements installed in the Leased
Premises by or on behalf of the Tenant) in an amount not less than ninety (90)
percent of the full replacement cost (excluding the cost of foundations,
footings, underground utilities and architects and other fees associated with
these items) from time to time, on a stated amount basis, provided that such
insurance, without further consent or notice to the Tenant, may have a
deductible amount as determined by Landlord. The Landlord may, but shall not be
obligated to, carry such other insurance including public liability insurance
and rental loss insurance related to the Lands or such risks and perils in
relation thereto or the Landlord's interest derived therein as the Landlord may
so determine. All such insurance so obtained by the Landlord shall be for the
sole benefit of the Landlord and the Tenant shall be entitled to no interest
therein or benefit thereof.
ARTICLE 9
TENANT ALTERATIONS
9.01 PAINTING, DECORATING AND ALTERATIONS
The Tenant may, provided it first obtains the written consent of the
Landlord which consent shall not be unreasonably withheld or delayed, at any
time and from time to time at its expense, paint and decorate, in accordance
with the manner and standard referred to in Article 5.01, the interior of the
Leased Premises and make such changes, alterations, additions and improvements
in and to the Leased Premises as will in the judgment of the Tenant better adapt
the Leased Premises for the purposes of its business; provided, however, that no
changes, alterations, additions or improvements to the structure, any perimeter
wall, the sprinkler system, the heating, ventilating, air-conditioning,
plumbing, electrical or mechanical equipment or the concrete floor or the roof
shall be made without the prior written consent of the Landlord, and without the
use of contractors or other qualified workmen approved by the Landlord. All
changes, alterations, additions and improvements, whether structural or
otherwise, shall be carried out in accordance with the reasonable requirements
or rules of the Landlord and shall comply with all applicable statutes,
regulations and laws of any governmental authority. As part of the process of
the Landlord's examination and approval of the Tenant's plans and
specifications, materials may, in addition to being submitted to the Landlord's
Architect, be submitted by the Landlord to other architects, engineers, and
special consultants, and progress and completion of the work may require
supervision and/or inspection by the Landlord or any of the foregoing persons on
behalf of the Landlord. Any fees and costs incurred by the Landlord in relation
to the foregoing will be paid by the Tenant to the Landlord within fifteen (15)
days of billing. The Tenant shall pay to the Landlord the amount of the increase
for any insurance coverage of the Landlord directly attributable to any action
by the Tenant as hereinbefore in this Article 9.01 provided and the Tenant
covenants that such insurance shall not thereby be made liable to avoidance or
cancellation by the insurer by reason of such changes, alterations, additions or
improvements.
9.02 LANDLORD'S PROPERTY
At the expiration of the Term all changes, alterations, additions and
improvements made to or installed upon or in the Leased Premises whether made
pursuant to this Article 9 or otherwise and which in any manner are attached in,
to on or under the floors, walls or ceilings (other than unattached movable
trade fixtures) shall remain upon and be surrendered to the Landlord with the
Leased Premises as part thereof, without disturbance, molestation or injury and
shall be and become the absolute property of the Landlord without any payment or
indemnity by the Landlord or any third party to the Tenant or any other party.
Notwithstanding the foregoing provisions of this Article 9.02, unless the Lease
has been terminated pursuant to Article 5.06(a) the Landlord may remove the
aforesaid changes, alterations, additions and improvements in whole or in part,
in which event the Tenant shall reimburse Landlord for the costs of such removal
and the cost to restore the Leased Premises to the state in which they were
prior to the installation of such changes, alterations, additions and
improvements. The obligations of the Tenant under this Article 9.02 shall
survive the expiration of the Term.
9.03 PROHIBITIONS
The Tenant, its employees, agents and representatives, are expressly
prohibited from entering upon the roof of the Building or any Other Buildings
for any reason whatsoever. The Tenant shall not make any repairs, openings or
additions to any part of the exterior of the Leased Premises, nor place any
attachments, decorations, signs or displays in or upon any Common Area or the
exterior of the Leased
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Premises failing which the Tenant will be held responsible for all ensuing costs
and damages whether to remove such items or to effect repairs needed as a result
of such acts and shall pay the cost thereof to the Landlord forthwith on demand
together with a supervisory fee to the Landlord of twenty (20%) percent of such
cost as well as interest on the aggregate of the foregoing from the date funds
are so expended by the Landlord.
9.04 NO LIENS
The Tenant covenants with the Landlord that it will not permit, do, or
cause anything to be done to the Leased Premises during the period of
construction and fixturing of the Leased Premises or at any time which would
allow any lien, lis pendens, judgment of any court or any mortgage, deed of
trust, or encumbrance of any nature whatsoever to be imposed or to remain upon
the Leased Premises or the Development. In the event of the recording of any
lien or other encumbrance as aforesaid, the Tenant shall at its own expense
immediately cause the same to be discharged. Should the Tenant fail to discharge
such lien or encumbrance within two (2) days of notice from the Landlord to do
so, the Landlord shall be at liberty to pay and discharge such lien or
encumbrance and any amount so paid by the Landlord together with any attorneys'
fees and costs incurred by the Landlord together with interest on any such
amounts from the date of expenditure of such funds by the Landlord shall be paid
by the Tenant to the Landlord forthwith.
ARTICLE 10
UTILITIES AND TAXES
10.01 UTILITIES, BUSINESS TAX AND MACHINERY TAX
The Tenant shall pay and discharge as the same fall due all charges for
utilities provided to or consumed on the Leased Premises during the Term
including telephone installations, water, electrical power, gas and telephone
charges metered separately or charged separately by the authority providing the
same to the Leased Premises as well as any charges of any such authority based
thereon for treatment or other facilities and all other charges similar in
nature, and shall also pay and discharge as the same fall due all business taxes
and rates, personal property taxes, license fees or similar fees which may be
imposed by any municipal, legislative or other authority in respect of the use
or occupancy of the Leased Premises or any personal property situate thereon or
in respect of any fixtures, machinery, equipment or apparatus installed in the
Leased Premises (or elsewhere in the Development by the Tenant).
PROVIDED ALWAYS that if any of the aforesaid utilities are provided to
the Leased Premises through a common metering device or on any other shared
basis with any other premises or portions of the Building or the Development, or
if the Tenant shall use any of such utilities beyond the normal business hours
established from time to time by Landlord for the Building, the Tenant shall pay
to the Landlord forthwith on demand, from time to time by the Landlord, the
Tenant's share of the cost thereof based on such allocation as the Landlord may
reasonably determine in relation to the other premises or portions of the
Building or the Development being so served. The refusal on the part of Tenant
to pay upon demand of Landlord the amount established by Landlord for Tenant's
share of the costs of utilities shall constitute a breach of the obligation to
pay rent under this Lease and shall entitle Landlord to the rights herein
granted for such breach.
10.02 PAYMENT OF REAL PROPERTY TAXES BY LANDLORD
The Landlord shall, without derogating from any of the Tenant's
obligations with respect to payment of Additional Rent, pay or cause to be paid
when due to the municipality or other taxing authorities having jurisdiction all
Real Property Taxes, PROVIDED ALWAYS that the Landlord may postpone such payment
to the extent permitted by law if pursuing in good faith any appeal against the
imposition thereof.
10.03 INCREASE IN REAL PROPERTY TAXES ATTRIBUTABLE TO TENANT
The Tenant shall from time to time if requested by the Landlord, pay to
the Landlord forthwith on demand by the Landlord, an amount equal to any
increase in the amount of Real Property Taxes by reason of any installation,
alteration, or use made in or to the Leased Premises by or for the benefit of
the Tenant or any party claiming by or through the Tenant.
10.04 TAX ON RENT
Despite any other section or clause of this Lease, the Tenant shall pay
to the Landlord upon demand an amount equal to any and all Rent Tax (as defined
below), it being the intention of the parties that the Landlord shall be fully
reimbursed by the Tenant with respect to any and all Rent Tax at the full tax
rate applicable from time to time in respect of the Rent payable for the lease
of the Leased
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Premises pursuant to this Lease. The amount of the Rent Tax so payable by the
Tenant shall be calculated by the Landlord in accordance with the applicable
legislation and shall be paid to the Landlord at the same time as the amounts to
which such Rent Tax apply and is payable to the Landlord under the terms of this
Lease or upon demand at such other time or times as the Landlord from time to
time determines. Despite any other section or clause in this Lease, the amount
payable by the Tenant under this paragraph shall be deemed not to be Rent, but
the Landlord shall have all of the same remedies for and rights of recovery of
such amount as it has for recovery of Rent under this Lease. As referred to
herein "Rent Tax" means any tax imposed on the rents paid to Landlord hereunder.
ARTICLE 11
EXCLUSION OF LIABILITY AND INDEMNITY
11.01 EXCLUSION OF LIABILITY
It is agreed between the Landlord and the Tenant that, except with
respect to the negligent acts of Landlord, its agents and employees:
(a) the Landlord, its agents, and employees shall not be liable for
damage or injury to any property of the Tenant which is
entrusted to the care or control of the Landlord, its agents, or
employees;
(b) the Landlord, its agents, and employees shall not be liable nor
responsible in any way for any personal or consequential injury
of any nature whatsoever that may be suffered or sustained by
the Tenant or any employee, agent, customer, invitee or licensee
of the Tenant or any other person who may be upon the Leased
Premises or the Development or for any loss of or damage or
injury to any property belonging to the Tenant or to its
employees or to any other person while such property is on the
Leased Premises or the Development and, in particular (without
limiting the generality of the foregoing) the Landlord shall not
be liable for any damage or damages of any nature whatsoever to
any such property caused by the failure by reason of a breakdown
or other cause, to supply adequate drainage, snow or ice
removal, or by reason of the interruption of any public utility
or service or in the event that steam, water, rain or snow may
leak into, issue or flow from any part of the Development or
from the water, steam, sprinkler, or drainage pipes or plumbing
works, or from another place or quarter or for any damage caused
by any thing done or omitted by any tenant, but the Landlord
shall, after notice of the same and where it is within its
obligation so to do, use all reasonable diligence to remedy such
condition, failure or interruption of service when not directly
or indirectly attributable to the Tenant, and the Tenant shall
not be entitled to any abatement of Rent in respect of any such
condition, failure or interruption of service; and
(c) the Landlord, its agents, employees or contractors shall not be
liable for any damage suffered to the Leased Premises or the
contents thereof by reason of the Landlord, its agents,
employees or contractors entering upon the Leased Premises to
undertake any examination thereof or any work therein or in the
case of an emergency.
11.02 INDEMNIFICATION
Notwithstanding any other provision of this Lease to the contrary, and
except to the extent of Landlord's negligence, the Tenant shall:
(a) be liable to the Landlord for, and
(b) indemnify and hold harmless the Landlord, its agents, advisors,
and employees from and against:
any and all liabilities, claims, suits or actions, costs, damages and expenses
(and without limiting the generality of the foregoing, any direct losses, costs,
damages and expenses of the Landlord including attorneys' fees and costs) which
may be brought or made against the Landlord, or which the Landlord may pay or
incur as a result of or in connection with:
(c) any breach, violation or non-performance of any covenant,
condition or agreement in this Lease set forth and contained on
the part of the Tenant to be fulfilled, kept, observed and
performed;
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(d) any damage to property, including property of the Landlord,
occasioned by the operations of the Tenant's business on, or the
Tenant's occupation of, the Leased Premises; or
(e) any injury to person or persons, including death resulting at
any time therefrom, occasioned by the operation of the Tenant's
business on, or the Tenant's occupation of, the Leased Premises;
such indemnity and hold harmless to survive the expiration of the Term. Landlord
agrees to provide Tenant with prompt written notice of any claim made against
Landlord covered by the indemnity set forth above and Tenant shall have the
right to defend any such claim with counsel reasonably selected by Tenant.
ARTICLE 12
LANDLORD'S RIGHTS AND REMEDIES
12.01 DEFAULT
Tenant shall be in default if and whenever:
(a) the Rent hereby reserved, or any part thereof, be not paid when
due, or there is non-payment of any other sum which the Tenant
is obligated to pay under any provisions hereof, and such
default shall continue for three (3) business days after written
notice by the Landlord requiring the Tenant to rectify the same;
(b) any goods, chattels, equipment or other personal property of the
Tenant shall be taken or be subject to execution or attachment,
or if a writ of execution or attachment shall issue against the
Tenant;
(c) the Tenant shall become insolvent or commit any act of
bankruptcy or become bankrupt or take the benefit of any Act
that maybe in force for bankrupt or insolvent debtors, or become
involved in a winding-up proceeding, voluntary or otherwise, or
if a receiver shall be appointed for the business, property,
affairs or revenues of the Tenant, or if any governmental
authority should take possession of the business or property of
the Tenant;
(d) the Tenant shall make a bulk sale of its goods or move or
commence, attempt or threaten to move its goods, chattels and
equipment out of the Leased Premises (other than in the routine
course of its business);
(e) the Tenant shall vacate or abandon the Leased Premises in whole
or in part;
(f) the Tenant shall transfer or purport to Transfer any portion or
all of the Term of the Leased Premises without the written
consent of the Landlord or control of the Tenant if a
corporation is changed without the prior written consent of the
Landlord, in either case as required pursuant to Article 7;
(g) the Tenant shall fail to remedy any condition giving rise to
cancellation, threatened cancellation, reduction or threatened
reduction of any insurance policy on the Development or any part
thereof within twenty-four (24) hours after notice thereof by
the Landlord;
(h) the Tenant shall fail to use the Leased Premises for the
Permitted Use or change the use of the Leased Premises to any
use other than the Permitted Use without Landlord's prior
written consent;
(i) the Tenant shall fail to maintain the insurance required to be
maintained by Tenant under this Lease; or
(j) the Tenant shall not observe, perform and keep any other of the
covenants, agreements, provisions, stipulations and conditions
herein to be observed, performed and kept by the Tenant and
shall persist in such failure for thirty (30) days after notice
by the Landlord requiring that the Tenant remedy, correct,
desist or comply (or in the case of any such breach which
reasonably would require more than thirty (30) days to rectify
unless the Tenant shall commence rectification within the said
thirty (30) day period and thereafter promptly and diligently
and continuously proceed with the rectification of the breach).
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In the event of any default by Tenant, at the option of the Landlord, the
Landlord may without notice or any form of legal process forthwith re-enter upon
and take possession of the Leased Premises or any part thereof and remove and
sell the Tenant's goods, chattels, equipment and any other property therefrom,
any rule of law or equity to the contrary notwithstanding; and the Landlord may
seize and sell such goods, chattels, equipment and other property of the Tenant
as are in the Leased Premises or at any place to which the Tenant or any other
person may have removed them in the same manner as if they had remained and been
distrained upon the Leased Premises; and such sale may be effected in the
discretion of the Landlord either by public auction or by private sale, and
either in bulk or by individual item, or partly by one means and partly by
another, all as the Landlord in its entire discretion may decide, and the Tenant
waives and renounces the benefit of any present or future statute or amendments
thereto taking away or limiting the Landlord's right of distress.
12.02 CONSEQUENCES OF DEFAULT
If and whenever the Tenant is in default under this Lease, the Landlord
may terminate this Lease and the Term by giving written notice of termination to
the Tenant or by posting notice of termination in the Leased Premises, and in
such event the Tenant will forthwith vacate and surrender the Leased Premises.
Alternatively, the Landlord may from time to time without terminating the
Tenant's obligations under this Lease, re-enter the Leased Premises, make
alterations and repairs considered by the Landlord necessary to facilitate a
sub-letting and sub-let the Leased Premises or any part thereof as agent of the
Tenant for such term or terms and at such rent or rents and upon such other
terms and conditions as the Landlord in its sole discretion considers advisable.
Upon each subletting all rent and other monies received by the Landlord from the
sub-letting shall be applied first to the payment of indebtedness other than
Rent due hereunder from the Tenant to the Landlord, second to the payment of
costs and expenses of the sub-letting including brokerage fees and attorneys
fees and the cost of alterations and repairs, and third to the payment of Rent
due and unpaid hereunder. The residue, if any, shall be held by the Landlord and
applied in payment of future Rent as it becomes due and payable, If the Rent
received from the subletting during a month and any surplus then held by the
Landlord to the credit of the Tenant is less than the Rent to be paid during
that month by the Tenant, the Tenant will pay the deficiency to the Landlord.
The deficiency will be calculated and paid monthly. No re-entry by the Landlord
will be construed as an election on its part to terminate this Lease unless a
written notice of that termination is given to the Tenant or posted as
aforesaid. Despite a subletting without termination, the Landlord may elect at
any time to terminate this Lease for a previous breach. If the Landlord so
terminates this Lease, the Tenant shall pay to the Landlord on demand therefor:
(a) Basic Triple Net Rent and Additional Rent accrued due up to the
time of re-entry or termination, whichever is later;
(b) all costs payable by the Tenant pursuant to the provisions of
this Lease up until the date of re-entry or termination,
whichever is later;
(c) such expenses as the Landlord may incur or has incurred in
connection with re-entering or terminating and re-letting, or
collecting sums due or payable by the Tenant or realizing upon
assets seized including brokerage expenses, legal fees,
receivership costs, unamortized improvement costs, and other
disbursements determined on a full indemnity basis, and
including the expense of keeping the Leased Premises in good
order and repairing or maintaining the same or preparing the
Leased Premises for re-letting; and
(d) as liquidated damages for the loss of Rent and other income of
the Landlord expected to be derived from this Lease during the
period which would have constituted the unexpired portion of the
Term had the Lease not been so terminated, the amount, if any,
by which the rental value of the Leased Premises for such period
established by reference to the terms and provisions of this
Lease exceeds the rental value of the Leased Premises for such
period established by reference to the terms and provisions upon
which the Landlord relet them, if such re-letting is
accomplished within a reasonable time after termination of this
Lease, and otherwise with reference to all market and other
relevant circumstances. Rental value is to be computed in each
case by reducing to present worth at an assumed interest rate of
ten percent (10%) per annum all Rent and other amounts to become
payable for such period and where the ascertainment of amounts
to become payable requires the same, the Landlord may make
estimates and assumptions of fact which will govern unless shown
to be unreasonable or erroneous;
such obligations of the Tenant to survive the expiration of the Term.
If any of the events described in Article 12.01 occur, and if Landlord
chooses not to exercise, or by law is unable to exercise, its rights to
terminate this Lease, then, in addition to any other Landlord's rights under
this Lease or by law; i) Landlord will not be obligated to provide Tenant with
any
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services unless Landlord receives compensation in advance for the services, and
the parties agree that Landlord's estimate of the compensation required will
control; and ii) neither Tenant as debtor in possession, nor any trustee or
other person (the "Assuming Tenant") will be entitled to assume this Lease
unless, on or before the date of the assumption, the Assuming Tenant: a) cures
or provides adequate assurance that it will promptly cure, any existing default
under this Lease; b) compensates or provides adequate assurance that it will
promptly compensate, Landlord for any pecuniary loss (including attorneys' fees
and costs) resulting from the default; and c) provides adequate assurance of
future performance under this Lease. For the purposes of this Article, the
parties agree that any cure or compensation shall be effected solely by the
establishment of an escrow fund for the amount at issue or by bonding. Any sums
paid by Tenant to Landlord within 90 days of any filing by or against Tenant of
a petition to have Tenant declared a bankrupt will be applied to the expenses
most recently incurred by Landlord. The parties agree that this Article is a
material part of the consideration of the Lease.
12.03 NON-WAIVER
The failure of the Landlord to insist in any one or more cases upon the
strict performance of any of the covenants of this Lease or to exercise any
option herein contained shall not be construed as a waiver or a relinquishment
for the future of such covenant or option and the acceptance of Rent by the
Landlord with knowledge of the breach by the Tenant of any covenants or
conditions of this Lease shall not be deemed to be a waiver of such breach and
no waiver by the Landlord of any provisions of this Lease shall be deemed to
have been made unless expressed in writing by the Landlord.
12.04 RIGHT OF LANDLORD TO PERFORM TENANT'S COVENANTS
If at any time and so often as the same shall happen, the Tenant shall
make default in the observance or performance of any of the Tenant's covenants
herein contained, then the Landlord may, but shall not be obligated to, without
waiving or releasing the Tenant from its obligations under the terms of this
Lease, itself observe and perform the covenant or covenants in respect of which
the Tenant is in default, and in that connection may pay such monies as may be
required or as the Landlord may reasonably deem expedient, and the Landlord may
thereupon charge all monies so paid and expended by it to the Tenant together
with interest thereon from the date upon which the Landlord shall have paid out
the same; provided however that if the Landlord commences and completes either
the performance of any such covenant or covenants or any part thereof, the
Landlord shall not be obliged to complete such performance or be later obliged
to act in like fashion.
12.05 TIME FOR PAYMENT AND LEGAL COSTS
Unless otherwise expressly provided in this Lease, all sums and costs
paid by the Landlord, including attorneys' fees and costs on account of any
default by the Tenant under this Lease, shall be payable to the Landlord by the
Tenant forthwith, with interest thereon at the rate aforesaid from date of
payment of such sums or costs by the Landlord.
Unless otherwise expressly provided in the Lease, all amounts (other
than Rent) required to be paid by the Tenant to the Landlord pursuant to this
Lease shall be payable on demand at the place designated by the Landlord for
payment of Rent.
12.06 REMEDIES CUMULATIVE
All rights and remedies of the Landlord in this Lease contained shall be
cumulative and not alternative and are not dependent the one on the other and
mention of any particular remedy or remedies of the Landlord in respect of any
default by the Tenant shall not preclude the Landlord from any other remedy in
respect thereof, whether available at law or in equity or as expressly provided
for herein.
12.07 LANDLORD DEFAULT
If Landlord fails to perform its obligations under this Lease within a
reasonable time, but in no event later than 30 days after Landlord receives
written notice from Tenant specifying Landlord's default, Landlord is in default
provided, however, if the nature of Landlord's obligation is such that more than
30 days are required to perform its obligation, Landlord will not be in default
if Landlord starts to perform the cure within the 30 day period and diligently
carries out the cure to completion. Landlord will act expeditiously after
receiving notice from Tenant of the need to make repairs pursuant to Article
5.01 if emergency repair is required to terminate a major interruption of or
threat to Tenant's business. If such an emergency repair is required, and
Landlord fails to make such repair within a reasonable amount of time after
receiving notice from Tenant, Tenant shall have the right to make such emergency
repair and Landlord shall reimburse Tenant for the actual cost thereof within
ten (10) days after Tenant's written request for reimbursement, which request
must contain invoices or other evidence acceptable to Landlord of the cost of
the repair performed by Tenant. Tenant shall not have the right to terminate
this Lease as a result of Landlord's default or to perform maintenance or
repairs and deduct the cost from amounts payable by Tenant to Landlord. Tenant's
remedies are limited to an action for monetary damages or an injunction or both.
As a material part of the consideration to Landlord, Tenant agrees that the
execution
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of any judgment obtained by Tenant against Landlord for damages due to
Landlord's default under this Lease is limited to Landlord's interest in the
Building. A copy of any notice of default sent to Landlord by Tenant must be
sent to Landlord's lender, if the lender has requested copies of such notices
and given Tenant the address to send the notices. Landlord's lender will have at
least the same rights as Landlord to cure Landlord's default.
ARTICLE 13
MORTGAGES AND ASSIGNMENT BY LANDLORD
13.01 SALE OR FINANCING OF DEVELOPMENT
The Landlord may sell, transfer, lease, mortgage, encumber or otherwise
dispose of the Development or any portion thereof or any interest of the
Landlord therein, in every case without the consent of the Tenant, and the
rights of the Landlord under this Lease may be mortgaged, charged, transferred
or assigned in conjunction therewith. The Tenant acknowledges that in the event
of the sale or lease by the Landlord of the lands or a portion thereof
containing the Leased Premises or the assignment by the Landlord of this Lease
or of any interest of the Landlord hereunder, to the extent that any such
purchaser, lessee or assignee has assumed the covenants and obligations of the
Landlord hereunder, the Landlord shall, without further written agreement, be
freed and relieved of liability upon such covenants and obligations.
13.02 SUBORDINATION AND ACKNOWLEDGMENT
This Lease shall at the option of the Landlord or the mortgagee under
any mortgage or the beneficiary under any deed of trust now or hereafter
existing affecting the Development, exercisable at any time and from time to
time by the Landlord or such mortgagee or beneficiary, be either subject and
subordinate to such mortgage and accordingly not binding upon such mortgagee or
alternatively rank prior to such mortgage or deed of trust and accordingly be
binding upon such mortgagee or beneficiary. On request at any time and from time
to time of the Landlord or such mortgagee or beneficiary, the Tenant shall
subordinate this Lease to such mortgage or deed of trust with the intent and
effect that this Lease and all rights of the Tenant shall be subject to the
rights of such mortgagee or beneficiary as fully as if the mortgage or deed of
trust (regardless of when made) had been made prior to the making of this Lease,
or alternatively to attorn to such mortgagee or beneficiary and become bound to
it as its tenant of the Leased Premises for the then expired residue of the Term
and upon the terms and conditions contained in this Lease, in each case as the
Landlord or such mortgagee or beneficiary may require provided, however, as long
as Tenant is not in default under this Lease, the mortgagee or beneficiary shall
not disturb Tenant's right to possession of the Leased Premises. Without
limiting the foregoing (and notwithstanding that any previous attornment or
subordination in favor of such mortgagee or beneficiary shall have been given)
the Tenant shall execute promptly the appropriate instrument of subordination or
alternatively the appropriate instrument of attornment as the case may be, in
order to give effect to the foregoing. Landlord agrees to provide Tenant with a
reasonably acceptable subordination, attornment and non-disturbance agreement
from Landlord's lender.
13.03 TENANT ESTOPPEL STATEMENT
Within ten (10) business days following request therefor by the
Landlord, from time to time, the Tenant shall execute and deliver to the
Landlord and if required by the Landlord, to any mortgagee or beneficiary,
assignee, or transferee of the Lease or the Development a certificate in writing
as to the then status of this Lease, including whether it is in full force and
effect, as modified or unmodified, confirming the Rent payable hereunder, the
state of accounts between the Landlord and the Tenant and the existence or
non-existence of defaults and any other matters pertaining to the Lease which
the Landlord shall request be included in such certificate. An example of such a
certificate is attached hereto as SCHEDULE "D".
13.04 ATTORNMENT
In the event of a foreclosure or exercise of the power of sale under any
mortgage or deed of trust covering the Premises, or if any sale in lieu thereof
occurs, Tenant shall attorn to the purchaser on any such foreclosure or sale and
recognize such purchaser as the Landlord under this Lease provided that the
purchaser expressly agrees, in writing, that so long as Tenant is not in default
under the Lease, Tenant's possession and occupancy of the Premises will not be
disturbed.
13.05 RECORDING
This Lease shall not be recorded against title to the Lands. The Tenant
may, with the prior written consent of Landlord, record a short form memorandum
of this Lease, in a form approved by Landlord, in the official records of the
county in which the Lands are located.
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ARTICLE 14
HOLDING OVER
14.01 NO TACIT RENEWAL
In the event the Tenant remains in possession of the Leased Premises
after the end of the Term and without the execution and delivery of a new lease,
there shall be no tacit renewal of this Lease and the Term hereby granted and
the Tenant shall be deemed to be occupying the Leased Premises as a Tenant from
month to month on the terms and conditions contained herein except that the
Basic Triple Net Rent shall be one hundred and fifty percent (150%) of the Basic
Triple Net Rent required to be paid pursuant to this Lease in the immediately
preceding Year of the Term, but otherwise on the terms and conditions of this
Lease which shall be read with such changes as are appropriate to a monthly
tenancy; provided however that this provision shall not authorize the Tenant to
so holdover where the Landlord has objected to such over holding or has required
the Tenant to vacate the Leased Premises.
ARTICLE 15
QUIET POSSESSION
15.01 QUIET POSSESSION
Upon the Tenant paying the Rent hereby reserved and all other charges
herein provided and observing, performing and keeping the covenants and
agreements herein contained, the Tenant shall and may peaceably possess and
enjoy the Leased Premises for the Term granted without any interruption or
disturbance from the Landlord or any person or persons lawfully claiming by,
from or under it.
ARTICLE 16
LEGAL RELATIONSHIPS
16.01 NO PARTNERSHIP
Nothing contained in this Lease nor in any acts of the Landlord and
Tenant pursuant to this Lease shall be deemed to create any relationship between
the parties hereto other than the relationship of Landlord and Tenant, it being
expressly provided that there is no intention to create a relationship of
partners or a joint venture.
16.02 JOINT AND SEVERAL LIABILITY
Should the Tenant comprise two (2) or more persons or entities, each of
them, and not one for the other or others, shall be jointly and severally bound
with the other or others for the due performance of the obligations of the
Tenant hereunder. Where required by the context hereof the singular shall
include the plural and the masculine gender shall include either the feminine or
neuter genders, as the case may be and vice versa.
16.03 SUCCESSORS AND ASSIGNS
This Lease and everything herein contained shall enure to the benefit of
and be binding upon the parties hereto, to successors and assigns of the
Landlord, and the approved successors and assigns of the Tenant.
ARTICLE 17
NOTICES
17.01 NOTICES
Any notices herein provided or permitted to be given by the Tenant to
the Landlord shall, be sufficiently given if delivered or sent by either
facsimile transmission or certified or registered mail, return receipt requested
and postage prepaid, addressed to the Landlord at:
Millennium Corporate Park L.L.C.
c/o Continental Pacific, Inc.
0000 000xx Xxxxxx, X.X. Xxxxx 000
Xxxxxxxx, XX 00000
Facsimile No. (000) 000-0000
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or to such other address as might be designated in writing by the Landlord from
time to time, and any notice herein provided or permitted to be given by the
Landlord to the Tenant shall be sufficiently given if delivered, sent by
facsimile or mailed, postage prepaid, addressed to the Tenant at:
If Prior to Tenant Opening for Business:
--------------------------------------------
--------------------------------------------
Facsimile No.
------------------------------
If After Tenant Opens for Business:
At the Leased Premises
Notice given as aforesaid, delivered by mail, shall be conclusively
deemed to have been given on the third business day following the day on which
such notice was mailed, or if delivered or sent by facsimile, on the date of
delivery or facsimile. The Landlord may at any time give in writing to the
Tenant notice of a change of address for the Landlord and from and after the
giving of such notice the address therein specified shall be deemed to be the
address of the Landlord for the giving of notice hereunder. The word "notice" in
this Article 17.01 shall be deemed to include any request, statement, demand, or
other writing in this Lease provided or permitted to be given by the Landlord to
the Tenant or by the Tenant to the Landlord.
ARTICLE 18
ENVIRONMENTAL COVENANTS
18.01 DEFINITIONS.
In this Article 18:
"Hazardous Substance" means:
(a) any radioactive material;
(b) any explosive;
(c) any substance that if added to any water, would degrade or alter
or form part of a process of degradation or alteration of the
quality of that water to the extent that it is detrimental to
its use by man or by any animal, fish or plant;
(d) any solid, liquid, gas or odor or combination of any of them
that, if emitted into the air, would create or contribute to the
creation of a condition of the air that:
(i) endangers the health, safety or welfare of persons or
the health of animal life;
(ii) interferes with normal enjoyment of life or property; or
(iii) causes damage to plant life or to property;
(e) any toxic substance;
(f) any substance declared to be hazardous or toxic under any Law,
Regulation or Order (as defined below) now or hereafter enacted
or promulgated by any governmental authority having jurisdiction
over the Landlord, the Tenant, the Leased Premises or the
Development of which the Leased Premises form a part; and
(g) any other substance which is or may become hazardous, dangerous
or toxic to persons or property;
"Laws" means all applicable federal, state, municipal, or local laws,
statutes, or ordinances, relating to Hazardous Substances;
"Regulations" mean all rules, regulations or the like promulgated under
or pursuant to any Laws; and
"Orders" mean all applicable orders, decisions, or the like rendered by
any ministry, department or administrative or regulatory agency.
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18.02. TENANT'S COVENANT AS TO USE
Without limiting the generality of the covenants of the Tenant in the
Lease contained including Basic Term .03 thereof, the Tenant covenants and
agrees that the Tenant will not bring upon the Leased Premises or any part
thereof any Hazardous Substances (except for commonly used office equipment,
including a back-up generator) and if at any time, notwithstanding the foregoing
covenant of the Tenant, there shall be any Hazardous Substances upon the Leased
Premises or a part thereof whether or not brought thereupon by the Tenant, the
Tenant shall, at its own expense:
(a) immediately give the Landlord notice specifying the nature and
location of the Hazardous Substances and thereafter give the
Landlord from time to time written notice of the extent and
nature of the Tenant's compliance with the following provisions
of this paragraph;
(b) promptly remove the Hazardous Substances from the Leased
Premises in a manner which conforms with all Laws, Regulations
and Orders governing the movement of the same and the reasonable
requirements of the Landlord in connection with the movement;
and
(c) if requested by the Landlord, obtain at the Tenant's cost and
expense from an independent consultant designated or approved by
the Landlord verifying the complete and proper removal thereof
from the Leased Premises or, if such is not the case, reporting
as to the extent and nature of any failure to comply with the
foregoing provisions of this paragraph.
18.03. COMPLIANCE WITH LAWS
Without limiting the generality of the covenants of the Tenant in the
Lease contained including Article 4.09, the Tenant shall, at its own cost and
expense, comply with all Laws, Regulations and Orders from time to time in force
relating to the Landlord, the Tenant, the business of the Tenant, the Leased
Premises or the Development relating to Hazardous Substances and the protection
of the environment and shall immediately give written notice to the Landlord of
the occurrence of any event in the Leased Premises or on the Development or a
contravention thereof and, if the Tenant shall, either alone or with others,
cause the occurrence of such event the Tenant shall, at its own expense:
(a) immediately give the Landlord notice of the occurrence and the
contravention and thereafter give the Landlord from time to time
written notice of the extent and nature of the Tenant's
compliance with the following provisions of this paragraph;
(b) promptly remedy the contravention in a manner which conforms
with all Laws, Regulations and Orders governing the movement of
the same; and
(c) if requested by the Landlord, obtain at the Tenant's cost and
expense from an independent consultant designated or approved by
the Landlord verifying the complete and proper remedying of the
contravention or, if such is not the case, reporting as to the
extent and nature of any failure to comply with the foregoing
provisions of this paragraph.
The Tenant shall, at its own expense, remedy any damage to the Leased
Premises and the Development caused by such event within the Leased Premises or
by the performance of the Tenant's obligations under this paragraph as a result
of such occurrence. If the Tenant fails to do so, the Landlord may at its option
remedy the damage, and may recover its cost and expenses of so doing from the
Tenant as additional rental under the Lease. Tenant shall indemnify, defend and
hold harmless Landlord from any costs, fees, penalties, and charges assessed
against, or imposed, on Landlord and Landlord's lender as a result of Tenant's
use, release, disposal, transportation, or generation of Hazardous Substances.
This provision survives the expiration or earlier termination of this Lease.
If any governmental authority having jurisdiction shall require the
clean-up of any Hazardous Substances held, released, spilled, abandoned or
placed upon the Leased Premises or the Development or released into the
environment by the Tenant in the course of the Tenant's business or as a result
of the Tenant's use or occupancy of the Leased Premises, then the Tenant shall,
at its own expense, prepare all necessary studies, plans and proposals and
submit the same for approval, provide all bonds and other security required by
governmental authorities having jurisdiction and carry out the work required and
shall keep the Landlord fully informed and provide to the Landlord full
information with respect to the proposed plans and comply with the Landlord's
reasonable requirements with respect to such plans. The Tenant agrees that if
the Landlord determines, in its own discretion, that the Landlord, the
Development or its reputation is placed in any jeopardy by the requirement for
any such work, the Landlord may itself undertake such work or any part thereof
at the cost and expense of the Tenant. All costs and expenses incurred by
Landlord shall be paid by Tenant on demand together with a fee of twenty (20%)
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percent of such amount and in addition shall pay interest on the aggregate of
the foregoing at the rate provided in this Lease from the date of the
expenditure of such first mentioned monies by the Landlord.
18.04. INQUIRIES BY LANDLORD
The Tenant hereby authorizes the Landlord to make inquiries from time to
time of any government or governmental agency with respect to the Tenant's
compliance with any and all laws and regulations pertaining to the Tenant, the
Tenant's business and the Leased Premises including without limitation Laws,
Regulations and Orders pertaining to Hazardous Substances and the protection of
the environment; and the Tenant covenants and agrees that the Tenant will from
time to time provide to the Landlord such written authorization as the Landlord
may reasonably require in order to facilitate the obtaining of such information.
18.05. EVENT OF DEFAULT
The presence of any Hazardous Substances in the Leased Premises without
the prior written approval of the Landlord shall be considered to be a default
for the purposes of the Lease if such presence remains after the applicable
notice period set forth in Section 12.01.
18.06. OWNERSHIP OF HAZARDOUS SUBSTANCES
If the Tenant shall bring or create upon the Development or the Leased
Premises any Hazardous Substance or if the conduct of the Tenant's business
shall cause there to be any Hazardous Substance upon the Development or the
Leased Premises then, notwithstanding any rule of law to the contrary, such
Hazardous Substance shall be and remain the sole and exclusive property of the
Tenant and shall not become the property of Landlord notwithstanding the degree
of affixation of the Hazardous Substance or the goods containing the Hazardous
Substance to the Leased Premises or the Development and notwithstanding the
expiration or earlier termination of this Lease.
18.07. SURVIVAL OF COVENANTS
The obligations of the Tenant hereunder relating to Hazardous Substances
shall survive the expiry or earlier termination of this Lease save only that, to
the extent that the performance of those obligations requires access to or entry
upon the Leased Premises or the Development or any part thereof, the Tenant
shall have such entry and access only at such times and upon such terms and
conditions as the Landlord may from time to time specify; and the Landlord may,
at the Tenant's cost and expense, itself or by its agents, servants, employees,
contractors and subcontractors, undertake the performance of any necessary work
in order to complete such obligations of the Tenant; but having commenced such
work, the Landlord shall have no obligation to the Tenant to complete such work.
18.08. RIGHT TO USE HAZARDOUS SUBSTANCES
Notwithstanding anything to the contrary herein contained, the Landlord
acknowledges and agrees that the Tenant uses certain substances and materials in
the conduct of the Tenant's business which would be considered Hazardous
Substances hereunder. Accordingly, the Landlord hereby consents and agrees to
the presence of such Hazardous Substances upon the Development and the Leased
Premises, provided the following conditions are met:
(a) the Tenant shall only bring upon the Development and upon the
Leased Premises such Hazardous Substances as are reasonably
required for the conduct of its business operations within the
Leased Premises, and shall forthwith remove from the Development
and from the Leased Premises any Hazardous Substances which are
no longer required for such business operations;
(b) under no circumstances will the Tenant use the Leased Premises
or any portion thereof to stockpile or warehouse Hazardous
Substances, other than in such reasonable quantities as may be
required for its business operations within the Leased Premises;
(c) the Tenant will comply fully with all Laws, Regulations and
Orders related to the transportation, storage, use and disposal
of all Hazardous Substances so brought upon the Development or
the Leased Premises by the Tenant; and
(d) save for the right to bring Hazardous Substances upon the
Development and the Leased Premises for use as aforesaid, the
Tenant shall be bound by all of the other terms and conditions
of this Section including, without limitation, the obligation to
remedy any damage to the Leased Premises or to the Development
caused by the Tenant's exercise of its rights hereunder.
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ARTICLE 19
GENERAL
19.01 COLLATERAL REPRESENTATIONS AND AGREEMENTS
The Tenant acknowledges that the Leased Premises are taken without
representation of any kind on the part of the Landlord or its agent other than
as set forth herein, that the plans attached as SCHEDULE "A" set forth the
general layout of the Building and shall not be deemed to be a representation or
agreement of the Landlord that the Building will be exactly as indicated on such
plans, and that nothing contained in the Lease shall be construed so as to
prevent the Landlord from varying or altering the location or size of parking
areas, driveways, sidewalks or from erecting additional buildings or extending
buildings after the Commencement Date and without limiting the foregoing, the
Landlord shall have the unrestricted right to add additional lands to the
Development, which upon such addition, these additional lands will be included
within the definition of the Lands and Development, to construct additional
buildings from time to time on the Lands, add or change any building, or alter
the ingress and egress to the Development and to change the loading or unloading
facilities and service entrances from time to time without in any way being
responsible to the Tenant, provided only that the Landlord shall at all times
provide reasonable access to the Leased Premises across the Lands for the
Tenant, its employees, suppliers, agents, licensees and invitees. Subject to the
foregoing and to the obligations of the Landlord to maintain at all times
adequate parking facilities, the Landlord may transfer or dispose of portions of
the Lands to the owners of abutting property, or dedicate or transfer to the
municipal authorities portions of the Lands for road-widening and other
purposes, and when and so often as the Landlord shall dispose or transfer or
dedicate any portion of the Lands, then the reference herein to the Lands shall
mean and refer to the portion of the Lands remaining after any such transfer,
disposition or dedication together with any adjacent land which may be acquired
by the Landlord on any such transfer, disposition or dedication. The Tenant
further agrees that no representative of or agent of the Landlord is or shall be
authorized or permitted to make any representation with reference to this Lease,
or to vary or modify this Lease in any way, and that this Lease contains all the
agreements and conditions made between the Landlord and the Tenant hereto
respecting the Leased Premises. Any addition to or alteration of or change in
this Lease or other agreements hereafter made or conditions created, to be
binding, must be made in writing and signed by the Landlord and the Tenant.
19.02 MANAGEMENT OF DEVELOPMENT
The Tenant acknowledges to the Landlord that the Development may be
managed by such party or parties as the Landlord may in writing designate and to
all intents and purposes the manager of the Development shall be the party at
the Development authorized to deal with the Tenant on behalf of the Landlord.
19.03 TIME OF THE ESSENCE
Time shall be of the essence of this Lease.
19.04 UNAVOIDABLE DELAYS
In the event that the Landlord shall be delayed, hindered or prevented
from the performance of any covenant hereunder by Force Majeure, the performance
of such covenant shall be excused for the period during which such performance
is tendered impossible and the time for performance thereof shall be extended
accordingly, but this shall not excuse the Tenant from the prompt payment of
Rent or any other amount required to be paid by the Tenant under the provisions
of this Lease.
19.05 ACCORD AND SATISFACTION
No payment by the Tenant hereunder or receipt by the Landlord of a
lesser amount than the payment of Basic Triple Net Rent or Additional Rent or
any other payments herein stipulated shall be deemed to be other than on account
of the stipulated sum, nor shall any endorsement or statement on any check or
any letter accompanying any check or payment be deemed an accord and
satisfaction, and the Landlord may accept such check or payment without
prejudice to the Landlord's right to recover the balance due or pursue any other
remedy provided in this Lease.
19.06 COVENANTS
Each of the terms and conditions of this Lease to be performed and
observed by the Tenant or by the Landlord, as the case may be, is and shall be
construed as a covenant of the party so required to perform and observe the
same.
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19.07 CONSENT OR APPROVAL OF LANDLORD
Wherever and whenever the consent, approval or permission of the
Landlord is required by the Tenant pursuant to the terms of this Lease, and
unless otherwise specifically provided, the Landlord shall have the right to
withhold, grant, or conditionally grant such consent, approval or permission in
its sole and arbitrary discretion. Such consent, approval or permission must be
in writing to be effective, and such consent approval or permissions must be
obtained prior to the taking of the action to which the same refers.
19.08 FOR LEASE SIGNS
The Landlord shall have the right during the last six (6) months of the
Term to place upon the Leased Premises, a notice of reasonable dimensions
stating that the Leased Premises are for lease and the Tenant shall not obscure
or remove such notice or permit the same to be obscured or removed.
19.09 NO EXCLUSIVITY
This Lease shall not in any way be construed as giving to or conferring
upon the Tenant any rights to carry on any business or undertaking in or from
the Leased Premises to the exclusion of third parties in the Development.
19.10 SCHEDULES
Any and all schedules attached hereto are deemed to be incorporated into
and form part hereof.
19.11 APPLICABLE LAW
This Lease shall be governed by and construed in accordance with the
laws in force in the State of Washington.
19.12 HEADINGS
The index and headings in this Lease are inserted for convenience of
reference only and shall not affect the construction of this Lease or any
provision hereof.
19.13 TENANT'S ACCEPTANCE
The Tenant hereby accepts the Lease of the Leased Premises to be held by
the Tenant, subject to the conditions, restrictions and covenants set forth
herein.
19.14 SEVERABILITY
Should any provision of this Lease be unenforceable it shall be
considered separate and severable from the remaining provision of this Lease,
which shall remain in force and be binding as though the said provision had not
been included.
19.15 EMINENT DOMAIN
If any portion of the Leased Premises is taken by any public or
quasi-public authority under the power of eminent domain, or it is purchased by
the condemnor in lieu of a taking, either party may terminate this Lease on 30
days written notice to the other with termination being the date that possession
is given to the condemnor. If neither party terminates the Lease, the Basic
Triple Net Rent and Additional Rent will be proportionately abated. If any part
of the Building or Development other than the Leased Premises is taken, Landlord
may, at its option, terminate this Lease on 30 days written notice to Tenant.
Tenant is entitled to receive all portions of any condemnation award or
settlement attributable to Tenant's moving costs or the unamortized portion of
any Tenant paid tenant improvements other than through payments in any form,
including rent, to the Landlord. Landlord is entitled to receive all other
portions of any condemnation award or settlement. Landlord shall have the
exclusive right to negotiate with any condemning authority with respect to any
settlement in lieu of condemnation award.
19.16 TENANT'S CAPACITY
Tenant is a Washington Corporation, and the individuals that signed this
Lease on behalf of Tenant are authorized to do so and their signatures are the
only signatures required.
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19.17 LANDLORD'S CAPACITY
Landlord is a Washington Limited Liability Corporation and the
individuals that signed this Lease on behalf of the Landlord are authorized to
do so and the signatures are the only signatures required.
19.18 ATTORNEYS' FEES
If any action is brought by either party against the other arising out
of or in connection with this Lease, the substantially prevailing party shall be
entitled to recover its costs, including, but not limited to, attorneys' and
accountants' fees incurred in the action including any appeal or arbitration.
ARTICLE 20
DEFINITIONS
In this Lease, the following words, phrases and expressions are used
with the meanings described as follows:
20.01 "ADDITIONAL RENT" for a Lease Year or portion thereof means in addition
to the Basic Triple Net Rent all other amounts which shall become due and
payable hereunder by the Tenant to the Landlord and includes the amounts which
is the aggregate of:
(i) the Tenant's Proportionate Share of the HVAC Costs,
(ii) the Tenant's Proportionate Share of the Building Operation and
Maintenance Costs,
(iii) the Tenant's Proportionate Share of the Development Operation
and Maintenance Costs, and
(iv) the Tenant's Proportionate Share of the Tax Cost.
In each case the items comprising or being deducted from the aforesaid Costs or
Cost are to be allocated to such Lease Year by the Landlord in accordance with
generally accepted accounting practice, provided that if the Term commences
other than at the beginning of a Lease Year or ends other than at the conclusion
of a Lease Year a prorate adjustment of the aforesaid costs for such Lease Year
shall be made based on the length of the Term falling within such Lease Year,
provided further that the Tax Cost shall, unless otherwise specifically stated
in the enabling legislation giving rise thereto, be deemed to accrue equally
from day to day in the calendar year to which the same related and shall, if
adjustment is required as aforesaid, be adjusted on that basis and not on a
straight pro rata basis as provided aforesaid.
20.02 "AREA OF LEASED PREMISES" means the gross Building area of the Leased
Premises including any load factor measured by the Landlord's Architect in
accordance with the then current standard for floor measurement as established
by the Building Owners and Managers Association (BOMA) based on the Tenant's
space plan as described in "SCHEDULE B".
20.03 "BASIC TRIPLE NET RENT" means the monthly rent payable by the Tenant to
the Landlord in accordance with Article 2.01 for the Term, being the amount set
forth in Basic Term .02.
20.04 "BASIC TERM" means each of those terms defined as such at the
commencement of this Lease.
20.05 (a) "BUILDING" means the building or buildings in which the Leased
Premises are located as shown on Schedule "A" hereto.
(b) "BUILDING C" means the Building identified as Building C on the plan
attached as Schedule "A" attached hereto.
20.06 "BUILDING OPERATION AND MAINTENANCE COSTS" means all of the Landlord's
costs, charges and expenses for owning, operating, maintaining, managing,
repairing (excluding repairs of a structural nature), inspecting, insuring,
supervising and administering the Building including the Common Areas and Common
Facilities of the Building, if any, and includes without limiting the generality
of the foregoing:
(a) the cost of lighting, heating, ventilating, air-conditioning and
supplying water and other utilities to the Common Facilities and
Common Areas, as aforesaid; cleaning and janitorial services
relating to the Building; wages and other employment related
costs and expenses of on-site maintenance and management
personnel
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as well as wages and other related costs and expenses of
off-site maintenance and management personnel to the extent
applicable to the Building, Common Areas or Common Facilities;
accounting and legal fees incurred in the management of the
Building (with the exception of those fees attributable to
another tenant by virtue of a direct tenant related issue); the
fair market rental value of on-site facilities (including
office space and/or storage space) utilized for the maintenance
and/or management of the Building, Common Areas and/or Common
Facilities; repairs and replacements to the Building other than
structural repairs required to be carried out by the Landlord
pursuant to Article 5.06(a) but including any changes made to
the Building, whether or not structural in nature, required by
any governmental or other agencies which regulate the operation
of the Development, provided that capital improvements costing
in excess of $20,000 shall be amortized over their useful life;
insurance premiums for any insurance carried by the Landlord
pursuant to the terms of this Lease and related only to the
Building;
(b) management fees paid by Landlord or a fee for Landlord's
management and administration not to exceed two and one-half
percent (2.5%) of the sum of the Basic Triple Net Rent; and
(c) depreciation, at rates determined by the Landlord, but not to
exceed the maximum permitted to the Landlord under the
provisions of the Internal Revenue Code, as amended from time to
time or any legislation substituted therefore on the equipment
and machinery employed in operating, managing, maintaining,
repairing or replacing the Common Areas or the Common Facilities
of the Building, if any, and a carrying cost at the rate of two
(2%) percent above the Prime Rate on the undepreciated portion
of the costs of such equipment and machinery;
and there shall be excluded from such costs the following:
(i) payments of principal and interest under any mortgage or
mortgages on the Development; and
(ii) corporate income, profits or excess profits taxes assessed upon
the income of the Landlord;
and there shall be deducted from such costs the amount of proceeds actually
recovered by the Landlord from insurance and relating to damage, the cost of
repair of which was included in Building Operation and Maintenance Costs.
20.07 "COMMENCEMENT DATE" means the later of (a) five (5) days after
Substantial Completion of the Tenant Improvements in accordance with SCHEDULE
"B" or (b) May 1, 1998.
20.08 "COMMON AREAS" means those areas located either in the Building or on
the Lands but not in any Other Buildings, that are not intended for lease and
designated (which designation may be changed from time to time) by the Landlord
as Common Areas set aside by the Landlord for the common or joint use and
benefit of the Tenant, its employees, customers and other entities in common
with others entitled to the use and benefit of such areas in the manner and for
the purposes established or altered pursuant to the terms of this Lease.
20.09 "COMMON FACILITIES" means the electrical, heating, ventilating, air
conditioning, plumbing and drainage equipment, any music and public address
systems, installations and any enclosures constructed therefor, fountains,
service rooms, customer and service stairways, elevators, signs, lamps, public
washroom facilities, recreational facilities (including without limitation a
common amenity building) and all other facilities which are provided and
designated (and which designation may be changed from time to time) by the
Landlord for the common or joint use and benefit of the occupants of the
Development.
20.10 "CONTROLLABLE COSTS" means all Additional Rent except insurance costs,
utility costs, and the Tax Cost. Controllable Costs shall not exceed $0.15 per
sq. ft. per month for the first twelve (12) months of occupancy.
20.11 "DEVELOPMENT" means the Lands, Building, Other Buildings and all
buildings and improvements existing on the Lands from time to time.
20.12 "DEVELOPMENT OPERATION AND MAINTENANCE COSTS" means all of the
Landlord's costs, charges and expenses of operating, maintaining, managing,
repairing, inspecting, insuring, supervising and administering the Development
other than the Building or any Other Buildings, but including the Common
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Areas and the Common Facilities of the Development and include without limiting
the generality of the foregoing:
(a) the cost of lighting, heating, ventilating, air-conditioning and
supplying water and other utilities to the Common Areas and
Common Facilities; cleaning, janitorial services, snow and ice
removal, striping or repairing parking areas; supervising,
policing and security; wages and other employment related costs
and expenses of on-site maintenance and management personnel as
well as wages and other related costs and expenses of off-site
maintenance and management personnel; accounting and legal fees
incurred in the management of the Development (with the
exception of those fees attributable to another tenant by virtue
of a direct tenant related issue); the fair market rental value
of on-site facilities (including office space and/or storage
space) utilized for the maintenance and/or management of the
Development; painting, planting or landscaping; operating and
maintaining the garbage compaction equipment if any; the cost of
maintaining, repairing, replacing or leasing the pylon signs and
public address, intercom, music, and alarm systems; repairs and
replacements to the Development, business taxes, place of
business taxes and other taxes levied in respect thereof or
fairly attributable to the Common Areas or the Common
Facilities; the cost of all capital improvements required by
governmental agencies following completion of the Development,
amortized over the useful life of the capital improvements;
insurance premiums for any insurance carried by the Landlord
pursuant to the terms of this Lease other than for the Building
or any Other Buildings; supplies, personnel wages and payroll
expenses; and
(b) depreciation, at rates determined by the Landlord, but not to
exceed the maximum permitted to the Landlord under the
provisions of the Internal Revenue Code from time to time or any
legislation substituted therefor, on the equipment and machinery
employed in operating, maintaining, repairing or replacing the
Common Areas or the Common Facilities and a carrying cost at the
rate of two (2%) percent above the Prime Rate on the
undepreciated portion of the costs of such equipment and
machinery;
and there shall be excluded from such costs the following:
(i) payments of principal and interest under any mortgage or
mortgages on the development;
(ii) corporate income, profits or excess profits taxes assessed upon
the income of the Landlord; and
(iii) Building Operation and Maintenance Costs;
and there shall be deducted from such costs the amount of proceeds actually
recovered by the Landlord from insurance and relating to damage, the cost of
repair of which was included in Development Operation and Maintenance costs.
20.13 "FORCE MAJEURE" means any cause beyond the control of the Landlord
delaying, hindering or preventing the Landlord from performing any term,
covenant or act required hereunder and, without limiting the generality of the
foregoing, includes lock-outs (including lock-outs decreed or recommended for
its members by a recognized contractors' association of which the Landlord is a
member or to which the Landlord is otherwise bound), strikes, labor disputes,
inability to procure materials or services, restrictive governmental laws or
regulations, fire, act of God, floods, delays in transportation, acts of civil
or military authorities, riots, insurrection, sabotage, rebellion and war.
20.14 "GROSS RENTABLE AREA" means the aggregate floor area (expressed in
square feet), from time to time, determined by the Landlord's Architect of all
premises leased to or intended to be leased to tenants and located within the
area to which the measurement is being applied.
20.15 "HVAC COSTS" includes with respect to the Building:
(a) all of the Landlord's costs, charges and expenses of operating,
maintaining, managing, replacing, repairing and supervising the
apparatus for heating, ventilating and air conditioning
installed in the Building, from time to time, other than those
part of such apparatus installed by or on behalf of the Tenant
or any other tenant (the "HVAC System"); and
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(b) an administrative fee equal to two and one-half percent (2.5%)
of the total of the costs, charges and expenses incurred by the
Landlord under the preceding provision of this definition;
20.16 "LANDLORD'S ARCHITECT" means an architect or engineer from time to time
selected by the Landlord for the purpose of making any certification or
determination in accordance with the terms of this Lease.
20.17 "LANDLORD'S WORK" means the work specified in Article 3.01.
20.18 "LANDS" means those lands located in the City of Xxxxxxx, in the County
of King, State of Washington, legally described on SCHEDULE "A-1" attached
hereto.
20.19 "LEASE" means this agreement, including any and all schedules attached
hereto as the same may be amended from time to time.
20.20 "LEASE YEAR" means each calendar year in which a portion of the Term
falls, provided that the Landlord, if it deems the same convenient or necessary
for its accounting purposes, may, from time to time, by notice to the Tenant
alter the Lease Year to any other twelve (12) month period in which a portion of
the Term falls by specifying an annual date, being the first day of a calendar
month, upon which a subsequent Lease Year is to commence and in such event the
current Lease Year shall terminate on the day preceding the specified date.
20.21 "LEASED PREMISES" means that portion of the Building outlined in red on
Schedule "A" hereto, subject to such minor variations as may occur in the course
of construction of the Building by the Landlord.
20.22 "OTHER BUILDINGS" means any building or buildings existing on the Lands
from time to time containing premises that are leased or intended to be leased
to tenants, but excluding the Building.
20.23 "PERMITTED USE" means the use set forth in Basic Term .03.
20.24 "PRIME RATE" means the rate of interest expressed as an annual rate, at
the relevant time or times, determined by the Seafirst Bank at its main branch
in Seattle, Washington, as a reference rate for commercial demand loans to its
major commercial borrowers made by such bank in Seattle, Washington and adjusted
from time to time.
20.25 "REAL PROPERTY TAXES" means all general, special, local improvement and
other taxes, levies, rates and charges levied, assessed or imposed against the
Development or any part thereof and all business taxes, assessments, rates and
levies, including any corporation capital tax, levied, assessed or imposed on
the Landlord in respect of the ownership or management of the Development by
city or other governmental authority having jurisdiction, whether of a nature
now or hereafter levied, assessed or imposed, together with the cost to the
Landlord of contesting, appealing or negotiating the same in good faith but
excluding those taxes and fees of the Tenant or other tenants referred to in
Article 10.01 hereof.
20.26 "RENT" means Basic Triple Net Rent and Additional Rent.
20.27 "TAX COST" means the cost of Real Property Taxes.
20.28 "TENANT'S PROPORTIONATE SHARE" means:
(a) in relation to each of Building Operation and Maintenance Costs
and HVAC Costs the proportion that the Area of the Leased
Premises is of the Gross Rentable Area of the Building; and
(b) in relation to Development Operation and Maintenance Costs, and
Tax Cost, the proportion that the Area of the Leased Premises is
of the Gross Rentable Area of the Development. Prior to
completion of construction of all buildings in the Development,
the estimated Gross Rentable Area of all buildings planned in
the Development from time to time shall be used for the purposes
of determining Tenant's Proportionate Share of Development
Operation and Maintenance Costs.
20.29 "TENANT IMPROVEMENTS" means the improvements described in SCHEDULE "B"
hereto.
20.30 "TERM" means the term of the Lease, as set out in Basic Term .04.
20.31 "YEAR OF THE TERM" means each successive twelve (12) month period of the
Term, the first of which commences on the Commencement Date.
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ARTICLE 21
CONTINGENCIES
21.1 TENANT'S CONTINGENCY. If Landlord has not obtained approval of
Landlord's proposed site plan for the Development by January 31, 1998, Tenant
shall have the right to terminate this Lease by giving Landlord written notice
of Tenant's election to terminate the Lease on or before February 10, 1998. If
Tenant elects to terminate this Lease under this Article 21.1, this Lease shall
terminate effective as of the date of Tenant's notice of termination.
ARTICLE 22
REIMBURSEMENT OF TENANT'S RENT OBLIGATIONS
Commencing on the Commencement Date and continuing through February 28,
1999, Landlord agrees to pay Tenant, on a monthly basis on or before the first
day of each calendar month, the amount of $37,778.00 (the "Rent Reimbursement"),
which amount represents one-half (1/2) of Tenant's base rental obligations under
Tenant's existing lease with Xxxx Realty Corporation for space at 0000 - 000xx
Xxxxxx X.X., Xxxxxxx, Xxxxxxxxxx (the "Existing Lease"). In no event shall
Landlord be obligated to pay Tenant more than the above established amount of
the Rent Reimbursement and nothing in this Article 22 shall be construed to be
an assumption by Landlord of any of Tenant's obligations under the Existing
Lease. Notwithstanding anything herein to the contrary, if the Existing Lease or
Tenant's obligation to pay rent thereunder terminates or is reduced prior to
February 28, 1999, Landlord's obligation to pay Tenant the Rent Reimbursement
shall also terminate or be reduced accordingly. Tenant hereby authorizes
Landlord to negotiate directly with the landlord under the Existing Lease to
obtain an agreement for the early termination of the Existing Lease and/or a
reduction in the amounts due thereunder on terms reasonably acceptable to
Tenant.
ARTICLE 23
NAME OF DEVELOPMENT
Landlord agrees to name the first phase of the Development after Tenant
and shall keep such name in place for so long as Tenant occupies the Leased
Premises. The exact name shall be mutually agreed upon between Landlord and
Tenant and shall be similar to "Mosaix Center at Millennium Corporate Park".
ARTICLE 24
REFIT ALLOWANCE
Provided Tenant is not then in default under the Lease, Landlord agrees
to provide Tenant with an additional tenant improvement allowance of $250,000
(the "Refit Allowance") following the seventh (7th) anniversary of the
Commencement Date. The Refit Allowance shall be used exclusively for the
installation of new carpet and interior paint (the "Refit Improvements") unless
otherwise agreed to by Landlord. The Refit Improvements shall be constructed by
Landlord in accordance with the procedures set forth in Schedule B for the
construction of the initial Tenant Improvements or, at Landlord's option, Tenant
shall construct the Refit Improvements in compliance with the requirements to
make alterations set out in paragraph 9.01.
ARTICLE 25
BROKERS
Landlord shall pay Tenant's real estate broker, Pacific Real Estate
Partners, Inc. ("Tenant's Broker"), a fee of five percent (5%) of the total
Basic Triple Net Rent for the first five (5) years of the Term (which, for
purposes of this Article 25, shall be March 1, 1999 to February 28, 2004) and
two and one-half percent (21/2%) of the Basic Triple Net Rent for the second
five (5) years of the Term (which, for purposes of this Article 25, shall be
March 1, 2004 to February 28, 2009). Such fee shall be paid by Landlord when
Tenant takes occupancy of the Leased Premises. In the event Tenant expands or is
negotiating to expand the Leased Premises during the first two (2) years the
Term, Landlord agrees to pay a fee with respect to the expansion space of two
and one-half percent (21/2%) of the Basic Triple Net Rent for the remaining
first five years of the Term and one and one-quarter percent (11/4%) of the
Basic Triple Net Rent for the last five years of the Term. Tenant represents and
warrants to Landlord that it has not dealt with any real estate broker other
than Tenant's Broker with respect to this Lease. If Tenant has dealt with any
other person or real estate broker with respect to this transaction, Tenant
shall be solely responsible for the payment of any fee due said person or firm
and Tenant shall hold Landlord free and harmless against any liability in
respect thereto, including attorney's fees and costs.
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IN WITNESS WHEREOF the parties hereto have executed this agreement by
their respective duly authorized officers in that behalf, as of the day and year
first above written.
LANDLORD:
MILLENNIUM CORPORATE PARK L.L.C., A
WASHINGTON LIMITED LIABILITY COMPANY
By: Continental Pacific, Inc., a
Washington corporation,
its managing member
By:
-----------------------------
Its:
-----------------------------
TENANT:
MOSAIX, INC., a
Washington corporation
By: [SIG]
------------------------------------
Its: President and CEO
------------------------------------
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LANDLORD NOTARY
STATE OF WASHINGTON )
) ss.
COUNTY OF KING )
I certify that I know or have satisfactory evidence that the person
appearing before me and making this acknowledgment is the person whose true
signature appears on this document.
On this ____ day of ________________, 1997, before me personally
appeared ________________________, to me known to be the ____________ of
Continental Pacific, Inc., a member of MILLENNIUM CORPORATE PARK L.L.C., the
limited liability company that executed the within and foregoing instrument, and
acknowledged the said instrument to be the free and voluntary act and deed of
said limited liability company, for the uses and purposes therein mentioned, and
on oath stated that he/she was authorized to execute said instrument.
WITNESS my hand and official seal hereto affixed the day and year first
above written.
[ S E A L ]
--------------------------------------
Notary Public in and for the State
Of Washington, residing at ___________
My commission expires:________________
--------------------------------------
[Type or Print Notary Name]
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35
TENANT NOTARY
STATE OF WASHINGTON )
) ss.
COUNTY OF KING )
I certify that I know or have satisfactory evidence that the person
appearing before me and making this acknowledgment is the person whose true
signature appears on this document.
On this 11TH day of December, 1997, before me personally appeared
XXXXXXXX X. XXXXXXXX, to me known to be the PRESIDENT of MOSAIX, INC., the
corporation that executed the within and foregoing instrument, and acknowledged
the said instrument to be the free and voluntary act and deed of said
corporation, for the uses and purposes therein mentioned, and on oath stated
that he/she was authorized to execute said instrument and that the seal affixed,
if any, is the corporate seal of said corporation.
WITNESS my hand and official seal hereto affixed the day and year first
above written.
[ S E A L ] /S/ XXXXX X. XXXXX
Notary public in and for the State
XXXXX X. XXXXX Of Washington, residing at
Woodinville, WA
STATE OF WASHINGTON My commission expires: 11-9-98
XXXXX X. XXXXX
NOTARY PUBLIC [Type or Print Notary Name]
MY COMMISSION EXPIRES 11-09-98
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SCHEDULE "A"
(PLAN OF THE BUILDING)
BUILDING "C" LOCATION
00
XXXXXX XXXXX XX XXXXXXXX
XXXXX PLAN
38
SECOND FLOOR OF BUILDING
FLOOR PLAN
39
THIRD FLOOR OF BUILDING
FLOOR PLAN
40
SCHEDULE "A-1"
LEGAL DESCRIPTION
BUILDING "C" IN PHASE I OF MILLENNIUM CORPORATE PARK TO BE CONSTRUCTED ON A
PORTION OF THE LAND LEGALLY DESCRIBED IN THE ATTACHED EXHIBIT "A".
41
SCHEDULE "A-2"
RIGHT OF FIRST REFUSAL SPACE
BUILDING "B"
42
SCHEDULE "B"
TENANT IMPROVEMENTS
1. Plan for the Leased Premises.
(a) Landlord and Tenant have agreed to a space plan ("Space
Plan") and work letter ("Work Letter") for installation of the Tenant
Improvements in the Leased Premises. A copy of the Space Plan is attached hereto
as Schedule "B-1" and a copy of the Work Letter is attached hereto as Schedule
"B-2". The "Tenant Improvements" are set forth in detail in the Space Plan and
Work Letter and include, but are not limited to, locations and specifications of
doors, partitioning, ceilings, electrical fixtures, outlets and switches,
telephone outlets, floor coverings, window coverings, HVAC equipment, fire and
life safety equipment.
(b) As soon as reasonably possible after the execution of the
Lease, Landlord shall cause Landlord's Architect to coordinate the preparation
of final working drawings and specifications ("Working Drawings") for the Tenant
Improvements in the Leased Premises. All Working Drawings shall include, as
required, architectural, mechanical, electrical and structural engineering
drawings for installation of the Tenant Improvements in the Leased Premises in
accordance with the Space Plan and Work Letter.
(c) The Working Drawings shall be reviewed by Landlord and
Tenant for compliance with the Space Plan and Work Letter. They also shall be
submitted by Landlord to the appropriate governmental body for plan checking and
a building permit. Landlord shall make any changes in the Working Drawings
required to obtain the building permit. Tenant shall have five (5) working days
from its receipt of the Working Drawings to approve the Working Drawings in
writing. Tenant shall be deemed to have approved the Working Drawings if
Landlord fails to receive a reply or approval of the Working Drawings within
those five (5) working days.
2. Construction and Completion of Tenant Improvements. After the Working
Drawings have been prepared and approved, and a building permit for the Tenant
Improvements has been issued, Landlord shall enter into a construction contract
with its contractor for the installation of the Tenant Improvements in
accordance with the Working Drawings. Landlord shall supervise the completion of
such work and shall use its reasonable best efforts to secure Substantial
Completion (as defined below) of the Tenant Improvements by October 1, 1998.
Notwithstanding the foregoing, if Landlord shall be delayed in Substantially
Completing its work in accordance with the Space Plans and/or Working Drawings
as a result of Tenant's failure to approve any item or perform any other
obligation in accordance with and by the date specified herein; or Tenant's
request for materials, finishes or installations other than those readily
available; or Tenant's changes in the Working Drawings or Space Plan after
approval thereof by Tenant, then the Commencement Date shall not be extended by
any reason of Tenant delay. The terms "Substantial Completion," "Substantially
Complete" and words of similar import as used herein, shall mean the date that
Landlord's Architect certifies that the Tenant Improvements as described in this
Schedule B are substantially complete except for punch list items. Certification
by Landlord's architect of Substantial Completion of the Tenant Improvements in
accordance with the terms of this Schedule B shall be conclusive and shall be
binding upon Landlord and Tenant.
3. Penalty for Delay. Except in the event of a delay in Substantial
Completion caused in whole or in part by Tenant or caused by Force Majeure,
Landlord shall pay Tenant a penalty for a delay in Substantial Completion of the
Tenant Improvements beyond May 1, 1998 as follows:
(a) If Substantial Completion of the Tenant Improvements occurs
between May 2, 1998, and August 1, 1998, then Landlord shall pay Tenant a
penalty of $15,000 per month;
(b) If Substantial Completion occurs between August 2, 1998, and
November 1, 1998, then Landlord shall pay Tenant a penalty of $15,000 per month
for May, June, and July, and a penalty of $25,000 per month for August,
September and October;
(c) If Substantial Completion occurs between November 2, 1998,
and February 28, 1999, then Landlord shall pay Tenant a penalty of $15,000 per
month for May, June, and July, $25,000 per month for August, September and
October, and $50,000 per month for November, December, January, and February;
and
(d) If Substantial Completion occurs on or after March 1, 1999,
then Landlord shall pay Tenant a penalty of $15,000 per month for May, June, and
July, $25,000 per month for August, September and October, $50,000 per month for
November, December, January, and February, and from March 1, 1999 forward
Landlord shall pay Tenant a penalty equal to the hold-
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over penalty (excluding any late charges, default interest, or other obligations
of the Tenant), which Tenant actually pays to the landlord under the Existing
Lease. In the event Landlord is obligated to pay Tenant a penalty under this
subsection (d), Landlord shall have the right to negotiate directly with the
landlord under the Existing Lease for a reduction in Tenant's obligations
thereunder.
(e) Upon issuance of Landlord's building permits for the Building,
Landlord shall notify Tenant of Landlord's anticipated date of Substantial
Completion (the "Updated Commencement Date"). Notwithstanding the above to the
contrary, if Substantial Completion occurs after the Updated Commencement Date,
then Landlord shall pay Tenant a penalty for each month of delay after the
Updated Commencement Date equal to the amount of monthly base rent (excluding
any late charges, default interest, or other obligations of the Tenant) which
Tenant actually pays to the landlord under the Existing Lease. The penalty paid
by Landlord under this subsection (e) shall be in lieu of any other applicable
penalty that would be due under subsections (a) through (d) above for the time
period following the Updated Commencement Date. In the event Landlord is
obligated to pay Tenant a penalty under this subsection (e), Landlord shall have
the right to negotiate directly with the landlord under the Existing Lease for a
reduction in Tenant's obligations thereunder.
(f) If Substantial Completion occurs on a date other than the
first day of a calendar month, any applicable penalty shall be pro-rated based
on the actual numbers of days in such calendar month.
4. Cost of Tenant Improvements.
(a) The Tenant Improvements shall be paid for by Landlord up to a
cost of $3,803,040.00 ("Tenant Improvement Allowance"). That portion of the cost
of the Tenant Improvements which exceeds the Tenant Improvement Allowance shall
be paid by Tenant in advance by a cash deposit with Landlord in the full amount
of the cost of the Tenant Improvements which exceeds the Tenant Improvement
Allowance; provided, that if not all of the excess costs can be determined prior
to construction, then Tenant shall pay the portion which can be determined in
advance in cash prior to the commencement of the work and the balance of such
excess costs within ten (10) days after Landlord's written demand for payment
which demand shall set forth in reasonable detail the costs to be paid. The
Tenant Improvement Allowance (and Tenant's payment for excess costs, if any)
will be used to pay for the costs of constructing and installing the Tenant
Improvements and Building Common Areas including, without limitation, Building
lobbies, restrooms, showers, HVAC systems and dropped ceilings; Washington State
Sales Tax; Landlord's reasonable construction coordination fee; and other costs
and expenses incurred by Landlord under this Schedule B; provided, that the
Tenant Improvement Allowance shall not be used to pay any costs associated with
Tenant's telephone, computer and/or data services or related cabling with
respect thereto, all of which costs shall be paid solely by Tenant.
(b) Any change in specifications in the Space Plan, or in the Working
Drawings after the initialling thereof by Landlord and Tenant, made at Tenant's
request after the date of the execution of the Lease shall be made only after
prior written approval of Landlord and shall be made at Tenant's sole cost and
expense. The costs and expenses associated with any changes shall include any
architectural, mechanical, electrical and structural engineering drawings, plans
and specifications required by the changes.
5. Punch List Items. Immediately prior to Tenant's occupancy of the
Leased Premises, Landlord and Tenant shall jointly inspect the Tenant
Improvements and create a written punch-list setting forth the additional
corrective work to the Tenant Improvements are required to be performed pursuant
to the Space Plan. Landlord shall promptly take such measures as are reasonably
necessary to correct such punch-list items.
6. Additional Allowance. In addition to the Tenant Improvement
Allowance, Tenant shall, at Tenant's option, be entitled to receive an
additional allowance toward the cost of the Tenant Improvements in the amount of
$5.00 per useable square foot of the Leased Premises (the "Additional
Allowance"). If Tenant desires to utilize the Additional Allowance, Tenant shall
provide Landlord written notice thereof at the time the Space Plan is approved.
If Tenant exercises its right to utilize the Additional Allowance by giving
Landlord written notice thereof at the time of Space Plan approval, Landlord
shall apply the Additional Allowance towards the cost of the Tenant Improvements
and Tenant shall pay to Landlord, as additional Basic Triple Net Rent, an amount
equal to the Additional Allowance, together with interest thereon at the Prime
Rate, in equal monthly installments amortized over the initial Term. The first
installment shall be due at the same time as the first payment of Basic Triple
Net Rent and all future installments shall be due at the same time and in the
same manner as payments of Basic Triple Net Rent.
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7. Interior Space Consultant Allowance. In addition to the Tenant
Improvement Allowance, Landlord shall provide Tenant with an allowance of up to
$90,000 (the "Interior Space Consultant Allowance") for Tenant's actual costs of
interior design and construction administration consultant services for the
Leased Premises. The Interior Space Consultant Allowance will be paid by
Landlord directly to Tenant's interior space planner within thirty (30) days
after Landlord's receipt of Tenant's written invoices for payment and evidence
reasonably satisfactory to Landlord of the cost of Tenant's interior space
consultant services.
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SCHEDULE "B-1"
SPACE PLAN
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SCHEDULE "C"
RULES AND REGULATIONS
1. The sidewalks, entrances, passages, courts, elevators, vestibules,
stairways, corridors or halls shall not be obstructed or encumbered by
any tenant or used for any purpose other than ingress and egress to and
from the Leased Premises.
2. No awnings or other projections shall be attached to the outside walls
of the Building. All curtains, blinds, shades or screens attached to or
hung in or used in connection with any window or door of the Leased
Premises shall be subject to the approval of the Landlord.
3. Interior signs on doors and the directory shall be inscribed, painted or
affixed for each tenant by the Landlord at the expense of the Tenant,
and shall be of a size, color and style acceptable to the Landlord.
4. The skylights, windows and doors that reflect or admit light and air
into the halls, passageways or other public places in the Building shall
not be covered or obstructed by any tenant, nor shall any bottles,
parcels or other articles be placed on the window xxxxx.
5. The water and wash closets and other plumbing fixtures shall not be used
for any purpose other than those for which they were constructed, and no
sweepings, rubbish, rags, or other substances shall be thrown therein.
All damages resulting from any misuse of the fixtures shall be borne by
the tenant who, or whose servants, employees, agents, visitors or
licensees, shall have caused the same.
6. No tenant shall xxxx, paint, drill into, or in any way deface any part
of the Leased Premises or the Building. No boring, cutting or stringing
of wires shall be permitted, except with the prior written consent of
the Landlord, and as the Landlord may direct.
7. No bicycles, vehicles or animals of any kind shall be brought into or
kept in or about the Leased Premises. No tenant shall cause or permit
any unusual or objectionable odors to be produced upon or emanate from
the Leased Premises.
8. No additional locks or bolts of any kind shall be placed upon any of the
doors or windows by any tenant, nor shall any changes be made in
existing locks or the mechanism thereof. Each tenant must, upon the
termination of its tenancy, restore to the Landlord all keys of stores,
offices and toilet rooms, either furnished to, or otherwise procured by,
such tenant, and in the event of the loss of any keys, so furnished,
such tenant shall pay to the Landlord the cost thereof.
9. All removals, or the carrying in or out of any safes, freight, furniture
or bulky matter of any description must take place during the hours
which the Landlord or its agent may determine from time to time. The
Landlord reserves the right to inspect all freight to be brought into
the Building and to exclude from the Building all freight which violates
any of these Rules and Regulations or the Lease of which these Rules and
Regulations are a part.
10. The Leased Premises shall not be used for lodging or sleeping or for any
illegal purpose.
11. Canvassing, soliciting and peddling in the Development is prohibited and
each tenant shall co-operate to prevent the same.
12. There shall not be used in any space, or in the public halls of the
Building, either by any tenant or by jobbers or others, in the delivery
or receipt of merchandise, mail or other materials, any hand trucks,
except those equipped with rubber tires and side guards. No hand trucks
shall be used in passenger elevators.
13. The Tenant shall not have or permit or cause to be on the Leased
Premises any machines selling merchandise or services or providing
entertainment, whether by coins, credit cards or otherwise, unless
expressly approved by the Landlord in writing.
14. The Tenant shall not have or permit any public address, music broadcast
or other sound system which may be heard beyond the limits of the Leased
Premises.
15. Tenant shall not waste electricity, water or air conditioning and agrees
to cooperate fully with Landlord to assure the most effective operation
of the Building's heating and air conditioning and to comply with any
governmental energy-saving rules, laws or regulations
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of which Tenant has actual notice, and shall refrain from attempting to
adjust controls. Tenant shall keep corridor doors closed, and shall
close window coverings at the end of each business day.
16. Tenant shall not install any radio or television antenna or other
devices on the roof(s) or exterior walls of the Building. Tenant shall
not interfere with radio or television broadcasting or reception from or
in the Development or elsewhere.
17. Tenant shall store all its trash and garbage within its Leased Premises
or in other facilities provided by Landlord. Tenant shall not place in
any trash box or receptacle any material which cannot be disposed of in
the ordinary and customary manner of trash and garbage disposal. All
garbage and refuse disposal shall be made in accordance with directions
issued from time to time by Landlord.
18. Tenant shall comply with all safety, fire protection and evacuation
procedures and regulations established by Landlord or any governmental
agency.
19. Tenant assumes any and all responsibility for protecting its Leased
Premises from theft, robbery and pilferage, which includes keeping doors
locked and other means of entry to the Leased Premises closed.
20. Tenant's requirements will be attended to only upon appropriate
application to the Development management office by an authorized
individual. Employees of Landlord shall not perform any work or do
anything outside of their regular duties unless under special
instructions from Landlord, and no employee of Landlord will admit any
person (Tenant or otherwise) to any office without specific instructions
from Landlord.
21. Landlord may waive any one or more of these Rules and Regulations for
the benefit of Tenant or any other tenant, but no such waiver by
Landlord shall be construed as a waiver of such Rules and Regulations in
favor of Tenant or any other tenant, nor prevent Landlord from
thereafter enforcing any such Rules and Regulations against any or all
of the tenants of the Development.
22. These Rules and Regulations are in addition to, and shall not be
construed to in any way modify or amend, in whole or in part, the terms,
covenants, agreements and conditions of the Lease.
23. Landlord reserves the right to make such other and reasonable Rules and
Regulations as, in its judgment, may from time to time be needed for
safety and security, for care and cleanliness of the Development and for
the preservation of good order therein. Tenant agrees to abide by all
such Rules and Regulations hereinabove stated and any additional rules
and regulations which are adopted.
24. Tenant shall be responsible for the observance of all of the foregoing
rules by Tenant's employees, agents, clients, customers, invitees and
guests.
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SCHEDULE "D"
Tenant Estoppel Certificate
(Example Only)
RE: Lease Dated:
Landlord:
Premises:
Rent Amount:
Lease Term:
To whom it may concern:
Tenant represents and certifies knowing that the reader is relying on the
contents the following:
1. That Tenant is the tenant under the above described Lease and the Lease is in
full force and effect and has not been amended since the date of the Lease,
except as follows:
2. Tenant has taken possession of the premises, such possession having been
delivered by Landlord and having been accepted by Tenant.
3. That the improvements, space, parking and common area facilities, if any,
required to be furnished have been completed in all respects to the satisfaction
of Tenant and have been accepted and are in use by Tenant, its customers,
employees and invitees.
4. Tenant knows of no existing default by Landlord. Tenant does not have a claim
against Landlord which might be set off or credited against future accruing
rents.
5. No rents have been prepaid except as provided by the Lease.
6. The Basic Triple Net Rent for the premises is $____________ per month and the
total rentable square footage is __________ square feet. The current Additional
Rent for the premises is $____________ per month.
7. Rent started on __________, 19__, and rent is paid to __________, 19__.
8. A security deposit of $____________ was paid to Landlord.
9. If by foreclosure or otherwise, the lender, its successor or assigns
("Lender") comes into possession of the premises, then Tenant agrees to attorn
to, be liable to, and recognize Lender as Landlord under the Lease and be bound
by all the obligations imposed by the Lease on Tenant.
10. No actions, whether voluntary or otherwise, are pending against Tenant under
the bankruptcy laws of the United States.
11. Tenant will give prompt written notice to Lender, at such address as Lender
may designate, if Landlord defaults under the Lease giving Lender details of the
nature of the default. Prior to terminating the Lease for any reason before the
expiration of the Lease Term, Tenant will allow Lender 30 days after receipt of
notice to rectify or cure the default constituting the basis of the termination.
Dated: ____________________
Tenant:
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EXHIBIT A
CHICAGO TITLE INSURANCE COMPANY
A.L.T.A. COMMITMENT
SCHEDULE A
(Continued)
Order No.: 457560
Your No.: XXXXXX PROPERTY
-------------------------------------------------------------------------------
LEGAL DESCRIPTION EXHIBIT
(Paragraph 4 of Schedule A continuation)
THAT PORTION OF THE EAST HALF OF THE SOUTHWEST QUARTER OF SECTION 6, TOWNSHIP
25 NORTH, RANGE 6 EAST, WILLAMETTE MERIDIAN, IN KING COUNTY, WASHINGTON, LYING
NORTHERLY OF THE NORTH MARGIN OF NORTHEAST UNION HILL ROAD;
TOGETHER WITH THAT PORTION OF GOVERNMENT XXXX 0 XXX 0 XX XXXXXXX 0, XXXXXXXX
00 XXXXX, RANGE 6 EAST, WILLAMETTE MERIDIAN, IN KING COUNTY, WASHINGTON, LYING
NORTHERLY OF THE NORTH MARGIN OF NORTHEAST UNION HILL ROAD AND EASTERLY OF THE
FOLLOWING DESCRIBED LINE:
BEGINNING AT THE INTERSECTION OF THE NORTH MARGIN OF NORTHEAST UNION HILL ROAD
WITH THE WEST LINE OF GOVERNMENT LOT 7;
THENCE NORTH 80 DEGREES 03'32" EAST ALONG SAID NORTH MARGIN 515.00 FEET;
THENCE NORTH 02 DEGREES 14'11" EAST 2191.78 FEET TO A POINT ON THE NORTH LINE
OF SAID GOVERNMENT LOT 6, DISTANT 545.75 FEET EAST, AS MEASURED ALONG SAID
NORTH LINE, FROM THE NORTHWEST CORNER THEREOF AND THE TERMINUS OF SAID LINE;
EXCEPT ANY PORTION THEREOF LYING NORTHERLY OF THE CENTERLINE OF BEAR CREEK AND
XXXXXX CREEK, SAID CENTERLINES BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS:
BEGINNING AT THE INTERSECTION OF THE NORTH MARGIN OF SAID NORTHEAST UNION HILL
ROAD WITH THE WEST LINE OF SAID GOVERNMENT LOT 7;
THENCE NORTH 80 DEGREES 03'32" EAST ALONG SAID NORTH MARGIN 515.00 FEET;
THENCE NORTH 02 DEGREES 14'11" EAST 679.60 FEET TO SAID CENTERLINE OF BEAR
CREEK AND THE TRUE POINT OF BEGINNING OF SAID DESCRIBED LINE;
THENCE NORTHEASTERLY ALONG THE CENTERLINE OF BEAR CREEK AND XXXXXX CREEK THE
FOLLOWING COURSES:
THENCE SOUTH 77 DEGREES 53'16" EAST 117.10 FEET;
THENCE NORTH 81 DEGREES 16'20" EAST 95.53 FEET;
THENCE NORTH 76 DEGREES 48'29" EAST 151.88 FEET;
THENCE NORTH 72 DEGREES 38'17" EAST 129.88 FEET;
THENCE NORTH 85 DEGREES 08'33" EAST 118.81 FEET;
THENCE SOUTH 70 DEGREES 52'10" EAST 80.73 FEET;
THENCE SOUTH 86 DEGREES 12'17" EAST 103.83 FEET;
THENCE NORTH 74 DEGREES 27'30" EAST 93.10 FEET;
THENCE NORTH 66 DEGREES 48'56" EAST 141.68 FEET;
THENCE NORTH 72 DEGREES 54'14" EAST 96.15 FEET;
THENCE NORTH 60 DEGREES 28'37" EAST 43.05 FEET;
THENCE NORTH 56 DEGREES 52'39" EAST 85.84 FEET;
THENCE NORTH 84 DEGREES 58'45" EAST 99.88 FEET;
THENCE NORTH 35 DEGREES 12'27" EAST 66.37 FEET;
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CHICAGO TITLE INSURANCE COMPANY
50
EXHIBIT A (continued)
CHICAGO TITLE INSURANCE COMPANY
A.L.T.A. COMMITMENT
SCHEDULE A
(Continued)
Order No.: 457560
Your No.: XXXXXX PROPERTY
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LEGAL DESCRIPTION EXHIBIT
(Paragraph 4 of Schedule A continuation)
THENCE NORTH 76 DEGREES 31'20" EAST 65.11 FEET;
THENCE NORTH 85 DEGREES 47'58" EAST 88.54 FEET;
THENCE SOUTH 86 DEGREES 45'20" EAST 85.89 FEET;
THENCE NORTH 72 DEGREES 43'20" EAST 85.47 FEET;
THENCE SOUTH 88 DEGREES 38'44" EAST 37.29 FEET;
THENCE SOUTH 69 DEGREES 21'52" EAST 19.70 FEET;
THENCE SOUTH 52 DEGREES 44'57" EAST 57.69 FEET;
THENCE SOUTH 84 DEGREES 58'59" EAST 37.73 FEET;
THENCE NORTH 79 DEGREES 51'55" EAST 89.63 FEET;
THENCE NORTH 82 DEGREES 02'53" EAST 149.28 FEET TO THE EAST LINE
OF SAID EAST HALF OF THE SOUTHWEST QUARTER OF SECTION 6 AND THE TERMINUS OF SAID
DESCRIBED LINE.
(ALSO KNOWN AS REVISED PARCEL 4 OF CITY OF XXXXXXX LOT LINE REVISION NO.
LLR94-016, RECORDED UNDER RECORDING NUMBER 9603049006.)
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CHICAGO TITLE INSURANCE COMPANY
51
SCHEDULE B-2
WORK LETTER
GENERAL DESCRIPTION
The following specifications shall be read in conjunction with the schematic
space plan to be prepared by JPC and the schematic shell and core documents
prepared by Xxxxxx Partners dated June 5, 1997. The drawings and specifications
represent the Tenant's design intent for the purposes of budgeting and
definition of interior improvements for allocation of Tenant Improvement
Allowance.
OWNER RESPONSIBILITIES
A. GENERAL:
1. Codes and Ordinances -- The Building Shell and Interior Improvements
shall comply with all applicable codes as enforced by the City of
Xxxxxxx.
2. Permits -- The cost of all permits, fees, and licenses required for
construction of the shell shall be paid by Landlord.
3. Final Inspections -- Landlord shall be responsible for obtaining final
inspection from all governing agencies as required to obtain Certificate
of Occupancy for the building shell at Landlord's cost. Landlord shall
coordinate final inspections required to obtain Certificate of
Occupancy of the Tenant premises at Tenant's cost (Tenant Improvement
Allowance).
4. Schedules -- Landlord shall provide and maintain a detailed schedule of
construction and occupancy based on agreed upon delivery dates for
tenant provided materials, equipment, and furnishings. Landlord shall
notify Tenant in writing of any tenant provided information or
approvals that will affect the schedule. Tenant shall be given
reasonable time to provide the requested information.
B. IMPROVEMENTS TO BE PROVIDED BY LANDLORD:
1. SIGNAGE -- Landlord shall provide a tenant monument sign adjacent to
Building C. Landlord shall also provide signage for disabled and
visitor parking stalls near the entrance to the building. All signage
must conform to the City of Xxxxxxx Sign Code Standards.
2. Sign Lighting -- Landlord shall provide adequate site and parking area
lighting customary to suburban office parks and as required by City of
Xxxxxxx Code.
3. Floors -- Landlord shall provide cured and sealed concrete floors that
are level to within industry standards and ready to receive tenant's
finish flooring.
4. Lobby Stairwell -- Landlord to provide unfinished lobby stairwell.
Tenant is responsible for hand rail and finishes.
5. Perimeter Stairwells -- Landlord to provide one unfinished stairwell at
each end of building as shown on plan. Tenant is responsible for all
finishes.
6. Elevator -- Landlord shall provide two 2500 lb hydraulic elevators.
Tenant is responsible for cab finishes.
7. Insulation -- Landlord will insulate the building slab, roof, and all
piping, waterlines, and rain leaders as required by code. All exterior
wall insulation and acoustical insulation of ceilings and partitions
will be part of Tenant Improvements.
8. Sprinkler -- Landlord shall provide a complete sprinkler system to meet
local standards based on class B occupancy. All downheads and head
modifications due to Tenant Improvement partitioning are part of Tenant
Improvements.
9. Plumbing -- Plumbing will include installation of a 2" copper waterline
which will run below the second floor deck, approximately at the
building center. A 6" sewer drain line will run under-slab. Included
are related shut-off valves, clean-outs, and other miscellaneous items.
Landlord shall provide rough plumbing associated with Toilet Rooms,
Shower Rooms, drinking fountains on each floor, roof drains and
miscellaneous core drain waste and vent piping per standard building
design.
10. Exhaust -- Landlord shall provide exhaust fan and ductwork for Toilet
Room and Shower Room exhaust per standard building design.
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11. Fire Alarm System - Landlord to provide a sprinkler system alarm
including flow and tamper switches as required by code for shell letter.
TENANT IMPROVEMENTS
A. GENERAL:
1. Tenant Improvement Work - The Tenant Improvement Items defined herein
consists of work items approved by Landlord to be paid out of the Tenant
Improvement Allowance. Unless otherwise addressed all Tenant
Improvements will be constructed to a level of quality and finish which
meets or exceeds Landlord's building standards.
2. Codes and Ordinances - The Tenant Improvements shall comply with all
applicable codes as enforced by the City of Xxxxxxx.
3. Permits - The cost of all permits, fees, and licenses required for
construction of the Tenant Improvements shall be paid out of the Tenant
Improvement Allowance.
4. Schedules - Tenant will provide Landlord with completed specifications
and drawings of its Tenant Improvements no later than ____________,
1997. Tenant will provide "Tenant Provided" materials, equipment, and
furnishings within the time frames specified by Landlord provided that
that Landlord gives Tenant reasonable prior notice to provide such
items.
B. TENANT IMPROVEMENT ITEMS:
1. Patio - Construction of an outdoor patio area on the West side of
Building C providing said patio does not interfere with project
walkways, parking or Building B - Size and exact location are subject to
Landlord's approval.
2. Raised Access Flooring - Computer Room shall receive 12" height raised
access flooring with ramp and handrail.
3. Food Services - Food service equipment associated with cafeteria and
coffee break areas, such as refrigerators, microwaves, dishwashers,
garbage disposals, refrigerated display cases, sinks, cooking surfaces,
etc. and all required plumbing, venting, and fire suppression systems.
4. Signage - Purchase and installation of tenant signage mounted to face of
building as allowed by City Ordinances and subject to approval by
Landlord.
5. HVAC - Purchase and installation of HVAC system for the building -
Tenant shall have the right to review and approve the proposed system to
assure the system provides the level of control and capacity required
for tenant's loads. Tenant will require 24 hour and/or extended hours
HVAC in designated areas of the building.
6. Restrooms - Tenant to provide finished restrooms in the locations
designated on building plan. Minimum restrooms finish will include
toilet partitions, plastic laminate countertops with mirror above and
ceramic tile on floors, base and wet walls. Other walls to receive vinyl
wall covering.
7. Shower Rooms - Tenant will be responsible for installing shower stalls.
8. Entry and Elevator Lobbies - Tenant to provide a first floor entry lobby
with building standard finishes or better.
9. Electrical - Tenant shall provide one 2,400 Amp, 277/480V, 3 phase,
4-wire service. House power to include a 200 Amp, 277/480V panel; 15 KVA
transformer and 60 Amp, 120/208V sub-panel.
10. Sprinklers - All downheads and head modifications due to Tenant
Improvement Partitioning - Tenant may choose to purchase and install a
preaction sprinkler system for the Computer Room.
11. Electrical Work - All electrical work necessary to install the Tenant's
electrical service and distribution system.
12. Emergency Generator - Emergency Generator and associated sitework and
infrastructure - size and location are subject to Landlord's Approval.
13. Frames - Hollow metal frames located in shipping/receiving, and
cafeteria areas.
14. Exterior Doors - One pair of 3'-0" x 7'-0" exterior doors at
shipping/receiving area.
15. Lighting - Installation of building standard or better lighting -
Tenant may choose to install an indirect lighting system for the open
office areas.
53
16. Relites - Wood frame relites with 1/4" tempered glass shall be located
as indicated on space plan subject to City approval
17. Security System - Provision and installation, including rough in, of a
card access or security system
18. Partitions & Exterior Walls - All interior partitions and the furring,
insulation and finish of all exterior walls
19. Window Coverings - All window coverings
BUILDING STANDARDS
All building standards are subject to Landlords finalization of Building
Standard Specifications, however said Building Standards will generally include
the following:
BUILDING STANDARDS
All building standards are subject to Landlords finalization of Building
Standard Specifications, however said Building Standards will generally include
the following:
1. Finish Carpentry and Millwork - Millwork shall consist of countertops,
cabinets, shelving and trim and shall be constructed as follow:
Quality: Custom grade matching commercial
standard product lines using European
style construction. Marine grade plywood
shall be used at all cafeteria
countertops.
Door Design: Flush Overlay
Hinges: Concealed, Xxxx or equal
Pulls: Wire type, finish to match hardware
Millwork Finish: All surfaces shall have plastic
laminate, matte finish, Wilsonart or
equal
Backsplash: 4" plastic laminate in all wet areas
2. Finish Carpentry - All wood finish material shall be pre-finished stain
grade birch solids and veneers.
3. Doors - All interior doors shall be 1 3/4" x 3'-0" x 7'-0". Doors shall
be solid core Birch veneer with solid hardwood edge and stained finish.
4. Frames - All interior frames shall be birch, finish to match doors.
Jambs to be fire-rated where required by code.
5. Hardware - Hardware shall be specified to meet tenant's security and
access requirements. Locks and latches shall be commercial grade with
lever handle.
6. Interior Partitions - Building standard partition shall consist of 5/8"
GWB over 2 1/2" metal studs at 2'-0" O.C. with 1/2" reveal at ceiling.
7. Core Partitions - Core wall partitions shall have taped and finished
GWB surface.
8. Ceiling - Ceilings may consist of GWB over metal stud framing for
limited soffited areas, or lay-in acoustical tile ceilings in suspended
metal grid for the primary ceiling.
9. Light Fixtures - 2x4 parabolic deep cell, 3 lamp with electronic
ballasts.
10. Carpet - 28 oz. loop pile, glued down.
11. Base - 4" Rubber base.
12. Paint - Eggshell finish, applied in two coats over primer.
13. Window Coverings - Horizontal 1" mini-blinds at all exterior windows.
