OFFICE LEASE
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Exhibit
10.33
XXXXX BUILDING LLC
“LANDLORD”
WITH
VISUALANT INCORPORATED
“TENANT”
BUILDING: XXXXX BUILDING
SUITES: 810 and 815
DATED: December 13, 2016
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Table Of Contents
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Page
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SECTION 1: BASIC PROVISIONS
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1
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SECTION 2: PREMISES AND PREPARATION OF PREMISES
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2
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SECTION 3: TERM AND COMMENCEMENT
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2
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SECTION 4: BASE RENT AND ADDITIONAL RENT
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3
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SECTION 5: QUIET ENJOYMENT
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5
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SECTION 6: UTILITIES AND SERVICES
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5
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SECTION 7: DEPOSITS
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6
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SECTION 8: USE, COMPLIANCE WITH LAWS AND RULES
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7
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SECTION 9: MAINTENANCE AND REPAIRS
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7
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SECTION 10: ALTERATIONS AND LIENS
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8
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SECTION 11: INSURANCE AND WAIVER OF SUBROGATION
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8
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SECTION 12: CASUALTY DAMAGE
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9
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SECTION 13: CONDEMNATION
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10
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SECTION 14: ASSIGNMENT AND SUBLETTING
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10
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SECTION 15: PERSONAL PROPERTY, RENT AND OTHER TAXES
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11
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SECTION 16: TENANT’S DEFAULT; LANDLORD’S
REMEDIES
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12
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SECTION 17: SUBORDINATION, ATTORNMENT AND LENDER
PROTECTION
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13
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SECTION 18: ESTOPPEL CERTIFICATES
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14
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SECTION 19: RIGHTS RESERVED BY LANDLORD
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14
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SECTION 20: LANDLORD’S DEFAULT; REMEDIES
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15
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SECTION 21: RELEASE AND INDEMNITY
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16
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SECTION 22: RETURN OF POSSESSION
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16
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SECTION 23: HOLDING OVER
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17
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SECTION 24: NOTICES
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17
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SECTION 25: REAL ESTATE BROKERS
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17
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SECTION 26: NO WAIVER
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17
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SECTION 27: SAFETY AND SECURITY DEVICES, SERVICES AND
PROGRAMS
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18
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SECTION 28: TELECOMMUNICATION LINES AND EQUIPMENT
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18
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SECTION 29: HAZARDOUS SUBSTANCES; DISRUPTIVE
ACTIVITIES
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19
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SECTION 30: DISABILITIES ACTS
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19
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SECTION 31: DEFINITIONS
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20
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SECTION 32: OFFER
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21
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SECTION 33: MISCELLANEOUS
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21
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SECTION 34: ENTIRE AGREEMENT
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23
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i
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EXHIBIT A: LEGAL DESCRIPTION OF PROPERTY
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EXHIBIT B: FLOOR PLATE SHOWING PREMISES
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EXHIBIT C: WORK LETTER
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RIDER ONE: RULES
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RIDER TWO: GREEN ADDENDUM
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ii
THIS
OFFICE LEASE (“Lease”) is made and entered into as of
this 13th
day of December, 2016, by and between XXXXX BUILDING LLC, a
Delaware limited liability company (“Landlord”), and
VISUALANT INCORPORATED, a Nevada corporation
(“Tenant”). In consideration of this Lease, Landlord
and Tenant covenant and agree as follows:
SECTION
1: BASIC PROVISIONS
This
Section contains the basic lease provisions between Landlord and
Tenant.
A. Building:
000 Xxxxx Xxxxxx,
Xxxxxxx, Xxxxxxxxxx 00000 (“Building”), located on a
portion of the real property legally described in Exhibit A
attached hereto (“Property”).
B. Premises:
Suites 810 and 815
in the Building as identified in Exhibit B.
C. Commencement Date:
January 1, 2017,
subject to Section 3.
D. Expiration Date:
January 31, 2022,
subject to Section 3.
E. Rentable Area:
The rentable area
of the Premises shall be deemed to contain 943 rentable square feet
(“RSF”), subject to Section 31(O).
F. Tenant’s
Share:
00.80%, subject to
Section 4 and Section 31(O).
G. Base Rent:
From the
Commencement Date through the Expiration Date, as further described
in Section 4, as follows:
Months 1 –
12*:
$34.00/RSF/year
($2,671.83 per month)
Months 13 –
24:
$35.00/RSF/year
($2,750.42 per month)
Months 25 –
36:
$36.00/RSF/year
($2,829.00 per month)
Months 37 –
48:
$37.00/RSF/year
($2,907.58 per month)
Months 49 –
60:
$38.00/RSF/year
($2,986.17 per month)
Month
61:
$39.00/RSF/year
($3,064.75 per month)
*Tenant
shall be entitled to an abatement of Base Rent in the amount of
$2,671.83, which amount shall be credited against Base Rent for the
first calendar month of the Term.
H. Additional Rent:
Tenant shall pay
Tenant’s Share of Taxes and Tenant’s Share of Expenses
in excess of such amounts for the period September 1, 2016 –
August 31, 2017 (“Base Year”) as further described in
Section 4.
I. Permitted Use:
Executive and
administrative office use, subject to Section 8.
J. Deposits:
$5,070.00, which
Landlord already holds and will not be increased, and shall be
subject to Section 7.
K. Parking:
Tenants at the
Xxxxx Building may arrange for parking spaces at the neighboring US
Bank Center garage (“Garage”), subject to availability
of parking spaces within the Garage and payment of the
Garage’s then applicable monthly rate.
L. Broker (if any):
Xxxxx Driver of
Xxxxx Driver & Co., P.S., as Tenant's broker
Xxxxx
Xxxxxxxx, Xxxxx XxXxxxxxx and Xxxxx Xxxxx of Xxxxxxxxx Group, Inc.,
as Landlord's broker
M. Guarantor(s):
N/A.
N. Riders/Exhibits:
Exhibit A
(Property)
Exhibit
B (Premises)
Exhibit
C (Work Letter)
Rider
One (Rules)
Rider
Two (Green Addendum)
O. Landlord’s Notice Address (subject to
Section 24):
Xxxxx
Building LLC
c/o
Unico Properties LLC
Attn:
Senior Vice President / CFO
0000
Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX
00000
1
With a
copy to:
Xxxxx
Building LLC
c/o
Unico Properties LLC
Attn:
Xxxxx Building Property Manager
0000
Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX
00000
P. Tenant’s Notice Address (subject to
Section 24):
Visualant
Incorporated
Attn:
Office Manager
The
Xxxxx Building
000
Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX
00000
Q. Rent Payments:
Rent shall be paid
to the following, or to such other parties and addresses as to
which Landlord shall provide advance notice:
Xxxxx
Building LLC
c/o
Unico Properties LLC
Attn:
Accounts Receivable
0000
Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX
00000
The
foregoing provisions shall be interpreted and applied in accordance
with the other provisions of this Lease. The terms of this Section,
and the terms defined in Section 31 and other Sections, shall
have the meanings specified therefor when used as capitalized terms
in other provisions of this Lease or related documentation (except
as expressly provided to the contrary therein).
SECTION
2: PREMISES AND PREPARATION OF PREMISES
A. Premises.
Landlord hereby leases to Tenant and Tenant hereby leases from
Landlord the Premises subject to the provisions herein contained.
Tenant agrees to accept the Premises “as is” without
any agreements, representations, understandings or obligations on
the part of Landlord to construct any improvements within the
Premises other than the Tenant Improvements, if any, described in
Exhibit C, or to perform any repairs or maintenance to the Premises
or Building except as expressly provided under this Lease. Tenant
further acknowledges that, except as otherwise expressly stated in
this Lease, Landlord has not made any representation or warranty
(express or implied) with respect to the habitability, condition or
suitability of the Premises, Building or Property for
Tenant’s purposes or any particular purpose.
B. Preparation
of Premises. The obligations of Landlord and Tenant to
perform work and supply materials and labor to prepare the Premises
for Tenant’s occupancy shall be as set forth in
Exhibit C attached hereto and incorporated herein.
Landlord’s obligation, if any, for completion of the Premises
(“Landlord’s Work”) shall be defined and limited
by said Exhibit C, and Landlord shall not be required to furnish or
install any item not indicated thereon. Any additional alterations
or improvements to the Premises beyond those set forth on Exhibit C
shall be at Tenant’s sole cost and expense and subject to all
provisions of Section 10, including without limitation the prior
approval of Landlord. Taking possession of the Premises by Tenant
shall be conclusive evidence the Premises were, on that date, in
good, clean and tenantable condition and delivered in accordance
with this Lease, unless set forth otherwise in a mutually agreed
upon written “punch list.”
C. Governing
Property Documents. The Property is subject to and governed
by that First Amended and Restated Pacific First Center/Xxxxx
Building Agreement recorded under King County Recording No.
8704210116, as amended by any other amendments thereto hereafter
adopted (collectively, “Governing Property Documents”).
Tenant’s use of the Premises, Property and Common Areas, and
rights and interest in this Lease, all are subject to the Governing
Property Documents, and Tenant shall be responsible for complying
with those requirements in the Governing Property Documents
applicable to Tenant’s use of the Premises. Additions and
modifications to Governing Property Documents shall be binding on
Tenant upon delivery of a copy of them to Tenant.
SECTION
3: TERM AND COMMENCEMENT
A. Term
and Confirmation. The term (“Term”) of this
Lease shall commence on the Commencement Date and end on the
Expiration Date as specified in Section 1 above, unless sooner
terminated as provided herein, subject to adjustment as provided
below and the other provisions hereof. If the Commencement Date is
advanced or postponed as provided below, the Expiration Date set
forth in Section 1 shall not be changed, unless Landlord so elects
by notice to Tenant. Tenant shall execute a confirmation of the
Commencement Date and other matters in such form as Landlord may
reasonably request within ten (10) days after requested (but
nothing herein shall require Landlord to so request); any failure
to respond within such time shall be deemed an acceptance of the
matters as set forth in Landlord’s confirmation. If Tenant
disagrees with Landlord’s adjustment of the Commencement
Date, Tenant shall pay Rent and perform all other obligations
commencing on the date determined by Landlord, subject to refund or
credit when the matter is resolved.
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B. Adjustments
to Commencement Date. The parties acknowledge that the
Commencement Date specified in Section 1 is an estimated date. This
Lease shall commence on the Commencement Date specified in Section
1 if Landlord’s Work is Substantially Complete (as that term
is defined in Exhibit C) by such date but otherwise the
Commencement Date shall be adjusted to be the first to occur of the
following events: (i) the date Landlord provides Tenant notice that
Landlord’s Work is Substantially Complete; (ii) the date on
which Tenant takes possession or commences beneficial occupancy of
the Premises; or (iii) if Substantial Completion of
Landlord’s Work is delayed in whole or in part due to Tenant
Delay (as that term is defined in Exhibit C), then the date
determined by Landlord as the date upon which Landlord’s Work
would have been Substantially Complete, but for Tenant’s acts
or omissions. In no event shall Landlord have any liability for
loss or damage to Tenant resulting in any delay in the Commencement
Date, nor shall Tenant have any right to terminate this Lease, and
Tenant’s sole recourse shall be the postponement of Rent and
other obligations until the Commencement Date is established as set
forth above.
C. Early
Access. If Landlord’s Work is Substantially Complete
prior to the Commencement Date specified in Section 1, upon
reasonable notice from Tenant to Landlord, Tenant shall be entitled
to enter the Premises for fixturing and move in purposes provided
(i) Tenant shall not interfere with Landlord’s completion of
Landlord’s Work and shall coordinate its activities and
comply with Landlord’s directives, (ii) all provisions
of this Lease other than those relating to payment of Rent shall
apply to any such pre-commencement entry (including without
limitation all insurance, indemnity and freedom from lien
provisions), and (iii) Tenant shall not beneficially occupy the
Premises (or any part thereof) or commence business operations from
the Premises (or any part thereof) during such period.
SECTION
4: BASE RENT AND ADDITIONAL RENT
A. Base
Rent. Subject to adjustment for expenses, taxes and required
capital expenditures as set forth in this Section 4, Tenant shall
pay Landlord the monthly Base Rent set forth in Section 1 in
advance on or before the first day of each calendar month during
the Term. The Base Rent for any fractional month occurring prior to
the Rent Abatement Period and for the first full month of the Lease
Term which occurs after the expiration of the Rent Abatement Period
shall be paid by Tenant at the time of Tenant’s execution of
this Lease.
B. Taxes
and Expenses. Tenant shall pay Landlord
“Tenant’s Share of Taxes” and
“Tenant’s Share of Expenses” in the manner
described below. All such charges shall be deemed to constitute
“Additional Rent” which shall be deemed to accrue
uniformly during the calendar year in which the payment is
due.
(i) During each
calendar year after the Base Year identified in Section 1(H) above,
Tenant agrees to pay as “Additional Rent” for the
Premises, “Tenant’s Share” (defined below) of all
increases in Taxes and Expenses incurred by Landlord in the
operation of the Building and Property, over the amount of the
Property Taxes and Expenses incurred by Landlord in the operation
of the Building and Property during the Base Year. For purposes of
this Lease, “Tenant’s Share” shall mean the ratio
between the rentable area of the Premises and the rentable area of
the Building. Tenant’s Share, calculated based on the initial
square foot area of the Premises, is set forth in Section 1(F)
above, and is subject to adjustment as set forth in Section
31(O).
(ii) Prior
to or promptly after the commencement of each calendar year
following the Base Year, Landlord shall give Tenant a written
estimate of the anticipated increases in Taxes and Expenses over
the Base Year and Tenant’s Share of such increases. Tenant
shall pay such estimated amount to Landlord in equal monthly
installments, in advance, without deduction or offset, on or before
the first day of each calendar month, with the monthly installment
of Base Rent payable in accordance with Section 4(A) above. After
the end of each calendar year, Landlord shall furnish to Tenant a
statement showing in reasonable detail the actual increases over
the Base Year in the Taxes and Expenses incurred by Landlord during
the applicable calendar year and Tenant’s Share thereof. If
the statement shows Tenant’s Share of the actual increases
exceeds the amount of Tenant’s estimated payments, within
thirty (30) days after receiving the statement, Tenant shall pay
the amount of the deficiency to Landlord. If the statement shows
Tenant has overpaid, the amount of the excess shall be credited
against installments next coming due under this Section 4;
provided, however upon the expiration or earlier termination of the
Lease Term, if Tenant is not then in default under this Lease,
Landlord shall refund the excess to Tenant.
(iii) If
at any time during any calendar year of the Lease Term (other than
the Base Year) the Taxes applicable to the Building and Property
change and/or any information used by Landlord to calculate the
estimated Expenses changes, Tenant’s estimated share of such
Taxes and/or Expenses, as applicable, may be adjusted accordingly
effective as of the month in which such changes become effective,
by written notice from Landlord to Tenant of the amount or
estimated amount of the change, the month in which effective, and
Tenant’s Share thereof. Tenant shall pay such increase to
Landlord as a part of Tenant’s monthly payments of estimated
Taxes or Expenses as provided above, commencing with the month
following the month in which Tenant is notified of the
adjustment.
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(iv) For
purposes of this Lease, the term “Expenses” means all
costs of and expenses paid or incurred by Landlord for maintaining,
operating, repairing, replacing and administering the Building and
Property, including all Common Areas and facilities and Systems and
Equipment, and shall include the following costs by way of
illustration but not limitation: water and sewer charges; insurance
premiums; license, permit, and inspection fees; heat; light; power;
steam; janitorial and security services; labor; salaries; air
conditioning; landscaping; maintenance and repair of driveways and
surface areas; supplies; materials; equipment; tools; the cost of
capital replacements (as opposed to capital improvements); the cost
of any capital improvements or modifications made to the Building
by Landlord that are intended to reduce Expenses, are required
under any Laws not applicable to the Building or Property or not in
effect at the time the Building was constructed, or are made for
the general benefit and convenience of all tenants of the Building;
all property management costs, including office rent for any
property management office and professional property management
fees; legal and accounting expenses; and all other expenses or
charges which, in accordance with industry standard accounting and
management practices, would be considered an expense of
maintaining, operating, repairing, replacing or administering the
Building or Property. Capital costs included in Expenses shall be
amortized over such reasonable period as Landlord shall determine
with a return on capital at the current market rate per annum on
the unamortized balance or at such higher rate as may have been
paid by Landlord on funds borrowed for the purpose of constructing
such capital replacements or improvements.
(v) For purposes of
this Lease, the term “Taxes” means all real estate
taxes or personal property taxes and other taxes, surcharges and
assessments, unforeseen as well as foreseen, which are levied with
respect to the Building and Property and any improvements, fixtures
and equipment and other property of Landlord, real or personal,
located in the Building or on the Property and used in connection
with the operation of the Building or Property and any tax,
surcharge or assessment which shall be levied in addition to or in
lieu of real estate or personal property taxes, other than taxes
covered in Section 15. The term “Taxes” shall also
include any rental, excise, sales, transaction, privilege, or other
tax or levy, however denominated, imposed upon or measured by the
rental reserved hereunder or on Landlord’s business of
leasing the Premises, excepting only net income, inheritance, gift
and franchise taxes.
(vi) Notwithstanding
anything to the contrary contained above, as to each specific
category of expense which one or more tenants of the Building, at
Landlord’s sole discretion, either pays directly to third
parties or specifically reimburses to Landlord (e.g., separately
metered utilities, separately contracted janitorial service,
property taxes directly reimbursed to Landlord, etc.) such
tenant(s) payments with respect thereto shall not be included in
Expenses for purposes of this Section 4, but Tenant’s Share
of each of such category of expense shall be adjusted by excluding
from the denominator thereof the rentable area of all such tenants
paying such category of expense directly to third parties or
reimbursing the same directly to Landlord. Tenant shall not enter
into separate contracts to provide any specific utility or service
normally provided by the Building, without Landlord’s prior
written consent in Landlord’s sole discretion. Moreover, if
Tenant pays or directly reimburses Landlord for any such category
of expense (which shall only be Landlord’s prior consent),
such category of expense shall be excluded from the determination
of Expenses for Tenant to the extent such expense was incurred with
respect to space in the Building actually leased to or occupied by
other Tenants.
(vii) Notwithstanding
anything to the contrary contained above, Landlord shall have the
right, from time to time, to equitably allocate some or all of the
Expenses among different portions or occupants of the Building
(“Cost Pools”), in good faith and in its reasonable
discretion. Such Cost Pools may include, but shall not be limited
to, the office space tenants of the Building, and the retail space
tenants of the Building. The Expenses within each such Cost Pool
shall be allocated and charged to the tenants within such Cost Pool
reasonably, in good faith and in an equitable manner.
(viii) If
the average occupancy of the Building is less than ninety-five
percent (95%) during any calendar year, Landlord will, in
accordance with industry standard accounting and management
practices, determine the amount of variable Taxes and Expenses
(i.e. those items which vary according to occupancy levels) that
would have been paid had the Property been ninety-five percent
(95%) occupied, and the amount so determined shall be deemed to
have been the amount of Taxes and Expenses for such
year.
C. Prorations.
If the Term commences on a day other than the first day of a
calendar month or ends on a day other than the last day of a
calendar month, the Base Rent and any other amounts payable on a
monthly basis shall be prorated on a per diem basis for such
partial calendar months. If the Base Rent is scheduled to increase
under Section 1 other than on the first day of a calendar month,
the amount for such month shall be prorated on a per diem basis to
reflect the number of days of such month at the then current and
increased rates, respectively. If the Term commences other than on
January 1, or ends other than on December 31, Tenant’s
obligations to pay amounts under this Section 4 towards Taxes and
Expenses for such first or final calendar years shall be prorated
on a per diem basis to reflect the portion of such years included
in the Term.
D. Payments
After Lease Term Ends. Tenant’s obligations to pay its
share of Taxes and Expenses (or any other amounts) as provided in
this Lease accruing during, or relating to, the period prior to
expiration or earlier termination of this Lease, shall survive such
expiration or termination. Landlord may reasonably estimate all or
any of such obligations within a reasonable time before, or anytime
after, such expiration or termination. Tenant shall pay the full
amount of such estimate, and any additional amount due after the
actual amounts are determined, in each case within ten (10) days
after Landlord sends a statement therefor. If the actual amount is
less than the amount Tenant pays as an estimate, Landlord shall
refund the difference within thirty (30) days after such
determination is made.
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E. Landlord’s
Accounting Practices and Records. Unless Tenant takes
exception by notice to Landlord within thirty (30) days after
Landlord provides any statement to Tenant for any item of
Additional Rent, such statement shall be considered final and
binding on Tenant (except as to additional Expenses or Taxes not
then known or omitted by error). If Tenant takes exception by
notice within such time, Landlord may seek confirmation from
Landlord’s independent certified public accountant as to the
proper amount of Taxes and Expenses determined in accordance with
sound accounting practices. In such case: (i) such confirmation
shall be considered final and binding on both parties (except as to
additional expenses or taxes not then known or omitted by error),
and (ii) Tenant shall pay Landlord for the cost of such
confirmation, unless it shows that Taxes and Expenses were
overstated by at least five percent (5%). Pending resolution of any
such exceptions, Tenant shall pay all amounts shown on such
Landlord’s statement, subject to credit, refund or additional
payment after any such exceptions are resolved.
F. General
Payment Matters. Base Rent, Additional Rent which includes
without limitation Tenant’s Share of Taxes, Tenant’s
Share of Expenses and any other amounts which Tenant is or becomes
obligated to pay Landlord under this Lease or other agreement
entered in connection herewith, are sometimes herein referred to
collectively as “Rent,” and all remedies applicable to
the nonpayment of Rent shall be applicable thereto. Rent shall be
paid in good funds and legal tender of the United States of America
without prior demand, deduction, recoupment, set-off or
counterclaim, and without relief from any valuation or appraisement
Laws. Rent obligations hereunder are independent covenants. In
addition to all other Landlord remedies (i) any Rent not paid by
Tenant when due shall accrue interest from the due date at the
Default Rate until payment is received by Landlord and (ii) in
addition to such interest, Tenant shall pay Landlord a service
charge of two hundred fifty dollars ($250.00) or five percent (5%)
of the delinquent amount, whichever is greater, if any portion of
Rent is not received within five (5) business days after the due
date. No delay by Landlord in providing any Rent statement to
Tenant shall be deemed a default by Landlord or a waiver of
Landlord’s right to require payment of Tenant’s
obligations hereunder including those for actual or estimated
taxes, expenses or capital expenditures. In no event shall a
decrease in Taxes or Expenses, below their respective Base Year
levels, ever decrease the monthly Base Rent or give rise to a
credit in favor of Tenant. Landlord may apply payments received
from Tenant to any obligations of Tenant then accrued, without
regard to such obligations as may be designated by
Tenant.
SECTION
5: QUIET ENJOYMENT
Landlord agrees
that if Tenant timely pays the Rent and performs the terms and
provisions hereunder, Tenant shall hold the Premises during the
Term, free of lawful claims by any party acting by or through
Landlord, subject to all other terms and provisions of this
Lease.
SECTION
6: UTILITIES AND SERVICES
A. Standard
Landlord Utilities and Services. Provided Tenant is not in
default of this Lease, Landlord shall provide Tenant the following
utilities and services:
(i) Elevator service
during Normal Business Hours and the service of at least one
elevator during all other hours.
(ii) Heating
and cooling to maintain a temperature condition which in
Landlord’s judgment provides for comfortable occupancy of the
Premises under normal business operations during Normal Business
Hours, but not Saturdays, Sundays or those legal holidays generally
observed in the State of Washington, provided Tenant complies with
Landlord’s instructions regarding use of window coverings and
thermostats and Tenant does not utilize heat generating machines or
equipment which affect the temperature otherwise maintained by the
air cooling system. Upon request Landlord shall make available at
Tenant’s expense after-hours heat or air cooling. The minimum
use of after-hours heat or air cooling and the cost thereof shall
be determined by Landlord and confirmed in writing to Tenant, as
the same may change from time to time.
(iii) Water
for drinking, lavatory, and toilet purposes.
(iv) Electricity
for building-standard overhead office lighting fixtures, and
equipment and accessories customary for offices (up to 280 hours
per month), where: (a) the connected electrical load of all of the
same does not exceed an average of 4 xxxxx per usable square foot
of the Premises (or such lesser amount as may be available, based
on the safe and lawful capacity of the electrical circuit(s) and
facilities serving the Premises), (b) the electricity is at nominal
120 volts, single phase (or 110 volts, depending on available
service in the Building), and (c) the systems and equipment are
suitable, the safe and lawful capacity thereof is not exceeded, and
sufficient capacity remains at all times for other existing and
future tenants, as determined in Landlord’s reasonable
discretion.
(v) Janitorial service.
Janitorial service as customary for comparable buildings within the
market which includes vacuum cleaning of carpets and cleaning of
Building standard vinyl composition tile, but no other services
with respect to carpets or nonstandard floor
coverings.
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(vi) Maintain
the windows, doors, floors and walls (exclusive of coverings),
ceilings, plumbing and plumbing fixtures, and electrical
distribution system and lighting fixtures in good condition and
repair, except for damage caused by Tenant, its employees, agents,
invitees or visitors, except that such service will not be provided
as to any of the foregoing items that are not standard for the
Building.
(vii) Replacement
of burned out fluorescent lamps in light fixtures which are
standard for the Building. Burned out lamps or other light sources
in fixtures which are not standard for the Building will be
replaced by Landlord at Tenant’s expense.
B. Interruptions.
Landlord shall use reasonable diligence to remedy an interruption
in the furnishing of such services and utilities. If, however, any
governmental authority imposes regulations, controls or other
restrictions upon Landlord or the Building which would require a
change in the services provided by Landlord under this Lease,
Landlord may comply with such regulations, controls or other
restrictions, including without limitation, curtailment, rationing
or restrictions on the use of electricity or any other form of
energy serving the Premises. Tenant will cooperate and do such
things as are reasonably necessary to enable Landlord to comply
with such regulations, controls or other restrictions.
C. Non-Standard
Usage. Whenever heat generating machines or equipment or
lighting other than building standard lights are used in the
Premises by Tenant which affect the temperature otherwise
maintained by the air cooling system, Landlord shall have the right
to install supplementary air cooling units in the Premises, and the
cost thereof, including the cost of installation and the cost of
operation and maintenance thereof, shall be paid by Tenant to
Landlord upon billing by Landlord. Landlord may impose a reasonable
charge for utilities and services, including without limitation,
air cooling, electric current and water, required to be provided
the Premises by reason of (a) any substantial recurrent use of the
Premises at any time other than during Normal Business Hours (b)
any use beyond what Landlord agrees to furnish as described above,
(c) electricity used by equipment designated by Landlord as high
power usage equipment or (d) the installation, maintenance, repair,
replacement or operation of supplementary air cooling equipment,
additional electrical systems or other equipment required by reason
of special electrical, heating, cooling or ventilating requirements
of equipment used by Tenant at the Premises. High power usage
equipment includes without limitation, data processing machines,
punch card machines, computers and machines which operate on
220-volt circuits. Tenant shall not install or operate high power
usage equipment on the Premises without Landlord’s prior
written consent, which may be refused unless (i) Tenant confirms in
writing its obligation to pay the additional charges necessitated
by such equipment and such equipment does not adversely affect
operation of the Building, and (ii) the Building electrical
capacity to the floor(s) containing the Premises will not be
exceeded. At Landlord’s option, separate meters for such
utilities and services may be installed for the Premises and Tenant
upon demand therefor, shall immediately pay Landlord for the
installation, maintenance, repair and replacement of such
meters.
D. Limitation.
Landlord does not warrant that any of the services and utilities
referred to in this Section 6 will be free from interruption.
Interruption of services and utilities shall not be deemed an
eviction or disturbance of Tenant’s use and possession of the
Premises or any part thereof or render Landlord liable to Tenant
for damages or loss of any kind, or relieve Tenant from performance
of Tenant’s obligations under this Lease.
E. Utility
Providers. Notwithstanding anything to the contrary in this
Lease, Landlord shall have the sole, exclusive and absolute right
to determine, select and contract with utility company or companies
that will provide electricity and other basic utility service to
the Building, Property and Premises. If permitted by Law, during
the Term of this Lease, Landlord shall have the right at any time,
and from time to time, to either contract for services from a
different company or companies providing electricity or other basic
utility service (each such company hereinafter an “Alternate
Service Provider”) or continue to contract for service from
the service provider(s) that is providing such utility service to
the Building, Property or Premises at the Commencement Date (each
the “Existing Service Provider”). Tenant shall
cooperate with Landlord, the Existing Service Provider and any
Alternate Service Provider at all times and, as reasonably
necessary, shall allow Landlord, the Existing Service Provider and
any Alternate Service Provider access to the Building’s
utility lines, plumbing, feeders, risers, wiring, and any other
machinery or utility access ways within the Premises.
SECTION
7: DEPOSITS
A. Security
Deposit. Upon execution of this Lease, Tenant shall deposit
a security deposit in the amount set forth in Section 1 with
Landlord. If Tenant is in default, Landlord can use the security
deposit or any portion of it to cure the default or to compensate
Landlord for any damages sustained by Landlord resulting from
Tenant’s default. Upon demand, Tenant shall immediately pay
to Landlord a sum equal to the portion of the security deposit
expended or applied by Landlord to restore the security deposit to
its full amount. In no event will Tenant have the right to apply
any part of the security deposit to any Rent or other sums due
under this Lease. If Tenant is not in default at the expiration or
termination of this Lease, Landlord shall return the security
deposit to Tenant. Landlord’s obligations with respect to the
deposit are those of a debtor and not of a trustee, and Landlord
can commingle the security deposit with Landlord’s general
funds. Landlord shall not be required to pay Tenant interest on the
deposit. Landlord shall be entitled to immediately endorse and cash
Tenant’s prepaid deposit; however, such endorsement and
cashing shall not constitute Landlord’s acceptance of this
Lease. In the event Landlord does not accept this Lease, Landlord
shall return said prepaid deposit. In addition, Tenant hereby
grants to Landlord a security interest in all of Tenant’s
tangible personal property and fixtures located at the Premises,
and in all of Tenant’s intangible property used in regard to,
or arising from, business conducted at or from the Premises,
including but not limited to all equipment, inventory, accounts,
furniture, trade fixtures, instruments, general intangibles and all
other rights to payment, and the proceeds and products therefrom,
and all after acquired property. This Security Agreement and this
grant of a security interest is given to secure Tenant’s
performance and payment of all Rent and all other obligations of
Tenant to Landlord under this Lease. Tenant hereby appoints
Landlord as its attorney-in-fact for the limited purpose of
preparing, executing and filing on Tenant’s behalf all
appropriate UCC financing statements Landlord deems reasonably
necessary to perfect the security interest granted Landlord
hereunder, all without further notice to Tenant.
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SECTION
8: USE, COMPLIANCE WITH LAWS AND RULES
A. Use
of Premises and Compliance With Laws. Tenant shall use the
Premises solely for the purposes set forth in Section 1 and for no
other purpose without obtaining the prior written consent of
Landlord, which shall not be unreasonably withheld for uses
consistent with Landlord’s then existing use criteria for the
Building. Tenant acknowledges that neither Landlord nor any agent
of Landlord has made any representation or warranty with respect to
the Premises or with respect to the suitability of the Premises or
the Building for the conduct of Tenant’s business, nor has
Landlord agreed to undertake any modification, alteration or
improvement to the Premises or the Building, except as provided in
writing in this Lease. Tenant acknowledges that Landlord may from
time to time, at its sole discretion, make such modifications,
alterations, repairs, deletions or improvements to the Building or
Property as Landlord may deem necessary or desirable, without
compensation or notice to Tenant, provided that such alterations,
repairs, deletions or improvements shall not materially adversely
affect Tenant’s use of the Premises during Normal Business
Hours and in no event shall Landlord be liable for any
consequential damages. Tenant shall promptly comply with all Laws
affecting the Premises and the Building, as well as the Rules
(defined below), and to any reasonable modifications to the Rules
as Landlord may adopt from time to time. Tenant acknowledges that,
except for Landlord’s obligations pursuant to Sections 9 and
30, Tenant is solely responsible for ensuring that the Premises
comply with any and all Laws applicable to Tenant’s use of
and conduct of business on the Premises, and that Tenant is solely
responsible for any alterations or improvements that may be
required by such Laws, now existing or hereafter adopted. Tenant
shall not do or permit anything to be done in or about the Premises
or bring or keep anything in the Premises that will in any way
increase the premiums paid by Landlord on its insurance related to
the Building or which will in any way increase the premiums for
fire or casualty insurance carried by other tenants in the
Building. Tenant will not perform any act or carry on any practices
that may injure the Premises or the Building that may be a nuisance
or menace to other tenants in the Building or that shall in any way
interfere with the quiet enjoyment of such other tenants. Tenant
shall not do anything on the Premises which will overload any
existing parking or service to the Premises.
B. Rules.
Tenant shall comply with the Rules set forth in Rider One attached
hereto (the “Rules”) in addition to all other terms of
this Lease. Landlord shall have the right, by notice to Tenant or
by posting at the Building, to reasonably amend such Rules and
supplement the same with other reasonable Rules relating to the
Building or Property, or the promotion of safety, care, efficiency,
cleanliness or good order therein. Nothing herein shall be
construed to give Tenant or any other Person any claim, demand or
cause of action against Landlord arising out of the violation of
such Rules by any other tenant or visitor of the Building or
Property, or out of the enforcement, modification or waiver of the
Rules by Landlord in any particular instance.
SECTION
9: MAINTENANCE AND REPAIRS
Unless
expressly provided otherwise in this Lease, and in addition to the
provisions of Section 6(A)(vi), Landlord shall maintain, in good
condition, the Common Areas of the Building, the structural parts
of the Building which shall include only the foundations, bearing
and exterior walls, subflooring, gutters, downspouts, and the roof
of the Building and the Building Systems and Equipment; provided,
in the event any such replacements, repairs or maintenance are
caused by or result from Tenant’s excessive or improper use
or occupation thereof or which are caused by or result from the
negligence or improper conduct of Tenant, its agents, employees or
invitees, the cost of such repairs shall be paid solely by Tenant
and Tenant shall pay the cost thereof within ten (10) days of
notice from Landlord. Except as provided above, and subject to
Section 10 of this Lease, Tenant shall maintain and repair the
Premises in neat, clean, sanitary and good condition, including,
without limitation, maintaining and repairing all walls,
storefronts, ceilings, interior and exterior doors, exterior and
interior windows and fixtures, Premises’ specific systems and
equipment, and interior plumbing serving the Premises as well as
any damage to the Building, Property or Premises caused by Tenant,
its agents, employees or invitees. If Tenant shall fail to keep and
preserve the Premises in said condition and state or repair,
Landlord may, at its option (but with no obligation) put or cause
the same to be put into the condition and state of repair agreed
upon, and in such case Tenant, on demand, shall pay the cost
thereof.
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SECTION
10: ALTERATIONS AND LIENS
A. Alterations.
Subsequent to the completion of any Landlord’s Work pursuant
to Section 2, Tenant shall not attach any fixtures, equipment or
other items to the Premises, or paint or make any other additions,
changes, alterations, repairs or improvements (collectively
hereinafter “alterations”) to the Premises, Building or
Property without Landlord’s prior written consent, which with
respect to alterations to the Premises will not be unreasonably
withheld so long as Tenant is not then, nor has been, in default of
this Lease (beyond any applicable cure period). If Landlord
consents to any alteration, Landlord may post notices of
nonresponsibility in accordance with Law. Any alterations so made
shall remain on and be surrendered with the Premises upon
expiration or earlier termination of this Lease, except that
Landlord may, within thirty (30) days before or thirty (30) days
after expiration or earlier termination hereof elect to require
Tenant to remove any or all alterations at Tenant’s sole
costs and expense. At the time Tenant submits plans for requested
alterations to Landlord for Landlord’s approval, Tenant may
request Landlord to identify which alterations Landlord may require
Tenant to remove at the termination of or expiration of this Lease,
and Landlord shall make such identification simultaneous with its
approval (if any) of the alterations. If Landlord elects to require
removal of alterations, then at its own and sole cost Tenant shall
restore the Premises to the condition designated by Landlord in its
election, before the last day of the term or within thirty (30)
days after notice of its election is given, whichever is
later.
B. Performance.
In the event Landlord consents in writing to Tenant’s
requested alteration of the Premises, Tenant shall only contract
with a contractor approved by Landlord for the construction of such
alterations, shall secure all appropriate governmental approvals
and permits and shall complete such alterations with due diligence,
in a neat, clean, good and workmanlike manner and in strict
compliance with the plans and specifications approved by Landlord.
All such construction shall be performed in a manner which shall
not interfere with the occupancy of the other tenants of the
Building. All cost, expenses and fees related to or arising from
construction of any alteration shall be paid by Tenant prior to
delinquency. There shall also be included within the cost of any
such alteration work (whether for initial tenant improvements or
for any subsequent alteration) a fee to Landlord for Tenant’s
use of Landlord’s personnel involved in the supervision,
coordination, inspection and the like pertaining to such work. Said
fee shall be ten percent (10%) of the total cost of the alteration
work (including costs of plans and permits), plus Landlord’s
out-of-pocket costs (if any), which shall be paid by Tenant within
ten (10) days after presentment by Landlord of an invoice therefor.
Landlord may impose additional reasonable conditions and rules
respecting the manner and times in which such alteration work may
be performed.
C. Liens.
Tenant shall pay all costs for alterations when due. Tenant shall
keep the Property, Building, Premises and this Lease free from any
mechanic’s, materialman’s, architect’s,
engineer’s or similar liens or encumbrances, and any claims
therefor, or stop or violation notices, in connection with any
alteration. Tenant shall remove any such claim, lien or
encumbrance, or stop or violation notices of record, by bond or
otherwise within ten (10) days after notice by Landlord. If Tenant
fails to do so, such failure shall constitute a default by Tenant,
and Landlord may, in addition to any other remedy, pay the amount
(or any portion thereof) or take such other action as Landlord
deems necessary to remove such claim, lien or encumbrance, or stop
or violation notices, without being responsible for investigating
the validity thereof. The amount so paid and costs incurred by
Landlord shall be deemed additional Rent under this Lease payable
upon demand, without limitation as to other remedies available to
Landlord. Landlord may, in its discretion, require Tenant to obtain
a lien and completion bond or some alternate form of security
satisfactory to Landlord in an amount sufficient to ensure the
lien-free completion of such alterations and naming Landlord as a
co-obligee. Nothing contained in this Lease shall authorize Tenant
to do any act which shall subject Landlord’s title to, or any
Lender’s interest in, the Building, Property or Premises to
any such claims, liens or encumbrances, or stop or violation
notices, whether claimed pursuant to statute or other Law or
express or implied contract.
D. Construction
Insurance. In addition to the requirements of Section 11
below, in the event that Tenant makes any alterations, prior to the
commencement of such alterations, Tenant shall provide Landlord
with evidence that Tenant or its general contractor, as
appropriate, carries “Builder’s All Risk”
insurance or its equivalent in an amount approved by Landlord
covering the construction of such alterations, and such other
insurance as Landlord may reasonably require, it being understood
and agreed that all of such alterations shall be insured by Tenant
pursuant to Section 10 of this Lease immediately upon completion
thereof.
SECTION
11: INSURANCE AND WAIVER OF SUBROGATION
A. Insurance.
During the term of this Lease, Tenant, at its sole cost and
expense, shall continuously maintain the following types of
insurance coverages: (i) All Risk or Causes of Loss - Special Form property
insurance, including fire and extended coverage, sprinkler leakage,
vandalism, malicious mischief, wind and flood coverage, covering
full replacement value of all of Tenant’s personal property,
trade fixtures and improvements and alterations in and to the
Premises, with coverages that also include “Business
Personal Property” and “Business Income Coverage”
covering at least one year of anticipated income; (ii)
both worker’s compensation
insurance to the applicable statutory limit, if any, and
employer’s liability insurance to the limit of $1,000,000 per
occurrence; (iii) commercial general liability insurance (occurrence
based) insuring Tenant against any liability arising out of its
use, occupancy or maintenance of the Premises or Building, or the
business operated by Tenant pursuant to the Lease, and providing
coverage for death, bodily injury and disease, property damage or
destruction (including loss of use), products and completed
operations liability, contractual liability which includes all of
Tenant’s indemnity obligations under this Lease (and
the certificate evidencing Tenant’s insurance coverage shall
state that the insurance includes the liability assumed by Tenant
under this Lease), fire legal
liability and advertising injury liability damage with a combined
single limit of no less than $5,000,000 (or in the alternative a primary policy combined
single limit of $2,000,000 with an Excess Limits (Umbrella) Policy
in the amount of no less than $3,000,000); and
(iv) Business Automobile Liability Insurance for Tenant owned
vehicles (only) in the amount of $1,000,000 combined single limit
(property damage and liability). The amount of any deductible or
self-insured retention for the coverages described in (i) and (iii)
shall not exceed Five Thousand Dollars ($5,000.00), and any
deductible or self-insurance provisions under any other insurance
policies required to be maintained by Tenant shall be subject to
Landlord’s prior written approval, such approval not to be
unreasonably withheld.
8
B. Additional
Requirements.
(i) All
insurance required to be carried by Tenant hereunder shall include
the following provisions: (a) shall name Landlord, Landlord's
property manager, and Landlord’s lender (if any) as
additional insureds; (b) shall release Landlord (and its
property manager and lender, if any) from any claims for damage to
business or to any person or the Premises, the Building and the
Property and to Tenant’s fixtures, personal property,
improvements and alterations in or on the Premises, caused by or
resulting from risks insured against under any insurance policy
carried by Tenant in force at the time of such damage;
(c) shall be issued by Insurance companies authorized to do
business in the State of Washington, with policyholder ratings not lower than
“A-” and financial ratings not lower than
“VII” in Best’s Insurance Guide (latest edition
in effect as of the date of this Lease and subsequently in effect
as of the date of renewal of the required policies);
(d) Shall be issued as (and separately endorsed as) a primary
and noncontributory policy as such policies apply to Landlord
(except for workers compensation); and (e) Shall contain an
endorsement requiring at least thirty (30) days prior written
notice of cancellation to Landlord and Landlord’s lender (if
any), before cancellation or change in coverage, scope or amount of
any policy. Tenant shall deliver certificates of such policies
together with evidence of payment of all current premiums to
Landlord within thirty (30) days of execution of this Lease;
provided, if such certificates do not on their face evidence such
terms, Tenant shall also provide full copies of such endorsements
or policies as necessary to evidence that all of the coverage
requirements of this Section 11 have been satisfied by Tenant. Any
certificate of insurance shall designate Tenant as the insured,
specify the Premises location, list Landlord (and its property
manager and lender, if any) as additional insureds (with the
additional insured endorsement attached thereto), and list Landlord
with Landlord’s current address as “Certificate
Holder.” If certificates are
supplied (rather than the policies), Tenant shall allow Landlord,
at all reasonable times, to inspect the policies of insurance
required herein. Tenant shall take all necessary steps to
renew all insurance at least thirty (30) days prior to such
insurance expiration dates and shall provide Landlord a copy of the
renewed certificate, prior to said policy’s expiration date.
If Tenant fails at any time to maintain the insurance required by
this Lease, and fails to cure such default within five (5) business
days of written notice from Landlord then, in addition to all other
remedies available under this Lease and applicable Law, Landlord
may purchase such insurance on Tenant’s behalf and the cost
of such insurance shall be Additional Rent due within ten (10) days
of written invoice from Landlord to Tenant.
(ii) It
is expressly understood and agreed that the coverages required by
this Section 11 represent Landlord’s minimum requirements and
such are not to be construed to void or limit Tenant’s
obligations contained in this Lease, including without limitation
Tenant’s indemnity obligations hereunder. Neither shall (a)
the insolvency, bankruptcy or failure of any insurance company
carrying Tenant, (b) the failure of any insurance company to pay
claims occurring nor (c) any exclusion from or insufficiency of
coverage be held to affect, negate or waive any of Tenant’s
indemnity obligations under this Lease or any other provision of
this Lease. Landlord reserves the right to require Tenant provide
evidence of any additional insurance as it reasonably deems
appropriate, as well as the right to require an increase in the
amounts of insurance or the insurance coverages as Landlord may
reasonably request from time to time, but not in excess of the
requirements of prudent landlords or lenders for similar tenants
occupying similar premises in the Puget Sound metropolitan area.
Tenant’s occupancy of the Premises without delivering the
certificates of insurance shall not constitute a waiver of
Tenant’s obligations to provide the required coverages. If
Tenant provides to Landlord a certificate that does not evidence
the coverages required herein, or that is faulty in any respect,
such shall not constitute a waiver of Tenant’s obligations to
provide the proper insurance
C. Waiver
of Subrogation. Landlord and Tenant release and relieve the
other, and waive the entire right of recovery for loss or damage to
property located within or constituting a part or all of the
Premises, the Building or the Property to the extent that the loss
or damage is actually covered (and claim amount recovered) by
commercial insurance carried by either party and in force at the
time of such loss or damage. This waiver applies whether or not the
loss is due to the negligent acts or omissions of Landlord or
Tenant, or their respective officers, directors, employees, agents,
contractors, or invitees. Each of Landlord and Tenant 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.
SECTION
12: CASUALTY DAMAGE
9
In the
event the Building or Premises shall be destroyed or rendered
untenantable, either wholly or in part, by fire or other casualty,
Landlord may, at its option, restore the Building or Premises to as
near their previous condition as is reasonably possible and in the
meantime the Rent shall be abated in the same proportion as the
untenantable portion of the Premises bears to the whole thereof,
provided, such
abatement (i) shall apply only to the extent the Premises are
untenantable for the purposes permitted under this Lease and not
used by Tenant as a result thereof, and (ii) shall not apply if
Tenant or any other occupant of the Premises or any of their
agents, employees, invitees, transferees or contractors caused the
damage. Unless Landlord, within sixty (60) days after the happening
of any such casualty, shall notify Tenant of its election to so
restore, this Lease shall thereupon terminate and end, provided, if in
Landlord’s estimation the Premises cannot be restored within
one hundred twenty (120) days following such destruction, Landlord
shall notify Tenant and Tenant may terminate this Lease (regardless
of Landlord’s intent to restore) by delivery of notice to
Landlord within thirty (30) days of Landlord’s notice. Such
restoration by Landlord shall not include replacement of furniture,
equipment or other items that do not become part of the Building or
any improvements to the Premises in excess of those provided for in
the allowance for building standard items. Tenant agrees that the
abatement of Rent as provided above shall be Tenant’s sole
and exclusive recourse in the event of such damage, and Tenant
waives any other rights Tenant may have under applicable Law to
perform repairs or terminate the Lease by reason of damage to the
Building or Premises.
SECTION
13: CONDEMNATION
If at
least fifty percent (50%) of the rentable area of the Premises
shall be taken by power of eminent domain or condemned by a
competent authority or by conveyance in lieu thereof for public or
quasi-public use (“Condemnation”), including any
temporary taking for a period of one year or longer, this Lease
shall terminate on the date possession for such use is so taken.
If: (i) less than fifty percent (50%) of the Premises is taken, but
the taking includes or affects a material portion of the Building
or Property, or the economical operation thereof, (ii) less than
fifty percent (50%) of the Premises are taken and in the reasonable
judgment of Landlord the remaining Premises are not usable for the
business of Tenant, or (iii) the taking is temporary but will be in
effect for more than thirty (30) days, then in either such event,
Landlord may elect to terminate this Lease upon at least thirty
(30) days’ prior notice to Tenant. The parties further agree
that: (a) if this Lease is terminated, all Rent shall be
apportioned as of the date of such termination or the date of such
taking, whichever shall first occur, (b) if the taking is
temporary, Rent shall not be abated for the period of the taking,
but Tenant may seek a condemnation award therefor (and the Term
shall not be extended thereby), and (c) if this Lease is not
terminated but any part of the Premises is permanently taken, the
Rent shall be proportionately abated based on the square footage of
the Premises so taken. Landlord shall be entitled to receive the
entire award or payment in connection with such Condemnation and
Tenant hereby assigns to Landlord any interest therein for the
value of Tenant’s unexpired leasehold estate or any other
claim and waives any right to participate therein, and Tenant shall
make no claim against Landlord for termination of the leasehold
interest or interference with Tenant’s business. Tenant,
however, shall have the right to claim damages from the condemning
authority for a temporary taking of the leasehold as described
above, for moving expenses and any taking of Tenant’s
personal property and for the interruption to Tenant’s
business, but only if such damages are awarded separately in the
eminent domain proceeding and not as part or in diminution of the
damages recovered by Landlord.
SECTION
14: ASSIGNMENT AND SUBLETTING
A. Consent
Required. Tenant shall not, without the prior written
consent of Landlord, assign this Lease or any interest therein, or
sublet the Premises or any part thereof, or permit the use of the
Premises by any party other than Tenant or otherwise transfer this
Lease (collectively “Transfer”). Such consent shall be
entirely discretionary with Landlord, except as otherwise provided
in this Section 14. Consent to one such Transfer shall not destroy
or waive this provision, and all subsequent Transfers shall
likewise be made only upon obtaining prior written consent of
Landlord. Subtenants or assignees shall become directly liable to
Landlord for all obligations of Tenant hereunder, without relieving
Tenant of any liability.
B. Transfers.
If Tenant is a corporation, then any Transfer of this Lease by
merger, consolidation or liquidation, or any change in the
ownership of, or power to vote, the majority of its outstanding
voting stock, shall constitute an assignment for the purpose of
this Section 14. If Tenant is a partnership or limited liability
company, any Transfer of this Lease by merger, consolidation,
liquidation or dissolution, or any change in the ownership of a
majority of the partnership or membership interests, shall
constitute an assignment for the purposes of this Section 14. An
assignment forbidden within the meaning of this Section includes
without limitation one or more sales or Transfers, by operation of
law or otherwise, or creation of new stock, by which an aggregate
of more than fifty percent (50%) of Tenant’s stock shall be
vested in a party or parties who are nonstockholders as of the date
hereof. This Section 14(B) 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.
10
C. Recapture.
If Tenant at any time desires to Transfer this Lease or any part
thereof, it shall first notify Landlord in writing of its desire to
do so, and offer Landlord the right to recapture, at the per square
foot rental for the space then applicable pursuant to this Lease or
the rental which Tenant proposed to obtain whichever is lower, for
all or any part of the Premises which Tenant desires to assign or
sublet. Tenant’s notice to Landlord shall specify (i) the
name and business of the proposed assignee or sublessee, (ii) the
amount and location of this space affected, (iii) the proposed
effective date and duration of the subletting or assignment, and
(iv) the proposed rental to be paid to Tenant by such sublessee or
assignee. Landlord, upon receipt of such notice, shall have the
option, to be exercised within sixty (60) days from the date of the
receipt of such notice, to require Tenant to execute an assignment
to Landlord of this Lease (if Tenant desires to assign this Lease)
or a sublease to Landlord of the Premises or such portion thereof
as Tenant desires to sublet with the right of Landlord to sublease
to others, or anyone designated by Landlord. If Landlord exercises
such option and such assignment or sublease is at the rental
specified in this Lease, Tenant shall be released of all further
liability hereunder, from and after the effective date of such
assignment or sublease, with respect to that portion of the
Premises included therein. If Landlord does not exercise such
option within such time, Tenant may thereafter assign this Lease or
sublet the premises involved, provided Landlord consents thereto,
but at a rental not less than offered to Landlord in the notice and
not later than ninety (90) days after delivery of the aforesaid
notice unless a further notice is given. In the event Landlord does
not exercise its right to terminate this Lease or to sublet a
portion of the Premises from Tenant and Landlord has granted its
written consent, Tenant may assign this Lease or sublet all or a
portion of the Premises in accordance with Landlord’s
consent. Any Rent accruing to Tenant as a result of such assignment
or sublease which is in excess or the Rent then being paid by
Tenant, or in excess of the pro rata share of Rent then being paid
by Tenant for the portion of the Premises being sublet, shall be
paid by Tenant to Landlord monthly as additional rent.
D. Costs.
Whether or not Landlord consents to a proposed Transfer (or
exercises its right to recapture), Tenant shall reimburse Landlord
on demand for any and all costs that may be incurred by Landlord in
connection with any proposed Transfer including, without
limitation, the cost of investigating the acceptability of the
proposed transferee and Landlord’s reasonable
attorneys’ fees incurred in connection with each proposed
Transfer.
E. Notice.
Any notice or request to Landlord with respect to a proposed
assignment or sublease shall contain the name of the proposed
assignee or subtenant (collectively “Transferee”), the
nature of the proposed Transferee’s business to be conducted
at the Premises, and the terms and provisions of the proposed
Transfer. Tenant shall also provide Landlord with a copy of the
proposed Transfer documents when available, and such financial and
other information with respect to the proposed Transferee and
Transfer that Landlord may reasonably require.
F. Consent.
Notwithstanding the foregoing, in the event of a proposed Transfer,
if Landlord does not exercise its option under Section 14(C), then
Landlord will not unreasonably withhold its consent thereto if (a)
Tenant is not then, nor has been, in default of this Lease (beyond
any applicable cure period), (b) the proposed Transferee will
continuously occupy and use the Premises for the term of the
Transfer, (c) the use by the proposed Transferee will be the same
as Tenant’s use of the Premises, (d) the proposed Transferee
is reputable and of sound financial condition, (e) the Transfer
will not directly or indirectly cause Landlord to be in breach of
any contractual obligation, and (f) the proposed Transferee is not
an existing tenant or subtenant of any other premises located on
the Property. In all other cases, Landlord may withhold consent in
its sole discretion.
G. Terms;
Transfer Premium. Any option(s) granted to Tenant in this
Lease or any option(s) granted to Tenant in any amendments to this
Lease, to the extent that said option(s) have not been exercised,
shall terminate and be voided in the event this Lease is assigned,
or any part of the Premises are sublet, or Tenant’s interest
in the Premises are otherwise Transferred, unless otherwise agreed
to by Lanadlord. If Landlord consents to a Transfer, as a condition
thereto which the parties hereby agree is reasonable, Tenant shall
pay to Landlord fifty percent (50%) of any “Transfer
Premium,” as that term is defined in this Section 14(G),
received by Tenant from such Transferee. “Transfer
Premium” shall
mean all rent, additional rent or other consideration payable by
such Transferee in connection with the Transfer in excess of the
Rent and Additional Rent payable by Tenant under this Lease during
the term of the Transfer on a per rentable square foot basis if
less than all of the Premises is transferred, after deducting the
reasonable expenses incurred by Tenant for (i) any changes,
alterations and improvements to the Premises in connection with the
Transfer, (ii) any free base rent or other economic concessions
reasonably provided to the Transferee, (iii) any brokerage
commissions in connection with the Transfer, and (iv) actual,
reasonable attorneys’ fees incurred by Tenant in connection
with the Transfer. “Transfer Premium” shall also include, but
not be limited to, key
money, bonus money or other cash consideration paid by Transferee
to Tenant in connection with such Transfer, and any payment in
excess of fair market value for services rendered by Tenant to
Transferee or for assets, fixtures, inventory, equipment, or
furniture transferred by Tenant to Transferee in connection with
such Transfer. The determination of the amount of Landlord’s
applicable share of the Transfer Premium shall be made on a monthly
basis as rent or other consideration is received by Tenant under
the Transfer.
SECTION
15: PERSONAL PROPERTY, RENT AND OTHER TAXES
Tenant
shall pay prior to delinquency all taxes, charges or other
governmental impositions assessed against, levied upon or otherwise
imposed upon or with respect to all fixtures, furnishings, personal
property, systems and equipment located in or exclusively serving
the Premises, and any improvements made to the Premises under or
pursuant to the provisions of this Lease. Whenever possible, Tenant
shall cause all such items to be assessed and billed separately
from the other property of Landlord. In the event any such items
shall be assessed and billed with the other property of Landlord,
Tenant shall pay Landlord its share of such taxes, charges or other
governmental impositions within ten (10) days after Landlord
delivers a statement and a copy of the assessment or other
documentation showing the amount of impositions applicable to
Tenant’s property. Tenant shall pay any rent tax, sales tax,
service tax, transfer tax, value added tax, or any other applicable
tax on the Rent, utilities or services herein, the privilege of
renting, using or occupying the Premises, or collecting Rent
therefrom, or otherwise respecting this Lease or any other document
entered in connection herewith.
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SECTION
16: TENANT’S DEFAULT; LANDLORD’S
REMEDIES
A. Default.
The occurrence of any one or more of the following events shall
constitute a “Default” by Tenant and shall give rise to
Landlord’s remedies set forth in Section 16(B) below: (i)
failure to make when due any payment of Rent, provided, however, that Tenant shall
not be in default solely due to such failure so long as (a) no more
than one (1) such failure occurs during any calendar year, and (b)
any such failure is cured within three (3) business days after
notice from Landlord; (ii) failure to observe or perform any term
or condition of this Lease other than the payment of Rent (or the
other matters expressly described herein), unless such failure is
cured within any period of time following notice expressly provided
with respect thereto in other Sections hereof, or otherwise within
a reasonable time, but in no event more than thirty (30) days
following notice from Landlord (provided, if the nature of
Tenant’s failure is such that more time is reasonably
required in order to cure, Tenant shall not be in Default if Tenant
commences to cure promptly within such period and thereafter
diligently pursues its completion); (iii) failure to cure
immediately upon notice thereof any condition which is hazardous,
interferes with another tenant or the operation or leasing of the
Property, or may cause the imposition of a fine, penalty or other
remedy on Landlord or its agents or affiliates; (iv) abandonment
and vacation of the Premises (failure to occupy and operate the
Premises for ten (10) consecutive days while in monetary default
under this Lease shall conclusively be deemed an abandonment and
vacation); or (v) Tenant, or any guarantor of this Lease
(“Guarantor”), filing by or for reorganization or
arrangement under any Law relating to bankruptcy or insolvency
(unless, in the case of a petition filed against Tenant or such
Guarantor, the same is dismissed within thirty (30) days); (b)
Tenant’s or any Guarantor’s insolvency or failure, or
admission of an inability, to pay debts as they mature, or (c) a
violation by Tenant or any affiliate of Tenant under any other
lease or agreement with Landlord or any affiliate thereof which is
not cured within the time permitted for cure thereunder.
Additionally, if Tenant violates the same term or condition of this
Lease on two (2) occasions during any twelve (12) month period,
Landlord shall have the right to exercise all remedies for any
violations of the same term or condition during the next twelve
(12) months without providing further notice or an opportunity to
cure. The notice and cure periods provided herein are intended to
satisfy any and all notice requirements imposed by Law on Landlord
and are in lieu of, and not in addition to, any notice and cure
periods provided by Law; provided, Landlord may elect to
comply with such notice and cure periods provided by Law. In the
event of Tenant’s default, and in addition to any other
amounts or remedies that Landlord may be entitled to, Landlord
shall be entitled to recover from Tenant, Landlord’s costs
and reasonable attorneys’ fees incurred in enforcing this
Lease or otherwise arising from Tenant’s
default.
B. Remedies.
If a Default occurs, Landlord shall have the rights and remedies
hereinafter set forth to the extent permitted by Law, which shall
be distinct, separate and cumulative with and in addition to any
other right or remedy allowed under any Law or other provision of
this Lease:
1. Landlord may
terminate Tenant’s right to possession without termination of
this Lease, or Landlord may terminate this Lease and Tenant’s
right to possession, at any time following a Default; provided, no act of Landlord
other than giving notice to Tenant with express statement of
termination shall terminate this Lease or Tenant’s right to
possession. Acts of maintenance, efforts to relet the premises or
the appointment of a receiver on Landlord’s initiative to
protect Landlord’s interest under this Lease shall not
constitute a termination of tenant’s right to possession.
Upon termination of Tenant’s right to possession, Landlord
shall have the right to reenter the Premises and recover from
Tenant in addition to any other monies provided herein or at Law:
(a) the Worth of the unpaid Rent that had been earned by Landlord
at the time of termination of Tenant’s right to possession;
(b) the Worth of the amount of the unpaid Rent that would have been
earned after the date of termination of Tenant’s right to
possession through the expiration of the Lease Term; and (c) all
other expenses incurred by Landlord on account of Tenant’s
Default, including without limitation any Costs of Reletting
(defined below) and Landlord’s attorneys’ fees and
collection costs. The “Worth” as used for item (a)
above is to be computed by allowing interest at the rate of
eighteen percent (18%) to accrue on all such unpaid Rent (or such
lesser rate required by Law, if any). The Worth as used for item
(b) above is to be computed by discounting the amount of Rent at
the discount rate of the Federal Reserve Bank of San Francisco at
the time of termination of Tenant’s right of
possession.
2. In the event
Landlord has made improvements to the Premises for the use and
occupancy of Tenant, in addition to all other damages and rents to
which Landlord shall be entitled on account of Tenant’s
Default, Landlord shall also be entitled to recover from Tenant a
sum equal to: (a) the unamortized cost to Landlord of the basic
building standard Tenant improvement costs, said sum being computed
by applying the percentage which the unexpired portion of the Lease
Term bears to the total scheduled Lease Term with interest at ten
percent (10%) per annum, plus (b) all costs to Landlord of
non-building standard, custom or special Tenant improvements (above
basic building standard improvements) with no adjustment for the
unexpired portion of the scheduled Lease Term.
3. In the event of any
such reentry by Landlord, Landlord may, at Landlord’s option,
require Tenant to remove from the Premises any of Tenant’s
property located thereon. If Tenant fails to do so, Landlord shall
not be responsible for the care or safekeeping thereof and may
remove any of the same from the Premises and place the same
elsewhere in the Building or in storage in a public warehouse at
the cost, expense and risk of Tenant with authority to the
warehouseman to sell the same in the event that Tenant shall fail
to pay the cost of transportation and storage, all in accordance
with the rules and regulations applicable to the operation of a
public warehouseman’s business. In any and all such cases of
reentry Landlord may make any repairs in, to or upon the Premises
which may be necessary, desirable or convenient, and Tenant hereby
waives any and all claims for damages which may be caused or
occasioned by such reentry or to any property in or about the
Premises or any part thereof.
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4. Landlord may bring
suits for amounts owed by Tenant hereunder or any portions thereof,
as the same accrue or after the same have accrued, and no suit or
recovery of any portion due hereunder shall be deemed a waiver of
Landlord’s right to collect all amounts to which Landlord is
entitled hereunder, nor shall the same serve as any defense to any
subsequent suit brought for any amount not therefor reduced to
judgment. Landlord may pursue one or more remedies against Tenant
and need not make an election of remedies. All rent and other
consideration paid by any replacement tenants shall be applied at
Landlord’s option: (i) first, to the Costs of Reletting
(defined below), (ii) second, to the payment of all costs and
attorneys’ fees of enforcing this Lease against Tenant or any
Guarantor, (iii) third, to the payment of all interest and service
charges accruing hereunder, (iv) fourth, to the payment of Rent
theretofore accrued, and (v) with the residue, if any, to be held
by Landlord and applied to the payment of Rent and other
obligations of Tenant as the same become due (and with any
remaining residue to be retained by Landlord). “Costs of
Reletting” shall include without limitation, all costs and
expenses incurred by Landlord for any repairs, improvements or
other matters necessary to prepare the Premises for another tenant,
brokerage commissions, advertising costs, attorneys’ fees,
any economic incentives given to enter leases with replacement
tenants. With respect to reletting the Premises, Landlord shall
only be required to use reasonable efforts that do not exceed such
efforts Landlord generally uses to lease other space in the
Building, Landlord may continue to lease other portions of the
Building or other projects owned or managed by Landlord in the same
vicinity before reletting all or a portion of the Premises, and
Landlord shall not be required to relet at rental rates less than
Landlord’s then-existing rates for new leases or terms less
favorable to Landlord than those contained herein. The times set
forth herein for the curing of Defaults by Tenant are of the
essence in this Lease.
5. All covenants and
agreements to be kept or performed by Tenant under this Lease shall
be performed by Tenant at Tenant’s sole cost and expense and
without any reduction of Rent, except to the extent, if any,
otherwise expressly provided herein. If Tenant shall fail to
perform any obligation under this Lease, and such failure shall
continue in excess of the time allowed under Section 16(A) above,
unless a specific time period is otherwise stated in this Lease,
Landlord may, but shall not be obligated to, make any such payment
or perform any such act on Tenant’s part without waiving its
rights based upon any default of Tenant and without releasing
Tenant from any obligations hereunder. Except as may be
specifically provided to the contrary in this Lease, and in
addition to any other damages recoverable by Landlord hereunder,
Tenant shall pay to Landlord, upon delivery by Landlord to Tenant
of statements therefor, all sums necessary to reimburse Landlord or
pay to Landlord its expenditures actually made and obligations
actually incurred in connection with remedying Tenant defaults
pursuant to this Section 16(B)(5).
SECTION
17: SUBORDINATION, ATTORNMENT AND LENDER
PROTECTION
This
Lease is subject and subordinate to all Mortgages now or hereafter
placed upon the Property, Building, Premises or any interest of
Landlord therein, and all other encumbrances, and matters of public
record applicable to the Property, Building or Premises. Whether
before or after any foreclosure or power of sale proceedings are
initiated or completed by any Lender or a deed in lieu is granted
(or any ground lease is terminated), Tenant agrees upon written
request of any such Lender or any purchaser at such sale, to attorn
and pay Rent to such party, and recognize such party as Landlord
(provided such Lender or purchaser shall agree not to disturb
Tenant’s occupancy so long as Tenant does not Default
hereunder, on a form customarily used by, or otherwise reasonably
acceptable to, such party). However, in the event of attornment, no
Lender shall be: (i) liable for any act or omission of Landlord, or
subject to any offsets or defenses which Tenant might have against
Landlord (arising prior to such Lender becoming Landlord under such
attornment), (ii) liable for any security deposit or bound by any
prepaid Rent not actually received by such Lender, or (iii) bound
by any modification of this Lease not consented to by such Lender.
Any Lender may elect to make this Lease prior to the lien of its
Mortgage by written notice to Tenant, and if the Lender of any
prior Mortgage shall require, this Lease shall be prior to any
subordinate Mortgage; such elections shall be effective upon
written notice to Tenant, or shall be effective as of such earlier
or later date set forth in such notice. Tenant agrees to give any
Lender by certified mail, return receipt requested, a copy of any
notice of default served by Tenant upon Landlord, provided that
prior to such notice Tenant has been notified in writing (by way of
service on Tenant of a copy of an assignment of leases, or
otherwise) of the address of such Lender. Tenant further agrees
that if Landlord shall have failed to cure such default within the
time permitted Landlord for cure under this Lease, any such Lender
whose address has been provided to Tenant shall have an additional
period of thirty (30) days in which to cure (or such additional
time as may be required due to causes beyond such Lender’s
control, including time to obtain possession of the Property by
appointment of receiver, power of sale or judicial action). Should
any current or prospective Lender require a modification or
modifications to this Lease which will not cause an increased cost
or otherwise materially and adversely change the rights and
obligations of Tenant hereunder, Tenant agrees that this Lease
shall be so modified. Except as expressly provided to the contrary
herein, the provisions of this Section shall be self-operative;
however Tenant shall execute and deliver, within ten (10) days
after requested, such documentation as Landlord or any Lender may
request from time to time, whether prior to or after a foreclosure
or power of sale proceeding is initiated or completed, a deed in
lieu is delivered, or a ground lease is terminated, in order to
further confirm or effectuate the matters set forth in this Section
in recordable form (and Tenant hereby authorizes Landlord acting in
good faith to execute any such documentation as Tenant’s
agent and attorney-in-fact). Tenant hereby waives the provisions of
any Law (now or hereafter adopted) which may give or purport to
give Tenant any right or election to terminate or otherwise
adversely affect this Lease or Tenant’s obligations hereunder
if foreclosure or power of sale proceedings are initiated,
prosecuted or completed.
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SECTION
18: ESTOPPEL CERTIFICATES
Tenant
shall from time to time, within five (5) days after written request
from Landlord, execute, acknowledge and deliver a statement
certifying: (i) that this Lease is unmodified and in full force and
effect or, if modified, stating the nature of such modification and
certifying that this Lease as so modified, is in full force and
effect (or specifying the ground for claiming that this Lease is
not in force and effect), (ii) the dates to which the Rent has been
paid, and the amount of any Security Deposit, (iii) that Tenant is
in possession of the Premises, and paying Rent on a current basis
with no offsets, defenses or claims, or specifying the same if any
are claimed, (iv) that there are not, to Tenant’s knowledge,
any uncured defaults on the part of Landlord or Tenant which are
pertinent to the request, or specifying the same if any are
claimed, and (v) certifying such other matters, and including such
current financial statements, as Landlord may reasonably request,
or as may be requested by Landlord’s current or prospective
Lenders, insurance carriers, auditors, and prospective purchasers
(and including a comparable certification statement from any
subtenant respecting its sublease). Any such statement may be
relied upon by any such parties. If Tenant shall fail to execute
and return such statement within the time required herein, Tenant
shall be deemed to have agreed with the matters set forth therein,
and Landlord acting in good faith shall be authorized as
Tenant’s agent and attorney-in-fact to execute such statement
on behalf of Tenant (which shall not be in limitation of
Landlord’s other remedies).
SECTION
19: RIGHTS RESERVED BY LANDLORD
Except
to the extent expressly limited herein, Landlord reserves full
rights to control the Property (which rights may be exercised
without subjecting Landlord to claims for constructive eviction,
abatement of Rent, damages or other claims of any kind), including
more particularly, but without limitation, the following
rights:
A. General
Matters. To: (i) change the name or street address of the
Building or Property or designation of the Premises, (ii) install
and maintain signs on the exterior and interior of the Building or
Property, and grant any other person the right to do so, (iii)
retain at all times, and use in appropriate instances, keys to all
doors within and into the Premises, (iv) grant to any person the
right to conduct any business or render any service at the
Property, whether or not the same are similar to the use permitted
Tenant by this Lease, (v) grant any person the right to use
separate security personnel and systems respecting access to their
premises, (vi) have access for Landlord and other tenants of the
Building to any mail chutes located on the Premises according to
the rules of the United States Postal Service (and to install or
remove such chutes), and (vii) in case of fire, invasion,
insurrection, riot, civil disorder, emergency or other dangerous
condition, or threat thereof: (a) limit or prevent access to the
Building or Property or Premises, (b) shut down elevator service,
(c) activate elevator emergency controls, and (d) otherwise
take such action or preventative measures deemed necessary by
Landlord for the safety of tenants of the Building or Property or
the protection of the Building or Property and other property
located thereon or therein (but this provision shall impose no duty
on Landlord to take such actions, and no liability for actions
taken in good faith).
B. Access
to Premises. To enter the Premises in order to: (i) inspect,
(ii) supply cleaning service or other services to be provided
Tenant hereunder, (iii) show the Premises to current and
prospective Lenders, insurers, purchasers, tenants, brokers and
governmental authorities, (iv) decorate, remodel or alter the
Premises if Tenant shall abandon the Premises at any time, or shall
vacate the same during the last one hundred twenty (120) days of
the Term (without thereby terminating this Lease), and (v) perform
any work or take any other actions under Section 19(C) below, or
exercise other rights of Landlord under this Lease or applicable
Laws. However, Landlord shall: (a) provide reasonable advance
written or oral notice to Tenant’s on site manager or other
appropriate person for matters which will involve a significant
disruption to Tenant’s business (except in emergencies), (b)
take reasonable steps to minimize any significant disruption to
Tenant’s business, and following completion of any work,
return Tenant’s leasehold improvements, fixtures, property
and equipment to the original locations and condition to the
fullest extent reasonably possible, and (c) take reasonable steps
to avoid materially changing the configuration or reducing the
square footage of the Premises, unless required by Laws or other
causes beyond Landlord’s reasonable control (and in the event
of any permanent material reduction, the Rent and other rights and
obligations of the parties based on the square footage of the
Premises shall be proportionately reduced). Tenant shall not place
partitions, furniture or other obstructions in the Premises which
may prevent or impair Landlord’s access to the Systems and
Equipment for the Property or the systems and equipment for the
Premises. If Tenant requests that any such access occur before or
after Landlord’s regular business hours and Landlord
approves, Tenant shall pay all overtime and other additional costs
in connection therewith.
C. Changes
To The Property. To: (i) paint and decorate, (ii) perform
repairs or maintenance, and (iii) make replacements, restorations,
renovations, alterations, additions and improvements, structural or
otherwise (including freon retrofit work), in and to the Building
or Property or any part thereof, including any adjacent building,
structure, facility, land, street or alley, or change the uses
thereof (including changes, reductions or additions of corridors,
entrances, doors, lobbies, parking facilities and other areas,
structural support columns and shear walls, elevators, stairs,
escalators, mezzanines, solar tint windows or film, kiosks,
planters, sculptures, displays, and other amenities and features
therein, and changes relating to the connection with or entrance
into or use of the Building or Property or any other adjoining or
adjacent building or buildings, now existing or hereafter
constructed). In connection with such matters, Landlord may among
other things erect scaffolding, barricades and other structures,
open ceilings, close entry ways, restrooms, elevators, stairways,
corridors, parking and other areas and facilities, and take such
other actions as Landlord deems appropriate. However, Landlord
shall: (a) take reasonable steps to minimize or avoid any denial of
access to the Premises except when necessary on a temporary basis,
and (b) in connection with entering the Premises shall comply with
Section 19(B) above.
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D. New
Premises. To substitute for the Premises other premises
(herein referred to as the “new premises”) in the
Building, provided: (i) the new premises shall be similar to the
Premises in size (up to 10% larger or smaller with the Rent and any
other rights and obligations of the parties based on the square
footage of the Premises adjusted proportionately to reflect any
decrease), (ii) Landlord shall provide the new premises in a
condition substantially comparable to the Premises at the time of
the substitution (and Tenant shall diligently cooperate in the
preparation or approval of any plans or specifications for the new
premises as requested by Landlord or Landlord’s
representatives), (iii) the parties shall execute an appropriate
amendment to the Lease confirming the change within thirty (30)
days after Landlord requests, and (iv) if Tenant shall already have
taken possession of the Premises: (a) Landlord shall pay the
direct, out of pocket, reasonable expenses of Tenant in moving from
the Premises to the new premises, and (b) Landlord shall give
Tenant at least thirty (30) days’ notice before making such
change, and such move shall be made during evenings, weekends, or
otherwise so as to incur the least inconvenience to Tenant. Tenant
shall surrender and vacate the Premises on the date required in
Landlord’s notice of substitution, in the condition and as
required under Section 22, and any failure to do so shall be
subject to Section 23.
E. Redevelopment
Rights and Construction Activities; Landlord Termination
Right. Landlord reserves all rights to alter and/or
redevelop the Building and the Property, including the Premises,
and to perform construction activities in connection therewith
(collectively, “Construction Activities”). Construction
Activities may include (i) painting and decoration, (ii) repairs
and maintenance, (iii) replacements, restorations, renovations,
alterations, additions (including adding additional floors to the
Building) and improvements, structural and otherwise, in and to the
Building or Property or any part thereof, including any adjacent
building, structure, facility, land, street or alley, and (iv) any
changes in the uses thereof (including changes, reductions or
additions of corridors, entrances, doors, lobbies, parking
facilities and other areas, structural support columns and shear
walls, elevators, stairs, escalators, mezzanines, solar tint
windows or film, kiosks, planters, sculptures, displays, and other
amenities and features therein, and changes relating to the
connection with or entrance into or use of the Building or Property
or any other adjoining or adjacent building or buildings, now
existing or hereafter constructed). In connection with any such
Construction Activities, Landlord may among other things erect
scaffolding, barricades and other structures, open ceilings, close
entry ways, restrooms, elevators, stairways, corridors, parking and
other areas and facilities, and take such other actions as Landlord
deems appropriate. Landlord shall take reasonable steps to minimize
or avoid any denial of access to the Premises or interference with
Tenant’s use of the Premises except when necessary on a
temporary basis; provided, however, that if Landlord determines in
its reasonable judgment that it is necessary or expedient to do so,
Landlord shall have the right, at its option, to terminate this
Lease in connection with any Construction Activities, by giving
Tenant written notice to such effect (the "Termination Notice") not
less than twelve (12) months prior to the termination date set
forth in the Termination Notice (the “Termination
Date”). On the Termination Date (i) this Lease shall be fully
and finally terminated; (ii) Tenant shall vacate the Premises and
surrender possession of the Premises to Landlord in accordance with
the provisions of the Lease, and (iii) Landlord and Tenant shall be
fully and unconditionally relieved and released of and from their
respective obligations and liabilities under or connected with the
provisions of this Lease accruing or arising after the Termination
Date; provided, however, that any indemnity or similar provisions
of this Lease and any obligations on the part of Landlord or Tenant
to reimburse the other party for overpayments or underpayments
shall survive the termination of the Lease and remain fully
effective as to any and all demands, claims, causes of action, or
reimbursement obligations that accrued or arose on or before the
Termination Date. If Landlord elects to terminate this Lease in
accordance with this Section, Landlord shall work in good faith
with Tenant to identify potential alternative spaces for Tenant to
lease within the portfolio of Seattle office buildings owned by
Landlord or its affiliates.
SECTION
20: LANDLORD’S DEFAULT; REMEDIES
If
Landlord shall fail to perform any obligation under this Lease
required to be performed by Landlord, Landlord shall not be deemed
to be in default hereunder nor subject to any claims for damages of
any kind, unless such failure shall have continued for a period of
thirty (30) days after notice thereof by Tenant (provided, if the
nature of Landlord’s failure is such that more time is
reasonably required in order to cure, Landlord shall not be in
default if Landlord commences to cure within such period and
thereafter diligently seeks to cure such failure to completion). If
Landlord shall default and failure to cure as provided herein,
Tenant shall have such rights and remedies as may be available to
Tenant under applicable Laws, subject to the other provisions of
this Lease; provided, Tenant shall have no right of self-help to
perform repairs or any other obligation of Landlord, and shall have
no right to withhold, set-off, or xxxxx Rent, or terminate this
Lease, and Tenant hereby expressly waives the benefit of any Law to
the contrary.
15
SECTION
21: RELEASE AND INDEMNITY
A. Tenant’s
Indemnification of Landlord. Tenant shall indemnify, defend
(using legal counsel reasonably acceptable to Landlord) and save
Landlord harmless from all claims, suits, losses, damages, fines,
penalties, liabilities and expenses (including Landlord’s
personnel and overhead costs and reasonable attorneys’ fees
and other costs incurred in connection with claims (collectively,
“Claims”), regardless of whether such Claims involve
litigation) resulting from any actual or alleged injury (including
death) of any person or from any actual or alleged loss of or
damage to any property arising out of or in connection with (i)
Tenant’s occupation, use or improvement of the Premises, or
that of its employees, agents or contractors, (ii) Tenant’s
breach of its obligations hereunder or (iii) any act or omission of
Tenant or any subtenant, licensee, assignee or concessionaire of
Tenant, or of any officer, agent, employee, guest or invitee of
Tenant, or of any such entity in or about the Premises.
Notwithstanding the foregoing, in the event any Claims are caused
by the joint or concurrent negligence of Landlord or Tenant,
Tenant's indemnification obligation with respect to Landlord shall
be limited to the extent of the negligence of Tenant, and in no
event shall Tenant have any obligation to indemnify Landlord
against Claims arising out of the sole negligence of Landlord.
FOR THE SOLE PURPOSE OF GIVING FULL
FORCE AND EFFECT TO THE INDEMNIFICATION OBLIGATIONS UNDER THIS
LEASE AND NOT FOR THE BENEFIT OF ANY EMPLOYEES OF TENANT OR ANY
THIRD PARTIES UNRELATED TO THE PARTIES INDEMNIFIED UNDER THIS
LEASE, TENANT SPECIFICALLY AND EXPRESSLY WAIVES ANY IMMUNITY THAT
MAY BE GRANTED IT UNDER THE WASHINGTON STATE INDUSTRIAL INSURANCE
ACT, TITLE 51 RCW. This indemnity with respect to acts or
omissions during the term of this Lease shall survive termination
or expiration of this Lease. Tenant shall promptly notify Landlord
of casualties or accidents occurring in or about the Premises.
LANDLORD AND TENANT ACKNOWLEDGE
THAT THE INDEMNIFICATION PROVISIONS OF SECTION 29 AND THIS SECTION
21 WERE SPECIFICALLY NEGOTIATED AND AGREED UPON BY
THEM.
B. Release.
Tenant hereby fully and completely waives and releases all claims
against Landlord for any losses or other damages sustained by
Tenant or any person claiming through Tenant resulting from any
accident or occurrence in or upon the Premises, including but not
limited to: any defect in or failure of Building equipment; any
failure to make repairs; any defect, failure, surge in, or
interruption of project facilities or services; any defect in or
failure of Common Areas; broken glass; water leakage; the collapse
of any Building component; any claim or damage resulting from
Landlord’s repair, maintenance or improvements to any portion
of the Building or Property; or any act, omission or negligence of
co-tenants, licensees or any other persons or occupants of the
Building; provided
only, that the release contained in this Section 21(B) shall
not apply to claims for actual damage to persons or property
(excluding consequential damages such as lost profits) resulting
directly and solely from Landlord’s gross negligence or
willful misconduct or from Landlord’s breach of its express
obligations under this Lease which Landlord has not cured within a
reasonable time after receipt of written notice of such breach from
Tenant.
C. Definitions.
As used in any Section of this Lease establishing indemnity or
release of Landlord, “Landlord” shall include Landlord,
its property manager if any, and their respective managers,
members, partners, officers, agents, employees and contractors, and
“Tenant” shall include Tenant and any person or entity
claiming through Tenant.
SECTION
22: RETURN OF POSSESSION
At the
expiration or earlier termination of this Lease or Tenant’s
right of possession, Tenant shall vacate and surrender possession
of the entire Premises in good, neat and clean order and
well-maintained condition, ordinary wear and tear excepted, shall
surrender all keys and key cards, and any parking transmitters,
stickers or cards, to Landlord, and shall remove all personal
property and office trade fixtures that may be readily removed
without damage to the Premises or Property. All improvements,
fixtures and other items installed by Tenant or Landlord under or
with respect to this Lease, shall be the property of Tenant during
the Term of this Lease, but at the expiration or earlier
termination of this Lease all such improvements, fixtures and other
items shall become Landlord’s property, and shall remain upon
the Premises (unless Landlord elects otherwise), all without
compensation, allowance or credit to Tenant. If prior to such
termination or within three (3) months thereafter Landlord so
directs by notice, and subject to the terms of Section 10(A) of
this Lease, Tenant shall promptly remove such of the foregoing
items as are designated in such notice and restore the Premises to
the condition prior to the installation of such items in a good and
workmanlike manner. If Tenant shall fail to perform any repairs or
restoration, or fail to remove any items from the Premises required
hereunder, Landlord may do so and Tenant shall pay Landlord’s
charges therefor upon demand. All property removed from the
Premises by Landlord pursuant to any provisions of this Lease or
any Law may be handled or stored by Landlord at Tenant’s
expense, and Landlord shall in no event be responsible for the
value, preservation or safekeeping thereof. All property not
removed from the Premises or retaken from storage by Tenant within
thirty (30) days after expiration or earlier termination of this
Lease or Tenant’s right to possession, shall at
Landlord’s option be conclusively deemed to have been
conveyed by Tenant to Landlord as if by xxxx of sale without
payment by Landlord. Unless prohibited by applicable Law, Landlord
shall have a lien against such property for the costs incurred in
removing and storing the same. Tenant hereby waives any statutory
notices to vacate or quit the Premises upon expiration of this
Lease.
16
SECTION
23: HOLDING OVER
Unless
Landlord expressly agrees otherwise in writing, Tenant shall pay
Landlord two hundred percent (200%) of the amount of Rent then
applicable prorated on a per diem basis for each day Tenant shall
fail to vacate or surrender possession of the Premises or any part
thereof after expiration or earlier termination of this Lease,
together with all damages sustained by Landlord on account thereof.
Tenant shall pay such amounts on demand, and, in the absence of
demand, monthly in advance. The foregoing provisions, and
Landlord’s acceptance of any such amounts, shall not serve as
permission for Tenant to hold over, nor serve to extend the Term
(although Tenant shall remain a tenant-at-sufferance bound to
comply with all provisions of this Lease). Landlord shall have the
right at any time after expiration or earlier termination of this
Lease, or Tenant’s right to possession, to reenter and
possess the Premises and remove all property and persons therefrom,
and Landlord shall have such other remedies for holdover as may be
available to Landlord under other provisions of this Lease or
applicable Laws.
SECTION
24: NOTICES
Except
as expressly provided to the contrary in this Lease, every notice
or other communication to be given by either party to the other
with respect hereto or to the Premises, Building or Property, shall
be in writing and shall not be effective for any purpose unless the
same shall be served personally, or by national air courier
service, or United States certified mail, return receipt requested,
postage prepaid, to the parties at the addresses set forth in
Section 1, or such other address or addresses as Tenant or Landlord
may from time to time designate by notice given as above provided.
Every notice or other communication hereunder shall be deemed to
have been given as of the third business day following the date of
such mailing (or as of any earlier date evidenced by a receipt from
such national air courier service or the United States Postal
Service) or immediately if personally delivered. Notices not sent
in accordance with the foregoing shall be of no force or effect
until received by the foregoing parties at such addresses required
herein.
SECTION
25: REAL ESTATE BROKERS
Tenant
represents that Tenant has dealt only with the broker, if any,
designated in Section 1 (whose commission, if any, shall be paid by
Landlord pursuant to separate agreement) as broker, agent or finder
in connection with this Lease, and agrees to indemnify and hold
Landlord harmless from all damages, judgments, liabilities and
expenses (including reasonable attorneys’ fees) arising from
any claims or demands of any other broker, agent or finder with
whom Tenant has dealt for any commission or fee alleged to be due
in connection with its participation in the procurement of Tenant
or the negotiation with Tenant of this Lease. Landlord and Tenant
recognize that it is possible that they may hereafter make
additional agreements regarding further extension or renewal of
this Lease or a new lease or leases for all or one or more parts of
the Premises or other space in the Building (or other portions of
the Property or other buildings managed by Landlord) for a term or
terms commencing after the Commencement Date of this Lease. It is
also possible that Landlord and Tenant may hereafter modify this
Lease to add additional space or to substitute other space for all
or a portion of the Premises. In the event any such additional
agreements, modifications to this Lease, or new leases are made,
Landlord shall have no obligation to pay any commission or other
compensation to any broker or other party engaged by Tenant
(including the brokers designated in Section 1) with respect to
negotiating or representing Tenant in such matters, regardless of
whether under the circumstances such person is or is not regarded
by law as an agent of Landlord, and Tenant shall indemnify and hold
Landlord harmless from any claim for such compensation. Nothing in
this Section 25 shall be construed to require or otherwise obligate
Landlord to consider or make any of the above-described additional
agreements, modifications to this Lease, or new lease.
SECTION
26: NO WAIVER
No
provision of this Lease will be deemed waived by either party
unless expressly waived in writing and signed by the waiving party.
No waiver shall be implied by delay or any other act or omission of
either party. No waiver by either party of any provision of this
Lease shall be deemed a waiver of such provision with respect to
any subsequent matter relating to such provision, and
Landlord’s consent or approval respecting any action by
Tenant shall not constitute a waiver of the requirement for
obtaining Landlord’s consent or approval respecting any
subsequent action. Acceptance of Rent by Landlord directly or
through any agent or lock-box arrangement shall not constitute a
waiver of any breach by Tenant of any term or provision of this
Lease (and Landlord reserves the right to return or refund any
untimely payments if necessary to preserve Landlord’s
remedies). No acceptance of a lesser amount of Rent shall be deemed
a waiver of Landlord’s right to receive the full amount due,
nor shall any endorsement or statement on any check or payment or
any letter accompanying such check or payment be deemed an accord
and satisfaction, and Landlord may accept such check or payment
without prejudice to Landlord’s right to recover the full
amount due. The acceptance of Rent or of the performance of any
other term or provision from, or providing directory listings or
services for, any person or entity other than Tenant shall not
constitute a waiver of Landlord’s right to approve any
Transfer. No delivery to, or acceptance by, Landlord or its agents
or employees of keys, nor any other act or omission of Tenant or
Landlord or their agents or employees, shall be deemed a surrender,
or acceptance of a surrender, of the Premises or a termination of
this Lease, unless stated expressly in writing by
Landlord.
17
SECTION
27: SAFETY AND SECURITY DEVICES, SERVICES AND
PROGRAMS
The
parties acknowledge that safety and security devices, services and
programs provided by Landlord, if any, while intended to deter
crime and ensure safety, may not in given instances prevent theft
or other criminal acts, or ensure safety of persons or property.
The risk that any safety or security device, service or program may
not be effective, or may malfunction, or be circumvented by a
criminal, is assumed by Tenant with respect to Tenant’s
property and interests, and Tenant shall obtain insurance coverage
to the extent Tenant desires protection against such criminal acts
and other losses. Tenant agrees to cooperate in any reasonable
safety or security program developed by Landlord or required by
Law.
SECTION
28: TELECOMMUNICATION LINES AND EQUIPMENT
A. Telecommunication
Lines. No telecommunication or computer lines (collectively,
“Lines”) shall be installed within or without the
Premises without Landlord’s prior consent in accordance with
Section 10. Landlord disclaims any representations, warranties or
understandings concerning Landlord’s Building computer
systems, or the capacity, design or suitability of Landlord’s
riser Lines, Landlord’s main distribution frame
(“MDF”) or related equipment. If there is, or will be,
more than one tenant on any floor, at any time, Landlord may
allocate, and periodically reallocate, connections to the terminal
block based on the proportion of square feet each tenant occupies
on such floor, or the type of business operations or requirements
of such tenants, in Landlord’s reasonable discretion.
Landlord may arrange for an independent contractor to review
Tenant’s requests for approval to install any
telecommunication or computer lines, monitor or supervise
Tenant’s installation, connection and disconnection of any
such lines, and provide other such services, or Landlord may
provide the same. In each case, all such work shall be performed in
accordance with Section 10 and the additional requirements set
forth below: (i) an acceptable number of spare Lines and space for
additional Lines shall be maintained for existing and future
occupants of the Project, as determined in Landlord’s
reasonable opinion; (ii) the Lines (including riser cables) shall
be appropriately insulated to prevent excessive electromagnetic
fields or radiation, shall be surrounded by a protective conduit
reasonably acceptable to Landlord, and shall be identified in
accordance with the “Identification Requirements,” as
that term is set forth below; (iii) any new or existing Lines
servicing the Premises shall comply with all applicable
governmental laws and regulations; (iv) as a condition to
permitting the installation of new Lines, Landlord may require that
Tenant remove existing Lines located in or serving the Premises and
repair any damage in connection with such removal; (v) Tenant shall
pay all costs in connection therewith; and (vi) all Lines shall be
clearly marked with adhesive plastic labels (or plastic tags
attached to such Lines with wire) to show Tenant’s name,
suite number, telephone number and the name of the person to
contact in the case of an emergency (A) every four feet (4’)
outside the Premises (specifically including, but not limited to,
the electrical room risers and other Common Areas), and (B) at the
Lines’ termination point(s) (collectively,
“Identification Requirements”). At the expiration or
earlier termination of this Lease, and at Landlord’s request,
Tenant at its cost shall remove all Lines or other computer or
telecommunication systems installed by or for Tenant and Tenant
shall restore the Premises and Building to the condition existing
prior to Tenant’s installation.
B. Wi-Fi
Network. In the event Tenant desires to install wireless
intranet, Internet and communications network (“Wi-Fi
Network”) in the Premises for the use by Tenant and its
employees, then the same shall be subject to the provisions of
Section 8 and Section 15. Tenant shall use the Wi-Fi Network so as
not to cause any interference to other tenants in the Building or
with any other tenant’s communication equipment, and not to
interfere with the normal operation of the Building. Should any
interference occur, Tenant shall take all necessary steps as soon
as reasonably possible and no later than three (3) calendar days
following such occurrence to correct such interference. If such
interference continues after such three (3) day period, Tenant
shall immediately cease operating such Wi-Fi Network until such
interference is corrected or remedied to Landlord’s
satisfaction. Tenant acknowledges that Landlord has granted and/or
may grant telecommunication rights to other tenants and occupants
of the Building and Property and to telecommunication service
providers and in no event shall Landlord be liable to Tenant for
any interference of the same with such Wi-Fi Network. Landlord
makes no representation that the Wi-Fi Network will be able to
receive or transmit communication signals without interference or
disturbance. Tenant shall (i) be solely responsible for any
damage caused as a result of the Wi-Fi Network, (ii) promptly
pay any tax, license or permit fees charged pursuant to any Laws in
connection with the installation, maintenance or use of the Wi-Fi
Network and comply with all precautions and safeguards recommended
by all governmental authorities, and (iii) pay for all
necessary repairs, replacements to or maintenance of the Wi-Fi
Network.
C. Limitation
of Liability. Unless due solely to Landlord’s
intentional misconduct or grossly negligent acts, Landlord shall
have no liability for damages arising, and Landlord does not
warrant that the Tenant’s use of any telecommunication or
computer lines or systems will be free, from the following
(collectively called “Line Problems”): (i) any
eavesdropping, wiretapping or theft of long distance access codes
by unauthorized parties, (ii) any failure of the Lines to satisfy
Tenant’s requirements, or (iii) any capacitance, attenuation,
cross talk or other problems with the Lines, any misdesignation of
the Lines in the MDF room or wire closets, or any shortages,
failures, variations, interruptions, disconnections, loss or damage
caused by or in connection with the installation, maintenance,
replacement, use or removal of any other Lines or equipment at the
Building or Property by or for other tenants at the Property or
Building, by any failure of the environmental conditions at or the
power supply for the Building to conform to any requirements of the
Lines or any other problems associated with any Lines or by any
other cause. Under no circumstances shall any Line Problems be
deemed an actual or constructive eviction of Tenant, render
Landlord liable to Tenant for abatement of any Rent or other
charges under the Lease, or relieve Tenant from performance of
Tenant’s obligations under the Lease as amended herein.
Landlord in no event shall be liable for any loss of profits,
business interruption or other consequential damage arising from
any Line Problems.
18
SECTION
29: HAZARDOUS SUBSTANCES; DISRUPTIVE
ACTIVITIES
A. Hazardous
Substances.
1. Tenant shall not,
without Landlord’s prior written consent, which may be given
or withheld in Landlord’s sole discretion, keep on or around
the Premises, Building or Property, for use, disposal, treatment,
generation, storage or sale, any substances designed as, or
containing components designated as, a “hazardous
substance,” “hazardous material,” hazardous
waste,” “regulated substance” or “toxic
substance” by applicable Law (collectively referred to as
“Hazardous Substances”). With respect to any such
Hazardous Substances, Tenant shall: (i) comply promptly, timely and
completely with all Laws for reporting, keeping and submitting
manifests, and obtaining and keeping current identification
numbers; (ii) submit to Landlord true and correct copies of all
reports, manifests and identification numbers at the same time as
they are required to be and/or are submitted to the appropriate
governmental authorities; (iii) within five (5) days of
Landlord’s request, submit written reports to Landlord
regarding Tenant’s use, storage, treatment, transportation,
generation, disposal or sale of Hazardous Substances and provide
evidence satisfactory to Landlord of Tenant’s compliance with
all applicable Laws; (iv) allow Landlord or Landlord’s agent
or representative to come on the Premises at all times to check
Tenant’s compliance with all applicable Laws; (v) comply with
minimum levels, standards or other performance standards or
requirements which may be set forth or established for certain
Hazardous Substances (if minimum standards or levels are applicable
to Hazardous Substances present on the Premises, such levels or
standards shall be established by an on-site inspection by the
appropriate governmental authorities and shall be set forth in an
addendum to this Lease); and (vi) comply with all applicable Laws
regarding the proper and lawful use, sale, transportation,
generation, treatment and disposal of Hazardous
Substances.
2. Any and all costs
incurred by Landlord and associated with Landlord’s
monitoring of Tenant’s compliance with this Section 29,
including Landlord’s attorneys’ fees and costs, shall
be additional Rent and shall be due and payable to Landlord
immediately upon demand by Landlord.
B. Cleanup
Costs, Default and Indemnification.
1. Tenant shall be
fully and completely liable to Landlord for any and all cleanup
costs, and any and all other charges, fees, penalties (civil and
criminal) imposed by any governmental authority with respect to
Tenant’s use, disposal, transportation, generation and/or
sale of Hazardous Substances, in or about the Premises, Building or
Property.
2. Tenant shall fully
indemnify, defend and save Landlord and Landlord’s Lender, if
any, harmless from any and all of the costs, fees, penalties and
charges assessed against or imposed upon Landlord (as well as
Landlord’s and Landlord’s Lender’s
attorneys’ fees and costs) as a result of Tenant’s use,
disposal, transportation, generation and/or sale of Hazardous
Substances.
3. Upon Tenant’s
default under this Section 29, in addition to the rights and
remedies set forth elsewhere in this Lease, Landlord shall be
entitled to the following rights and remedies: (i) at
Landlord’s option, to terminate this lease immediately;
and/or (ii) to recover any and all damages associated with the
default, including, but not limited to cleanup costs and charges,
civil and criminal penalties and fees, loss of business and sales
by Landlord and other tenants of the Building or Property, any and
all damages and claims asserted by third parties and
Landlord’s attorney’s fees and costs.
C. Disruptive
Activities. Tenant shall not: (1) produce, or permit to be
produced, any intense glare, light or heat except within an
enclosed or screened area and then only in such manner that the
glare, light or heat shall not, outside the Premises, be materially
different than the light or heat from other sources outside the
Premises; (2) create, or permit to be created, any sound pressure
level which will interfere with the quiet enjoyment of any real
property outside the Premises, or which will create a nuisance or
violate any Law; (3) create, or permit to be created, any floor or
ground vibration that is materially discernible outside the
Premises; (4) transmit, receive, or permit to be transmitted or
received, any electromagnetic, microwave or other radiation which
is harmful or hazardous to any person or property in or about the
Premises, Building or Property; or (5) create, or permit to be
created, any noxious odor that is disruptive to the business
operations of any other tenant in the Building or
Property.
SECTION
30: DISABILITIES ACTS
The
parties acknowledge that the Americans With Disabilities Act of
1990 (42 U.S.C. § 12101 et seq.) and regulations and
guidelines promulgated thereunder (“ADA”), and any
similarly motivated state and local Laws, as the same may be
amended and supplemented from time to time (collectively referred
to herein as the “Disabilities Acts”) establish
requirements for business operations, accessibility and barrier
removal, and that such requirements may or may not apply to the
Premises, Building and Property depending on, among other things:
(i) whether Tenant’s business is deemed a “public
accommodation” or “commercial facility”, (ii)
whether such requirements are “readily achievable”, and
(iii) whether a given alteration affects a “primary function
area” or triggers “path of travel” requirements.
The parties hereby agree that: (a) Landlord shall perform any
required Disabilities Acts compliance in the Common Areas, except
as provided below, (b) Tenant shall perform any required
Disabilities Acts compliance in the Premises, and (c) Landlord may
perform, or require that Tenant perform, and Tenant shall be
responsible for the cost of, Disabilities Acts “path of
travel” and other requirements triggered by any public
accommodation or other use of, or alterations in, the Premises by
Tenant. Tenant shall be responsible for Disabilities Acts
requirements relating to Tenant’s employees, and Landlord
shall be responsible for Disabilities Acts requirements relating to
Landlord’s employees.
19
SECTION
31: DEFINITIONS
(A)
“Building”
shall mean the structure (or the portion thereof operated by
Landlord) identified in Section 1 within which the Premises are
located.
(B)
“Common
Areas” shall mean the lobbies, walkways, elevators and other
portions of the Property which are provided by Landlord, from time
to time, for use in common by Landlord, Tenant and any other
tenants of the Building.
(C)
“Default
Rate” shall mean eighteen percent (18%) per annum, or the
highest rate permitted by applicable Law, whichever shall be
less.
(D)
“Holidays”
shall mean all federal holidays, and holidays observed by the State
of Washington, including New Year’s Day, President’s
Day, Memorial Day, Independence Day, Labor Day, Veterans’
Day, Thanksgiving Day, Christmas Day, and to the extent of
utilities or services provided by union members engaged at the
Property, such other holidays observed by such unions.
(E)
“Landlord”
shall mean only the landlord from time to time, except for purposes
of any provisions defending, indemnifying and holding Landlord
harmless hereunder, “Landlord” shall include past,
present and future landlords and their respective partners,
beneficiaries, trustees, officers, directors, employees,
shareholders, principals, agents, affiliates, successors and
assigns.
(F)
“Law”
or “Laws” shall mean all federal, state, county and
local governmental and municipal laws (including without limitation
Disabilities Acts), statutes, ordinances, rules, regulations,
codes, decrees, orders and other such requirements, applicable
equitable remedies and decisions by courts in cases where such
decisions are considered binding precedents in the State of
Washington, and decisions of federal courts applying the Laws of
such State, at the time in question. This Lease shall be
interpreted and governed by the Laws of the State of
Washington.
(G)
“Lender”
shall mean the holder of any Mortgage at the time in question, and
where such Mortgage is a ground lease, such term shall refer to the
ground Landlord (and the term “ground lease” although
not separately capitalized is intended throughout this Lease to
include any superior or master lease).
(H)
“Mortgage”
shall mean all mortgages, deeds of trust, ground leases and other
such encumbrances now or hereafter placed upon the Property,
Building or Premises, or any part thereof or interest therein, and
all renewals, modifications, consolidations, replacements or
extensions thereof, and all indebtedness now or hereafter secured
thereby and all interest thereon.
(I)
“Normal
Business Hours” shall mean 8:00 a.m. to 6:00 p.m. Monday
through Friday.
(J) “Premises”
shall mean the area within the Building identified in Section 1 and
Exhibit B. Possession of areas necessary for utilities, services,
safety and operation of the Building, including the Systems and
Equipment, fire stairways, perimeter walls, space between the
finished ceiling of the Premises and the slab of the floor or roof
of the Building thereabove, and the use thereof together with the
right to install, maintain, operate, repair and replace the Systems
and Equipment, including any of the same in, through, under or
above the Premises in locations that will not materially interfere
with Tenant’s use of the Premises, are hereby excepted and
reserved by Landlord, and not demised to Tenant.
(K)
“Property”
shall mean the real property legally described in Exhibit A of this
Lease together with all landscaping, improvements and personal
property located thereon and related to the Building or its
operation or maintenance.
(L)
“Rent”
shall have the meaning specified therefor in Section
4.
(M)
“Systems and
Equipment” shall mean any plant, machinery, transformers,
duct work, cable, wires, and other equipment, facilities, and
systems designed to supply light, heat, ventilation, air
conditioning and humidity, or any other services or utilities, or
comprising or serving as any component or portion of the
electrical, gas, steam, plumbing, sprinkler, communications, alarm,
security, or fire/life/safety systems or equipment, or any
elevators, escalators or other mechanical, electrical, electronic,
computer or other systems or equipment for the Building, except to
the extent that any of the same serves particular tenants
exclusively (and “systems and equipment” without
capitalization shall refer to such of the foregoing items serving
particular tenants exclusively).
(N)
“Tenant”
shall be applicable to one or more persons or entities as the case
may be, the singular shall include the plural, and if there be more
than one Tenant, the obligations thereof shall be joint and
several. When used in the lower case, “tenant” shall
mean any other tenant, subtenant or occupant of the Building or
Property.
20
(O)
“Tenant’s
Share” of Expenses and Taxes pursuant to Section 4 shall be
the percentage set forth in Section 1, but if the rentable area of
the Premises or Building shall change, Tenant’s Share shall
thereupon become the rentable area of the Premises divided by the
rentable area of the Building, excluding any parking facilities,
subject at all times to adjustment under Section 4. Tenant
acknowledges that the “rentable area of the Premises”
under this Lease includes the usable area, without deduction for
columns or projections, multiplied by a load or conversion factor,
to reflect a share of certain areas, which may include lobbies,
corridors, mechanical, utility, janitorial, boiler and service
rooms and closets, restrooms, and other public, common and service
areas, all as reasonably determined by Landlord. Except as provided
expressly to the contrary herein, the “rentable area of the
Building” shall include all rentable area of all space leased
or available for lease at the Building, which Landlord may
reasonably re determine from time to time, to reflect re
configurations, additions or modifications to the
Building.
SECTION
32: OFFER
The
submission and negotiation of this Lease shall not be deemed an
offer to enter the same by Landlord (nor an option or reservation
for the Premises), but the solicitation of such an offer by Tenant.
Tenant agrees that its execution of this Lease constitutes a firm
offer to enter the same which may not be withdrawn for a period of
thirty (30) days after delivery to Landlord. During such period and
in reliance on the foregoing, Landlord may, at Landlord’s
option, deposit any Security Deposit and Rent, proceed with any
plans, specifications, alterations or improvements, and permit
Tenant to enter the Premises, but such acts shall not be deemed an
acceptance of Tenant’s offer to enter this Lease, and such
acceptance shall be evidenced only by Landlord signing and
delivering this Lease to Tenant.
SECTION
33: MISCELLANEOUS
A. Captions
and Interpretation. The captions of the Sections of this
Lease are for convenience of reference only and shall not be
considered or referred to in resolving questions of interpretation.
Tenant acknowledges that it has read this Lease and that it has had
the opportunity to confer with counsel in negotiating this Lease;
accordingly, this Lease shall be construed neither for nor against
Landlord or Tenant, but shall be given a fair and reasonable
interpretation in accordance with the meaning of its terms. The
neuter shall include the masculine and feminine, and the singular
shall include the plural. The term “including” shall be
interpreted to mean “including, but not limited
to.”
B. Survival
of Provisions. All obligations (including indemnity, Rent
and other payment obligations) or rights of either party arising
during or attributable to the period prior to expiration or earlier
termination of this Lease shall survive such expiration or earlier
termination.
C. Severability.
If any term or provision of this Lease or portion thereof shall be
found invalid, void, illegal, or unenforceable generally or with
respect to any particular party, by a court of competent
jurisdiction, it shall not affect, impair or invalidate any other
terms or provisions or the remaining portion thereof, or its
enforceability with respect to any other party.
D. Short
Form Lease. Neither this Lease nor any memorandum of lease
or short form lease shall be recorded by Tenant, but Landlord or
any Lender may elect to record a short form of this Lease, in which
case Tenant shall promptly execute, acknowledge and deliver the
same on a form prepared by Landlord or such Lender.
E. Light,
Air and Other Interests. This Lease does not grant any legal
rights to “light and air” outside the Premises nor any
particular view visible from the Premises, nor any easements,
licenses or other interests unless expressly contained in this
Lease.
F. Authority.
If Tenant is any form of corporation, partnership, limited
liability company or partnership, association or other
organization, Tenant and all persons signing for Tenant below
hereby represent that this Lease has been fully authorized and no
further approvals are required, and Tenant is duly organized, in
good standing and legally qualified to do business in the Premises
(and has any required certificates, licenses, permits and other
such items).
G. Joint
and Several. If there is more than one Tenant, the
obligations imposed upon Tenant under this Lease shall be joint and
several. In the event that the Tenant is a married individual, the
terms, covenants and conditions of this Lease shall be binding upon
the marital community of which the Tenant is a member.
H. Financial
Statements. Tenant shall, within ten (10) days after
requested from time to time, deliver to Landlord financial
statements (including balance sheets and income/expense statements)
for Tenant’s then most recent full and partial fiscal year
preceding such request, certified by an independent certified
public accountant or Tenant’s chief financial officer, in
form reasonably satisfactory to Landlord.
21
I. Successors
and Assigns; Transfer of Property and Security Deposit. Each
of the terms and provisions of this Lease shall be binding upon and
inure to the benefit of the parties’ respective heirs,
executors, administrators, guardians, custodians, successors and
assigns, subject to Section 14 respecting Transfers and Section 17
respecting rights of Lenders. Subject to Section 17, if Landlord
shall convey or transfer the Property or any portion thereof in
which the Premises are contained to another party, such party shall
thereupon be and become landlord hereunder and shall be deemed to
have fully assumed all of Landlord’s obligations under this
Lease accruing during such party’s ownership, including the
return of any Security Deposit (provided Landlord shall have turned
over such Security Deposit to such party), and Landlord shall be
free of all such obligations accruing from and after the date of
conveyance or transfer.
J. Rent
and Taxes. In addition to the provisions of Section 15, all
Rent due Landlord herein is exclusive of any sales, business and
occupational gross receipts or tax based on rents or tax upon this
Lease or tax measured by the number of employees of Tenant or the
area of the Premises or any similar tax or charge. If any such tax
or charge be hereafter enacted, Tenant shall reimburse to Landlord
the amount thereof with each monthly Base Rent payment. If it shall
not be lawful for Tenant to so reimburse Landlord, the monthly Base
Rent payable to Landlord under this Lease shall be revised to net
Landlord the same net rental after imposition of any such tax or
charge upon Landlord as would have been payable to Landlord prior
to the imposition of such tax or charge. Tenant shall not be liable
to reimburse Landlord any federal income tax or other income tax of
a general nature applicable to Landlord’s
income.
K. Limitation
of Landlord’s Liability. Tenant agrees to look solely
to Landlord’s interest in the Building for the enforcement of
any judgment, award, order or other remedy under or in connection
with this Lease or any related agreement, instrument or document or
for any other matter whatsoever relating thereto or to the Building
or Premises. Under no circumstances shall any present or future,
direct or indirect, principals or investors, general or limited
partners, officers, directors, shareholders, trustees,
beneficiaries, participants, advisors, managers, employees, agents
or affiliates of Landlord, or of any of the other foregoing
parties, or any of their heirs, successors or assigns have any
liability for any of the foregoing matters.
L. Signage.
Landlord agrees to provide Tenant, at Landlord’s sole cost,
Building standard signage on the lobby directory board and the
principal floor where the Premises are located in a manner
consistent with other tenants in the Building.
M. Building
Renovations. It is specifically understood and
agreed that Landlord has no obligation and has made no promises to
alter, remodel, improve, renovate, repair or decorate the Premises,
Building, or any part thereof and that no representations
respecting the condition of the Premises or the Building have been
made by Landlord to Tenant except as specifically set forth herein
or in the Work Letter. However, Tenant hereby acknowledges that
Landlord is currently renovating or may during the Lease Term
renovate, improve, alter, or modify the Project, the Building
and/or the Premises (collectively, “Renovations”).
Except as specifically provided in this Lease, Tenant hereby agrees
that such Renovations shall in no way constitute a constructive
eviction of Tenant nor entitle Tenant to any abatement of Rent.
Landlord shall have no responsibility and shall not be liable to
Tenant for any injury to or interference with Tenant’s
business arising from the Renovations, nor shall Tenant be entitled
to any compensation or damages from Landlord for loss of the use of
the whole or any part of the Premises or of Tenant’s personal
property or improvements resulting from the Renovations, or for any
inconvenience or annoyance occasioned by such Renovations.
Notwithstanding the foregoing, Landlord shall use commercially
reasonable efforts to perform all Renovations in a manner, whenever
reasonably possible, to minimize any material, adverse or
unreasonable interference with Tenant’s use of or access to
the Premises.
N. Force
Majeure. Any prevention, delay or stoppage due to strikes,
lockouts, labor disputes, acts of God, acts of war, terrorist acts,
inability to obtain services, labor, or materials or reasonable
substitutes therefor, governmental actions, civil commotions, fire
or other casualty, and other causes beyond the reasonable control
of the party obligated to perform, except with respect to the
obligations imposed with regard to Rent and other charges to be
paid by Tenant pursuant to this Lease (collectively, a “Force
Majeure”), notwithstanding anything to the
contrary contained in this Lease, shall excuse the performance of
such party for a period equal to any such prevention, delay or
stoppage and, therefore, if this Lease specifies a time period for
performance of an obligation of either party, that time period
shall be extended by the period of any delay in such party’s
performance caused by a Force Majeure.
O. Patriot
Act. Tenant represents, warrants and covenants that Tenant
(i) is not listed on the Specially Designated Nationals and Blocked
Persons List maintained by the Office of Foreign Asset Control,
Department of the Treasury (“OFAC”) pursuant to
Executive Order No. 13224, 66 Fed. Reg. 49079 (Sept. 25,
2001)(“Order”) and all applicable provisions of Title
III of the USA Patriot Act (Public Law No. 107-56 (October 26,
2001)); (ii) is not listed on the Denied Persons List and Entity
List maintained by the United States Department of Commerce; (iii)
is not listed on the List of Terrorists and List of Disbarred
Parties maintained by the United States Department of State; (iv)
is not listed on any list or qualification of “Designated
Nationals” as defined in the Cuban Assets Control Regulations
31 C.F.R. Part 515; (v) is not listed on any other publicly
available list of terrorists, terrorist organizations or narcotics
traffickers maintained by the United States Department of State,
the United States Department of Commerce or any other governmental
authority or pursuant to the Order, the rules and regulations of
OFAC, or any other applicable requirements contained in any
enabling legislation or other Executive Orders in respect of the
Order (the Order and such other rules, regulations, legislation or
orders are collectively called the “Orders”); (vi) is
not engaged in activities prohibited in the Orders; and (vii) has
not been convicted, pleaded nolo contendere, indicted, arraigned or
custodially detained on charges involving money laundering or
predicate crimes to money laundering, drug trafficking,
terrorist-related activities or other money laundering predicate
crimes or in connection with the Bank Secrecy Act (31 U.S.C.
§§ 5311 et. seq.).
22
P. REIT.
Landlord and Tenant hereby agree that it is their intent that all
Rent due under this Lease shall qualify as “rents from real
property” within the meaning of Sections 512(b)(3) and 856(d)
of the Internal Revenue Code of 1986, as amended
(“Code”), and the U.S. Department of the Treasury
Regulations promulgated thereunder (“Regulations”). In
the event that (i) the Code or the Regulations, or interpretations
thereof by the Internal Revenue Service contained in revenue
rulings or other similar public pronouncements, shall be changed so
that any Rent no longer so qualifies as “rent from real
property” for purposes of either said Section 512(b)(3) or
Section 856(d) or (ii) Landlord, in its sole discretion, determines
that there is any risk that all or part of any Rent shall not
qualify as “rents from real property” for the purposes
of either said Sections 512(b)(3) or 856(d), Tenant agrees to cooperate with Landlord
and enter into such amendment or amendments to this Lease as
Landlord deems necessary to qualify all Rent as “rents from real property,” provided,
however, that (A)
any amendment required under this Section shall be made so as to
produce, to the extent possible, the equivalent (in economic terms)
Rent as payable before the amendment, and (B) in the event that Landlord
determines that an amendment cannot produce economically equivalent
Rent as described in clause (A), the Rent payable under any such
amendment shall not be any less favorable to Tenant than the Rent
payable under this Lease immediately prior to such
amendment. Additionally, no
Rent payable under this Lease may be attributable to personal
property unless (i) such personal property is leased under, or in
connection with, the lease of real property hereunder, and (ii) the
Rent attributable to the personal property for each taxable year
does not exceed 15% of the total Rent for the taxable year
attributable to both the real and personal property leased under or
in connection with this Lease. The parties agree to execute such
further commercially reasonable instrument as may reasonably be
required by Landlord in order to give effect to the foregoing
provisions of this Section.
Q. Applicable
Law and Other Matters. This Lease shall be interpreted and
construed under and pursuant to the laws of the State of
Washington. Any action regarding or arising from this Lease shall
be brought in the Washington State Superior or Federal District
Courts located in the county where the Property is located. Time is
of the essence of this Lease. In the event an attorney is engaged
by either party to enforce the terms of this Lease or in the event
suit is brought relating to or arising from this Lease, the
prevailing party shall be entitled to recover from the other party
its reasonable attorneys’ fees and costs. Landlord and Tenant
hereby waive trial by jury in any action, proceeding or
counterclaim brought by either party against the other on any
matters whatsoever arising out of this Lease, or any other
claims.
R. Confidentiality.
Tenant shall keep the content and all copies of this Lease, related
documents or amendments now or hereafter entered, and all
proposals, materials, information and matters relating thereto
strictly confidential, and shall not disclose, disseminate or
distribute any of the same, or permit the same to occur, except to
the extent reasonably required for proper business purposes by
Tenant’s employees, attorneys, insurers, auditors, lenders
and Transferees (and Tenant shall obligate any such parties to whom
disclosure is permitted to honor the confidentiality provisions
hereof), and except as may be required by Law or court
proceedings.
S. Counterparts.
This Lease may be executed in counterparts with the same effect as
if both parties hereto had executed the same document. Both
counterparts shall be construed together and shall constitute a
single lease.
SECTION
34: ENTIRE AGREEMENT
This
Lease, together with the Riders, Exhibits and other documents
listed in Section 1 (which collectively are hereby incorporated
where referred to herein and made a part hereof as though fully set
forth), contains all the terms and provisions between Landlord and
Tenant relating to the matters set forth herein and no prior or
contemporaneous agreement or understanding pertaining to the same
shall be of any force or effect, except any such contemporaneous
agreement specifically referring to and modifying this Lease,
signed by both parties. Neither this Lease, nor any Riders or
Exhibits referred to above may be modified, except in writing
signed by both parties.
[THE
REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
23
IN
WITNESS WHEREOF, the parties have executed this Lease as of the
date first set forth above.
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LANDLORD:
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XXXXX BUILDING LLC,
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a Delaware limited liability company
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By:
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Unico Boutique Office Portfolio LP, a Delaware limited partnership,
Manager
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By:
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Unico Boutique Office Portfolio GP LLC, a Delaware limited
liability company, General Partner
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By:
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Unico Investment Group LLC, a Delaware limited liability company,
Member
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By:
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/s/ Xxxxxx Xxx
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Name:
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Xxxxxx Xxx
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Title:
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VP
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TENANT:
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VISUALANT INCORPORATED,
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a Nevada corporation
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By:
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/s/
Xxx
Xxxxxxxx
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Name:
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Xxx Xxxxxxxx
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Title:
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CEO
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00
XXXXXXXX XXXXXXXXXXXXXX
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XXXXX XX XXXXXXXXXX
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)
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) ss.
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COUNTY OF KING
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)
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I
certify that I know or have satisfactory evidence that
__________________________ 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
_____________________________ of Unico Investment Group LLC, a
Delaware limited liability company, the Member of Unico Boutique
Office Portfolio GP LLC, a Delaware limited liability company, the
General Partner of Unico Boutique Office Portfolio LP, a Delaware
limited partnership, the Manager of XXXXX BUILDING LLC, a Delaware
limited liability company, to be the free and voluntary act of such
party for the uses and purposes mentioned in the
instrument.
DATED
this ______ day of ____________________, 2016.
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NOTARY PUBLIC in and for the State of Washington, residing at
__________________
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Name (printed or typed)
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My appointment expires: ___________________
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TENANT ACKNOWLEDGMENT
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STATE OF ______________
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)
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) ss.
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COUNTY OF ____________
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)
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I
certify that I know or have satisfactory evidence that
__________________________ 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 _____________________________ of
VISUALANT INCORPORATED, a Nevada corporation, to be the free and
voluntary act of such party for the uses and purposes mentioned in
the instrument.
DATED
this ______ day of ____________________, 2016.
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NOTARY PUBLIC in and for the State
of
, residing at __________________
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Name (printed or typed)
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My appointment expires: ___________________
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25
EXHIBIT A
(Legal Description of Property)
XXXX 0
XXX 00, XXXXX 17, ADDITION TO THE TOWN OF SEATTLE AS LAID OUT BY X.
X. XXXXX (COMMONLY KNOWN AS X. X. XXXXX'X 3RD ADDITION TO THE CITY
OF SEATTLE), ACCORDING TO THE PLAT THEREOF, RECORDED IN VOLUME 1 OF
PLATS, PAGE(S) 33, IN KING COUNTY, WASHINGTON;
EXCEPT
THE SOUTHERLY 5 FEET IN WIDTH OF SAID LOT 12 CONDEMNED IN KING
COUNTY SUPERIOR COURT CAUSE NUMBER 82589 FOR WIDENING OF UNION
STREET, AS PROVIDED BY ORDINANCE NUMBER 18188 OF THE CITY OF
SEATTLE;
TOGETHER
WITH THOSE EASEMENT RIGHTS APPURTENANT TO SAID PREMISES CONTAINED
IN BUILDING AGREEMENT RECORDED UNDER RECORDING NUMBER
8704210116.
THE
ABOVE ALSO BEING DESCRIBED AS FOLLOWS:
COMMENCING
AT THE MOST SOUTHERLY CORNER OF SAID LOT 12;
THENCE
NORTH 30°38'10" WEST 5.00 FEET TO THE POINT OF
BEGINNING;
THENCE
CONTINUING NORTH 30°38'10" WEST 114.92 FEET TO THE MOST
WESTERLY CORNER OF LOT 9;
THENCE
NORTH 59°22'16" EAST 119.97 FEET TO THE MOST NORTHERLY CORNER
OF LOT 9;
THENCE
SOUTH 30°37'36" EAST 114.90 FEET TO THE MOST NORTHWESTERLY
MARGIN OF UNION STREET;
THENCE
SOUTH 59°21'23" WEST 119.95 FEET TO THE POINT OF
BEGINNING;
SITUATE
IN XXX XXXX XX XXXXXXX, XXXXXX XX XXXX, XXXXX OF
WASHINGTON.
Exhibit
A-1
EXHIBIT B
(Floor Plate Showing Premises)
Exhibit
B-1
EXHIBIT C
(Work Letter)
This
Work Letter sets forth the terms and conditions relating to the
construction of improvements for the Premises.
SECTION 1
LANDLORD’S OBLIGATIONS
Except
for disbursement of the Tenant Improvement Allowance set forth
below or as otherwise set forth in the Lease, Landlord shall not be
obligated to make or pay for any alterations or improvements to the
Premises, the Building or the Project, except that Landlord will
demolish one wall, and provide a new ceiling and new PIU’s,
all of which shall be at Landlord’s sole cost and
expense.
SECTION 2
TENANT IMPROVEMENTS
2.1 Tenant
Improvement Allowance; Space Planning Allowance. Subject to
the terms and conditions contained herein, Tenant shall be entitled
to a one-time tenant improvement allowance (the “Tenant Improvement Allowance”) in
the amount of $23,575.00 (i.e., $25.00 per rentable square foot)
for the costs relating to the initial design and construction of
Tenant’s improvements (the “Tenant Improvements”), as further
described in Section 2.2.1 below. In no event shall Landlord be
obligated to make disbursements pursuant to this Work Letter in a
total amount which exceeds the Tenant Improvement Allowance.
Notwithstanding any provision to the contrary contained herein, to
the extent any portion of the Tenant Improvement Allowance is
unused by Tenant as of the date which is the first anniversary of
the Lease Commencement Date (the “Outside Date”), then the remaining
balance thereof shall revert to Landlord, and Tenant shall have no
right to use such amount for any remaining improvements or
alterations, nor as a Rent credit or cash allowance.
2.2 Disbursement
of the Tenant Improvement Allowance.
2.2.1 Tenant
Improvement Allowance Items. Except as otherwise set forth
in this Work Letter, the Tenant Improvement Allowance shall be
disbursed by Landlord only for the following items and costs
(collectively the “Tenant
Improvement Allowance Items”):
2.2.1.1 Payment
of the fees of the Architect (and any other architects retained by
Tenant, or by Architect) and the Engineers, as those terms are
defined in Section 3.1 of this Work Letter, and payment of the fees
of other professional services provided to Tenant in the design and
construction of the Tenant Improvements, and payment of the actual
and reasonable third party fees incurred by, and the cost of
documents and materials supplied by, Landlord and Landlord’s
consultants in connection with the preparation and review of the
“Construction
Drawings,” as that term is defined in Section 3.1 of
this Work Letter;
2.2.1.2 The
payment of plan check, permit and license fees relating to
construction of the Tenant Improvements;
2.2.1.3 The
cost of construction of the Tenant Improvements, including, without
limitation, testing and inspection costs, freight elevator usage,
hoisting and trash removal costs, and contractors’ fees and
general conditions;
2.2.1.4
The cost of any changes in the existing Building structure,
capacities or systems (“Base
Building”) when such changes are required by the
Construction Drawings (including, without limitation, if such
changes are due to the fact that such work is prepared on an
unoccupied basis), such cost to include all direct architectural
and/or engineering fees and expenses incurred in connection
therewith;
2.2.1.5 The
cost of any changes to the Construction Drawings or Tenant
Improvements required by all applicable building codes (the
“Code”);
2.2.1.6 Sales
and use taxes;
2.2.1.7
A construction supervision fee payable to Unico Properties LLC
(Landlord’s property manager) equal to 4.0% of the Final
Costs (as defined below) of the Tenant Improvements;
and
2.2.1.8 Any
other out-of-pocket costs expended by Landlord in payment of cost
items included in the Final Costs (as defined in Section 4.2.1
below) as agreed by Tenant, or as a result of Tenant’s
failure to perform its obligations in connection with the
construction of the Tenant Improvements.
2.2.2 Disbursement
of Tenant Improvement Allowance. Upon written request from
Tenant, Landlord shall disburse the Tenant Improvement Allowance
(or the remaining portion thereof after disbursement to third
parties for any Tenant Improvement Allowance Items) to Tenant
within thirty (30) days after Tenant has opened for business,
completed construction of the Tenant Improvements, and delivered to
Landlord the following:
Exhibit
C-1
2.2.2.1
A detailed Final Costs statement showing the actual total costs of
construction of the Tenant Improvements;
2.2.2.2
A complete list of the names, addresses, telephone numbers and
contract amounts for all Tenant's contractor, subcontractors,
vendors and/or suppliers of labor and/or materials for Tenant's
Work providing work, services and/or material in excess of
$5,000.00 (“Major Contractors”);
2.2.2.3
All mechanics' lien releases or other lien releases on account of
Tenant's Work from Major Contractors, which are notarized,
unconditional and in recordable form or in such form as Landlord
shall have approved;
2.2.2.4
Copies of all building permits, indicating inspection and approval
of the Premises by the issuer of said permits;
2.2.2.5
An architect's certification that the Premises have been
constructed in accordance with the Approved Working Drawings
(defined below); and
2.2.2.6
(i) Final unconditional waivers of liens, contractors'
affidavits, and architects' certificates in such form as may be
required by Landlord and Landlord's title insurance company from
all parties performing labor or supplying materials or services in
connection with the Tenant Improvements showing that all of said
parties have been compensated in full and waiving all liens, to the
extent not already waived as provided above; (ii) a
certificate of occupancy or equivalent as required to occupy the
Premises; (iii) "as built" drawings and other final
documentation; and (iv) a detailed breakdown of Tenant's total
construction costs. The “as built” drawings and other
final documentation shall include the following:
●
Electrical sub
letter confirming electrical panels updated with all
circuits
●
HVAC balance
reports
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Electrical phase
balance reports
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Updated fire alarm
points list
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As – built
drawings in ACAD and PDF
●
O&M manuals
inclusive of all submittals and finishes
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Warranties of
Contractor and subcontractors
●
AutoCAD files in an
AIA standard layering system, and pdf disk set via e-mail of
architectural and MEP
●
As built controls
instruction and sequence of operation
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Fan, pump, and
balancing valve curves
●
Updated valve
schedules
●
Valve schedule
indicating valve tag number, location by room number, valve purpose
and size, indicate damper locations and purpose. This information
to be included for the following systems: 1. Refrigerant system 2.
HVAC system 3. Exhaust system 4. Plumbing and HVAC piping systems
5. Temperature control system 6. Any other system installed but not
listed above.
In no
event shall the portion of the Tenant Improvement Allowance
disbursed directly to Tenant exceed the actual out-of-pocket costs
incurred by Tenant for construction of the Tenant
Improvements.
SECTION 3
CONSTRUCTION DRAWINGS
3.1 Selection
of Architect/Construction Drawings. Tenant shall retain an
architect/space planner reasonably approved by Landlord (the
“Architect”) to
prepare the “Construction
Drawings,” as that term is defined in this Section
3.1. Tenant shall retain engineering consultants approved by
Landlord (the “Engineers”) to prepare all plans
and engineering working drawings relating to the structural,
mechanical, electrical, plumbing, HVAC, life safety, and sprinkler
work in the Premises, which work is not part of the Base Building.
Landlord’s approval of the Engineers shall not be
unreasonably withheld and Landlord shall be deemed to have approved
the Engineers proposed by Tenant if Landlord does not provide
written notice of disapproval within five (5) business days after
Tenant’s written request for approval. The plans and drawings
to be prepared by Architect and the Engineers hereunder shall be
known collectively as the “Construction Drawings.” All Construction
Drawings shall be subject to Landlord’s approval, which shall
not be unreasonably withheld, conditioned or delayed. Tenant and
Architect shall verify, in the field, the dimensions and conditions
as shown on the relevant portions of the Base Building plans, and
Tenant and Architect shall be solely responsible for the same, and
Landlord shall have no responsibility in connection therewith.
Landlord’s review of the Construction Drawings as set forth
in this Section 3, shall be for its sole purpose and shall not
imply Landlord’s review of the same, or obligate Landlord to
review the same, for quality, design, Code compliance or other like
matters. Accordingly, notwithstanding that any Construction
Drawings are reviewed by Landlord or its space planner, architect,
engineers and consultants, and notwithstanding any advice or
assistance which may be rendered to Tenant by Landlord or
Landlord’s space planner, architect, engineers, and
consultants, Landlord shall have no liability whatsoever in
connection therewith and shall not be responsible for any omissions
or errors contained in the Construction Drawings, and
Tenant’s waiver and indemnity set forth in this Lease shall
specifically apply to the Construction Drawings.
Exhibit
C-2
3.2 Final
Space Plan. Tenant shall supply Landlord with four (4)
copies signed by Tenant of its final space plan for the Premises
before any architectural working drawings or engineering drawings
have been commenced. The final space plan (the “Final Space Plan”) shall include a
layout and designation of all offices, rooms and other
partitioning, their intended use, and equipment to be contained
therein, as well as the storefront and façade of the Premises.
Landlord may request clarification or more specific drawings for
special use items not included in the Final Space Plan. Landlord
shall advise Tenant within five (5) business days after
Landlord’s receipt of the Final Space Plan for the Premises
if the same is unsatisfactory or incomplete in any respect. If
Tenant is so advised, Tenant shall promptly cause the Final Space
Plan to be revised to correct any deficiencies or other matters
Landlord may reasonably require. Notwithstanding anything to the
contrary in this Section 3.2, Landlord shall not unreasonably
withhold, condition or delay its approval of the Final Space Plan;
provided, however, that to the extent that such Final Space Plan
may (i) affect the exterior of the Building, (ii) adversely affect
the structural portions of the Building, (iii) adversely affect the
Building systems and equipment, (iv) unreasonably interfere with
any other occupant’s normal and customary office operation,
(v) fail to comply with Applicable Laws, or (vi) fail to meet or
exceed the Specifications, then Landlord may grant or withhold its
approval of such Final Space Plan in its sole
discretion.
3.3 Final
Working Drawings. After the Final Space Plan has been
approved by Landlord, Tenant shall supply the Engineers with a
complete listing of standard and non-standard equipment and
specifications, including, without limitation, B.T.U. calculations,
electrical requirements and special electrical receptacle
requirements for the Premises, to enable the Engineers and the
Architect to complete the “Final Working Drawings” (as that
term is defined below) in the manner as set forth below. Upon the
approval of the Final Space Plan by Landlord and Tenant, Tenant
shall promptly cause the Architect and the Engineers to complete
the architectural and engineering drawings for the Premises, and
Architect shall compile a fully coordinated set of architectural,
structural, mechanical, electrical and plumbing working drawings in
a form which is complete to allow subcontractors to bid on the work
and to obtain all applicable permits (collectively, the
“Final Working
Drawings”) and shall submit the same to Landlord for
Landlord’s approval. Tenant shall supply Landlord with four
(4) copies signed by Tenant of such Final Working Drawings.
Landlord shall advise Tenant within five (5) business days after
Landlord’s receipt of the Final Working Drawings for the
Premises if the same is unsatisfactory or incomplete in any
respect. If Tenant is so advised, Tenant shall immediately revise
the Final Working Drawings in accordance with such review and any
disapproval of Landlord in connection therewith and resubmit them
to Landlord. Landlord shall advise Tenant within five (5) business
days after Landlord’s receipt of any revised Final Working
Drawings for the Premises if the same is unsatisfactory or
incomplete in any respect. Notwithstanding anything to the contrary
in this Section 3.3, Landlord shall not unreasonably withhold,
condition or delay its approval of the Final Working Drawings;
provided, however, that to the extent that such Final Working
Drawings may (i) affect the exterior appearance of the Building,
(ii) adversely affect the structural portions of the Building,
(iii) adversely affect the Building systems and equipment, (iv)
unreasonably interfere with any other occupant’s normal and
customary office operation, (v) fail to comply with Applicable
Laws, or (vi) fail to meet or exceed the Specifications, then
Landlord may grant or withhold its approval of such Final Working
Drawings in its sole discretion. Once approved by Landlord, the
Final Working Drawings are the “Approved Working
Drawings”.
3.4 Approved
Working Drawings. After approval by Landlord of the Final
Working Drawings, Tenant may submit the same to the appropriate
municipal authorities for all applicable building permits. Tenant
hereby agrees that neither Landlord nor Landlord’s
consultants shall be responsible for obtaining any building permit
or certificate of occupancy for the Premises and that obtaining the
same shall be Tenant’s responsibility; provided, however,
that Landlord shall timely cooperate with Tenant in executing
permit applications and performing other ministerial acts
reasonably necessary to enable Tenant to obtain any such permit or
certificate of occupancy. No changes, modifications or alterations
in the Approved Working Drawings may be made without the prior
written consent of Landlord, which consent may not be unreasonably
withheld, conditioned or delayed.
SECTION 4
CONSTRUCTION OF THE TENANT IMPROVEMENTS
4.1 Tenant’s
Selection of Contractors.
4.1.1 The
Contractor. A general contractor shall be retained by Tenant
to construct the Tenant Improvements. Such general contractor
(“Contractor”)
shall be selected by Tenant subject to Landlord’s prior
approval, which approval shall not be unreasonably withheld,
conditioned or delayed. Tenant shall have the right, but not the
obligation, to submit the Tenant Improvements for competitive
bidding to two (2) or more general contractors.
4.1.2 Tenant’s
Agents. All subcontractors used by Tenant (such
subcontractors, and the Contractor, to be known collectively as
“Tenant’s
Agents”) must be
approved in writing by Landlord, which approval shall not be
unreasonably withheld, conditioned or delayed. If Landlord does not
approve any of Tenant’s proposed subcontractors, Tenant shall
submit other proposed subcontractors for Landlord’s written
approval. Landlord shall either approve or disapprove (with
specific reasons for such disapproval) such Tenant’s Agents
within five (5) days after Landlord’s receipt of
Tenant’s request. The subcontractors set forth on
Annex B hereto are
hereby approved by Landlord.
Exhibit
C-3
4.2 Construction
of Tenant Improvements by Tenant’s
Agents.
4.2.1 Construction
Contract; Cost Budget. Prior to the commencement of the
construction of the Tenant Improvements, and after Tenant has
accepted all bids for the Tenant Improvements, Tenant shall provide
Landlord with a detailed breakdown, by trade, of the final costs to
be incurred or which have been incurred, in connection with the
design and construction of the Tenant Improvements to be performed
by or at the direction of Tenant or the Contractor, which costs
form a basis for the amount of the construction contract and
general conditions with Contractor (the “Final Costs”).
4.2.2 Tenant’s
Agents.
4.2.2.1 Landlord’s
General Conditions for Tenant’s Agents and Tenant Improvement
Work. Tenant’s and Tenant’s Agent’s
construction of the Tenant Improvements shall comply with the
following: (i) the Tenant Improvements shall be constructed in
strict accordance with the Approved Working Drawings; (ii)
Tenant’s Agents shall submit schedules of all work relating
to the Tenant’s Improvements to Contractor and Contractor
shall, within five (5) business days of receipt thereof, inform
Tenant’s Agents of any changes which are necessary thereto,
and Tenant’s Agents shall adhere to such corrected schedule;
and (iii) Tenant shall abide by Landlord’s rules and
regulations with respect to the use of freight, loading dock and
service elevators, storage of materials, coordination of work with
the contractors of other tenants, and any other matter in
connection with this Work Letter, including, without limitation,
the construction of the Tenant Improvements, which rules and
regulations are attached hereto as Annex C. Tenant shall not pay a
construction supervision or management fee to Landlord in
connection with the Tenant Improvements (but a construction
supervision fee shall be included as a Tenant Improvement Allowance
Item as provided in Section 2.2 above).
4.2.2.2 Indemnity.
Tenant’s indemnity of Landlord as set forth in this Lease
shall also apply with respect to any and all third party claims for
costs, losses, damages, injuries and liabilities related in any way
to any act or omission of Tenant or Tenant’s Agents, or
anyone directly or indirectly employed by any of them in connection
with the Tenant Improvements, or in connection with Tenant’s
non-payment of any amount arising out of the Tenant Improvements
and/or Tenant’s disapproval of all or any portion of any
request for payment.
4.2.2.3 Insurance
Requirements.
4.2.2.3.1 General
Coverages. All of Tenant’s Agents shall carry (a)
worker’s compensation insurance as required by law covering
all of their respective employees, (b) Employer’s Liability
with minimum coverages of minimum of $500,000 each accident;
$500,000 disease, policy limit; $500,000 disease, per employee; (c)
Broad Form Commercial General Liability (naming Landlord and its
property manager as additional insureds) with policy limits of
$1,000,000 per occurrence Combined Single Limit and $3,000,000
aggregate (i.e., such insurance shall be broad form and shall
include contractual liability, personal injury protection and
completed operations coverage); (d) Auto Liability with coverage of
at least $1,000,000; and (e) Property Insurance coverage for tools
and equipment brought onto and/or used on any Property by the
applicable contractor in an amount equal to the replacement costs
of all such tools and equipment.
4.2.2.3.2 Builder’s
Risk Coverages. Tenant or Tenant’s Contractor shall
carry “Builder’s All Risk” insurance in an amount
approved by Landlord covering the construction of the Tenant
Improvements, and such other insurance as Landlord may reasonably
require, it being understood and agreed that the Tenant
Improvements shall be insured by Tenant pursuant to this Lease
immediately upon completion thereof. Such insurance shall be in
amounts and shall include such extended coverage endorsements as
may be reasonably required by Landlord including, but not limited
to, the requirement that all of Tenant’s Agents shall carry
excess liability and Products and Completed Operation Coverage
insurance, each in amounts not less than $500,000 per incident,
$1,000,000 in aggregate, and in form and with companies as are
required to be carried by Tenant as set forth in this
Lease.
4.2.2.3.3 General
Terms. Certificates for all insurance carried pursuant to
this Section 4.2.2.3 shall be delivered to Landlord before the
commencement of construction of the Tenant Improvements and before
the Contractor’s equipment is moved onto the site. All such
policies of insurance must contain a provision that the company
writing said policy will give Landlord thirty (30) days prior
written notice of any cancellation or lapse of the effective date
or any reduction in the amounts of such insurance. In the event
that the Tenant Improvements are damaged by any cause during the
course of the construction thereof, Tenant shall immediately direct
its Contractor or Tenants Agents as appropriate to repair the same
at Tenant’s sole cost and expense. Tenant’s Agents
shall maintain all of the foregoing insurance coverage in force
until the Tenant Improvements are fully completed and accepted by
Landlord pursuant to this Work Letter, except for any Products and
Completed Operation Coverage insurance required by Landlord, which
is to be maintained for one (1) year following completion of the
work and acceptance by Landlord and Tenant. All policies carried
under this Section 4.2.2.3 shall insure Landlord and Tenant, as
their interests may appear, as well as Contractor and
Tenant’s Agents. All insurance, except Workers’
Compensation, maintained by Tenant’s Agents shall preclude
subrogation claims by the insurer against anyone insured
thereunder. Such insurance shall provide that it is primary
insurance as respects the owner and that any other insurance
maintained by owner is excess and noncontributing with the
insurance required hereunder. The requirements for the foregoing
insurance shall not derogate from the provisions for
indemnification of Landlord by Tenant under Section 4.2.2.2 of this
Work Letter. Landlord may, in its reasonable discretion, require
Tenant to obtain a lien and completion bond or some alternate form
of security reasonably satisfactory to Landlord in an amount
sufficient to ensure the lien-free completion of the Tenant
Improvements and naming Landlord as a co-obligee.
Exhibit
C-4
4.2.3 Governmental
Compliance. The Tenant Improvements shall comply in all
respects with the following: (i) the Code and other state, federal,
city or quasi-governmental laws, codes, ordinances and regulations,
as each may apply according to the rulings of the controlling
public official, agent or other person; (ii) applicable standards
of the American Insurance Association (formerly, the National Board
of Fire Underwriters) and the National Electrical Code; and (iii)
building material manufacturer’s specifications.
4.2.4 Inspection
by Landlord. Upon reasonable prior notice to Tenant,
Landlord shall have the right to inspect the Tenant Improvements at
all times, provided however, that Landlord’s failure to
inspect the Tenant Improvements shall in no event constitute a
waiver of any of Landlord’s rights hereunder nor shall
Landlord’s inspection of the Tenant Improvements constitute
Landlord’s approval of the same. Landlord shall conduct any
such inspections in a manner so as to minimize any disruption of
construction of the Tenant Improvements. Should Landlord reasonably
and in good faith disapprove any portion of the Tenant
Improvements, Landlord shall notify Tenant in writing of such
disapproval and shall specify the items disapproved. Any such
reasonable and good faith disapproval by Landlord of any portion of
the Tenant Improvements shall be rectified by Tenant at no expense
to Landlord, provided however, that in the event Landlord
determines that a defect or deviation exists or disapproves of any
matter in connection with any portion of the Tenant Improvements
and such defect, deviation or matter might adversely affect the
mechanical, electrical, plumbing, heating, ventilating and air
conditioning or life-safety systems of the Building, the structure
or exterior appearance of the Building or any other tenant’s
use of such other tenant’s leased premises, Landlord may,
take such action as Landlord deems necessary, at Tenant’s
expense and without incurring any liability on Landlord’s
part, to correct any such defect, deviation and/or matter,
including, without limitation, causing the cessation of performance
of the construction of the Tenant Improvements until such time as
the defect, deviation and/or matter is corrected to
Landlord’s satisfaction.
4.2.5 Meetings.
Commencing upon the execution of this Lease, Tenant shall hold
weekly meetings at a reasonable time, with the Architect and the
Contractor regarding the progress of the preparation of
Construction Drawings and the construction of the Tenant
Improvements, which meetings may be held by teleconference or at a
mutually convenient location in the Seattle area agreed upon by
Tenant and Landlord, and Landlord and/or its agents shall receive
prior notice of, and shall have the right to attend, all such
meetings, and, upon Landlord’s request, certain of
Tenant’s Agents shall attend such meetings. In addition,
minutes shall be taken at all such meetings, a copy of which
minutes shall be promptly delivered to Landlord.
4.3 Copy
of Record Set of Plans. At the conclusion of construction,
(i) Tenant shall cause the Architect and Contractor (A) to update
the Approved Working Drawings as necessary to reflect all changes
made to the Approved Working Drawings during the course of
construction, (B) to certify to the best of their knowledge that
the “record-set” of as-built drawings are true and
correct, which certification shall survive the expiration or
termination of this Lease, and (C) to deliver to Landlord two (2)
sets of copies of such record set of drawings within ninety (90)
days following issuance of a certificate of occupancy for the
Premises, and (ii) Tenant shall deliver to Landlord a copy of all
warranties, guaranties, and operating manuals and information
relating to the improvements, equipment, and systems in the
Premises.
SECTION 5
MISCELLANEOUS
5.1 Representatives.
Tenant’s Representative means _________________ (phone:
______________; e-mail: _________________). Until
further notice to Landlord, such Tenant’s Representative
shall have full authority and responsibility to act on behalf of
the Tenant as required in this Work Letter. Landlord’s
Representative shall mean Xxxxx Xxxx (phone:
000-000-0000; e-mail:
xxxxxxxxx@xxxxxxxxx.xxx)
and Xxx Xxxxxxxx (phone: 000-000-0000; e-mail:
xxxx@xxxxxxxxx.xxx).
5.2 Time
of the Essence in This Work Letter. Unless otherwise
indicated, all references herein to a “number of days”
shall mean and refer to calendar days. If any item requiring
approval is timely disapproved by Landlord, the procedure for
preparation of the document and approval thereof shall be repeated
until the document is approved by Landlord.
5.3 Tenant’s
Lease Default. Notwithstanding any provision to the contrary
contained in this Lease, if an event of default as described in the
Lease has occurred at any time on or before the completion of the
Premises, and such default is not cured within the applicable cure
period set forth in the Lease, then (i) in addition to all other
rights and remedies granted to Landlord pursuant to the Lease,
Landlord shall have the right to withhold payment of all or any
portion of the Tenant Improvement Allowance until such time as such
default is cured pursuant to the terms of the Lease and/or Landlord
may cause Contractor to cease the construction of the Premises
until such time as such default is cured pursuant to the terms of
the Lease (in which case, Tenant shall be responsible for any delay
in the completion of the Premises caused by such work stoppage),
and (ii) all other obligations of Landlord under the terms of this
Work Letter shall be forgiven until such time as such default is
cured pursuant to the terms of the Lease (in which case, Tenant
shall be responsible for any delay in the completion of the
Premises caused by such inaction by Landlord).
Exhibit
C-5
RIDER ONE
RULES
(1) Access to Property. On Saturdays,
Sundays and Holidays, and on other days between the hours of 6:00
P.M. and 8:00 A.M. the following day, or such other hours as
Landlord shall determine from time to time, access to and within
the Property and/or to the passageways, lobbies, entrances, exits,
loading areas, corridors, elevators or stairways and other areas in
the Property may be restricted and access gained by use of a key to
the outside doors of the Property, or pursuant to such security
procedures Landlord may from time to time impose. Landlord shall in
all cases retain the right to control and prevent access to such
areas by Persons engaged in activities which are illegal or violate
these Rules, or whose presence in the judgment of Landlord shall be
prejudicial to the safety, character, reputation and interests of
the Property and its tenants (and Landlord shall have no liability
in damages for such actions taken in good faith). No Tenant and no
employee or invitee of Tenant shall enter areas reserved for the
exclusive use of Landlord, its employees or invitees or other
Persons. Tenant shall keep doors to corridors and lobbies closed
except when persons are entering or leaving.
(2) Signs. Tenant shall not paint, display,
inscribe, maintain or affix any sign, placard, picture,
advertisement, name, notice, lettering or direction on any part of
the outside or inside of the Property, or on any part of the inside
of the Premises which can be seen from the outside of the Premises
without the prior consent of Landlord, and then only such name or
names or matter and in such color, size, style, character and
material, and with professional designers, fabricators and
installers as may be first approved or designated by Landlord in
writing. Landlord shall prescribe the suite number and
identification sign for the Premises (which shall be prepared and
installed by Landlord at Tenant’s expense). Landlord reserves
the right to remove at Tenant’s expense all matter not so
installed or approved without notice to Tenant.
(3) Window and Door Treatments. Tenant shall
not place anything or allow anything to be placed in the Premises
near the glass of any door, partition, wall or window which may be
unsightly from outside the Premises, and Tenant shall not place or
permit to be placed any item of any kind on any window ledge or on
the exterior walls. Blinds, shades, awnings or other forms of
inside or outside window ventilators or similar devices, shall not
be placed in or about the outside windows or doors in the Premises
except to the extent, if any, that the design, character, shape,
color, material and make thereof is first approved or designated by
the Landlord. Tenant shall not install or remove any solar tint
film from the windows.
(4) Lighting and General Appearance of
Premises. Landlord reserves the right to designate and/or
approve in writing all internal lighting that may be visible from
the public, common or exterior areas. The design, arrangement,
style, color, character, quality and general appearance of the
portion of the Premises visible from public, common and exterior
areas, and contents of such portion of the Premises, including
furniture, fixtures, signs, art work, wall coverings, carpet and
decorations, and all changes, additions and replacements thereto
shall at all times have a neat, professional, attractive, first
class office appearance.
(5) Property Trade Name, Likeness,
Trademarks. Tenant shall not in any manner use the name of
the Property for any purpose, or use any trade names or trademarks
used by Landlord, any other tenant, or its affiliates, or any
picture or likeness of the Property for any purpose other than that
of the business address of Tenant, in any letterheads, envelopes,
circulars, notices, advertisements, containers, wrapping or other
material.
(6) Deliveries and Removals. Furniture,
freight and other large or heavy items, and all other deliveries
may be brought into the Property only at times and in the manner
designated by Landlord, and always at the Tenant’s sole
responsibility and risk. Landlord may inspect items brought into
the Property or Premises with respect to weight or dangerous nature
or compliance with this Lease or Laws. Landlord may (but shall have
no obligation to) require that all furniture, equipment, cartons
and other items removed from the Premises or the Property be listed
and a removal permit therefor first be obtained from Landlord.
Tenant shall not take or permit to be taken in or out of other
entrances or elevators of the Property, any item normally taken, or
which Landlord otherwise reasonably requires to be taken, in or out
through service doors or on freight elevators. Landlord may impose
reasonable charges and requirements for the use of freight
elevators and loading areas, and reserves the right to alter
schedules without notice. Any hand carts used at the Property shall
have rubber wheels and sideguards, and no other material handling
equipment may be brought upon the Property without Landlord’s
prior written approval.
(7) Outside Vendors. Tenant shall not obtain
for use upon the Premises ice, drinking water, vending machine,
towel, janitor and other services, except from Persons designated
or approved by Landlord. Any Person engaged by Tenant to provide
any other services shall be subject to scheduling and direction by
the manager or security personnel of the Property. Vendors must use
freight elevators and service entrances.
(8) Overloading Floors; Vaults. Tenant shall
not overload any floor or part thereof in the Premises, or
Property, including any public corridors or elevators therein
bringing in or removing any large or heavy items, and Landlord may
prohibit, or direct and control the location and size of, safes and
all other heavy items and require at Tenant’s expense
supplementary supports of such material and dimensions as Landlord
may deem necessary to properly distribute the weight.
Rider One -
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(9) Locks and Keys. Tenant shall use such
standard key system designated by Landlord on all keyed doors to
and within the Premises, excluding any permitted vaults or safes
(but Landlord’s designation shall not be deemed a
representation of adequacy to prevent unlawful entry or criminal
acts, and Tenant shall maintain such additional insurance as Tenant
deems advisable for such events). Tenant shall not attach or permit
to be attached additional locks or similar devices to any door or
window, change existing locks or the mechanism thereof, or make or
permit to be made any keys for any door other than those provided
by Landlord. If more than two keys for one lock are desired,
Landlord will provide them upon payment of Landlord’s
charges. In the event of loss of any keys furnished by Landlord,
Tenant shall pay Landlord’s reasonable charges therefor. The
term “key” shall include mechanical, electronic or
other keys, cards and passes. Landlord shall not be liable for the
consequences of admitting by pass key or refusing to admit to the
Premises the Tenant, Tenant’s agent or employees or other
persons claiming the right of admittance.
(10) Utility
Closets and Connections. Landlord reserves the right to
control access to and use of, and monitor and supervise any work in
or affecting, the “wire” or telephone, electrical,
plumbing or other utility closets, the Systems and Equipment, and
any changes, connections, new installations, and wiring work
relating thereto (or Landlord may engage or designate an
independent contractor to provide such services). Tenant shall
obtain Landlord’s prior written consent for any such access,
use and work in each instance, and shall comply with such
requirements as Landlord may impose, and the other provisions of
the Lease respecting electric installations and connections,
telephone Lines and connections, and alterations generally. Tenant
shall have no right to use any broom closets, storage closets,
janitorial closets, or other such closets, rooms and areas
whatsoever. Tenant shall not install in or for the Premises any
equipment which requires more electric current than Landlord is
required to provide under this Lease, without Landlord’s
prior written approval, and Tenant shall ascertain from Landlord
the maximum amount of load or demand for or use of electrical
current which can safely be permitted in and for the Premises,
taking into account the capacity of electric wiring in the Property
and the Premises and the needs of tenants of the Property, and
shall not in any event connect a greater load than such safe
capacity.
(11) Plumbing
Equipment. The toilet rooms, urinals, wash bowls, drains,
sewers and other plumbing fixtures, equipment and lines shall not
be misused or used for any purpose other than that for which they
were constructed and no foreign substance of any kind whatsoever
shall be thrown therein.
(12) Trash.
All garbage, refuse, trash and other waste shall be kept in the
kind of container, placed in the areas, and prepared for collection
in the manner and at the times and places specified by Landlord,
subject to Lease provisions respecting Hazardous Materials.
Landlord reserves the right to require that Tenant participate in
any recycling program designated by Landlord.
(13) Alcohol,
Drugs, Food and Smoking. Landlord reserves the right to
exclude or expel from the Property any person who, in the judgment
of Landlord, is intoxicated or under the influence of liquor or
drugs, or who shall in any manner do any act in violation of any of
these Rules. Tenant shall not at any time manufacture or sell any
spirituous, fermented, intoxicating or alcoholic liquors on the
Premises, nor permit the same to occur. Tenant shall not at any
time xxxx, sell, purchase or give away, food in any form by or to
any of Tenant’s agents or employees or any other parties on
the Premises, nor permit any of the same to occur (other than in
microwave ovens and coffee makers properly maintained in good and
safe working order and repair in lunch rooms or kitchens for
employees as may be permitted or installed by Landlord, which does
not violate any Laws or bother or annoy any other tenant). Tenant
and its employees shall not smoke tobacco on any part of the
Property (including exterior areas) except those areas, if any,
that are designated or approved as smoking areas by
Landlord.
(14) Use
of Common Areas; No Soliciting. Tenant shall not use the
Common Areas, including areas adjacent to the Premises, for any
purpose other than ingress and egress, and any such use thereof
shall be subject to the other provisions of this Lease, including
these Rules. Without limiting the generality of the foregoing,
Tenant shall not allow anything to remain in any passageway,
sidewalk, court, corridor, stairway, entrance, exit, elevator,
parking or shipping area, or other area outside the Premises.
Tenant shall not use the Common Areas to canvass, solicit business
or information from, or distribute any item or material to, other
tenants or invitees of the Property. Tenant shall not make any room
to room canvass to solicit business or information or to distribute
any item or material to or from other tenants of the Property and
shall not exhibit, sell or offer to sell, use, rent or exchange any
products or services in or from the Premise unless ordinarily
embraced within the Tenant’s use of the Premises expressly
permitted in the Lease.
(15) Energy
and Utility Conservation. Tenant shall not waste
electricity, water, heat or air conditioning or other utilities or
services, and agrees to cooperate fully with Landlord to assure the
most effective and energy efficient operation of the Property and
shall not allow the adjustment (except by Landlord’s
authorized Property personnel) of any controls. Tenant shall not
obstruct, alter or impair the efficient operation of the Systems
and Equipment, and shall not place any item so as to interfere with
air flow. Tenant shall keep corridor doors closed and shall not
open any windows, except that if the air circulation shall not be
in operation, windows which are openable may be opened with
Landlord’s consent. If reasonably requested by Landlord (and
as a condition to claiming any deficiency in the air-conditioning
or ventilation services provided by Landlord), Tenant shall close
any blinds or drapes in the Premises to prevent or minimize direct
sunlight.
Rider One -
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(16) Unattended
Premises. Before leaving the Premises unattended, Tenant
shall close and securely lock all doors or other means of entry to
the Premises and shut off all lights and water faucets in the
Premises (except heat to the extent necessary to prevent the
freezing or bursting of pipes).
(17) Going-Out-Of-Business
Sales and Auctions. Tenant shall not use, or permit any
other party to use, the Premises for any distress, fire,
bankruptcy, close-out, “lost our lease” or
going-out-of-business sale or auction. Tenant shall not display any
signs advertising the foregoing anywhere in or about the Premises.
This prohibition shall also apply to Tenant’s
creditors.
(18) Labor
Harmony. Tenant shall not use (and upon notice from Landlord
shall cease using) contractors, services, workmen, labor, materials
or equipment, or labor and employment practices that, in
Landlord’s good faith judgment, may cause strikes, picketing
or boycotts or disturb labor harmony with the workforce or trades
engaged in performing other work, labor or services in or about the
Property.
(19) Prohibited
Activities. Tenant shall not: (i) use strobe or flashing
lights in or on the Premises, (ii) install or operate any internal
combustion engine, boiler, machinery, refrigerating, heating or air
conditioning equipment in or about the Premises, (iii) use the
Premises for housing, lodging or sleeping purposes or for the
washing of clothes, (iv) place any radio or television antennae
other than inside of the Premises, (v) operate or permit to be
operated any musical or sound producing instrument or device which
may be heard outside the Premises, (vi) use any source of power
other than electricity, (vii) operate any electrical or other
device from which may emanate electrical, electromagnetic, energy,
microwave, radiation or other waves or fields which may interfere
with or impair radio, television, microwave, or other broadcasting
or reception from or in the Property or elsewhere, or impair or
interfere with computers, faxes or telecommunication lines or
equipment at the Property or elsewhere, or create a health hazard,
(viii) bring or permit any bicycle or other vehicle, or dog (except
in the company of a blind person or except where specifically
permitted) or other animal or bird in the Premises or Building,
(ix) make or permit objectionable noise, vibration or odor to
emanate from the Premises, (x) do anything in or about the Premises
or Property that is illegal, immoral, obscene, pornographic, or
anything that may in Landlord’s good faith opinion create or
maintain a nuisance, cause physical damage to the Premises or
Property, interfere with the normal operation of the Systems and
Equipment, impair the appearance, character or reputation of the
Premises or Property, create waste to the Premises or Property,
cause demonstrations, protests, loitering, bomb threats or other
events that may require evacuation of the Building, (xi) advertise
or engage in any activities which violate any code of ethics or
licensing requirements of any professional or business
organization, (xii) throw or permit to be thrown or dropped any
item from any window or other opening in the Property, (xiii) use
the Premises for any purpose, or permit upon the Premises or
Property anything, that may be dangerous to persons or property
(including firearms or other weapons (whether or not licensed or
used by security guards) or any explosive or combustible items or
materials) (xiv) place vending or game machines in the Premises,
except vending machines for employees which shall be at
Tenant’s sole cost and expense and only upon prior notice to
and consent of Landlord, (xv) adversely affect the indoor air
quality of the Premises or Property, (xvi) use the Premises for
cooking or food preparation other than preparation of coffee, tea
and similar beverages, or customary microwave use, for Tenant and
its employees, or (xvii) do or permit anything to be done upon the
Premises or Property in any way tending to disturb, bother, annoy
or interfere with Landlord or any other tenant at the Property or
the tenants of neighboring property, or otherwise disrupt orderly
and quiet use and occupancy of the Property.
(20) Transportation
Management. Tenant shall comply with all present or future
programs intended to manage parking, transportation or traffic in
and around the Property, and in connection therewith, Tenant shall
take responsible action for the transportation planning and
management of all employees located at the Premises by working
directly with Landlord, any governmental transportation management
organization or any other transportation-related committees or
entities.
(21) Parking.
Subject to any contrary provisions of this Lease, if the Property
now or hereafter contains, or Landlord has obtained the right to
use for the Property, a parking garage, structure, facility or
area, the following Rules shall apply therein:
(i) Parking shall be
available in areas designated by Landlord from time to time, and
for such daily or monthly charges as Landlord may establish from
time to time. Parking for Tenant and its employees and visitors
shall be on a “first come, first served,” unassigned
basis, in common with Landlord and other tenants at the Property,
and their employees and visitors, and other Persons to whom
Landlord shall grant the right or who shall otherwise have the
right to use the same. However, in no event shall Tenant and
Tenant’s employees and visitors use more spaces than the
number derived by applying Tenant’s Pro Rata Share (as
defined in the Lease) to the total number of unassigned spaces in
the area or areas designated by Landlord from time to time to serve
the Premises. In addition, Landlord reserves the right to: (x)
adopt additional requirements or procedures pertaining to parking,
including systems with charges favoring carpooling, and validation
systems, (y) assign specific spaces, and reserve spaces for small
and other size cars, disabled persons, and other tenants, customers
of tenants or other parties, and (z) restrict or prohibit full size
vans and other large vehicles.
(ii) Monthly
fees shall be paid in advance prior to the first of each month.
Failure to do so will automatically cancel parking privileges, and
incur a charge at the posted daily parking rate. No deductions from
the monthly rate will be made for days on which the Garage is not
used by Tenant or its designees. In case of any violation of these
rules, Landlord may also refuse to permit the violator to park, and
may remove the vehicle owned or driven by the violator from the
Property without liability whatsoever, at such violator’s
risk and expense. Landlord reserves the right to close all or a
portion of the parking areas or facilities in order to make repairs
or perform maintenance services, or to alter, modify, re-stripe or
renovate the same, or if required by casualty, strike,
condemnation, act of God, Law or governmental requirement or
guideline, termination or modification of any lease or other
agreement by which Landlord obtained parking rights, or any other
reason beyond Landlord’s reasonable control. In the event
access is denied for any reason, any monthly parking charges shall
be abated to the extent access is denied, as Tenant’s sole
recourse.
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(iii) Hours
shall be reasonably established by Landlord or its parking operator
from time to time; cars must be parked entirely within the stall
lines, and only small or other qualifying cars may be parked in
areas reserved for such cars; all directional signs, arrows and
speed limits must be observed; spaces reserved for disabled persons
must be used only by vehicles properly designated; washing, waxing,
cleaning or servicing of any vehicle is prohibited; every xxxxxx is
required to park and lock his own car, except to the extent that
Landlord adopts a valet parking system; parking is prohibited in
areas: (a) not striped or designated for parking, (b) aisles, (c)
where “no parking” signs are posted, (d) on ramps, and
(e) loading areas and other specially designated areas. Delivery
trucks and vehicles shall use only those areas designated
therefor.
(iv) Parking
stickers, key cards or any other devices or forms of identification
or entry shall remain the property of Landlord. Such devices must
be displayed as requested and may not be mutilated in any manner.
The serial number of the parking identification device may not be
obliterated. Devices are not transferable and any device in the
possession of an unauthorized holder will be void. Loss or theft of
parking identification, key cards or other such devices must be
reported to Landlord or any garage manager immediately. Any parking
devices reported lost or stolen which are found on any unauthorized
car will be confiscated and the illegal holder will be subject to
prosecution. Lost or stolen devices found by Tenant or its
employees must be reported to Landlord or the office of the garage
immediately.
(22) Responsibility
for Compliance. Tenant shall be responsible for ensuring
compliance with these Rules, as they may be amended, by
Tenant’s employees and as applicable, by Tenant’s
agents, invitees, contractors, subcontractors, and suppliers.
Tenant shall cooperate with any reasonable program or requests by
Landlord to monitor and enforce the Rules, including providing
vehicle numbers and taking appropriate action against such of the
foregoing parties who violate these provisions.
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RIDER TWO
GREEN ADDENDUM
(1) The term "Green
Standard" or words of similar import shall include the U.S.
EPA’s Energy Star® rating, the Green Building
Initiative’s Green Globes TM for Continual Improvement of
Existing Buildings (Green GlobesTM-CIEB), the U.S. Green Building
Council’s Leadership in Energy and Environmental Design
(LEED), and/or a current and similar organization with equally
rigorous environmentally and sustainable practices.
(2) Building Expenses
shall also include: (i) all costs of maintaining, managing,
reporting, commissioning, and recommissioning the Building or any
part thereof that was designed and/or upgraded to be sustainable
and conform with one or more Green Standard rating systems, and
(ii) all costs of applying, reporting and commissioning the
Building or any part thereof to seek certification under one or
more Green Standard rating systems, provided however, the cost of
such applying, reporting and commissioning of the Building or any
part thereof to seek certification shall be a cost capitalized and
thereafter amortized as an annual Expense under GAAP.
(3) Tenant shall not
use or occupy the Premises for any unlawful purpose or in any
manner that will constitute waste, nuisance or unreasonable
annoyance to Landlord or other tenants of the Building. Tenant
shall not use or operate the Premises in any manner that will cause
the Building or any part thereof not to conform with
Landlord’s sustainability practices or a Green Standard
certification of the Building.
(4) This building is or
may become in the future certified under a Green Standard or
operated pursuant to Landlord’s sustainable building
practices. Landlord’s sustainability practices address
whole-building operations and maintenance issues including chemical
use; indoor air quality; energy efficiency; water efficiency;
recycling programs; exterior maintenance programs; and systems
upgrades to meet green building energy, water, Indoor Air Quality,
and lighting performance standards. All construction and
maintenance methods and procedures, material purchases, and
disposal of waste must be in compliance with minimum standards and
specifications, in addition to all applicable laws.
(5) Tenant shall use
proven energy and carbon reduction measures, including energy
efficient bulbs in task lighting; use of lighting controls; closing
shades as needed to avoid over heating the space; turning off
lights and equipment at the end of the work day; purchasing ENERGY
STAR® qualified equipment, including but not limited to
lighting, office equipment, commercial and residential quality
kitchen equipment, vending and ice machines, and; purchasing
products certified by the U.S. EPA’s Water Sense®
program.
(6) Tenant covenants
and agrees, at its sole cost and expense: (a) to comply with all
present and future laws, orders and regulations of the Federal,
State, county, municipal or other governing authorities,
departments, commissions, agencies and boards regarding the
collection, sorting, separation, and recycling of garbage, trash,
rubbish and other refuse (collectively, “trash”); (b)
to comply with Landlord’s recycling policy as part of
Landlord’s sustainability practices where it may be more
stringent than applicable law; (c) to sort and separate its trash
and recycling into such categories as are provided by law or
Landlord’s sustainability practices; (d) that each separately
sorted category of trash and recycling shall be placed in separate
receptacles as directed by Landlord, and; (e) that Tenant shall pay
all costs, expenses, fines, penalties or damages that may be
imposed on Landlord or Tenant by reason of Tenant’s failure
to comply with the provisions of this Section. Where possible, the
Landlord shall provide a composting program and encourage the
Tenant to sort and separate its trash and recycling from compost
material.
(7) Landlord shall
provide and install all original bulbs and tubes for Building
standard lighting fixtures within the Premises and all replacement
tubes for such lighting, the cost of which shall be included in
Building Expenses; all other bulbs, tubes and lighting fixtures for
the Premises shall be provided and installed by Tenant at
Tenant’s cost and expense, and must comply with
Landlord’s sustainability practices, including any Green
Standard rating system, concerning the environmental compliance of
the Building or the Premises, as the same may change from time to
time. All maintenance and repairs made by Tenant must comply with
Landlord’s sustainability practices, including any Green
Standard rating system concerning the environmental compliance of
the Building or the Premises, as the same may change from time to
time.
(8) Any and all Tenant
Improvement Work and/or Alterations is strongly encouraged to be
performed in accordance with Landlord’s sustainability
practices, including any Green Standard or third-party rating
system concerning the environmental compliance of the Building or
the Premises, as the same may change from time to time. Tenant is
further encouraged to engage a qualified third party LEED or Green
Standard professional or similarly qualified professional during
the design phase through implementation of any Tenant Improvement
Work and/or Alterations to review all plans, material procurement,
demolition, construction and waste management procedures to ensure
they are in full conformance with Landlord’s sustainability
practices, as aforesaid. Any and all waste and debris from Tenant
Improvement Work and/or Alterations must meet the minimum
requirements set forth by the Green Standard.
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(9) Landlord does not
permit space heaters or other energy-intensive equipment
unnecessary to conduct Tenant’s business without written
approval by Landlord. Any space conditioning equipment that is
placed in the Premises for the purpose of increasing comfort to
tenants shall be operated on sensors or timers that limit operation
of equipment to hours of occupancy in the areas immediately
adjacent to the occupying personnel.
(10) Tenant
acknowledges that it is Landlord’s intention that the
Property be operated in a manner which is consistent with
Landlord’s sustainability practices. Tenant is required to
comply with these practices within its Premises.
(11)
Tenant shall
dispose of, in an environmentally sustainable manner, any
equipment, furnishings, or materials no longer needed by Tenant and
shall recycle or re-use such items in accordance with
Landlord’s sustainability practices. Tenant is responsible
for reporting this activity to Landlord in a format determined by
Landlord.
(12) Landlord
currently provides janitorial service only after 5:30 p.m. five
days per week (excluding legal holidays). Landlord reserves the
right to conduct routine cleaning during Normal Business Hours in
accordance with Landlord’s sustainability practices and will
be done in such a way as to minimize disruption.
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