HomeMy WebLinkAbout09-083 - International Gateway East (Sabey) - Records Center LeaseSABEY
Data Center Propertles
VIA EMAIL
March 26, 2021
City of Tukwila
6300 Southcenter lvd.
Tukwila, WA 98188
Attention: Rachel Bianchi
Reference 09-083
Re: Holdover of Warehouse Lease Agreement Dated May 4, 2009 (as amended, the
"Agreement") between Ilnternational Gateway East LLC ("Landlord") and City of Tukwila
("Tenant")
Dear Rachel:
The Term for the Agreement referenced above expires on May 31, 2021.
This letter serves as Landlord's consent for Tenant to continue to occupy the Premises provided
in the Agreement until June 30, 2021 ("Final Vacancy Date"). The parties shall treat this period
of continued occupancy as a "Holdover" under Section 3.4 of the Agreement. However, during
this Holdover period, Landlord agrees that Base Rent for the month of June, 2021 shall be the
same rate as the month of May, 2021.
This letter is issued by Landlord expressly subject to the following:
• This letter does not amend, alter, or replace any terms under the Agreement.
• This letter does not constitute any consent to allow Tenant to holdover after or past the
Final Vacancy Date.
Please feel free to give me a call at 206-281-8700 if you have any questions.
Sincerely,
1NTERNATlONAL GATEWAY EAST LLC,
By Sabey Corporation, Manager
Mikel Hansen
Chief Operating Officer
cc: Travis Anderson, Senior Corporate Counsel
Cleo Monroe, Accounts Receivable Manager
12201 TukwRa Intl Blvd - 4th Floor, Seattle, WA 98168-5121
T 206.281,8700 r 206.282.9951 W sabeydatacenlers.com
09-083 (c)
Council Approval 7/20/15
THIRD AMENDMENT TO THE WAREHOUSE LEASE AGREEMENT
This Third Amendment to the Warehouse Lease Agreement ("Amendment") is entered
into by and between International Gateway East LLC ("Landlord"), as Landlord, and City of
Tukwila, ("Tenant") as Tenant, under that certain Warehouse Lease Agreement ("Lease"), dated
May 4, 2009, as amended by that certain First Amendment to the Warehouse Lease Agreement
dated December 12, 2011, as amended by that certain Second Amendment to the Warehouse
Lease Agreement dated April 25th, 2014, between the parties hereto.
RECITALS
A. Landlord and Tenant desire to extend the Term of the Lease and revise Tenant's
Option to extend the Term of the Lease in accordance with the terms herein.
B. Except as may be expressly provided otherwise in this Amendment, capitalized
terms in this Amendment shall have the meaning given such terms in the Lease.
NOW, THEREFORE, in consideration of the mutual promises contained herein,
Landlord and Tenant agree as follows:
1. Amendments.
1.1 Section 1.8 Expiration Date is amended and restated in its entirety as follows:
"Expiration Date" means May 31, 2016, which is the date that is seven (7) years after the
Commencement Date, unless sooner terminated or extended in accordance with this Lease.
1.2 Section 1.9 Term is amended and restated in its entirety as follows:
"Term" means a period of seven (7) years, commencing on the Commencement Date and
terminating on the Expiration Date, unless sooner terminated or extended in accordance with this
Lease.
1.3 Section 1.10 Base Rent is amended and restated in its entirety as follows:
Base Rent for Suite 110 shall be payable by the following schedule:
Term
Base Rent/Month
06/01/09
— 05/31/10
$4,600.28
06/01/10
— 05/31/11
$4,988.25
06/01/11
— 05/31/12
$5,265.38
06/01/12
— 05/31/14
$5,542.50
1
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06/01/14
— 05/31/15
$5,708.78
06/01/15
— 05/31/16
$5,880.04
Base Rent shall be payable as provided in Section 4.
1.4 Section 3.6 Extension Option is amended and restated in its entirety as follows:
i) Upon expiration of the seven (7) years of the initial Term, the Term of the
Lease will automatically extend for successive twelve (12) month periods
(each, an "Option Term") on the same terms and conditions as contained in
this Lease as are provided for in the initial Term, except as provided below in
Section 3.7.
ii) Either party may prevent the Term from extending to additional Option
Terms by providing the other party with written notice of intent not to renew
("Non Renewal Notice") more than ninety (90) days prior to the expiration of
the initial Term, or the current Option Term, as the case may be.
iii) The first Option Term commences upon the date of expiration of the initial
Term.
iv) Neither party has the right to revoke its Non -Renewal Notice once the notice
is delivered to the other party.
v) For the purposes of this Lease, "Term" means the initial Term and any Option
Term.
1.5 Section 3.7 Base Rent During Option Term is amended and restated in its
entirety as follows:
i) The Base Rent in respect to each Option Term increases two percent (2%)
from the Base Rent payable under the immediately prior period under this
Lease.
ii) The adjusted Base Rent commences on and is payable on the first day of each
Option Term.
2. Entire Amendment. This Amendment sets forth the entire agreement of the parties with
respect to the subject matter set forth herein and may not be modified other than by an agreement
in writing signed by the parties hereto or their respective successors and interests.
3. Acknowledgement. The parties hereto each acknowledge that as expressly modified by
this Amendment, all the terms and conditions of the Lease remain unchanged and are in full force
and effect and enforceable in accordance with their terms. In the event of a conflict between the
Lease and this Amendment, the terms and provisions of this Amendment shall control.
4. Execution. This Amendment may be executed in several counterparts and all so executed
2
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shall constitute one Amendment, binding on all the parties hereto even though all the parties are
not signatories to the original or the same counterpart. Delivery of a facsimile or other copy of
this Amendment has the same effect as delivery of an original.
5. Lender's Consent. The effectiveness of this Amendment is conditioned upon Landlord
receiving the consent of its lender.
DATED this
TENANT:
CITY OF TUKWILA
By:
Its:
ay of , 2015.
LANDLORD:
INTERNATIONAL GATEWAY EAST LLC,
by Sabeyj'oration, Manager
By: A•tit1U4, 4
Its: Senior VP, Finance
3
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STATE OF WASHINGTON )
) ss.
COUNTY OF KING
On this Sday of `) lq , 2015, before me, the undersigned, a Notary
Public in and for the State of Washington, ally commissioned and sworn as such personally
appeared '3M r,,‘ 40t. at/t011/4) , to me known to be the rnaj C%
of CITY OF TUKWILA, a mu'p:icipality that executed the within and foregoing instrument, and
acknowledged the said instrument to be the free and voluntary act and deed of said corporation
for the uses and purposes therein mentioned, and on oath stated that he/she was authorized to
execute said instrument.
WITNESS,fi
,d and official
01°
i
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s
yi �►S :(41% : it
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seal the day and year in this certificate first above written.
OF -4d116=.
aFia
NOTARY PUBLIC in and fo the Stat- of
.,;1
Washington, residing at • t1,'
My commission expires: _•
Printed Name:
STATE OF WASHINGTON )
) ss.
COUNTY OF KING )
On this 9 ' day of ,jo.ty , 2015, before me, the undersigned, a Notary
Public in and for the State of Washington, duly commissioned and sworn as such, personally
appeared Patricia A. Sewell, to me known to be the Senior VP, Finance, of Sabey Corporation,
Manager of INTERNATIONAL GATEWAY EAST LLC, the corporation that executed the
within and foregoing instrument, and acknowledged the said instrument to be the free and
voluntary act and deed of said corporation for the uses and purposes therein mentioned, and on
oath stated that she was authorized to execute said instrument.
WITNESS my hand and official seal the day and year in this certificate first above written.
?o-No7ARyA� Nm
V N
PUE#L\G r'
G:\Legal\Lease7gto9/documents\IGE Bldg
6/17/15 4:23PM �///////
Printed Name:
NOTARY PUBLIC in and for the State of
Washington, residing atm VDh2 Vvft
My commission expires: CP (19 f1
4
1\Tukwila Amend 3 061715.doc
09-083(b)
Council Approval 4/21/14
SECOND AMENDMENT TO THE WAREHOUSE LEASE AGREEMENT
This Second Amendment to the Warehouse Lease Agreement ("Amendment") is entered
into by and between International Gateway East LLC ("Landlord"), as Landlord, and City of
Tukwila, ("Tenant") as Tenant, under that certain Warehouse Lease Agreement ("Lease"), dated
May 4, 2009, as amended by that certain First Amendment to the Warehouse Lease Agreement,
dated December 12, 2011, between the parties hereto.
RECITALS
A. Landlord and Tenant desire to extend the Term of the Lease and add an option to
renew in accordance with the terms herein.
B. Except as may be expressly provided otherwise in this Amendment, capitalized
terms in this Amendment shall have the meaning given such terms in the Lease.
NOW, THEREFORE, in consideration of the mutual promises contained herein,
Landlord and Tenant agree as follows:
1. Amendments.
1.1 Section 1.8 Expiration Date is amended and restated in its entirety as follows:
"Expiration Date" means May 31, 2015, which is the date that is six (6) years after the
Commencement Date, unless sooner terminated or extended in accordance with this Lease.
1.2 Section 1.9 Term is amended and restated in its entirety as follows:
"Term" means a period of six (6) years, commencing on the Commencement Date and
terminating on the Expiration Date, unless sooner terminated or extended in accordance with this
Lease.
1.3 Section 1.10 Base Rent is amended and restated in its entirety as follows:
Base Rent for Suite 110 shall be payable by the following schedule:
Term
Base Rent/Month
06/01/09
- 05/31/10
$4,600.28
06/01/10
- 05/31/11
$4,988.25
06/01/11
- 05/31/12
$5,265.38
06/01/12
- 05/31/14
$5,542.50
06/01/14
- 05/31/15
$5,708.78
1
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61-O / a 01/6/A -S
Base Rent shall be payable as provided in Section 4.
1.4 Section 3.6 Extension Option is added to the Lease as follows:
Provided that Tenant is in compliance with all the terms and conditions of this Lease and has not
been in default of this Lease beyond any applicable cure period during the last twelve (12) months
of the Lease Term, Tenant shall have the option ("Option") to extend the Term of this Lease for one
(1) additional period of one (1) year (the "Option Term") on the same terms and conditions of this
Lease as are provided for in the initial Term, except as provided below in this Section 3.6 or in
Section 3.7 and without any free rent periods or Tenant Improvement allowances. The Option
Term shall commence upon the date of expiration of the initial Term of this Lease. To exercise its
Option, Tenant must give written notice to Landlord that Tenant is exercising its Option at least six
(6) months before the date of expiration of the initial Term. Once such notice is delivered to
Landlord, such notice shall be irrevocable by Tenant. If, in Landlord's reasonable discretion,
Landlord determines that the creditworthiness of Tenant is materially less than the creditworthiness
of Tenant as of the Lease's execution date, Landlord may nullify Tenant's exercise of its Option by
written notice to Tenant. Tenant acknowledges and agrees that notwithstanding anything to the
contrary in this Lease, the right to exercise the Option shall not extend to any assignee or subtenant
of Tenant, or to any space assigned or subleased by Tenant, and any attempt to exercise the Option
by any such assignee or subtenant, or by Tenant in connection with such assigned or subleased
space, shall be deemed null and void. Tenant further acknowledges and agrees that the amount of
the Security Deposit payable by Tenant for the Option Term may be increased to an amount equal
to the first monthly installment of Base Rent payable by Tenant during the Option Term.
1.5 Section 3.7 Base Rent During Option Term is added to the Lease as follows:
In the event that Tenant elects to exercise its Option to extend the Term of this Lease in accordance
with the terms of Section 3.7, the Base Rent for the Option Term shall be equal to the then -market
rent for similarly improved space in comparable buildings for comparable use in the Seattle region
as determined by Landlord; provided, however, that in no event shall the Base Rent during the
Option Term be less than the Base Rent for the last year of the initial Lease Term. The adjusted
Base Rent shall commence on and be payable on the first day of the Option Term and shall
continue thereafter throughout the Option Term. The market rate shall be determined on a triple net
basis by analyzing comparable lease transactions and lease renewals in the Seattle region. In
analyzing comparable transactions, all reasonable factors affecting rent shall be taken into
consideration, including, but not limited to, the building age, size, style and condition and the date
of the comparable lease.
If Landlord and Tenant cannot agree on a market rate for the Option Term prior to ninety
(90) days before Lease termination, then both parties agree to use the appraisal process, outlined as
follows: Each party will hire an MAI appraiser. Each appraiser must have a minimum of five (5)
years appraisal experience in the Seattle area. Each appraiser shall complete his/her appraisal
2
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within thirty (30) days. If the appraisers' opinion of the market rate differs by less than ten percent
(10%) of the amount of the higher appraisal; then the market rate shall be the average of the two
appraisals. If the appraisers' opinion of market rate differs by more than ten percent (10%) of the
higher appraisal then a third MAI appraiser satisfying the same qualifications shall be mutually
hired and paid for by both parties. The third appraiser will evaluate the market using the same
parameters outlined in the preceding paragraph. The market rate estimate of the third appraiser
shall be averaged with the market rate estimate of the appraiser closest to it. The Base Rent for the
Option Term shall be the higher of the resultant average rent utilizing this process or the Base Rent
being paid at the time of the renewal.
2. Entire Amendment. This Amendment sets forth the entire agreement of the parties with
respect to the subject matter set forth herein and may not be modified other than by an agreement
in writing signed by the parties hereto or their respective successors and interests.
3. Acknowledgement. The parties hereto each acknowledge that as expressly modified by
this Amendment, all the terms and conditions of the Lease remain unchanged and are in full force
and effect and enforceable in accordance with their terms. In the event of a conflict between the
Lease and this Amendment, the terms and provisions of this Amendment shall control.
4. Execution. This Amendment may be executed in several counterparts and all so executed
shall constitute one Amendment, binding on all the parties hereto even though all the parties are
not signatories to the original or the same counterpart. Delivery of a facsimile or other copy of
this Amendment has the same effect as delivery of an original.
5. Lender's Consent. The effectiveness of this Amendment is conditioned upon Landlord
receiving the consent of its lender
The rest of this page is intentionally left blank; signatures to follow;
3
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TENANT:
CITY OF T KWILA
By:
Its:
`P A
DATED this day of -p , 20114.,
LANDLORD:
INTERNATIONAL GATEWAY EAST LLC,
by Sabey oration, Manager
By:
Its: Treasurer & Secretary
4
G:\Legal\Lease Materials\Lease Documents\International Gateway East\IGE Bldg 1\Tukwila Amend 2 100813.doc
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STATE OF WASHINGTON)
COUNTY OF KING )
On this 3 day of 9- 43 r, � , 201V, before me, the undersigned, a Notary
Public in and for the State of Washington, duly commissioned and sworn as such, personally
appeared t • d �� , to me known to be the Mor.Dof
of CITY OF TUKWILA, a m `nncipality that executed the within and foregoing instrument, and
acknowledged the said instrument to be the free and voluntary act and deed of said corporation
for the uses and purposes therein mentioned, and on oath stated that he/she was authorized to
execute said instrument.
) ss.
WITNESS my hand and official seal the day and year in this certificate first above written.
4:0244"4"40L.4446.— lig
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STATE OF WASHINGTON)
) ss.
COUNTY OF KING )
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Printed Name: �7, kr,cry
0' FLa he: -Ly
ft
the PUBLIC in and he Statee o
Washington, residing at Ec�7,'u lt, -i'
My commission expires: --i,.„-q'14
W
On this 13 '% day of Ac,Yc,h ,.20-1-3., before me, the undersigned, a Notary
Public in and for the State of Washington, duly commissioned and sworn as such, personally
appeared Patricia A. Sewell, to me known to be the Treasurer & Secretary of Sabey Corporation,
Manager of INTERNATIONAL GATEWAY EAST LLC, the corporation that executed the
within and foregoing instrument, and acknowledged the said instrument to be the free and
voluntary act and deed of said corporation for the uses and purposes therein mentioned, and on
oath stated that she was authorized to execute said instrument.
WITNESS my hand and official seal the day and year in this certificate first above written.
p 4:?o. ma.INS er,
.N�..Z:0 ‘40TAPY m104%44111
Pt./Boo :'
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G:\Legal\Lease Materials\Lease Documents\International
10/8/13 2:50PM
Printed Name :Sk W\ CSC is n--UP11npS*ex
NOTARY PUBLIC in and for the State of
Washington, residing at R-txrto J w,A
My commission expires: ,.p'
5
Gateway East\IGE Bldg 1\Tukwila Amend 2 100813.doc
0 i)36A-)
FIRST AMENDMENT TO THE WAREHOUSE LEASE AGREEMENT
This First Amendment to the Warehouse Lease Agreement ("Amendment") is entered
into by and between International Gateway East LLC ("Landlord"), as Landlord, and City of
Tukwila, ("Tenant") as Tenant, under that certain Warehouse Lease Agreement ("Lease"), dated
May 4, 2009, between the parties hereto.
RECITALS
A. Landlord and Tenant desire to amend the Lease to decrease Tenant's Share of the
Building from 6.75% to 6.48% and add Landlord's obligation to construct a tenant restroom
facility in accordance with the terms herein.
B. All of the modifications in this Amendment shall be effective as of January 1, 2012.
C. Landlord and Tenant agree that Section 1.10 Base Rent shall remain unchanged by
this Amendment.
D. Except as may be expressly provided otherwise in this Amendment, capitalized
terms in this Amendment shall have the meaning given such terms in the Lease.
NOW, THEREFORE, in consideration of the mutual promises contained herein,
Landlord and Tenant agree as follows:
1. Amendments.
1.1 Section 1.3 Premises is replaced and restated in its entirety as follows:
The "Premises" means the space consisting of approximately 6,392 rentable square feet
located on the first (1st) floor of the Building in Suite 110 and depicted on the floor plan attached to
this Lease as Exhibit B, subject to recalculation in accordance with Section 2. The Premises shall
include the Tenant Improvements, if any, described in Exhibit C.
1.2 Section 1.5 Tenant's Share is replaced and restated in its entirety as follows:
"Tenant's Share" means "Tenant's Share of the Property" or "Tenant's Share of the
Building." "Tenant's Share of the Building" means Six and Forty -Eight one hundredths percent
(6.48%), calculated by dividing the rentable area of the Premises by the rentable area of the
Building (approximately 98,570 rentable square feet). In the event the rentable area of the
Premises, Building or Property is altered or recalculated in accordance with Section 2, Landlord
shall adjust Tenant's Share to properly reflect such event.
1
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/5/-f a , f6/A/4Ls
1.3 Exhibit C Landlord's Work and Tenant's Work, Section I Improvements
Provided by Landlord is amended by adding the following language to the end of such Section:
19. Landlord shall, at its sole cost and expense, construct a Tenant restroom per
the construction drawings in Exhibit C-2, attached hereto. Landlord shall use all
reasonable efforts to complete such work within sixty (60) days of execution of this
Amendment.
2. Entire Amendment. This Amendment sets forth the entire agreement of the parties with
respect to the subject matter set forth herein and may not be modified other than by an agreement
in writing signed by the parties hereto or their respective successors and interests.
3. Acknowledgement. The parties hereto each acknowledge that as expressly modified by
this Amendment, all the terms and conditions of the Lease remain unchanged and are in full force
and effect and enforceable in accordance with their terms. In the event of a conflict between the
Lease and this Amendment, the terms and provisions of this Amendment shall control.
4. Execution. This Amendment may be executed in several counterparts and all so executed
shall constitute one Amendment, binding on all the parties hereto even though all the parties are
not signatories to the original or the same counterpart. Delivery of a facsimile or other copy of
this Amendment has the same effect as delivery of an original.
5. Exhibit. Exhibit B attached hereto is incorporated herein by this reference, and
supersedes and replaces the prior Exhibit B to the Lease. Exhibit C-2 attached hereto is
incorporated herein by this reference.
6. Lender's Consent. The effectiveness of this Amendment is conditioned upon Landlord
receiving the consent of its lender
The rest of this page is intentionally left blank; signatures are on the following page.
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11/21/11 9:22AM
DATED this 11 s'j" day of be c %4t b.e. , 2011.
TENANT:
CITY OF TUKWILA
LANDLORD:
INTERNATIONAL GATEWAY EAST LLC,
by Sabey Corporation, Manager
By: A.tta/ O
Its: Treasurer & Secreta
3
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11/21/11 9:22AM
STATE OF wci9,4, pow )
0 ) ss.
COUNTY OF+^ J
On this )07 day of l , 2011, before me, the undersigned, a Notary
Public in and for the State of VJ►te , duly commissioned and sworn as such, personally
appeared 1i m tfa 9 alma' , to me known to be the tact v r
of CITY OF TUKWILA a municipality that executed the within and foregoing ii trument, and
acknowledged the said instrument to be the free and voluntary act and deed of said corporation
for the uses and purposes therein mentioned, and on oath stated that he/she was authorized to
execute said instrument.
WITNESS my hactAtQficial seal
t)SSS A? ith
M%ssoN,,,,�
i 01
°epic �=
'/ O '14;;9-12 .rr�
7SHING,�
STATE OF WASHINGTON)
) ss.
COUNTY OF KING )
the day and year in this certificate first above written.
Printed Name: Me -list,. R. time
NOTARY PUBLIC in and for the State,of
, residing at-Mk-AA-if-IC--
My
t"T wf-IC -
My commission expires: 1(14/
On this day of , 2011, before me, the undersigned, a Notary
Public in and for the State of Washington, duly commissioned and sworn as such, personally
appeared Patricia A. Sewell, to me known to be the Treasurer & Secretary of Sabey Corporation,
Manager of INTERNATIONAL GATEWAY EAST LLC, the corporation that executed the
within and foregoing instrument, and acknowledged the said instrument to be the free and
voluntary act and deed of said corporation for the uses and purposes therein mentioned, and on
oath stated that she was authorized to execute said instrument.
WITNESS my hand and official seal the day and year in this certificate first above written.
Printed Name:
NOTARY PUBLIC in and for the State of
Washington, residing at
My commission expires:
4
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11/21/11 9:22AM
EXHIBIT B
TO THE LEASE AGREEMENT
FLOOR PLAN OF PREMISES
EAST COMMON:
1,606 SF
SUITE 110
CITY OF TUKWILA
6,076 .SF
+209 E. COMMON (13%)
6,285 USF
6,392 RSF
BUILDING COMMON:
1,645 SF
CITY OF-UKQUILA.
NET USABLE:
96,925 SF
EXHI3IT
5
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11/21/11 9:22AM
EXHIBIT C-2
TO THE LEASE AGREEMENT
CONSTRUCTION DRAWINGS FOR RESTROOM BUILDOUT
[ATTACHED]
6
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11/21/11 9:22AM
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09-083
Council Approval 4/6/09
WAREHOUSE LEASE AGREEMENT
BY AND BETWEEN
International Gateway East LLC,
a Washington limited liability company
Landlord
and
City of Tukwila,
a MUNICIPALITY
Tenant
1 04 orist;w2n
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TABLE OF CONTENTS
Page
1. FUNDAMENTAL LEASE PROVISIONS; DEFINITIONS; EXHIBITS 1
11. Broker. 1
1.2. Building. 1
1.3. Premises 1
1.4. Property. 1
1.5. Tenant's Share. 1
1.6. Lease Year. 1
1.7. Commencement Date. 1
1.8. Expiration Date 1
1.9. Term 1
1.10. Base Rent. 2
1.10.1. Landlord's Equity in Exchange for Base Rent. 2
1.10.2. Material Impairment or Devaluation of Equity. 2
1.11. Early Occupancy. 2
1.12. Additional Rent. 2
1.13. Base Year 2
1.14. Security Deposit . 2
1.15. Parking. 2
1.16. Landlord's Payment Address 2
1.17. Notice Addresses. 2
1.18. Permitted Uses 3
1.19. Landlord's Work. 3
1.20. Tenant's Work 3
1.21. Guarantor. 3
1.22. Rent. 3
1.23. Exhibits. 3
2. PREMISES. 3
2.1. Acceptance of Premises. 3
2.2. Tenant Allowance. 3
2.3. Tenant's Right of First Refusal 4
2.4. Relocation or Termination. 4
3. LEASE TERM. 4
3.1. Duration of Lease Term. 4
3.2. Extension Option. 4
3.3. Base Rent During Option Term. 4
3.4. Tenant Termination Right. 4
3.5. Confirmation of Commencement Date 4
3.6. Surrender of Premises. 4
3.7. Holding Over With Consent. 4
3.8. Holding Over Without Consent. 4
4. RENT. 5
4.1. Payment. 5
4.1.1. Wire Payments. 5
4.2. Interest on Late Payments; Service Fee. 5
4.3. Address for Payments 5
5. SECURITY DEPOSIT. 5
6. USES; COMPLIANCE WITH LAWS. 6
6.1 Permitted Uses 6
6.2. Duties and Prohibited Conduct. 6
6.3. Environmental, Health And Safety Laws. 6
Office Lease Agreement-NNN
G:\Legal\WP\DOC\IG East\IGEAST\City of Tukwila\City of Tukwila Lease -LL 042809 - CLEAN.doc
Rev. 4/30/09 8:02 AM 1
7. SERVICES AND UTILITIES; REPAIRS AND MAINTENANCE 7
7.1. Services and Utilities; Landlord's Obligations. 7
7.1.1. Additional Services Or Utilities. 7
7.2. Services and Utilities; Tenant's Obligations. 7
7.3. Interruption. 8
7.4. Landlord's Repair and Maintenance Obligations. 8
7.5. Tenant's Repair and Maintenance Obligations. 8
7.6. Additional Security. 9
7.7. Tenant's Obligations. 9
8. ADDITIONAL RENT: OPERATING COSTS AND REAL ESTATE
TAXES. 9
8.1. Definitions. 9
8.1.1. Taxes. 9
8.1.2. Operating Costs 9
8.1.3. Tenant's Share. 10
8.2. Payment of Additional Rent for Estimated Operating Costs and
Taxes 11
8.3. Actual Operating Costs and Taxes 11
8.4. Determinations. 11
8.5. Tenant's Personal Property Taxes. 11
8.6. Tenant's Utility Charges. 11
9. IMPROVEMENTS AND ALTERATIONS BY TENANT 12
10. ACCESS. 12
11. DAMAGE OR DESTRUCTION. 12
11.1 Damage and Repair. 12
11.2. Destruction During Last Year of Term 13
11.3. Business Interruption 13
11.4. Tenant Improvements 13
11.5. Express Agreement. 13
12. WAIVER OF SUBROGATION. 13
13. INDEMNIFICATION. 14
14. INSURANCE. 15
14.1. Worker's Compensation 15
14.2. Liability Insurance 15
14.3. Property Insurance 15
14.4. Insurance Policy Requirements 15
14.5. Failure to Maintain Insurance. 16
14.6. Increased Insurance Costs. 16
14.7. Self Insurance 16
15. ASSIGNMENT AND SUBLETTING 16
15.1. Assignment or Sublease. 16
15.2. Documentation and Expenses. 17
15.3. Transferee Obligations. 17
16. SIGNS. 18
17. LIENS. 18
18. BANKRUPTCY. 18
18.1. Assumption of Lease. 18
18.1.1. Definition of Adequate Assurances 19
18.2. Assignment of Lease. 19
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18.3. Adequate Protection. 19
19. DEFAULT. 19
19.1. Cumulative Remedies. 19
19.2. Tenant's Default; Right to Cure. 19
19.3. Landlord's Rights And Remedies 20
19.3.1. Termination of Lease. 20
19.3.2. Re-entry of the Premises 20
19.3.3. Termination After Reentry. 20
19.4. Landlord's Damages. 20
19.4.1. Delinquent Rent. 20
19.4.2. Rent After Termination Until Judgment. 20
19.4.3. Rent After Judgment 20
19.4.4. Leasing Concessions 21
19.4.5. Other Compensation. 21
19.4.6. Additional or Alternative Damages 21
19.4.7. Calculation of Damages 21
19.5. Tenant's Property. 21
19.6. No Waiver 21
19.7. Waiver of Notice. 22
19.8. Waiver of Redemption Rights 22
19.9. Default by Landlord. 22
19.10. Cross Default. 22
20. SUBORDINATION AND ATTORNMENT. 22
21. REMOVAL OF PROPERTY. 23
22. CONDEMNATION. 23
22.1. Entire Taking. 23
22.2. Constructive Taking of Entire Premises. 23
22.3. Partial Taking. 24
22.4. Awards and Damages. 24
23. NOTICES. 24
24. COSTS AND ATTORNEYS' FEES. 24
25. LANDLORD'S LIABILITY. 24
26. LANDLORD'S CONSENT. 25
27. ESTOPPEL CERTIFICATES. 25
28. RIGHT TO PERFORM. 25
29. PARKING. 25
30. AUTHORITY.26
31. GENERAL. 26
31.1. Headings. 26
31.2. Heirs and Assigns. 26
31.3. No Brokers 26
31.4. Tenant's Financial Statement. 26
31.5. Entire Agreement. 27
31.6. Severability. 27
31.7. Force Majeure 27
31.8. Right to Change Public Spaces. 27
31.9. Governing Law 27
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31.10. Building Directory 27
31.11. Building Name. 28
31.12. Quiet Enjoyment 28
31.13. Survival 28
31.14. Lender's Consent. 28
31.15. Time. 28
31.16. Interpretation. 28
31.17. Execution. 28
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WAREHOUSE LEASE AGREEMENT
THIS WAREHOUSE LEASE AGREEMENT ("Lease") is made this 4 -
day of ,/u a -id , 2009 ("Effective Date"), between International Gateway East LLC,
a Washington limited liability company ("Landlord"), and City of Tukwila, a
lawn i ea I, 'h , ("Tenant"). The parties agree as follows:
1. FUNDAMENTAL LEASE PROVISIONS; DEFINITIONS; EXHIBITS.
Capitalized terms used in this Lease shall have the meanings provided in this
Section 1, unless otherwise specifically modified by provisions of this Lease.
1.1. Broker. Intentionally Deleted.
1.2. Building. "Building" means the structure commonly known as
Intergate.East Building 1 ("IGE 1"). The Building is situated on a portion of the real
property legally described in Exhibit A and has a postal address of 3411 South izoth Place,
Seattle, Washington 98168. Landlord may alter the boundary lines of the Land (defined
below) on which the Building is located pursuant to a boundary line or lot line adjustment
and without Tenant's consent so long as the Building remains within the Landlord's
property.
1.3. Premises. The "Premises" means the space consisting of approximately
6,651 rentable square feet located on the first (1st) floor of the Building in Suite 110 and
depicted on the floor plan attached to this Lease as Exhibit B, subject to recalculation in
accordance with Section 2. The Premises shall include the Tenant Improvements, if any,
described in Exhibit C.
1.4. Property. The Premises, Building, other improvements on the Land, and
the Land, are sometimes collectively referred to in this Lease as the "Property".
1.5. Tenant's Share. "Tenant's Share" means "Tenant's Share of the Property"
or "Tenant's Share of the Building". "Tenant's Share of the Building" means six and
seventy-five one hundredths percent (6.75%), calculated by dividing the rentable area of the
Premises by the rentable area of the Building (approximately 98,600 rentable square feet).
In the event the rentable area of the Premises, Building or Property is altered or recalculated
in accordance with Section 2, Landlord shall adjust Tenant's Share to properly reflect such
event. Landlord's adjustment of such Tenant's Share shall be final.
1.6. Lease Year. "Lease Year" means each twelve-month period commencing
January 1 and ending December 31.
1.7. Commencement Date. Subject to Section 3.1, "Commencement Date"
means June 1, 2009. In the event that the Lease Term commences on a day other than the
first day of a calendar month, then the Commencement Date as specified in the preceding
sentence shall be deemed to be the first day of the next calendar month, and the Tenant
shall be deemed to have been given early occupancy as of the date specified in the
preceding sentence, with all terms of this Lease, including Rent, and other amounts due to
Landlord, applicable to the period of early occupancy.
1.8. Expiration Date. "Expiration Date" means the date that is five (5) years
after the Commencement Date, unless sooner terminated or extended in accordance with
this Lease.
1.9. Term. "Term" means a period of five (5) years, commencing on the
Commencement Date and terminating on the Expiration Date, unless sooner terminated or
extended in accordance with this Lease.
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1.10. Base Rent. "Base Rent" from the Commencement Date through the
Twelfth (12th) month means Four Thousand Six Hundred and 28/100 Dollars ($4,600.28)
per month.
"Base Rent" from the thirteenth (13th) month through the twenty-fourth (24th)
month means Four Thousand Nine Hundred Eighty-eight and 25/100 Dollars ($4,988.25)
per month.
"Base Rent" from the twenty-fifth (25th) month through the thirty-sixth (36th)
month means Five Thousand Two Hundred Sixty-five and 38 /100 Dollars ($5,265.38 ) per
month.
"Base Rent" from the thrity-seventh (37th) month through the Expiration Date
means Five Thousand Five Hundred Forty-two and 50 /100 Dollars ($5,542.50) per month.
Base Rent shall be payable as provided in Section 4.
1.11. Early Occupancy. Tenant will be allowed to occupy any portion of the
Premises Tenant determines is ready for occupancy before the Commencement Date. Early
Occupancy means any use of the space not directly related to the installation of equipment
or constructing the Premises. During Early Occupancy, "Base Rent" will be calculated by
multiplying the actual occupied rentable square feet by eight and 30/100 Dollars ($8.30) per
rentable square foot on an annualized basis. Tenant will be responsible for all "Additional
Rent" as described in Section 8 on the portion of the space that they occupy early.
1.12. Additional Rent. "Additional Rent" means the amounts described in
Sections 7 and 8, and all other amounts which are payable by Tenant under this Lease,
except Base Rent.
1.13. Base Year. Intentionally Deleted.
1.14. Security Deposit . "Security Deposit" will be equivalent to last months rent
in the amount of Five Thousand Five Hundred Forty-two and 50/100 Dollars ($5,542.50).
1.15. Parking. Subject to Section 29.
1.16. Landlord's Payment Address. "Landlord's Payment Address" means:
International Gateway East LLC, P.O. Box 34108, Seattle, Washington 98124-1108.
1.17. Notice Addresses.
If to Landlord: International Gateway East LLC c/o Sabey Corporation
12201 Tukwila International Blvd.
Fourth Floor
Seattle, WA 98168-5121
Attn: Sr. V.P. Real Estate
Phone No. 206-281-8700
Fax No. 206-282-9951
with a copy to:
If to Tenant:
Sabey Corporation
12201 Tukwila International Blvd.
Fourth Floor
Seattle, WA 98168-5121
Attn.: Director of Property Operations
Phone No. 206-281-8700
Fax No. 206-282-9951
City of Tukwila
6300 Southcenter Blvd.
Tukwila, WA 98188
Attn:
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Phone No.
Fax No.
1.18. Permitted Uses. "Permitted Uses" means Tenant's use of the Premises for
purposes of general record storage space or other uses incident thereto, subject to the terms
and conditions of this Lease.
1.19. Landlord's Work. "Landlord's Work" means the improvements, if any, to
be made by Landlord in accordance with Exhibit C.
1.20. Tenant's Work. "Tenant's Work" means the improvements, if any, to be
made by Tenant in accordance with Exhibit C and in compliance with Exhibit F, Tenant &
Tenant Contractor Construction Criteria, attached hereto.
1.21. Guarantor. Intentionally deleted.
1.22. Rent. "Rent" means Base Rent and Additional Rent.
1.23. Exhibits. The following exhibits or riders are attached to this Lease and are
incorporated into this Lease by this reference:
(a) Exhibit A - Legal Description
(b) Exhibit B - Floor Plan of Premises
(c) Exhibit C - Tenant Improvements
(d) Exhibit C-1- Tenant's Removable Property
(e) Exhibit D - Rules and Regulations
2. PREMISES. Landlord hereby leases to Tenant, and Tenant hereby leases from
Landlord, the Premises described in Section 1.3 together with the tenant improvements
described on Exhibit C ("Tenant Improvements") and together with rights of ingress and
egress over public and common areas in the Building and on the land legally described on
Exhibit A, including all easements appurtenant to the land ("Land"). Tenant's lease of the
Premises shall be subject to all of the terms and conditions of this Lease.
Landlord shall complete Landlord's Work in accordance with Exhibit C.
Notwithstanding anything to the contrary in this Lease, Tenant shall provide Landlord and
Landlord's contractor with such access to the Premises as may be required by Landlord and
Landlord's contractor to efficiently perform Landlord's Work. Tenant acknowledges and
agrees that Landlord shall have no obligation to improve the Premises except as may be
expressly set forth on Exhibit C.
Landlord may recalculate the "rentable square feet" of the Premises during the
Term. The recalculated rentable square feet shall be certified by Tenant's architect prior to
any change. Rentable square feet shall be calculated in accordance with BOMA standards,
the Building which may be changed upon the alteration of tenant spaces or Building
common areas. In the event the rentable area of the Building or Property is altered during
the Term of this Lease, Tenant's Share of the Property shall be adjusted to reflect such
change. BOMA standards shall mean the Building Owners and Managers Association
Method for Measuring Floor Area in Office Buildings, ANSI Z65.1-1996.
2.1. Acceptance of Premises. Landlord and Tenant hereby agree that
Landlord's Work as set forth in Section I of Exhibit C shall be constructed by Landlord's
contractor, Sabey Construction Inc. Tenant's acceptance of the Premises shall be deferred
until Landlord informs Tenant of the substantial completion of Landlord's Work or Tenant
occupies the Premises, whichever occurs first. Substantial completion shall mean the date
certified by Landlord's architect when construction is sufficiently complete, in accordance
with Section I of Exhibit C.
2.2. Tenant Allowance. Intentionally Deleted.
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2.3. Relocation or Termination. If Landlord determines that it is reasonably
necessary or desirable that Tenant vacate the Premises, or that the Premises be altered, in
connection with Landlord's expansion, leasing, reduction, removal, renovation or
construction of new or existing improvements, then Landlord may terminate this Lease,
provided Landlord leases Tenant other reasonably comparable premises, within the
Building, on the same terms and conditions as those contained in this Lease after
comparable build -out by Landlord. Landlord's ability to relocate Tenant shall be
conditioned on Landlord providing space (i) of approximately equivalent size to the
original Premises; (ii) at the same or lesser monthly rent; (iii) with comparable access; and
(iv) with comparable build -out and Tenant improvements at Landlord's expense. Landlord
shall also be required to pay for all moving costs and incidental costs, including but not
limited to the costs for transferring utility and telephone service, change of stationery and
change of address notices.
3. LEASE TERM.
3.1. Duration of Lease Term. Tenant's lease of the Premises shall commence
on the Commencement Date and terminate on the Expiration Date or such earlier or later
date as may be provided for under this Lease. Notwithstanding anything to the contrary in
Section 1.7, if Landlord is unable to deliver possession of the Premises to Tenant with
Landlord's Work constructed by Landlord's contractor substantially completed in
accordance with Exhibit C on the date specified in Section 1.7 and such delay (to the extent
of such delay) is due to no fault on the part of Tenant, then the Commencement Date shall
be the earlier of the date on which Tenant first occupies the Premises or the date that is ten
(10) days from the date of Landlord's written notice to Tenant of substantial completion of
Landlord's Work constructed by Landlord's contractor provided for in Section 2, above. In
no event shall Landlord be liable for damages caused by any such delay or failure to deliver
possession of the Premises.
3.2. Confirmation of Commencement Date. If the Commencement Date is not
the date indicated in Section 1.7, Landlord may confirm the Commencement Date to Tenant
in writing within a reasonable time after delivery of the Premises in accordance with this
Lease.
3.3. Surrender of Premises. Subject to Section 11, Tenant shall promptly and
peacefully surrender the Premises to Landlord upon the termination of the Lease Term in as
good a condition as when received by Tenant from Landlord and/or as thereafter improved,
if applicable, normal wear and tear excepted. Unless Landlord expressly provides
otherwise in writing to Tenant, upon the expiration or termination of this Lease, all
improvements and additions to the Premises except those items set forth on Exhibit C-1
shall be deemed property of Landlord and shall not be removed by Tenant from the
Premises. Tenant shall be solely responsible for, and shall repair, all damage to the
Property arising out of its surrender of the Premises. In addition to all other requirements
under this Lease, Tenant shall remove any Hazardous Substances, as such term is defined in
Section 6.3, on the Premises which were placed on the Premises by Tenant, its employees,
agents, contractors and/or invitees, prior to its surrender and vacation of the Premises.
3.4. Holding Over With Consent. If Tenant remains in possession of the
Premises after termination or expiration of the Lease Term with Landlord's written
permission, such tenancy shall be deemed a month-to-month tenancy which may be
terminated by either party upon twenty (20) days' notice. During such tenancy, Tenant
shall be bound by all of the terms, covenants and conditions in this Lease so far as
applicable, except that the Base Rent shall be increased to the greater of (i) the then -quoted
rates for similar space in the Building or (ii) one hundred fifty percent (150%) multiplied by
the sum of the monthly installment of Base Rent and Additional Rent payable for the last
month of the Lease Term.
3.5. Holding Over Without Consent. If Tenant remains in possession of the
Premises after the termination or expiration of the Lease Term without Landlord's prior
written consent, Tenant shall become a tenant at sufferance only, subject to all the
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provisions of this Lease so far as applicable, except that Base Rent shall be increased to an
amount equal to two hundred percent (200%) multiplied by the sum of the monthly
installments of Base Rent and Additional Rent payable by Tenant during the last month of
the Lease Term, prorated on a daily basis. Acceptance by Landlord of Rent after the
termination of the Lease Term shall not result in a renewal or extension of this Lease. The
provisions of Section 3.4 and this Section 3.5 are in addition to, and shall not act as a
waiver of or otherwise affect, Landlord's right of re-entry or any other rights of Landlord
under this Lease or as provided by law or in equity. If Tenant fails to surrender the
Premises upon the termination of the Lease Term, despite Landlord's demand to do so,
Tenant shall indemnify, defend and hold Landlord harmless from and against all loss and
liability, including, without limitation, any claim made by any succeeding tenant founded
on, or resulting from, such failure to surrender, including without limitation, any attorneys'
fees or costs associated therewith.
4. RENT.
4.1. Payment. Tenant shall pay Landlord the monthly installments of Base Rent
provided in Section 1.10 and Additional Rent provided in Section 1.12 in lawful money of
the United States, in advance, on the Commencement Date and thereafter on or before the
first day of each month throughout the Lease Term. Base Rent and Additional Rent shall
be paid by Tenant without notice or demand, deduction, abatement, or offset, except as
expressly provided herein. Base Rent and Additional Rent for any partial month at the
beginning or end of the Lease Term shall be prorated in proportion to the number of days in
such month.
4.1.1. Wire Payments. Any amounts payable to Landlord under this
Lease in excess of Ten Thousand and No/100 Dollars ($10,000.00) per occurrence shall be
made by wire transfer instructions to follow under separate letter.
4.2. Interest on Late Payments; Service Fee. If any Base Rent or Additional
Rent is not paid on the due date thereof: (i) such overdue amounts shall bear interest at a
rate equal to eighteen percent (18%) per annum; and (ii) Tenant shall pay Landlord a
service fee equal to five percent (5%) of such overdue amount. The parties hereby agree
that such service fee represents a fair and reasonable estimate of the costs Landlord will
incur by reason of late payment by Tenant, the exact amount of which would be difficult to
ascertain. Acceptance by Landlord of any partial amounts due under this Section 4 shall in
no event constitute a waiver of Tenant's default with respect to any overdue amount, nor
prevent Landlord from exercising any of its other rights and remedies granted under this
Lease or by law or in equity.
4.3. Address for Payments. Tenant shall pay all Rent to Landlord at Landlord's
Payment Address, or at such other place as may be designated by Landlord from time to
time by written notice to Tenant.
5. SECURITY DEPOSIT. As security for the full and faithful performance of every
covenant and condition of this Lease to be performed by Tenant, Tenant shall pay to
Landlord the Security Deposit specified in Section 1.14. If Tenant defaults with respect to
any covenant or condition of this Lease, including but not limited to, the payment of Base
Rent or Additional Rent or other amounts due under this Lease, Landlord may apply all or
any part of the Security Deposit to the payment of any sum in default or payment of any
other sum which Landlord may be required or may in its reasonable discretion deem
necessary to spend or incur by reason of Tenant's default. In such event, Tenant shall
deposit with Landlord the amount so applied within five (5) days of written demand from
Landlord. If Tenant shall have fully complied with all of the covenants and conditions of
this Lease the amount of the Security Deposit then held by Landlord shall be repaid to
Tenant (or, at Landlord's option, to the last assignee of Tenant's interest under this Lease)
within thirty (30) days after the expiration or sooner termination of this Lease. In the event
of Tenant's default under this Lease, Landlord's right to retain the Security Deposit shall be
deemed to be in addition to any and all other rights and remedies available to Landlord
under this Lease, at law or in equity. Landlord shall not be required to keep any Security
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Deposit separate from its general funds and Tenant shall not be entitled to any interest on
the Security Deposit.
6. USES; COMPLIANCE WITH LAWS.
6.1. Permitted Uses. The Premises are to be used only for the Permitted Uses,
and for no other business or purpose without the prior written consent of Landlord, which
consent may be withheld if Landlord, in its reasonable discretion, determines that any
proposed use is inconsistent with or detrimental to the maintenance and operation of the
Building as a similar office building or is inconsistent with any restriction on use of the
Property contained in any lease, mortgage or other agreement or instrument by which the
Landlord may be bound or to which any of the Property may be subject. Tenant shall not
vacate or abandon the Premises, or a significant portion thereof, Tenant agrees to conduct
normal business operations of the Permitted Uses within the Premises on a continuous
basis, except for weekends, holidays and temporary closures not to exceed two (2)
continuous weeks.
6.2. Duties and Prohibited Conduct. Notwithstanding anything to the contrary
in this Lease, Tenant shall not commit any act that will increase the then -existing rate of
insurance on the Building without Landlord's prior written consent. Tenant shall promptly
pay upon demand the amount of any increase in insurance rates caused by the Permitted
Uses or by any act or acts of Tenant or its employees, agents or representatives. Tenant
shall not commit or allow to be committed any waste upon the Premises, or any public or
private nuisance or other act which disturbs the quiet enjoyment of any other tenant of the
Property or which is unlawful. Tenant shall not, without the written consent of Landlord,
use any apparatus, machinery or device in or about the Premises, or act in any way, which
will cause any substantial noise, or any vibration, fumes, or releases of Hazardous
Substances into the surrounding environment. If any of Tenant's office machines,
equipment or activities should disturb the quiet enjoyment of any other tenant in the
Building, cause any substantial noise, or cause any vibration, fumes or releases of
Hazardous Substances, then Tenant, at Tenant's sole expense, shall provide adequate
insulation or take such other action as may be necessary to eliminate such disturbance,
noise, vibration, fumes or releases. Tenant, at Tenant's expense, shall comply with all laws,
rules, regulations, orders, ordinances and permits relating to the Premises, or its use or
occupancy of the Premises, and shall observe such Rules and Regulations as set forth on
Exhibit D to this Lease, and as may be modified by Landlord and made available to
Tenant from time to time. This Lease shall be subject to all applicable zoning ordinances
and to all municipal, county, state and federal laws and regulations governing or regulating
the use of the Premises.
6.3. Environmental, Health And Safety Laws. Without limiting Tenant's
obligations under this Section 6, Tenant in the exercise of its rights and the performance of
its obligations under this Lease shall comply, at Tenant's expense, with all local, state, or
federal laws, rules, regulations, ordinances, orders and permits now existing, or as hereafter
enacted, amended, or issued concerning environmental, health, or safety matters
(collectively, the "Environmental Laws"). Tenant shall not use the Premises for, or permit
anything to be done in or about the Property which may subject Landlord, any guarantor, or
any mortgagee under any mortgage covering the Property, to liability for remediation costs
or other damages or penalties under any Environmental Laws resulting from Tenant's use
of, or conduct on, the Property, including without limitation, the use, generation,
transportation, management, handling, treatment, storage, manufacture, emission, release,
disposal or deposit of any radioactive material, hazardous or toxic wastes, hazardous or
toxic substances, any material containing hazardous wastes or hazardous substances (except
as they occur in normal office products or household cleaning products), or any other
pollutant, contaminant, human pathogen or infectious agent as such terms may now or in
the future be defined in any Environmental Laws (collectively, "Hazardous Substances"),
on the Property, adjacent surface waters, soils, underground waters, or air.
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Landlord shall have the right at all reasonable times upon notice to Tenant to
conduct environmental investigations, including the taking of samples, for the purpose of
detecting or measuring the presence of Hazardous Substances on the Property. Tenant shall
keep Landlord continuously informed by written notice of all Hazardous Substances which
Tenant, or Tenant's employees, agents, representatives, invitees, licensees, or contractors,
generates, stores or otherwise allows on the Property. Tenant shall provide Landlord with
copies of all documents received or prepared by Tenant concerning any release of a
Hazardous Substance at the Property, all documents Tenant receives or prepares in
connection with any violation, or alleged violation, of an Environmental Law by Tenant,
and all reports or other documents Tenant is required to provide any governmental authority
under any Environmental Law concerning any Hazardous Substance. Upon request by
Landlord, Tenant shall provide Landlord with all other information which Landlord
reasonably deems necessary or useful for the purpose of determining whether Tenant is in
compliance with all Environmental Laws and whether the Property, or any part of the
Property, is contaminated by any Hazardous Substances. If Tenant or the Premises is in
violation of any Environmental Law, or in the event of a release of Hazardous Substances
into or on the Property or adjacent surface waters, soils, underground waters, or air, Tenant
shall (i) immediately notify Landlord in writing of such occurrence and the action necessary
to correct or mitigate such occurrence, and (ii) take such action as is necessary to mitigate
and correct such violation or release. Provided, however, Landlord reserves the right, but
not the obligation, to enter the Premises, to act in place of the Tenant (and Tenant hereby
appoints Landlord as its agent for such purposes) and to take such action as Landlord deems
necessary to ensure compliance or to mitigate the violation, at Tenant's expense. If
Landlord has a reasonable belief that Tenant is in violation of any Environmental Law, or
that Tenant's actions or inaction presents a threat of violation or a threat of damage to the
Property, Landlord reserves the right to enter the Premises and take such corrective or
mitigating action as Landlord deems necessary. All costs and expenses incurred by
Landlord in connection with any such actions shall become immediately due and payable
by Tenant upon presentation of an invoice therefore.
Tenant shall not conduct or permit others to conduct environmental testing on the
Premises without first obtaining Landlord's written consent. Tenant shall promptly inform
Landlord of the existence of any environmental study, evaluation, investigation or results of
any environmental testing conducted on the Premises whenever the same becomes known
to Tenant and Tenant shall provide copies to Landlord, upon request by Landlord and at no
cost to Landlord. Notwithstanding the foregoing, in no event shall Tenant be responsible
for or liable to Landlord for any Hazardous Substances located in the Premises that existed
or were released upon the Premises prior to the Commencement Date of this Lease.
Notwithstanding any other provisions of this Lease, Tenant's obligations and
responsibilities for the proper use, storage and maintenance of Hazardous Substances and
for any breach of the obligations pursuant to this Paragraph 6.3, shall survive any expiration
or any termination of this Lease.
7. SERVICES AND UTILITIES; REPAIRS AND MAINTENANCE.
7.1. Services and Utilities; Landlord's Obligations. If in Landlord's
reasonable opinion Tenant's consumption of any utility is extraordinary, Landlord shall be
entitled to install, maintain and operate, at Tenant's cost, a monitoring/ metering system(s)
in the Premises to measure Tenant's consumption of water, electricity (including electricity
to Tenant's signage, if any) HVAC or other utilities or services, or to measure the added
demands on the Premises' electrical or HVAC systems resulting from Tenant's equipment
or lights, including without limitation, Tenant's improvements pursuant to Exhibit C, if
any.
Landlord's obligation to provide the services and utilities described in this Section
7.1 is subject to Section 11 (Damage And Destruction) and Section 22 (Condemnation).
7.2. Additional Services Or Utilities. Before installing fixtures, lights or
equipment in the Premises, which in the aggregate exceed, or which otherwise consume or
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require services or utilities exceeding standard warehouse -type levels, Tenant shall obtain
the written permission of Landlord. Landlord may refuse to grant such permission unless
Tenant agrees to pay Landlord's costs, including Landlord's administrative fee, for
installation of separate meters, supplementary air conditioning capacity or electrical
systems as necessitated by such equipment or lights. In addition, Tenant shall pay Landlord
as Additional Rent the amount estimated by Landlord (including Landlord's administrative
fee) as the cost of furnishing services or utilities for the operation of such equipment or
lights and the cost of operation and maintenance of any supplementary air conditioning
units necessitated by Tenant's use of such equipment or lights.
During other than normal business hours (7:00 a.m. to 6:00 p.m., weekdays),
Landlord may restrict access to the Building in accordance with the Building's security
system, provided that Tenant shall have at all times during the Term of this Lease (24 hours
of all days) reasonable access to the Premises.
If after request by Tenant, Landlord furnishes other services or utilities in addition
to the utilities or services required to be provided by Landlord under this Lease, including
without limitation, furnishing utilities or services at times other than Normal Business
Hours or in amounts exceeding standard warehouse use, then the cost of such non-standard
or additional services or utilities, as reasonably established by Landlord, shall be paid by
Tenant as Additional Rent.
7.3. Services and Utilities; Tenant's Obligations. Tenant shall be solely
responsible for providing, and shall pay directly, all charges for janitorial services to the
Premises and for any security services desired by Tenant in addition to Landlord's standard
Building and site security services. Tenant shall be solely responsible for providing, at
Tenant's cost, any backup electricity generator desired by Tenant. It is understood that
except as provided in Sections 7.1 or 7.4, Landlord shall not be required to provide any
services or utilities to Tenant, and Tenant shall make all necessary arrangements to have
such services and utilities billed directly to Tenant and paid directly by Tenant. Tenant
shall pay its share, as reasonably determined by Landlord, of any unique services or
equipment used by Tenant which are shared by other tenants of the Building, such as
generators, dilution tanks and air compressors.
7.4. Interruption. Landlord shall not be liable for any loss, injury or damage to
persons or property caused by or resulting from any variation, interruption, or failure of
services or utilities to be provided by Landlord under this Lease due to any cause
whatsoever, including without limitation, Landlord's failure to make any repairs or perform
any maintenance required to be performed by Landlord under this Lease. No temporary
variation, interruption or failure of services or utilities to be provided by Landlord under
this Lease incident to the making of repairs, alterations or improvements, or due to
accident, strike or conditions or events beyond Landlord's reasonable control, shall be
deemed an eviction of Tenant or relieve Tenant from any of Tenant's obligations under this
Lease.
7.5. Landlord's Repair and Maintenance Obligations. Except as provided in
Sections 9 (Improvements and Alterations by Tenant), 11 (Damage or Destruction) or 22
(Condemnation), Landlord shall cause to be maintained in reasonably good order and
condition the Building (other than any leased premises) and the public and common areas
of the Property, such as lobbies, elevators, stairs, corridors and restrooms; provided,
however, Tenant shall be responsible for the cost of repair of damage occasioned by any act
or omission of Tenant or Tenant's officers, contractors, agents, invitees, licensees or
employees, subject to Section 12, Waiver of Subrogation. Landlord shall maintain and
repair the Premises' water, if applicable, and elevator service at all times during the term of
the Lease.
7.6. Tenant's Repair and Maintenance Obligations. Except for maintenance,
replacements and repairs required to be made or provided by Landlord under Sections 7.1
or 7.4, Tenant, at its sole cost and expense, shall provide for the maintenance in accordance
with the manufacturer's recommendations, repair and replacement within the Premises and
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all built-in appliances and equipment, including any private restrooms and associated
plumbing, which are in the Premises for Tenant's exclusive use and any security systems or
services desired by Tenant in addition to any such systems or services as may be provided
by Landlord under this Lease.
7.7. Additional Security. In the event that Tenant's use of the Premises, or its
presence in the Building, results in the need for additional security for the Premises or the
Building, as determined by Landlord, then any additional security provided by Landlord for
the Building or the Premises shall be at Tenant's sole cost and expense, and shall be
reimbursed by Tenant to Landlord within five (5) days of written demand. This Section
shall include, without limitation, any additional security required as a result of labor
disturbances, strikes, political protests, dangerous activities, and any other disturbance or
disruption of any kind.
7.8. Tenant's Obligations. In performing its obligations under this Section 7,
Tenant, at Tenant's expense, shall comply with all Environmental Laws and all other
applicable laws, ordinances, codes, orders, rules or regulations of any governmental
authority. Tenant shall retain, and shall provide Landlord upon request, copies of Tenant's
maintenance and service contract(s). Except as provided in Section 9 in connection with
Alterations, before making or performing any work, repairs, or replacement of any kind in
the Premises, if such work shall affect the Building's systems or costs of operation to
Landlord then Tenant shall obtain Landlord's prior written approval, which approval may
be conditioned on Tenant providing Landlord with plans and specifications therefore, if
applicable, which are acceptable to Landlord. All work, maintenance, repairs and
replacements by Tenant under this Lease shall be performed by licensed contractors
acceptable to Landlord. Tenant shall provide Landlord with copies of all contracts or
purchase orders, for such work, maintenance, repairs and replacements prior to having such
work, maintenance, repairs or replacements performed. Before installing any heavy
equipment or fixtures in the Premises, Tenant shall submit the plans and specifications
therefore to Landlord for Landlord's written approval.
8. ADDITIONAL RENT: OPERATING COSTS AND REAL ESTATE TAXES.
8.1. Definitions. In addition to the Base Rent, Tenant shall pay to Landlord
each month as Additional Rent Tenant's Share of Taxes and of Operating Costs as provided
in this Section 8, using the following definitions:
8.1.1. Taxes. "Taxes" shall mean: (a) real property and personal
property taxes on the Property (based upon the appraised value of the property before any
full or partial exemptions and/or credits, reduction in tax rates, and/or reduction in taxes
payable which are not required by statute to transfer to the Tenant); (b) charges and
assessments (or any installments thereof due during the Lease Year) with respect to (i) the
Property, (ii) any improvements, fixtures and equipment on the Property, and (iii) all other
property of Landlord, real or personal, used directly in the operation of the Property; (c) and
any taxes (or any installment thereof due during the Lease Year) in addition to or in lieu of,
in whole or in part, such real property or personal property taxes; and (d) any other tax
upon leasing of the Property and/or Building or rents collected, but not including any
federal or state income, estate, business and occupation (except to the extent that a rental
tax is imposed as a business and occupation tax), inheritance or franchise tax.
8.1.2. Operating Costs. "Operating Costs" shall mean all expenses
other than Taxes paid or incurred by Landlord for obtaining services and products for
maintaining, operating, equipment replacement, and repairing the Property, including
without limitation, the Property's public and common areas, and the personal property used
in conjunction therewith, and which shall include, without limitation, the costs of Landlord
performing its maintenance and repair obligations under this Lease, depreciation and
amortization of capital improvements made subsequent to the initial development of the
Property or Building which are designed with a reasonable probability of enhancing the
health and/or safety of the Property or improving the operating efficiency of the Property or
Building, security services for the Property, fire alarm system monitoring and testing,
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refuse collection, maintaining water, sewer, storm drainage and other utility systems and
services, common area electricity, gas and other similar energy sources (excluding
electricity for the Premises which will be charged to the Tenant subject to paragraph 8.6
below), supplies, Premises janitorial if provided, common area janitorial and cleaning
services, exterior window washing, landscape planting, maintenance and irrigation, services
of independent contractors (including any market -rate management fees which may be or
become payable to third parties), compensation (including employment taxes and fringe
benefits) of all persons who perform duties in connection with the operation, maintenance
and repair of the Property and its equipment, the maintenance, resurfacing, repair and
striping of parking areas and curbs (including driveways, loading zones and access
easements), downspouts and gutters, lighting and outdoor facilities, premiums for
Landlord's insurance (including applicable finance charges; however the finance charges
may be waived by Tenant making a lump sum payment for its annual share of Landlord's
insurance), insurance deductibles, licenses, permits and inspection fees, a management fee,
reasonable legal, administrative and accounting expenses, and any other expense or charge
whether or not hereinabove described, which in accordance with generally accepted
management practices would be considered an expense of maintaining, operating, or
repairing the Property, excluding or deducting, as appropriate costs of any special services
rendered to individual tenants (including Tenant) for which a special charge is collected
including, without limitation, any specially metered charges. Notwithstanding the
foregoing, Operating Costs shall not include the following:
(1) attorney's fees, accounting fees and other expenditures incurred in
connection with negotiations, disputes and claims of other tenants or occupants of the
Building, except as specifically otherwise provided in this Lease;
(2) costs directly attributable to or for the sole benefit of a tenant, including
Tenant;
(3) rental on ground leases or other underlying leases; except wherein such
lease or agreement is directly related to the operating efficiency and/or maintenance of the
Building, Premises and/or Property;
(4) cost of any work or services to the extent performed for any facility other
than the Building (provided Landlord shall have the right to reasonably allocate the cost of
services provided to more than one facility);
(5)
authority;
(6) charitable or political contributions;
costs due to Landlord's willful violation of any governmental rule or
(7) any fees paid to related parties of Landlord which exceed the market rate for
similar services.
8.1.3. Tenant's Share. "Tenant's Share" in connection with Operating
Costs and Taxes shall mean Tenant's Share of the Property multiplied by actual or
estimated, as the case may be, Operating Costs or Taxes allocated to the Property,
respectively. Notwithstanding anything to the contrary in this Section 8.1.3, in
determining the amount of Operating Costs, for the purpose of this Section 8.1.3: (a) if less
than ninety-five percent (95%) of the Building shall have been occupied by tenants and
fully used by them at any time, Operating Costs shall be increased to an amount equal to the
like Operating Costs which would normally be expected to be incurred had such occupancy
been ninety five percent (95%) and had such full utilization by tenants been made during
the entire period; and (b) if the Landlord is not furnishing any particular work or service
(the cost of which if performed by the Landlord would constitute a Building Operating
Cost) to a tenant who has undertaken to perform such work or service in lieu of the
performance thereof by the Landlord, Operating Costs shall be deemed for the purposes of
Section 8.1.2 to be increased by an amount equal to the additional Operating Costs which
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would reasonably have been incurred during such period by the Landlord if it had at its own
cost furnished such work or service to such tenant.
8.2. Payment of Additional Rent for Estimated Operating Costs and Taxes.
Within thirty (30) days of the Commencement Date or the close of each Lease Year, as
applicable, or as soon thereafter as is practicable, Landlord shall provide Tenant with a
written statement of Tenant's Share of estimated Operating Costs and Taxes for such Lease
Year. Tenant shall pay 1/12 of the amount of any special or specific Tenant charges, and
Tenant's Share of Operating Costs and Taxes as Additional Rent as provided in Section 4
each month during such Lease Year and until such time as Landlord provides Tenant with a
statement of estimated Operating Costs and Taxes for the subsequent Lease Year. If at any
time or times during such Lease Year, it appears to Landlord that Tenant's Share of actual
Operating Costs and/or actual Taxes will vary from the estimated Operating Costs and/or
Taxes by more than five percent (5%) on an annual basis, Landlord may, by written notice
to Tenant, revise its estimate for such Lease Year and Additional Rent payable by Tenant
under this Section 8.2 for such Lease Year shall be increased based on Landlord's revised
estimate.
8.3. Actual Operating Costs and Taxes. Landlord will make reasonable efforts
within ninety (90) days after the close of each Lease Year during the Term hereof for which
an estimated statement was delivered to Tenant pursuant to Section 8.2, to deliver to Tenant
a written statement ("Reconciliation Statement") setting forth Tenant's Share of the actual
Operating Costs and Taxes paid or incurred by Landlord during the preceding Lease Year
(or such prorated portion of such Lease Year if this Lease commences or terminates on a
day other than the first or last day of a Lease Year, based on a 365 -day Lease Year). If the
actual Operating Costs and/or Taxes shown on the Reconciliation Statement for any Lease
Year exceed estimated Operating Costs and/or Taxes paid by Tenant to Landlord pursuant
to Section 8.2, Tenant shall pay the excess to Landlord as Additional Rent within thirty (30)
days after the date of the Reconciliation Statement. If the Reconciliation Statement shows
that actual Operating Costs and/or Taxes are less than the estimated Operating Costs and/or
Taxes paid by Tenant to Landlord pursuant to Section 8.2, then the amount of such
overpayment shall be credited by Landlord to the next Additional Rent payable by Tenant
(or refunded to Tenant in the event of the termination or expiration of this Lease).
Notwithstanding anything to the contrary in this Section 8.3, Tenant's Share of Operating
Costs and Taxes for any partial Lease Year at the end of the Term shall be as shown on
Landlord's statement of estimated Operating Costs and Taxes furnished to Tenant pursuant
to Section 8.2.
8.4. Determinations. The determination of actual and estimated Operating
Costs and Taxes shall be made by Landlord. Landlord or its agent shall keep records in
reasonable detail showing all expenditures made for the items enumerated in this Section 8.
8.5. Tenant's Personal Property Taxes. Tenant shall pay prior to delinquency
all Personal Property Taxes payable with respect to all Property of Tenant located on the
Premises or the Property and, upon Landlord's request, shall promptly provide Landlord
with written proof of such payment. Solely for purposes of this Section 8.5, "Property of
Tenant" shall include Landlord's Work, Tenant's Work and all other improvements which
are paid for by Tenant, and "Personal Property Taxes" shall include all real and personal
property taxes assessed against the Property of Tenant.
8.6. Tenant's Utility Charges. Landlord and Tenant agree that utilities to the
Premises including the cost of utilities to provide Building standard HVAC are not included
in the Base Rent. Landlord will estimate, by meter if possible, the cost of the Tenant's
usage of electricity and natural gas for its Premises, including the cost of utilities to heat
and cool the Premises. Tenant shall pay to the Landlord as Additional Rent each month the
Landlord's estimate of such charges. At the end of each calendar year the Landlord shall
compare the previous 12 months actual charges to its estimates. Any amounts owing shall
be paid by Tenant, and credit amounts shall be refunded to Tenant in accordance with
Section 8.3. Landlord shall adjust its estimates as provided for in Section 8.2.
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9. IMPROVEMENTS AND ALTERATIONS BY TENANT. Except for the
Tenant Improvements, Tenant shall not make any changes, alterations, additions or
improvements in or to the Premises ("Alterations"), including, without limitation, changes
to locks on doors or to plumbing or wiring, without first obtaining the written consent of
Landlord and, where required by Landlord, such Alterations shall be made under the
supervision of a competent architect and/or a licensed structural engineer, and in
accordance with plans and specifications which meet current building standards for quality,
design, and colors if visible from the hallways or exterior, approved by Landlord, which
approval shall not be unreasonably withheld. Prior to commencing any Alterations, Tenant
shall notify Landlord of such work and Landlord shall perform a good faith asbestos
inspection in accordance with applicable laws and regulations. All work with respect to
any Alterations shall be done in a good and workmanlike manner and shall be diligently
prosecuted to completion. In no event shall Tenant's Alterations change or affect the
strength, exterior appearance, roof, or the mechanical, electrical, or plumbing services or
systems, of the Building without Landlord's consent. Tenant shall reimburse Landlord
upon demand for any sums expended by Landlord for examination and approval of plans
and specifications for any and all Alterations. Tenant shall also pay Landlord a sum equal
to the costs incurred by Landlord during any inspection or supervision of any and all
Alterations. All damages or injury to the Property caused by any act or omission of Tenant,
or Tenant's officers, contractors, agents, invitees, licensees or employees, or by any persons
who may be in or upon the Property with the express or implied consent of Tenant,
including but not limited to, damage from cracked or broken glass in windows or doors,
shall be paid by Tenant upon demand by Landlord. Tenant and Tenant's contractor shall
comply with the general conditions for construction as referenced in Exhibit C.
10. ACCESS. During other than Normal Business Hours, Landlord may restrict access
to the Building in accordance with a Landlord provided Building security system. Tenant
shall have at all times during the Lease Term (24 hours of all days) reasonable access to the
Premises. Landlord, at Tenant's cost, shall provide Tenant with security access cards to the
Building if such cards are a part of the Building's security system. Tenant shall permit
Landlord and its agents to enter the Premises at all reasonable times (except in cases of
emergency) for the purpose of inspecting or improving the Premises or the Building or for
performing any of its obligations under this Lease, upon advance notice to Tenant. Nothing
contained in this Section 10 shall be deemed to impose any obligation upon Landlord not
expressly stated elsewhere in this Lease. When reasonably necessary Landlord may
temporarily close entrances, doors, corridors, elevators or other facilities without liability to
Tenant by reason of such closure and without such action by Landlord being construed as
an eviction of Tenant or release of Tenant from the duty of observing and performing any
of the provisions of this Lease, so long as such action does not materially and unreasonably
interfere with Tenant's access to the leased Premises. Landlord shall have the right to enter
the Premises for the purpose of showing the Premises to prospective tenants within the
period of one hundred eighty (180) days prior to the expiration or sooner termination of the
Lease Term. Landlord shall have the right at all times to enter the Premises, with reasonable
notice to Tenant, for the purpose of showing the Premises to prospective purchasers or
lenders.
11. DAMAGE OR DESTRUCTION.
11.1. Damage and Repair. If the Building is damaged by fire or any other cause
to such extent that the cost of restoration, as estimated by Landlord, will equal or exceed
thirty percent (30%) of the replacement value of the Building (exclusive of foundations)
just prior to the occurrence of the damage, or if insurance proceeds sufficient for restoration
are for any reason unavailable, then Landlord may no later than the one hundred twentieth
(120th) day following the damage, give Tenant a notice of its election to terminate this
Lease. In the event of such election; (a) this Lease shall be deemed to terminate on the date
that is thirty (30) days from the date of Tenant's receipt of such notice ("Termination
Date"); (b) Tenant shall surrender possession of the Premises on the Termination Date; and
(c) Rent and Additional Rent shall be apportioned as of the date of Tenant's surrender and
any Rent paid for any period beyond such date shall be repaid to Tenant. If the cost of
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restoration as estimated by Landlord shall amount to less than thirty percent (30%) of said
replacement value of the Building or Property and insurance proceeds sufficient for
restoration are available, or if Landlord does not elect to terminate this Lease, Landlord
shall restore the Building and the Premises (to the extent of the improvements to the
Premises originally provided by Landlord hereunder but excluding any improvements paid
for by Landlord with any tenant allowance or credits, and not including any improvements
made by Tenant) with reasonable promptness, subject to delays beyond Landlord's control
and delays in the making of insurance adjustments by Landlord, and Tenant shall have no
right to terminate this Lease except as provided in this Section 11. If this Lease is
terminated as a result of damage or destruction, then all insurance proceeds from Tenant's
insurance policy on improvements made by Tenant, and/or paid for by Landlord with any
Tenant allowance or credits shall be paid to Landlord. To the extent that the Premises are
rendered untenantable by such damage or by Landlord's restoration work under this
Section, the Base Rent (but not Additional Rent) shall proportionately abate, provided,
however, in the event such damage resulted from or was contributed to, directly or
indirectly, by the act, fault or neglect of Tenant, Tenant's officers, contractors, agents,
employees, invitees or licensees, Base Rent shall abate only to the extent Landlord receives
proceeds from any rental income insurance policy received by Landlord for loss of Rent
under this Lease.
11.2. Destruction During Last Year of Term. Notwithstanding anything to the
contrary in this Lease, in case the Building shall be substantially destroyed by fire or other
cause at any time during the last Lease Year of this Lease, either Landlord or Tenant may
terminate this Lease upon written notice to the other given within thirty (30) days of the
date of such destruction.
11.3. Business Interruption. No damages, compensation or claim shall be
payable by Landlord for inconvenience, loss of business or annoyance arising from any
damage or destruction, repair or restoration of any portion of the Premises or the Building.
Landlord shall use reasonable efforts to effect such repairs promptly.
11.4. Tenant Improvements. Landlord will not carry insurance of any kind on
any improvements or alterations paid for by Tenant under this Lease or paid for pursuant to
any tenant allowance or credits from Landlord, or on Tenant's furniture, furnishings,
fixtures, equipment or appurtenances of Tenant under this Lease and Landlord shall not be
obligated to repair any damage thereto or replace the same. Tenant shall insure its
improvements in accordance with Section 14.3 and proceeds of such insurance shall be
used in any repair or restoration of the Premises.
11.5. Express Agreement. The provisions of this Section 11 shall be considered
an express agreement governing any case of damage or destruction of the Building or
Premises by fire or other casualty.
12. WAIVER OF SUBROGATION. Whether loss or damage is due to the
negligence of either Landlord or Tenant, their agents or employees, or any other cause,
Landlord and Tenant do each hereby release and relieve the other, their agents or
employees, from responsibility for, and waive their entire claim of recovery for, (i) any loss
or damage to the real or personal property of either party located anywhere on the Property,
including the Building itself, arising out of or incident to the occurrence of any of the perils
which are covered, or are required to be covered under this Lease, by their respective
property and related insurance policies, and (ii) any loss resulting from business
interruption at the Premises or loss of rental income from the Building, arising out of or
incident to the occurrence of any of the perils covered by any business interruption
insurance policy, or by any loss of rental income insurance policy, which may be held by
Landlord or Tenant. Each party shall use best efforts to cause its insurance carriers to
consent to the foregoing waiver of rights of subrogation against the other party.
Notwithstanding the foregoing, no such release shall be effective unless and to the extent
the aforesaid insurance policy or policies shall expressly permit such a release or contain a
waiver of the carrier's right to be subrogated.
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13. INDEMNIFICATION. Landlord shall not be liable for, and Tenant shall defend
(unless Landlord waives its right to such defense, and in any event with counsel reasonably
satisfactory to Landlord), indemnify, hold harmless and protect Landlord and its employees
and agents from any claim, demand, liability, judgment, award, fine, mechanics' lien or
other lien, loss, damage, expense, penalty, charge or cost of any kind or character
(including actual attorney fees and court costs) which may be made, incurred or asserted by
Tenant, Tenant's agents or employees, contractors, or any third parties (including but not
limited to Landlord's agents, servants or employees), arising directly or indirectly from:
(a) any labor dispute involving Tenant or its agents or contractors (but excluding labor
disputes involving Landlord or its contractors, subcontractors, or agents); (b) the
construction, repair, alteration, improvement, use, occupancy or enjoyment of the Premises
by Tenant its contractors, agents, employees and/or customers, licensees, or invitees;
(c) injury to, or death of, any person or persons or damage to, or destruction of, any
property (including without limitation the costs of investigation, removal or remedial action
and disposal of any hazardous or toxic substances, as such terms may be defined under any
applicable federal, state, or municipal law, statute, rule or regulation) occurring in, on or
about the Premises, unless it is the result of Landlord's gross negligence; or (d) Tenant's
breach of this Lease or the acts or omissions of Tenant or its officers, directors,
shareholders, employees, contractors, subcontractors, or agents (the "Claims").
Notwithstanding anything to the contrary in this Section 13, nothing in this Section 13 shall
relieve Landlord from responsibility for its proportionate share of its fault attributable to its
negligence or willful misconduct in causing any such Claims. TENANT HEREBY
WAIVES ITS IMMUNITY WITH RESPECT TO LANDLORD UNDER THE
INDUSTRIAL INSURANCE ACT (RCW TITLE 51) AND/OR THE
LONGSHOREMEN'S AND HARBOR WORKER ACT, AND/OR ANY EQUIVALENT
ACTS AND TENANT EXPRESSLY AGREES TO ASSUME POTENTIAL LIABILITY
FOR ACTIONS BROUGHT AGAINST LANDLORD BY TENANT'S EMPLOYEES.
THIS WAIVER HAS BEEN SPECIFICALLY NEGOTIATED BY THE PARTIES TO
THIS LEASE AND TENANT HAS HAD THE OPPORTUNITY TO, AND HAS BEEN
ENCOURAGED TO, CONSULT WITH INDEPENDENT COUNSEL REGARDING
THIS WAIVER.
Tenant shall, at its sole cost and expense, indemnify, defend and hold harmless
Landlord and Landlord's subsidiaries and parent corporations, shareholders, members,
managers, directors, officers, employees, partners, affiliates, and agents from, any claims,
liabilities, costs or expenses incurred or suffered arising in connection with any Hazardous
Materials which are not brought on the Premises or the Property by Landlord, Landlord's
employees, agents, vendors, visitors or contractors. Tenant's indemnification, defense, and
hold harmless obligations include, without limitation, the following: (i) claims, liability,
costs or expenses resulting from or based upon administrative, judicial (civil or criminal) or
other action, legal or equitable, brought by any private or public person under common law
or under the Comprehensive Environmental Response, Compensation and Liability Act of
1980 as amended ("CERCLA"), the Resource Conservation and Recovery Act of 1980
("RCRA") or any other Federal, State, County, or Municipal law, ordinance, or regulation
now or hereafter in effect; (ii) claims, liabilities, costs or expenses pertaining to the
indemnification, monitoring, clean-up, containment or removal of Hazardous Materials
from soils, riverbeds or aquifers including the provision of an alternative public drinking
water source; (iii) all costs of defending such claims; and (iv) all other liabilities,
obligations, penalties, fines, claims, actions (including remedial or enforcement actions of
any kind and administrative or judicial proceedings, orders or judgments), damages
(including consequential and punitive damages), and costs (including attorney, consultant,
and expert fees and expenses) resulting from the release or violation. This indemnity shall
survive the expiration or termination of this Lease.
Tenant shall not be liable for, and Landlord shall defend (unless Tenant waives its
rights to defense, and in any event with counsel reasonably satisfactory to Tenant),
indemnify, hold harmless and protect Tenant and its employees and agents from any claim,
demand, liability, judgment, award, fine, mechanics lien or other lien, loss, damage,
expense, penalty, charge or cost of any kind of character (including reasonable attorneys'
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fees and court costs) which may be made, incurred by or asserted against Tenant by third
parties arising or resulting from damage to property or injury to person to the extent caused
by the negligence or willful misconduct of Landlord, its employees, agents, servants or
representatives.
14. INSURANCE.
14.1. Worker's Compensation. Commencing on the earlier of the
Commencement Date or the date Tenant first enters onto the Premises and continuing
throughout the Term of this Lease and any renewal hereof, Tenant shall, at its own expense,
keep and maintain in full force and effect, all required worker's compensation coverages,
including employer's liability at a limit of not less than One Million Dollars ($1,000,000).
14.2. Liability Insurance. Commencing on the earlier of the Commencement or
the date Tenant first enters onto the Premises, Tenant shall, throughout the Term of this
Lease and any renewal hereof, at its own expense, keep and maintain in full force and
effect, a policy of commercial general liability insurance on an occurrence form, including
but not limited to Premises and operations; blanket contractual; products/completed
operations; owners' and contractors' protective; employer's contingent liability (stop gap);
personal injury; insuring Tenant's activities upon, in or about the Premises or the Building
against claims of bodily injury or death or property damage or loss with a combined single
limit of not less than Two Million Dollars ($2,000,000) per occurrence and Two Million
Dollars ($2,000,000) in the aggregate. General aggregate shall apply on a per location
basis. Landlord and others as required by Landlord shall be an additional insured.
Additionally, Tenant shall maintain automobile coverage with a combined single
limit of not less than One Million Dollars ($1,000,000). Coverage shall apply to any
owned, non -owned or hired automobiles.
14.3. Property Insurance. Tenant shall, throughout the Term of this Lease and
any renewal hereof, at its own expense, keep and maintain in full force and effect special
form perils coverage on Tenant's furniture, furnishings, fixtures, personal property, and
equipment, and on any improvements and alterations to the Premises made by Tenant,
including without limitation, any improvements made by Landlord on behalf Tenant or
pursuant to a tenant allowance or credit at one hundred percent (100%) of the current
replacement cost value on an agreed amount basis.
Landlord is not required to carry insurance of any kind on Tenant's furniture,
furnishings, fixtures, personal property, and equipment, and on any improvements and
alterations to the Premises made by Tenant, including without limitation, any improvements
made by Landlord on behalf of Tenant or pursuant to a Tenant allowance or credit under
this Lease and Landlord shall not be obligated to repair any damage thereto or replace the
same.
14.4. Insurance Policy Requirements. All policies of insurance required under
this Section 14 shall be with companies reasonably approved by Landlord. No insurance
policy required under this Section 14 shall be cancelled or reduced in coverage except after
forty-five (45) days (ten (10) days for non-payment of premium) prior written notice to
Landlord. All insurers shall have a Best's rating of AV or better and be licensed and
admitted to do business in the State of Washington. The property and liability policies
required under this Section 14 shall be written as primary policies and not contributing to
nor in excess of any coverage Landlord may choose to maintain. Tenant's insurance
policies maintained under Section 14.3 shall contain an Agreed Amount Endorsement, and
shall include a Loss Payee endorsement in favor of Landlord.
Tenant shall deliver to Landlord prior to occupancy or entrance onto the Premises
and at least annually thereafter, copies of policies of such insurance or certificates with
endorsement, evidencing the existence of the minimum required insurance and evidencing
Landlord, Landlord's mortgagee, and any other persons or entities requested by Landlord to
be named as additional insureds hereunder. In no event shall the limits of any insurance
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policy required under this Section 14 be required under this Section 14 be considered as
limiting the liability of Tenant under this Lease or be considered as necessarily adequate.
In no event shall the limits or coverages required to be carried be considered as
necessarily adequate nor limiting the liability of Tenant under this Lease.
14.5. Failure to Maintain Insurance. If Tenant fails or refuses to maintain any
insurance required, Landlord may, at its option, procure insurance for Landlord's benefit
and/or interests and any and all premiums paid by Landlord therefore shall be deemed
Additional Rent and shall be due on demand. Landlord will not be responsible to procure
insurance for Tenant's interests and/or benefit.
14.6. Increased Insurance Costs. Tenant shall not keep, use, sell or offer for
sale in or upon the Premises, nor conduct any operation, which may be prohibited by
Landlord's insurance carriers. Tenant shall pay any increase in premiums for property and
liability insurance that may be charged during the Lease Term on the amount of such
insurance which may be carried by Landlord on the Premises or the Building or Buildings
of which they are a part, resulting from Tenant's occupancy or from the type of
merchandise which Tenant stores or sells on the Premises, whether or not Landlord has
consented thereto. In the event of increased insurance costs to Landlord, Tenant shall also
pay an additional premium on the insurance policy or policies that Landlord may carry for
its protection against loss resulting from any insured event. In determining whether
increased premiums are the result of Tenant's use of the Premises, rates and/or premiums
determined by the organization and/or underwriter setting the insurance rates and/or
charges on the Premises of Building or Buildings of which they are a part shall be
conclusive evidence of the several items and charges which make up the insurance
premium. Landlord shall deliver bills for such additional premiums to Tenant at such times
as Landlord may elect, and Tenant shall immediately reimburse Landlord therefore.
14.7 Self -Insurance. Landlord hereby consents to Tenant's right to comply
with and satisfy the obligations contained in this Section 14 as to maintenance of policies
of insurance by acting as a self -insurer as to the applicable insurance coverage, King
County, a charter county government under the constitution of the State of Washington,
hereinafter referred to as "Tenant", maintains a fully funded Self -Insurance program as
defined in King County Code 4.12 for the protection and handling of the
County's liabilities including injuries to persons and damage to property.
Landlord acknowledges, agrees and understands that the Tenant is self-funded for all of
its liability exposures. The Tenant agrees, at its own expense, to maintain, through its
self-funded program, coverage for all of its liability exposures for this Lease Agreement.
The Tenant agrees to provide the Landlord with at least 30 days prior written notice of
any material change in the County's self-funded program and will provide the Landlord
with a certificate of self-insurance as adequate proof of coverage. Landlord further
acknowledges, agrees and understands that the Tenant does not purchase Commercial
General Liability insurance and is a self-insured governmental entity; therefore the
Tenant does not have the ability to add the Landlord as an additional insured.
Should the Tenant elect to cease self-insuring its liability exposures and purchase
Commercial General Liability insurance, Tenant agrees to add the Landlord as an
additional insured and comply with Section 14 above.
15. ASSIGNMENT AND SUBLETTING.
15.1. Assignment or Sublease. Tenant shall not assign, mortgage, encumber or
otherwise transfer this Lease or sublet the whole or any part of the Premises without in each
case first obtaining Landlord's prior written consent, which consent may not be
unreasonably conditioned, delayed or withheld. Tenant also acknowledges that any right
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of first refusal, option to extend the Term of this Lease, terminate this Lease, or any other
options which Landlord has granted herein are particular to Tenant are not assignable or
transferable to any assignee or sublessee under this Lease.
In no event shall an assignment, subletting or other transfer of the Lease relieve
Tenant of any of its obligations under this Lease. Consent to any such assignment,
subletting or transfer shall not operate as a waiver of the necessity for consent to any
subsequent assignment, subletting or transfer.
If such consent is requested, Landlord reserves the right to terminate this Lease, or,
if consent is requested for subletting less than the entire Premises, to terminate this Lease
with respect to the portion for which such consent is requested, at the proposed effective
date of such subletting. In the event of any such termination, Landlord may enter into the
relationship of Landlord and Tenant with any such subtenant or assignee, based on the rent
(and/or other compensation) and the term agreed to by such subtenant or assignee and
otherwise upon the terms and conditions of this Lease.
If Tenant is a corporation, any transfer of this Lease by merger, consolidation or
liquidation, or any change in the ownership of a majority of its outstanding voting stock, or
power to vote a majority of its outstanding voting stock, shall constitute an assignment for
the purpose of this Section 15; provided, however, for the purposes of this Section 15, a
public offering of stock registered with the SEC, shall not constitute a transfer. If Tenant is
a partnership, limited liability company, or other entity, any transfer of this Lease by
merger, consolidation, liquidation, dissolution, or any change in the ownership of a majority
of the ownership and/or economic interests shall constitute an assignment for the purpose of
this Section 15.
15.2. Documentation and Expenses. In connection with each request for an
assignment or subletting Tenant shall: (i) submit in writing to Landlord the name and legal
composition of the proposed subtenant or assignee, the nature of the proposed subtenant's
or assignee's business to be carried on in the Premises, the terms and provisions of the
proposed sublease or assignment and such reasonable financial information as Landlord
may request concerning the proposed subtenant or assignee; and (ii) pay Landlord's
reasonable costs of processing such assignment or subletting, including attorneys' fees,
upon demand of Landlord. Tenant shall provide Landlord with copies of all assignments,
subleases and assumption instruments.
15.3. Transferee Obligations. As a condition to Landlord's approval of an
assignment, any potential assignee otherwise acceptable to Landlord shall assume, in
writing, all of Tenant's obligations under this Lease and Tenant and such assignee shall
agree, in writing, to be jointly and severally liable for the performance of all of Tenant's
obligations under this Lease. As a condition to Landlord's approval, any sublessee
otherwise acceptable to Landlord shall assume, in writing, all of Tenant's obligations under
this Lease as to the subleased portion of the Premises and Tenant and such sublessee shall
agree, in writing, to be jointly and severally liable with Tenant for Rent and performance of
all of the terms, covenants, and conditions of such approved sublease. If an assignment or
sublease is consented to by Landlord, then the Tenant shall pay all costs incurred in
connection therewith (including any lease commissions and lease concessions), and the
assignment or sublease shall state that all payments from the assignee or sublessee shall be
paid directly to Landlord. In connection with a permitted assignment or sublease , so long
as the Tenant is not in default under this Lease, Landlord shall grant to Tenant a credit
against the monthly rental due under this Lease in the amount of the rental actually received
by Landlord under the assignment or sublease for that month, calculated on a per square
foot basis, and based upon the portion of the Premises covered by the assignment or
sublease. The maximum credit for any month under this Section 15.3 shall be equal to the
per square foot rental due under this Lease. (By way of example only, if the then applicable
monthly rental under this Lease is $2.50 per square foot, and there is a sublease providing
for monthly rental of $2.75 per square foot, then the maximum monthly credit under this
Section 15.3 shall be $2.50 per square foot times the number of square feet covered by the
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sublease, and with the credit being applicable only once the payment is received by
Landlord from the sublessee.) If in any month Tenant is entitled to a credit under this
Section 15.3, but the credit arises after the Tenant has paid in full the rental due under this
Lease for that month, then Landlord shall pay the amount of the credit within five (5)
business days after the date that the payment is received by Landlord from the assignee or
sublessee.
16. SIGNS. Tenant shall not inscribe any inscription, or post, place, or in any manner
display any sign, graphics, notice, picture, placard or poster, or any advertising matter
whatsoever, anywhere in or about the Property at places visible (either directly or indirectly
as an outline or shadow on a glass pane) from anywhere outside the Premises without first
obtaining Landlord's written consent, such consent to be at Landlord's sole discretion. Any
such consent by Landlord shall be upon the understanding and condition that Tenant shall
remove the same at the expiration or sooner termination of this Lease and Tenant, at its
expense, shall repair any damage to the Property, or any portion thereof, caused by such
removal. Notwithstanding the foregoing, if Tenant is permitted to place signage on the
Building such signage must be pre -approved by Landlord's architect and must comply with
local laws. The cost of such signage, maintenance, repair and operation shall be borne
exclusively by Tenant.
17. LIENS. Tenant has no authority to allow any liens to be placed against the
Property. Tenant shall keep its interest in this Lease, any property of Tenant located on the
Property, and the Property free from any liens arising out of any work performed or
materials ordered or obligations incurred by or on behalf of Tenant and Tenant hereby
agrees to indemnify, defend and hold Landlord harmless from and against any liability from
any such lien, including without limitation, liens arising from Tenant's Work. In the event
any lien is filed against the Property, or any portion thereof, by any person claiming by,
through or under Tenant, Tenant shall, upon request of Landlord and at Tenant's expense,
immediately either cause such lien to be released of record or furnish to Landlord a bond, in
form and amount and issued by a surety, satisfactory to Landlord, indemnifying Landlord
and the Property against all liability, costs and expenses, including attorneys' fees, which
Landlord may incur as a result thereof. Provided that such bond has been furnished to
Landlord, Tenant, at its sole cost and expense and after written notice to Landlord, may
contest, by appropriate proceedings conducted in good faith and with due diligence, any
lien, encumbrance or charge against the Property arising from work done or materials
provided to and for Tenant, if, and only if, such proceedings suspend the collection thereof
against Landlord, Tenant and the Property and neither the Property nor any part thereof or
interest therein is or will be, in Landlord's sole judgment, in any danger of being sold,
forfeited or lost.
18. BANKRUPTCY.
18.1. Assumption of Lease. In the event Tenant becomes a Debtor under
Chapter 7 of the Bankruptcy Code ("Code") or a petition for reorganization or adjustment
of debts is filed concerning Tenant under Chapters 11 or 13 of the Code, or a proceeding is
filed under Chapter 7 of the Code and is transferred to Chapters 11 or 13 of the Code, the
Trustee or Tenant, as Debtor and as Debtor -In -Possession, may not elect to assume this
Lease unless, at the time of such assumption, the Trustee or Tenant has cured all defaults
under the Lease and paid all sums due and owing under the Lease or provided Landlord
with "Adequate Assurance" (as defined below) that: (i) within ten (10) days from the date
of such assumption, the Trustee or Tenant will completely pay all sums due and owing
under this Lease and compensate Landlord for any actual pecuniary loss resulting from any
existing default or breach of this Lease, including without limitation, Landlord's reasonable
costs, expenses, accrued interest, and attorneys' fees incurred as a result of the default or
breach; (ii) within twenty (20) days from the date of such assumption, the Trustee or Tenant
will cure all non -monetary defaults and breaches under this Lease, or, if the nature of such
non -monetary defaults is such that more than twenty (20) days are reasonably required for
such cure, that the Trustee or Tenant will commence to cure such non -monetary defaults
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within twenty (20) days and thereafter diligently prosecute such cure to completion; and
(iii) the assumption will be subject to all of the provisions of this Lease.
18.1.1. Definition of Adequate Assurances. For purposes of this
Section 18, Landlord and Tenant acknowledge that in the context of a bankruptcy
proceeding involving Tenant, at a minimum, "Adequate Assurance" shall mean: (i) the
Trustee or Tenant has and will continue to have sufficient unencumbered assets after the
payment of all secured obligations and administrative expenses to assure Landlord that the
Trustee or Tenant will have sufficient funds to fulfill the obligations of Tenant under this
Lease; and (ii) the Bankruptcy Court shall have entered an Order segregating sufficient cash
payable to Landlord and/or the Trustee or Tenant shall have granted a valid and perfected
first lien and security interest and/or mortgage in or on property of Trustee or Tenant
acceptable as to value and kind to Landlord, to secure to Landlord the obligation of the
Trustee or Tenant to cure the monetary and/or non -monetary defaults and breaches under
this Lease within the time periods set forth above; and (iii) the Trustee or Tenant, at the
very minimum, shall deposit a sum equal to two (2) month's Base Rent to be held by
Landlord (without any allowance for interest thereon) to secure Tenant's future performance
under the Lease.
18.2. Assignment of Lease. If the Trustee or Tenant has assumed the Lease
pursuant to the provisions of this Section 18 for the purpose of assigning Tenant's interest
hereunder to any other person or entity, such interest may be assigned only after the
Trustee, Tenant or the proposed assignee have complied with all of the terms, covenants
and conditions of this Lease, including, without limitation, those with respect to Additional
Rent. Landlord and Tenant acknowledge that such terms, covenants and conditions are
commercially reasonable in the context of a bankruptcy proceeding of Tenant. Any person
or entity to which this Lease is assigned pursuant to the provisions of the Code shall be
deemed without further act or deed to have assumed all of the obligations arising under this
Lease on and after the date of such assignment. Any such assignee shall upon request
execute and deliver to Landlord an instrument confirming such assignment.
18.3. Adequate Protection. Upon the filing of a petition by or against Tenant
under the Code, Tenant, as Debtor and as Debtor -In -Possession, and any Trustee who may
be appointed agree to adequately protect Landlord as follows: (i) to perform each and
every obligation of Tenant under this Lease until such time as this Lease is either rejected
or assumed by Order of the Bankruptcy Court; (ii) to pay all monetary obligations required
under this Lease, including without limitation, payment of Rent and Additional Rent
payable hereunder which is considered reasonable compensation for the use and occupancy
of the Premises; (iii) provide Landlord a minimum of thirty (30) days prior written notice,
unless a shorter period is agreed to in writing by the parties, of any proceeding relating to
any assumption of this Lease or any intent to abandon the Premises, which abandonment
shall be deemed a rejection of this Lease; and (iv) to perform to the benefit of Landlord as
otherwise required under the Code. The failure of Tenant to comply with the above shall
result in an automatic rejection of this Lease.
19. DEFAULT.
19.1. Cumulative Remedies. All rights of Landlord in this Lease shall be
cumulative, and none shall exclude any other right or remedy allowed by law in force when
the default occurs or in equity. In addition to the other remedies provided in this Lease,
Landlord shall be entitled to restrain by injunction (without bond) the violation or attempted
violation of any of the covenants, agreements or conditions of Tenant under this Lease.
19.2. Tenant's Default; Right to Cure. The failure of Tenant to perform any
obligation of Tenant as provided in this Lease shall be a default under this Lease. Tenant
shall have a period of five (5) business days from the date of Tenant's receipt of written
notice from Landlord to Tenant within which to cure any default in the payment of Rent.
Tenant shall have a period of ten (10) business days from the date of written notice from
Landlord to Tenant to cure any other default under this Lease; provided, however, that with
respect to any such default which cannot be cured within such ten (10) day period, the
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default shall not be deemed to be uncured if Tenant commences to cure within ten (10) days
and for so long as Tenant is diligently prosecuting the cure thereof, but in no event longer
than ninety (90) days. If the nature of the default is one that can be cured immediately (e.g.
turn off loud music, take unauthorized sign off door, etc.), Tenant will use its best efforts to
cure immediately. Notwithstanding anything herein to the contrary, if Tenant is in default
under any covenant, condition, or agreement of this Lease more than one (1) time within
any twelve (12) month period, irrespective of whether or not such default is cured,
Landlord, at its sole election, in its sole and absolute discretion, and without notice to
Tenant, may exercise any and all of its available rights and remedies.
19.3. Landlord's Rights And Remedies. Upon the occurrence of an uncured
default by Tenant, Landlord, in addition to all other rights or remedies it may have, at its
option, may exercise any one or more of the following rights without further notice or
demand of any kind to Tenant or any other person, except as required by applicable State
law:
19.3.1. Termination of Lease. The right of Landlord to terminate this
Lease and Tenant's right to possess the Premises and to reenter the Premises, take
possession thereof and remove all persons from the Premises, following which Tenant shall
have no further claim thereon or hereunder; provided, however, that Tenant shall remain
obligated as provided in Section 19.4 below.
19.3.2. Re-entry of the Premises. The right of Landlord, without
terminating this Lease and Tenant's right to possess the Premises, to reenter the Premises
and occupy the whole or any part of the Premises for and on account of Tenant and to
collect any unpaid Rents which have become payable, or which may thereafter become
payable; provided, however, that Tenant shall remain obligated as provided in Section 19.4
below.
19.3.3. Termination After Reentry. The right of Landlord, even
though it may have reentered the Premises in accordance with Section 19.3.2, to elect
thereafter to terminate this Lease and Tenant's right to possess the Premises; provided,
however, that Tenant shall remain obligated as provided in Section 19.4 below.
Should Landlord reenter the Premises under Section 19.3.2, Landlord shall not be
deemed to have terminated this Lease or to have accepted a surrender thereof by any such
reentry, unless Landlord shall have notified Tenant in writing that it has so elected to
terminate this Lease and Tenant's right of possession. Tenant further covenants that
Landlord's service of any notice pursuant to the unlawful detainer statutes of the State of
Washington and Tenant's surrender of possession pursuant to such notice shall not (unless
Landlord elects in writing to the contrary at the time of, or at any time subsequent to, the
serving of such written notice and such election is evidenced by a notice to Tenant) be
deemed to be a termination of this Lease.
19.4. Landlord's Damages. If Landlord terminates this Lease and/or Tenant's
right to possession of the Premises pursuant to the terms of this Section 19, Landlord may
recover from Tenant as damages, all of the following:
19.4.1. Delinquent Rent. The worth at the time of award of any unpaid
Rent earned at the time of such termination;
19.4.2. Rent After Termination Until Judgment. The worth at the
time of award of the amount by which the unpaid Rent that would have been earned after
termination until the time of award exceeds such rent loss Tenant proves could have been
reasonably avoided;
19.4.3. Rent After Judgment. The worth at the time of award of the
amount by which the unpaid Rent for the balance of the Lease Term after the time of award
exceeds the amount of such rent loss that Tenant proves could be reasonably avoided;
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19.4.4. Leasing Concessions. The unamortized portion of any financial
concessions incurred by Landlord on Tenant's behalf to arrange for Tenant's leasing of the
Premises that Landlord conditionally waived at the commencement of the Lease in
consideration of Tenant's full performance of this Lease, but which upon termination of the
Lease pursuant to this Section 19 shall accrue as Rent, which costs include, but are not
limited to, leasing commissions, tenant allowances and improvements (including without
limitation, the cost of any improvements to the Premises by Landlord pursuant to Exhibit
C), "free rent" allowances and other such concessions in this Lease, amortized on a
straight-line basis over the number of months during the Lease Term in which Tenant is
obligated to pay Base Rent, and such amounts shall become immediately due and payable
as Rent earned at the time of such termination of the Lease;
19.4.5. Other Compensation. Any other amount necessary to
compensate Landlord for all the detriment proximately caused by Tenant's failure to
perform its obligations under this Lease or which in the ordinary course of things would be
likely to result there from, including, without limitation, any cost or expense incurred by
Landlord in (i) retaking possession of the Premises, including reasonable attorney fees
therefore, (ii) maintaining or preserving the Premises after such default, (iii) preparing the
Premises for reletting to a new tenant, including repairs necessary to the Premises for such
reletting, (iv) leasing commissions, limited to those years remaining in the initial term, and
(v) any other costs necessary or appropriate to relet the Premises; and
19.4.6. Additional or Alternative Damages. At Landlord's election,
such other amounts in addition to or in lieu of the foregoing in this Section 19.4 as may be
permitted from time to time by the laws of the State of Washington; and
19.4.7. Calculation of Damages. As used in Sections 19.4.1 and 19.4.2,
the "worth at the time of award" is to be computed by allowing interest at the rate specified
in Section 4.2. As used in Section 19.4.3, the "worth at the time of award" is computed by
discounting such amount at a discount rate equal to six percent (6%) per annum. All Rent,
other than Base Rent, shall, for the purposes of calculating any amount due under the
provisions of Section 19.4.3 be computed on the basis of the average monthly amount
thereof accruing during the immediately preceding sixty (60) month period, except that if it
becomes necessary to compute such rent before such a sixty (60) month period has
occurred, then such rent shall be computed on the basis of the average monthly amount
hereof accruing during such shorter period.
19.5. Tenant's Property. Without limiting any of Landlord's rights under this
Lease, in the event of a termination of this Lease pursuant to Section 19, any of Tenant's
property which, pursuant to this Lease, may be removed by the Tenant (not including
attached furniture and equipment specified on Exhibit C-1) shall be removed by Tenant
immediately upon demand by Landlord. If not so removed by Tenant, Landlord may
remove such property from the Premises and place it in storage at a public warehouse at the
expense and risk of Tenant, after which it shall be subject to the sale provisions of Section
21. Without limiting any of Landlord's rights under this Lease, in the event of a
termination of this Lease pursuant to Section 19, all attached furniture and equipment
specified on Exhibit C-1 shall be deemed real property and shall be Landlord's property as
part of the Premises upon termination.
19.6. No Waiver. The waiver by Landlord of any breach of any term, covenant
or condition contained in this Lease shall not be deemed to be a waiver of such term,
covenant or condition or any subsequent breach thereof, or of any other term, covenant or
condition contained in this Lease. Landlord's subsequent acceptance of partial rent or
performance by Tenant shall not be deemed to be an accord and satisfaction or a waiver of
any preceding breach by Tenant of any term, covenant or condition of this Lease or of any
right of Landlord to a forfeiture of the Lease by reason of such breach, regardless of
Landlord's knowledge of such preceding breach at the time of Landlord's acceptance. No
term, covenant or condition of this Lease shall be deemed to have been waived by Landlord
unless such waiver is in writing and signed by Landlord.
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19.7. Waiver of Notice. Notwithstanding anything to the contrary in this Section
19, Tenant waives (to the fullest extent permitted under law) any written notice, other than
such notice as this Section 19 or any other provision of this Lease specifically requires,
which any statute or law now or hereafter in force prescribes be given Tenant.
19.8. Waiver of Redemption Rights. Tenant, for itself, and on behalf of any and
all persons claiming through or under it, including creditors of all kinds, does hereby waive
and surrender all right and privilege which they or any of them might have under or by
reason of any present or future law, to redeem the Premises or to have a continuance of this
Lease for the term hereof, as it may have been extended, after having been dispossessed or
ejected there from by process of law or under the terms of this Lease or after the
termination of this Lease as herein provided.
19.9. Default by Landlord. Landlord's failure to perform or observe any of its
obligations under this Lease or to correct a breach of any warranty or representation made
in this Lease within thirty (30) days after receipt of written notice from Tenant setting forth
in reasonable detail the nature and extent of the failure referencing pertinent Lease
provisions or if more than thirty (30) days is required to cure the breach, Landlord's failure
to begin curing within the thirty (30) day period and diligently prosecute the cure to
completion, shall constitute a default. If Landlord commits a default that materially affects
Tenant's use of the Premises, and Tenant has provided simultaneous written notice thereof
to Landlord's mortgagee (if any and if Tenant has notice thereof) and Landlord (and/or
Landlord's mortgagee if any) has failed to commence to cure such default within thirty (30)
days (or such shorter time as is commercially reasonable in the case of an emergency
threatening imminent harm to persons or property), Tenant may, without waiving any claim
for damages for breach of agreement, thereafter cure the default for the account of the
Landlord, which cure shall be preceded by an additional written notice given at least three
(3) days prior to such cure to Landlord and Landlord's mortgagee that Tenant plans to
undertake the cure, and the reasonable cost of such cure shall be deemed paid or incurred
for the account of Landlord, and Landlord shall reimburse Tenant for Tenant's out-of-
pocket expenditures paid to third parties to effectuate such cure, such reimbursement to be
within thirty (30) days after completion of the cure and invoice to Landlord showing the
costs of cure. Tenant's cure rights shall be in lieu of any right to terminate this Lease;
Tenant shall not have the right to terminate this Lease for a Landlord default. If Landlord
disputes either the necessity of the cure or the cost thereof, the matter shall be settled by
arbitration administered by the American Arbitration Association in accordance with its
Rules for the Real Estate Industry before a single neutral arbitrator of the American
Arbitration Association sitting in Seattle, Washington. The arbitrator shall be a person
having at least ten (10) years' experience and knowledge about commercial leasing and
property management. The arbitration shall be held within sixty (60) days of Landlord
notifying Tenant it disputes Tenant's cure. The costs of the arbitrator shall be shared
equally by the parties. The prevailing party shall be entitled to an award of reasonable
attorney's fees. The arbitrator's award shall be final and binding on the parties.
19.10. Cross Default. Any default or breach under any other lease or agreement
between Landlord or Landlord's affiliate and Tenant or Tenant's affiliate or any guarantor
of Tenant's or Tenant's affiliate, which is not cured within the applicable cure period, if
any, shall constitute a default under this Lease. Any default or breach under this Lease
which is not cured within the applicable cure period shall constitute a default under any
other lease or agreement between Landlord or Landlord's affiliate and Tenant or Tenant's
affiliate or any guarantor of Tenant's or Tenant's affiliate.
20. SUBORDINATION AND ATTORNMENT. This Lease shall be subordinate to
any mortgage or deed of trust now existing or hereafter placed upon the Land, the Building
or the Premises, created by or at the instance of Landlord, and to any and all advances to be
made hereunder and to interest thereon and all modifications, renewals and replacements or
extensions thereof ("Landlord's Mortgage"); provided, however, that the holder of any
Landlord's Mortgage or any person or persons purchasing or otherwise acquiring the Land,
Building or Premises at any sale or other proceeding under any Landlord's Mortgage may
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elect to continue this Lease in full force and effect and, in such event, Tenant shall attorn to
such person or persons. Notwithstanding the foregoing, if a lender requires that the Lease
be subordinate to any mortgage recorded after the date of the Lease affecting the Property,
the Lease shall be subordinate to such mortgage if Landlord first obtains from such lender a
written statement providing that so long as Tenant performs its obligations under the Lease,
no foreclosure of, deed given in lieu of foreclosure of, or sale under the mortgage, and no
steps or procedures, taken under the mortgage, shall affect Tenant's rights under this Lease;
provided, however, then the holder of Landlord's Mortgage, or any person or persons
purchasing or otherwise acquiring the Land, Building or Premises at any sale or other
proceeding under any Landlord's Mortgage, shall not be subject to any option to purchase,
or right of first refusal to purchase, granted to Tenant in connection with this Lease.
Tenant shall execute, acknowledge and deliver documents, which the Holder of any
Landlord's Mortgage may require to effectuate the provisions of this Section 20 within ten
(10) days of the date of Landlord's request therefore. In the event of any transfer of
Landlord's interest in the Premises or in the Property, other than a transfer for security
purposes only, the transferor shall be automatically relieved of any and all obligations and
liabilities on the part of Landlord accruing from and after the date of such transfer and such
transferee shall have no obligation or liability with respect to any matter occurring or
arising prior to the date of such transfer. Tenant agrees to attorn to such transferee,
provided transferee assumes all of Landlord's responsibilities. If any holder of any
Landlord's Mortgage shall request reasonable modifications to this Lease, Tenant shall not
unreasonably withhold, delay or defer its consent thereto, provided such modifications do
not have a materially adverse affect on Tenant's rights hereunder.
21. REMOVAL OF PROPERTY. Subject to Section 19.5, upon the expiration of this
Lease, Tenant shall remove Tenant's personal property not permanently affixed to the
Premises or as specified on Exhibit C-1, and shall pay Landlord any damages for injury to
the Premises or Property resulting from such removal. If Tenant fails to remove any such
property from the Premises at the expiration of this Lease, Landlord may remove and store
said property without liability for loss thereof or damage thereto. Such storage shall be for
the account and at the expense of Tenant. If Tenant fails to pay the cost of storing any such
property after it has been stored for a period of thirty (30) days or more, or if Tenant has not
removed the property from the Premises after a thirty (30) day period, Landlord may, at its
option, sell, or permit to be sold, any or all such property at public or private sale, in such
manner and at such times and places as Landlord in its sole discretion may deem proper,
without notice to Tenant, unless notice is required under applicable statutes, and shall apply
the proceeds of such sale first, to the cost and expense of such sale, including reasonable
attorneys' fees actually incurred; second, to the payment of the costs or charges for storing
any such property; third, to the cost of removal of such property and the restoration of the
Premises following such removal; fourth, to the payment of any other sums of money
which may then be or thereafter become due Landlord from Tenant under any of the terms
of this Lease; and, fifth, the balance, if any, shall be paid to Tenant.
22. CONDEMNATION.
22.1. Entire Taking. If all of the Premises, or such portion of the Building as
may be required for the reasonable use of the Premises, in Landlord's determination, are
taken by eminent domain, this Lease shall automatically terminate as of the date title vests
in the condemning authority and all Rent, Additional Rent and other payments shall be paid
to that date.
22.2. Constructive Taking of Entire Premises. In the event of a taking by
eminent domain of a material part of but less than all of the Building, if Landlord
determines that the remaining portions of the Building cannot be economically and
effectively used by it (whether on account of physical, economic, aesthetic or other reasons)
or if Landlord determines the Building should be restored in such a way as to materially
alter the Premises, then Landlord shall forward a written notice to Tenant of such
determination not more than sixty (60) days after the date of taking. The Term of this
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Lease shall expire upon the date specified by Landlord in such notice but not earlier than
sixty (60) days after the date of such notice.
22.3. Partial Taking. Subject to the provisions of the preceding Section 22.2, in
case of taking by eminent domain of a part of the Premises, or a portion of the Building not
required for the reasonable use of the Premises, then this Lease shall continue in full force
and effect and the Rent shall be equitably reduced based on the proportion by which the
floor area of the Premises is reduced, such Rent reduction to be effective as of the date title
to such portion vests in the condemning authority. If more than twenty-five percent (25%)
of the Premises is taken and Landlord cannot replace such space with space in the Building,
which is mutually acceptable to Landlord and Tenant, then with sixty (60) days written
notice by either party, Landlord or Tenant shall have the right to terminate this Lease.
22.4. Awards and Damages. Landlord reserves all rights to damages to the
Premises for any partial, constructive, or entire taking by eminent domain, and Tenant
hereby assigns to Landlord any right Tenant may have to such damages or award, and
Tenant shall make no claim against Landlord or the condemning authority for damages for
termination of the leasehold interest or interference with Tenant's business. Tenant shall
have the right, however, to claim and recover from the condemning authority compensation
for any loss to which Tenant may be put for Tenant's moving expenses, business
interruption or taking of Tenant's personal property (not including Tenant's leasehold
interest) provided that such damages may be claimed only if they are awarded separately in
the eminent domain proceedings and not out of or as part of and/or will not reduce any
damages recoverable by Landlord.
23. NOTICES. All notices under this Lease shall be in writing and delivered in person
or sent by registered or certified mail, postage prepaid, or by facsimile, or by private
overnight courier to Landlord and to Tenant at their respective Notice Addresses set forth in
Section 1.16 (provided that after the Commencement Date any such notice shall be mailed,
delivered by hand or transmitted by facsimile to Tenant at the Premises) or such other
addresses as may from time to time be designated by any such party in writing. Notices
mailed as provided in this Section shall be deemed given and received on the date that is
three (3) business days following the date of post mark, in the case of mailing, or the date of
transmission confirmation by the sender's facsimile machine, in the case of facsimile
transmission, or one (1) day after deposit with a private overnight courier.
24. COSTS AND ATTORNEYS' FEES. If Tenant or Landlord brings any action for
any relief against the other, declaratory or otherwise, arising out of this Lease, each party
shall, and hereby does to the extent permitted by law, waive trial by jury and the losing
party shall pay the substantially prevailing party's attorneys' fees in connection with such
suit, at trial and on appeal, and such attorneys' fees shall be deemed to have accrued on the
commencement of such action. If Landlord consults with an attorney as a result of a default
by Tenant hereunder, Tenant agrees to pay any such attorneys' fees incurred by Landlord,
and such attorneys' fees shall constitute additional sums due by Tenant hereunder. In
addition, in the event of a default by Tenant under this Lease, and any action is instituted by
Landlord as a result of Tenant's default, then Tenant shall pay to Landlord, in addition to
other costs, expenses, and attorneys' fees incurred by Landlord, an hourly fee of Fifty
Dollars ($50.00) per hour for time spent by each employee or agent of Landlord in
connection with such default and at a minimum, One Hundred Dollars ($100.00).
25. LANDLORD'S LIABILITY. Notwithstanding anything in this Lease to the
contrary, covenants, undertakings and agreements herein made on the part of Landlord in
this Lease are made and intended not as personal covenants, undertakings and agreements
for the purpose of binding Landlord personally or the assets of Landlord (except Landlord's
interest in the Premises and Building), but are made and intended for the purpose of binding
only the Landlord's interest in the Premises and Building, as the same may from time to
time be encumbered. No personal liability or personal responsibility is assumed by
Landlord, nor shall at any time be asserted or enforceable against Landlord or its heirs,
legal representatives, successors or assigns on account of the Lease or on account of any
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covenant, undertaking or agreement of Landlord in this Lease. If all or any portion of
Landlord's estate in the Building is sold, assigned or conveyed to any person, firm or
corporation upon the exercise of any remedy provided for in any mortgage, deed of trust, or
by law or equity, such person, firm or corporation and each person, firm or corporation
thereafter succeeding to its interest in the Building: (a) shall not be liable for any act or
omission of Landlord under this Lease occurring prior to such sale or conveyance, (b) shall
not be subject to any offset, defense or counterclaim accruing prior to such sale or
conveyance, (c) shall not be bound by any payment prior to such sale or conveyance of Base
Rent, Additional Rent or other payments for more than one month in advance, and (d) shall
be liable for the keeping, observance and performance of the other covenants, agreements,
terms, provisions and conditions to be kept, observed and performed by Landlord under this
Lease only during the period such person, firm or corporation shall hold such interest. In no
event shall any incidental, consequential, special, exemplary, speculative, or punitive
damages, including without limitation any claims for loss or imputed revenues, profits,
and/or business opportunities be part of any Landlord liability. Any Landlord liabilities
will also be limited to the amount of Base Rent received from Tenant over the Term of this
Lease.
26. LANDLORD'S CONSENT. Except as may be provided otherwise in this Lease,
whenever Landlord's consent is required under this Lease, such consent shall not be
unreasonably withheld, conditioned or delayed, provided, however, Landlord's withholding
of consent due to any mortgagee's refusal to grant its consent shall not be deemed
unreasonable.
27. ESTOPPEL CERTIFICATES. Tenant shall, from time to time upon the written
request of Landlord, execute, acknowledge and deliver to Landlord or its designee a written
statement stating: the Effective Date, Commencement Date and Expiration Date, the date
the term commenced and the date Tenant accepted the Premises; the amount of Base Rent
and the date to which such Base Rent and Additional Rent has been paid; and certifying
such additional information as may be requested by Landlord. It is intended that any such
statement delivered pursuant to this Section may be relied upon by Landlord and/or a
prospective purchaser or mortgagee who may acquire an interest in, or a lien upon,
Landlord's interest in the Building. If Tenant shall fail to respond within ten (10) days of
receipt by Tenant of a written request by Landlord as herein provided, Tenant shall be
deemed to have given such certificate as above provided without modification and shall be
deemed to have admitted the accuracy of any information supplied by Landlord to a
prospective purchaser or mortgagee and to have certified that this Lease is in full force and
effect, that this Lease represents the entire agreement between the parties as to this leasing,
that there are no existing claims, defenses or offsets which Tenant has against enforcement
of the Lease by Landlord, that there are no uncured defaults in Landlord's performance, that
the security deposit is as stated in the Lease, and that not more than one month's Base Rent
or Additional Rent has been paid in advance.
28. RIGHT TO PERFORM. If Tenant fails to pay any sum of money required to be
paid by it under this Lease or fails to perform any other act on its part to be performed
under this Lease, and such failure continues for ten (10) days after notice thereof by
Landlord, Landlord may, but shall not be obligated to do so, and without waiving or
releasing Tenant from any obligations of Tenant, make such payment or perform any such
other act on Tenant's part to be made or performed as provided in this Lease. Landlord
shall have (in addition to any other right or remedy of Landlord) the same rights and
remedies in the event of the nonpayment of sums due under this Section 28 as in the case of
default by Tenant in the payment of Rent.
29. PARKING. In the event that Landlord elects to regulate parking on the Property
pursuant to a parking pass system, then Tenant shall be entitled to one (1) parking stall per
each 1,000 rentable square feet of Premises at no charge during the Term of this Lease, and
the parking area for Tenant's parking pass holders shall be in the parking area(s) shown on
Exhibit E. Each parking pass may be used by one person only, and may not be shared; no
sharing or hoteling of stalls shall be permitted. Use of the parking stalls shall be subject to
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such rules and regulations, as Landlord and/or Landlord's parking operator may adopt from
time to time. Landlord retains the right to alter such rules and regulations and to relocate
within the area as outlined on Exhibit E, or reconfigure the parking area shown on Exhibit
E, with reasonable notice to Tenant, but Landlord shall at all times continue to provide the
designated number of passes to Tenant. Tenant shall pay, upon demand by Landlord,
Landlord's costs incurred to stencil any changes to reserved parking stalls provided to
Tenant under this Lease.
30. AUTHORITY. If Tenant is a corporation, each individual executing this Lease on
behalf of Tenant represents and warrants that he or she is duly authorized to execute and
deliver this Lease on behalf of Tenant, in accordance with a duly adopted resolution of the
Board of Directors of Tenant and in accordance with the bylaws of Tenant, and that this
Lease is binding upon Tenant in accordance with its terms. If Tenant is a partnership or
limited liability company, each individual executing this Lease on behalf of Tenant
represents and warrants that he or she is duly authorized to execute and deliver this Lease
on behalf of Tenant, in accordance with the partnership or operating agreement of Tenant,
and that this Lease is binding upon Tenant in accordance with its terms. If Tenant is
a governmental or public entity or authority of any kind, each individual executing this
Lease on behalf of Tenant represents and warrants that (1) this Lease is valid, binding, and
enforceable against Tenant, (2) he or she is duly authorized to execute and deliver this
Lease on behalf of Tenant, (3) this Lease was approved in accordance with all applicable
laws, ordinances, rules or regulations (collectively "Laws"), and (4) all resolutions or other
approvals required to be obtained in order for Tenant to enter into this Lease have in fact
been obtained and all applicable appeal periods have expired with no appeal having been
filed.
31. GENERAL.
31.1. Headings. Titles to Sections of this Lease are not a part of this Lease and
shall have no effect upon the construction or interpretation of this Lease.
31.2. Heirs and Assigns. All of the covenants, agreements, terms and conditions
contained in this Lease shall inure to and be binding upon the Landlord and Tenant and
their respective heirs, executors, administrators, successors and assigns.
31.3. No Brokers. Except as provided in Section 1, Landlord and Tenant
represent and warrant to one another that they have not engaged any broker, finder or other
person who would be entitled to any commission or fees in respect of the negotiation,
execution or delivery of this Lease and Landlord and Tenant shall indemnify and hold one
another harmless from and against any loss, cost, liability or expense incurred by the other
party as a result of any claim asserted by any such broker, finder or other person on the
basis of any arrangements or agreements made or alleged to have been made by or on
behalf of the other party. In no event will a brokerage fee be paid on any renewal or Option
to renew. Tenant agrees that any broker it may elect to assist in any renewal discussions or
options will be compensated directly by Tenant.
31.4. Tenant's Financial Statement. If Tenant is not a publicly listed and traded
company, within ten (10) days of receipt by Tenant of Landlord's written request, Tenant
shall deliver to Landlord a copy of its most recent annual and quarterly financial statements
prepared in accordance with generally accepted accounting principles, including a balance
sheet, income statement, statement of changes in stockholder's or owner's equity, statement
of cash flow, accompanying footnotes, and reports of independent accountants. Landlord
shall hold Tenant's financial information in confidence and agrees to execute a reasonable
confidentiality agreement if so requested by Tenant. Such financial information may be
provided to a prospective purchaser or mortgagee, subject to the same confidentiality
requirements.
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31.5. Entire Agreement. This Lease contains all covenants and agreements
between Landlord and Tenant relating in any manner to the leasing, use and occupancy of
the Premises, to Tenant's use of the Building and other matters set forth in this Lease. No
prior agreements or understanding pertaining to the same shall be valid or of any force or
effect and the covenants and agreements of this Lease shall not be altered, modified or
added to except in writing signed by Landlord and Tenant.
31.6. Severability. Any provision of this Lease which shall prove to be invalid,
void or illegal shall in no way affect, impair or invalidate any other provision hereof and the
remaining provisions hereof shall nevertheless remain in full force and effect.
31.7. Force Majeure. (A) Landlord. Landlord shall have no liability
whatsoever to Tenant on account of Landlord's inability to timely complete Landlord's
Work, or the restoration of the Building and the Premises following damage or destruction,
as a result of "force majeure," which shall include (a) strike, lockout, other labor trouble,
dispute or disturbance; (b) governmental regulation, moratorium, action, preemption or
priorities or other controls; (c) shortages of fuel, supplies or labor; (d) any failure or defect
in the supply, quantity or character of electricity or water furnished to the Premises by
reason of any requirement, act or omission of the public utility or others furnishing the
Building with electricity or water; and (e) for any other reason, whether similar or
dissimilar to the above, or for Act of God, beyond Landlord's reasonable control. If this
Lease specifies a time period for performance of an obligation of Landlord to complete
Landlord's Work, or the restoration of the Building and the Premises following damage or
destruction, that time period shall be extended by the period of any delay in Landlord's
performance caused by any of the events of force majeure described herein.
(B) Tenant. Tenant shall have no liability whatsoever to Landlord on account of
Tenant's inability to timely complete Tenant's Work, or the restoration of the Tenant's
Work following damage or destruction, as a result of "force majeure," which shall include
(a) strike, lockout, other labor trouble, dispute or disturbance; (b) governmental regulation,
moratorium, action, preemption or priorities or other controls; (c) shortages of fuel, supplies
or labor; (d) any failure or defect in the supply, quantity or character of electricity or water
furnished to the Premises by reason of any requirement, act or omission of the public utility
or others furnishing the Building with electricity or water; and (e) for any other reason,
whether similar or dissimilar to the above, or for Act of God, beyond Tenant's reasonable
control. If this Lease specifies a time period for performance of an obligation of Tenant to
complete Tenant's Work, or the restoration of Tenant's Work following damage or
destruction, that time period shall be extended by the period of any delay in Tenant's
performance caused by any of the events of force majeure described herein. Nothing in this
section shall be construed as excusing or delaying the obligation of Tenant to pay in a
timely manner when due any Rent or other amounts due under this Lease.
31.8. Right to Change Public Spaces. Landlord shall have the right at any time
without thereby creating an actual or constructive eviction or incurring any liability to
Tenant therefore, to change the arrangement or location of such of the following as are not
contained within the Premises or any part thereof: entrances, passageways, doors and
doorways, corridors, stairs, toilets and other public portions of the Property. In no event,
however, shall Landlord diminish any service provided by Landlord under this Lease, make
any change which reduces the area of the Premises, make any change which, on other than
a temporary basis, either changes the character of the Building from that of an office
building or materially interferes with Tenant's access to and use of the Building.
31.9. Governing Law. This Lease shall be governed by and construed in
accordance with the laws of the State of Washington.
31.10. Building Directory. In the event Landlord maintains in the lobby of the
Building a directory of tenants, such directory shall include the name of Tenant and any
other names reasonably requested by Tenant in proportion to the number of listings given to
comparable tenants of the Building. Tenant will also be required to provide suite signage
consistent with the Building standard or subject to Landlord's architects' approval.
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31.11. Building Name. The Building will be known as Integate.East Building 1 or
by such name as Landlord may designate from time to time.
31.12. Quiet Enjoyment. Landlord agrees that Tenant, upon paying the Rent and
performing all other terms, covenants and conditions of this Lease to be performed by
Tenant, may quietly have, hold and enjoy the Premises from and after the Commencement
Date until the Expiration Date, subject, however, to the provisions of Section 11 (Damage
Or Destruction), 22 (Condemnation), and to any sale or Landlord's Mortgage to which this
Lease is, or may become, subordinate.
31.13. Survival. The representations, warranties and indemnification obligations
of the parties to this Lease shall survive the termination or expiration of this Lease.
31.14. Lender's Consent. The effectiveness of this Lease is contingent upon and
subject to the approval of Landlord's lender.
31.15. Time. Time is of the essence as to each and every provision of this Lease.
31.16. Interpretation. This Agreement has been submitted to the scrutiny of all
parties hereto and their counsel, if desired, and shall be given a fair and reasonable
interpretation in accordance with the words hereof, without consideration or weight being
given to its having been drafted by any party hereto or its counsel.
31.17. Execution. This Agreement may be executed in several counterparts and all
so executed shall constitute one Agreement, binding on all the parties hereto even though all
the parties are not signatories to the original or the same counterpart. Delivery of a facsimile
or other copy of this Agreement has the same effect as delivery of an original.
IN WITNESS WHEREOF this Lease has been executed the day and year first
above set forth.
Date: 4 -fit R/ 2, ol
Date:
LANDLORD:
International Gateway East LLC,
by Sabey rporation, Manager
By: vitteti ! k.
Its: Treasurer & Secreta
TENANT:
City of Tukwila
By: !.
Jim .;gerto
Its:Mayor
Approved as to form
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STATE OF WASHINGTON
COUNTY OF KING
) ss.
On this 3O'"day of , 2009, before me, the undersigned, a
Notary Public in and for the State of Washington, duly commissioned and sworn as such,
personally appeared Patricia A. Sewell, to me known to be the Treasurer & Secretary of
SABEY CORPORATION, Manager of International Gateway East LLC, the corporation
that executed the within and foregoing instrument, and acknowledged the said instrument to
be the free and voluntary act and deed of said corporation for the uses and purposes therein
mentioned, and on oath stated that he was authorized to - ecute sale instrument.
WITNESS my hand and official se. - day . • year i certificate first abovedars"---priffaillivi raw*Aare L,4,4101 -A' AftPJA:.
1111\\\\\\\:\\"
Printed Name:
NOTARY PUBL C in and for the State of Washington,
residing at r /� rm
My commission expires: �� l l/ %
STATE OF WASHINGTON )
) ss.
COUNTY OF KING )
On this 1-- day of
, 2009, before me, the undersigned, a
Notary Public in and for the State o Washi : on, duly commissioned and sworn as such,
personally appeared Jim Haggerton, to me own to be the Mayor of the City of Tukwila
the municipality that executed the within and foregoing instrument, and acknowledged the
said instrument to be the free and voluntary act and deed of said municipality for the uses
and purposes therein mentioned, and on oath stated that he was authorized to execute said
instrument.
WITNESS my hand and official seal the day and year in this certificate first above
Printed Name: ( 1 S ��-j i • ' t ---La korl j
NOTARY PUBLIC i and for -the State of Washington,
residing at Gt. rY14 -
My commission expires: 3-9-1 p�
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EXHIBIT A
TO LEASE AGREEMENT
LEGAL DESCRIPTION
LOT 5 OF BOUNDARY LINE ADJUSTMENT NO. L02-087 RECORDED UNDER
KING COUNTY RECORDING NO. 20030327900002, RECORDS OF KING COUNTY,
AS AMENDED BY RECORDING NUMBER 200307250001852, RECORDS OF KING
COUNTY; SITUATE IN THE CITY OF TUKWILA, COUNTY OF KING, STATE OF
WASHINGTON
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EXHIBIT B
TO LEASE AGREEMENT
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SABEY ARCHITECTURE
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Office Lease Agreement-NNN
G:\Legal\WP\DOC\IG East\JGEAS'I\City of TukwilaLEASE 1.DOC
Rev. 3/17/09 11:06 AM B-1
EXHIBIT C
TO LEASE AGREEMENT
LANDLORD'S WORK AND TENANT'S WORK
I. IMPROVEMENTS PROVIDED BY LANDLORD
Landlord's Work to the Premises shall consist of the following:
Except for such Landlord's Work listed below, Landlord shall deliver, and Tenant
shall accept the Premises in its "AS -IS" condition and configuration as provided in the
Lease. Without limiting the foregoing, Landlord shall not be required to modify or improve
the existing heating, exhaust, ventilation or air-conditioning equipment, to reinforce or level
the flooring of the Premises or the existing electrical system, to accommodate Tenant.
Tenant shall incur the cost of any additional alterations, improvements, and repairs
including all wiring & cabling for data and communications.
1. Finish the entire lower ceiling (roughly 10 feet above ground) to the full extent. The
completion of the lower ceiling will allow the eventual chain link fence & gates erection.
2. Provide adequate reading -level lighting throughout the entire premise. The central
lighting switch shall be on the right-hand side of the entry door, when a person enters the
premise.
3. Remove all vertical pipes running from the floor to the ceiling, except those essential
utility pipes.
4. Patch and level the floor to support shelving. There may be some variation in elevation.
5. Complete and paint all drywalls, and the exposed upper ceiling.
6. Provide door locks & keys for the only entry door to the storage space. Allow for two
exit doors - one for the City other departments section, and another one for the Police
Department section. Seal up all other existing doors to prevent unauthorized entries.
Existing doors and frames may remain in place if secured. See attached drawing for
details.
7. Provide additional electrical outlets. See the attached drawing for details.
8. Provide one phone jack in the common area for City other departments and the Police
Department. The location is likely on the left-hand side of the roll -up door, when a
person enters through the roll -up door. City will contract with and pay provider for
wiring and service.
9. Provide one high-speed internet cable outlet in the common area for City other
departments and the Police Department. The location is likely on the left-hand side of
the roll -up door, when a person enters through the roll -up door. City will contract with
and pay provider for wiring and service.
10. Provide heating & ventilation system for the premise with one thermostat. The location
of the thermostat is likely in the area on the left-hand side of the entry door, when a
person enters the premise, but not at the corner fence area.
11 Provide an outlet for the new alarm system panel. The location of the alarm system panel
is likely in the area on the left-hand side of the entry door, when a person enters the
premise, but not at the corner fence area. The landlord shall accommodate for the alarm
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system installation & operation in the premise , City will pay for the system, panel and
associated wiring and monitoring.
12. The landlord shall accommodate for chain link fence & gate installations in the premise
and City will pay for the fencing, gates and installation.
13. The landlord shall accommodate for shelving installations in the premise. City will pay
for shelving and installation.
14. Provide a fully functional sprinkler system for the entire premise. The sprinkler system
shall include smoke detection function, and be able to alert the Fire Department & City's
designated staff when a fire or smoke event breaks out.
15. Patch the pedestrian pathway leading to the exterior building door entry.
16. Remove the rusted steel plate and its bolted -in nails in front of the roll -up door.
17. Provide gas & electrical meters, City to pay all utility usage.
18. Provide a clean premise before the City starts its fencing & security system installations.
II. CONSTRUCTION OF TENANT IMPROVEMENTS
A. Improvements Constructed by Tenant. If any work is to be performed in
connection with Tenant Improvements on the Premises by Tenant or Tenant's contractor:
(1) Such work shall proceed upon Landlord's written approval of
(i) Tenant's contractor, (ii) public liability and property damage insurance satisfactory to
Landlord carried by Tenant's contractor, (iii) detailed plans and specifications for such
work. Landlord's approval of the foregoing shall not be unreasonably withheld or delayed,
and (iv) Landlord shall have the right to require Tenant's contractor to deposit a reasonable
amount to secure the close-out and clean-up of Tenant's Work.
(2) All work shall be done in conformity with a valid building permit
when required, a copy of which shall be furnished to Landlord before such work is
commenced, and in any case, all such work shall be performed in accordance with all
applicable governmental regulations. Notwithstanding any failure by Landlord to object to
any such work, Landlord shall have no responsibility for Tenant's failure to meet all
applicable regulations.
(3) All work by Tenant or Tenant's contractor shall be scheduled through
Landlord.
(5) Tenant shall promptly reimburse Landlord for costs incurred by
Landlord due to faulty work done by Tenant or its contractors, or by reason of any delays
caused by such work, or by reason of inadequate clean-up.
(6) Landlord shall have the right to require that the work be bonded, or a
deposit in the estimated amount of the work to be performed shall be deposited with
Landlord to secure completion of the work and all lien releases.
(7) Landlord shall have the right to post a notice or notices in conspicuous
places in or about the Premises announcing its non -responsibility for the work being
performed therein.
(8) Landlord shall retain the right to all equipment and materials to be
salvaged or demolished from the Premises.
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If Sabey Construction Inc. constructs the Tenant Improvements on behalf of Tenant,
Landlord acknowledges satisfaction of Paragraphs (1)(i), (1)(ii), 3, 4(i), 5, and 6 of this
Section II.A.
B. Tenant's Entry to Premises. Tenant's entry to the Premises for any
purpose, including without limitation, inspection or performance of Tenant Construction by
Tenant's agents, prior to the Commencement Date as specified in Section 1.6 of the Lease
shall be scheduled in advance with Landlord and shall be subject to all the terms and
conditions of the Lease, except the payment of Rent. Tenant's entry shall mean entry by
Tenant, its officers, contractors, office planner, licensees, agents, servants, employees,
guests, invitees, or visitors.
C. Tenant's Telephone and Data Cabling. Tenant is responsible for all of
Tenant's telephone service, data cabling and computer systems. Tenant shall select Tenant's
telephone system and shall coordinate installation of it and all data cabling with the
Landlord.
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Rev. 4/30/09 8:02 AM C-3
EXHIBIT C-1
TO LEASE AGREEMENT
TENANT'S REMOVABLE PROPERTY
Subject to the terms and conditions of this Lease, the fixtures, improvements,
furniture, equipment and other property of Tenant which may be removed by Tenant from
the Premises at the expiration or earlier termination of this Lease are as set forth below in
this Exhibit C-1. No other improvements, alterations or property shall be removed from the
Premises at the expiration or termination of this Lease except as may be provided otherwise
in the Lease or as may be agreed upon by Landlord and Tenant and added to this Exhibit C-
1 by amendment to this Lease.
1. Upon the termination or expiration of this Lease Tenant, at Tenant's
expense, shall remove all cabling and wiring included within the scope of Tenant's Work,
Landlord's Work, Tenant's Alterations, or which was otherwise installed by Tenant, from all
interstitial/ceiling plenum areas.
2. Furniture and easily removable and unattached personal property.
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Rev. 4/30/09 8:02 AM C-1-1
EXHIBIT D
TO LEASE AGREEMENT
RULES AND REGULATIONS
1. Any directory provided by Landlord for the Building will be for the display of the name
and location of tenants of the Building, and Landlord reserves the right to exclude any
other names from inclusion in any such directory.
2. Tenant shall not place any new or additional locks on any doors of the Premises or re -
key any existing locks without the prior written consent of Landlord.
3. Landlord reserves the right to exclude or expel from the common areas any person who,
in the sole judgment of Landlord, is intoxicated, under the influence of drugs or who
shall in any manner violate any of these Rules and Regulations.
4. Tenant shall not do or permit to be done within the Premises, the building or parking
loading or other adjoining common areas, anything, which would unreasonably annoy
or interfere with the rights of other tenants of the Building.
5. Tenant shall not permit its employees or invitees to loiter in or about the common areas
or obstruct any of the parking, truck maneuvering or other common areas, or to place,
empty or throw away rubbish, litter, trash or material of any nature upon any common
areas.
6. No storage of materials, equipment or property of any kind is permitted outside the
Premises unless otherwise approved in writing by Landlord and any such property may
be removed by Landlord at Tenant's risk and expense.
7. Tenant shall not make or permit any use of the Premises which in the sole judgment of
Landlord, may be dangerous to persons or property; permit any noise, odor or
vibrations to emit from the Premises which are objectionable to Landlord or other
occupants of the Building; or to create, maintain or permit a nuisance or any violation
of any regulation of any governmental agency thereon.
8. Tenant shall not commit or permit to be committed any waste, damage or injury to the
Premises, the Building or parking, loading and other common areas adjoining and shall
promptly notify Landlord in writing of such waste, damage or injury and repair the
same at its expense.
9. Tenant understands that any equipment required for maintenance of the Premises is
Tenant's responsibility and that Landlord has no equipment available for Tenant's use
therefore (e.g. ladders or lifts for re-lamping, etc.).
10. Tenant shall use the Premises and shall operate its equipment on the Premises in a safe
and prudent manner, and any damage or cracks occurring in the floor of the Premises
caused by Tenant shall be promptly brought to the attention of Landlord by written
notice and repaired by Tenant at its expense.
11. Tenant shall not at any time display a "For Rent" sign upon the Premises.
12. Tenant shall be responsible for keeping a copy of the Lease and Landlord's current rules
and regulations upon the Premises.
13. Tenant agrees to cause its employees to park only in such designated areas as may be
designated by Landlord from time to time for employee parking and shall abide by any
rules or regulations concerning parking promulgated by Landlord, or Landlord's agent,
from time to time.
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14. Tenant shall not waste electricity or water and agrees to cooperate fully with Landlord
to assure the most effective and economical use of utilities services as may be provided
to the Building by Landlord.
16. Tenant shall not smoke, and shall cause its employees, contractors, agents and invitees
to refrain from smoking, in the Building except in such areas as may be designated as
smoking areas by Landlord, if any. In the event that Tenant desires to allow smoking in
its Premises and such smoking is permitted under applicable laws, then Tenant, at
Tenant's sole expense and subject to the requirements of Section 9 (Improvements And
Alterations By Tenant), shall first take such action as may be necessary to have a smoke
exhaust system installed in the Premises that is acceptable to Landlord.
17. No pets or other animals are permitted on the Property, including the Premises, at any
time except: (i) dogs which are present on the Property or Premises in their capacity of
providing assistance to a disabled person; and (ii) laboratory animals of tenants leasing
laboratory space and pursuant to terms agreed upon by Landlord in writing prior to such
animals being brought onto the Property.
18. Subject to the terms and conditions of this Lease, any cost incurred for direct services
provided to Tenant beyond Normal Business Hours at Tenant's request, shall be
reimbursable to Landlord or Landlord's Management Agent. Such direct costs to
include after-hours labor charge for "on-call" assistance as may be requested by Tenant
or Tenant's employees. A minimum three (3) hour charge shall be assessed per Tenant
request.
19. Landlord shall not unlock the Premises door for any person known or unknown as an
employee of Tenant without a waiver in writing by Tenant indemnifying Landlord to do
so and under what conditions. Tenant acknowledges that in the event Landlord or
Building security responds to a request for someone to go to the Property to unlock a
door, a minimum Two Hundred Fifty Dollars ($250.00) will be charged if Landlord's
employees unlock the door, and Seventy-five Dollars ($75.00) if Building security
responds to the request.
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