Exhibit 10.10
SUBLEASE AGREEMENT
This Sublease Agreement (this "Sublease"), dated as of October 6, 2005, is
entered into by and between: Light Sciences Corporation, a Washington
corporation ("LSC"), and Light Sciences Oncology, Inc., a Washington corporation
("LSO").
RECITALS
A. LSC is the subtenant under that certain Sublease Agreement dated
September 9, 2002, between Microsoft, Inc., a Washington corporation (formerly
Great Plains Software O.C., Inc.) ("Sublandlord") and LSC (the "Master
Sublease"), under which LSC leases office space located at 00000 X.X. Xxxxxxx
Xxxxxx, Xxxxx 000, Xxxxxxxxxx, XX 00000 (the "Premises"). The Master Sublease is
attached to this Sublease as Schedule A. The Premises are more fully identified
and legally described in the Master Sublease.
B. Sublandlord is the tenant under that certain Lease dated as of March 2,
2000, between Snoqualmie Ridge Cascade View LLC, a Washington limited liability
company ("Master Landlord") and Sublandlord ("Master Lease"), under which
Sublandlord leases the Premises. The Master Lease is attached to this Sublease
as Schedule B.
C. LSC desires to sublease office space measuring approximately 6003 square
feet, shown cross-hatched on attached Schedule C (the "Subleased Premises") to
LSO and to share the right to use all other rooms and areas not occupied as
offices by staff of LSC or others (collectively, the "Shared Areas"), and LSO
desires to sublease such Subleased Premises from LSC and share the right to use
the Shared Areas, all subject to the terms and conditions of this Sublease.
AGREEMENT
NOW, THEREFORE, LSC and LSO agree as follows:
SECTION 1. SUBLEASED PREMISES AND SHARED AREAS. Subject to the terms and
conditions of this Sublease, LSC hereby subleases the Subleased Premises to LSO,
and LSO hereby subleases the Subleased Premises from LSC. In addition, LSC
grants LSO the right to use and access the Shared Areas and any and all
furniture, fixtures and equipment in the Shared Areas and the same rights of
ingress and egress to the Subleased Premises and Shared Areas as LSC has under
the Master Sublease. The shared equipment, includes, without limitation, the
equipment listed in attached Schedule D ("Designated Shared Equipment"). Without
limiting the foregoing, LSO will have the right to use for regular ingress and
egress the stairwell that is currently used as an emergency exit from the
Subleased Premises. LSC will deliver LSO possession of the Subleased Premises on
the date of this Sublease. LSO will have access to the Subleased Premises and
Shared Areas seven (7) days a week, twenty-four (24) hours a day, every day of
the year, subject to any restrictions set forth in the Master Lease or Master
Sublease. LSO will be entitled to display reasonable signage for the Subleased
Premises, including, without limitation, signage on the door to the Subleased
Premises, to the extent permitted under the Master Lease and Master Sublease.
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SECTION 2. SERVICES. During the Term (as defined below), LSC will provide the
following services to LSO for the normal use of the Subleased Premises and
Shared Areas:
(a) electricity, gas and utilities;
(b) heat, ventilation and air conditioning;
(c) telephone and data;
(d) janitorial services;
(e) maintenance and repair services necessary to maintain the
Subleased Premises and Shared Areas in good working order and in a safe
condition;
(f) maintenance and repair of all equipment, fixtures and furniture
used in the Shared Areas; and
(g) a reasonable number of unreserved parking spaces.
LSC will perform or cause to be performed the foregoing services in a
professional and workmanlike manner and with at least the same quality,
timeliness and efficiency as LSC performs or causes to be performed similar
services in the operation of its own business.
SECTION 3. TERM AND TERMINATION
3.1 TERM. The term of this Sublease will commence on the date of this
Sublease and will end upon the termination or expiration of the Master Sublease,
unless sooner terminated in accordance with Section 3.2, 3.3 or 3.4 (the
"Term").
3.2 TERMINATION BY LSO. LSO may terminate the Term upon one hundred twenty
(120) days' written notice; provided, that LSO may terminate the Term upon
written notice if LSC breaches any of its obligations under this Sublease, and
such breach continues for twenty (20) days after written notice from LSO.
3.3 TERMINATION BY LSC. LSC may terminate the Term upon written notice if
LSO fails to pay any Rent or other amounts payable hereunder when due, and such
failure continues for ten (10) days after written notice from LSC, or LSO
otherwise breaches its obligations under this Sublease, and such breach
continues for twenty (20) days after written notice from LSC.
3.4 TERMINATION OF MASTER LEASE OR MASTER SUBLEASE. This Sublease will
terminate if the Master Lease or Master Sublease terminates or is terminated for
any reason.
3.5 SURRENDER OF SUBLEASED PREMISES. LSO will, on or before the last day of
the Term, remove all of its furniture, furnishings, personal property and
equipment and surrender the Subleased Premises.
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SECTION 4. COMPENSATION
4.1 RENT. LSO will pay to LSC rent on a monthly basis ("Rent") calculated
as follows:
(a) for the Subleased Premises, LSO will pay an amount equal to
(i) the rent payable by LSC under Section 3.1 and 3.2 of the
Master Sublease multiplied by
(ii) the ratio of the rentable square footage of the Subleased
Premises to the rentable square footage of the Premises; and
(b) for the Shared Areas, LSO will pay an amount equal to
(i) the rent payable by LSC under Section 3.1 and 3.2 of the
Master Sublease multiplied by the ratio of the rentable square footage of the
Shared Areas to the rentable square footage of the Premises multiplied by
(ii) the ratio of the rentable square footage of the (x)
Subleased Premises to the (y) rentable square footage of the Subleased Premises
and the portion of the Premises used exclusively by any person or entity other
than LSO.
Rent will be paid in advance on the first day of each calendar month at such
place as LSC may designate, without prior demand therefor. Those portions of
Rent paid under this Section 4.1 attributable to "Additional Rent" payable by
LSC under the Master Sublease will be reconciled in accordance with Section 3.2
of the Master Sublease. If this Sublease does not commence or terminate on the
first or last day of a calendar month, Rent for the month of commencement or
termination will be prorated.
4.2 ADDITIONAL RENT. In the event LSC incurs costs to provide services
described in Section 2 that are not provided by the Master Landlord or
Sublandlord, then LSO will pay to LSC the actual costs incurred by LSC to
provide such services to LSO allocated to LSO in the same manner that rent under
the Master Sublease is allocated to LSO under Section 4.1 ("Additional Rent").
For avoidance of doubt, no additional rent or fees will be payable under this
Section 4.2 for services that are included in the operating expenses charged to
LSC under Section 3.2 of the Master Sublease. On or about the first day of every
calendar month, LSC will submit to LSO a reasonably detailed written invoice for
any Additional Rent for services properly performed during the prior calendar
month. LSO will pay LSC the amounts properly payable under each invoice within
thirty (30) days after receipt.
4.3 RECORDS. Upon reasonable request, LSC will furnish such information as
LSO may reasonably request to verify any amounts payable hereunder. Further, LSO
will have the right to review and audit LSC's books and records upon reasonable
advance notice to verify the calculation of the amounts payable under this
Section 4.
SECTION 5. USE. The Subleased Premises and Shared Areas will be used and
occupied by LSO only for general purpose use, including, without limitation, dry
and wet laboratory, and research and development. LSC represents that the
Subleased Premises and Shared Areas can be used for such purposes under the
Master Lease and Master Sublease. LSO will observe at all times (a) any and all
rules and regulations promulgated by the Master Landlord that are applicable to
the Subleased Premises and Shared Areas or any occupant thereof; and (b)
commercially reasonable safety and security
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regulations established by LSC in consultation with LSO for the use or occupancy
of the Subleased Premises and Shared Areas.
SECTION 6. LOCKS. LSC will furnish LSO with keys and security cards needed for
access to the Subleased Premises and Shared Areas. Upon termination of the Term,
LSO will surrender all keys and security cards to the Subleased Premises and
Shared Areas. LSO will not change the locks to the Subleased Premises without
the prior written consent of LSC and the Sublandlord. LSC will not unreasonably
withhold its consent to any such change.
SECTION 7. INSURANCE. Unless otherwise agreed upon by the parties, during any
period of occupancy, LSC will keep in full force and effect insurance as
required of LSC under Section 14 of the Master Sublease. During the period of
LSO's occupancy, (a) such insurance will name LSO as an additional insured, (b)
LSC will not cancel such insurance without the prior written consent of LSO, and
(c) upon request, LSC will provide certificates to LSO evidencing such
insurance. The premiums and related costs for such insurance will be allocated
to LSO in the same manner that rent is allocated to LSO under Section 4.
SECTION 8. MASTER LEASE AND MASTER SUBLEASE
8.1 ADHERENCE TO MASTER LEASE AND MASTER SUBLEASE. This Sublease is subject
to the terms and conditions of and subordinate to the Master Lease and Master
Sublease. LSO will be bound by all obligations and responsibilities of LSC as
tenant under the Master Sublease and hereby assumes the obligations of LSC
thereunder with respect to the Subleased Premises, except to the extent such
obligations are inconsistent with LSO's obligations under this Sublease or are
addressed by the terms and conditions of this Sublease. LSO will not knowingly
take any actions that will cause LSC to be in default under the Master Sublease
or Sublandlord to be in default under the Master Lease.
8.2 GOOD STANDING. LSC represents and warrants that (a) the Master Sublease
is in good standing, and, to its knowledge, the Master Lease is in good
standing; (b) there are no agreements other than the Master Sublease and Master
Landlord's Consent to Sublease between LSC and the Sublandlord concerning the
use of the Subleased Premises or Shared Areas; and (c) LSC is not in breach or
default, and has not received notice of any breach or default, under the Master
Sublease, and, to its knowledge, Sublandlord is not in breach or default under
the Master Lease. LSC will immediately notify LSO if LSC receives oral or
written notice from Sublandlord of a breach or default under the Master
Sublease.
8.3 PERFORMANCE. LSC will perform all of its obligations under the Master
Sublease. LSC will use diligent good faith efforts to cause the Sublandlord to
perform its obligations under the Master Sublease.
8.4 AMENDMENT; TERMINATION; RENEWAL. LSC will not amend or voluntarily
terminate the Master Sublease, or surrender all or any portion of the Subleased
Premises or Shared Areas, without LSO's prior written consent. At least thirty
(30) days before the first day that LSC has to exercise its option to extend the
term of the Master Sublease, LSC will notify LSO whether LSC will exercise its
option to extend the term of the Master Sublease. If LSC notifies LSO that LSC
will not exercise its option to extend the term of the Master Sublease, then LSC
will cooperate and assist LSO to assume and extend the Master Sublease to enable
LSO to sublease the Subleased Premises and Shared Areas from the Sublandlord. If
LSC notifies LSO that LSC will exercise its option to extend the Master
Sublease, then LSC will timely and properly exercise its option to extend the
term of the Master Sublease.
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SECTION 9. ASSIGNMENT AND SUBLETTING. LSO will not sublet the Subleased Premises
or assign this Sublease or any part thereof for any period of time without the
prior consent of Master Landlord, Sublandlord and LSC. LSC will not assign this
Sublease or any part thereof without the prior consent of LSO. Neither party
will unreasonably delay, withhold or condition its consent.
SECTION 10. INDEMNIFICATION. LSO will indemnify, defend and hold harmless LSC,
Sublandlord and Master Landlord from any claim, liability or suit, including
reasonable attorneys' fees, for any injury or damage occurring in or about the
Subleased Premises or Shared Areas where such damage or injury was caused by any
act, omission, negligence or intentional act of LSO or by LSO's agents,
employees, servants, customers, clients, contractors or invitees. LSC will
indemnify, defend and hold harmless LSO from any claim, liability or suit,
including reasonable attorneys' fees, for any injury or damage occurring in or
about the Subleased Premises or Shared Areas where such damage or injury was
caused by any act, omission, negligence or intentional act of LSC or by LSC's
agents, employees, servants, customers, clients, contractors or invitees. The
indemnification obligations contained in this Section will not be limited by any
worker's compensation, benefit or disability laws, and each indemnifying party
hereby waives (solely for the benefit of the indemnified party) any immunity
that said indemnifying party may have under the Industrial Insurance Act, Title
51 RCW and similar worker's compensation, benefit or disability laws. LSO AND
LSC ACKNOWLEDGE BY THEIR EXECUTION OF THIS SUBLEASE THAT EACH OF THE
INDEMNIFICATION PROVISIONS OF THIS SUBLEASE (SPECIFICALLY INCLUDING BUT NOT
LIMITED TO THOSE RELATING TO WORKER'S COMPENSATION BENEFITS AND LAWS) WERE
SPECIFICALLY NEGOTIATED AND AGREED TO BY LSO AND LSC.
SECTION 11. QUIET ENJOYMENT. Provided LSO has satisfied its obligations under
Section 4, LSO will peaceably and quietly hold and enjoy the Subleased Premises
for the Term.
SECTION 12. CONFIDENTIALITY. Neither party will use the Confidential Information
of the other party or disclose, disseminate, display, publish or distribute any
Confidential Information of the other party to any person or entity without the
prior written consent of the disclosing party. Each party will exercise due care
(i.e., at least as much care as it affords its own confidential information) to
prevent unauthorized disclosure or use of Confidential Information of the
disclosing party. Without limiting the foregoing, the receiving party will make
the Confidential Information of the disclosing party available only to those of
its employees, agents and other representatives who have a need to know the same
for a purpose authorized by the disclosing party, who have been informed that
the Confidential Information belongs to the disclosing party, and who have
agreed or are otherwise obligated to comply with this Section 12. "Confidential
Information" means any trade secrets or other information of a party disclosed
to or learned or acquired by the other party and not generally available to the
public, whether of a technical, business or other nature (including, without
limitation, information relating to a party's research, studies, drugs, clinical
data, products, developments, designs, methods, manufacturing processes,
business plans, finances, personnel, marketing plans, customers, suppliers,
prospects or other affairs). However, Confidential Information does not include
any information that: (a) was known by the receiving party prior to
communication by the disclosing party; (b) is a matter of public knowledge at
the time of such disclosure by the disclosing party; (c) becomes a matter of
public knowledge, without fault on the part of the receiving party, subsequent
to disclosure by the disclosing party to the receiving party; or (d) has been
disclosed to the receiving party from a third party lawfully having possession
of such Confidential Information without an obligation of confidentiality to the
disclosing party. Subparagraph (a) will not apply to Confidential Information
transferred from LSC to LSO under the Asset Transfer Agreement entered into in
connection with this Sublease. Notwithstanding the foregoing restrictions, the
receiving
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party may disclose or produce any Confidential Information of the disclosing
party if and to the extent required by any discovery request, subpoena, court
order, governmental action, or to the extent the receiving party believes in
good faith on the basis of an opinion of counsel that such disclosure is
required by applicable law or regulation; provided, that the receiving party
gives the disclosing party reasonable advance notice of the same (e.g., so as to
afford the disclosing party a reasonable opportunity to appear, object and
obtain a protective order or other appropriate relief regarding such
disclosure).
SECTION 13. MISCELLANEOUS
13.1 NOTICES. All notices and other communications hereunder will be in
writing and will be deemed given if delivered personally, by fax (receipt
confirmed), or by registered or certified mail, return receipt requested and
postage prepaid or sent by express courier service (receipt verified), to the
parties at the following addresses (or at such other addresses for a party as
will be specified by the like notice; provided, that notices of a change of
address will be effective only upon receipt thereof):
To LSO: Light Sciences Oncology, Inc.
00000 XX Xxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxxxx, XX 00000
Attn.: Xxx Xxxxxxx, M.D.
Fax: ____________________________
To LSC: Light Sciences Corporation
00000 XX Xxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxxxx, XX 00000
Attn.: __________________________
Fax: ____________________________
All such notices and communications will be deemed effective when received.
13.2. DISPUTE RESOLUTION. Any dispute or claim arising out of or relating
to this Sublease ("Dispute") that cannot be resolved by the parties within ten
(10) days after a party notifies the other party of a Dispute will be referred
to the chief executive officer of LSO and the chief executive officer of LSC. If
the parties' respective chief executive officers do not resolve the Dispute
within ten (10) days after they first discuss the Dispute, then the Dispute will
be settled by binding arbitration in accordance with this Section 13.2. The
arbitration will be conducted by a single arbitrator in accordance with the
rules of the American Arbitration Association. The parties will use their best
efforts to agree upon a mutually acceptable arbitrator within twenty (20) days
after written demand for arbitration under this Section 13.2. The arbitrator's
decision will be in writing, will specify the factual and legal bases of such
decision, will be final and binding on the parties, and a judgment consistent
therewith may be entered by any court of competent jurisdiction. The cost of
arbitration will be borne equally by the parties unless the arbitrator makes a
final determination, which determination will be binding upon the parties, that
one of the parties should be regarded as the prevailing party as to the matters
submitted to the arbitration. Notwithstanding the foregoing, a party may seek
preliminary injunctive or other equitable relief in a court of law if in its
judgment such action is necessary to avoid irreparable damage. The parties will
continue to participate in good faith in the procedures specified in this
Section 13.2 despite such action.
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13.3 NONWAIVER. The failure of either party to insist on or enforce strict
performance of any provision of this Sublease or to exercise any right or remedy
under this Sublease or applicable law will not be construed as a waiver or
relinquishment to any extent of the right to assert or rely upon any such
provision, right or remedy in that or any other instance; rather, the same will
be and remain in full force and effect.
13.4 SEVERABILITY. If any provision of this Sublease will be held by any
court of competent jurisdiction to be invalid, illegal or unenforceable under
applicable law, then such provision will be deemed reformed or omitted to the
extent determined by such court (i.e., with the objective of preserving the
intent of such provision to the extent permitted by applicable law). In any
event, the remainder of this Sublease will remain valid and enforceable.
13.5 GOVERNING LAW. This Sublease will be interpreted, construed and
enforced in all respects in accordance with the laws of the State of Washington,
without reference to its principles relating to conflicts of law.
13.6 ENTIRE AGREEMENT. This Sublease sets forth the entire agreement and
supersedes any and all prior agreements of the parties with respect to the
subject matter hereof. No amendment of this Sublease will be valid unless set
forth in a written instrument signed by the party to be bound thereby.
13.7 CONSENT. This Sublease is expressly conditioned upon consent by
Sublandlord and Master Landlord. This Sublease will be of no force or effect
unless consented to by Sublandlord and Master Landlord.
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IN WITNESS WHEREOF, LSC and LSO have executed this Sublease on the day
first set forth above.
LSO: LSC:
LIGHT SCIENCES ONCOLOGY, INC. LIGHT SCIENCES CORPORATION
By: /s/ Xxx Xxxxxxx By: /s/ Xxxxxx Xxxxxxx
--------------------------------- ------------------------------------
Print: Xxx Xxxxxxx Print: Xxxxxx Xxxxxxx
Its: COO Its: CEO
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STATE OF WASHINGTON )
) ss.
COUNTY OF KING )
I certify that I know or have satisfactory evidence that Xxx
Xxxxxxx is the person who appeared before me, and said person acknowledged that
he/she signed this instrument, on oath stated that he/she was authorized to
execute the instrument, and acknowledged it as the COO of LIGHT SCIENCES
ONCOLOGY, INC., a Washington corporation, to be the free and voluntary act of
such party for the uses and purposes mentioned in the instrument.
Dated: September 30, 2005.
(SEAL)
/s/ Xxxxx X. Xxxxxx
-------------------
(Signature of Notary)
Xxxxx X. Xxxxxx
-------------------
(Print or stamp name of Notary)
NOTARY PUBLIC in and for the State of
Washington, residing at: King County.
My appointment expires: 8-12-09.
SCHEDULE A
MASTER SUBLEASE
SUBLEASE AGREEMENT
This SUBLEASE is made this 9th day of September, 2002 between GREAT
PLAINS SOFTWARE O.C., INC., a Minnesota corporation ("Sublandlord"), and LIGHT
SCIENCES CORPORATION, a Washington corporation ("Subtenant").
Whereas, Sublandlord is the tenant under that certain lease agreement
dated March 2, 2000, with Snoqualmie Ridge Cascade View LLC, a Washington
limited liability company as landlord ("Landlord") (the "Master Lease"), for
space (the "Master Space") located in the building (the "Building") described
below:
Name of Building: Cascade View (Snoqualmie Ridge Business
Park)
Address: 00000 X.X. Xxxxxxx Xxxxxx, Xxxxx 000
Xxxx, Xxxxx and Zip Code: Xxxxxxxxxx, XX 00000
A copy of the Master Lease is attached as Exhibit A.
The Building, and the land on which the Building is located, and the
common areas in the Building and on the land are referred to collectively as the
Property (the "Property").
In consideration of the covenants and promises contained in this
Sublease, the parties agree as follows:
1. Subleased Premises. Sublandlord agrees to sublease to Subtenant, and
Subtenant agrees to sublease from Sublandlord, the entire Master Space as
described in the Master Lease as the "Premises." Sublandlord shall assign all
its right, title and interest to, and Subtenant shall take ownership of, all
existing furniture, the phone system equipment, and network/data equipment
currently in the Premises on an as-is, where-is, basis without warranty of any
kind, express or implied, as itemized on Exhibit B. In addition to use of the
Premises, Subtenant shall have the same rights of ingress and egress to the
Premises, and any common areas and the benefit of any appurtenant easements and
rights of way, all on such conditions and at such times as permitted by Landlord
and granted under the Master Lease.
2. Term - Option to Renew. This Sublease shall commence on the last to
occur of (a) full execution of this Sublease by the parties and execution of
Landlord's written consent to this Sublease (including the use provision), in
the form attached, and (b) September 1, 2002 ("Commencement Date") and, subject
to sooner termination in accordance with the terms of this Sublease, shall
terminate Sixty Four (64) months after the Commencement Date (the "Term"), which
Term is less than the remaining term under the Master Lease. If Landlord has
failed to deliver its written consent to this Sublease, substantially in the
form attached, by October 1, 2002, either party shall have the right to
terminate this Sublease, by written notice delivered to the other party within
ten (10) days of such date and prior to delivery of Landlord's consent, in which
event this Sublease shall be of no further force and effect.
If Subtenant is not and has not been in default under this Sublease,
Subtenant shall have the option to extend the Term of this Sublease for one
additional period equal to the remaining term of the Master Lease less two (2)
weeks, by giving Sublandlord written notice thereof not more than twelve (12) or
less than nine (9) months prior to the expiration of the initial Term. The terms
and conditions of the Sublease as extended shall remain the same, except Monthly
Rent, which shall be 95% of the then market Illegible for similar office space
in the Snoqualmie Ridge submarket. Subtenant shall submit to Sublandlord,
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with its notice of option exercise, its proposal for such option period rent. If
Sublandlord disagrees with Subtenant's proposal, it shall provide Subtenant with
a counter proposal within twenty (20) days of receipt of Subtenant's proposal.
If Subtenant disagrees with Sublandlord's counterproposal, it shall so notify
Sublandlord within twenty (20) days of receipt thereof, and the Monthly Rent
shall be determined as follows: Subtenant and Sublandlord shall each, within ten
(10) days after notice from Subtenant, select a real estate agent with at least
ten (10) years experience in the office market which includes the Premises, and
each agent so chosen shall select a third with the same qualifications. The
three so chosen shall determine Monthly Rent for the option term and convey
their decision by written notice to the parties. No explanation, hearing or
court-like proceedings are to be conducted. If the three agents are unable to
agree on rent, the two closest rent determinations shall be averaged and the
third shall be disregarded. The option rent so calculated shall be arrived at no
later than thirty (30) days after the agents are selected. Their determination
shall be final and binding on Sublandlord and Subtenant. Compensation for the
agents shall be divided equally between Subtenant and Sublandlord.
3. Rent.
3.1 Monthly Rent. Subtenant agrees to pay Sublandlord monthly rent in
the amount of:
Commencement Date through December 31, 2002: None
January 1, 2003 - April 30, 2003: $9,550.00/month
May 1, 2003 - September 30, 2003: $14,883.33/month
October 1, 2003 thru end of term: $19,768.50/month
Plus, monthly rent shall increase by 3.5% per year beginning with
the rent due September 1, 2004 (the "Monthly Rent"). Monthly Rent shall be paid
in advance on the first day of each month without any prior demand, subject to
receipt of an invoice, and without any deduction or offset whatsoever.
3.2 Additional Rent. Starting on the Commencement Date and during the
Term, in addition to paying the Monthly Rent specified in Section 3.1 above,
Subtenant shall pay all of the "Operating Expenses" (as defined in Section 8 of
the Master Lease) allocated to Sublandlord under the Master Lease. Such payments
by Subtenant, together with any and all other amounts payable by Subtenant to
Sublandlord pursuant to the terms of this Sublease, are hereinafter referred to
as the "Additional Rent." The calculation, payment and reconciliation of the
Additional Rent payments by Subtenant and Sublandlord shall be made in the same
manner as between Landlord and Tenant under Section 8 of the Master Lease.
Sublandlord shall, at Sublandlord's option, credit or refund to Subtenant
Subtenant's Share of any Additional Rent overpayments received by Sublandlord
under the Master Lease, and Subtenant shall pay to Sublandlord any Additional
Rent underpayments prior to the date due from Sublandlord under the Master
Lease. Subtenant shall have the right to Audit Annual Reconciliations to the
extent described by Section 1A.8 of the Master Lease.
Any and all sums Subtenant is obligated to pay under the terms of
this Sublease shall be construed as rent obligations, in addition to the monthly
rent set forth in this Sublease. In addition, such additional rent shall include
a service charge of One Hundred Dollars ($100.00) for each of Subtenant's
dishonored checks returned by the institution on which said checks are drawn.
If, at any time during the term of this Sublease, Subtenant has tendered payment
by check and Subtenant's bank has returned more than one such payment for any
reason, including insufficient funds, Sublandlord may, at its option, require
that all future payments be made by cashier's check.
4. Security Deposit. Subtenant has deposited with Sublandlord the sum of
Nineteen Thousand Seven Hundred Sixty Eight and 50/100 Dollars ($19,768.50),
which shall be held by
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Sublandlord as a security deposit for Subtenant's performance of all of the
terms, covenants and conditions of this Sublease (the "Security Deposit"). If
Subtenant defaults under any provision of this Sublease, and if Subtenant fails
to remedy the default within any cure period provided for in section 12 below,
Sublandlord may (but shall not be required to) use, apply or retain all or any
part of this Security Deposit for the payment of any amount Sublandlord may
reasonably spend by reason of Subtenant's default or to compensate Sublandlord
for any loss or damage Sublandlord may suffer because of Subtenant's default.
If, during the term of this Sublease, any portion of the Security Deposit is so
used or applied, Subtenant shall, within ten (10) days after written demand,
deposit cash with Sublandlord in an amount sufficient to restore the Security
Deposit to its original amount. Sublandlord is not required to keep the Security
Deposit separate from its general funds, and Subtenant is not entitled to
interest on the Security Deposit. If Subtenant performs each of its obligations
under this Sublease, the Security Deposit, or any balance thereof, shall be
returned to Subtenant within sixty (60) days after the later of the expiration
of the Sublease term or the date Subtenant vacates the Premises.
5. Alterations. Sublandlord hereby approves the Alterations set forth on
Exhibit C attached hereto. Subtenant shall not make any other improvements in or
alterations or additions (collectively, "Alterations") to the Premises without
first obtaining Sublandlord's written consent (and any consent required under
the Master Lease) which shall not be unreasonably withheld. All Alterations
shall be at the sole cost and expense of Subtenant and, except to Subtenant's
trade fixtures, furniture and equipment, shall remain in and be surrendered with
the Premises at the termination of this Sublease. However, Sublandlord, in its
sole and absolute discretion, may elect to require Subtenant to remove from the
Premises any or all Alterations upon the termination of the Sublease, and upon
any such election Subtenant shall promptly do so and shall repair all damages
occasioned by such removal and return the Premises to their original condition
to Sublandlord's reasonable satisfaction, all at Subtenant's sole cost and
expense.
All Alterations undertaken by Subtenant shall be performed by a
contractor approved in advance by Sublandlord, according to plans approved in
advance by Sublandlord. Subtenant shall cause all work to be done in a good and
workmanlike manner using materials equal to or better than those used in the
construction of the Premises and shall comply with or cause compliance with all
laws and with any direction given by any public officer pursuant to law,
including, without limitation, Title III of the Americans with Disabilities Act
of 1990 ("ADA"), as the same are in effect on the date hereof and may be
hereafter modified, amended or supplemented. During construction, Subtenant or
its general contractor shall procure and maintain in effect all insurance
coverages required under the Master Lease and any additional insurance coverage
required by Sublandlord at its sole discretion.
6. Condition of Premises. Subtenant has thoroughly inspected the Premises
and accepts them in their present condition, AS IS WITH ALL FAULTS. Subtenant
acknowledges that neither Sublandlord nor any agent of Sublandlord has made any
representation as to the condition of the Premises or their suitability for the
conduct of Subtenant's business. Subtenant and Sublandlord expressly agree that
there are and shall be no implied warranties of merchantability, habitability,
fitness for a particular purpose or any other kind arising out of this Sublease.
7. Landlord's Services. Under the Master Lease Landlord is obligated to
provide Sublandlord with certain operating services, maintenance and repairs
(collectively, "Landlord's Services"). To the extent Landlord's Services apply
to the Premises, Subtenant shall have the benefit of such services. Sublandlord
has no obligation to furnish any of Landlord's Services and will not be liable
for any disruption or failure of such services, except to the extent such
disruption or failure arises from the breach of Sublandlord's enforcement
obligations set forth in the following two sentences. Upon receipt of written
complaint from Subtenant, Sublandlord shall make prompt demand upon Landlord to
take all appropriate action for the correction of any defect, inadequacy or
insufficiency in Landlord's
3
provision of Landlord's Services. If necessary, upon written request of
Subtenant, Sublandlord shall enforce its rights under the Master Lease to
Landlord's Services for Subtenant's benefit by litigation, in which event
Subtenant shall reimburse Sublandlord for the reasonable costs and expenses of
such enforcement (including reasonable attorneys' fees) to the extent such costs
and expenses are not recovered from Landlord and not caused by Sublandlord's
breach of this Sublease, negligence or willful acts. Subtenant shall be
responsible for all utility costs associated with the Premises, and Sublandlord
shall be responsible for separately metering the utilities to the Premises.
8. Subtenant's and Sublandlord's Maintenance and Repairs.
8.1 Maintenance of Premises. Subtenant shall, at its expense, maintain
the Premises, including, without limitation, all improvements to the Premises,
in good order, condition and repair to the same extent required of Sublandlord
under the Master Lease, excepting only reasonable wear and tear.
8.2. Repair of Building and Common Areas. Except for repairs required
to be made by Landlord under the Master Lease, all repairs to the Property other
than the Premises shall be coordinated by and through Sublandlord. To the extent
the repairs are not paid for from Landlord's insurance, the costs of repair will
be paid in the following manner:
(a) The Premises. Subtenant shall pay for any repairs conducted
in the Premises.
(b) The Property Other Than the Premises. Sublandlord shall not
have responsibility for repair or maintenance of the Building or the property of
which the Premises are located. However, to the extent Landlord has such repair
and maintenance obligations under the Lease, upon receipt of a written complaint
from Subtenant, Sublandlord shall make prompt demand upon Landlord to take all
appropriate action to fulfill its repair and maintenance obligations. If
necessary, upon written request of Subtenant, Sublandlord shall enforce its
rights under the Master Lease regarding Landlord's said repair and maintenance
obligations for Subtenant's benefit by litigation, in which event Subtenant
shall reimburse Sublandlord for the reasonable costs and expense of such
enforcement (including reasonable attorneys' fees) to the extent such costs and
expenses are not recovered from Landlord, and not caused by Sublandlord's breach
of this Sublease, negligence or willful acts.
Subtenant shall pay for any repairs conducted in the
Property to the extent the damage was caused by Subtenant or an employee, guest,
or agent of Subtenant.
Subtenant shall promptly notify Sublandlord of any condition
in the Property that is in need of repair.
9. Use. Subtenant shall only use the Premises for general office use,
including software development, dry and wet laboratory use, sales and training
and for no other purposes whatsoever. Subtenant shall not do or permit anything
to be done in or about the Property that will in any way interfere with the
rights of Sublandlord or other occupants of the Building, or injure or annoy
them, or use or allow the Property to be used for any improper, immoral,
unlawful or objectionable purpose; nor shall Subtenant cause, maintain or permit
any nuisance in, on or about the Property. Subtenant shall not commit or suffer
to be committed any waste in or about the Property.
10. Sign Restriction. Subtenant may, at its expense, place its name and
corporate logo on the Premises and Building directory in accordance with and
subject to the terms and conditions of the Master Lease and all applicable law.
4
11. Locks. No additional locks shall be placed upon any doors of the
Premises without Sublandlord's consent, which shall not be unreasonably
withheld. Keys and security cards will be furnished to each lock for access to
the Premises at times as permitted by Sublandlord. At the termination of the
Sublease, Subtenant shall surrender to Sublandlord all keys and security cards
to the Premises.
12. Defaults. Any of the following occurrences shall constitute a default
by Subtenant:
12.1 Failure to Pay Money When Due. If Subtenant fails to make any
payment of rent, additional security deposit or any other payment required to be
made by Subtenant hereunder, as and when due, for a three (3 day period after
written notice from Sublandlord.
12.2 Other Breaches. If Subtenant fails to observe or perform any
other provision of this Sublease, including compliance with Landlord's Rules and
Regulations, for a twenty (20) day period after written notice from Sublandlord.
The 20-day grace period shall not apply to Sublandlord's right to exercise
remedies under Section 13(a) only with respect to Subtenant's breach of its
obligations to maintain unexpired insurance coverages in full compliance with
Section 14 of this Sublease.
13. Remedies. If Subtenant commits a default under this Sublease,
Sublandlord may do any one or more of the following, in addition to pursuing its
remedies under law:
(a) Cure the default and charge the costs to Subtenant, in which case
Subtenant shall pay such costs as additional rent promptly on demand, together
with interest thereon at the rate of eighteen percent (18%) per year or the
highest rate permitted by law, whichever is less.
(b) Terminate this Sublease.
(c) Enter and take possession of the Premises and remove Subtenant and
all other persons and any property from the Premises, with process of law.
(d) Hold Subtenant liable for and collect rent and other indebtedness
owed by Subtenant to Sublandlord or rent that would have accrued during the
remainder of the term had there been no default, less any sums Subtenant proves
could reasonably have been avoided.
(e) Hold Subtenant liable for that part of the following sums paid by
Sublandlord that are attributable to the remainder of the term:
(i) Customary broker's fees incurred by Sublandlord in reletting
part or all of the Premises;
(ii) The cost of removing and storing Subtenant's property;
(iii) The reasonable cost of repairs and alterations reasonably
necessary to put the Premises in a condition reasonably acceptable to a new
subtenant for the substantially same use as permitted in the Master Lease or
approved by the Landlord; and
(iv) Other necessary and reasonable expenses incurred by
Sublandlord in enforcing its remedies.
Sublandlord shall mitigate its damage by making reasonable efforts to
relet the Premises on reasonable terms. Sublandlord may relet for a shorter or
longer period of time than the Sublease term and make reasonably necessary
repairs and alterations. All sums collected from reletting shall be applied
5
first to Sublandlord's expenses of reletting described in Section 13(e), and
then to the payment of amounts due from Subtenant to Sublandlord under this
Sublease.
14. Insurance. Subtenant shall, during any period of occupancy, at its sole
cost and expense, keep in full force and effect the following insurance:
14.1 Liability Insurance. A policy of general commercial liability
insurance satisfying the requirements of the Master Lease regarding insurance to
be carried by Sublandlord and naming both Sublandlord and Landlord as additional
insureds. Such liability policy shall (a) insure against any and all claims or
liability arising out of the use or maintenance of the Property under this
Sublease, in an amount not less than Three Million Dollars ($3,000,000) per
occurrence covering bodily injury to persons, including death, and damage to
property; (b) insure the hazards of the Property and Subtenant's operations
thereon, independent contractors, contractual liability (covering all indemnity
provisions of this Sublease); and (c) contain a cross-liability provision and a
provision that the insurance provided Sublandlord and Landlord hereunder shall
be primary and non-contributing with any other insurance.
14.2 Property Damage Insurance. A fire and extended coverage insurance
policy on the improvements to the Premises satisfying the requirements of the
Master Lease regarding insurance to be carried by Sublandlord and naming both
Sublandlord and Landlord as additional insureds as their interests may appear.
Such policy shall (a) be a standard form of property insurance insuring against
the perils of fire, extended coverage, vandalism, malicious mischief, special
extended coverage ("All-Risk") and sprinkler leakage, and (b) be upon all
property owned by Subtenant, or for which Subtenant is legally liable, or that
was installed at Subtenant's expense, and that is located at the Premises,
including, but not limited to, furniture, fittings, installations, fixtures, and
any other personal property of Subtenant, in an amount not less one hundred
percent (100%) of the full replacement cost thereof.
14.3 General Requirements. All policies shall be written in a form
(including amount of deductibles, if any) satisfactory to Sublandlord and shall
be taken out with insurance companies holding a General Policyholders Rating of
"A" and a Financial Rating of "X" or better, as set forth in the most current
issue of Best's Insurance Reports, but in any event not less than the rating
required under the Master Lease.
Within ten (10) days after written request from Sublandlord,
Subtenant shall deliver to Sublandlord copies of policies or Certificates of
Insurance complying with this Sublease, in form satisfactory to Sublandlord. No
such policy shall be cancelable or reducible in coverage except after thirty
(30) days prior written notice to Sublandlord. If Subtenant fails to obtain,
maintain and/or provide evidence of insurance required hereunder, Sublandlord
may obtain the same and Subtenant shall, upon demand, reimburse Sublandlord for
the reasonable cost thereof. No such action by Sublandlord or reimbursement from
Subtenant shall be a waiver of default or other remedies. In no event shall the
limits of such policies be considered as limiting liability of Subtenant under
this Sublease.
15. Waiver of Recovery. Sublandlord and Subtenant each release and relieve
the other, and waive their entire rights of recovery for loss or damage to
property located within or constituting a part or all of the Property to the
extent that the loss or damage is covered by (a) the injured party's insurance,
or (b) the insurance the injured party is required to carry under Section 14,
whichever is greater. This waiver applies whether or not the loss is due to the
negligent acts or omissions of Sublandlord or Subtenant, or their respective
officers, directors, employees, agents, contractors, or invitees. Each of
Sublandlord and Subtenant shall have their respective property insurers endorse
the applicable insurance policies to reflect the foregoing waiver of claims,
provided, however, that the endorsement shall not be required if the applicable
policy of insurance permits the named insured to waive rights of subrogation on
a blanket basis, in which case the blanket waiver shall be acceptable.
6
16. Risk. Except as otherwise expressly provided in this Section 16, all of
Subtenant's personal property of any kind or description whatsoever in the
Property shall be at Subtenant's sole risk. Sublandlord and Landlord shall not
be liable for any damage done to or loss of such personal property, injury to
person or damage or loss suffered by the business or occupation of Subtenant
arising from any acts or neglect of co-tenants or other occupants of the
Building, or of any other persons, or from bursting, overflowing or leaking of
water, sewer or steam pipes, or from the heating or plumbing or sprinkler
fixtures, or from electric wires, or from gas, or odors, or caused in any other
manner whatsoever unless and to the extent the damage is caused by the willful
misconduct of Sublandlord or breach of Sublandlord's obligations under this
Sublease or under the Master Lease.
17. Indemnification. Subject to Section 15 above, Subtenant will defend,
indemnify and hold harmless Sublandlord and Landlord from any claim, liability
or suit, including attorney fees, on behalf of any party for any injury or
damage occurring in or about the Premises where such damage or injury was caused
by any act, omission, negligence or intentional act of Subtenant or by
Subtenant's agents, employees, servants, customers, clients, contractors, or
invitees. Subject to Section 15 above, Sublandlord will defend, indemnify and
hold harmless Subtenant from any claim, liability or suit, including attorney
fees, on behalf of any party for any bodily injury or property damage occurring
in or about the Premises to the extent the damage or injury was caused by the
negligence, act, omission or intentional act of Sublandlord, its agents,
employees, servants, customers or clients. The indemnification obligations
contained in this Section shall not be limited by any worker's compensation,
benefit or disability laws, and each indemnifying party hereby waives any
immunity that the indemnifying party may have under the Industrial Insurance
Act, Title 51 RCW and similar worker's compensation, benefit or disability laws.
SUBLANDLORD AND SUBTENANT ACKNOWLEDGE BY THEIR EXECUTION OF THIS SUBLEASE THAT
EACH OF THE INDEMNIFICATION PROVISIONS OF THIS LEASE (SPECIFICALLY INCLUDING BUT
NOT LIMITED THOSE RELATING TO WORKER'S COMPENSATION BENEFITS AND LAWS) WERE
SPECIFICALLY NEGOTIATED AND AGREED TO BY SUBLANDLORD AND SUBTENANT.
18. Casualty & Condemnation. Under certain circumstances described in the
Master Lease, either Landlord or Sublandlord may terminate the Master Lease if
there is a fire or other casualty damaging the Building or the Premises, or if
there is a condemnation affecting the Building. Any such termination will
automatically terminate this Sublease. If this Sublease is not terminated, Rent
will xxxxx to the same extend as rent is abated under the Master Lease.
19. Master Lease.
19.1 Good Standing. Sublandlord represents and warrants that (a) the
Master Lease is in good standing, (b) there are no agreements other than the
Master Lease between Landlord and Sublandlord concerning the use of the
Premises, (c) notwithstanding Section 19.2, that Sublandlord's interest in the
Master Lease, the Premises and all property identified in Exhibit B are free
from liens or encumbrances, and (d) to Sublandlord's actual knowledge,
Sublandlord has not received notice of any breach or default of the Master Lease
by Sublandlord that has not been cured as of the date of this Sublease.
19.2 Subordination. This Sublease is subject and subordinate to
the Master Lease, to all ground and underlying leases, and to all mortgages and
deeds of trust which may now or hereafter affect the Property, and to any and
all renewals, modifications, consolidations, replacements and extensions
thereof. Sublandlord agrees not to effect any modification or amendment of the
Master Lease that materially and adversely affects the rights of Subtenant
hereunder without the written consent of Subtenant (which consent shall not be
unreasonably withheld, conditioned or delayed and shall be
7
deemed granted if not refused within ten (10) days of written request).
Subtenant agrees, upon request of Sublandlord, at any time or times, to execute
and deliver to Sublandlord any and all instruments as shall be required by
Landlord to effect a subordination of this Sublease in accordance with and
subject to the terms of the Master Lease.
19.3 Adherence to Terms of Master Lease. Subtenant agrees to be bound
by all obligations and responsibilities of Sublandlord as tenant under the
Master Lease, and hereby assumes all obligations of Sublandlord thereunder, to
the extent such obligations and responsibilities are not expressly inconsistent
with or addressed by the terms or conditions of this Sublease, including any
Exhibits appended hereto. Subtenant shall neither do nor permit anything to be
done that would cause Sublandord to be in default under the Master Lease.
20. Right of Entry. Upon reasonable prior notice to Subtenant (except in
the case of emergency), Sublandlord shall have the right to enter the Premises.
21. Parking. Sublandlord shall provide to Subtenant at no additional charge
One hundred fifteen (115) unreserved parking spaces, to which Sublandlord is
entitled under the Master Lease.
22. Rules and Regulations. Subtenant shall observe at all times any and all
rules and regulations promulgated by Landlord that are applicable to the
Premises or any occupant thereof.
23. Subletting/Assignment.
23.1 Consent Required. Subtenant shall not sublet the Premises or
assign this Sublease or any part thereof for any period of time without the
prior consent of the Landlord and without Sublandlord's Prior consent. Such
consent by Sublandlord shall not be unreasonably withheld except: (a)
Sublandlord may withhold in its absolute and sole discretion consent to any
mortgage, hypothecation, pledge or other encumbrance of any interest in this
Sublease or the Premises by Subtenant, whereby this Sublease or any interest
therein becomes collateral for any obligation of Subtenant; and (b) Sublandlord
may withhold in its absolute and sole discretion consent if Landlord does not
consent to the proposed transfer. It is agreed that any of the following
factors, or any other reasonable factor, will be reasonable grounds for
Sublandlord deciding whether to consent to Subtenant's request: (i) occupancy by
any proposed assignee, subtenant or other transferee is not consistent with the
maintenance and operation of a Class A office building due to the nature of the
proposed occupant's business or the manner of conducting its business or its
experience or reputation in the community, (ii) occupancy by any proposed
assignee, subtenant or other transferee is likely to cause disturbance to the
normal use and occupancy of the Building by Sublandlord or other occupants; and
(iii) notwithstanding that Subtenant or others remain liable under this
Sublease, whether the proposed assignee, subtenant or other transferee has a net
worth, financial strength and credit record satisfactory to meet all of the
obligations of Subtenant under this Sublease.
23.2 Recapture. In lieu of granting a consent to a proposed sublease,
assignment or other transfer, Sublandlord reserves the right to terminate this
Sublease or, in the case of a subletting of less than all the Premises, to
terminate this Sublease with respect to such portion of the Premises, as of the
proposed effective date of such subletting or assignment, in which event
Sublandlord may enter into the relationship of landlord and tenant with any
other person or entity (including the sublessee or assignee proposed by
Subtenant) on such terms and conditions as Sublandlord may deem acceptable.
23.4 Effect of Transfer. No subletting, assignment or other transfer
under this Article 24 shall relieve Subtenant of any liability under this
Sublease, and no consent to any such transfer
8
shall operate as a waiver of the necessity for consent to a subsequent transfer.
Subtenant promptly shall provide Sublandlord with copies of any instruments of
transfer.
24. Notice. Any notice regarding a breach of this Sublease or termination
thereof shall be in writing and be sent by certified mail or personally
delivered to, in the case of Sublandlord:
Microsoft Corporation
Xxx Xxxxxxxxx Xxx
Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxx Xxxxxx,
GM, Worldwide Real Estate &
Facilities
With a copy to:
Microsoft Corporation
Xxx Xxxxxxxxx Xxx
Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxxxx,
Law and Corporate Affairs
Or, in the case of Subtenant:
Light Sciences Corporation
___________________________
___________________________
___________________________
Attention: General Counsel,
___________________________.
Notice shall be deemed given when so delivered to Sublandlord or
Subtenant, or on the date delivery is refused, or three (3) days after it is
placed, properly addressed with postage prepaid, in a depository for United
States certified mail. Either party may provide for a different address by
notifying the other party of said change as provided for herein. Subtenant
agrees to deliver to Sublandlord, simultaneously with delivery to Landlord, a
copy of any notice, demand, request, consent or approval Subtenant sends to
Landlord. Each party agrees to promptly deliver to the other party a copy of any
notice, demand, request, consent or approval received from Landlord and not
transmitted directly to such other party which is relevant on its face to the
rights and obligations hereunder of the other party.
25. Estoppel Certificate. Upon Sublandlord's request, at any time and from
time to time, Subtenant shall execute and deliver to Sublandlord:
(a) An estoppel in favor of Landlord and Sublandlord in accordance
with and subject to the terms of the Master Lease, and
(b) Within seven (7) business days after receipt of the request, a
written instrument, duly executed in favor of Sublandlord:
(i) Certifying that this Sublease has not been amended or
modified and is in full force and effect or, if there has been a modification or
amendment, that this Sublease is in full force and effect as modified or
amended, and stating the modifications or amendments;
9
(ii) Specifying the date to which the rent has been paid;
(iii) Stating whether, to Subtenant's best knowledge, Sublandlord
is in default and, if so, stating the nature of the default; and
(iv) Stating the commencement date of the term and whether any
option to extend the term has been exercised.
26. Surrender of Premises. Subtenant shall, on the last day of the term of
this Sublease, or upon any earlier termination, remove all of its furniture,
furnishings, personal property and equipment and surrender to Sublandlord the
Premises and all improvements to the Premises broom clean in good order,
condition and state of repair, reasonable wear and tear excepted.
27. Holding Over. If Subtenant holds over after expiration or termination
of this Sublease without written consent of Sublandlord (which consent may be
withheld in Sublandlord's sole judgment), Subtenant shall pay three times the
fixed minimum monthly rental in effect during the last month hereof and all
other charges due hereunder for each month or any part thereof of any such
holdover period. No holding over by Subtenant after the term of this Sublease
shall operate to extend the Sublease term. In the event of any unauthorized
holding over, Subtenant shall indemnify Sublandlord against all costs and claims
for damages, including, without limitation, any claims for damages by any other
tenant to whom Sublandlord or Landlord may have leased all or any part of the
Premises.
If Subtenant holds over after expiration of the term of this Sublease,
or after the Sublease is terminated, with Sublandlord's consent, Subtenant shall
be deemed to be occupying the Premises under a month-to-month tenancy, and
subject to all the terms, covenants and conditions of this Sublease (other than
the term), except that minimum monthly rent shall be one hundred fifty percent
(150%) of the minimum monthly rent for the last month of the term and the
tenancy shall be terminable by either party on twenty (20) days written notice
to the other party, effective as of the last day of a calendar month.
28. Consent by Sublandlord. Whenever Sublandlord's consent or approval is
required under this Sublease, such consent or approval may be withheld at
Sublandlord's sole discretion, except as otherwise expressly provided in this
Sublease.
29. Successors and Assigns. Subject to the restriction contained in Section
24, the covenants and conditions contained in this Sublease shall bind the
heirs, successors, executors, administrators and assigns of the parties.
30. Brokers. Sublandlord and Subtenant each represents and warrants to the
other that, other than Xxxxx Xxxxxx of Xxxxxxxx Xxxx Company, which represents
Sublandlord, and Xxx Xxxxxxxxx of Alexander Commercial Real Estate, which
represents Subtenant, it did not deal with any broker in connection with this
transaction. Each party agrees to indemnify and defend the other against any
loss, cost or liability, including, without limitation, attorneys' fees, in
connection with the claims of any broker arising from such party's acts.
31. Attorney Fees. In the event legal proceedings are initiated to enforce
any provision of this Sublease, to recover any rent due under this Sublease, for
the breach of any covenant or condition of this Sublease, or for the restitution
of the Premises to the Sublandlord and/or eviction of the Subtenant, the
prevailing party shall be entitled to recover, as an element of its cost of suit
and not as damages, reasonable attorney fees and costs to be fixed by the court.
10
32. Entire Agreement, Merger and Waiver. This Sublease supersedes and
cancels all previous negotiations, arrangements, offers, agreements or
understandings, if any, between the parties. This Sublease expresses and
contains the entire agreement of the parties and there are no express or implied
representations, warranties or agreements between them, except as contained in
this Sublease. This Sublease may not be modified, amended or supplemented except
by a writing signed by both Sublandlord and Subtenant. No consent given or
waiver made by Sublandlord of any breach of Subtenant of any provision of this
Sublease shall operate or be construed in any manner as a waiver of any
subsequent breach of the same or of any other provision.
33. Captions. The captions of this Sublease are provided for convenience
only and shall not be used in construing its meaning.
34. Severability. If any provision of this Sublease is found to be
unenforceable, the remainder of this Sublease shall not be affected thereby.
35. Authority. If Subtenant is a corporation or partnership, each
individual executing this Sublease on behalf of Subtenant represents and
warrants that he or she is duly authorized to execute and deliver this Sublease
on behalf of Subtenant and that this Sublease is binding upon Subtenant
according to its terms. If Subtenant is a corporation, each individual executing
this Sublease on behalf of Subtenant represents and warrants that his or her
authorization to execute and deliver this Sublease was in accordance with a duly
adopted resolution of Subtenant's Board of Directors and Subtenant's Bylaws.
Concurrently, with execution of this Sublease, Subtenant shall deliver to
Sublandlord such evidence of authorization as Sublandlord may require.
36. Sublandlord and Subtenant Relationship Only. Nothing contained in this
Sublease shall be construed to create the relationship of principal and agent,
partnership, joint venturer or any association between Sublandlord and
Subtenant.
37. Memorandum of Lease. This Sublease shall not be recorded, and no
memorandum of this Sublease shall be recorded.
38. Consent to Sublease by Landlord. Sublandlord's obligations under this
Sublease are subject to Landlord's consent to (a) this Sublease; (b) the use
provision contained herein; and (c) the Subtenant Alterations set forth in
Exhibit C. Accordingly, it shall be a condition precedent of Sublandlord's
obligations hereunder that Sublandlord has obtained such consent of Landlord.
Sublandlord and Subtenant hereby agree, for the benefit of Landlord, that this
Sublease and Landlord's consent hereto shall not (a) be deemed to have amended
the Master Lease in any regard (unless Landlord shall have expressly agreed in
writing to such amendment); or (b) be construed as a waiver of Landlord's right
to consent to an assignment of the Master Lease by Sublandlord or any further
subletting of the Master Space, as and to the extent provided in the Master
Lease. Landlord's consent shall, however, be deemed to evidence Landlord's
agreement to the use provisions of this Sublease, the Alterations set forth in
Exhibit C, and that Subtenant shall be entitled to any waiver of claims and of
the right of subrogation for damage to Landlord's property if and to the extent
that the Master Lease provides such waivers for the benefit of Sublandlord.
39. Environmental.
(a) Neither Subtenant nor its officers, directors, agents,
contractors, employees or invitees will use, generate, manufacture, produce,
store, release, discharge or dispose of on, under or about the Premises, or
off-site the Premises affecting the Property, or transport to or from the
Premises, any Hazardous Substance except in compliance with Environmental Laws.
The term "Hazardous
11
Substance" means any hazardous or toxic substance, material or waste, pollutants
or contaminants, as defined, listed or regulated now or in the future by any
federal, state or local law, ordinance, code, regulation, rule, order or decree
regulating, relating to or imposing liability or standards of conduct
concerning, any environmental conditions, health or industrial hygiene,
including without limitation, (i) chlorinated solvents, (ii) petroleum products
or by-products, (iii) asbestos and (iv) polychlorinated biphenyls. The term
"Environmental Law" means any federal, state or local law, statute, ordinance,
regulation or order pertaining to health, industrial hygiene, environmental
conditions or hazardous substances or materials including those defined in this
Article as "Hazardous Substances."
(b) Subtenant shall give prompt written notice to Sublandlord and
Landlord of any proceeding or inquiry by any governmental authority with respect
to the presence of any Hazardous Substance on the Premises; all claims made or
threatened by any third party against Subtenant or the Premises relating to any
loss or injury resulting from any Hazardous Substance; and Subtenant's discovery
of any occurrence or condition on the Premises that could cause the Premises or
any part thereof to be subject to any restrictions on occupancy, or use of the
Premises under any Environmental Law.
(c) Subtenant shall protect, indemnify, defend and hold harmless
Sublandlord and Landlord and their directors, partners, officers, employees,
agents, parents, subsidiaries, successors and assigns from any loss, damage,
cost, expense or liability (including reasonable attorneys' fees and costs)
directly or indirectly arising out of or attributable to the use, generation,
manufacture, production, storage, release, discharge, disposal or presence of a
Hazardous Substance on the Premises or off-site of the Premises affecting the
Property caused by Subtenant or its directors, partners, officers, employees,
agents, contractors and invitees, including without limitation, the costs of any
required or necessary repairs, cleanup or detoxification of the Premises and the
preparation and implementation of any closure, remedial or other required plans.
SUBLANDLORD:
GREAT PLAINS SOFTWARE O.C., INC.
By: /s/ Xxxx Xxxxxx
------------------------------------
Name: Xxxx Xxxxxx
Title: GM, Worldwide Real Estate &
Facilities
SUBTENANT:
LIGHT SCIENCES CORPORATION
By: /s/ XXXXXX X. XXXXXXX
------------------------------------
Name: XXXXXX X. XXXXXXX
Title: President & CEO
00
XXXXXXXXXXX
XXXXX XX XXXXXXXXXX )
)ss.
COUNTY OF KING )
I certify that I know or have satisfactory evidence that Xxxx Xxxxxx is the
person who appeared before me, and said person acknowledged that s/he signed
this instrument, on oath stated that s/he was authorized to execute the
instrument and acknowledged it as the GM, Worldwide Real Estate & Facilities of
Microsoft Corporation to be the free and voluntary act of such party for the
uses and purposes mentioned in the instrument.
Dated: 13 Sept 2002
/s/ Xxxxx Xxx Xxxxxx
----------------------------------------
Notary Public
Print Name: Xxxxx Xxx Xxxxxx
My commission expires 7-9-05
(SEAL)
(Use this space for notarial stamp/seal)
SUBTENANT
STATE OF WASHINGTON )
)ss.
COUNTY OF King )
I certify that I know or have satisfactory evidence that Xxxxxx Xxxxxxx is
the person who appeared before me, and said person acknowledged that s/he signed
this instrument on oath stated that s/he was authorized to execute the
instrument and acknowledged it as the President & CEO of Light Sciences Corp. to
be the free and voluntary act of such party for the uses and purposes mentioned
in the instrument.
Dated: 9-12-02
/s/ Xxxxx X. Xxxxxx
----------------------------------------
Notary Public
Print Name: Xxxxx X. Xxxxxx
My commission expires 8-12-05
(SEAL)
(Use this space for notarial stamp/seal)
13
Exhibit A
MASTER LEASE
A-1
Schedule B
Master Lease
LEASE
SNOQUALMIE RIDGE CASCADE VIEW LLC, LANDLORD
GREAT PLAINS SOFTWARE O.C., INC., TENANT
DATED 3/2/2000
LEASE
TABLE OF CONTENTS
PAGE
----
1. Basic Lease Terms.................................................... 1
1A. Special Lease Terms.................................................. 3
2. Premises............................................................. 7
3. Terms................................................................ 7
3.1 Commence....................................................... 7
3.2 Expire......................................................... 7
4. Tenant Improvements; Early Possession; Delayed Delivery of
Possession........................................................... 7
4.1 Tenant Improvements............................................ 7
4 2 Early Occupancy................................................ 7
4 3 Landlord Delay................................................. 7
4.4 Tenant Delay................................................... 7
5. Rent................................................................. 7
5.1 Rent.......................................................... 7
5.2 Manner of Payment............................................. 8
5.3 Rent Commencement............................................. 8
6. Prepaid Rent and Security Deposit.................................... 8
6.1 [Intentionally deleted.]...................................... 8
6.2 Use of Deposit to Cure........................................ 8
6.3 Return of Security Deposit.................................... 8
6.4 Treatment as Secretary Deposit................................ 8
6.5 Landlord's Obligation Regarding Deposit....................... 8
7. Use of Premises...................................................... 8
7.1 Use........................................................... 8
7.2 Prohibited Uses............................................... 8
7.3 No Nuisance................................................... 9
7.4 Telecommunications Providers.................................. 9
8. Additional Rent for Operating Expenses............................... 9
8.1 Tenant Payment................................................ 9
8.2 Tenant's Share................................................ 9
8.3 Definitions................................................... 9
8.4 Determination of Operating Expenses........................... 11
8.5 Reconciliation................................................ 11
8.6 Upon Lease Termination........................................ 11
8.7 Landlord's Rights............................................. 11
9. Maintenance and Repair Responsibility................................ 11
9.1 Maintenance Obligations....................................... 11
9.2 No Obligation for Alteration.................................. 11
9.3 Tenant Waiver................................................. 11
10. Common Areas......................................................... 11
10.1 Use of Common Areas........................................... 11
10.2 Definition of Common Areas.................................... 12
11. Utilities and Services............................................... 12
11.1 Furnishing of Utilities....................................... 12
11.2 Additional Services........................................... 12
11.3 After Hours................................................... 13
11.4 Separate Meters............................................... 13
11.5 Failure....................................................... 13
i
12. Limits On Landlord's Liability....................................... 13
12.1 Circumstances Beyond Control.................................. 13
12.2 Unreasonable Period of Failure................................ 13
12.3 Tenant Caused................................................. 13
12.4 No Abatement of Rent.......................................... 13
12.5 No Interference............................................... 13
13. Alterations and Additions by Tenant; Liens and Insolvency............ 13
13.1 Alterations and Additions by Tenant........................... 13
13.2 Liens and Insolvency.......................................... 14
14. Insurance; Indemnity................................................. 14
14.1 Tenant Waiver................................................. 14
14.2 Indemnity..................................................... 14
14.3 Landlord's Responsibility..................................... 14
14.4 Tenant's Insurance............................................ 15
14.5 Policies...................................................... 15
14.6 Landlord's Insurance.......................................... 15
14.7 Proceeds...................................................... 15
14.8 Waiver of Subrogation......................................... 16
14.9 Notification of Accidents..................................... 16
15. Destruction.......................................................... 16
15.1 Election to Restore........................................... 16
15.2 Rent Abatement................................................ 16
15.3 Repairs to Tenant Installations............................... 16
15.4 No Compensation............................................... 16
16. Condemnation......................................................... 16
16.1 Termination of Lease.......................................... 16
16.2 Election of Termination....................................... 16
16.3 Reduction of Rent............................................. 17
16.4 Award......................................................... 17
16.5 Landlord Authority............................................ 17
17. Assignment and Subletting............................................ 17
17.1 Landlord Consent Required...................................... 17
17.2 Deemed Assignment.............................................. 17
17.3 Recapture...................................................... 18
17.4 Additional Requirements........................................ 18
17.5 Assignment With Bankruptcy..................................... 18
17.6 Sale........................................................... 18
17.7 Binding........................................................ 18
18. Default.............................................................. 18
18.1 Definition of Default.......................................... 18
18.2 Tenant Notification............................................ 19
18.3 Landlord Default............................................... 19
18.4 [Intentionally deleted.]....................................... 19
19. Remedies in Default.................................................. 19
19.1 Landlord Remedies.............................................. 19
19.2 Tenant Payment of Costs........................................ 19
19.3 Termination.................................................... 19
19.4 No Termination................................................. 20
19.5 Landlord Election to Make Tenant Advances...................... 20
20. Access............................................................... 20
21. Surrender of Premises; Hold-over Tenancy............................. 20
21.1 Surrender of Premises.......................................... 20
21.2 Hold-over Tenancy.............................................. 20
ii
22. Compliance With Laws................................................. 20
23. Rules and Regulations................................................ 21
24. Parking.............................................................. 21
25. Estoppel Certificates................................................ 21
26. Subordination........................................................ 21
27. Removal of Property.................................................. 22
28. Personal Property Taxes.............................................. 22
29. Notices.............................................................. 22
30. Condition of Premises................................................ 22
31. Hazardous Substances................................................. 22
31.1 Tenant's Obligations........................................... 22
31.2 Tenant Indemnity............................................... 22
31.3 Landlord Inspection............................................ 23
31.4 Survival....................................................... 23
32. Signs................................................................ 23
33. General Provisions................................................... 23
33.1 Attorneys' Fees................................................ 23
33.2 Governing Law, Venue........................................... 23
33.3 Cumulative Remedies............................................ 23
33.4 Exhibits; Addenda.............................................. 23
33.5 Interpretation................................................. 23
33.6 Joint Obligation............................................... 23
33.7 Keys........................................................... 24
33.8 Late Charges; Interest......................................... 24
33.9 Light, Air, and View........................................... 24
33.10 Measurements................................................... 24
33.11 Name........................................................... 24
33.12 Prior Agreements; Amendments................................... 24
33.13 Recordation.................................................... 24
33.14 Liability...................................................... 24
33.15 Severability................................................... 25
33.16 Time........................................................... 25
33.17 Waiver......................................................... 25
33.18 No Waste....................................................... 25
33.19 Force Majeure.................................................. 25
33.20 Quiet Enjoyment................................................ 25
33.21 [Intentionally deleted.].......................................
34. Authority of Tenant.................................................. 25
34.1 Tenant as Corporation.......................................... 25
34.2 Tenant as Partnership or LLC................................... 25
35. Financial Statements................................................. 25
36. Commissions.......................................................... 26
Exhibits to This Lease:
Exhibit A-1 Premises
Exhibit A-2 Legal Description of Property
Exhibit A-3 Legal Description of Business Park
Exhibit B Work Letter
iii
LEASE
Lease, dated for reference purposes as of 3/2, 2000, between SNOQUALMIE RIDGE
CASCADE LLC, a Washington limited liability company ("Landlord"), and GREAT
PLAINS SOFTWARE O.C., INC., a Minnesota corporation ("Tenant").
Basic Lease Terms. This Section sets forth certain basic terms of this
Lease for reference purposes. This Section is to be read in conjunction with the
other provisions of this Lease; provided, however, to the extent of any
inconsistency between this Section and the other provisions of this Lease, this
Section shall control.
LEASED PREMISES (See Section 2)
Business Park Snoqualmie Ridge Business Park
Building Name Cascade View
Address 00000 X.X. Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000
Rentable Sq. Ft 28,650 RSF
RENT; PREPAID RENT; SECURITY DEPOSIT (See Section 5 and 6)
BASE MONTHLY RENT
Month 1-2 $0.00/Month (See Section 1A.7)
Months 3-36 $44,178.00/Month
Months 37-60 $48,161.00/Month
Months 61-84 $51,054.00/Month
Months 85-120 $55,638.00/Month
Prepaid Rent $44,178.00 for Month 3 (See Section 1A.6)
Security Deposit $44,178.00 (See Section 1A.6)
TERM (See Section 3)
Commencement Date June 19, 2000
Rent Commencement Date June 19, 2000
Expiration Date June 18, 2010
Length of Term 10 Years
Renewal Option ONE 5-YEAR EXTENSION (See Section 1A.1)
PERMITTED USE (See Section 7)
General Office Use, Including software development, sales and training
SUBLEASING (See Section 17)
Tenant shall have the right to sublease the Premises subject to all of the terms
and conditions of Section 17.
OPERATING EXPENSES (See Section 8)
Tenant's Share 50%
Additional Rent $14,210.00/Month (See Section 1A.6)
PARKING (See Sections 1A.4 AND 24) APPROXIMATELY 114 STALLS
CC&RS (See Sections 8.3.1 AND 23)
Declaration of Protective Covenants, Conditions, Restrictions, Easements &
Agreements for Snoqualmie Ridge Business Park Recorded Under King County
Recording No. 9804301674, as may be amended
BROKERS (See Section 36)
FOR TENANT COLLIERS INTERNATIONAL
FOR LANDLORD THE XXXXXXXXX GROUP
ADDRESSES FOR NOTICES (See Section 29)
Landlord:
(Street Address)
Snoqualmie Ridge Cascade View LLC
c/o The Quadrant Corporation
00000 XX 0xx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Commercial Division
Tel: 000-000-0000
Fax: 000-000-0000.
(Mailing Address)
Snoqualmie Ridge Cascade View LLC
c/o The Quadrant Corporation, Manager
X.X. Xxx 000
Xxxxxxxx, XX 00000
1
Tenant
Great Plains Software O.C., Inc.
0000-00xx Xxxxxx XX
Xxxxx, XX 00000
Attn: General Counsel
Tel: 000-000-0000
Fax: 000-000-0000
2
1A. Special Lease Terms. The following additional Lease terms shall apply. To
the extent of any inconsistency between this Section 1A and the other
provisions of this Lease, this Section 1A shall control.
1A.1 Renewal Option.
1A.1.1 Grant of Renewal Option. Tenant shall have one option to extend
the Term of this Lease for an additional five years ("Renewal
Term"). Such option may be exercised by Tenant only by written
notice of exercise to Landlord given no earlier than 18 months
and no later than six months prior to the expiration of the Term.
1A.1.2 Effect of Exercise. Upon such exercise, the parties shall be
obligated under all the terms and conditions of this Lease
through the Renewal Term, except that (a) Base Monthly Rent at
the commencement of the Renewal Term shall be equal to the higher
of (i) the Base Monthly Rent in the final month of the Term or
(ii) the Fair Market Monthly Rent for the Premises as of 90 days
after Tenant's notice of exercise, and (b) the Base Monthly Rent
starting at the 37th month of the Renewal Term and for the
balance of the Renewal Term shall equal the amount specified in
clause (a) above increased by the higher of (i) nine percent (9%)
or (ii) a percentage increase equal to cumulative percentage
increase, if any, in the CPI (as defined below) between the first
month of the Renewal Term and the 36th month of the Renewal Term.
As used herein, "CPI" shall mean the Consumer Price Index for All
Urban Consumers, All Items Index for the Seattle Everett
metropolitan area, as published by the Bureau of Labor Statistics
of the United States Department of Labor, or, in the event such
index is no longer published, a successor or substitute index
using factors most comparable to such index, appropriately
adjusted. The CPI in effect on the beginning of each year shall
be the CPI published as of December 31 of the prior year
reflecting all price changes through the end of such prior year..
As used herein, the "Fair Market Rent" shall mean the prevailing
fair market monthly rent for comparable space located within two
miles from the I-90 corridor running between Mercer Island,
Washington and Snoqualmie Ridge Business Park (the "Rent
Comparison Area") and shall take into account the Base Monthly
Rent increase during the 37th month of the Renewal Term as
specified above. Upon determination of the Fair Market Rent as
described below, the parties shall execute an amendment to the
Lease memorializing the Base Monthly Rent for the Renewal Term.
1A.1.3 Determination of Rent for Renewal Term.
(a) Within 20 days of Tenant's notice of exercise, Landlord
shall propose a Base Monthly Rent for the extended Term. The
parties shall negotiate in good faith, but if they are
unable to agree upon such Base Monthly Rent by 30 days after
the delivery of Landlord's proposal, then either party may
elect to cause such Base Monthly Rent to be determined by
reference to the appraised Fair Market Rent. Such election
shall be made by such party by notice to the other party,
including in such notice the designation of an appraiser.
The other party may accept such appraiser or designate
another appraiser within ten days of such notice. If it does
not designate another appraiser in such period, it shall be
deemed to have accepted the first appraiser. If a second
appraiser is designated, the two appraisers shall promptly
appoint a third appraiser.
3
(b) Each appraiser shall determine the Fair Market Rent by
reference to all factors deemed appropriate in his or her
professional opinion, and notify the parties within 30 days
of the date of appointment of the last appraiser of such
Fair Market Rent. The Base Monthly Rent for the extended
Term shall be calculated as provided in Section 1A.1.2 with
the Fair Market Rent equaling the amount determined by the
single appraiser or, if there are three appraisers, the mean
average of the two closest Fair Market Rents.
(c) All appraisers under this appraisal provision shall be
independent certified professional MAI appraisers with at
least five years' experience appraising office properties
within the Rent Comparison Area. If there are three
appraisers, each party shall pay for the cost of its
designated appraiser and 50% of the cost of the third
appraiser. If there is only one appraiser, each party shall
pay 50% of the cost of such appraiser.
1A.1.4 Tenant may not exercise its option to renew the Term at any
time in which it is in Default (as defined in Section 18.1). If
Tenant becomes in Default after exercise of its option to extend
the Term but before the commencement of the extended Term,
Landlord may, in addition to its other remedies under this Lease,
elect to terminate such extension by notice in writing to Tenant,
whereupon the Term shall expire without any such extension.
1A.2 Right of First Refusal. Landlord shall grant Tenant the right of first
refusal to lease any previously-unleased first generation space on the
first floor of the Building (the "ROFR Space") in accordance with the
following terms (the "ROFR"):
1A.2.1 Receipt of Offer, Delivery to Tenant. In the event that
Landlord receives an offer to lease ROFR Space in the form of a
proposal or letter of intent or lease ("Offer"), and Landlord has
either determined that it is ready to accept such Offer, or has
accepted such Offer subject to Tenant's rights under this
Agreement, Landlord shall so notify Tenant in writing ("Offer
Notice"). The Offer Notice shall set forth all of the material
terms of the Offer ("Offer Terms"), provided, however, in no
event shall Landlord have any obligation to disclose the identity
of the prospective tenant.
1A.2.2 Exercise of ROFR. Tenant shall have the right to elect to lease
the ROFR Space identified in the Offer Notice which right must be
exercised if at all by written notice ("ROFR Exercise Notice")
from Tenant received by Landlord on or before the expiration of
ten (10) business days after Tenant's receipt of the Offer
Notice.
1A.2.3 Effect of Non-Exercise of ROFR. If Tenant does not timely
deliver an ROFR Exercise Notice in accordance with Section
1A.2.2, Landlord shall be free to lease the ROFR Space on the
Offer Terms, free and clear of the ROFR, but subject to Section 1
A.2.4.
1A.2.4 Changes in Offer Terms. In the event of any material changes in
the Offer Terms prior to execution of a written lease pursuant to
the Offer, Landlord shall give written notice thereof to Tenant
("Change Notice"). The Change Notice shall identify all of the
revised Offer Terms. Tenant shall have the right to elect to
lease the ROFR Space, which right must be exercised if at all by
ROFR Exercise Notice from Tenant received by Landlord on or
before the expiration of three business days after Tenant's
receipt of the Change Notice. If Tenant does not
4
timely deliver a ROFR Exercise Notice in accordance with this
Section 1A.2.4, Landlord shall be free to lease the ROFR Space on
the revised Offer Terms, free and clear of the ROFR, but subject
to this Section 1A.2.4 in the event of further material changes
in the Offer Terms. For purposes of this Section 1A.2.4,
"material changes" shall include substantial economic changes,
including, without limitation, a change in the amount of the
Monthly Base Rent by more than $.50 per RSF from that specified
in the Offer Terms or a reduction of the proposed term of 2 years
or more from that term specified in the Offer Terms.
1A.2.5 Effect of Exercise. If Tenant exercises the ROFR by delivering
the ROFR Exercise Notice to Landlord in strict accordance with
Section 1A.2.2 or 1A.2.4, as the case may be, Tenant shall be
absolutely and unconditionally bound to lease the ROFR Space on
the Offer Terms and in accordance with the provisions of this
Lease (except that to the extent that the Offer Terms and the
Lease conflict, the Offer Terms shall govern with respect to the
ROFR Space) and the Lease shall be modified to reflect the Offer
Terms. Within ten business days of the ROFR Exercise Notice,
Landlord and Tenant shall enter into a written amendment to this
Lease adding the ROFR Space to the Premises and reflecting the
applicable modifications to the Lease described above.
1A.2.6 Prior' Rights to ROFR Space. Tenant acknowledges that Landlord
as of the date hereof may have entered into a lease or is
currently negotiating a lease for the balance of first generation
space in the Building with a prospective tenant ("Prospective
First Floor Tenant") and any space on the first floor of the
Building that is subject to such lease or lease negotiations with
such Prospective First Floor Tenant shall not be subject to the
ROFR.
1A.3 Normal Business Hours. Normal hours of operation for the Building are
Monday through Fridays from 7:00 a.m. to 6:00 p.m. and Saturdays from
8:00 a.m. to 12:00 p.m., but excluding those days that are nationally
recognized holidays (the "Normal Business Hours"). Tenant shall have
access to the Premises 24 hours per day, seven days per week, every
day of the year.
1A.4 Parking. All parking provided to Tenant shall be available and
accessible on a non-reserved basis, twenty-four (24) hours per day,
seven (7) days week, every day of the year.
1A.5 Signage.
1A.5.1 Building Exterior Signage. Tenant shall be entitled to mount
one sign on the exterior portion of the Building, subject to the
following:
(a) The location, design and construction of the signage meets
all business park and municipal requirements;
(b) The design, permitting, manufacture, installation and
maintenance of such signage shall be at Tenant's sole cost
and expense; and
(c) Tenant's signage meets with Landlord's approval, which shall
not be unreasonably withheld or delayed.
5
1A.5.2 Interior Signage. Landlord shall provide Business Park standard
suite and directory signage.
1A.6 Security Deposit/Prepaid Rent. Tenant covenants that it shall deliver
to Landlord in cash or other immediately available funds the Security
Deposit and Prepaid Rent specified in Section 1 (collectively,
"Deposit") by no later than June 1, 2000 or the date of Tenant's
occupancy of the Premises, whichever date is earlier. Tenant's failure
to timely deliver the Deposit to Landlord in accordance with this
Section 1A.6 shall constitute a Default (as defined in Section 18.1
below).
1A.7 Free Rent Period. Tenant shall have no obligation to pay Base Monthly
Rent during the first two months of the Term ("Free Rent Period").
Tenant shall remain responsible for paying any and all Additional Rent
due under the Lease during the Free Rent Period.
1A.8 Tenant's Right to Audit Annual Reconciliations. Tenant shall have the
right, for a period of 90 days following receipt of Landlord's annual
reconciliation of Operating Expenses under Section 8.5, and upon 30
days prior written notice to Landlord, to examine and conduct an audit
of, at the main accounting offices of Landlord or its property
manager, the books and records of Landlord pertaining solely to the
Operating Expenses for the calendar year covered in such written
statement. Such audit shall be conducted by an independent certified
accounting firm retained by Tenant that is reasonably acceptable to
Landlord. Tenant shall deliver a copy of the audit and supporting
calculations to Landlord within 30 days after completion of the audit,
which audit determination shall be binding on the parties. If Tenant's
audit reveals an overpayment by Tenant greater than 5% of the amount
determined by Landlord, Landlord shall promptly reimburse Tenant for
such overpayment and shall bear all costs and expenses for Tenant's
audit. If the audit reveals an overpayment of 5% or less than the
amount determined by Landlord, then Tenant shall bear all costs and
expenses for such audit and Tenant shall receive a credit against its
next payable Rent in the amount of such overpayment, or such amount
shall otherwise be refunded to Tenant as Landlord determines in its
sole discretion.
1A.9 Landlord's Right to Relocate HVAC Air Shaft. Tenant acknowledges that
Landlord may construct the HVAC air shaft for the Building in a
particular location to accommodate the special requirements of the
Prospective First Floor Tenant. If, at any time, Landlord needs to
relocate the HVAC air shaft to accommodate the needs of a different
tenant on the first floor of the Building, Landlord reserves the right
to enter the Premises and relocate such HVAC shaft; provided that such
relocation shall be performed at Landlord's cost and expense and
Landlord shall use reasonable efforts to minimize any disruption to
the Tenant's use of the Premises during the period of such relocation.
1A.10 Designation of Restrooms as Part of Premises or Common Areas. Tenant
acknowledges that the parties had originally intended that all of the
restrooms in the Building be part of the Common Areas, in which case
Landlord would clean and maintain such restrooms as part of its Common
Area maintenance obligations under Section 9.1.. If, however, Landlord
enters into a lease with the Prospective First Floor Tenant, the first
floor restrooms will become part of the Prospective First Floor
Tenant's premises and the second floor restrooms will become part of
the Premises. In such case, neither the Rentable Square Footage of the
Premises, the Base Monthly Rent nor Tenant's Share will be adjusted,
and Landlord will clean and maintain the second floor restrooms as
part of the janitorial services that Landlord will provide the
Premises pursuant to Section 11.1. In either case, the costs and
expenses of cleaning and maintaining the restrooms shall constitute an
Operating Expense under Section 8.3.
6
2. Premises. Landlord agrees to lease to Tenant and Tenant agrees to lease
from Landlord the Premises described on Exhibit A-1 and consisting of
approximately the square feet designated in Section 1. The Premises are a
part of the Building, located on the real property described on Exhibit A-2
("Property"). The Premises, Building, and Property are part of a business
park described on Exhibit A-3 ("Business Park").
3. Term.
3.1 Commence. The term of this Lease ("Term") shall commence on the
Commencement Date set forth in Section 1, subject to Section 4.
3.2 Expire. The Term shall expire on the Expiration Date set forth in
Section 1, unless sooner terminated or extended as provided in this
Lease.
4. Tenant Improvements; Early Possession; Delayed Delivery of Possession.
4.1 Tenant Improvements. Any improvements to or construction on the
Premises shall be carried out in accordance with the Work Letter
attached as Exhibit B.
4.2 Early Occupancy. If Landlord permits Tenant to occupy the Premises
prior to the Commencement Date set forth in Section 1, the
Commencement Date and Rent Commencement Date shall be such date of
occupancy. Tenant's occupancy prior to the originally scheduled
Commencement Date shall be subject to all the provisions of this Lease
and shall not advance the Expiration Date.
4.3 Landlord Delay. If Landlord for any reason cannot deliver possession
of the Premises to Tenant at the Commencement Date, (i) the
Commencement Date shall be the date on which possession of the
Premises is delivered to Tenant, (ii) this Lease shall not be void or
voidable, nor shall Landlord be liable to Tenant for any loss or
damage resulting therefrom except as set forth in this Section, (iii)
the Rent Commencement Date shall be delayed to the same extent as the
delay in the Commencement Date, except as provided in Section 4.4, and
(iv) the Expiration Date shall be adjusted so that the length of the
Lease Term remains as provided in Section 1, which shall be confirmed
by Landlord's written notice to Tenant setting forth the adjusted
Commencement Date, Rent Commencement Date and Expiration Date. If
Landlord is unable to deliver possession of the Premises to Tenant by
August 19, 2000 for any reason other than Tenant Delay or Force
Majeure (each as defined in the Work Letter), then in addition to
extension of the Commencement Date, Rent Commencement Date and
Expiration Date, Landlord shall pay Tenant $100 for each day that
delivery of possession is delayed beyond August 19, 2000.
4.4 Tenant Delay. If Tenant Delay (as defined in the Work Letter) causes
any delay in Landlord's completion of the Premises, and thereby delays
Tenant's occupancy of the Premises beyond the Commencement Date set
forth in Section 1, then Tenant shall commence payment of Rent on the
Rent Commencement Date set forth in Section 1, and in such case the
timing of the increases in Base Monthly Rent, as set forth in Section
1, shall be based upon the Rent Commencement Date rather than the
Commencement Date.
5. Rent.
5.1 Rent. Tenant shall pay to Landlord the Base Monthly Rent specified in
Section 1 and the Additional Rent as set forth in Section 8 and
elsewhere in this Lease (the Base Monthly
7
Rent and the Additional Rent are collectively referred to as "Rent").
Rent shall be paid in advance, on or before the first day of each
calendar month of the Lease Term.
5.2 Manner of Payment. Rent shall be paid without prior notice, demand,
set off, counterclaim, deduction or defense and, except as otherwise
expressly provided in this Lease, without abatement or suspension. All
Rent shall be paid to Landlord at the address for notices set forth in
Section 1, in lawful money of the United States of America, or to such
other person or at such other place as Landlord may from time to time
designate in writing;
5.3 Rent Commencement. Payment of Rent shall begin on the Rent
Commencement Date set forth in Section 1, subject to Section 1A.7 and
Section 4. Rent for any period during the Lease term that is for less
than one month shall be prorated for the actual number of days in such
period.
6. Prepaid Rent and Security Deposit.
6.1 Deposit. [Intentionally deleted. See Section 1A.6.]
6.2 Use of Deposit to Cure. Landlord shall have the right to all or any
part of the Deposit to cure any Default by Tenant under this Lease or
to compensate Landlord for any damage sustained by it resulting from
such Default. In the event of any such application of the Deposit,
Tenant shall, on demand, immediately pay to Landlord the amount
necessary to replenish the Deposit to the amount set forth in Section
1.
6.3 Return of Security Deposit. If Tenant is not in Default at the
expiration or termination of this Lease, Landlord shall return the
remaining Security Deposit to Tenant, less any amounts necessary to
return the Premises to their original condition, reasonable wear and
tear and those alterations not required by Landlord to be removed by
Tenant under Section 13.1 excepted.
6.4 Treatment as Security Deposit. In the event this Lease is terminated
before the end of the Term for any reason, any Rent paid for any
period after the date of such termination shall be treated as an
addition to the Security Deposit.
6.5 Landlord's Obligation Regarding Deposit. Landlord's obligations with
respect to the Security Deposit are those of a debtor and not a
trustee. Landlord may maintain the security deposit separate from
Landlord's general funds or may commingle the Security Deposit with
other funds of Landlord. No interest shall accrue for Tenant on the
Deposit.
7. Use of Premises.
7.1 Use. Tenant shall use the Premises only for the purpose set forth in
Section 1. The Premises may not be used for any other purpose without
Landlord's written consent. Landlord represents to Tenant that the
purpose set forth in Section 1 is permitted as of the date hereof
under the applicable laws, regulations and codes governing zoning,
land use and similar matters affecting the Building and the Property
(collectively, the "Zoning Laws"). Any changes in the Zoning Laws or
any changes in Tenant's use of the Premises that are not permitted
under the Zoning Laws will not be a basis for terminating this Lease,
for abating or offsetting Rent or for otherwise seeking damages.
7.2 Prohibited Uses. Tenant shall not do or permit anything to be done in
or about the Premises or bring or keep anything therein which will in
any way increase the cost of or affect any fire or other insurance
upon the Building or any part thereof or any of its
8
contents, or cause cancellation of any insurance policy covering the
Building or any part thereof or any of its contents.
7.3 No Nuisance. Tenant shall not do or permit anything to be done in or
about the Premises that will obstruct or interfere with the rights of
other tenants or occupants of the Building or Business Park or injure
them or their property, or use or allow the Premises to be used for
any unlawful purpose or in any way constituting a nuisance. Tenant
shall not, without the prior written consent of Landlord, use any
apparatus, machinery or device in or about the Premises which will
cause any substantial noise or vibration. Tenant shall not place any
boxes, cartons or other rubbish in the corridors or other Common Areas
(defined in Section 10), Building, Property or Business Park. Tenant
shall use due care in the use of the Premises and of the Common Areas
(defined in Section 10), Building Property or Business Park, and shall
not neglect or misuse water fixtures, electric lights and heating and
air-conditioning apparatus.
7.4 Telecommunications Providers. Tenant acknowledges that any provision
of telecommunications, data transmission and office automation
services, equipment and systems by a third party provider, its agents,
affiliates and successors, that has a right, whether exclusive or not,
to provide such services to the Premises, Building or Business Park
(each a "Provider") is entirely separate and distinct from this Lease
and that Landlord has no duty of performance concerning the provision
of services by a Provider. Tenant hereby agrees to look solely to the
Provider for any failure in the provision of services provided by such
Provider.
8. Additional Rent for Operating Expenses.
8.1 Tenant Payment. Tenant shall pay, as Additional Rent, Tenant's Share,
as set forth in Section 1, of all Operating Expenses. Tenant's payment
of Additional Rent shall be made in the same manner as Base Monthly
Rent.
8.2 Tenant's Share. Tenant's Share shall be the percentage of all
Operating Expenses for the Building set forth in Section 1 as
determined by Landlord, based upon the percentage that the approximate
rentable area of the Premises set forth in Section 1 bears to the
approximate rentable area of the Building.
8.3 Definitions.
8.3.1 Definition of Operating Expenses. "Operating Expenses" means all
expenses and charges incurred by Landlord in the operation of the
Building, Property and Common Areas (as defined in Section 10),
as a first-class facility, including without limitation the
following costs by way of illustration: (i) all real property
taxes, assessments and other general or special charges levied
during the Term by any public, governmental or quasi governmental
authority against the real or personal property included in the
Building or the Property, including without limitation Landlord's
personal property used in the maintenance, repair or operation of
the Building or the Property, or any other tax on the leasing of
the Building or on the rents from the Building (other than any
federal, state or local income or franchise tax); (ii) any and
all assessments Landlord must pay for the Building or Property
pursuant to the CC&Rs specified in Section 1, transportation or
any other improvement monitoring or management plan, or any other
covenant, condition or reciprocal easement agreements; (iii)
electricity, gas and similar energy sources, refuse collection,
water, sewer and other utilities services for the Building and
the Property; provided, however, to the extent that any such
services are separately metered to Tenant, Tenant shall pay the
actual separately
9
incurred charges; (iv) annual inspection fees, property
management fees paid to independent or affiliated contractors or
to Landlord, and legal, accounting and other professional
expenses; (v) janitorial, cleaning, window washing and refuse
removal; (vi) all costs of improvements or alterations to the
Building, Property and Common Areas required by Laws, to save
labor, or reduce Operating Expenses; (vii) all premiums and
deductibles for liability, property damage, casualty, automobile,
garage keeper's, rental loss, compensation or other insurance
maintained by Landlord for the Building or Property; (viii) the
cost of any capital improvements made to the Property, Building
or Common Areas by Landlord for the replacement of any Building
equipment needed to operate the Building or the Common Areas at
the same quality levels as prior to the replacement; (ix) air
conditioning, heating, ventilating, plumbing, electrical systems,
elevator maintenance supplies, materials, equipment and tools;
(x) the repair of the air conditioning, heating, ventilating,
plumbing, electrical systems and elevators of the Building; (xi)
maintenance costs, including reasonable payroll expenses, rental
of personal property used in maintenance and all other upkeep of
parking and Common Areas, including cleaning, snow and ice
removal, landscaping and lighting; (xii) costs and expenses of
repairs, resurfacing, repainting, and similar items, including
appropriate reserves, (xiii) costs and expenses associated with
security and monitoring; (xiv) reasonable costs incurred in the
management of the Building and Property (including supplies,
reasonable wages and salaries of employees used in the
management, operation and maintenance thereof and payroll taxes
and similar governmental charges with respect thereto, and
Building management office rental, if any; (xv) all license and
permit fees; (xvi) any other expense or charge whether or not
described above that in accordance with generally accepted
accounting and management practices is properly an expense of
maintaining, operating or repairing the Building, Property or
Common Areas. Operating Expenses shall not include depreciation
on the Building or equipment therein, Landlord's executive
salaries, real estate brokers' commissions, and costs or expenses
for which Landlord is reimbursed or indemnified, by an insurer,
condemnor, tenant or otherwise. Landlord shall not collect more
than 100% of Operating Expenses and shall not recover any item of
cost more than once. If, in Landlord's reasonable determination,
certain Operating Expenses vary in direct relationship to
occupancy of the Building, Tenant's Share of such Operating
Expenses shall be adjusted to reflect that portion of the whole
which the rentable square feet of the Premises bears to the
rentable square footage of the Building, as applicable, which is
actually occupied by tenants.
8.3.2 Definition and Treatment of Capital Improvements. As used
herein, Capital Improvement shall mean the replacement of any
major component or element of the Building or Common Areas, the
cost of which exceeds $10,000. The cost of any Capital
Improvement included in Operating Expenses pursuant to this Lease
shall be amortized over the useful life of the Capital
Improvement with interest accruing on the unamortized balance at
the prime rate then in effect at the Xxxxxxx Xxxx Xxxxxx xx Xxxx
xx Xxxxxxx d/b/a Seafirst Bank or its successors, or such higher
rate as may have been paid by Landlord on funds borrowed for the
purpose of paying for such Capital Improvement. Subject to
Section 12.3, Landlord shall be responsible at its sole cost and
expense for Capital Improvements related to the repair or
replacement of the structural portions of the Building, which
structural portions consist of the foundation, bearing and
exterior walls, subflooring, and roof structure and the cost of
such Capital improvements shall not be included in Operating
Expenses.
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8.4 Determination of Operating Expenses. Prior to each January 1 of the
Term, Landlord shall furnish Tenant a written statement of the
estimated monthly Tenant's Share of Operating Expenses for the coming
calendar year. The estimated monthly Tenant's Share of Operating
Expenses for the period before the first January 1 after the
Commencement Date is set forth in Section 1. Landlord may, by written
notice to Tenant, revise its estimate of Tenant's Share of Operating
Expenses from time to time.
8.5 Reconciliation. Within 90 days after each January 1 during the Term,
or as soon thereafter as practicable, Landlord shall deliver to Tenant
a written statement setting forth the actual Operating Expenses and
Tenant's Share thereof during the preceding calendar year (or portion
of such calendar year after the Commencement Date). To the extent
Tenant's Share of such actual Operating Expenses exceeded the
estimated Tenant's Share thereof paid by Tenant, Tenant shall pay
Additional Rent to Landlord within 30 days after receipt of such
statement by Tenant. To the extent Tenant's Share of such actual
Operating Expenses was less than the estimated Tenant's Share thereof
paid by Tenant, Tenant shall receive a credit against its next payable
Rent or such amount shall otherwise be refunded to Tenant as Landlord
determines in its sole discretion.
8.6 Upon Lease Termination. If this Lease shall expire or otherwise
terminate other than on a December 31, Landlord may in its discretion
make a special determination of Tenant's Share of actual Operating
Expenses for the partial calendar year ending on the date of such
expiration or other termination, or may defer such determination until
its usual reconciliation of Operating Expenses for the Building for
the entire calendar year. The excess actual Tenant's Share for such
partial calendar year shall be paid to Landlord, or the excess
estimated Tenant's Share already paid by Tenant, as the case may be,
shall be paid by Tenant to Landlord or Landlord to Tenant, as the case
may be, within 30 days of such determination.
8.7 Landlord Rights. Landlord shall have the same rights with respect to
Tenant's nonpayment of Tenant's Share of Operating Expenses as
required under this Lease as it has with respect to any other
nonpayment of Rent under this Lease.
9. Maintenance and Repair Responsibility.
9.1 Premises Maintenance Obligations. Subject to Section 7.3, 12.3 and 15,
Landlord shall maintain and keep in good condition and repair
throughout the Term the entire Premises, the Building, and the Common
Areas in a manner and at a level of quality that is consistent with
comparable buildings in the area (the "Maintenance Obligations").
Except as otherwise expressly provided in this Lease, all cost and
expenses incurred by Landlord in performing the Maintenance
Obligations shall be considered Operating Expenses.
9.2 No Obligation For Alteration. Except as specifically provided
elsewhere in this Lease, Landlord shall have no obligation whatsoever
to alter, remodel, improve, repair, decorate, or paint the Premises or
any part thereof. Tenant affirms that Landlord has made no
representations to Tenant about the condition of the Premises or the
Building, except as specifically herein set forth.
9.3 Tenant Waiver. Tenant waives the right to make repairs at Landlord's
expense under any law, statute, or ordinance now or hereafter in
effect.
10. Common Areas.
10.1 Use of Common Areas. Provided Tenant is not in Default under the Lease
and subject to the other terms and conditions of this Lease, Tenant
shall have the right to use the
11
Common Areas on a non-exclusive basis with Landlord, other tenants in
the Building and the Business Park and their respective officers,
employees, guests, invitees and agents. Landlord shall have the right
to establish and enforce reasonable rules and regulations applicable
to all tenants concerning the maintenance, management, use, and
operation of the Common Areas; and to make changes to the Common
Areas, including without limitation changes in the location of
lobbies, driveways, entrances, exits, vehicular parking spaces,
parking areas, pedestrian and bicycle trail areas, or the direction of
the flow of traffic.
10.2 Definition of Common Areas. In this Lease, "Common Areas," means all
parts of the Building and related land areas and facilities outside
the Premises and the premises leased or available for lease to other
tenants, but constituting a part of Business Park. Common Areas
include, without limitation:
10.2.1 the Building's common entrances, lobbies, all restrooms in the
Building other than those located within a tenant's premises,
elevators, stairway and accessways, loading docks, ramps, drives
and platforms and any passageways and serviceways thereto, and
mechanical and electrical systems for the Building, including
without limitation, plumbing, sewage, electrical systems, pipes
conduits, wires and appurtenant equipment of the Building, all to
the extent serving the Premises;
10.2.2 the open areas, landscaped areas, sidewalks, pedestrian
walkways and patios, roadways, pedestrian and bicycle trails,
driveways, parking areas, utility systems and facilities, service
areas, refuse areas and all other areas in the Business Park and
available for use in common with all tenants, guests and invitees
of the Business Park, located outside the Premises and the
premises leased or available for lease to other tenants in the
Business Park.
11. Utilities and Services.
11.1 Furnishing of Utilities and Services. Provided that Tenant is not in
Default under this Lease, Landlord shall cause to be furnished to the
Premises the following utilities and services, during Normal Business
Hours: (i) electricity for normal lighting and office machines, (ii)
heat and air conditioning required for the comfortable use and
occupation of the Premises, and (iii) janitorial services at the same
level and frequency of service as is standard for other comparable
buildings in the area, for which janitorial services Landlord shall
contract with a third party service provider and the cost of which
janitorial services shall be charged to Tenant as Additional Rent.
Landlord shall provide HVAC service to the file server and computer
lab 24 hours per day, seven days per week, which will require a
installation and operation of a special HVAC system. The added cost of
maintaining and operating such special HVAC system shall be paid by
Tenant to Landlord as Additional Rent. The services described in this
Section are, collectively, the "Service Obligations."
11.2 Additional Services. The provision and use of such utilities and
services shall be in accordance with any applicable rules and
regulations under this Lease. If Tenant requires or utilizes more
water or electrical power than is considered reasonable or normal by
Landlord, Landlord may at its option require Tenant to pay, as
Additional Rent, the cost, as fairly determined by Landlord, incurred
in such extraordinary usage. In addition, Landlord may install
separate meters in accordance with Section 11.4.
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11.3 After Hours. At Tenant's request, Landlord shall furnish, at Tenant's
expense, heat and air conditioning outside of Normal Business Hours,
at rates to be established from time to time by Landlord, and to be
paid by Tenant as billed by Landlord.
11.4 Separate Meters. To the extent that the Premises are separately
metered or sub-metered for Tenant's use of any utilities or services,
Tenant shall pay for such use in the same manner as Rent, or shall pay
the cost thereof directly to the service provider, and in either event
such charges shall constitute Additional Rent hereunder.
11.5 Failure. In the event of any failure or interruption of such utilities
and services, Landlord shall diligently attempt to resume service
promptly. Tenant shall not be entitled to any abatement or reduction
of Rent by reason of any failure or interruption of utilities or
services, no eviction of Tenant shall result from any such failure or
interruption, and Tenant shall not be relieved from the performance of
any obligation in this Lease because of such failure or interruption.
12. Limits on Landlord's Liability. Landlord's liability in respect of its
Maintenance and Service Obligations is subject to the following
limitations:
12.1 Circumstances Beyond Control. Landlord shall not be liable for any
failure of Maintenance Obligations or Service Obligations when such
failure is caused by (i) strikes, lockouts or other labor disturbance
or labor dispute of any character, (ii) governmental regulation,
moratorium or other governmental action, (iii) inability despite the
exercise of reasonable diligence to obtain electricity, water or fuel
from the providers thereof, (iv) acts of God or (v) any other cause
beyond Landlord's reasonable control.
12.2 Unreasonable Period of Failure. Subject to Section 12.1, Landlord
shall not be liable for any failure of Maintenance Obligations or
Service Obligations, unless such failure shall persist for an
unreasonable time after written notice of the need of such repairs or
maintenance or of the interruption of services is given to Landlord by
Tenant.
12.3 Tenant Caused. If maintenance and repairs to the Premises, Building or
Common Areas are caused in part or in whole by the act, neglect,
fault, or omission of any duty by Tenant, its agents, servants,
employees, or invitees, Tenant shall pay to Landlord the costs of such
maintenance and repairs.
12.4 No Abatement of Rent. Except as specifically provided in Sections 15
and 16, there shall be no abatement of Rent in any circumstance under
this Lease.
12.5 No Interference. Landlord shall not be liable for 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
Building, the Premises, the Property, or the Common Areas, or to
fixtures, appurtenances, and equipment therein, or the failure of
Maintenance. Obligations or Service Obligations. Without limiting the
generality of this Section 12, in no event shall Landlord have any
liability for consequential damages resulting from any act or omission
of Landlord in respect of its Maintenance Obligations or Service
Obligations, even if Landlord has been advised of the possibility of
such consequential damages.
13. Alterations and Additions by Tenant; Liens and Insolvency.
13.1 Alterations and Additions by Tenant. With the prior written consent of
Landlord, Tenant may make at its expense additional improvements or
alterations to the Premises. Any repairs or new construction by Tenant
shall be done in conformity with plans and specifications approved by
Landlord, by contractors approved by Landlord, (provided, that
13
Landlord may require that such work be performed by Landlord's
employees or contractor(s) employed by Landlord so long as the cost of
such work is no more than 5% higher than any construction bid which is
acceptable to Tenant) and subject to Landlord's reasonable rules and
regulations regarding such construction. All work performed shall be
done lien-free in a workmanlike manner and shall become the property
of Landlord. Landlord may require that Tenant provide to Landlord, at
Tenant's expense, a lien and completion bond in an amount equal to
150% of the estimated cost of any improvements, additions, or
alterations in the Premises. Landlord shall not unreasonably withhold
or delay its consent to Tenant's proposed alterations or improvements
if the conditions of this Section 13 are satisfied. Landlord may
require Tenant to remove any improvements or alterations at the
expiration or termination of the Term, provided that Landlord notifies
Tenant, at the time Landlord, grants consent, that such alterations or
improvements must be removed at the expiration or termination of the
Term, such removal to occur at Tenant's expense; and Tenant shall
repair all damage to the Premises or Building occurring as a result of
such removal. In the event Tenant fails to remove any improvements or
alterations as required by Landlord or repair any damage occurring
during such removal, Landlord shall be entitled to remove any
improvements or alterations or make such repairs, at Tenant's expense,
and shall further be entitled to draw upon the Deposit
13.2 Liens and Insolvency. Tenant shall keep the Premises, Building and
Property free from any liens arising out of any work performed,
materials ordered or obligations incurred by Tenant. Landlord shall
have the right at all reasonable times to post on the Premises any
notices which it deems necessary for its protection from such liens.
If such liens are filed unless such liens are removed or bonded around
to Landlord's satisfaction within fourteen (14) days of Landlord's
notice to Tenant, Landlord may, without waiving its rights and
remedies based on such breach by Tenant and without releasing Tenant
from any of its obligations hereunder, cause such liens to be released
by any means it shall deem proper, including payment in satisfaction
of the claim giving rise to such lien. Tenant shall pay to Landlord on
demand, any reasonable sum paid by Landlord to remove such liens,
together with interest at the rate specified in Section 33.8.
14. Insurance; Indemnity.
14.1 Tenant Waiver. Landlord shall not be liable to Tenant, and Tenant
hereby waives all claims against Landlord, for injury or damage to any
person or property in or about the Premises, Building, Property or
Common Areas by or from any cause whatsoever, including without
limitation any acts or omissions of any other tenants, licensees or
invitees of the Building.
14.2 Indemnity. Tenant shall indemnify and defend (using legal counsel
acceptable to Landlord) Landlord and hold Landlord harmless, from and
against any and all loss, cost, damage, liability and expense
(including reasonable attorneys' fees) whatsoever that may arise out
of or in connection with Tenant's occupation, use or improvement of
the Premises, or that of its employees, agents or contractors, or
Tenant's breach of its obligations under this Lease. To the extent
necessary to fully indemnify Landlord from claims made by Tenant or
its employees, this indemnify constitutes a waiver of Tenant's
immunity under the Washington Industrial Insurance Act, RCW Title 51.
This indemnity shall survive the expiration or termination of the
Term.
14.3 Landlord's Responsibility. The exculpation, release and indemnity
provisions of Sections 14.1 and 14.2 shall not apply to the extent the
subject claims thereunder were caused by Landlord's gross negligence
or willful misconduct. However, in no event shall Landlord be liable
to Tenant for consequential damages.
14
14.4 Tenant's Insurance. Tenant shall procure and maintain throughout the
Term at Tenant's expense, the following insurance:
14.4.1 Comprehensive general public liability insurance, insuring
Tenant against liability arising out of the Lease and the use,
occupancy, or maintenance of the Premises and all areas
appurtenant thereto. Such insurance shall be in the amount of not
less than $3,000,000 combined single limit for injury to or death
of one or more persons in an occurrence, and for damage to
tangible property (including loss of use) in an occurrence (or in
such amount as Landlord determines in its reasonable discretion).
Such policy shall insure the operations of independent
contractors and contractual liability (covering the indemnity in
Section 14.2) and shall: (i) name Landlord as an additional
insured, and (ii) provide that it is primary and noncontributing
with any insurance in force or on behalf of Landlord.
14.4.2 Standard form property insurance insuring against the perils of
fire, extended coverage, vandalism, malicious mischief, special
extended coverage ("All-Risk") and sprinkler leakage. This
insurance policy shall be upon all personal property for which
Tenant is legally liable or that was installed at Tenant's
expense, and that is located in the Building or Premises,
including without limitation all Tenant's furnishings, fixtures,
furniture, fittings, and equipment and all improvements to the
Premises installed by Tenant, in an amount not less than 90% of
the full replacement cost thereof. In the event of a dispute as
to the amount of full replacement cost, the decision of Landlord
or any mortgagees of Landlord shall be conclusive. Such policy
shall also include business interruption coverage, covering
direct and indirect loss of Tenants earnings attributable to
Tenant's inability to use fully or obtain access to the Premises
or Building, in an amount as will properly reimburse Tenant. Such
policy shall name Landlord and any mortgagees of Landlord as
insured parties, as their respective interests may appear.
14.4.3 Xxxxxxx'x Compensation and Employer's Liability Insurance (as
required by state law).
14.4.4 Any other form or forms of insurance as Tenant or Landlord or
any mortgagees of Landlord may reasonably require from time to
time in form, in amounts and for insurance risks against which a
prudent tenant would protect itself.
14.5 Policies. All policies of insurance to be obtained by Tenant hereunder
shall be in a form satisfactory to Landlord and shall be issued by
insurance companies holding a General Policyholder Rating of "A" and a
Financial Rating of "X" or better in the most current issue of Best's
Insurance Guide. Tenant shall provide Landlord with certificates of
such insurance. No such policy shall be cancelable or reducible in
coverage except after 30 days' prior written notice to Landlord.
Tenant shall, within ten days prior to the expiration of such
policies, furnish Landlord with renewals or "binders" thereof, or
Landlord may order such insurance and charge the cost thereof to
Tenant as Additional Rent.
14.6 Landlord's Insurance. Landlord shall maintain liability and casualty
insurance for the Building and Property adequate in Landlord's
judgment to cover (with deductibles deemed appropriate by Landlord)
the risks customarily insured against by owners of properties similar
to the Building.
14.7 Proceeds. The proceeds of any insurance policies maintained by or for
the benefit of Landlord shall belong to and be paid over to Landlord.
Any interest or right of Tenant in any such proceeds shall be subject
to Landlord's interest and right in such proceeds.
15
14.8 Waiver of Subrogation. Anything in this Lease to the contrary
notwithstanding, Tenant and Landlord each waives its entire right of
recovery, claims, actions, or causes of action against the other for
loss or damage to the Premises, Building, or Property or any personal
property of such party therein that is caused by or incident to the
perils covered by normal extended coverage clauses of standard fire
insurance policies carried by the waiving party and in force at the
time of damage or loss. Tenant and Landlord each waives any right of
subrogation it may have against the other party to the extent of
recovery under any such insurance, and shall cause each insurance
policy obtained by it to provide that the insurance company waives all
right to recovery by way of subrogation against the other party in
connection with any such loss or damage. If either Landlord or Tenant
is unable to obtain its insurer's permission to waive any claim
against the other party, such party shall promptly notify the other
party of such inability.
14.9 Notification of Accidents. Tenant shall promptly notify Landlord of
any casualty or accident occurring in or about the Premises.
15. Destruction.
15.1 Election to Restore. If the Premises or the Building is destroyed by
fire, earthquake, or other casualty to the extent that they are
untenantable in whole or in part, then Landlord shall have the right
but not the obligation to proceed with reasonable diligence to rebuild
and restore the Premises or the Building or such part thereof.
Landlord shall within 30 days after such destruction or injury notify
Tenant whether Landlord intends to rebuild. If Landlord fails to
notify Tenant within such period, then this Lease shall terminate as
of the end of such period.
15.2 Rent Abatement. During the period from destruction or damage until
restoration (or termination of this Lease), Rent shall be abated in
the same ratio as that portion of the Premises which Landlord
determines is unfit for occupancy shall bear to the whole Premises. If
damage is due to the fault or neglect of Tenant or its agents,
employees, invitees, or licensees, there shall be no abatement of
Rent.
15.3 Repairs to Tenant Installations. Landlord shall not be required to
repair any injury or damage by fire or other cause, or to make any
repairs or replacements of any panels, decoration, office fixtures,
paintings, floor covering, or any other improvements to the Premises
installed by Tenant. Instead, if Landlord repairs or rebuilds the
Premises under this Section 15, Tenant shall repair or rebuild such
Tenant-installed improvements and other items of property
15.4 No Compensation. Tenant shall not be entitled to any compensation or
damages from Landlord for loss of the use of the whole or any part of
the Premises, the property of Tenant, or any inconvenience or
annoyance occasioned by such damage, repair, reconstruction, or
restoration.
16. Condemnation.
16.1 Termination of Lease. If all or part of the Premises are taken under
power of eminent domain, or sold under the threat of the exercise of
said power, this Lease shall terminate as to the part so taken as of
the date the condemning authority takes possession.
16.2 Election of Termination. If more than 15% of the floor area of
Premises is taken by condemnation, Landlord or Tenant may, by written
notice to the other within ten days after notice of such taking,
terminate this Lease as to the remainder of the Premises as of the
date the condemning authority takes possession.
16
16.3 Reduction of Rent. If Landlord or Tenant does not so terminate, this
Lease shall remain in effect as to such remainder, except that the
Rent shall be reduced in the proportion that the rentable floor area
taken bears to the original rentable total floor area. However, if
circumstances make abatement based on floor area unreasonable, the
Rent shall xxxxx by a reasonable amount to be determined by Landlord.
In the event that neither Landlord nor Tenant elects to terminate this
Lease, Landlord's responsibility to restore the remainder of the
Premises shall be limited to the amount of any condemnation award
allocable to the Premises, as determined by Landlord.
16.4 Award. Any award for the taking of all or part of the Premises under
the power of eminent domain, including payment made under threat of
the exercise of such power, shall be the property of Landlord, whether
made as compensation for diminution in value of the leasehold or for
the taking of the fee or as severance damages. Tenant shall only be
entitled to such compensation as may be separately awarded or
recoverable by Tenant in Tenant's own right for the loss of or damage
to improvements to the Premises installed by Tenant, for Tenant's
trade fixtures and removable personal property and for Tenant's
relocation or moving expenses. Landlord shall not be liable to Tenant
for the loss of the use of all or any part of the Premises taken by
condemnation.
16.5 Landlord Aothoritv. Landlord Shall have the exclusive authority to
grant possession and use to the condemning authority and to negotiate
and settle all issues of just compensation or, in the alternative, to
conduct litigation concerning such issues; provided, however, that
Landlord shall not enter into any settlement of any separate award
that may be made to Tenant as described in Section 16.4 without
Tenant's prior approval of such settlement, which approval shall not
be unreasonably withheld.
17. Assignment and Subletting.
17.1 Landlord Consent Required. Tenant shall not assign this Lease, or
sublet the Premises or any part thereof, either by operation of law or
otherwise, or permit any other party to occupy all or any part of the
Premises, without first obtaining the written consent of Landlord.
Tenant shall propose such assignment or sublease by written notice to
Landlord, and such notice shall specify an effective date. This Lease
shall not be assignable by operation of law. Tenant shall further
provide to Landlord other information and creditworthiness materials
concerning any proposed assignee or sublessee and its proposed use of
the Premises as is requested by Landlord. Landlord shall approve or
disapprove such assignment or sublease within 15 business days of
Landlord's receipt of all such information requested by Landlord.
Landlord's consent to a proposed assignment or sublease shall not be
unreasonably withheld or delayed; provided, however, that Landlord's
rejection of any proposed subtenant or assignee based upon Landlord's
determination, in the exercise of its good faith judgment, that the
proposed subtenant or assignee is not creditworthy, or that use of the
Premises by such proposed subtenant or assignee is inconsistent or
incompatible with the uses then allowed in the Business Park shall not
be deemed to be an unreasonable withholding of Landlord's consent.
Notwithstanding any assignment of this Lease or subletting of the
Premises, Great Plains Software O.C., Inc. shall remain fully liable
for any and all obligations and liabilities of Tenant under this
Lease.
17.2 Deemed Assignment. If Tenant is a corporation, any transfer of this
Lease from Tenant by merger, consolidation, or liquidation, or any
change in the ownership of or power to vote 50% or more of the
outstanding voting stock of Tenant shall constitute an assignment
under this Lease. If Tenant is a partnership or limited liability
company, any change in the identity or majority ownership of partners
or members in Tenant serving as general partner or manager or owning
50% or more of the outstanding economic interests
17
in such entity shall constitute an assignment under this Lease. The
provisions of this Section 17.2 shall not apply if Tenant's stock is
listed on a recognized security exchange or if at least eighty percent
(80%) of its stock is owned by a corporation whose stock is listed on
a recognized security exchange.
17.3 Recapture. In the alternative to consenting to a proposed assignment
or sublease, Landlord shall have the right to recapture the Premises,
or applicable portion thereof. Landlord may exercise such right by
notice to Tenant within ten business days after receipt of Tenant's
notice. Such recapture shall terminate this Lease as to the applicable
portion of the Premises effective on the effective date proposed in
Tenant's notice.
17.4 Additional Requirements. If Landlord elects not to recapture and
thereafter elects to gives its consent to the proposed assignment or
sublease, (i) Landlord may charge Tenant a reasonable sum to reimburse
Landlord for legal and administrative costs incurred in connection
with such consent; (ii) in the event of a sublease, Landlord and
Tenant shall share equally in any rent and other proceeds paid to
Tenant in excess of the Rent to be paid to Landlord under this Lease,
less any reasonable leasing costs, including but not limited to tenant
improvement costs, leasing commissions and legal fees; and (iii) in
the event of an assignment or a sublease, Tenant shall remain liable
to Landlord for the performance of all of Tenant's obligations under
this Lease.
17.5 Assignment with Bankruptcy. If this Lease is assigned pursuant to the
provisions of the Revised Bankruptcy Act, 11 U.S.C. Section 101 et
seq., any and all consideration paid or payable in connection with
such assignment shall be Landlord's exclusive property and paid or
delivered to Landlord, and shall not constitute the property of tenant
or tenant's estate in bankruptcy. Any person or entity to whom the
Lease is assigned pursuant to the Revised Bankruptcy Act shall, be
deemed automatically to have assumed all of Tenants obligations under
this Lease.
17.6 Sale. In the event of any sale of the Building or Property, or any
assignment of this Lease by Landlord, Landlord shall be relieved of
all liability under this Lease arising out of any act, occurrence, or
omission occurring after sale or assignment; and the purchaser or
assignee at such sale or assignment or any subsequent sale or
assignment of Lease, the Property, or Building, shall be deemed
without any further agreement to have assumed all of the obligations
of the Landlord under this Lease accruing after the date of such sale
or assignment.
17.7 Binding. Subject to the provisions of this Section 17, this Lease
shall be binding upon and inure to the benefit of the parties, their
heirs, successors and assigns.
18. Default
18.1 Definition of Default. The occurrence of any one or more of the
following events shall constitute a material default and breach of the
Lease by Tenant ("Default"):
18.1.1 vacation or abandonment of the entire Premises for 12 or more
consecutive months;
18.1.2 failure by Tenant to make any payment required as and when due,
where such failure shall continue after five days' written notice
from Landlord;
18.1.3 failure by Tenant to observe or perform any of the covenants,
conditions, or provisions of this Lease, other than the making of
any payment, where such failure shall continue after 30 days'
written notice from Landlord; provided,
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however, that if the nature of Tenant's obligation is such that
more than 30 days are required for performance, Tenant shall not
be in default if Tenant commences performance within 30 days
after Landlord's notice and thereafter completes such performance
diligently and within a reasonable time; or
18.1.4 (i) the making by Tenant of any general assignment or general
arrangement for the benefit of creditors; (ii) the filing by or
against Tenant of a petition in bankruptcy, including
reorganization or arrangement, unless, in the case of a petition
filed against Tenant, the same is dismissed within 30 days;
(iii) 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 this Lease; (iv) the seizure by any
department of any government or any officer thereof of the
business or property of Tenant; and (v) adjudication that Tenant
is bankrupt.
18.2 Tenant Notification. Tenant shall notify Landlord promptly of any
Default by Tenant (or event or occurrence which, with the passage of
time, the giving of notice, or both, would become a Default) that by
its nature is not necessarily known to Landlord.
18.3 Landlord Default. Landlord shall be in default if it fails to observe
or perform any of the covenants, conditions, or provisions of this
Lease, where such failure shall continue after 30 days' written notice
from Tenant; provided, however, that if the nature of Landlord's
obligation is such that more than 30 days are required for
performance, Landlord shall not be in default if Landlord commences
performance within 30 days after Tenant's notice and thereafter
completes such performance diligently and within a reasonable time.
Tenant shall copy Landlord's lender with any such notice of default,
if Tenant has been provided with the name and address of any such
lender. In no event shall a default by Landlord under this Lease give
rise to any right of Tenant to terminate this Lease or withhold or
offset the payment of Base Monthly Rent or Additional Rent. The
obligations of Tenant to pay Base Monthly Rent and Additional Rent
shall continue unaffected in all events unless suspended or terminated
pursuant to an express provision of this Lease.
18.4 [Intentionally deleted.]
19. Remedies in Default
19.1 Landlord Remedies. In the event of any Default by Tenant, Landlord
may, at any time without waiving or limiting any other right or
remedy, do any one or more of the following: (i) re-enter and take
possession of the Premises without terminating this Lease, or (ii)
terminate this Lease, and (iii) pursue any remedy allowed by law or
equity.
19.2 Tenant Payment of Costs. Whether Landlord has elected to terminate
this Lease or not, Tenant agrees to pay Landlord the reasonable cost
of recovering possession of the Premises, the expenses of reletting,
and any other costs or damages arising out of Tenants Default,
including without limitation the reasonable costs of removing persons
and property from the Premises, the reasonable costs of preparing or
altering the Premises for reletting, broker's commissions, and
attorneys' fees.
19.3 Termination. In the event Landlord elects to terminate this Lease,
Landlord shall be additionally entitled to recover from Tenant: (i)
the award by a court having jurisdiction thereof of the amount by
which the unpaid rent and other charges and adjustments called for
herein for the balance of the term after the time of such award
exceeds the amount of such loss for the same period that Tenant proves
could be reasonably avoided and (ii) that portion of any leasing
commission and Tenant Improvements costs paid by Landlord applicable
to the unexpired term of the Lease.
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19.4 No Termination. No re-entry or taking possession of the Premises by
Landlord pursuant to this Section 19, or acceptance of Tenant's keys
to or surrender of the Premises shall be construed as an election to
terminate this Lease unless a written notice of such intention is
given to Tenant. Notwithstanding any reentry or termination, the
liability of Tenant for the Rent shall continue for the balance of the
Term, and Tenant shall make good to Landlord any deficiency arising
from reletting the Premises at a lesser rent than the Rent provided
for in this Lease. Tenant shall pay such deficiency each month as the
amount thereof is ascertained by Landlord.
19.5 Landlord Election to Make Tenant Advances. If Tenant shall fail to pay
any sum of money owed to any party other than Landlord, for which
Tenant is liable under this Lease, or if Tenant shall fail to perform
any other act on its part to be performed hereunder, and such failure
continues for a period of ten days after notice thereof by Landlord,
Landlord may, without waiving or releasing Tenant from its obligations
or waiving or releasing any rights that Landlord may have, make any
such payment or perform any other act to be made or performed by
Tenant. All sums so paid by Landlord and all necessary incidental
costs, together with interest thereon at the rate established in
Section 33.8, from the date of such payment by Landlord, shall be
deemed Additional Rent and shall be paid to Landlord on demand.
20. Access. Tenant shall permit Landlord to enter the Premises at all
reasonable times with reasonable advance notice to Tenant (except in case
of emergency, in which case no notice is required) for the purpose of
inspecting, altering, and repairing the Premises and the Building and
ascertaining compliance with the provisions of this Lease by Tenant. The
existence or exercise of such right of access shall not be construed as
imposing any obligation on Landlord to inspect, discover or correct or
repair any condition in the Premises or the Building. Landlord may also
show the Premises to prospective purchasers or tenants at reasonable times,
provided that Landlord shall not materially interfere with Tenant's
business operation.
21. Surrender of Premises: Hold-Over Tenancy.
21.1 Surrender of Premises. Upon the expiration or sooner termination of
this Lease, Tenant shall surrender the Premises and all the additions
and alterations thereto, and leave the Premises broom clean and in
good order and condition and repair, excluding ordinary wear and tear.
21.2 Hold-Over Tenancy. If without execution of a new Lease or written
extension Tenant shall hold over after the expiration or termination
of the Term, with Landlord's written consent. Tenant shall be deemed
to be occupying the Premises as a Tenant from month to month, which
tenancy may be terminated as provided by law, unless the parties agree
otherwise at the time of Landlord's consent. If Tenant shall hold over
after expiration or termination of the Term without Landlord's written
consent, the Base Monthly Rent payable shall be 125% of the Base
Monthly Rent payable in the last month prior to expiration or
termination of the Term, and Tenant shall continue to pay Additional
Rent. During any such tenancy, Tenant shall continue to be bound by
all of the terms, covenants, and conditions of this Lease, insofar as
applicable.
22. Compliance with Law. Tenant shall not use the Premises or permit anything
to be done in or about the Premises which will in any way conflict with any
applicable law, statute, ordinance, or governmental rule or regulation, now
or hereafter in force ("Laws"). Tenant shall at its sole cost and expense
promptly comply with all Laws, including without limitation the Americans
with Disabilities Act, and with the requirements of any board of fire
insurance underwriters or other similar bodies now or hereafter
constituted, relating to, or affecting the use or occupancy of the
Premises. The judgment of any court of competent jurisdiction, or the
admission of Tenant in any
20
action, whether Landlord be a party thereto or not, that Tenant has
violated any Laws, shall be conclusive of the fact as between Landlord and
Tenant.
23. Rules and Regulations. Tenant shall faithfully observe and comply with the
rules and regulations that Landlord shall from time to time promulgate and
with and the CC&Rs and any other restrictive covenants and obligations
created by private contracts which affect the use and operation of the
Premises, Building, Common Areas or Business Park now or hereafter in
force. All such rules and regulations shall be non-discriminatory and
reasonable and shall be uniformly and consistently enforced against all
tenants in the Building. Additions and modifications to rules and
regulations shall be binding on Tenant upon delivery of a copy of them to
Tenant. Landlord shall not be responsible to Tenant for the nonperformance
of any rules or regulations by any other tenants or occupants of the
Building.
24. Parking. Tenant shall have the right to use, on a first-come, first served
basis, in common with other tenants and occupants of the Building, up to
the number of parking stalls specified in Section 1, located on the
Property and which shall be available for use by all tenants of the
Building, their guests and invitees, but which may, at Landlord's election,
be designated by Landlord (which designated parking facilities Landlord may
change at any time and from time to time in its sole discretion), subject
to the rules and regulations and any charges that may be established or
altered for such parking facilities from time to time. Tenant shall comply
with any and all private and governmentally imposed parking restrictions
applicable to the Building or Property, including without limitation, the
requirements of all designations placed on parking stalls located on the
Property, such as car pool, visitor and designation for any tenant of the
Building.
25. Estoppel Certificates. Tenant shall execute, within ten business days
following Landlord's request, a certificate in such reasonable form as may
be required by Landlord or a prospective purchaser, mortgagee or trust deed
beneficiary, or Landlord's successor after a sale or foreclosure,
certifying: (i) the Commencement Date of this Lease, (ii) that the Lease is
unmodified and in full force and effect, (or if there have been
modifications hereto, that this Lease is in full force and effect, and
stating the date and nature of such modifications); (iii) that there have
been no current defaults under this Lease by either Landlord or Tenant
except as specified in Tenant's statement, (iv) the dates to which the Base
Monthly Rent, Additional Rent and other charges have been paid, and (v) any
other information reasonably requested by the requesting party. Such
certificate may be relied upon by Landlord and/or such other requesting
party. Tenant's failure to deliver such statement within such time shall be
conclusive upon Tenant that this Lease is in full force and effect, without
modification except to the extent represented by Landlord, that there are
no uncured defaults in Landlord's performance under this Lease, and that
not more than one month's Rent has been paid in advance. Tenant's failure
to deliver said statement within ten business days of request, shall
constitute Tenant's Default.
26. Subordination. Tenant agrees that this Lease shall be subordinate to the
lien of any mortgage, deeds of trust, or ground leases now or hereafter
placed against the Property or Building, and to all renewals and
modifications, supplements, consolidations, and extensions thereof.
Notwithstanding the foregoing, Landlord reserves the right, however, to
subordinate or cause to be subordinated any such mortgage, deed of trust or
ground lease to this Lease. Upon a foreclosure or conveyance in lieu of
foreclosure under such mortgage or deed of trust, or a termination of such
ground lease, and a demand by Landlord's successor, Tenant shall attorn to
and recognize such successor as Landlord under this Lease; provided,
however, that Landlord shall obtain for the Term of this Lease what is
commonly known as a "nondisturbance" agreement which is intended to protect
Tenant's right to possession under this Lease for so long as Tenant
complies with the terms of this Lease and which shall be in such standard
form and substance as the lender or ground lessor at that time typically
provides to comparable tenants. Landlord shall use reasonable efforts to
obtain modifications to such standard nondisturbance agreements as Tenant
may reasonably request. Tenant shall execute and deliver on request and in
the form
21
requested by Landlord, any instruments reasonably necessary or appropriate
to evidence, effect or confirm such subordination.
27. Removal of Property. On expiration or other termination of this Lease,
Tenant shall remove (i) all personal property of Tenant on the Premises,
including without limitation all Tenant's furnishings, fixtures, furniture,
fittings, cabling, wiring and equipment; and (ii) those improvements to the
Premises installed by or at the expense of Tenant which Landlord previously
notified Tenant in accordance with Section 13.1 would need to be removed
upon expiration or termination of the Lease. All other improvements shall
become the property of Landlord under Section 13. Tenant shall repair or
reimburse Landlord for the cost of repairing any damage to the Premises
resulting from the installation or removal of such property of Tenant. All
property of Tenant remaining on the Premises after reentry or termination
of this Lease shall conclusively be deemed abandoned and may be removed by
Landlord. The cost of removal of such property shall be reimbursed by
Tenant to Landlord upon demand, including, but not limited to court costs,
reasonable attorneys' fees and storage and disposal charges relating to
such property. Landlord may store such property of Tenant in any place
selected by Landlord, including but not limited to a public warehouse, at
the expense and risk of the owner thereof, with the right to sell such
stored property without notice to Tenant. The proceeds of such sale shall
be applied first to the cost of such sale, second to the payment of the
cost of removal and storage, if any, and third to the payment of any other
amounts that may then be due from Tenant to Landlord under this Lease, and
any balance shall be paid to Tenant.
28. Personal Property Taxes. Tenant shall pay prior to delinquency all 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 satisfactory evidence of such payment. "Personal property taxes"
under this Section 2B shall include all property taxes assessed against the
property of Tenant, whether assessed as real or personal property.
29. Notices. All notices under this Lease shall be in writing. Notices shall be
effective (i) three days after being mailed by certified mail, return
receipt requested (ii) when personally delivered, or (iii) when sent by
fax, in each case to the address or fax number of the receiving party set
forth in Section 1. Either party may change its address and fax number for
notices by notice to the other from time to time.
30. Condition of Premises. Subject to the punch list items identified in the
Work Letter, by taking possession of the Premises, Tenant accepts the
Premises as being in good, sanitary order, condition and repair, and
further accepts all aspects of the Premises, Building, Property and
Business Park in their present condition, AS IS, including latent defects,
without any representations or warranties, express or implied, from
Landlord.
31. Hazardous Substances.
31.1 Tenant Obligations. Tenant shall not, without first obtaining
Landlord's prior written approval, generate, release, store, deposit,
transport, or dispose of (collectively "Release") any hazardous
substances, sewage, petroleum products, hazardous materials, toxic
substances or any pollutants or substances, defined as hazardous or
toxic in applicable federal, state and local laws and regulations
("Hazardous Substances") in, on or about the Premises. In the event,
and only in the event, Landlord approves such Release of Hazardous
Substances on the Premises, such Release shall occur safely and in
compliance with all applicable federal, state, and local laws and
regulations.
31.2 Tenant Indemnity. Tenant shall indemnify and defend (with counsel
approved by Landlord) Landlord, and hold Landlord harmless, from and
against any and all claims, liabilities, losses, damages, cleanup
costs, and expenses (including reasonable attorneys'
22
fees) arising out of or in any way relating to the Release by Tenant
or any of its agents, representatives, employees or invitees, or the
presence of any Hazardous Substances in, on or about the Premises
occurring as a result of or in connection with Tenant's use or
occupancy of the Premises at any time after the Commencement Date.
31.3 Landlord Inspection. Landlord shall have the right from time to time
to enter the Premises, Building and Property and inspect the same for
the presence of Hazardous Substances and compliance with the
provisions of this Section 31 and inspect the Premises, Building and
Property. Landlord may cause tests to be performed for Hazardous
Substances on the Premises from time to time. Tenant shall bear the
cost of the first such test in any calendar year and any other such
test that occurs upon a reasonable suspicion by Landlord that there
may be Hazardous Substances in the Premises in violation of Tenant's
obligations under this Lease.
31.4 Survival. The provisions of this Section 31 shall survive the
expiration or termination of this Lease with respect to any
occurrences during the Term.
32. Signs. Except as permitted under the terms of Section 1 A.5, Tenant shall
not place upon or install in windows or other openings or exterior sides of
doors or walls of the Premises any symbols, drapes, or other materials
without the written consent of Landlord. Tenant shall observe and comply
with the requirements of all Laws applicable to signage.
33. General Provisions.
33.1 Attorneys' Fees. In the event Landlord reasonably requires the
services of any attorney in connection with any Default or violation
by Tenant of the terms of this Lease or the exercise by Landlord of
its remedies for any Default by Tenant under this lease, or a request
by Tenant for Landlord's waiver of any terms of this Lease or
extension of time to perform or pay any obligation of Tenant under
this Lease, Tenant shall promptly on demand reimburse Landlord for its
reasonable attorneys' fees incurred in such instance. In the event of
any litigation, arbitration or other proceeding (including proceedings
in bankruptcy and probate and on appeal) brought to enforce or
interpret or other wise arising under this Lease, the substantially
prevailing party therein shall be entitled to the award of its
reasonable attorneys' fees, witness fees, and court costs incurred
therein and in preparation therefor.
33.2 Governing Law; Venue. This Lease shall be governed by and construed in
accordance with the laws of the State of Washington and venue for all
disputes shall be in King County, Washington.
33.3 Cumulative Remedies. No remedy or election under this Lease shall be
deemed exclusive but shall, wherever possible, be cumulative with all
other remedies at law or in equity.
33.4 Exhibits; Addenda. Exhibits and Addenda, if any, affixed to this Lease
are a part of and incorporated into this Lease.
33.5 Interpretation. This Lease has been submitted to the scrutiny of all
parties hereto and their counsel, if desired, and shall be given a
fair and reasonable interpretation in accordance with the words
hereof, without consideration or weight being given to its having been
drafted by any party hereto or its counsel.
33.6 Joint Obligation. If there is more than one Tenant under this Lease,
the obligations hereunder imposed upon Tenants shall be joint and
several.
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33.7 Keys/Premises Information. Within ten (10) days after expiration or
termination of this Lease, Tenant shall (a) surrender all keys and
access cards to the Premises, Building and Garage to Landlord at the
place then fixed for payment of Rent (b) to the extent in Tenant's
possession, deliver to Landlord any plans, drawing and specifications
(including any cabling or wiring diagrams) that relate to the Premises
or any improvements or alterations made by Tenant therein, and (c)
inform Landlord of all combination locks, safes, and vaults, if any,
in the Premises.
33.8 Late Charges; Interest. Late payment by Tenant to Landlord of Rent or
other sums due under this Lease will cause Landlord to incur costs not
contemplated by this Lease, the exact amount of which would be
difficult and impractical to ascertain. Such costs include without
limitation processing and accounting charges and late charges which
may be imposed on Landlord by the terms of any mortgage or trust deed
covering the Premises. Accordingly, Tenant shall pay to Landlord as
Additional Rent a late charge equal to five percent of such
installment as liquidated damages for such late payment, other than
for time value damages. A $50.00 charge will be paid by Tenant to
Landlord for each returned check. In addition, any Rent or other sums
due under this Lease to Landlord that is not paid when due shall bear
interest at the rate per annum of two percent over the prime rate in
effect at Bank of America d/b/a Seattle-First National Bank, Seattle
Head Office, on the day such Rent or other sum was due, which interest
shall constitute Additional Rent under this Lease. The existence or
payment of charges and interest under this Section shall not cure or
limit Landlord's remedies for any Default by Tenant under this Lease.
33.9 Light, Air, and View. Landlord does not guarantee the continued
present status of light, air, or view in, to or from the Premises.
33.10 Measurements. All measurements of the Premises stated in this Lease,
even if approximations, shall govern and control over any actual
measurement of the Premises and reflect the inclusion of a load factor
for the Building. The Rent provided in this Lease and Tenant's Share
shall not be modified or changed by reason of any measurement or
re-measurement of the Premises that may occur after the date of this
Lease, and is agreed by Landlord and Tenant to constitute the
negotiated rent for the Premises. The foregoing shall not be deemed to
modify any obligation of Landlord to construct the Premises in
accordance with the Work Letter.
33.11 Name. Tenant shall not use the name of the Building or Business Park
for any purpose other than as an address of the business conducted by
the Tenant in the Premises. The name of the Building or Business Park
may at any time be changed by Landlord.
33.12 Prior Agreements; Amendments. This Lease is the full, final and
complete expression of the agreements of the parties with respect to
any matter covered or mentioned in this Lease, and no prior agreements
or understandings, promises or representations, oral or otherwise,
pertaining to any such matters shall be effective for any purpose. No
provision of this Lease may be amended or added to except by an
agreement in writing signed by the parties or their respective
successors in interest. This Lease shall not be effective or binding
on any party until fully executed by both parties hereto.
33.13 Recordation. Tenant shall not record this Lease or a short form
memorandum of this Lease without the prior written consent of
Landlord.
33.14 Liability. Tenant agrees to look only to the equity of Landlord in
the Building and Property and not to Landlord personally with respect
to any obligations or payments due or which may become due from
Landlord hereunder, and no other property or assets of Landlord
24
or any partners, officers, directors, of Landlord shall be personally
liable in connection with this Lease.
33.15 Severability. That any provision of this Lease is invalid, void, or
illegal shall in no way affect, impair, or invalidate any other
provision of this Lease and such other provision shall remain in full
force and effect.
33.16 Time. Time is of the essence of this Lease and each of its
provisions.
33.17 Waiver. No provision of this Lease shall be deemed to have been
waived by Landlord unless such waiver is in writing signed by
Landlord's duly authorized representatives. The waiver by either party
of any provision of this Lease shall not be deemed to be a waiver of
such provision or any other provision, in any subsequent instance. The
acceptance of Rent by Landlord shall not be deemed to be a waiver of
any preceding Default or breach by Tenant under this Lease, whether
known or unknown to Landlord, other than the failure of the Tenant to
pay the particular Rent so accepted.
33.18 No Waste. Tenant shall not commit or suffer to be committed any
waste, damage or nuisance in or upon the Premises.
33.19 Force Majeure. If either party shall be prevented or delayed from
punctually performing any obligation or satisfying any condition under
this Lease, other than the payment of Rent or other sums due
hereunder, by any strike, lockout, labor dispute, inability to obtain
labor or materials or reasonable substitutes therefor, acts of God,
governmental restriction, regulation or control, enemy or hostile
governmental action, civil commotion, insurrection, sabotage, fire or
other casualty, or any other condition beyond the reasonable control
of such party, then the time to perform such obligation or satisfy
such condition shall be extended by the delay cause by, such event. If
either party shall, as a result of any such event, be unable to
exercise any right or option within any time limit provided therefor
in this Lease, such time limit shall be deemed extended for a period
equal to the duration of the delay caused by such event.
33.20 Quiet Enjoyment. Provided Tenant observes its obligations under this
Lease, its quiet enjoyment of the Premises throughout the Term shall
not be disturbed.
34. Authority of Tenant.
34.1 Tenant as Corporation. If Tenant is a corporation, each individual
executing this Lease on behalf of Tenant represents and warrants that
(s)he is duly authorized by all necessary action of the directors of
Tenant to execute and deliver this Lease on behalf of Tenant, and that
this Lease is binding upon Tenant in accordance with its terms.
34.2 Tenant as Partnership or LLC. If tenant is a partnership or limited
liability company, each individual executing this Lease on behalf of
Tenant represents and warrants that (s)he is duly authorized in
accordance with Tenant's partnership agreement or limited liability
company agreement by all necessary action of the partners or members
or managers of Tenant to execute and deliver this Lease on behalf of
Tenant, and, and that this Lease is binding upon Tenant in accordance
with its terms.
35. Financial Statements. Tenant shall furnish to Landlord from time to time,
within 30 days of request, Tenant's most recent financial statements,
including at a minimum a balance sheet, income statement and statement of
cash flows, or the equivalent, dated as of and for a period ending not more
than one quarter prior to the date of delivery. If Tenant is a
publicly-traded company, such statements may be in the same form as filed
with the appropriate governmental
25
authorities and may be in the form of the last filed annual statement as
opposed to the last quarterly statement. If Tenant is not a publicly-traded
company, such statements shall be in the form furnished to Tenant's
principal lender and/or to Tenant's shareholders or other owners, but at a
minimum shall be reviewed or compiled by an independent certified public
accountant. If Tenant is not a publicly-traded company, Tenant shall
accompany such statements with a certificate of its chief financial officer
that the statements fairly present the financial condition and results of
operations of Tenant as of and for the period ending on the date of such
statements. Landlord shall not request financial statements under this
Section more than once each calendar year.
36. Commissions. Any commissions payable as a result of the execution of this
Lease shall be paid pursuant to a separate commission contract. Each party
represents and warrants to the other that it has not had dealings with any
real estate broker other than the Broker identified in Section 1, agent or
salesperson with respect to this Lease that would cause the other party to
have any liability for any commissions or other compensation to such
broker, agent or salesperson, and that no such broker, agent or salesperson
has asserted any claim or right to any such commission or other
compensation. Such representing party shall defend and indemnify the other
party and hold the other party harmless from and against any and all loss,
cost, liability, damage and expense (including reasonable attorneys' fees)
whatsoever that may arise out of the breach of such representation and
warranty.
This Lease shall be effective as of the later of the dates of Landlord's and
Tenant's signature on this Lease, as set forth below.
LANDLORD:
SNOQUALMIE RIDGE CASCADE VIEW LLC
By The Quadrant Corporation, its Member
By: /s/ Xxxxxx. X. Xxxxxxx. Jr.
------------------------------------
Name: Xxxxxx. X. Xxxxxxx. Jr.
Title: Vice President
Date: 2/28/00
By Connecticut General Life Insurance Company,
on behalf of its Separate Account R, its Member
By: CIGNA Investments, Inc.
By: /s/ Xxxx X. Xxxxxx
------------------------------------
Name: Xxxx X. Xxxxxx
Title: Managing Director
Date: 3/2/2000
26
TENANT:
GREAT PLAINS SOFTWARE O.C., INC.
By: /s/ XXXXX X. X'XXXX
--------------------------------
Name: XXXXX X. X'XXXX
Title: VP OF BUSINESS DEVELOPMENT
Date: 2-24-00
27
STATE OF WASHINGTON )
) ss.
COUNTY OF KING )
I certify that I know or have satisfactory evidence that Xxxxxx X. Xxxxxxx
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 Vice President of THE QUADRANT
CORPORATION, a corporation, which is a Member of SNOQUALMIE RIDGE CASCADE VIEW
LLC, the limited liability company that executed the within and foregoing
instrument, to be the free and voluntary act of such party for the uses and
purposes mentioned in the instrument.
Dated this 28th day of February, 2000.
(SEAL) /s/ Xxxx Xxxxxxx
----------------------------------------
----------------------------------------
(print or type name)
NOTARY PUBLIC in and for the State of
Washington, residing at Bellevue
My Commission expires: 7/01/03
[Seal or Stamp]
28
STATE OF Connecticut )
) ss.
COUNTY OF Hartford )
I certify that I know or have satisfactory evidence that Xxxx Xxxxxx 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 Managing Director of CIGNA
INVESTMENTS, INC., a corporation, which is the ________________ if CONNECTICUT
GENERAL LIFE INSURANCE COMPANY, a corporation, which is a Member of SNOQUALMIE
RIDGE CASCADE VIEW LLC, the limited liability company that executed the within
and foregoing instrument, to be the free and voluntary act of such party for the
uses and purposes mentioned in the instrument.
Dated this 2 day of March, 2000.
(STAMP) /s/ Xxxxx X'Xxxx
----------------------------------------
----------------------------------------
(print or type name)
NOTARY PUBLIC in and for the State of
CT, residing at Hartford
My Commission expires: 11/30/04
[Seal or Stamp]
29
STATE OF Minnesota )
) ss.
COUNTY OF Clay )
On this 24 day of February, 2000, before me, the undersigned, a Notary Public in
and for the State of Minnesota personally appeared Xxxxx X'Xxxx, to me known to
be the VP of Business Development of GREAT PLAINS SOFTWARE O.C., INC., the
corporation that executed the 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 the said instrument on behalf of said party.
WITNESS MY HAND AND OFFICIAL SEAL hereto affixed the day and year first above
written.
(STAMP) ----------------------------------------
Name Xxxxxxx X. Xxxxxxx
NOTARY PUBLIC in and for the State of
Minnesota residing at Moorhead
My commission expires 1/31/05
30
EXHIBIT A-1
to that Lease between
SNOQUALMIE RIDGE CASCADE VIEW LLC, LANDLORD
and
GREAT PLAINS SOFTWARE O.C., INC., TENANT
PREMISES
[2ND FLOOR PLAN]
00000 XX Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000
X-0
XXXXXXX X-0
to that Lease between
SNOQUALMIE RIDGE CASCADE VIEW LLC, LANDLORD and
GREAT PLAINS SOFTWARE O.C., INC., TENANT
LEGAL DESCRIPTION OF PROPERTY
Lot 2 of City of Snoqualmie Certificate of Segregation No. 99-01 as recorded
under King County Recording Number 9904019007, Records of King County,
Washington.
1
EXHIBIT A-3
to that Lease between
SNOQUALMIE RIDGE CASCADE VIEW LLC, LANDLORD and
GREAT PLAINS SOFTWARE O.C., INC., TENANT
LEGAL DESCRIPTION OF BUSINESS PARK
All that property contained within the exterior boundary of City of Snoqualmie
Binding Site Improvement Plan No. BSIP 97-01 (also known as Snoqualmie Ridge
Binding Site Improvement Plan No. 1) per instrument filed in Volume 185 of
Surveys, Pages 32 through 38, inclusive, Recording No. 9805051715, Records of
King County, Washington. Said binding site improvement plan was amended by that
Affidavit of Correction filed under King County Recording No. 9805190462.
1
EXHIBIT B
to that Lease between
SNOQUALMIE RIDGE CASCADE VIEW LLC, LANDLORD and
GREAT PLAINS SOFTWARE O.C., INC., TENANT
WORK LETTER
1
WORK LETTER AGREEMENT
TENANT IMPROVEMENTS
Work Letter Agreement ("Agreement"), dated for reference purposes as of the
2nd day of March, 2000, by and between SNOQUALMIE RIDGE CASCADE VIEW LLC, a
Washington limited liability company ("Landlord"), and GREAT PLAINS SOFTWARE
O.C, INC., a Minnesota corporation ("Tenant").
Concurrently with the execution of this Agreement, Landlord and Tenant have
entered into a lease ("Lease") covering certain premises ("Premises") more
particularly described in Exhibit A-1 attached to the Lease.
In order to induce Tenant to enter into the Lease and in consideration of
the mutual covenants hereinafter contained, Landlord and Tenant hereby agree as
follows. Capitalized terms used, but not otherwise defined, herein shall have
the meanings ascribed to them in the Lease.
1. COMPLETION SCHEDULE
1.1 Attached is a schedule ("Work Schedule") setting forth a timetable for
the planning and completion of the installation of the Tenant
Improvements to be constructed in the Premises prior to the
Commencement Date of the Lease. The Work Schedule sets forth each of
the various items of work to be done by or approval to be given by
Landlord and Tenant in connection with the completion of the Tenant
Improvements. The Work Schedule shall be the basis for completing the
Tenant Improvements work. Landlord and Tenant shall each exert their
good faith, reasonable and diligent efforts to achieve completion or
approval of the matters described in the Work Schedule on or before
the dates set forth therein; and Landlord and Tenant each agree to
promptly and diligently respond to all questions and concerns raised
by architects, engineers and other consultants in connection
therewith.
2. LANDLORD'S WORK
2.1 Landlord shall complete, at its sole cost, on or before the
Commencement Date the following items ("Landlord's Work"):
2.1.1 All site work.
2.1.2 Finished first floor lobby.
2.1.3 Toilet cores on first and second floors (including showers on
both floors, subject to Section 2.2).
2.1.4 Rooftop-mounted variable air volume HVAC system with vertical
supply duct and return air shaft to each floor.
2.1.5 Power and communications to central rooms.
2.1.6 Second floor lobby shell.
2.2 Building Modifications. The current plans for Landlord's Work
contemplate construction of second floor showers and construction of
the HVAC air shaft in a certain location. The construction of the
second showers and the particular location of the HVAC air shaft are
necessitated by the special requirements of a prospective tenant with
whom Landlord is presently negotiating a lease for the entire first
floor of the Building. Landlord reserves
1
the right to eliminate the second floor showers, unless Tenant agrees
to pay for showers as a Tenant Improvement item, and relocate the HVAC
air shaft to a different location if Landlord does not enter into a
lease with such prospective tenant, in which case the Tenant
Improvement Plans shall be modified to reflect such changes.
3. TENANT IMPROVEMENTS; TENANT IMPROVEMENTS PLANS
3.1 In this Agreement "Tenant Improvements" shall include all work to be
done in the Premises pursuant to the Tenant Improvements Plans
described in and developed in accordance with this Section 3, as
modified by Tenant pursuant to Section 4. Landlord and Tenant shall
prepare a Space Plan for the Tenant Improvements in accordance with
the Work Schedule. The Space Plan, once prepared, shall then be
subject to each party's review and approval in accordance with the
Work Schedule. Based upon the mutually-approved Space Plan, Landlord
shall then prepare the Tenant Improvements permit plans (i.e., the
plans used for submittal to the appropriate governmental bodies for
all necessary permits and approvals) and the Tenant Improvements
construction documents, (i.e., final working drawings and
specifications for the Tenant Improvements) in accordance with the
Work Schedule. The Tenant Improvements construction documents, once
prepared, shall then be subject to each party's review and approval in
accordance with the Work Schedule. The Tenant Improvements
construction documents, once mutually-approved, shall then constitute
the "Tenant Improvements Plans."
3.2 After determination of the Space Plans and preparation of the Tenant
Improvements permit plans, the Tenant Improvements permit plans shall
be submitted to the appropriate governmental body for plan checking
and issuance of necessary permits and approvals. Landlord, with
Tenant's cooperation, shall cause to be made any changes in the Tenant
Improvements permit plans, Tenant Improvements construction documents
and Tenant Improvements Plans necessary to obtain such permits and
approvals.
4. TFNANT REQUESTED CHANGES TO TENANT IMPROVEMENTS PLANS
4.1 After determination of the Tenant Improvements Plans, Tenant may, at
Tenants election, request revisions, modifications, changes and
amendments to the Tenant Improvements Plans; and, subject to
Landlord's consent and approval, in the exercise of Landlord's
reasonable discretion, the Tenant Improvements Plans shall be so
revised, provided, however, that all costs relating to re-design of
the Tenant Improvements for such change, costs for changes to the
Tenant Improvements Plans, additional permitting or fees which may be
required in connection with such change, and any increased Tenant
Improvements construction costs shall be paid by Tenant. Additionally,
any delay resulting from any such changes together with the time
period for the preparation of estimates and review and approval by
Landlord and Tenant shall constitute a Tenant Delay in accordance with
the provisions of Section 8. If approved by Landlord, changes to the
Tenant Improvements Plans shall be evidenced by written change order
signed by Landlord, Tenant and the Tenant Improvements contractor.
Landlord shall have the right to decline Tenant's request for a change
to the Tenant Improvements Plans if such changes are inconsistent with
the other provisions of this Agreement, if such change would, in
Landlord's judgment, delay completion of the Tenant Improvements
beyond the Commencement Date, or if such change would, in Landlord's
judgment, substantially alter the quality or character of the Building
in which the Premises are situated.
5. DETERMINATION OF FINAL PRICING
5.1 After the determination of the Tenant Improvements Plans, Landlord
shall prepare and deliver to Tenant a final pricing in accordance with
the Work Schedule, which final pricing
2
shall remain subject to adjustment for any modifications to the Tenant
Improvements Plans required by the appropriate governmental body in
connection with the issuance of permits and approvals.
6. CONSTRUCTION OF TENANT IMPROVEMENTS
6.1 Landlord shall cause the Tenant Improvements to be substantially
completed sufficient for the issuance of a temporary certificate of
occupancy for the Premises on or before the Commencement Date of the
Lease in accordance with the provisions set forth in this Work Letter.
Landlord shall supervise the completion of such work and shall use
diligent efforts to secure substantial completion of the work in
accordance with the Work Schedule. The cost of such work shall be paid
as provided in Section 7.
6.2 In connection with the construction of the Tenant Improvements,
Landlord and Tenant shall arrange for Tenant to have access to the
Premises commencing approximately 75 days prior to the estimated date
for substantial completion shown on the Work Schedule, in order to
allow Tenant to install telephone lines and telephone systems, fiber
optics, computer cabling, and related similar matters, and, on a
"space ready" basis only, to commence installation of Tenant's trade
fixtures. Tenant shall schedule installation of such items with
Landlord and the Tenant Improvements contractor so as not to
unreasonably impede, interfere with or delay the progress of
construction of the Tenant Improvements; and Tenant shall perform such
installation in accordance with any guidelines provided by the Tenant
Improvements contractor. Delay, interference or damage arising out of
Tenant's installation of such items shall constitute a Tenant Delay
under Section 8. Any and all costs of installation of such items shall
be at Tenant's sole cost and expense.
6.3 During the period of construction of the Tenant Improvements, Landlord
shall consult with Tenant from time to time as necessary to achieve
approval of certain matters and installations related to the Tenant
Improvements. Such approvals shall be forthcoming from Tenant within a
reasonable time period as requested by Landlord, which time period
shall enable Landlord to maintain the schedule for substantial
completion of the Tenant Improvements stated in the Work Schedule.
Failure of Tenant to respond within such requested time period shall
constitute a Tenant Delay.
6.4 During the period of construction of the Tenant Improvements, Landlord
and Tenant shall meet at regular meetings occurring at least once
monthly regarding the status of the construction and occurring at
least once weekly during the final month of construction. If timely,
matters requiring Tenant's approval may be determined at such meetings
and decisions shall be reflected in the minutes of such meetings.
7. PAYMENT OF COST OF THE TENANT IMPROVEMENTS
7.1 Design Allowance. Tenant is entitled to a "Design Allowance" of up to
$20,055. Such Design Allowance shall be used only for payment of the
cost of preparing the space plan and the final working drawings and
specifications, including mechanical, electrical, plumbing and
structural drawings and all other aspects of the Tenant Improvements
Plans.
7.2 Tenant Improvement Allowance. Tenant is entitled to a "Tenant
Improvement Allowance" of $1,002,750. Such Tenant Improvement
Allowance shall be used only for:
7.2.1 The payment of plan check, permit, license fees and insurance
premiums relating to construction of the Tenant Improvements.
3
7.2.2 Construction of the Tenant Improvements, including without
limitation the following:
7.2.2.1 Installation within the Premises of all partitioning,
doors, window coverings, floor coverings, ceilings, wall
coverings and painting, millwork and similar items.
7.2.2.2 All electrical wiring, lighting fixtures, outlets and
switches and other electrical work to be installed within
the Premises.
7.2.2.3 The furnishing and installation of all duct work,
terminal boxes, diffusers and accessories required for the
completion of the heating, ventilation and air conditioning
systems within the Premises, including the cost of meter and
key control for after-hour heating, ventilation and air
conditioning.
7.2.2.4 Any additional Tenant requirements including but not
limited to odor control, special heating, ventilation and
air conditioning, noise or vibration control or
other special systems.
7.2.2.5 All fire and life safety control systems such as fire
walls, sprinklers, halon, fire alarms, including piping,
wiring and accessories installed within the Premises.
7.2.2.6 All plumbing, fixtures, pipes and accessories to be
installed within the Premises.
7.2.2.7 Testing and inspection costs.
7.2.2.8 Contractor's fees, including but not limited to any fees
based on general conditions.
7.2.2.9 All applicable Washington State sales taxes.
7.3 The cost of each item shall be charged against the Design Allowance or
the Tenant Improvement Allowance, as applicable, until the applicable
allowance is exhausted. In the event that the cost of designing the
Tenant Improvements exceeds the Design Allowance, or the cost of
installing the Tenant Improvements, as established by the final
pricing schedule to be determined by Landlord and Tenant, exceeds the
Tenant Improvement Allowance, or if any of the Tenant Improvements are
not to be paid out of the Tenant Improvement Allowance, then the
excess shall be paid by Tenant to Landlord not later than thirty days
after invoice from Landlord to Tenant for the same, but in no event
shall such excess be due prior to June 1, 2000.
7.4 If, after the Tenant Improvements Plans have been established and the
final pricing has occurred, Tenant shall require changes or
substitutions to the Tenant Improvements Plans, any additional costs
thereof shall be paid by Tenant to Landlord not later than thirty days
after invoice from Landlord to Tenant for the same, but in no event
shall such payments be due prior to June 1, 2000. Landlord shall have
the right to decline Tenant's request for a change to the Tenant
Improvements Plans as provided in Section 3.1.
7.5 In the event that the cost of the Tenant Improvements increases as set
forth in Landlord's final pricing due to the requirements of any
governmental agency and such increases exceed any available remaining
amount of the Tenant Improvement Allowance, Tenant
4
shall pay Landlord the amount of such increase within 30 days after
receipt of Landlord's invoice for the same, but in no event shall such
excess be due prior to June 1, 2000.
8. TENANT DELAY
8.1 As used in this Agreement and in the Lease, "Tenant Delay" means any
delay caused by (i) Tenant's failure to meet its obligations under the
Lease or this Agreement, (ii) Tenant initiated changes to the Tenant
Improvements Plans, (iii) Tenant's failure to perform actions or
approve items in accordance with the Work Schedule or Section 1.1, or
(iv) interference or damage arising out of Tenant's installation of
telephone lines and telephone systems, fiber optics, computer cabling,
and related similar matters pursuant to Section 6.2.
8.2 In addition to the provisions in Article 4 of the Lease addressing the
effects of Tenant Delay on the Commencement Date and the Rent
Commencement Date, Tenant shall indemnify, defend and hold Landlord
harmless from and against any and all claims, liabilities, liens,
costs and expenses (including attorneys' fees) arising out of or
otherwise attributable to the Tenant Delay.
9. SUBSTANTIAL COMPLETION
9.1 The Tenant Improvements shall be deemed substantially complete
notwithstanding the fact that minor details of construction,
mechanical adjustments or decorations which do not materially
interfere with Tenant's use and enjoyment of the Premises remain to be
performed (items normally referred to as "punch list" items). Landlord
shall proceed with all due diligence to complete the punch list items
as soon as reasonably possible.
10. TENANT REPRESENTATIVE
10.1 Tenant appoints Xxx Xxxxxx as Tenant's Representative to act for
Tenant in all matters under this Agreement. All inquiries, requests,
instructions, authorizations, and other communications under this
Agreement may be made by Landlord to Tenant's Representative. Tenant
may change the identity of Tenant Representative by notice in writing
to Landlord.
11. SIGNAGE DURING CONSTRUCTION
11.1 During the construction period, to the extent permitted by the City of
Snoqualmie, Landlord may provide such signage stating the future
tenancy of Tenant as Landlord deems appropriate.
12. WARRANTIES
12.1 Landlord shall obtain from all contractors and subcontractors
providing material and labor in the construction of the Tenant
Improvements all commercially reasonable warranties (including
manufacturers' warranties) for their respective materials or labor
which are available from such contractors or subcontractors. All such
warranties shall be in writing and shall run to Landlord. To the
extent there exists any defect in the Tenant Improvements, which is
covered by the warranties obtained under this Section, Landlord shall
seek to enforce such warranties in accordance with their terms.
13. GENERAL
5
13.1 The provisions of the Lease and of the Exhibits hereto are made a part
of this Agreement. The parties shall execute such further documents
and instruments and take such other further actions as may be
reasonably necessary to carry out the intent and provisions of this
Agreement.
This Agreement shall be effective as of the later of the dates of Landlord's and
Tenant's signature on this Agreement, as set forth below.
LANDLORD:
SNOQUALMIE RIDGE CASCADE VIEW LLC
By: The Quadrant Corporation, its Member
By: /s/ Xxxxxx. X. Xxxxxxx. Jr.
------------------------------------
Name: Xxxxxx. X. Xxxxxxx. Jr.
Title: Vice President
Date: 2/28/2000
By Connecticut General Life Insurance
Company, on behalf of its Separate
Account R, its Member
By: CIGNA Investments, Inc.
By: /s/ XXXX X. XXXXXX
------------------------------------
Name: XXXX X. XXXXXX
Title: MANAGING DIRECTOR
Date: 3/2/2000
TENANT:
GREAT PLAINS SOFTWARE O.C., INC.
By: /s/ XXXXX X. X'XXXX
------------------------------------
Name: XXXXX X. X'XXXX
Title: VP OF BUSINESS DEVELOPMENT
Date: 2-24-00
6
WORK SCHEDULE
DATE ACTION ITEM
---- -----------
2/23/00 Preparation of Space Plan and Submission to Landlord and Tenant for
Approval
2/23/00 Tenant and Landlord Approval of Space Plan
2/25/00 Tenant and Landlord Execution of Lease Document
3/06/00 Tenant Improvements Permit Plans Submitted for Tenant Improvements
Construction Permit
3/13/00 Architect Completion of Draft Tenant Improvements Construction
Documents "Check Set" and Submission to Landlord and Tenant for
Approval
3/17/00 Tenant and Landlord Approval of Tenant Improvements Construction
Documents (i.e., Determination of Tenant Improvement Plans)
3/24/00 Determination of Final Pricing
3/21/00 Tenant Improvements Construction Permit Issued
6/27/00 Substantial Completion and Issuance of Temporary Certificate of
Occupancy
6/19/00 Lease Commencement Date
7
Exhibit B
FURNITURE, FIXTURES & EQUIPMENT
The following items generally reflect the recording of the walk through of
the space by representatives from Light Sciences and Microsoft on
September 7, 2002.
- Eight (8) private offices with furniture
- Two (2) folding tables
- Fifty-two (52) task chairs
- Nine (9) guest chairs
- Forty-one (41) Steelcase workstations
- One (1) tall wood bookcase
- One (1) shelf bookcase
- Six (6) 60" tables
- One (1) 42" table
- Three (3) 30" tables
- One (1) sofa
- Two (2) cherry lounge chairs
- One (1) credenza
- One (1) drum table
- Three (3) storage cabinets
- Six (6) miscellaneous tables
- One (1) AV cart
- One (1) Liebert unit
B-1
Exhibit C
Space Plan
C-1
[2ND FLOOR PLAN]
Schedule C
Diagram of Subleased Premises
Schedule D
Designated Shared Equipment
Asset ID Asset Description
-------- -----------------
0002 Radiometer & Sphere
0000 Xxxxxx & Xxxx XXX 0 Microscope w/accesso
0033 18 Channel Mixed Signal Oscilloscope
0034 Clean Room
0195 Programmable DC Power Supply (Dual)
0310 Multi-Channel Spectroradiometer OL 770
0318 Heavy Load Workstation w/Sci Gr Breadbd
0320 USB 2000-FL Optic Spectrometer w/LED
0321 Ocean Optics 2000 Fiber Optic Spectromet
0336 PC-3 ULTRA, 115V, 50 W, Spot Lamp
0362 Waverunner 6050, 0 xx, 000XXx 0XX/x XXX
0374 DC power supply, dual output, dual range
0389 81pc set Cera/Steel Gage Block Set
0399 Stereo Zoom Microscope
0405 XPERT Labconco Fume Xxxx, Xx Srfc, Stand
0406 Filtermate 115V Hepa-Carbon Filter
0411 HEPA Purifier Enclosure w/Wk Sfc & Base
0450 BeamStar FX 66 Camera w/Software & Accs
0524 Vertical Milling Machine
The Designated Shared Equipment includes miscellaneous lab
supplies and tools located in the Shared Areas.
