EXHIBIT 10.30
LEASE AGREEMENT
BETWEEN
XXXX/RISE L.L.C.,
LANDLORD
AND
ETMA CORPORATION,
TENANT
LEASE AGREEMENT
THIS LEASE is made as of this 13th day of December, 2002, between
XXXX/RISE L.L.C., a Washington limited liability company ("Landlord"), and ETMA
CORPORATION, a Washington corporation ("Tenant").
Landlord and Tenant agree:
1. BASIC LEASE INFORMATION AND EXHIBITS. The following terms as used
herein shall have the meanings provided in this Section 1, unless otherwise
specifically modified by provisions of this Lease:
(a) Lease Date: December 13, 2002
(b) Tenant: ETMA Corporation
(c) Tenant Address: 0000 X. Xxxxxx Xxxxx
Xxxxx, XX 00000-0000
(d) Landlord: XXXX/RISE L.L.C.
(e) Landlord Address: 00000 XX 00xx Xxxxxx
Xxxxxxx, XX 0000-0000
(f) Premises: 100% of the rentable space in the Building
(g) Building: The building known as the Westar Building
located at 0000 - 000xx Xxxxxx X.X. in Redmond, King
County, Washington, situated on the Land
(h) Land: The real property more particularly described
on Exhibit A attached hereto.
(i) Lease Term: Approximately, five (5) years, commencing
on January 1, 2003 (the "Commencement Date") and
terminating on December 31, 2008 (the "Termination
Date")
(j) Basic Rent: $360,000 annually; $30,000 monthly.
(k) Additional Rent: All costs, other than Basic Rent,
payable by Tenant to Landlord hereunder.
(l) Security Deposit: $__________
(m) Rentable Square Feet in the Premises: 32,000
(n) Rentable Square Feet in the Building: 32,000
(o) Tenant's Pro Rata Share: 100%
(p) Exhibits: Exhibit A - Legal Description of the Land
Exhibit B - Memorandum of Lease
2. LEASE OF PREMISES. Landlord does hereby lease to Tenant, and
Tenant does hereby lease from Landlord, upon the terms and conditions herein set
forth, the Premises described in Section l(f) hereof on the Land as described in
Exhibit A attached hereto and incorporated herein, together with rights of
ingress and egress over the Land and all common areas more particularly
described on Exhibit A attached hereto.
3. COMMENCEMENT, EXPIRATION AND EXTENSION OF LEASE TERM. The term
of this Lease shall commence on the Commencement Date specified in section l(i)
hereof and shall expire upon the Termination Date specified in Section 1(i) or
earlier termination in accordance with this Lease.
Tenant shall have the option to extend the Term (for purposes of this
paragraph, the "Initial Term") for two (2) additional period(s) of three (3)
year(s) each (the "Renewal Term(s)"); provided, however, that at the time of
Tenant's notice of its intent to exercise any such option, Tenant is not then in
default, subject to any applicable notice and cure periods. Tenant's occupancy
of the Premises during the Renewal Term(s) shall be governed by all of the
terms, conditions, covenants and provisions of the Lease, and, accordingly, the
Base Rent for the first year of any Renewal Term shall be increased in
accordance with Section 4(b) at the commencement of the Renewal Term(s). If
Tenant desires to exercise its option to extend the Initial Term or a Renewal
Term, it must give Landlord notice of its intent to do so at least ninety (90)
day(s) prior to the expiration of the Initial Term or then applicable Renewal
Tenn. The phrase "Term" shall be deemed to refer to the Initial Term and the
Renewal Term(s) to the extent applicable.
4. RENT.
(a) Basic Rent. Commencing with the Commencement Date,
Tenant shall pay to Landlord without notice the Basic Rent stated in Section
l(j) hereof without deduction or offset on the first day of each calendar month
during the term. Basic Rent and Additional Rent (together "Rent") for any
partial month shall be prorated in proportion to the number of days in such
month. Landlord's acceptance of less than the full amount of any payment due
from Tenant shall not be deemed an accord and satisfaction or compromise of such
payment unless Landlord specifically consents in writing to payment of such
lesser sum as an accord and satisfaction or compromise of the amount which
Landlord claims.
(b) Renewal Term Basic Rent Adjustment. In the event that
Tenant elects to exercise its option to extend the Term of this Lease in
accordance with the terms of Section 3, the Base Rent for each Renewal Term
shall be equal to the then fair market rate for similar space in comparable
buildings for comparable use in the geographic market east of Lake Washington;
provided, however, that in no event shall the Base Rent during a Renewal Term be
less than the Base Rent for the last year of the preceding Initial Term or
Renewal Term, as the case may be. The adjusted Base Rent shall commence on and
be payable on the first day of the Renewal Term and shall continue thereafter
throughout the Renewal Term.
The then fair market rate shall be determined on a triple net basis by
analyzing comparable lease transactions and lease renewals in a comparable
geographic market for office space east of Lake Washington. In analyzing
comparable transactions, all reasonable factors affecting rent shall be taken
into consideration, including, but not limited to, the building age, size, style
and condition and the date of the comparable lease.
If Landlord and Tenant cannot agree on a market rate for the Renewal
Term prior to sixty (60) days before termination of the Initial Term or first
Renewal Term, as the case may be, then both parties agree to use the appraisal
process, outlined as follows: Each party will hire an MAI
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appraiser. Each appraiser must have a minimum of five (5) years appraisal
experience in the market for office space east of Lake Washington. Each
appraiser shall complete his/her appraisal within thirty (30) days. If the
appraisers' opinions of the market rate differ by less than ten percent (10%) of
the amount of the higher appraisal; then the market rate shall be the average of
the two appraisals. If the appraisers' opinions of market rate differ by more
than ten percent (10%) of the higher appraisal then a third MAI appraiser
satisfying the same qualifications shall be mutually hired and paid for by both
parties. The third appraiser will evaluate the market using the same parameters
outlined in the preceding paragraph. The market rate estimate of the third
appraiser shall be averaged with the market rate estimate of the appraiser
closest to it. The Base Rent for the Renewal Term shall be the higher of the
resultant average rent utilizing this process or the Base Rent being paid at the
time of the renewal.
(c) Late Charge. If any sums payable by Tenant to
Landlord under this Lease are not received by the fifth (5th) day of each month,
Tenant shall pay Landlord in addition to the amount due, for the cost of
collecting and handling such late payment, an amount equal to the greater of
$100 or five percent (5%) of the delinquent amount. In addition, all delinquent
sums payable by Tenant to Landlord and not paid when due shall bear interest at
the rate of eighteen percent (18%) per annum, or the highest rate of interest
allowable by law, whichever is less. Interest on all delinquent amounts shall be
calculated from the original due date to the date of payment.
5. ADDITIONAL TAX & OPERATING COSTS.
(a) Tax Rent. In addition to Basic Rent, Tenant shall pay
to Landlord Tenant's Pro Rata Share of Real Property Taxes (sometimes referred
to herein as Tax Rent) including real and personal property taxes, local
improvement districts, assessments, and other governmental impositions and
charges of every kind and nature, now or hereafter imposed, including surcharges
with respect thereto, which may during the Term of this Lease be levied,
assessed, imposed, or otherwise become due and payable with respect to the
Building including tenant improvements and all improvements, fixtures, and
equipment thereon, or the use, occupancy or possession thereof; taxes on any
personal property of Tenant which have not been paid by Tenant directly to the
taxing authority; costs and expenses, including costs of appraisers, attorneys
and consultants incurred in negotiating, reviewing or appealing any taxes; and
any taxes levied or assessed in addition to, in lieu of, or as a substitute for,
in whole or part, taxes now levied or assessed or any other tax upon owning,
leasing or rents receivable by Landlord from the Building, but not including any
federal or state income tax imposed on Landlord or any federal, state, county or
municipal franchise, income or unincorporated business tax, or any estate,
inheritance, succession, capital stock, transfer or capital gains tax, levied
upon Landlord. "Tenant's Share of Real Property Taxes" shall mean the amount of
Real Property Taxes payable during any calendar year by Landlord multiplied by
Tenant's Pro Rata Share. Tenant shall pay Tenant's Pro Rata Share of Real
Property Taxes within ten (10) days after receipt of an invoice for payment from
Landlord. If any or all of the Taxes paid hereunder are by all applicable laws
governing the Premises (collectively, the "Law") permitted to be paid in
installments, notwithstanding how Landlord pays the same, then, for purposes of
calculating Taxes, such Taxes shall be deemed to have been divided and paid in
the maximum number of installments permitted by Law, and there shall be included
in Taxes for each year only such installments as are required by Law to be paid
within such year, together with interest thereon and on future
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such installments as provided by Law. If Taxes are not contested by Landlord,
Tenant shall have the right to contest such Taxes, at no cost or expense to
Landlord, by the appropriate proceedings diligently contested in good faith.
Notwithstanding such proceedings, the contested Taxes shall be promptly paid and
discharged, unless such proceedings (and where necessary the posting of an
appropriate bond or other security) shall operate to prevent or stay the
collection of the Taxes and secure any accruing penalties or interest and to
cure Landlord's default in the payment of Taxes required under any mortgage upon
the Property. Landlord shall join Tenant in such proceedings, if necessary,
provided that Tenant pays all reasonable costs and expenses incurred by
Landlord. If Landlord obtains a refund of Taxes for any Lease Year after Tenant
has paid its share of Taxes for such Lease Year, then Tenant shall be
immediately refunded its share of any refund received by Landlord, less any
expenses incurred by Landlord in securing such refund.
(b) Tenant's Property Taxes. Tenant shall pay, prior to
delinquency, all real or personal property taxes payable with respect to all
property of Tenant located on the Premises or the Building and promptly upon
request of Landlord shall provide written proof of such payment.
(c) Operating Costs. In addition to the Basic Rent and
Tax Rent, Tenant shall pay to Landlord Tenant's Pro Rata Share of Operating
Costs, which are all expenses paid or incurred by Landlord for maintaining,
operating and repairing the Building and the Common Areas, the Land, and the
equipment and personal property used in conjunction therewith, including,
without limitation, the following: the costs of refuse collection; water, sewer,
electricity, heating, lighting, air conditioning, ventilation and other
utilities services; supplies and cleaning services; services of independent
contractors; compensation (including employment taxes and fringe benefits) of
employees and contractors engaged in the management, operation and maintenance
of the Land and/or the Building (but only to the extent such employees and
contractors are directly engaged in such management, operation and maintenance);
the maintenance and repair of parking areas, curbs, landscaping, lighting and
outdoor facilities; licenses, permits and inspection fees; taxes; liability,
casualty and property insurance for the Building, the Land, and all Common
Areas; periodic painting of the Building; customary management fees; legal and
accounting expenses and any other expense or charge whether or not hereinabove
described which in accordance with generally accepted accounting and management
practices would be considered an expense of maintaining, operating or repairing
the Building, the Land, and Common Areas. Notwithstanding the foregoing, there
shall be no duplication of any particular cost, charge or expense in any of the
Operating Costs invoiced to Tenant as Additional Rent or Rent.
Notwithstanding the foregoing, Tenant shall not be required to pay for
any of the following: (1) capital improvements made to the Building other than
the costs for improvements made to the Building or Land, as applicable which,
although capital in nature, are (i) expected to reduce the normal Operating
Costs (including all utility costs) of the Building or Land, as applicable, as
amortized using a commercially reasonable interest rate over the time period
reasonably estimated by Landlord to recover the costs thereof taking into
consideration the anticipated cost savings, as determined by Landlord using its
good faith, commercially reasonable judgment; (2) the cost of correcting defects
in the construction of the Building or in the Building Systems not caused by
Tenant; (3) the cost of any repair in accordance with the casualty and
condemnation sections of this Lease; (4) any expenses for repairs or maintenance
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which are covered by warranties and service contracts; (5) the cost of
correcting latent defects in the Building, latent defects in the Premises
(except for Tenant's Alterations) and defects in base building construction for
the Building, the Building Systems, the parking area, and other common areas.
The term "Building Systems" shall mean the Premises' HVAC, life-safety,
plumbing, electrical, and mechanical systems.
Prior to the commencement of each calendar year or portion thereof, or
as soon thereafter as practicable, Landlord shall furnish Tenant a written
statement of the Estimated Costs Allocable to the Premises for such Calendar
Year, and a calculation of the Common Area Rent as follows: One-twelfth (1/12)
of such amount shall be Additional Rent payable by Tenant with installments of
Basic Rent. Within 90 days after the close of each calendar year or portion
thereof, or as soon thereafter as practicable, Landlord shall deliver to Tenant
a written statement setting forth the Actual Costs Allocable to the Premises
during the preceding calendar year. If such costs for any calendar year exceed
Estimated Costs Allocable to the Premises paid by Tenant to Landlord, Tenant
shall pay the amount of such excess to Landlord as Additional Rent within 30
days after receipt of such statement by Tenant. If such statement shows such
costs to be less than the amount paid by Tenant to Landlord, then the amount of
such overpayment by Tenant shall be credited by Landlord to the next succeeding
installment of Basic Rent payable by Tenant; provided, however, if the Term has
ended, Landlord shall, within thirty (30) days after Tenant's receipt of
Landlord's statement if no Event of Default then exists hereunder, refund any
portion thereof Landlord has not applied to other amounts owed by Tenant to
Landlord hereunder. Landlord shall keep and make available to Tenant or its
representative in Landlord's, or Landlord's agent's, office, books and records
detailing the Operating Costs for that Calendar Year for a period of twelve (12)
months after delivery of Landlord's statement. Landlord shall permit Tenant's
representatives, at Tenant's cost and expense (except as set forth below), to
examine and audit such books and records to verify such Landlord's statement at
reasonable times during business hours at the place where Landlord's records are
kept, subject to the following conditions: (i) Tenant must provide Landlord not
less than thirty (30) days' prior written notice of the Tenant's election to
audit (the "Tenant's Notice of Audit"), together with the information concerning
the auditor as outlined in subsection (iv) below; (ii) Tenant shall not be
entitled to conduct an audit if Tenant is in default under this Lease beyond any
applicable cure period at the time Tenant gives its Tenant's Notice of Audit or
at the time the Tenant or its agent undertakes the audit; (iii) At the time the
Tenant delivers its Tenant's Notice of Audit to Landlord, the Tenant shall also
provide evidence reasonably acceptable to the Landlord that the audit will be a
"fair and true audit." For the purposes hereof, the term "fair and true audit"
shall mean that the review of the subject books and records shall be undertaken
and completed by the Tenant, its officers or employees, or by an independent
accounting firm being paid on an hourly basis and that in no event will the
party auditing the books (or that party's employer or principal) directly or
indirectly base the compensation or fees for such audit work upon a percentage
of the savings found or the return due the Tenant by reason of that audit; (iv)
Tenant's rights to audit the Landlord's books and records shall be strictly
limited to the right set forth above and the Tenant shall have no right to audit
any of the Landlord's books or records for any calendar year before or after the
Lease Term or for any calendar year other than the immediately preceding
calendar year as set forth above. All costs and expenses of the audit shall be
borne solely by the Tenant; and (v) unless Tenant takes written exception to
Landlord's statement within three (3) months after Landlord's statement is
received by Tenant, such Landlord's statement shall be considered as final and
accepted by Tenant. If Tenant's audit shows that Landlord overcharged
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Tenant for Additional Rent for the applicable calendar year by more than five
(5%) percent of Tenant's actual obligation therefor, Landlord shall pay the
reasonable costs of such audit concurrently with the payment of Tenant's refund
or application of Tenant's credit at a cost not to exceed $1,500 per year.
Subject to Tenant's audit right as described above, Landlord's determination of
Operating Costs and Additional Rent shall be final and binding on Landlord and
Tenant absent manifest error.
(d) Use of Common Areas. Tenant shall also have the right
to non-exclusive use of all common areas in the Building, including any
conference rooms, entrances, reception areas, elevator lobbies, restrooms, food
preparation areas, and other public areas (the "Common Areas") in common with
all other tenants (if any) in the Building.
6. UTILITIES.
(a) Utilities. Landlord shall provide, at Tenant's
expense, heat, air conditioning, ventilation, water, sewer service, refuse
collection, gas, electricity, telephone and for all other utilities used or
consumed by Tenant in the Premises; provided, however, that Landlord shall have
no obligation to provide such utilities in amounts in excess of those reasonably
deemed by Landlord to be standard for the Permitted Uses.
(b) Interruption of Services. Landlord shall not be
liable for any loss, injury or damage to person or property caused by or
resulting from any variation, interruption, or failure of such services due to
any cause whatsoever, and rent shall not xxxxx as a result thereof.
Notwithstanding the foregoing, if: (i) such utility service is interrupted
because of the negligent acts or omissions of Landlord, its employees, agents or
contractors; (ii) Tenant notifies Landlord of such interruption in writing (the
"Interruption Notice"); (iii) such interruption does not arise in whole or in
part as a result of an act or omission of Tenant; (iv) such interruption is not
caused by a fire or other casualty; (v) the repair or restoration of such
service is reasonably within the control of Landlord; (vi) Tenant is not then in
default, and (vii) as a result of such interruption, the Premises or a material
portion thereof, is rendered untenantable (meaning that Tenant is unable to use
the Premises in the normal course of it business) and Tenant in fact ceases to
use the Premises, or material portion thereof, then, Tenant's sole remedy for
such interruption shall be as follows: on the tenth (10th) consecutive business
day following the later to occur of the date the Premises (or material portion
thereof) becomes untenantable, the date Tenant ceases to use such space and the
date Tenant provides Landlord with an Interruption Notice, the Rent payable
hereunder shall be abated on a per diem basis for each day after such ten (10)
business day period based upon the percentage of the Premises so rendered
untenantable and not used by Tenant, and such abatement shall continue until the
date the Premises become tenantable again.
7. SECURITY DEPOSIT. Landlord acknowledges that it has received
the Security Deposit stated in Section 1(l) hereof, which Security Deposit is to
be held by Landlord during the term of this Lease pursuant to the following
provisions. The Security Deposit shall be held by Landlord without liability for
interest and as security for the performance by Tenant of Tenant's covenants and
obligations under this Lease, it being expressly understood that the Security
Deposit shall not be considered an advance payment of rental or a measure of
Tenant's damages in case of default by Tenant. Landlord may, in its sole
discretion, from time to time without prejudice to any other remedy, use the
Security Deposit to the extent necessary to make good any
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default under this Lease or to satisfy any other covenant or obligation of
Tenant hereunder; provided, however, that no portion of the Security Deposit
shall be applied towards payment of the last month's rent hereunder without the
prior written consent of the Landlord. Following any such application of the
Security Deposit, Tenant shall pay to Landlord on demand the amount so applied
in order to restore the Security Deposit to its original amount. If Tenant is
not in default at the termination of this Lease, the balance of the Security
Deposit remaining after any such application shall be returned by Landlord to
Tenant after deducting therefrom any unpaid obligation of Tenant to Landlord as
may arise under this Lease, including, without limitation, the surrender of
possession obligations set forth in Section 24. If Landlord transfers its
interest in the Premises during the term of this Lease, Landlord shall assign
the Security Deposit to the transferee and thereafter Landlord shall have no
further liability to Tenant for the return of such Security Deposit.
8. USES.
(a) Uses. The Premises are to be used only for general
office, assembly and distribution of the products used in Tenant's business and
related functions ("Permitted Uses") and for no other purpose. Tenant shall at
all times keep and use the Premises in compliance with all laws and regulations
and in compliance with this Lease. Tenant shall not commit any act that will
increase the then existing rate of insurance on the Premises or Land and will
immediately pay any such increase. Tenant shall promptly pay upon demand the
amount of any increase in insurance rates caused by any act or acts of Tenant.
Tenant shall not commit or allow to be committed any waste upon the Premises or
the Land, or any public or private nuisance or other act which is unlawful.
(b) Compliance With Law. Tenant shall, at Tenant's
expense, comply promptly with all applicable statutes, ordinances, rules,
regulations, orders and requirements, including without limitation laws and
regulations prohibiting discrimination on the basis of race, gender, religion,
national origin, age or disability, in effect during the term hereof regulating
the use, occupancy or improvement of the Premises by Tenant, Landlord or
otherwise and Tenant shall be fully responsible for the cost of complying
therewith.
(c) Compliance With Rules and Regulations. Tenant shall
observe and comply with all reasonable rules and regulations put into effect by
Landlord.
(d) Signage. Tenant will not inscribe any inscription or
post, place, or in any manner display any sign, notice, picture or poster or any
advertising matter whatsoever, anywhere in or about the Premises or Building
which can be seen from outside the Premises or Building, without first obtaining
Landlord's written consent thereto. Tenant shall install any approved signage at
Tenant's sole expense and in compliance with all applicable laws. Tenant shall
not damage or deface the Premises or Building in installing or removing signage
and shall repair any injury or damage to the Premises or Building caused by
installation or removal.
9. IMPROVEMENTS. Upon expiration or sooner termination of this
Lease, all improvements and additions to the Premises, except Tenant's trade
fixtures, shall be deemed the property of Landlord, unless Landlord requires
their removal in accordance with this Lease.
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10. ACCEPTANCE OF PREMISES. Tenant hereby accepts the Premises,
Building and the Land in their "as is" condition existing as of the date of the
execution hereof. Tenant acknowledges that except as specified elsewhere in this
Lease, neither Landlord nor Landlord's agent has made any representation or
warranty regarding the Premises, including the structural condition of the
Premises and the condition of all mechanical, electrical, and other systems on
the Premises, or the suitability of the Premises for the conduct of Tenant's
business, and Tenant hereby waives any rights, claims or actions against
Landlord under any such express or implied warranties.
11. CARE OF PREMISES.
(a) Repair and Maintenance by Tenant. Tenant shall, at
Tenant's sole cost and expense, keep and maintain the Premises and every part
thereof (whether structural or non-structural, except as set forth in Section
11(b) below) and such portion of the Building within the exclusive control of
Tenant in good and safe condition and repair, damage thereto from insured
casualty and ordinary wear and tear excepted, including utilities and all other
systems serving the Premises. Tenant shall keep the Premises in a clean and
sanitary condition. Tenant also shall be responsible for maintaining and
replacing all specialty lamps, bulbs, starters and ballasts within the Premises.
If Tenant fails to perform promptly Tenant's obligations under
this Section 11, Landlord may at Landlord's option enter upon the Premises after
ten (10) days' prior notice to Tenant and put the same in good order, condition
and repair and the cost thereof together with interest thereon at the rate of
15% per annum shall be due and payable as Additional Rent to Landlord together
with Tenant's next installment of Basic Rent. All normal repairs shall be those
reasonably determined by Landlord as necessary to maintain the Premises in their
current condition.
(b) Repair and Maintenance by Landlord.
Subject to Sections 14 and 16, Landlord shall keep in a good
state of repair the roof, exterior walls, foundations and building structure of
the Premises, the Common Areas and facilities of the Building, the systems and
equipment serving the Common Areas and Building, the parking areas, pedestrian
walkways and landscaped areas, and shall accomplish such repairs as may be
needed promptly after receipt of written notice from Tenant. Notwithstanding the
foregoing, if such repairs are required by reason of the negligent acts or
failure to act by Tenant or its employees, agents, contractors or invitees,
Tenant shall promptly pay Landlord for the cost thereof as Additional Rent.
There shall be no abatement of rent and no liability of Landlord by reason of
any injury to or interference with Tenant's business arising from the making of
any repairs, alterations or improvements in or to any portion of the Premises or
Building, or in or to fixtures, appurtenances and equipment therein. If Landlord
fails to make any repairs or to perform any maintenance required of Landlord
hereunder and within Landlord's reasonable control, and such failure shall
persist for an unreasonable time (not less than thirty (30) days) after written
notice of the need for such repairs or maintenance is given to Landlord and
unless Landlord has commenced such repairs or maintenance during such period and
is diligently pursuing the same, Tenant may (but shall not be required to)
following a second notice (which notice shall have a heading in at least
12-point type, bold and all caps "FAILURE TO
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RESPOND SHALL RESULT IN TENANT EXERCISING SELF-HELP RIGHTS") and Landlord's
failure to commence repairs within five (5) days after receipt of such second
notice, perform such repairs or maintenance in accordance with the provisions of
this Lease governing Tenant's repairs and Alterations and Landlord shall
reimburse Tenant for all necessary and reasonable costs and expenses therefor
within thirty (30) days after presentation of appropriate invoices and back-up
documentation.
12. ALTERATIONS AND ADDITIONS.
(a) Tenant shall not make any alterations, improvements,
additions, or utility installations in or about the Premises (collectively,
"Alterations") without first obtaining the written consent of Landlord in
accordance with plans and specifications approved by Landlord. Any alterations
required to be made to the Premises by any applicable building, health, safety,
fire, nondiscrimination, or similar law or regulation ("law") shall be made at
Tenant's sole expense and shall be subject to the prior written consent of
Landlord, which consent shall not be unreasonably withheld, conditioned or
delayed. Landlord's approval of any improvements or alterations may be withheld
in Landlord's reasonable discretion if such improvements or alterations require
any other alteration, addition, or improvement to be performed or made to any
portion of the Building other than the Premises. Notwithstanding the foregoing,
Tenant shall not be obligated to receive the written consent of Landlord for
interior Alterations to the Premises if said Alterations do not in any way
affect the Building's structure, the Common Areas or Building's Systems, do not
exceed the total amount of Twenty Five Thousand Dollars ($25,000) in the
aggregate in any calendar year, and Tenant is not required by applicable Law to
obtain a permit to perform the Alteration. Tenant shall reimburse Landlord for
any sums expended for examination and approval or architectural or mechanical
plans and specifications of the Alterations. Landlord may require a lien and
completion bond for such construction, or require the improvements be removed at
the expiration of the Term. Landlord's approval of the plans, specifications and
working drawings for Tenant's alterations shall create no responsibility or
liability on the part of Landlord for their completeness, design sufficiency, or
compliance with all laws, rules and regulations of governmental agencies or
authorities.
(b) Tenant shall pay, when due, all claims for labor or
materials furnished to or for Tenant at or for use in the Premises, which claims
are or may be secured by any mechanics' or materialmen's liens against the
Premises or any interest therein.
(c) Unless Landlord requires their removal, all
Alterations (other than trade fixtures and movable equipment) which may be made
on the Premises shall become the property of Landlord and remain upon and be
surrendered with the Premises at the expiration of the term.
(d) At the time of completion of each Alteration, Tenant
shall deliver to Landlord a set of "as built" plans and specifications of the
Alterations.
13. ACCESS. Tenant shall permit Landlord and its agents and
contractors to enter the Premises at all reasonable times after reasonable
notice from Landlord (except in cases of emergency, where no notice is required)
for the purpose of inspecting, cleaning, repairing, altering or improving the
Premises, the Building or the Land. Landlord may temporarily close any portion
of the Land, the Building or Premises without liability to Tenant by reason of
such
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closure, and such closure shall not constitute an eviction of Tenant or release
Tenant from any Rent hereunder. Tenant hereby waives any claim for rent
abatement, damages, injury or inconvenience to or interference with Tenant's
business, any loss of occupancy or quiet enjoyment of the Premises, and any
other loss occasioned by Landlord's exercise of its rights pursuant to this
Section 13, unless caused by the gross negligence or willful misconduct of
Landlord, its employees, agents or contractors. If a representative of Tenant is
not personally present and entry is necessary due to an emergency or urgent
necessity, Landlord shall have the right to use any and all means which Landlord
may deem proper to open the doors to or in the Premises in order to obtain entry
to the Premises without liability to Tenant. Landlord shall use reasonable
efforts to notify Tenant by phone or otherwise prior to such an entry, and if
such notice is not possible, then as soon after such entry as may be reasonably
possible. Any entry to the Premises obtained by Landlord by any of these means,
shall not under any circumstances be construed or deemed to be a forcible or
unlawful entry into, or a detainer of, the Premises, or an eviction of Tenant
from the Premises or any portion thereof. This Section shall not impose any
repair or other obligation upon Landlord not expressly stated elsewhere in this
Lease.
14. DAMAGE OR DESTRUCTION.
(a) Damage and Repair. If the Premises or the Building
are damaged by fire or other casualty (a "Casualty"), Landlord shall use good
faith efforts to deliver to Tenant within sixty (60) days after such Casualty a
good faith estimate (the "Damage Notice") of the time needed to repair the
damage caused by such Casualty. If a material portion of the Premises is damaged
by Casualty that did not result from the act or omission of Tenant such that
Tenant is prevented from conducting its business in the Premises in a manner
reasonably comparable to that conducted immediately before such Casualty and
Landlord estimates that the damage caused thereby cannot be repaired within one
hundred eighty (180) days after the commencement of repairs (the "Repair
Period"), then Tenant may terminate this Lease by delivering written notice to
Landlord of its election to terminate within thirty (30) days after the Damage
Notice has been delivered to Tenant. If a Casualty damages the Premises or a
material portion of the Building and: (1) Landlord estimates that the damage to
the Premises cannot be repaired within the Repair Period; (2) the damage to the
Premises exceeds thirty percent (30%) of the replacement cost thereof (excluding
foundations and footings), as estimated by Landlord; (3) or insurance proceeds
are not available or are not sufficient to pay the entire cost of restoration;
or (4) Landlord is required to pay any insurance proceeds arising out of the
Casualty to a Landlord's mortgagee, then Landlord may terminate this Lease by
giving written notice of its election to terminate within thirty (30) days after
the Damage Notice has been delivered to Tenant. If the Lease is not terminated,
Landlord shall restore the Premises (to the extent of the improvement of the
Premises originally provided by Landlord hereunder) with reasonable promptness,
subject to delays beyond Landlord's control and delays in the making of
insurance adjustments by Landlord. To the extent that the Premises are rendered
untenantable, the Rent shall proportionately xxxxx, except in the event such
damage resulted from the act or omission of Tenant, in which event Rent shall
xxxxx only to the extent Landlord receives proceeds from any rental income
insurance policy to compensate Landlord for loss of Rent hereunder.
(b) Business Interruption. No damages, compensation or
claim shall be payable by Landlord for inconvenience, loss of business or
annoyance arising from any repair or
10
restoration of any portion of the Premises or the Land. Landlord shall use its
best efforts to effect such repairs promptly.
(c) Tenant Improvements. Landlord will not carry
insurance of any kind on any improvements paid for by Tenant or on Tenant's
furniture, furnishings, fixtures, equipment or appurtenances of Tenant under
this Lease and Landlord shall not be obligated to repair any damage thereto or
replace the same.
15. CONDEMNATION.
(a) Entire Taking. If all of the Premises or such
portions of the Land as may be required for the reasonable use of the Premises
are taken by eminent domain, this Lease shall automatically terminate as of the
date title vests in the condemning authority. In the event of a taking of a
material part, but less than all, of the Land, where Landlord shall determine
that the remaining portions of the Land cannot be economically and effectively
used by it (whether on account of physical, economic, aesthetic or other
reasons) or where Landlord determines the Land should be restored in such a way
as to materially alter the Premises, Landlord shall forward a written notice-to
Tenant of such determination not more than sixty (60) days after the date of
taking. The term of this Lease shall expire upon such date as Landlord shall
specify in such notice but not earlier than sixty (60) days after the date of
such notice. In case of taking of a part of the Premises, or a portion of the
Land not required for the reasonable use of the Premises, then this Lease shall
continue in full force and effect and the Rent shall be equitably reduced based
on the proportion by which the floor area of the Premises is reduced.
(b) Awards and Damages. Landlord reserves all rights to
damages to the Premises for any partial, constructive, or entire taking by
eminent domain, and Tenant hereby assigns to Landlord any right Tenant may have
to such damages or award, and Tenant shall make no claim against Landlord or the
condemning authority for damages for termination of the leasehold interest or
interference with Tenant's business. Tenant shall have the right, however, to
claim and recover from the condemning authority compensation for any loss to
which Tenant may be put for Tenant's moving expenses, business interruption or
taking of Tenant's personal property (not including Tenant's leasehold interest)
provided that such damages may be claimed only if they are awarded separately in
the eminent domain proceedings and not out of or as part of the damages
recoverable by Landlord.
16. INDEMNIFICATION.
(a) Indemnity. Tenant shall indemnify, defend and hold
Landlord harmless from and against all loss, cost and expense, including
attorneys fees, arising from any act, omission, or negligence of Tenant or its
officers, contractors, licensees, agents, servants, employees, guests, invitees,
or visitors in or about the Premises or Land, or arising from any injury or
damage to any person or property, occurring in or about the Premises or Land as
a result of any act, omission or negligence of Tenant, or its officers,
contractors, licensees, agents, employees, guests, or visitors or arising from
any breach or default under this Lease by Tenant. The foregoing provisions shall
not be construed to make Tenant responsible for loss, damage, liability or
expense resulting from injuries to third parties caused solely by the gross
negligence of Landlord, or its officers, contractors, licensees, agents,
employees, or invitees.
11
(b) Exemption of Landlord From Liability. As a material
part of the consideration to Landlord, Tenant hereby agrees that,
notwithstanding anything to the contrary in Section 16(a) above, Landlord shall
in no event be liable for injury to Tenant's business or assets or any loss of
income therefrom or for damage to Tenant's employees, invitees, customers, or
any other person in or about the Premises, whether such damage, loss or injury
results from conditions arising upon the Premises or upon other portions of the
Land, or from other sources or places, and regardless of whether the cause of
such damage, loss or injury or the means of repairing the same is inaccessible
to Tenant, unless caused by the gross negligence or willful misconduct of
Landlord, its employees, agents or contractors. Tenant further agrees that
notwithstanding anything to the contrary in Section 16(a) above, Landlord shall
in no event be liable for any injury or damage to any person or property of
Tenant, Tenant's employees, invitees, customers, agents or contractors arising
from any act or neglect of any third person, unless caused by the gross
negligence or willful misconduct of Landlord's agents or contractors acting at
Landlord's direction.
(c) Waiver of Subrogation. Landlord and Tenant each
hereby waive their rights of subrogation against one another to the extent it is
covered by the property insurance policies required to be carried hereunder or
actually carried by such party. Landlord and Tenant agree to use reasonable
efforts to cause their insurance carriers to consent to the foregoing waiver of
rights of subrogation against the other party.
17. HAZARDOUS SUBSTANCES: Tenant shall not dispose of or otherwise
allow the release of any hazardous waste or materials in, on or under the
Premises, or any adjacent property. Tenant represents and warrants to Landlord
that Tenant's intended use of the Premises does not involve the use, production,
disposal or bringing on to the Premises of any hazardous waste or materials. As
used herein, the term "hazardous waste or materials" includes any substance,
waste or material defined or designated as hazardous, toxic or dangerous (or any
similar term) by any federal, state or local statute, regulation, rule or
ordinance now or hereafter in effect. Tenant shall promptly comply with all
applicable laws and with all orders, decrees or judgments of governmental
authorities or courts having jurisdiction relating to hazardous waste or
materials.
Tenant agrees to indemnify, defend and hold harmless Landlord against
any and all loss, cost and expense (including, without limitation, consultant
fees, attorneys' fees and disbursements) which may be imposed on, incurred or
paid by, or asserted against Landlord or the Premises by reason of, or in
connection with (i) any misrepresentation, breach of warranty or other default
by Tenant under this Lease, or (ii) the acts or omissions by Tenant under this
Lease, or (ii) the acts or omissions, of Tenant, or any sublessee or other
person for whom Tenant would otherwise be liable, resulting in the release of
any hazardous waste or materials.
18. INSURANCE.
(a) Required Policies. Tenant shall, throughout the term
of this Lease, at its own expense, keep and maintain in full force and effect a
policy of commercial liability insurance including a contractual liability
endorsement covering Tenant's obligations under Section 16 and 17, with a limit
of not less than One Million Dollars ($1,000,000) combined single limit with a
deductible of not more than $5,000. This policy shall name Landlord as an
12
additional insured, and the insurance will be noncontributory with any liability
insurance carried by Landlord. Tenant shall also, throughout the term of this
Lease, at its own expense, keep and maintain in full force and effect, what is
commonly referred to as "all risk" coverage casualty insurance (but excluding
earthquake and flood) on Tenant's leasehold improvements in an amount not less
than the current One Hundred Percent (100%) replacement value thereof with a
deductible of not more than $5,000. The casualty insurance policy shall name
Tenant as the insured and Landlord and Landlord's lender(s) as additional
insureds, with loss payable to Landlord, Landlord's lender(s), and Tenant as
their interests may appear.
(b) Insurance Policy Requirements. Insurance policies
required hereunder shall be issued by companies which are currently rated AXII
or better in "Best's Insurance Guide." No insurance policy shall be canceled or
reduced in coverage and each such policy shall provide that it is not subject to
cancellation or a reduction in coverage except after thirty (30) days' prior
written notice to Landlord. Tenant shall deliver to Landlord certificates
evidencing the existence and amounts of insurance required under Section 18(a),
all of which shall include loss payable clauses satisfactory to Landlord. In no
event shall the limit of such policies be considered as limiting the liability
of Tenant under this Lease.
(c) Landlord's Insurance. Throughout the Term of this
Lease, Landlord shall maintain, as a minimum, the following insurance policies:
(1) property insurance for the Building's replacement value (excluding property
required to be insured by Tenant), less a commercially-reasonable deductible if
Landlord so chooses; and (2) commercial general liability insurance in an amount
and with coverages Landlord deems reasonably appropriate. Landlord may, but is
not obligated to, maintain such other insurance and additional coverages as it
may deem necessary.
19. ASSIGNMENT AND SUBLETTING. Tenant may assign, this Lease or
sublet the whole or any part of the Premises without in each case first
obtaining Landlord's prior written consent; provided, however, that Tenant shall
notify Landlord in writing of the name and address of the assignee or subtenant
and the nature and character of the business of the assignee or subtenant and
shall provide current and prior financial statements for the assignee or
subtenant, which financial statements shall be audited to the extent available
and shall in any event be prepared in accordance with generally accepted
accounting principles. Tenant shall also provide Landlord with a copy of the
sublease or assignment agreement, including all material terms and conditions
thereof. No assignment, subletting or other transfer shall relieve Tenant of any
liability under this Lease. Consent to any such assignment, subletting or
transfer shall not operate as a waiver of the necessity for consent to any
subsequent assignment, subletting or transfer. In connection with each request
for an assignment or subletting, Tenant shall pay the reasonable cost of
processing such assignment or subletting, including attorneys fees, upon demand
of Landlord. If Tenant is a corporation, limited liability company or
partnership, any transfer of a controlling ownership interest in Tenant or any
transfer of this Lease by merger, consolidation or liquidation, shall be deemed
an assignment under this Section 19. Any assignee or subtenant shall assume all
of Tenant's obligations under this Lease and be jointly and severally liable
with Tenant hereunder.
20. LIENS AND INSOLVENCY. Tenant shall keep its interest in this
Lease and any Property of Tenant (other than unattached personal property) and
the Premises and the Land free
13
from any liens arising out of any work performed or materials ordered or
obligations incurred by or on behalf of Tenant and hereby indemnifies and holds
Landlord harmless from any liability, costs and expenses (including attorneys'
fees) from any such lien.
Notwithstanding the provisions of this Section, Tenant shall have the
right to grant security interests in and to its personal property located at the
Premises to third party lenders. Landlord agrees from time to time to execute
such documents and instruments in form reasonably satisfactory to Landlord
having the effect of subordinating Landlord's statutory landlord's lien rights
in and to all equipment and personal property of Tenant to the security interest
of Tenant's lender(s).
21. DEFAULT.
(a) Default By Tenant. The occurrence of any one or more
of the following events shall constitute a material default and breach of this
Lease by Tenant: (i) the abandonment of the Premises by Tenant or the vacating
of the Premises for more than thirty (30) consecutive days; (ii) the failure by
Tenant to make any payment of Rent or any other payment required to be made by
Tenant hereunder, where that failure shall continue for a period of three (3)
business days after Landlord gives written notice to Tenant of that failure;
(iii) the failure by Tenant to observe or perform any of the other covenants,
conditions or provisions of the Lease, where such failure shall continue for a
period of twenty (20) days; provided, however, if more than twenty (20) days are
reasonably required for its cure then Tenant shall not be deemed to be in
default if Tenant commences such cure within said 20-day period and thereafter
diligently prosecutes such cure to completion; (iv) the making by Tenant of any
general assignment or general arrangement for the benefit of creditors; (v) the
filing by or against Tenant of a petition to have Tenant adjudged bankrupt or a
petition for reorganization or arrangement under any law relating to bankruptcy
(unless, in the case of a petition filed against Tenant, the same is dismissed
within sixty (60) days); (vi) the appointment of a trustee or receiver to take
possession of substantially all of Tenant's assets located at the Premises or of
Tenant's interest in the Lease, where possession is not restored to Tenant
within thirty (30) days; or (vii) the attachment, execution or other judicial
seizure of substantially all of Tenant's assets located at the Premises or of
Tenant's interest in this Lease, where such seizure is not discharged within
thirty (30) days.
(b) Landlord's Remedies Upon Tenant Default. All rights
and remedies of Landlord herein enumerated shall be cumulative, and none shall
exclude any other right or remedy allowed by law or in equity. Upon a default,
Landlord may reenter the Premises and remove or put out Tenant or any other
persons found therein No such reentry shall be construed as an election on
Landlord's part to terminate this Lease unless a written notice of such
intention is given to Tenant. Landlord may elect to re-let the Premises upon
such terms and conditions, including rent, term and remodeling or renovation, as
Landlord in its sole discretion may deem advisable. Any shortfall in amounts
received from Landlord from such re-letting shall be paid on a monthly basis by
Tenant. The failure or refusal of Landlord to re-let the Premises shall not
release or affect Tenant's liability hereunder. Landlord may also elect to
terminate the Lease and collect from Tenant, in addition to all amounts accrued
under this Lease to date, all rent owing for the remainder of the Term of the
Lease, less the amount that Tenant proves could be collected for the remainder
of the Term.
14
(c) Landlord's Default. Landlord shall not be in default
unless Landlord fails to perform its obligations trader this Lease within thirty
(30) days after written notice by Tenant, or if such failure is not reasonably
capable of being cured within such thirty (30) day period, Landlord shall not be
in default unless Landlord has failed to commence the cure and diligently pursue
the cure to completion.
22. PRIORITY. This Lease shall be automatically subordinate to any
mortgage or deed of trust now existing or hereafter placed upon the Land or the
Premises, created by or at the instance of Landlord, and to any and all advances
to be made thereunder and to interest thereon and all modifications, renewals
and replacements or extensions thereof ("Landlord's Mortgage"). Notwithstanding
the foregoing, Tenant's obligations under this Section are conditioned on the
holder of each Landlord's Mortgage and each person acquiring the Premises at any
sale or other proceeding not disturbing Tenant's occupancy and other rights
under this Lease, so long as no uncured event of default exists. Landlord shall
make reasonable efforts to obtain from the holder of each Landlord's Mortgage a
non-disturbance agreement in a form reasonable acceptable to such holder and
Tenant. Tenant shall properly execute, acknowledge and deliver documents which
the holder of any Landlord's Mortgage may require to effectuate the provisions
of this Section 22 provided that such document(s) do not alter any material
provisions of this Lease and include no disturbance provisions reasonably
acceptable to Tenant.
23. ESTOPPEL CERTIFICATES.
(a) Delivery of Estoppel. Tenant shall, from time to
time, upon written request of Landlord, execute, acknowledge and deliver to
Landlord or its designee a written statement certifying that: (i) this Lease is
in full force and effect and has not been assigned or amended in any way (or
specifying the date and terms of agreement so affecting this Lease); (ii) this
Lease represents the entire agreement between the parties as to this leasing;
that all obligations under this Lease to be performed by the Landlord have been
satisfied; (iii) on this date there are no existing claims, defenses or offsets
which the Tenant has against the enforcement of this Lease by the Landlord; (iv)
no Rent has been paid more than one month in advance; and that no security has
been deposited with Landlord (or, if so, the amount thereof); and (v) such other
items as Landlord shall reasonably request. It is intended that any such
statement delivered pursuant to this Section may be relied upon by a prospective
purchaser of Landlord's interest or holder of any Landlord's Mortgage.
(b) Failure to Deliver Estoppel. If Tenant shall fail to
respond within ten (10) days of receipt by Tenant of a written request by
Landlord as herein provided, Tenant shall be deemed to have given such
certificate as above provided without modification and shall be deemed to have
admitted the accuracy of any information supplied by Landlord to a prospective
purchaser or mortgagee and to have certified that this Lease is in full force
and effect, that there are no uncured defaults in Landlord's performance, that
the security deposit is as stated in the Lease, and that not more than one
month's Rent has been paid in advance.
24. SURRENDER OF POSSESSION. Subject to the terms of Section 14
relating to damage and destruction, upon expiration of the term of this Lease,
whether by lapse of time or otherwise, Tenant shall promptly and peacefully
surrender the Premises to Landlord, together will all keys, "broom-clean" and in
as good condition as when received by Tenant from Landlord
15
or as thereafter improved, reasonable use, wear and tear excepted. Tenant shall
remove any improvements and Alterations to the Premises required by Landlord to
be removed in accordance with this Lease and all of its personal property and
trade fixtures from the Premises at the expiration of the term. Tenant shall
repair or reimburse Landlord for the cost of repairing any damage to the
Premises and/or Common Areas resulting from the installation or removal of
Tenant's property.
If Tenant shall fail to remove any of its property of any nature
whatsoever from the Premises or the Building at the termination of this Lease or
when Landlord has the right of re-entry, Landlord may remove and store such
property without liability for loss thereof or damage thereto, such storage to
be for the account and at the expense of Tenant. If Tenant shall not pay the
cost of storing any such property after it has been stored for a period of
thirty (30) days or more, Landlord may, at its option, sell, or permit to be
sold, any or all such property at public or private sale, in such manner and at
such times and places as Landlord in its sole discretion may deem proper,
without notice to Tenant, unless notice is required under applicable statutes,
and shall apply the proceeds of such sale: first, to the cost and expense of
such sale, including reasonable attorneys' fees actually incurred; second, to
the payment of the costs or charges for storing any such property; third, to the
payment of any other sums of money which may then be or thereafter become due to
Landlord from Tenant under any of the terms hereof; and, fourth, the balance, if
any, to Tenant. Subject to Tenant's right to grant security interests in its
personal property to third party lenders as set forth in Section 20 above,
nothing in this Section shall limit Landlord's right to sell Tenant's personal
property as permitted by law to foreclose Landlord's lien for unpaid rent.
25. NON-WAIVER. Waiver by Landlord of any term, covenant or
condition herein contained or any breach thereof shall not be deemed to be a
waiver of such term, covenant, or condition or of any subsequent breach of the
same or any other term, covenant, or condition herein contained.
26. HOLDOVER. If Tenant remains in possession of the Premises or
any part thereof after the expiration of the term of this Lease with the express
written consent of Landlord, such occupancy shall be a tenancy from
month-to-month at a rental in the amount equal to one and a half times the last
monthly rental plus all other charges payable under this Lease, and subject to
all of the terms, covenants and conditions of this Lease applicable to a
month-to-month tenancy. Tenant acknowledges and agrees that this Section 26 does
not grant any right to Tenant to holdover.
27. LANDLORD'S LIABILITY. Anything in this Lease to the contrary
notwithstanding, covenants, undertakings and agreements herein made on the part
of Landlord are made and intended not as personal covenants, undertakings and
agreements for the purpose of binding Landlord personally or the assets of
Landlord except Landlord's interest in the Premises, but are made and intended
for the purpose of binding only the Landlord's interest in the Premises, as the
same may from time to time be encumbered.
28. TRANSFER OF LANDLORD'S INTEREST. In the event of any transfer
of Landlord's interest in the Premises or in the Land, provided the transferor
has transferred to the transferee the Security Deposit and except for any
defaults hereunder for which Tenant has
16
provided notice to transferor prior to the date of any such transfer, the
transferor shall be automatically relieved of any and all obligations and
liabilities on the part of Landlord accruing from and after the date of such
transfer and such transferee shall have no obligation or liability with respect
to any matter occurring or arising prior to the date of such transfer. Tenant
agrees to attorney to the transferee.
29. RIGHT TO PERFORM. If Tenant shall fail to pay any sum of money
required to be paid by it hereunder or shall fail to perform any other act on
its part to be performed hereunder, and such failure shall continue after any
notice and cure period set forth above, Landlord may, but shall not be obligated
so to do, and without waiving or releasing Tenant from any obligations of
Tenant, make such payment or perform any such other act on Tenant's part to be
made or performed as provided in this Lease.
30. GENERAL.
(a) Headings. Titles to Sections of this Lease are not a
part of this Lease and shall have no effect upon the construction or
interpretation of any part hereof.
(b) Heirs and Assigns. All of the covenants, agreements,
terms and conditions contained in this Lease shall inure to and be binding upon
the Landlord and Tenant and their respective heirs, executors, administrators,
successors and assigns.
(c) Authority. Each individual executing this Lease on
behalf of Tenant represents and warrants that he or she is duly authorized to
execute and deliver this Lease on behalf of Tenant, and that this Lease is
binding upon Tenant in accordance with its terms.
(d) No Brokers. Tenant represents and warrants to
Landlord that it has not engaged any broker, finder or other person who would be
entitled to any commission or fees in respect of the negotiation, execution or
delivery of this Lease and shall indemnify and hold harmless Landlord against
any loss, cost, liability or expense incurred by Landlord as a result of any
claim asserted by any such broker, finder or other person on the basis of any
arrangements or agreements made or alleged to have been made by or on behalf of
Tenant.
(e) Entire Agreement. This Lease is the final and
complete expression of Landlord and Tenant relating in any manner to the
leasing, use and occupancy of the Premises and other matters set forth in this
Lease. No prior agreements or understanding pertaining to the same shall be
valid or of any force or effect and the covenants and agreements of this Lease
shall not be altered, modified or added to except in writing signed by both
Landlord and Tenant.
(f) Severability. Any provision of this Lease which shall
prove to be invalid, void or illegal shall in no way affect, impair or
invalidate any other provision hereof and the remaining provisions hereof shall
nevertheless remain in full force and effect.
(g) Force Majeure. Except for the payment of Rent,
Additional Rent or other sums payable by Tenant to Landlord, time periods for
Tenant's or Landlord's performance under any provisions of this Lease shall be
extended for periods of time during which Tenant's or Landlord's performance is
prevented due to circumstances beyond Tenant's or Landlord's control, including
without limitation, strikes, embargoes, shortages of labor or materials in the
normal
17
channels of trade, governmental regulations, acts of God, war or other strife,
financial inability of the party nonperforming party excepted.
(h) Notices. All notices under this Lease shall be in
writing and delivered in person or sent by registered or certified mail, postage
prepaid, to Landlord and to Tenant at the Addresses provided respectively in
Section l(e) and l(c) (provided that after the Commencement Date any such notice
shall be mailed or delivered by hand to Tenant at the Premises) and to the
holder of any mortgage or deed of trust at such place as such holder shall
specify to Tenant in writing; or such other addresses as may from time to time
be designated by any such party in writing. Notices mailed as aforesaid shall be
deemed given on the date of such mailing.
(i) Costs and Attorneys Fees. If either party requires
the services of an attorney in connection with enforcing the terms of this Lease
or if either party shall bring any action for any relief against the other,
declaratory or otherwise, arising out of this Lease, including any suit by
Landlord for the recovery of Rent, Additional Rent or other payments hereunder
or possession of the Premises each party shall, and hereby does, to the extent
permitted by law, waive trial by jury and the losing party shall pay the
prevailing party a reasonable sum for attorneys fees in such suit, at trial and
on appeal, and such attorneys fees shall be deemed to have accrued on the
commencement of such action.
(j) Governing Law. This Lease shall be governed by and
construed in accordance with the internal laws of the state of Washington.
(k) Recording. Tenant shall not record this Lease or a
memorandum hereof without Landlord's prior written consent and such recordation
shall, at the option of Landlord, constitute a non-curable default of Tenant
hereunder; provided, however, that upon Tenant's request Landlord and Tenant
shall execute and cause to be recorded in the King County, Washington recorder's
office at Tenant's sole expense (including without limitation, Landlord's
attorneys' fees) a memorandum of this lease in substantially the form of the
attached Exhibit B.
(l) Waivers. No waiver by Landlord of any provision
hereof shall be deemed a waiver of any other provision hereof or of any
subsequent breach by Tenant of the same or any other provision. Landlord's
consent to or approval of any act shall not be deemed to render unnecessary the
obtaining of Landlord's consent to or approval of any subsequent act by Tenant.
The acceptance of rent hereunder by Landlord shall not be a waiver of any
preceding breach at the time of acceptance of such rent.
(m) Time of Essence. Time is of the essence for the
performance of all of the obligations specified hereunder.
(n) Merger. The voluntary or other surrender of this
Lease by Tenant, or a mutual cancellation thereof, shall not work a merger and
shall, at the option of Landlord, terminate all or any existing subtenancies or
may, at the option of Landlord, operate as an assignment to Landlord of any or
all of such subtenancies.
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IN WITNESS WHEREOF this Lease has been executed the day and year first
above set forth.
LANDLORD: XXXX/RISE L.L.C., a Washington limited
liability company
By: /s/ Xxxxx X. Rise
-----------------------------------
Its Member
ETMA CORPORATION, a Washington
corporation
TENANT:
By: /s/ Xxxxxxx X. Xxxxxxxx
-----------------------------------
Its Treasurer
19
STATE OF WASHINGTON )
) ss.
COUNTY OF KING )
I certify that I know or have satisfactory evidence that Xxxxx X. Rise
is the person who appeared before me, and said person acknowledged that said
person signed this instrument, on oath stated that said person was authorized to
execute the instrument and acknowledged it as the authorized representative of
XXXX/RISE L.L.C., a Washington limited liability company, to be the free and
voluntary act of such entity for the uses and purposes mentioned in the
instrument.
DATED this 13th day of December, 2002.
/s/ Xxxxx X. Xxxxxxxx
-----------------------------------------------
(Signature of Notary)
Xxxxx X. Xxxxxxxx
-----------------------------------------------
(Legibly Print or Stamp Name of Notary)
Notary Public in and for the Xxxxx xx Xxxxxxxxxx,
xxxxxxxx xx Xxxx, XX
My appointment expires: 00-00-00
XXXXX XX XXXXXXXXXX )
) ss.
COUNTY OF KING )
I certify that I know or have satisfactory evidence that Xxxxxxx X.
Xxxxxxxx is the person who appeared before me, and said person acknowledged that
said person signed this instrument, on oath stated that said person was
authorized to execute the instrument and acknowledged it as the Treasurer of
ETMA CORPORATION, a Washington corporation, to be the free and voluntary act of
such corporation for the uses and purposes mentioned in the instrument.
DATED this 13th day of December, 2002.
/s/ Xxxxx X. Xxxxxxxx
----------------------------------------------------
(Signature of Notary)
Xxxxx X. Xxxxxxxx
----------------------------------------------------
(Legibly Print or Stamp Name of Notary)
Notary Public in and for the Xxxxx xx Xxxxxxxxxx,
xxxxxxxx xx Xxxx, XX
My appointment expires: 11-30-03
20
EXHIBIT A
LEGAL DESCRIPTION OF LAND
Property situated in King County, Washington, legally described as follows:
That portion of Lots 9 and 10 of Redmond East Business Campus,
according to the plat thereof recorded in Volume 135 of Plats, pages 16
and 17, in King County, Washington, and that portion of Lot 'C' of City
of Xxxxxxx Lot Line Adjustment No. 88-8, recorded under Recording
Number 8812210190 (being a portion of Lots 6 and 7 of said plat of
Redmond East Business Campus) in King County, Washington, said portion
being more particularly described as follows:
Beginning at the northeast xxxxx of said Lot 10;
thence along the north line thereof north 89 degrees 25'54" west 269.41
feet to the TRUE POINT OF BEGINNING;
thence south 00 degrees 34'06" west 66.00 feet;
thence north 89 degrees 25'54" west 333.00 feet to the west line of
said Lot 10; thence along the west line of Lots 10 and 9 north 00
degrees 34'06" east 256.00 feet to a line parallel with and 10.00 feet
southerly of the north line of said Lot 9;
thence along said parallel line and its easterly prolongation south 89
degrees 25'54" east 333.00 feet; thence south 00 degrees 34'06" west
190.00 feet to the TRUE POINT OF BEGINNING;
(ALSO KNOWN AS Lot 5, City of Xxxxxxx Lot Line Adjustment Number LLR
89-7, as recorded under Recording Number 9207069007, being a
re-recording of Recording Number 9002221025).
A-1
EXHIBIT B
FORM OF MEMORANDUM OF LEASE
WHEN RECORDED RETURN TO:
Xxxxxxx Xxxxxxxxx, Esq.
Xxxxxxx Coie LLP
Xxx Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxx, Xxxxxxxxxx 00000
MEMORANDUM OF LEASE
THIS MEMORANDUM OF LEASE shall evidence that there is in existence a
Lease as hereinafter described. It is executed by the parties hereto for
recording purposes only as to the Lease hereinafter described, and it is not
intended and shall not modify, amend, supersede or otherwise effect the terms
and provisions of said Lease.
1. Name of Document: LEASE AGREEMENT
2. Name of Lessor: XXXX/RISE L.L.C., a Washington
limited liability company
3. Name of Lessee: ETMA CORPORATION, a Washington
corporation
4. Address of Lessor: 00000 XX 00xx Xxxxxx
Xxxxxxx, Xxxxxxxxxx
5. Address of Lessee: 0000 X. Xxxxxx Xxxxx
Xxxxx, Xxxxxxx 00000
6. Date of Lease: December 13, 2002
7. Initial Lease Term: Five years, commencing on the
January 1, 2003 and ending
December 31, 2008
8. Option to Extend: Lessee has the option to extend
the Initial Lease Term for two
(2) additional periods
of three (3) years each.
9. Demised Premises: The real property more
particularly described in
Exhibit "A" attached hereto,
together with the improvements
thereon.
B-1
IN WITNESS WHEREOF, the Parties have executed this Memorandum of Lease
as of the day and year first written above.
LANDLORD: XXXX/RISE L.L.C., a Washington limited
liability company
By: _________________________________________
Its _____________________________________
TENANT: ETMA CORPORATION, a Washington corporation
By: _________________________________________
Its _____________________________________
B-2
STATE OF WASHINGTON )
) ss.
COUNTY OF KING )
I certify that I know or have satisfactory evidence that Xxxxx X. Rise
is the person who appeared before me, and said person acknowledged that said
person signed this instrument, on oath stated that said person was authorized to
execute the instrument and acknowledged it as the authorized representative of
XXXX/RISE L.L.C., a Washington limited liability company, to be the free and
voluntary act of such entity for the uses and purposes mentioned in the
instrument.
DATED this ____ day of ____________, 2002.
____________________________________________________
(Signature of Notary)
____________________________________________________
(Legibly Print or Stamp Name of Notary)
Notary Public in and for the State of Washington,
residing at ________________________________________
My appointment expires: ____________________________
STATE OF WASHINGTON )
) ss.
COUNTY OF KING )
I certify that I know or have satisfactory evidence that Xxxxxxx X.
Xxxxxxxx is the person who appeared before me, and said person acknowledged that
said person signed this instrument, on oath stated that said person was
authorized to execute the instrument and acknowledged it as the Treasurer of
ETMA CORPORATION, a Washington corporation, to be the free and voluntary act of
such corporation for the uses and purposes mentioned in the instrument.
DATED this ____ day of ____________, 2002.
____________________________________________________
(Signature of Notary)
____________________________________________________
(Legibly Print or Stamp Name of Notary)
Notary Public in and for the State of Washington,
residing at ________________________________________
My appointment expires: ____________________________
B-3
