AIRPORT INDUSTRIAL PARKLEASE
THIS LEASE is made and entered into this_________ day of ______________
2000, by and between the PORT OF BELLINGHAM, a municipal corporation,
hereinafter called LESSOR, and SAFE TRANSPORTATION SYSTEMS, INC., a Florida
corporation, hereinafter called LESSEE,
ARTICLE I
Recitals
1.1 PRELIMINARY STATEMENT: The Lessor is the owner of certain real
property and Improvements located within the area commonly known as the AIRPORT
INDUSTRIAL PARK, and the Lessee desires to lease said real property and
improvements located thereon for the purposes of conducting Its business
operations.
1.2 EXHIBITS:
Exhibit "A" Legal Description of the Property in which the
Premises are located -- Lease #25 of the Airport
Binding Site Plan
Exhibit "B" Sketch of Premises
Exhibit "C" To be attached in accordance with Section 2.1.2
herein.
Exhibit "D" General Description of Tenant Improvents And
Estimated Cost
Exhibit "E" Final Cost of Tenant Improvements
All of the above described exhibits are attached to this lease an by
this reference are made a part hereof.
ARTICLE II
Premisses, Terms, Renewals
2.1 PREMISES: Lessor, in consideration of the rents hereinafter
reserved and of the covenants and conditions herein set forth to be performed by
Lessee, does
1
hereby demise and let unto Lessee, a portion of the real property and
Improvements decribed in Exhibit "A" and "B" above and commonly referred to as
the oact cido of the International Trade Building, containing approximately
29,829 square feet, described as Lease #25 of the Bellingham International
Airport Binding Site Plan (hereinafter "Premises").
2.1.1 Upon execution of this Lease, the Lessor shall cause to be
prepared a binding site plan creating the exact Premises. The Lessee shall bear
the cost of the preparation, filing and recordation of the Bellingham
International Airport Binding Site Plan.
2.1.2 The parties understand that the Bellingham International Airport
Binding site plan has not, as of the dalo huroof, been approved by the County of
Whatcom. The parties further understand and agree that at the the binding Site
Plan is approved and recorded the auditors file number will then be noted and
attached hereto as Exhibit "C". The parties further agree that the fact that a
Binding Site Plan creating the exact Premises has not yet been prepared will not
effect the validity of this Lease.
2.2 TERM AND COMMENCEMENT DATE: The term of this lease shall be for
FIVE (5) years beginning December 1, 2000.
2.3 RENEWAL: Provided the 1ease is in good standing. I _______________
have the right to renew this lease for three (3) consecutive five-year periods
by giving written notice of such intention to Lessor at least one-hundred twenty
(120) days prior to the expiration of the term of this lease or any renewal
thereof.
ARTICLE III
Compensation, Rental Renegotiation,
Arbitration and Performance Bond
3.1 RENT- As monthly rent, Lessee shall pay to Lessor in U.S. funds,
the sum of the following:
a. Building rent $ 14,019.63, and;
b. Tenant improvement rent $ 1,094.22
All rental payments, plus applicable state leasehold tax, are to be made monthly
in advance on or before the lst day of each month beginning March 1, 2001. A
late charge of 1% per month will be assessed against past due amounts.
2
3.1.1 There shall be no rent due or collected for the first three (3)
months of the Lease. Such three (3) month period shall begin December 1, 2000
and shall end February 26. 2001, However, the Lessee shall be responsible for
the payment of all app1icable State leasehold tax during the no rent period. In
addition, tho no rent period shall not apply to the rent attributable to the
tenant Improvements.
3.2 TENANT IMPROVEMENTS: The list of tenant improvements requested by
the Lessee is attached hereto as Exhibit "D". The Lessor estimates that the
tenant improvements will cost approximately $51,500.00 plus applicable
Washington state sales tax. The portion of the rent attributable to tenant
improvements is calculated using this estimate, amortized over five (5) years
with a rate or return to the lessor of ten (10%) per annum.
3.2.1 Upon completion of the tenant improvements by the Lessor the
actual costs shall be attached hereto as Exhibit "E". The actual cost of the
tenant Improvements, as contained in Exhibit "E", shall be used to calculate the
actual tenant Improvement rent assuming amortization of the actual cost over
five (5) years with a rate of return to Lessor of ten (10%) per annum. The
recalculation of the monthly rent as provided herein shall not effect the
validity of this Lease.
3.3 RENTAL RENEGOTIATION: Should Lessee renew said lease pursuant to
Section 2.3 herein, rent for the premises (including the value of the tenant
improvements) shall be subject to adjustment. The parties agree to renegotiate
the amount of rent payable to Lessor every five years, and to agree on the
amount at least ninety (90) days prior to the commencement of each succeeding
five (5) year period, (hereinafter "Rental Renegotiation Deadline"). In no event
will the rent payable by Lessee be less than the original rent for the preceding
lease year.
3.4 ARBITRATION: If the parties cannot agree on an adjustment of rent,
then the parties shall select an arbitrator within ten (10) days of the Rental
Renegotiation Deadline. If the parties cannot agree on an arbitrator within this
time, either party may apply to the Superior Court of Whatcom County for an
order appointing an arbitrator. The Court shall select an arbitrator, who shall
render his/her decision no later than 60 days after his/her appointment. If the
arbitrator requests a hearing prior to rendering his/her decision, such hearing
shall be hold within 30 days of the arbitrator's appointment. The Arbitrator's
decision shall be binding on both parties. Each party shall bear their own
expenses associated with the arbitration.
Notwithstanding the foregoing, the Lessee may exercise the right to
arbitration only if Lessee is not in default with respect to any rental payment
or other covenant or condition of the lease. Furthermore, arbitration, in
accordance with the above procedure, does not relieve Lessee of its obligation
to continue paying rent during the arbitrator's decision making period.
3
3.5 PERFORMANCE BOND: In compliance with the requirements of State law,
Lessee agrees that it will secure the performance of the rental portion of this
lease by a good and sufficient bond, or equal surety, satisfactory to Lessor in
an amount not less than:
a. thirty three percent (33%) of the sum of annual rent, And:
b. 100% of the estimated cost of the tenant improvements as contained
in Exhibit "D".
plus State leasehold tax on the entire amount. Such bond shall be obtained
within fourteen (14) days of execution of this lease. Lessee shall forward
evidence of such bond to Lessor within fourteen (14) of execution of the lease.
Failure to comply with the requirements shall be grounds for termination of this
lease without notice to the lessor. Said bond shall comply with the requirements
of Washington law and shall be kept always in effect. In the event of failure to
keep such bond in full force and affect, this lease may be canceled upon thirty
(30) days written notice to Lessee.
ARTICLE IV
Use of Premises. Condition of Property, improvemants,
Removal of Property, Maintenance, Utilities, Federal Aviation Fiiauir,ernoni
Fire Protection and Parking
4.1 LESSEE'S USE OF PREMISES; lessee shall only conduct the following
activity on the leased premises; CORPORATE HEADQUARTERS FOR [illegable] OF SAFE
TRANSPORTATION SYSTEMS. Failure of Lessee to perform this type of business or
cessation of such services, for any period of time exceeding 30 days, or
carrying on other activities without first obtaining a validly executed lease
modification in compliance with the applicable provisions of this Lease, shall
constitute default under the terms of this Lease. In the conduct of this
activity, Lessee agrees to properly and fairly serve the public, providing
reasonable hours of operation, suitable services, and tariff charges In keeping
with recognized standards of the trade. Failure of Lessee to so serve the public
for a period of 31 consecutive days or more shall be considered a breach of this
clause and thereby constitute a cause of default. It is further understood and
agreed the leased premises shall not be used to store, distribute or otherwise
handle flammable or dangerous materials.
4.2 CONSTRUCTION OF TENANT IMPROVEMENTS: Upon execution of this
lease and the posting of the performance bond as required herein, the lessor
shall construct the tenant improvements as generally described in Exhibit "D"
4
attached hereto. The Lessor shall work diligently and expeditiously to complete
the tenant improvements described in Exhibit "D". Such tenant improvements shall
remain the property of the Lessor.
4.3 CONDITION OF PROPERTY: Except for the Lessor's obligation to
construct, in a good and workmanlikee manner, the tenant improvements as
described on Exhibit "D", the Lessee accepts the leased premises "as is" without
further maintenance liability on the part of the Lessor, and is not relying an
any representationss of Lessor as to condition or usability, except Lessor's
right to grant a lease of the property.
4.4 IMPROVEMENTS BY LESSEE: Type Permitted , Subject to obtaining
written approval as hereafter described, Lessee may make and install at its own
[illedgable] in connoction With the activity described in Section 4.1. Lessee's
contractor, if any, shall be subject to Lessor's approval, not unreasonably
withheld, Lessor reserves the right to condition its approval upon the Lessee
providing satisfactory payment and/or performance bonds. Lessee shall submit
plans to and obtain written approval from Lessor before commencing any
improvements. All Improvements by Lessee shall conform to the requirements of
the Americans With Disabilities Act, 42 USC 12111 et seq and the Rules,
Regulations and Minimum Standards for the Bellingham International Airport.
4.4.1 Disposition of Improvements at end of Lease - Lessee shall have
the right to remove all equipment, personal property and improvements which are
not fixtures, which may have been placed upon the premises by itself during the
period of this lease providing that the same are removed before the lease is
terminated and that the lease is in good standing. Any Improvements, not
removedd from the premises by the conclusion of the lease shall, at Lessor's
option, revert to Lessor, Leased premises will be restored by Lessee to
conditions prevailing at the time of initiation of the lease, normal wear
excepted, All improvements which are to be designated fixtures shall be so
designated by Lessor upon Lessor's approval of the plans for such Improvements.
4.5 REMOVAL OF PROPERTY: If Lessee fails to remove any of its personal
property from the premises or the building at the termination of this lease or
when Lessor has the right of re-entry, Lessor may, at its option, remove and
store said property without liability for loss thereof or damage thereto, such
storage to be for the account and at the expense of Lessee. If Lessee fails to
pay the storage costs after thirty (30) days or more, Lessor may, at its option,
sell any or all of such property at public or private sale, in such manner and
at such times and places as Lessor, in its sale discretion, may deem
appropriate, without notice to Lessee, and shall apply the proceeds of the sale
first to the costs of the sale, including attorney's fees, second to the storage
costs, third to the payment of any amounts then or thereafter due to Lessor from
Lessee under this lease. The balance, if any, shall be returned to Lessee.
5
4.8 MAINTENANCE OF FACILITIES: Maintenance of the leased Promises and
all Improvements thereon is the responsibility of Lessee.
4.7 UTILITIES: Lessee will arrange and pay for all utility connections
and services and distribution of such utilities within its leased premises. At
the conclusion of this lease, Lessee shall arrange for such utility services to
be terminated and for the final xxxx to be sent to Lessee. Lessee shall be
liable for all utility charges that accrue If it falls to so terminate services.
4.8 FEDERAL AVIATION REQUIREMENTS: The Lessee agrees that its use of
the premises will be accomplished in accordance with the following covenants:
4.8.1 Lessee shall prevent any use of the premises which would
interfere with landing or taking off of aircraft at the Bellingham International
Airport, or otherwise constitute an airport hazard.
4.8.2 Lessee shall prevent any operation on the premises which would
produce electromagnetic radiations of a nature which would cause interference
with any air navigational or communications aid now or in the future to be
installed to serve the Bellingham International Airport, or which would create
any interfering or confusing light or cause any restrictions to visibility at
the airport.
4.8.3 lessor retains the public right of flight for the passage of
aircraft in the airspace above the surface of the premises hereinbefore
described, together with the right to cause in said airspace such ,noise as may
be inherent in the operation of aircraft, now known or hereafter used for
navigation of or flight in said airspace, and for use of said airspace for
landing on, taking off from or operating on the Bellingham International
Airport.
4.8.4 Lessee understands that it is the policy of the U.S. Department
of Transportation that minority business enterprises as defined in 48 CFR, Part
28, shall have the maximum opportunity to participate in the performance of this
lease as defined in 49 CFR, Section 23.5, and that this agreement is subject to
49 CFR, Part 23, as applicable. Lessee hereby assures that no person shall be
excluded from participation in, denied the benefits of, or otherwise
discriminated against in connection with 49 CFR, Part 23, on the grounds of
race, color, national origin, or sex.
4.9 FIRE PROTECTION: The Lessee understands that the Lessor has no
responsibility to provide fire protection for the Lessee's buildings, property
or equipment located in or upon the leased premises, It shall be the exclusive
responsibility of the Lessee to provide for its own fire protection, including
but not limited to, promptly paying all fire district service charges when due.
In this regard, the Lessee understands that it is the Lessee's responsibility
6
and duty to include the value of its buildings, property and equipment to
appropriate County authorities for personal property tax purposes through which
fire district service charges are paid. Failure of the Lessee to [illedgable].
The Leassee shall promptly provide the Lessor with a copy of its personal
property daclaration within seven (7) days from the time such doclaration is
made to the Whatcom County Assessor.
4.10 PARKING: The Lessor and Lessee shall cooporate in good faith to
accomodate [illedgable] International Trade Building.
ARTICLE V
Miscellaneous Provisions
5.1 INSURANCE: The parties herto agree that the Lessor shall not be
responsible to the Lessee for any property loss or damage done to the Lessee's
property, [illedgable]. It shall be the Lossee's responsibility to provide its
own protection against [illedgable] losses of whatsoever kind or nature,
regardless of whether or not such loss is occasioned by the acts or omissions of
the Lessor, Lessee, third party, or act of nature.
5.1.1 [illedgable] existence of this clause, carry a comprehensive
general liability insurance policy, naming both parties hereto as insured, with
a bodily injury amount of not less than $500,000 aggregate per person and per
accident. Lessee shall provide evidence of such insurance to Lessor. The lessor
believes [illedgable] .occurrences, whether occasioned by the presence upon the
leasehold or upon Lessor's property, negligence of willful conduct of either the
lessor, or lessee holding under the Lessee xxxxx, regardless of who the Injured
party may be.
5.2 LESSEE WILL OBTAIN PERMITS: [illedgable].
7
5.3 LIENS: Lessee agrees to keep the property described herein free and
clear of all liens and charges whatsoever. Lessee shall not allow any mechanic's
or other liens to be placed upon the leased premises. If such a lien is placed
of record, Loccoo shall cause it to be discharged of record, at its own expence,
within ten (10) days of Lessor's demand, Failure to comply with Lessor's demand
within 10 days shall be a default under the terms of this Lease.
5.4 INDEMNIFICATION AND HOLD HARMLESS: The Lessee agrees that it will
protect, save, defend, hold harmless and indemnify the Lessor, its officers,
employees and agents from any and all demands, claims, judgments, or liability
for loss or damage arising as a result of accidents, injuries, or other
occurrences, occasioned by either the negligent or willful conduct of the
Lessee, Its agents or any person or entity holding under the Lessee or any party
person or entity on the leasehold or on this Lessors property as a result of
Lessee's activity, regardless of who the injured party may be,
5.4.1 Lessee shall indemnify and hold lessor harmless from any and all
claims, demands, judgments, orders, or damages resulting from hazardous
substances on the leasehold caused in whole or in part by the activity of the
Lessee. Its agents, subtenants, or any rather person or entity on the leasehold
during any period of time that Lessee has occupied all or a portion of the
leasehold during the term of the lease. It is the Intent of the parties that
Lessee shall be responsible and shall hold Lessor harmless from any hazardous
substances that have or may occur on the leasehold since Lessee [illedgable].
The term "hazardous substances", as used herein, shall mean any substance
heretofore or hereafter designated as hazardous under the Resource Conservation
and Recovery Aot, [illedgable]. the comprehensivs [illedgable]; or the Hazardous
Waste Cleanup-Model Toxic Control Act, RCW 70.1O5D all as amended and subjcot to
all regulations promulgated thereunder.
5.5 LAWS AND REGULATIONS: LESSEE agrees to conform to and abide by all
lawful rules, codes, laws and regulations in connection with Its use of said
premises and the constrction of improvements and oparatron of Lessee's business
thereon and not to permit said premises to be used in violation of any lawful
rule, code, law, regulation or other authority.
5.5.1 The Lessor's obligations [illedgable].
8
5.6 WASTE AND REFUSE: Lessee agrees not to allow conditions of waste
and refuse to exist on the above described promises and to keep the promises in
a neat, clean and orderly condition and to be responsible for all damages reused
to the leased premises by Lessee, his agents or any third party on the premises.
5.7 TAXES AND ASSESSMENTS: Lessee agrees to pay all taxes assessed
against the leasehold interest and a prorata share of assessments made against
property for installation of public utility systems, based upon a reasonable
sharing program among all properties served by the same utility.
5.8 SIGNS: No signs shall by installed without the written permission
of Lessor.
5.9 EQUAL OPPORTUNITY: Lessee agrees that in the conduct of activities
on the leased premises It will be an equal opportunity employer in accordance
with Title VI of the 1964 Civil Rights Act and will comply with all requirements
of the Americans With Disabilities Act of 1990.
5.10 LITIGATION: In the event Lessor shall be made a party to any
litigation commenced by or against Lessee, then Lessee agrees to pay all costs,
expert witness fees, and attorney's fees, including all customary charges,
incurred by Lessor in connection with such litigation. However, if Lessor is
made a party defendant and Lessee undertakes the defense of the action on behalf
of Lessor, then no obligation for costs and attorney's fees will be chargeable
against Lessee by Lessor for costs arising out of such undertaking, Lessee also
agrees to pay all costs and attorney's fees incurred by Lessor In enforcing any
of the covenants, agreements, terms and provisions of this lease,
5.10.1 Notwithstanding the above paragraph, Lessor and Lessee agree
that in any litigation between them reasonable attorney fees and costs shall be
awarded only to the prevailing party,
5.11 ASIGNMENT OF LEASE: Lessee shall not assign, rentl or sublease any
portions of this lease or any extension thereof, without the prior written
consent of Lessor and no rights hereunder or in or to said premises shall pass
by operation of law or other judicial process or through insolvency
proceedings.[illedgable] successors, representatives and assigns
as the case may be. Lessee will furnish Lessor with [illedgable].
9
assignment made by the Lessee for the purposes of obtaining a loan or other
consideration from a third party, then the Lessor's consent shall be made in
accordance with the Consent to Assignment document used by Lessor for these
specific assignments. A copy of this consent form will be provided by Lessor
upon request of the Lessee.
5.11.1 If Lessor refuses to consent to an assignment, Lessee's sole
remedy shall be the right to bring a declaratory action to determine whether
Lessor was entitled to refuse such assignment under the terms of this lease.
5.11.2 A minimum handling and transfer fee of THREE HUNDRED and NO/100
DOLLARS ($300.00) shall be payable by Lessee to Lessor should a lease assignment
or subletting transpire. The Lessor reserves the right to increase the transfer
fee to Five Hundred Dollars ($500.00) if in Lessor's sole judgement the
transaction necessitates the expenditure of substantial time and expense on the
part of the Lessor.
5.12 REIMBURSEMENT FOR EXPENSES: Should the Lessee seek to assign this
lease to any creditor as security for a loan or forbearance from such creditor,
or attempt to otherwise assign, sublease, or modify this agreement between the
parties during the term of this lease or any renewal thereof, then the Lessee
agrees to reimburse the Lessor for all customary and reasonable attorney fees
paid by the Lessor for the review and opinion of such attorney acting on the
request. A failure to reimburse the Lessor within 60 days of the mailing of
notice of such charges shall constitute a default under the terms of this lease.
Notwithstanding anything to the contrary herein, the Lessee shall not be
obligated to reimburse the Lessor in any case where an assignment, sublease, or
modification is not accomplished due to total refusal on the part of the Lessor
to grant Its consent to the request.
5.13 TERMINATION: Upon termination of this lease or any extension
thereof, whether by expiration of the stated term or sooner termination thereon
as herein provided, Lessee will surrender to Lessor said premises peaceably and
quietly and in the same condition in which they existed prior to possession by
Lessee.
5.14 DEFAULT: Failure to pay rent by the first day of each month shall
constitute a default under the terms of this lease. If default in the payment of
rent occurs, then at Lessor's sole option, upon ten (10) days written notice,
this lease may be terminated and Lessor may enter upon and take possession of
said property. This remedy is in addition to and is not exclusive of any other
remedies provided either by this lease or by law.
if Lessee shall fail to perform any term or condition of this lease,
other than the payment of rent, then Lessor, upon providing Lessee thirty (30)
days written notice of such default, may terminate this lease and enter upon and
take possession of the property. This remedy is in addition to and is not
exclusive of any other remedies provided either by this lease or by law.
10
If within any one year period, Lessor serves upon the Lessee three
notices requiring Lessee to comply with the terms of the lease or to vacate the
leased premises, then Lessee shall, upon a subsequent violation of any term of
this lease by the Lessee, be deemed to be in unlawful detainer, and the Part
may, in addition to any other remedies it may have, immediately terminate the
lease and/or commence an unlawful detainer action without further notice to
Lessee.
5.14.1 The following shall also constitute default under the terms of
this lease: Insolvency of Lessee; an assignment by Lessee for the benefit of
creditors; the filing by Lessee of a voluntary petition in bankruptcy; an
adjudication that Lessee Is bankrupt or the appointment of a receiver of the
properties of Lessee; the filing of an involuntary petition of bankruptcy and
failure of Lessee to secure a dismissal of the petition within thirty (30) days
after filing; attachment of or the levying of execution on the leasehold
Interest; and failure of Losses to secure discharge of the attachment or release
of the levy of execution within ten r<10) days.
5.15 NON WAIVER: Neither the acceptance of rent nor any other act or
omission of Lessor after a default by Lessee shall operate as a waiver of any
past or future default by Lessee, or to deprive Lessor of its right to terminate
this lease, or be construed to prevent Lessor from promptly exercising any other
right or remedy it has under this lease.
5.16 NOTICES: Any notice, demand, request, consent, approval or
communication that either party desires or is required to give to the other
party shall be in writing addressed to the other party at the addresses as
follows:
TO LESSOR: PORT OF BELLINGHAM
0000 XXXXXX XXXXXX
P.O. 80X 1677
XXXXXXXXXX, XXXXXXXXXX 00000-0000
TO LESSEE: SAFE TRANSPORTATION SYSTEMS, INC.
0000 XXXXXXX XXX, XXXXX X
XXXXXXXXXX, XXXXXXXXXX 00000
or such address as may have been specified by notifying the other party of the
change of address, Notice shall be deemed served on the date of actual delivery
or the first attempted delivery as shown on the return receipt if mailed with
the United States Postal Service by certified mail, return receipt requested.
11
5.17 AGENT FOR SERVICIE: Lessee agrees that, if Lessee is in unlawful
datainer pursuant to RCW 59.12, and Lessor is unable to serve Lessee with the
unlawful detainer pleadings after one service attempt, then Lessor will be
deemed to have complied with the service requirements of ROW 59.12 if it mails
such pleadings via certified mail to the address set forth in the notice section
of this lease and posts such pleadings in a conspicuous location on the leased
premises. Service shall be deemed complete on the third day following the day of
posting or day of mailing, whichever is later.
5.18 QUIET ENJOYMENT: Lessor acknowledges that it has ownership of the
property heretofore described and that it has the legal authority to lease said
property unto Lessee. Lessor covenants that Lessee's right of occupancy shall
not be disturbed during the term of this lease so long as the terms are complied
with by Lessee and subject to that clause in this lease dealing with the right
of Lessor to enter upon the leased promises.
5.19 LESSOR MAY ENTER PRE MISES: It is agreed that the duly authorized
officers or agents of Lessor may enter to view said premises at any time and if
the business or normal function of Lessor should at any time require that it
enter upon the premises to perform any work or make any improvements, It may do
so, but not in such manner as to materially injure Lessee or interfere with its
normal and usual operation.
5.19.1 The Lessor reserves the right to grant easements and other land
uses on the premises to others when the easement or other land uses applied for
will not unduly interfere with the use to which the Lessee is putting the
premises, or interfere unduly with the approved plan of development for the
premises. No easement or other land uses shall be granted to third parties,
until damages to the leaseholder have been dealt with appropriately, or waiver
signed by the Lessee.
5.20 TIME: Tt is mutually agreed and understood that time is of the
essence of this lease and that a waiver of any default of Lessee shall not be
construed as a waiver of any other default.
5.21 INTERPRETATION:: In any dispute between the parties, the language
of this lease shall in all cases be construed as a whole according to its fair
meaning and not for or against either the Lessor or the Lessee. If any provision
Is found to be ambiguous, the language shall not be construed against either the
Lessor or Lessee solely on the basis of which party drafted the provision. If
any word, clause, sentence, or combination thereof for any reason Is declared by
a court of law or equity to be invalid or unenforceable against one party or the
other, then such finding shall in no way affect the remaining provisions of this
lease agreement.
12
5.22 HOLDING OVER: If the Lessee remains In possession of said promises
after the date of expiration of this lease, with the written consent of the
Lessor, it Is hereby agreed and understood that until such time as a new
agreement in writing shall be entered into between the parties thereto, Lessee
shall continue to make payments to Lessor on a month to month basis as provided
for in this Lease. Said holding over shall be subject to all of the terms and
conditions of this lease. Said holdover tenancy may be terminated by either
party at the and of any such monthly period by sending written notice not less
than five (5) days before the end of such period. Said holding over shall be
subject to approval of Lessor,
5.23 RIGHT OF FIRST REFSUAL - IS BUILDING: The Premises is a portion of
the Lessor's ITS Building, The balance of the ITB Buildinq is approximately
30,000 square feet. That area is currently leased to another tenant. In the
event that the other tenant terminates Its lease (and any renewals thereto) with
the Lessor, the Lessor shall notify Lessee (as provided herein) of the vacation.
After Lessor has provided notice as provided herein, the Lessee shall have sixty
(6O) days to notify the Lessor that it desires to lease the balance of the ITS
Building. If the Lessor is so notified, the Lessor shall prepare a modification
to this Lease which adds the balance of the ITS Building to this Lease, adjusts
the monthly rent to reflect the increased square footage and adjusts the amount
of the performance bond required.
5.24 OPTION TO PURCHASE ITB BUILDING: The Lessor hereby grants to
Lessee the option to purchase the ITS Building and all Lessor owned improvements
on the premises for its fair market value as determined by not less than the
average of two MAI appraisals. The option shall extend from the Commencement
Date of the Lease for a period of five years. The exercise of the option is
subject to the following conditions precedent:
a. The decision of the commission of the Port of Bellingham to declare
the ITS Building surplus to the needs of the Lessor. That decision shall be in
the sole discretion of the commission of the Part of Bellingham, Nothing herein
shall be construed as to require the commission to surplus the ITS Building.
b. The approval of the Federal Aviation Administration (or its
successor organization), If required.
c, Any and all leases and/or rental agreements In place for the ITS
Building.
5.24.1 The Lessor shall notify the Lessee that it intends to declare
the ITS Building surplus. Thereafter, the Lessee shall have thirty (30) days to
notify the Lessor that it intends to exercise the option. in the event that the
Lessee so notifies the Lessor of its intent to exercise the option, then the
Lessor and the Lessee shall each select an MAI appraiser who regularly performs
services in Whatcom County, Washington. The appraisers shall be instructed to
appraise the value of the real property only and the value of all of the Lessor
owned improvements on the premises. Not less than the average of the two
appraisals shall determine the fair market value of the real property and the
fair market value of the 1TS Building and all Lessor owned improvements on the
Premises.
13
5.24.2 Subject to approval of the commission decision to surplus the
ITS Building and the acceptance of the purchase price by the Lessee, the lessor
shall sell the 1TS Building and all Lessor owned Improvements on the Promises to
the Lessee for the fair market value as determined by the average of the two
appraisals. The Lessor shall lease the underlying real property to the Lessee
for a term of not less than forty (40) years at a rate that is then determined
by applying the Lessor's lease rate of return policies then in effect. The lease
shall provide for a renegotiation of the rent every five years.
5.24.3 The ITS Building and all Lessor owned improvements thereon shall
be sold by the Lessor to the Lessee via statutory warranty deed "as is(degree)"
"where is" without warranty of any kind. Further, the sale shall be subject to
all leases then In effect.
5.24.4 Each party shall bear the cost of its selected appraiser. The
parties shall split equally the cost of escrow services and the Lessor shall
purchase a standard policy of title insurance far the real property and
improvements located thereon. The Lessee shall be responsible for any real
estate excise taxes occasioned by this transaction.
5.25 RELOCATION TO OTHER LESSOR FACILITY: It Is anticipated by the
Lessee that it may outgrow the Premises provided for herein. Further, it is the
intent of the parties to negotiate in good xxxxx Xxxxxx'x potential construction
of a new facility to accommodate Lessee's expansion needs. Such new construction
shall be at the sole discretion of the commission of the Port of Bellingham. In
the event that the Lessee relocates to another Lessor owned facility (including
a facility constructed by Losses on Lessor owned land) then this Lease shall
automatically terminate subject to the Lessor's right to collect the total
amount of the cost of the tenant improvements from the Lessee.
5.28 SURVIVAL: All obligations of the Lessee as provided for in the
lease shall not cease upon the termination of this Lease and shall continue as
obligations until fully performed. All clauses of this Lease which require
performance beyond the termination date shall survive the termination date of
this Lease.
5.27 ENTIRE AGREEMENT: This lease contains all of the understandings
between the parties. Each party represents that no promises, representations or
commitments have been made by, the other as a basis far this agreement which
have not been reduced to writing herein. No oral promises or representations
shall be binding upon either party, whether made in the past or to be made in
the future, unless such promises or representations are reduced to writing in
the form of a modification to this lease executed with all necessary legal
formalities by the commission of the Port of Bellingham.
14
5.28 FACSIMILE TRANSMISSION This agreement may be executed by the
parties and transmitted by facsimile and, if so executed and transmitted, this
agreement will be for all purposes as effective as if the parties had delivered
an executed original agreement,
5.29 VALIDATION: IN WITNESS WHEREOF, Lessor has caused this instrument
to be signed by its President and Secretary by authority of the Port Commission
of the Port of Bellingham, and this instrument has been signed and executed by
Lessee, the day and year first above written.
SAFE TRANSPORTATION SYSTEMS, INC. PORT OF BELLINGHAM
[Signatures]
[Illedgable] [Illedgable]
------------ ------------
President President
[Illedgable] [Illedgable]
------------ ------------
V.P., Finance Secretary
LESSEE LESSOR
15
