3b attach5
Final Draft: August 7, 2015
WORLD TRADE CENTER WEST BUILDING
LEASE AGREEMENT
BETWEEN
PORT OF SEATTLE
Landlord
and
COLUMBIA HOSPITALITY, INC.
Tenant
POS Term Lease Agreement,
World Trade Center West Building
Columbia Hospitality, Inc.
Final Draft: August 7, 2015
TABLE OF CONTENTS
SECTION 1: DEFINITIONS. ......................................................................................................... 1
SECTION 2: TERM ....................................................................................................................... 2
SECTION 3: RENT ........................................................................................................................ 3
SECTION 4: SECURITY ............................................................................................................... 4
SECTION 5: USES ......................................................................................................................... 5
SECTION 6: SERVICES AND UTILITIES .................................................................................. 6
SECTION 7: COSTS OF OPERATIONS AND TAXES............................................................... 7
SECTION 8: CARE AND IMPROVEMENT OF PREMISES ...................................................... 8
SECTION 9: TELECOMMUNICATIONS LINES AND EQUIPMENT ...................................... 9
SECTION 10: COMMON AREAS .............................................................................................. 11
SECTION 11: INDEMNIFICATION........................................................................................... 11
SECTION 12: INSURANCE ........................................................................................................ 12
SECTION 13: DAMAGE OR DESTRUCTION .......................................................................... 14
SECTION 14: ASSIGNMENT AND SUBLETTING ................................................................. 14
SECTION 15: DEFAULTS AND REMEDIES ........................................................................... 16
SECTION 16: TERMINATION OTHER THAN FOR DEFAULT ............................................ 17
SECTION 17: PRIORITY ............................................................................................................ 18
SECTION 18: ACCESS AND EASEMENTS. ............................................................................ 19
SECTION 19: NON-WAIVER; RIGHT TO PERFORM ............................................................ 19
SECTION 20: SURRENDER AND HOLDING OVER .............................................................. 20
SECTION 21: ENVIRONMENTAL STANDARDS. .................................................................. 20
SECTION 22: MISCELLANEOUS ............................................................................................. 21
SECTION 23: ACKNOWLEDGMENTS .................................................................................... 24
POS Term Lease Agreement - 1 -
World Trade Center West Building
Columbia Hospitality, Inc.
Final Draft: August 7, 2015
LEASE AGREEMENT
WORLD TRADE CENTER WEST BUILDING
THIS LEASE made this ________ day of August 2015 ("Effective Date") between the
PORT OF SEATTLE, a Washington municipal corporation ("Landlord"), and COLUMBIA
HOSPITALITY, INC., a Washington corporation ("Tenant").
NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the Landlord and Tenant agree as follows:
SECTION 1: DEFINITIONS.
The following terms as used in this Lease shall have the meanings provided in this Section,
unless otherwise specifically modified by provisions of this Lease. Other terms may be defined
elsewhere in the Lease.
1.1. Building and Premises.
1.1.1. Building. "Building" shall mean The World Trade Center West
Building, or such other name as Landlord may designate from time to time, situated on a portion
of the real property located in the City of Seattle, legally described in its entirety on Exhibit A
attached hereto and incorporated herein, and with an address of 2200 Alaskan Way, Seattle,
Washington 98121 in King County. Unless the context clearly requires otherwise, the Building
specifically includes the land upon which the Building is located.
1.1.2. Premises. "Premises" shall mean 9,182 rentable square feet within
Suite 200 and 798 rentable square feet within Suite 210, both on the second floor of the Building,
as outlined on the floor plan attached hereto and incorporated herein as Exhibit B.
1.2. Rent and SecurityDefined.
1.2.1. Rent. "Rent" shall mean and refer collectively to sums denominated
as either Base Rent as set forth in Section 3.1, Additional Rent as set forth in Section 7, or any
such other sums or charges otherwise payable by Tenant under the terms of this Lease. Landlord
will adjust Rent and Additional Rent from time-to-time as set forth in Sections 3 and 7. Failure
by Tenant to pay any sum denominated as Rent shall entitle Landlord to pursue any or all
remedies specified in this Lease as well as remedies specified in RCW Chapter 59.12 or
otherwise allowed by law.
1.2.2. Security. "Security" or "Security Deposit" shall mean EIGHT
THOUSAND THREE HUNDRED THIRTY-SEVEN AND 90/100 DOLLARS ($8,337.90).
The Port acknowledges that it currently holds a security deposit from Tenant under two existing
Leases at Pier 66 between the Port of Seattle and Columbia Hospitality, Inc. dated October 25,
2012 ("Current Leases"), in the amount of Eight Thousand Three Hundred Thirty-Seven And
90/100 Dollars ($8,337.90) and that the Port will, except to the extent is authorized to apply such
amount against any breach under the Current Leases, credit the amount of the security deposit it
currently holds on deposit against the Security obligation under this Lease.
1.2.3. Tenant's Pro Rata Share. It is agreed by the parties that, as of the date
of this lease, Tenant's pro rata share of Operating Costs for Suite 200 is 9.12% as of the date of
this Lease and Tenant's pro rata share of Operating Costs for Suite 210 is 1.15%,therefore,
Tenant's total "Pro Rata Share" shall mean 10.39%. In the event that a portion of the Building is
damaged or condemned or any other event occurs which alters the rentable area of the Premises
or the rentable area of the Building, Landlord may adjust Tenant's Pro Rata Share of the
Building to properly reflect the proportion of the rentable area of the Building (as altered by such
event) which is attributable to the rentable area of the Premises (as altered by such event).
1.3. Term.
1.3.1. Possession Date. "Possession Date" shall mean September 1, 2015.
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Columbia Hospitality, Inc.
Final Draft: August 7, 2015
1.3.2. Rent Commencement Date. "Rent Commencement Date" shall mean
November 1, 2015 or, to the extent delayed for causes beyond the reasonable control of the
Tenant, the substantial completion of the Tenant Improvements (as defined in Section 8.2
below), whichever is later.
1.3.3. Expiration Date. "Expiration Date" shall mean October 31, 2020.
1.4. Addresses for Notice. The initial addresses for purposes of giving any notices
required by this lease shall be:
For Landlord:
Port of Seattle
Attn: Lease Administration
2711 Alaskan Way
Seattle, WA 98121
For payments only, the following mailing address should be used:
Port of Seattle
P.O. Box 24507
Seattle, WA 98124-0507
For Tenant:
Columbia Hospitality, Inc.
Attn: John Oppenheimer
2100 Alaskan Way, Suite 200
Seattle, Washington 98121
Facsimile: (206) 239 1801
1.5. Premises. The Landlord leases to Tenant and Tenant leases from Landlord, upon
the terms and conditions herein set forth, the Premises, together with rights of ingress and egress
over Common Areas. Subject to the rights reserved to Landlord in this Lease, the Premises
extend to the centerline of party/demising walls and to the exterior faces of any exterior walls
and from the structural flooring to ceiling, specifically including any plenum above a
drop/suspended ceiling.
1.6. Acceptance of the Premises. Tenant has examined the Premises, accepts them in
their condition as of the Possession Date, and agrees to make any changes in the Premises
necessary to conform to federal, state and local law applicable to Tenant's use of the Premises.
Landlord represents and warrants that as of the Effective Date, to the best of Landlord's
knowledge the Building is free from hazardous waste or materials as defined in Section 21.1 of
this Lease and the Building is in compliance with all state and local building codes, including the
Americans with Disabilities Act.
1.7. Quiet Enjoyment. So long as Tenant is not in default under this Lease and subject
to the specific provisions, covenants and agreements contained in this Lease, Landlord covenants
and agrees that the quiet and peaceful possession and enjoyment of the Premises by Tenant shall
not be disturbed or interfered with by Landlord or by any other party claiming by or through
Landlord.
SECTION 2: TERM
2.1. Term. The initial term of this Lease is approximately five (5) years and two (2)
months ("Term"), commencing on the Possession Date and, unless earlier terminated pursuant to
any provision hereof, ending on the Expiration Date.
2.2. Termination of Current Leases at Pier 66. The Current Leases shall terminate at
midnight October 31, 2015; provided, however, to the extent the Tenant Improvements are
delayed for causes beyond the reasonable control of the Tenant, the termination date for the
Current Leases shall be extended until a date ten (10) days following the substantial completion
of the Tenant Improvements. To the extent the Current Leases are extended beyond October 31,
2015, Tenant shall continue to pay rent under the Current Lease until the Rent Commencement
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Columbia Hospitality, Inc.
Final Draft: August 7, 2015
Date hereunder (but not for the additional ten-day period following the Rent Commencement
Date, which is provided for Tenant to complete it relocation).
SECTION 3: RENT
3.1. Rent. Commencing on the Rent Commencement Date, Tenant agrees to pay as
rent ("Base Rent") for the Premises as follows:
Effective on the Rent Commencement Date through October 31, 2017:
Suite 200: 9,182 rsf Office Space @ $8,166.29/mo.
Suite 210: 798 rsf Office Space @ $897.75/mo.
Effective November 1, 2016 through October 31, 2017:
Suite 200: 9,182 rsf Office Space @ $8,370.44/mo.
Suite 210: 798 rsf Office Space @ $964.25/mo.
Effective November 1, 2017 through October 31, 2018:
Suite 200: 9,182 rsf Office Space @ $7,651.67/mo.
Suite 210: 798 rsf Office Space @ $1,030.75/mo.
Effective November 1, 2018 through October 31, 2019:
Suite 200: 9,182 rsf Office Space @ $8,416.83/mo.
Suite 210: 798 rsf Office Space @ $1,097.25/mo.
Effective November 1, 2019 through October 31, 2020:
Suite 200: 9,182 rsf Office Space @ $9,182.00/mo.
Suite 210: 798 rsf Office Space @ $1,163.75/mo.
From the Rent Commencement Date through October 31, 2017, the Base Rent for Suite 200
stated above shall be the gross amount payable by Tenant; Tenant shall not be subject to any
additional charges for standard building services provided by Landlord pursuant to Section 6.1,
but Tenant shall remain responsible for taxes payable pursuant to Section 7.5 and 7.6. From
November 1, 2017 through the end of the Term, Tenant shall also be responsible to Tenant's Pro
Rata Share of Operating Expenses under Section 7.1. The Base Rent shall constitute the contract
rent for purposes of determining taxable rent for assessment of leasehold excise tax.
From the Rent Commencement Date through the end of the Term, the Base Rent for Suite 210
stated above shall not be the gross amount payable by Tenant, but rather there shall also be an
additional charge for standard building services provided by Landlord pursuant to Section 6.1.
Tenant shall be responsible for its Pro Rata Share of Operating Expenses under Section 7.1,
together with taxes payable pursuant to Section 7.5 and 7.6, for the entire Term for Suite 210.
3.2. Payment of Base Rent. The Base Rent shall be paid to Landlord in advance on the
first day of each and every month during the term, at such place as Landlord may designate,
without any prior demand, and without any abatement, deduction or setoff whatsoever. The
initial address for payment is set forth in Section 1.4. If the term commences on any day other
than the first day of a calendar month, Base Rent for any fractional month shall be prorated based
upon the actual number of days in such fractional month.
3.3. Rent Abatement. As inducement to enter into this Lease and for as long as Tenant
is not in default beyond any applicable cure period provided in this Lease, Tenant's obligation to
pay Base Rent and Additional Rent for Suite 200 shall be abated for the period of November 1,
2015 through December 31, 2015 and Base Rent and Additional Rent for Suite 210 shall be
abated for the period of November 1, 2015 through March 31, 2016.
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3.4. Additional Rent. Commencing on the Rent Commencement Date (but subject to
Section 3.3) through October 31, 2017, in addition to the Base Rent as set forth in
Section 3.1,Tenant shall pay, as Additional Rent, its pro rata share as follows of the Operating
Costs (defined in Section 7.1) associated with Suite 210 only. Commencing on November 1,
2017 through the end of the Term, in addition to the Base Rent as set forth in Section 3.1,Tenant
shall pay, as Additional Rent, its pro rata share as follows of the Operating Costs (defined in
Section 7.1) associated with both Suite 200 and Suite 210.
3.4.1. Tenant's pro rata share of the Operating Costs attributable to Suite
200 and Suite 210 shall be as set forth in Section 1.2.3provided, however, if any space in the
Building is leased to a tenant who is separately responsible for paying the cost of a service that
would otherwise be included in Operating Costs, the rentable area of such tenant's space shall be
excluded from the rentable area of the Building for the purpose of determining Tenant's pro rata
share of the balance of the cost of such services and if any space in the building is leased to a
tenant who creates an exemption from real property taxes or any other category of Operating
Costs so as to reduce the Building's total cost of the same in proportion to that tenant's rentable
area, then the rentable area of such tenant's space shall be excluded from the rentable area of the
Building for the purpose of determining Tenant's percentage share of the real property tax or
other category of Operating Costs.
3.5. Late Charges.
3.5.1. Tenant hereby acknowledges that late payment by Tenant to Landlord
of Rent, or any portion thereof, or any other sums due hereunder will cause Landlord to incur
costs not otherwise contemplated by this Lease. Accordingly, if any installment of Rent, or any
portion thereof, or any other sum due from Tenant shall not be received by Landlord within ten
(10) days after such amount shall be due, then, without any requirement for notice to Tenant,
Tenant shall pay Landlord a late charge equal to 5% of such overdue amount. The parties agree
that such late charge represents a fair and reasonable estimate of the costs Landlord will incur by
reason of late payment by Tenant. Acceptance of such late charge by Landlord shall in no event
constitute a waiver of Tenant's default with respect to such overdue amount, nor prevent
Landlord from exercising any of the other rights and remedies granted hereunder.
3.5.2. In addition to the late charges provided for in this Section, interest
shall accrue on any unpaid Rent and/or other remuneration, or any other sums due hereunder, at
the rate of 18% per annum or the maximum rate provided by law, whichever is less, ("the
Default Rate") from the day after the date due until paid.
SECTION 4: SECURITY
4.1. Security. Subject to the right to apply the amount previously provided as set forth
in Section 1.2.2, Landlord acknowledges that Tenant has delivered to Landlord a security deposit
in the amount as set forth in Section 1.2.2, to secure Tenant's full performance of this Lease,
including the payment of all fees and other amounts now or hereafter payable to the Landlord
hereunder. The amount, form, provisions and nature of the Security, and the identity of the surety
or other obligor thereunder, shall at all times be subject to the Landlord's approval. The Security
shall remain in place at all times throughout the full term of this Lease and throughout any
holdover period. No interest shall be paid on the Security and the Landlord shall not be required
to keep the Security separate from its other accounts. No trust relationship is created with respect
to the Security.
4.2. Return of Security. The Security is a part of the consideration for execution of this
Lease. If Tenant shall have fully performed all terms and conditions of this Lease, any cash
deposit security shall be paid to Tenant within thirty (30) days following the termination (or
expiration) date without interest; otherwise the Landlord shall, in addition to any and all other
rights and remedies available under this Lease or at law or equity, retain title thereto.
4.3. Application of Security. The Landlord may apply all or part of the Security to
unpaid rent or any other unpaid sum due hereunder, or to cure other defaults of Tenant. If the
Landlord uses any part of the Security, Tenant shall restore the Security to its then-currently
required amount within fifteen (15) days after the receipt of the Landlord's written request to do
so. The retention or application of such Security by the Landlord pursuant to this subparagraph
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Columbia Hospitality, Inc.
Final Draft: August 7, 2015
does not constitute a limitation on or waiver of the Landlord's right to seek further remedy under
law or equity.
SECTION 5: USES
5.1. General Office Purposes. The Premises are to be used only for general office
purposes and for no other business or purpose without the prior written consent of Landlord,
which consent may be withheld by Landlord, in its sole discretion, if it determines that any
proposed use is inconsistent with other uses within the Building, is the sort of use that is
inappropriate for a building owned by a municipal corporation, is detrimental to the maintenance
and operation of the Building as a first-class office building or is inconsistent with any restriction
on use of the Building contained in any lease, mortgage, or other instrument or agreement by
which the Landlord is bound or to which the Building is subject prior to the Effective Date.
Landlord represents that there is no such restriction on use of the Building that restricts or is
likely to restrict Tenant's use and occupation of the Premises as described herein.
5.2. General Standards Regarding Use.
5.2.1. Tenant shall not use or occupy or permit the Premises or any part
thereof to be used or occupied, in whole or in part, in a manner which would in any way: (i)
materially violate any present or future Legal Requirements, (ii) materially violate any of the
covenants, agreements, provisions and conditions of this Lease, (iii) materially violate the
certificate of occupancy then in force with respect thereto, (iv) as will constitute a public or
private nuisance, or (v) impair, in Landlord's reasonable judgment, with the character, reputation
or appearance of the Building or Landlord, or (vi) occasion material discomfort, inconvenience
or annoyance to either the Landlord or adjoining tenants. For purposes of this Lease, the term
"Legal Requirements" shall mean and refer to all laws, statutes and ordinances including
building codes and zoning regulations and ordinances and the orders, rules, regulations and
requirements of all federal, state, county, city or other local jurisdiction departments, agencies,
bureaus, offices and other subdivisions thereof, or any official thereof, or of any other
governmental, public or quasi-public authority, which may be applicable to or have jurisdiction
over the Premises, or the sidewalks or streets adjacent thereto and all requirements, obligations
and conditions of all instruments of record on the date of this Lease.
5.2.2. Tenant shall not commit any act that will increase the then existing
cost of insurance on the Building without Landlord's prior written consent. In the event that
Tenant does, Tenant shall cease such act or, failing to do so, Tenant shall promptly pay upon
demand the amount of any increase in insurance costs caused solely by any act or acts of Tenant.
5.2.3. Tenant shall not, without the prior written consent of Landlord, use
any apparatus, machinery or device in or about the Premises which will cause any substantial
noise, vibration or fumes. Tenant shall not permit smoking in the Premises. Landlord has
designated all internal portions of the Building as a smoke-free zone. If any of Tenant's office
machines or equipment should disturb the quiet enjoyment of any other tenant in the Building,
then Tenant shall provide adequate insulation, or take any other action determined by Landlord
as may be necessary to eliminate the disturbance.
5.2.4. Tenant shall not place upon or install in windows or other openings or
exterior sides of doors or walls of the Premises or any part of the Premises visible from the
exterior of the Premises any signs, symbols, drapes or other materials, without the prior written
consent of Landlord.
5.2.5. Tenant shall observe all reasonable rules and regulations (not
inconsistent with the terms of this Lease) as may be adopted and made available to Tenant by
Landlord from time to time for the safety, care and cleanliness of the Premises or the Building,
and for the preservation of good order therein. A copy of the current Contractor's Rules and
Regulations and current Building Specific Rules and Regulations are attached hereto as
Exhibit C.
5.3. No Liens. Tenant will not directly or indirectly create or permit to be created
and/or to remain, a Lien upon this Lease, the Building or Premises, including any Tenant
Improvements or Alterations (as defined below in Sections 8.2 and 8.3, respectively), fixtures,
improvements or appurtenances thereto, except those Liens expressly permitted by in writing by
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Final Draft: August 7, 2015
Landlord. In the event any such Lien(s) have been created by or permitted by Tenant in violation
of this provision, Tenant shall immediately discharge as of record, by bond or as otherwise
allowed by law, any such Lien(s). Tenant shall also defend (with counsel approved by Landlord),
fully indemnify, and hold entirely free and harmless Landlord from any action, suit or
proceeding brought on or for the enforcement of such lien(s). As used in this Section, "Lien"
shall mean and refer to any mortgage, lien, security interest, encumbrance, charge on, pledge of,
conditional sale or other encumbrance on the Premises, any Alteration, fixture, improvement or
appurtenance thereto, or any larger building and/or property of which the Premises may be a
part.
5.4. Signs. Tenant shall not place or in any manner display any sign, graphics, or other
advertising matter anywhere in or about the Premises or the Building at places visible (either
directly or indirectly) from anywhere outside the Premises without first obtaining Landlord's
written consent thereto. 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 shall repair any damage to the Premises or the Building caused thereby. Landlord
shall not unreasonably withhold its consent to normal Tenant signage within the Premises which
is consistent in Landlord's opinion with the Building's image and signage and graphics program.
Signage approved by Landlord, other than the standard Building directory or elevator lobby
directory signage, is at Tenant's sole expense. Tenant shall provide Landlord the design and
plans for its signage prior to Possession Date. Landlord shall display three (3) names for Tenant
as well as location in the main Building lobby and Building directory.
SECTION 6: SERVICES AND UTILITIES
6.1. Standard Services. Landlord shall maintain the Premises and the public and
common areas of the Building in good order and condition consistent with the operation and
maintenance of a first-class office building in downtown Seattle, Washington. Landlord shall
also maintain, repair and replace all structural components of the Building, including, without
limitation, the foundations, bearing and exterior walls, subflooring, roof, unexposed electrical,
plumbing and sewage systems, and heating ventilation and air conditioning systems. Landlord
shall also maintain in good condition and repair, elevators, alarm monitoring, building systems,
including without limitation parking areas, lobbies, stairwells, restrooms and outdoor
landscaping. Landlord shall furnish the Premises with utilities and services for normal office use,
including the following: electricity; lighting and operation of low power usage office machines;
natural gas; water; passenger and freight elevator service; hot and cold water for drinking,
restroom and office cleaning purposes; sanitary sewer service; sprinkler riser monitoring;
heating, ventilation and air conditioning; local telephone service; and all other utility services
used in the Premises at all times during the Term of the Lease or any extension thereof. Landlord
shall also provide lamp replacement service for the Building's standard light fixtures, toilet room
supplies, window washing at reasonable intervals, and customary building janitorial service. No
janitorial service shall be provided for Saturdays, Sundays or legal holidays. The costs of any
janitorial or other service provided by Landlord to Tenant which are not provided under the
terms of this Lease and are not services ordinarily provided Building tenants shall be paid by
Tenant as Additional Rent upon receipt of billings. Landlord shall not be obligated to repair or
replace any fixtures or equipment installed by or for Tenant and Landlord shall not be obligated
to make any repair or replacement caused by any negligent or otherwise wrongful act or
omission of Tenant or of Tenant's employees, agents, invitees, or licensees.
6.2. Normal Business Hours. From 7:00 a.m. to 6:00 p.m. Monday through Friday
excluding legal holidays ("Normal Business Hours"), Landlord shall furnish to the Premises heat
and air conditioning. If requested by Tenant, Landlord shall furnish heat and air conditioning at
times other than Normal Business Hours and the cost of such services as reasonably estimated by
Landlord in advance and agreed by Tenant shall be paid by Tenant as Additional Rent. During
other than Normal Business Hours, 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 and during any extension thereof (24 hours of all days) reasonable access to the
Premises.
6.3. Interruption of Services. Landlord will not be liable for any loss, injury or damage
to person or property caused by or resulting from any variation, interruption, or failure of any
services or facilities provided by Landlord pursuant to this Lease due to any cause whatsoever,
except when such losses are the result of the gross negligence or intentional act of Landlord or its
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officers, employees, or agent. No temporary interruption or failure of such services or facilities
incident to the making of repairs, alterations, or improvements, or due to accident, strike or
conditions or events beyond Landlord's reasonable control will be deemed an eviction of Tenant
or relieve Tenant from any of Tenant's obligations. Landlord shall use all reasonable efforts in
good faith to promptly restore such services or facilities and minimize any disruption of Tenant's
use of the Premises arising from any interruption or failure of such services or facilities.
6.4. Additional Services. The Building mechanical system is designed to
accommodate heating loads generated by lights and equipment using up to 2.5 watts per square
foot. Before installing lights and equipment in the Premises which in the aggregate exceed such
amount, Tenant shall obtain the written permission of Landlord. Landlord may refuse to grant
such permission unless Tenant agrees to pay the Landlord's costs for installation of
supplementary air conditioning capacity or electrical systems as necessitated by such equipment
or lights. Notwithstanding the foregoing, Landlord acknowledges that the Premises currently
have a server room with supplemental HVAC system, and Tenant shall not be responsible, under
either this Section or Section 6.5, for the cost of any additional electricity or maintenance of
supplemental air conditioning units associated with such server room.
6.5. Costs of Additional Services. If Tenant installs supplemental lights and equipment
in the Premises pursuant to the terms of Section 6.4, Tenant shall in advance, on the first day of
each month during the Lease, pay Landlord as Additional Rent the reasonable amount estimated
by Landlord as the cost of furnishing electricity for the operation of such supplemental
equipment or lights and the reasonable amount estimated by Landlord as the costs of operation
and maintenance of supplementary air conditioning units necessitated by Tenant's use of such
equipment or lights. Landlord shall be entitled to install and operate at Tenant's cost a
monitoring/metering system in the Premises to measure the added demands on electricity,
heating, ventilation, and air conditioning systems resulting from such equipment or lights and
from Tenant's after-hours heating, ventilation and air conditioning service requirements. Tenant
shall comply with Landlord's reasonable instructions for the use of drapes, blinds and
thermostats in the Building.
SECTION 7: COSTS OF OPERATIONS AND TAXES
7.1. As used in this Lease, "Operating Costs" or "Costs" mean all actual expenses of
Landlord for maintaining, operating and repairing the Building and the personal property used in
connection therewith, including without limitation, insurance premiums and deductibles; taxes
and assessments such as real property taxes and taxes arising from inclusion of the Premises in
improvement districts as well as assessments by governments such as impact fees attributable to
the Premises; water, sewer and all other utility charges (other than utilities separately metered
and paid directly by Tenant or other tenants); janitorial and other cleaning services; refuse,
recycling and trash removal; pest control; lighting systems, fire detection and security services;
roof repairs and maintenance; landscape maintenance; patching, resurfacing and maintenance of
parking, sidewalks and driveway serving the Building; customary management fees (not
exceeding 5% of gross revenues); and other expenses which in accordance with generally
accepted accounting and management practices would be considered an expense of maintaining,
operating or repairing the Building ("Operating Costs" or "Costs"). Operating Costs, or Costs
shall exclude: (i) Leasehold excise tax or any other tax based on leasehold interest or contract
rent for the Premises, or based on activities conducted on the Premises or on Tenant's personal
property; (ii) Payments of principal and interest charges incurred on debt, or depreciation
expenses; (iii) Costs of any items for which Landlord is entitled to receive a reimbursement
from insurance proceeds, from a tenant or from any other third party; (iv) Legal fees and costs,
settlements, judgments and awards arising out of costs incurred in connection with the
negotiation or disputes with other tenants or potential tenant of the Building; (v) Costs of any
tenant improvements or special services rendered to individual tenants for which a separate
charge is made; (vi) Leasing commissions, and other leasing expenses; (vii) Reserves; and
(viii) Costs of improvements required to be capitalized in accordance with generally accepted
accounting principles, except Operating Costs shall include amortization of capital
improvements (A) made subsequent to initial development of the Building which are designed
with a reasonable probability of improving the operating efficiency of the Building, or providing
savings in the cost of operating the Building; or, (B) which are reasonably responsive to
requirements imposed with respect to the Building under any amendment to any applicable
building, health, safety, fire, nondiscrimination, or similar law or regulation ("law"), or any new
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Final Draft: August 7, 2015
law, or any new interpretation of an existing law ("new interpretation"), which amendment, law
or new interpretation is adopted or arose after the Possession Date of this Lease. For purposes of
this Lease, a new interpretation shall mean any interpretation, enforcement or application of a
law enacted prior to the Possession Date that imposes requirements with respect to the Building
that Landlord in the exercise of sound business judgment and good faith at the time of Landlord's
execution of this Lease would not have deemed applicable to the Building. If less than ninety
five percent (95%) of the rentable area of the Building is actually occupied during any year,
Operating Costs for that year shall be the amount that Operating Costs would have been for such
period had ninety five percent (95%) of the rentable area of Building been occupied during all
such year, as determined by the Port. Operating Costs are not intended to be part of contract rent;
different categories of operating costs charged to Tenant shall be separately stated on the invoice
billed to the Tenant.
7.2. As used in this Section, "Year" means the calendar year.
7.3. Prior to the commencement date of this Lease, and by each January 31st
thereafter, and at any other time the Port deems adjustment necessary, the Port shall submit to
Tenant a statement of the Tenant's anticipated pro rata share of Operating Costs through the
following December, and Tenant shall pay one-twelfth (1/12) thereof monthly, concurrent with
the payment of Rent. Within ninety (90) days after the end of each calendar year, the Port shall
give Tenant a statement showing the total actual costs for the prior calendar year and Tenant's
Pro Rata Share thereof. In the event that the total of the monthly payments which Tenant has
made for such calendar year is less than Tenant's actual pro rata share, Tenant shall pay the
difference within forty-five (45) days after receipt of such statement from the Port. Any
overpayment by Tenant shall be credited toward the Additional Rent next becoming due or, in
the event that the Lease has expired (and there is no outstanding default beyond the applicable
cure period), refunded to Tenant concurrently with the statement. Notwithstanding the above,
any delay or failure of the Port in computing or billing Additional Rent shall not constitute a
waiver of or in any way impair Tenant's obligation to pay the Base Rent, Additional Rent or any
other sum hereunder. In the event of any such delay or failure, Tenant shall continue paying the
Additional Rent currently being paid until notified by the Port of the adjustment.
7.4. Audit Rights; Records and Adjustments. Tenant, at its cost, shall have the right to
inspect during usual business hours, in the Port's offices or a local location designated by the
Port, the Port's records regarding the Operating Costs referred to in the annual statement. This
right to inspect shall extend for a period of ninety (90) days following delivery of the statement.
If within such sixty-day period neither party delivers notice to the other a notice referring in
reasonable detail to one or more errors in such statement or calculation, the information and
calculation in such statement shall conclusively be deemed correct.
7.5. Payment of Taxes. Tenant is liable for, and shall pay throughout the Term of this
Lease and any extension thereof, all license fees and all taxes payable for, or on account of, the
activities conducted by Tenant on the Premises; all taxes on the property of Tenant on the
Premises; any taxes on the Premises and/or on the leasehold interest created by this Lease; and
any tax levied on contract rent under this Lease. With respect to any such taxes payable by the
Port which are on or measured by the Rent payments hereunder, Tenant shall pay to the Port with
each Rent payment an amount equal to the tax on, or measured by, that particular payment. All
other tax amounts for which the Port is or will be entitled to reimbursement from Tenant shall be
payable by Tenant to the Port at least fifteen (15) days prior to the due dates of the respective tax
amounts involved; provided, that Tenant shall be entitled to a minimum of ten (10) days' written
notice of the amounts payable by it.
7.6. Personal Property Taxes. Tenant shall pay or cause to be paid, prior to
delinquency, any and all taxes and assessments levied upon all trade fixtures, inventories and
other property placed or installed in and upon the Premises by Tenant. If any such taxes on
Tenant's personal property or trade fixtures are levied against the Port or the Port's property, and
if the Port pays the taxes based upon such increased assessment, Tenant shall, upon demand,
repay to the Port the taxes so levied.
SECTION 8: CARE AND IMPROVEMENT OF PREMISES
8.1. General Obligations. Landlord shall perform all normal maintenance and repairs
reasonably determined by Landlord as necessary to maintain the Premises and the Building as a
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first-class office building; provided that Landlord shall not be required to maintain or repair any
property of Tenant or any appliances (such as refrigerators, water heaters, microwave ovens and
the like), which are part of the Premises. Tenant shall take good care of the Premises and at all
times keep the Premises neat, clean, in a safe and sanitary condition and free from pests.
8.2. Tenant Improvements. As of the Possession Date, Tenant accepts the Premises in
an as-is condition and may enter the Premises to make certain tenant improvements (the "Tenant
Improvements") as provided on Exhibit D.
8.3. Alterations. After the completion of the initial Tenant Improvements (if any),
Tenant shall not make any alterations, additions, substitutions or improvements ("Alterations")
in or to the Premises, or make changes to locks on doors, or add, disturb or in any way change
any plumbing or wiring ("Changes") without first obtaining the written consent of Landlord, and,
where applicable, in accordance with plans and specifications reasonably approved by Landlord.
As a condition to its approval, Landlord in its sole discretion may require Tenant to remove such
Alterations or Changes upon the expiration or earlier termination of the Term and any extension
period thereof, and to restore the Premises to the condition they were in prior to such Alterations
or Changes, including restoring any damage resulting from such removal, all at Tenant's
expense, but excepting reasonable use and wear and tear. Any Alterations or Changes, but
excluding Tenant Improvements, approved by Landlord and not required to be removed upon the
expiration or earlier termination of the Lease shall become a part of the realty and become
property of the Landlord upon the expiration or earlier termination of this Lease. Any Alterations
or Changes required to be made to Tenant's Premises by any amendment to any applicable
building, health, safety, fire, nondiscrimination, or similar law or regulation ("law"), or any new
law shall be made at Tenant's sole expense and shall be subject to the prior written consent of
Landlord. Except with respect to the initial Tenant Improvements, Tenant shall reimburse
Landlord for any reasonable sums expended for examination and approval of the architectural
and mechanical plans and specifications of the Alterations and Changes and direct costs
reasonably incurred during any inspection or supervision of the Alterations or Changes. All
damage or injury done to the Premises or Building by Tenant or by Tenant's officers, directors,
employees, agents, contractors, and invitees, including but not limited to the cracking or
breaking of any glass of windows and doors, shall be paid for by Tenant.
SECTION 9: TELECOMMUNICATIONS LINES AND EQUIPMENT
9.1. Location of Tenant's Equipment and Landlord Consent.
9.1.1. Tenant may install, maintain, replace, remove and use
communications or computer wires, cables and related devices (collectively, the "Lines") at the
Building in or serving the Premises; provided that any such installation of Lines that may affect
the structural integrity of the Building, interfere with other tenants of the Building, or may be
located outside of established or permitted conduit, cable trays, and risers shall be completed
only with Landlord's prior written consent, which consent may be withheld in Landlord's sole
and absolute discretion. In no event shall Landlord prohibit Tenant from installing in the
Building computer network cabling; however, Landlord may limit the location and amount of
such computer network cabling through the approval of Tenant's Preliminary Plans and Working
Drawings (if any) pursuant to Section 8.28.2 and Exhibit D and any subsequent Alterations or
Changes, pursuant to Section 8.3. Tenant shall locate all electronic telecommunications
equipment within the Premises and shall relocate all Tenant's equipment which is located within
the Building telephone closets or riser spaces, at Tenant's cost, to the Tenant's Premises. Any
request for Landlord's consent shall contain detailed plans, drawings and specifications
identifying all work to be performed, the time schedule for completion of the work, the identity
of the entity that will provide service to the Lines and the identity of the entity that will perform
the proposed work (which entity shall be subject to Landlord's approval). Landlord shall have a
reasonable period of time in which to evaluate the request after it is submitted by Tenant, except
that Lines proposed as part of the initial Tenant's Preliminary Plans and Working Drawings
described in Section 8.2 and Exhibit D of this Lease shall be subject to the review procedure set
forth in Section 8.2 and Exhibit D.
9.1.2. Landlord's approval of, or requirements concerning, the Lines or any
equipment related thereto, the plans, specifications or designs related thereto, the contractor or
subcontractor, or the work performed hereunder, shall not be deemed a warranty as to the
adequacy thereof, and Landlord hereby disclaims any responsibility or liability for the same.
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Landlord disclaims all responsibility for the condition or utility of the intra-building network
cabling ("INC") and makes no representation regarding the suitability of the INC for Tenant's
intended use.
9.1.3. If Landlord consents to Tenant's proposal, Tenant shall (a) pay all
costs in connection therewith (including all costs related to new Lines); (b) comply with all
requirements and conditions of this Section; and (c) use, maintain and operate the Lines and
related equipment in accordance with and subject to all laws governing the Lines and equipment.
Tenant shall further insure that (i) Tenant's contractor complies with the provisions of this
Section and Landlord's reasonable requirements governing any work performed; (ii) Tenant's
contractor provides all insurance required by Landlord; (iii) any work performed shall comply
with all federal, state and local laws and regulations; and (iv) as soon as the work in completed,
Tenant shall submit "as-built" drawings to Landlord, as soon as available.
9.1.4. Landlord reserves the right to require that Tenant remove any Lines
located in or serving the Premises which are installed in violation of these provisions, or which
are at any time in violation of any laws or present a dangerous or potentially dangerous condition
(whether such Lines were installed by Tenant or any other party), within three (3) days after
written notice. Tenant shall remove any Lines located in or serving the Premises promptly upon
expiration or sooner termination of this Lease.
9.1.5. Notwithstanding anything in this Section 9 to the contrary, Lines shall
not include basic telephone wiring and cabling.
9.2. Landlord's Rights. Landlord may (but shall not have the obligation to):
9.2.1. Install new Lines at the Building;
9.2.2. Create additional space for Lines at the Building; and
9.2.3. Direct, monitor and/or supervise the installation, maintenance,
replacement and removal of, the allocation and periodic re-allocation of available space (if any)
for, and the allocation of excess capacity (if any) on, any Lines now or hereafter installed at the
Building by Landlord, Tenant or any other party (but Landlord shall have no right to monitor or
control the information transmitted through such Lines).
9.3. Indemnification. In addition to any other indemnification obligations under this
Lease, Tenant shall indemnify and hold harmless Landlord and its employees, agents, officers,
and contractors from and against any and all claims, demands, penalties, fines, liabilities,
settlements, damages, costs or expenses (including reasonable attorneys' fees) arising out of or in
any way related to the acts and omissions of Tenant, Tenant's officers, directors, employees,
agents, contractors, subcontractors, subtenants, and invitees with respect to: (i) Tenant's
installation, maintenance, use or removal of any Lines serving Tenant or equipment related
thereto serving Tenant in the Building; (ii) any personal injury (including wrongful death) or
property damage arising out of or related to any Lines serving Tenant or equipment related
thereto serving Tenant in the Building to the extent arising from the negligence or willful
misconduct of the Tenant or Tenant's officers, directors, employees, agents, contractors,
subcontractors, subtenants, and invitees; and (iii) any violations of federal, state or local laws and
regulations or demands of governmental authorities, or any reasonable written policies or
requirement of Landlord, which are based upon or in any way related to Tenant's installation,
maintenance, use or removal of any Lines or equipment. This indemnification and hold harmless
agreement shall survive the termination of this Lease.
9.4. Limitation of Liability. Landlord shall have no liability for damages arising from,
and Landlord does not warrant that the Tenant's use of any Lines will be free from the following
(collectively called "Line Problems"): (i) any shortages, failures, variations, interruptions,
disconnections, loss or damage caused by the installation, maintenance, or replacement, use or
removal of Lines by or for other tenants or occupants at the Building, by any failure of the
environmental conditions or the power supply for the Building to conform to any requirement of
the Lines or any associated equipment, or any other problems associated with any Lines by any
other cause; (ii) any failure of any Lines to satisfy Tenant's requirements; or (iii) any
eavesdropping or wire-tapping by unauthorized parties. Landlord in no event shall be liable for
damages by reason of loss of profits, business interruption or other consequential damage arising
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from any Line Problems. Under no circumstances shall any Line Problems be deemed an actual
or constructive eviction of Tenant, render Landlord liable to Tenant for abatement of Rent, or
relieve Tenant from performance of Tenant's obligations under this Lease.
9.5. Electromagnetic Fields. If Tenant at any time uses any equipment that may create
an electromagnetic field exceeding the normal insulation ratings of ordinary twisted pair riser
cable or cause radiation higher than normal background radiation, Landlord reserves the right to
require Tenant to appropriately insulate the Lines therefore (including riser cables) to prevent
such excessive electromagnetic fields or radiation.
SECTION 10: COMMON AREAS
10.1. Common Areas. "Common Areas" means those parts of the Building and the land
upon which it is located outside the Premises that are provided and designated by Landlord from
time to time for the general use and convenience of Tenant and of other tenants of the Building
and their respective authorized representatives, guests and invitees. Common Areas may include,
without limitation, designated pedestrian walkways, plazas and sky bridges, landscaped areas,
public lobbies, elevators, sidewalks, loading areas, parking areas, service corridors, central
business systems, restrooms, stairways, and arcades.
10.2. Control of Common Areas by Port. Landlord shall at all times have the exclusive
control and management of the Common Areas. Without limiting Landlord's right of control and
management, Landlord specifically reserves the right to: (i) establish, modify from time to time,
and enforce reasonable rules and regulations governing the use of the Common Areas, as long as
such rules and regulations do not materially increase Tenant's obligations or reduce Tenant's
rights under this Lease; (ii) police the Common Areas; (iii) change the area, level, location and
arrangement of areas or facilities within the Common Areas; (iv) provided Tenant is not deprived
of reasonable access to its Premises, close all or any portion of the Common Areas; and (v) do
and perform such other acts in and to the Common Areas as, in the use of good business
judgment, Landlord shall determine to be advisable with a view to the improvement of the
convenience and use thereof by Landlord and tenants of any larger property of which the
Premises are a part. Landlord shall reasonably coordinate with Tenant the timing of changes to
the Common Area in order to minimize any disruption to Tenant's business operations.
10.3. Parking. Parking is available at the Bell Street Pier Garage at prevailing monthly
rates on an unassigned, self-park basis. Twenty (20) parking spaces (one [1] per 500 square feet
of rentable space) will be available to Tenant in the Bell Street Pier Garage, however Tenant
shall be responsible for arranging the terms and conditions for such for parking directly with the
third-party operator of the Bell Street Pier Garage. Additional parking spaces will be available to
Tenant on a space-available basis and pursuant to the terms and conditions established by the
third-party operator of the Bell Street Pier Garage. Tenant's use of parking in the Bell Street
Parking Garage is subject to all rules and regulations of Landlord or of the parking garage
operator, and the ordinances, rules, regulations and permit conditions of the City of Seattle,
Washington, which may be published from time to time. Short-term hourly parking will be
available on a space-available basis during Normal Business Hours (as defined in Section 6.2)
except Saturdays, and except Sundays or legal holidays, for Tenant's clients and customers.
10.4. Outside Areas and Roof. The use of the outside area of the walls (other than the
front of the Premises) and the roof of the building in which the Premises are located is reserved
to Landlord, which shall have the right to utilize the same for any purpose, including the
maintenance of signs.
10.5. License. Tenant is hereby licensed to use and occupy all Common Areas,
including reasonable means of ingress to and egress from the Premises, under a revocable license
for the duration of the Term. If the amount of such areas or facilities is revised or diminished,
such revision or diminution shall not be deemed a constructive or actual eviction, and Landlord
shall not be subject to any liability, nor shall Tenant be entitled to any compensation or reduction
or abatement of Rent.
SECTION 11: INDEMNIFICATION
11.1. Landlord Not Liable Unless Negligent. The Landlord, its employees and agents
shall not be liable for any injury (including death) to any persons or for damage to any property
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regardless of how such injury or damage be caused, sustained or alleged to have been sustained
by Tenant or by others, including but not limited to all persons directly or indirectly employed by
the Tenant, its employees, agents, contractors, subcontractors, licensees, or invitees as a result of
any condition (including existing or future defects in the Premises) or occurrence (including
failure or interruption of utility service) whatsoever related to the condition of the Premises, or
related in any way to Tenant's use or occupancy of the Premises, except to the extent caused by
the negligence or willful misconduct of Landlord, its employees, agents and contractors. Tenant
agrees to defend (with counsel approved by Landlord) and to hold and save the Landlord
harmless from all liability or expenses incurred by Landlord (including attorneys' fees, costs, and
all expenses of litigation) in connection with any such items of actual or alleged injury or
damage, except when such injury or damage is caused by the negligence or willful misconduct of
the Landlord, its employees, agents and contractors.
11.2. Industrial Immunity. In consideration of the execution of this Lease, Landlord and
Tenant hereby waive any immunity the waiving party may have under applicable workers'
compensation benefit or disability laws, (including but not limited to Title 51 RCW) in
connection with the foregoing indemnity. Such waiver shall not prevent Landlord or Tenant from
asserting such immunity against any other persons or entities. Tenant and Landlord agree and
acknowledge that this provision is the product of mutual negotiation.
SECTION 12: INSURANCE
12.1. Required Policies. Tenant shall obtain and keep in force throughout the Term of
the Lease, at its sole cost and expense the following types of insurance, in the amounts specified
and in the form hereinafter provided for:
12.1.1. General Liability Insurance. Tenant shall obtain and keep in force a
commercial general liability policy of insurance, written on ISO Form CG 00 01 10 01 (or
equivalent). Landlord shall be added to the policy as an additional insured for ongoing and
completed operations using ISO Form 20 26 (either 11 85 or 07 04 revision) or equivalent,
against claims for bodily injury, personal injury and property damage based upon, involving or
arising out of the tenancy, use, occupancy or maintenance of the Premises and all areas
appurtenant thereto, and specifically including the action/inaction of any subtenant, licensee or
concessionaire. Such insurance shall be on an occurrence basis providing single limit coverage in
an amount not less than one million dollars ($1,000,000) per occurrence. The policy shall not
contain any intra-insured exclusions as between insured persons or organizations. The policy
shall contain a minimum $250,000 sub-limit that covers damage to premises rented or leased to
Tenant, including fire damage. This limit shall be identified on the Certificate of Insurance.
12.1.2. Automobile Liability Insurance. Tenant shall obtain and keep in force
a commercial automobile liability policy of insurance, written on ISO Form CA 00 01 07 97 (or
equivalent), that protects Tenant and Landlord against claims for bodily injury and property
damage based upon, involving or arising out of motor vehicle operations on or about the
Premises and all areas appurtenant thereto. Tenant shall provide a Waiver of Subrogation on this
policy in favor of Landlord. Such insurance shall cover any "Auto" (i.e. owned, hired and nonowned
) and shall be on an occurrence basis providing single limit coverage in an amount not less
than one million dollars ($1,000,000) per occurrence. The policy shall not contain any intrainsured
exclusions as between insured persons or organizations.
12.1.3. Property Insurance. Tenant shall obtain and keep in force "Special
Extended" or "all risk" property insurance insuring loss or damage to Tenant's personal property
on or about the Premises and any Tenant Improvements and Alterations (specifically including
"betterments" and "improvements") made by or for Tenant to the Premises. The policy shall
include coverage for any additional costs resulting from debris removal and reasonable amounts
of coverage for the enforcement of any ordinance or law regulating the reconstruction or
replacement of the Premises including any undamaged sections of the Premises required to be
demolished or removed by reason of the enforcement of any Legal Requirement as the result of a
covered cause of loss. The amount of such insurance shall be equal to the full replacement cost
Tenant's personal property on or about the Premises and any Alterations. Tenant and Landlord
shall release each other and others working on behalf of such other party from any and all
liability to such party or anyone claiming through such party by way of subrogation or otherwise,
for any loss or damage to such property caused by fire or other casualty, even if such fire or other
casualty shall have been caused by the fault or negligence of the other party, or others working
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on behalf of the other party. This provision shall be applicable and in full force and effect only
with respect to loss or damage occurring during this Lease and the Tenant's occupancy and use
of the Premises during the Lease.
12.1.4. Other Insurance. Tenant shall further obtain and keep in force such
other and further insurance as Landlord may from time to time reasonably request for the
protection by insurance of its interest in the premises.
12.1.5. Limits. The limits of insurance specified in this Section shall be
subject to periodic adjustment to reflect changes in insuring practices for similar properties in the
same geographic area and changes in insurance products, but not more frequently than once a
year.
12.2. Insurance Policies.
12.2.1. Insurance Companies. Insurance required hereunder shall be in
companies duly licensed to transact business in the State of Washington, and maintaining during
the policy term a General Policyholders Rating of 'A-' or better and a financial rating of 'IX' or
better, as set forth in the most current issue of "Best's Insurance Guide."
12.2.2. Deductibles. Tenant is fully responsible for all insurance deductibles
and self-insured retentions. All insurance to be carried by Tenant shall be primary to and not
contributory with any similar insurance carried by Landlord, whose insurance shall be
considered excess insurance only. No insurance required herein shall contain a deductible or selfinsured
retention in excess of $100,000 without the prior written consent of Landlord.
12.2.3. Termination; Renewal. No policy of insurance required under this
Lease shall be cancelable or subject to non-renewal or modification except after thirty (30) days
prior written notice to Landlord except after 10 days prior written notice to Landlord in the case
of non-payment of premium by Tenant. Tenant shall at least thirty (30) days prior to the
expiration of such policies, furnish Landlord with evidence of renewals including additional
insured endorsements and certificates of insurance evidencing renewal.
12.2.4. Evidence of Insurance. Tenant shall deliver, or cause to be delivered,
to Landlord, certificates of insurance, additional insured endorsements, and any other
documentation or endorsement that provides evidence of the existence and amounts of such
insurance, the inclusion of Landlord as an insured as required by this Lease, and the amounts of
all deductibles and/or self insured retentions. Upon written request by Landlord, Tenant shall
deliver or cause to be delivered to Landlord, copies of the policies of insurance that Tenant has
purchased in order for Landlord to verify insurance coverage, limits, and endorsements or view
any exclusions to the Tenant's insurance policies.
12.2.5. No Limitation of Liability. The limits of insurance required by this
Lease or as carried by Tenant shall not limit the liability of Tenant nor relieve Tenant of any
obligation hereunder.
12.3. Waiver of Subrogation. Without affecting any other rights or remedies, Landlord
and Tenant (for itself and on behalf of anyone claiming through or under it by way of
subrogation or otherwise) hereby waives any rights it may have against the other, its officers,
agents and employees (whether in contract or in tort) on account of any loss or damage
occasioned to waiving party arising out of or incident to the perils (a) required to be insured
against under this Lease or (b) insured against under policies otherwise carried by either party.
Accordingly, Landlord and Tenant shall each cause each insurance policy required by this
Section 12 other otherwise carried by such party to further contain a waiver of subrogation
clause. The effect of such release and waiver of the right to recover damages shall not be limited
by the amount of insurance carried or required, or by any deductibles applicable thereto.
12.4. Increase in Landlord's Cost of Insurance. Tenant shall not use the Premises in
such a manner as to increase the existing rates of insurance applicable to the buildings or
structures of which the Premises are a part. If it nevertheless does so, then, at the option of
Landlord, the full amount of any resulting increase in premiums paid by Landlord with respect to
the buildings or structures of which the Premises are a part, and to the extent allocable to the
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term of this Lease, may be added to the amount of Rent and shall be paid by Tenant to Landlord
upon the monthly rental day next thereafter occurring.
SECTION 13: DAMAGE OR DESTRUCTION
13.1. Damage and Repair. If the Building is damaged by fire or any other cause to such
extent that the cost of restoration, as reasonably 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, or if the Building cannot be fully restored within 180 days of the
casualty event, then Landlord or Tenant may no later than sixty (60) days following the damage,
give the other party a notice of election to terminate this Lease. In the event of such election, this
Lease shall be deemed to terminate on the third day after the giving of said notice, and Tenant
shall surrender possession of the Premises within a reasonable time thereafter, and the Rent and
Additional Rent shall be apportioned as of the date of said surrender and any Rent and
Additional Rent paid for any period beyond such date shall be repaid to Tenant. If the cost of
restoration as estimated by Landlord shall amount to less than thirty percent (30%) of said
replacement value of the Building, the Building can be fully restored within 180 days of the date
of the casualty event, and insurance proceeds plus Landlord's deductibles and retention are
sufficient for restoration, Landlord shall restore the Building and the Premises to the extent of the
improvements to the Premises originally provided by Landlord or if Landlord does not elect to
terminate this Lease 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 herein provided. To the extent that the Premises are rendered
untenantable, the Rent and Additional Rent shall proportionately abate, except to the extent that
such damage resulted from the act, fault or neglect of Tenant, Tenant's officers, contractors,
agents, employees, clients, customers, or licensees, in which event Rent and Additional Rent
shall abate only to the extent Landlord receives proceeds from any rental income insurance
policy to compensate Landlord for such loss. Except for the abatement of Rent and Additional
Rent, no damages, compensation or claim shall be payable by Landlord for inconvenience, loss
of business or annoyance arising from any repair or restoration of any portion of the Premises or
of the Building. Landlord shall use all reasonable efforts to affect such repairs promptly.
13.2. Destruction During Last Year of Term. In case the Building is substantially
destroyed by fire or other cause at any time during the last twelve months of the Term of this
Lease or during the last twelve months of any extension thereof, either Landlord or Tenant may
terminate this Lease upon written notice to the other party given within sixty (60) days of the
date of such destruction.
13.3. Tenant Improvements. Except to the extent the Tenant Improvements, Alterations,
or Changes are or will become Landlord's property, Landlord will not carry insurance of any
kind on any Tenant Improvements, Alterations or Changes paid for by Tenant or on Tenant's
furniture or furnishings or on any fixtures, equipment, improvements or appurtenances of Tenant
under this Lease and Landlord shall not be obligated to repair any damage thereto or replace the
same.
SECTION 14: ASSIGNMENT AND SUBLETTING
14.1. Prohibition. Tenant shall not, in whole or in part, assign, sublet, license or permit
occupancy by any party other than Tenant of all or any part of the Premises, without the prior
written consent of Landlord in each instance; provided, however, that Tenant shall have the right
to assign Tenant's interest in the Lease or to sublease all or a portion of the Premises to (i) an
entity owned, controlled or under common control with Tenant; (ii) an entity in which Tenant is
merged or consolidated; (iii) a person or entity purchasing all of the stock or substantially all of
the assets of Tenant; or (iv) any one (1) single sublease to of less than ten percent (10%) of the
Premises (each, a "Permitted Transferee") with prior written notice to Landlord but without the
requirement of Landlord consent but otherwise subject to the requirements of Section 14.1.1
through 14.1.4. Tenant shall at the time the Tenant requests the consent of Landlord, deliver to
Landlord such information in writing as Landlord may reasonably require respecting the
proposed assignee, subtenant or licensee including, without limitation, the name, address, nature
of business, ownership, financial responsibility and standing of such proposed assignee,
subtenant or licensee. Within twenty (20) business days after receipt of all required information,
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Landlord shall, in its sole discretion, elect one of the following: (a) to consent to such proposed
assignment, sublease or license or (b) to refuse such consent.
14.1.1. As a condition for Landlord's consent to any assignment,
encumbrance or sublease, Landlord may require that the assignee, sublessee or licensee remit
directly to Landlord on a monthly basis, all monies due to Tenant by said assignee, sublessee or
licensee (except with respect to excess rentals otherwise due Tenant pursuant to Section 14.2). In
addition, a condition to Landlord's consent to any assignment, sublease or license of this Lease
or the Premises shall be the delivery to Landlord of a true copy of the fully executed instrument
of assignment, sublease or license and an agreement executed by the assignee, sublessee or
licensee in form and substance satisfactory to Landlord and expressly enforceable by Landlord,
whereby the assignee, sublessee or licensee assumes and agrees to be bound by the terms and
provisions of this Lease and perform all the obligations of Tenant hereunder.
14.1.2. In the event of any assignment, Tenant and each respective assignor,
waives notice of default by the tenant in possession in the payment and performance of the Rent,
covenants and conditions of this Lease and consents that Landlord may in each and every
instance deal with the tenant in possession, grant extensions of time, waive performance of any
of the terms, covenants and conditions of this Lease and modify the same, and in general deal
with the tenant then in possession without notice to or consent of any assignor, including Tenant;
and any and all extensions of time, indulgences, dealings, modifications or waivers shall be
deemed to be made with the consent of Tenant and of each respective assignor.
14.1.3. Tenant agrees that any sublease or license will contain a provision in
substance that if there be any termination whatsoever of this Lease then the subtenant or licensee,
at the request of Landlord, will attorn to Landlord and the sublessee or licensee, if Landlord so
requests, shall continue in effect with Landlord, but Landlord shall be bound to the subtenant or
licensee in such circumstances only by privity of estate. Nothing herein shall be deemed to
require Landlord to accept such attornment.
14.1.4. No assignment, subletting or license by Tenant shall relieve Tenant of
any obligation under this Lease, including Tenant's obligation to pay Rent or any other sum
hereunder. Any purported assignment, subletting or license contrary to the provisions hereof
without consent shall be void. The consent by Landlord to any assignment or subletting shall not
constitute a waiver of the necessity for such consent to any subsequent assignment or subletting.
14.1.5. Tenant shall reimburse Landlord in the sum of FIVE HUNDRED
DOLLARS ($500.00) plus any reasonable professionals' fees and expenses incurred by Landlord
in connection with any request by Tenant for consent to an assignment, subletting or license.
14.2. Excess Rental. If in connection with any assignment, sublease or license, Tenant
receives rent or other monetary consideration, either initially or over the term of the assignment
or sublease, in excess of the Rent called for hereunder, or in case of the sublease of a portion of
the Premises, in excess of such Rent fairly allocable to such portion, after appropriate
adjustments to assure that all other payments called for hereunder and out-of-pocket
expenditures, operating costs or concessions incurred by Tenant in connection with such
assignment, sublease or license, are appropriately taken into account, Tenant shall pay to
Landlord, as Additional Rent hereunder, fifty percent (50%) of the excess of each such payment
of rent or other consideration received by Tenant after its receipt.
14.3. Scope. The prohibition against assigning or subletting contained in this Section 14
shall be construed to include a prohibition against any assignment or subletting by operation of
law. If this Lease be assigned, or if the underlying beneficial interest of Tenant is transferred to a
person or entity other than a Permitted Transferee, or if the Premises or any part thereof be sublet
or occupied by anybody other than Tenant or a Permitted Transferee, Landlord may collect Rent
from the assignee, subtenant or occupant and apply the net amount collected to the Rent herein
reserved and apportion any excess Rent so collected in accordance with the terms of
Section 14.2, but no such assignment, subletting, occupancy or collection shall be deemed a
waiver of this covenant, or the acceptance of the assignee, subtenant or occupant as tenant, or a
release of Tenant from the further performance by Tenant of covenants on the part of Tenant
herein contained. No assignment or subletting shall affect the continuing primary liability of
Tenant (which, following assignment, shall be joint and several with the assignee), and Tenant
shall not be released from performing any of the terms, covenants and conditions of this Lease.
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SECTION 15: DEFAULTS AND REMEDIES
15.1. Defaults. The occurrence of any one or more of the following events constitutes a
default of this Lease by Tenant with or without notice from the Landlord:
15.1.1. The vacating or abandonment of the Premises by Tenant.
15.1.2. The failure by Tenant to make any payment of Rent, or any other
payment required by this Lease, when due and such failure continues for a period of five (5) days
after Tenant's receipt of Landlord's notice in writing of such failure; provided, however, that
Landlord shall not be required to give more than two (2) such notices in any twelve (12) month
period, after which Tenant shall be in default if it fails to make any payment within five (5) days
of the date when due.
15.1.3. The failure by Tenant to observe or perform any covenant, condition,
or agreement to be observed or performed by Tenant in this Lease other than the payment of
sums due hereunder, where such failure shall continue within thirty (30) days after Tenant's
receipt of Landlord's written notice thereof; provided that if the nature of Tenant's default is
such that it cannot reasonably be cured within thirty (30) days, Tenant shall not be deemed to be
in default if Tenant commences such cure within such thirty (30) day period and thereafter
diligently pursues such cure to completion..
15.1.4. The filing by Tenant of a petition in bankruptcy, Tenant being
adjudged bankrupt or insolvent by any court, a receiver of the property of Tenant being
appointed in any proceeding brought by or against Tenant, Tenant making an assignment for the
benefit of creditors, or any proceeding being commenced to foreclose any mortgage or other lien
on Tenant's interest in the Premises or on any personal property kept or maintained on the
Premises by Tenant, which proceeding is not dismissed within sixty (60) days of its having been
filed.
15.2. Remedies.
15.2.1. Whenever Tenant is in default under the terms of the Lease, having
failed to cure the event within the time, if any, provided in Section 15.1, this Lease and all of
Tenant's rights under it will automatically terminate if the written notice of default or any
separate notice from the Port so provides. Upon termination, the Landlord may reenter the
Premises using such force as may be necessary and remove all persons and property from the
Premises. The Landlord will be entitled to recover from Tenant all unpaid Rent or other
payments and damages incurred because of Tenant's default including, but not limited to, the
costs of re-letting, including tenant improvements, necessary renovations or repairs, advertising,
leasing commissions, and attorney's fees and costs ("Termination Damages"), together with
interest on all Termination Damages at the rate of 18% per annum, or the maximum rate
permitted by applicable law, whichever is less, from the date such Termination Damages are
incurred by the Landlord until paid.
15.2.2. In addition to Termination Damages, and notwithstanding termination
and reentry, Tenant's liability for all Rent or other charges which, but for termination of the
Lease, would have become due over the remainder of the Lease Term or any extension thereof
("Future Charges") will not be extinguished and Tenant agrees that the Landlord will be entitled,
upon termination for default, to collect as additional damages, a Rental Deficiency. "Rental
Deficiency" means, at the Landlord's election, either:
15.2.2.1. An amount equal to Future Charges, less the amount of
actual rent, if any, which the Landlord receives during the remainder of the Lease term from
others to whom the Premises may be rented, in which case such Rental Deficiency will be
computed and payable at the Landlord's option either:
15.2.2.1.1 In an accelerated lump-sum payment if the Premises
have been relet for the entire remaining Term of this Lease; or
15.2.2.1.2 In monthly installments, in advance, on the first day of
each calendar month following termination of the Lease and continuing until the date on which
the Lease would have expired but for such termination, and any suit or action brought to collect
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any portion of Rental Deficiency attributable to any particular month or months, shall not in any
manner prejudice the Landlord's right to collect any portion of Rental Deficiency by a similar
proceeding; or
15.2.2.2. An amount equal to Future Charges less the aggregate fair
rental value of the Premises over the remaining term of the Lease, reduced to present worth. In
this case, the Rental Deficiency must be paid to the Landlord in one lump sum, on demand, and
will bear interest at a rate of 18% per annum, or the maximum rate permitted by applicable law,
whichever is less, until paid. For purposes of this subsection, "present worth" is computed by
applying a discount rate equal to one percentage point above the discount rate then in effect at
the Federal Reserve Bank in, or closest to, Seattle, Washington.
15.2.3. If this Lease is terminated for default as provided in this Lease, the
Landlord shall use reasonable efforts to re-let the Premises in whole or in part, alone or together
with other premises, for such term or terms (which may be greater or less than the period which
otherwise would have constituted the balance of the term of the Lease), for such use or uses and,
otherwise on such terms and conditions as the Landlord, in its sole discretion, may determine,
but the Landlord will not be liable for, nor will Tenant's obligations under this Lease be
diminished by reason for any failure by the Landlord to re-let the Premises (unless due to failure
to use reasonable efforts to do so) or any failures by the Landlord to collect any rent due upon
such re-letting.
15.2.4. If upon any reentry permitted under this Lease, there remains any
personal property upon the Premises, the Landlord, in its sole discretion, may remove and store
the personal property for the account and at the expense of Tenant. In the event the Landlord
chooses to remove and store such property, it shall take reasonable steps to notify Tenant of the
Landlord's action. All risks associated with removal and storage shall be Tenant's responsibility.
Tenant shall reimburse the Landlord for all expenses incurred in connection with removal and
storage as a condition to regaining possession of the personal property. The Landlord has the
right to sell any property which has been stored for a period of 30 days or more, unless Tenant
has tendered reimbursement to the Landlord for all expenses incurred in removal and storage.
The proceeds of sale will be applied first to the costs of sale (including reasonable attorneys'
fees), second to the payment of storage charges, and third to the payment of any other amounts
which may then be due and owing from Tenant to the Landlord. The balance of sale proceeds, if
any, will then be paid to Tenant.
15.2.5. The Landlord's action pursuant to this remedies section shall not be
construed to limit the Landlord in the exercise of any other additional right or remedy which may
be available to the Landlord, at law or in equity, by reason of Tenant's default.
SECTION 16: TERMINATION OTHER THAN FOR DEFAULT
16.1. Condemnation.
16.1.1. Total Taking. In the case of a taking by eminent domain of either all
of the Premises or such portion of either the Premises or the Building as shall, in Landlord's sole
judgment, be required for reasonable use of the Premises, this Lease shall terminate as of the date
of such taking. If Tenant is not in default under any of the provisions of this Lease on said date,
any Rent prepaid by Tenant shall, to the extent allocable to any period subsequent to the
effective date of the termination, be promptly refunded to Tenant.
16.1.2. Partial Taking. In the case of a taking of portion of the Premises or
any buildings or structures of which the Premises are a part as shall not, in Landlord's sole
judgment, be required for reasonable use of the Premises, this Lease shall continue in full force
and effect, and the Base Rent shall, as of the date of such taking, be equitably reduced based on
the proportion by which the Premises (but not the buildings or structures of which the Premises
are a part) is reduced.
16.1.3. Damages. Landlord reserves all right to the entire damage award or
payment for taking by eminent domain, and Tenant waives all claim whatsoever against
Landlord and/or the authority exercising eminent domain for damages for termination of its
leasehold or for interference with its business. Landlord and Tenant further agree that all
decisions regarding how the eminent domain proceeding should be handled shall be made in the
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sole discretion of Landlord (specifically including any response to a motion for order
adjudicating public use and necessity or and request for immediate possession), and Tenant shall
take no actions or steps which interfere with Landlord's ability to control the handling of the
eminent domain proceeding. Notwithstanding the foregoing, nothing in this Section shall be
considered to be a waiver or assignment by Tenant of any right to relocation assistance payments
or relocation advisory services which may be available in connection with the eminent domain
proceeding.
16.1.4. Eminent Domain. The term "eminent domain" as used in this
Section 16.1 shall including taking or damaging of property by, through or under any
governmental or quasi-governmental authority and the purchase or acquisition in lieu thereof.
16.2. Court Decree. In the event that any court having jurisdiction in the matter shall
render a decision which has become final and which will prevent the performance by Landlord
of any of its obligations under this Lease, then either party hereto may terminate this Lease by
written notice, and all rights and obligations hereunder (with the exception of any undischarged
rights and obligations that accrued prior to the effective date of termination) shall thereupon
terminate. If Tenant is not in default under any of the provisions of this Lease on the effective
date of such termination, any Rent prepaid by Tenant shall, to the extent allocable to any period
subsequent to the effective date of the termination, be promptly refunded to Tenant, along with
Tenant's security deposit. Tenant is not entitled to any compensation at termination for the
bargain value of the leasehold.
SECTION 17: PRIORITY
17.1. Subordination. Tenant agrees that this Lease shall be subordinate to any first
mortgage or deed of trust now existing or hereafter placed upon the Premises or the Building
created by or at the instance of Landlord and to any and all advances to be made thereunder and
to interest thereon and all renewals, replacements, or extensions thereof ("Landlord's
Mortgage"). Upon demand by Landlord or the holder of any Landlord's Mortgage ("Holder"),
Tenant shall execute and deliver subordination and attornment agreements in form and substance
satisfactory to such Holder. Tenant shall not be obligated to execute any agreement in favor of
Holder to confirm the subordination of this Lease unless such agreement contains nondisturbance
provisions reasonably acceptable to Tenant. Notwithstanding the foregoing, upon
demand of such Holder, such Landlord's Mortgage shall be subordinate to this Lease; provided,
however, that in such event, notwithstanding such subordination, such Landlord's Mortgage shall
be superior to this Lease with respect to (i) the right, claim and lien of the Landlord's Mortgage
in, to and upon any award or other compensation for any taking by eminent domain of any part
of the Premises or the Building and the right of disposition thereof in accordance with the
provisions of the Landlord's Mortgage; and upon any proceeds payable under any policies of fire
and rental insurance upon the Premises or the Building and to the right of disposition thereof in
accordance with the terms of the Landlord's Mortgage; (ii) any lien, right or judgment which
may have arisen at any time under the terms of the Lease; and (iii) such other matters as may be
specifically reserved by the Holder of such Landlord's Mortgage in writing in connection with
such subordination.
17.2. Attornment. Upon Holders' request Tenant shall attorn to the Holder of any
Landlord's Mortgage or any person or persons purchasing or otherwise acquiring the Building or
Premises at any sale or other proceeding under any Landlord's Mortgage. Tenant shall properly
execute, acknowledge and deliver instruments which the Holder of any Landlord's Mortgage
may reasonably require to effectuate the provisions of this Section.
17.3. Estoppel Certificates. Tenant shall, from time to time, upon written request of
Landlord, execute, acknowledge and deliver to Landlord or its designee a written statement
prepared by Landlord stating: the date this Lease was executed and the date it expires; the date
the term commenced and the date Tenant accepted the Premises; the amount of the current
minimum monthly Rent and the date to which such Rent has been paid; and certifying to the
extent true: that this Lease is in full force and effect and has not been assigned, modified,
supplemented or amended in any way (or specifying the date and terms of agreement so affecting
this Lease); that this Lease represents the entire agreement between the parties as to this leasing;
that all conditions under this Lease to be performed by Landlord have been satisfied; that all
required contributions by Landlord to Tenant on account of Tenant's improvements have been
received; that on this date there are no existing claims, defenses or offsets which Tenant has
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against the enforcement of this Lease by Landlord; that the security deposit is as stated in the
Lease; and such other matters concerning the status of the Lease as Landlord may reasonably
request. It is intended that any such statement delivered pursuant to this Section may be relied
upon by a prospective purchaser of Landlord's interest or the holder of any mortgage upon
Landlord's interest in the Building. If Tenant shall fail to respond within thirty (30) 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 that this Lease is in full force and effect, that there are no uncured defaults in
Landlord's performance, that the security deposit is as stated in the Lease, and that not more than
one month's Rent has been paid in advance.
SECTION 18: ACCESS AND EASEMENTS.
18.1. Access to Premises. Landlord may at any time enter upon the Premises, or any
part thereof, for the purpose of ascertaining the condition of the Premises or whether Tenant is
observing and performing the obligations assumed by it under this Lease, all without hindrance
or molestation from the Tenant. Landlord shall also have the right to enter upon the Premises for
the purpose of cleaning, repairing, altering or improving the Premises or the Building. All of the
above-mentioned rights of entry shall be exercisable upon request made on reasonable advance
notice to Tenant (except that no notice shall be required in the event of an emergency) or an
authorized employee of Tenant at the Premises, which notice may be given orally. Landlord shall
have the right to show the Premises at all reasonable times during business hours of Tenant to
any prospective purchasers, tenants or mortgagees of the same.
18.2. Easements. The Parties recognize that Landlord facilities are continuously being
modified to improve the utilities, services and premises used and provided by Landlord.
Landlord and its authorized utility service providers are hereby granted a continuous easement or
easements that Landlord believes is necessary within the Premises of Tenant, without any
additional cost to Landlord for the purposes expressed hereinabove. Landlord, its authorized
utility service provider, and their respective agents, shall have the right to enter the Premises of
Tenant, and to cross over, construct, move, reconstruct, rearrange, alter, maintain, repair and
operate the water lines, drainage lines, the electrical service, and all other services and facilities
required by Landlord for its use or that of its other tenants. Provided, however, that Landlord by
virtue of such use, does not substantially deprive Tenant from its beneficial use or occupancy of
its leased area for an unreasonable period of time, not to exceed thirty (30) working days,
without consent of Tenant.
SECTION 19: NON-WAIVER; RIGHT TO PERFORM
19.1. Receipt of Monies Following Termination. No receipt of monies by Landlord
from Tenant after the termination or cancellation of this Lease in any lawful manner shall
(i) reinstate, continue or extend the term of this Lease; (ii) affect any notice theretofore given to
Tenant; (iii) operate as a waiver of the rights of Landlord to enforce the payment of any Rent and
fees then due or thereafter falling due; or (iv) operate as a waiver of the right of Landlord to
recover possession of the Premises by proper suit, action, proceeding or remedy; it being agreed
that after the service of notice to terminate or cancel this Lease, or after the commencement of
suit, action or summary proceedings, or any other remedy, or after a final order or judgment for
the possession of the Premises, Landlord may demand, receive and collect any monies due, or
thereafter falling due, without in any manner affecting such notice, proceeding, suit, action or
judgment; and any and all such monies collected shall be deemed to be payments on account of
the use and occupation and/or Tenant's liability hereunder.
19.2. No Waiver of Breach. The failure of Landlord to insist in any one or more
instances, upon a strict performance of any of the covenants of this Lease, or to exercise any
option herein contained, shall not be construed as a waiver of or relinquishment for the future of
the performance of such covenant, or the right to exercise such option, but the same shall
continue and remain in full force and effect. The receipt by Landlord of the Rent or fees, with
knowledge of the breach of any covenant hereof, shall not be deemed a waiver of such breach,
and no waiver by Landlord of any provision hereof shall be deemed to have been made unless
expressed in writing and signed by Landlord. The consent or approval of Landlord to or of any
act by Tenant requiring Landlord's consent or approval shall not be deemed to waive or render
unnecessary Landlord's consent or approval to or of any subsequent similar acts by Tenant.
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19.3. No Waiver of Rent. The receipt by Landlord of any installment of Rent or of any
amount shall not be a waiver of any Rent or other amount then due.
19.4. Application of Payments. Landlord shall have the right to apply any payments
made by Tenant to the satisfaction of any debt or obligation of Tenant to Landlord, in Landlord's
sole discretion and regardless of the instructions of Tenant as to application of any such sum,
whether such instructions be endorsed upon Tenant's check or otherwise, unless otherwise
agreed upon by both parties in writing. The acceptance by Landlord of a check or checks drawn
by others than Tenant shall in no way affect Tenant's liability hereunder nor shall it be deemed
an approval of any assignment of this Lease or subletting by Tenant.
19.5. Port's Right to Perform. Upon Tenant's failure to perform any obligation or make
any payment required of Tenant hereunder beyond the applicable notice and cure periods
provided herein, Landlord shall have the right (but not the obligation) to perform such obligation
of Tenant on behalf of Tenant and/or to make payment on behalf of Tenant to such parties.
Tenant shall reimburse Landlord the reasonable cost of Landlord's performing such obligation
on Tenant's behalf, including reimbursement of any amounts that may be expended by Landlord,
plus interest at the Default Rate.
SECTION 20: SURRENDER AND HOLDING OVER
20.1. Surrender. At the expiration or sooner termination of this Lease, Tenant shall
promptly: (i) surrender possession of the Premises to Landlord in the same condition in which
received (or, if altered, then the Premises shall be returned in such altered condition unless
otherwise directed), reasonable wear and tear excepted, and (ii) deliver to Landlord all keys that
it may have to any and all parts of the Premises. If the Premises are not surrendered as provided
in this Section, Tenant shall indemnify and hold Landlord harmless against loss or liability
resulting from the delay by Tenant in so surrendering the Premises, including, without limitation,
any claims made by any succeeding occupant founded on such delay.
20.2. Holding Over. If Tenant, with the consent of Landlord, holds over after the
expiration or sooner termination of this Lease, the resulting tenancy will, unless otherwise
mutually agreed, be for an indefinite period of time on a month-to-month basis. During such
month-to-month tenancy, Tenant shall pay to Landlord one hundred fifty percent (150%) of the
Rent in effect upon the date of such expiration as stated herein. Tenant will continue to be bound
by all of the additional provisions of this Lease insofar as they may be pertinent.
20.3. For Rent Signs. Landlord shall have the right to place and maintain "For Rent"
signs in conspicuous places outside the Premises or the Building for one hundred eighty (180)
days prior to the expiration or sooner termination of this Lease.
SECTION 21: ENVIRONMENTAL STANDARDS.
21.1. Release of Hazardous Materials. Tenant shall not use, store, or dispose of or
otherwise allow the release of any hazardous waste or materials in, on or under the Premises, the
Building, or any adjacent property, or in any improvements placed on the Premises, except in
small amounts as ordinarily and customarily used for general office purposes, and then only in
accordance with all applicable laws, rules, regulations and ordinances. Tenant represents and
warrants to Landlord that Tenant's intended use of the Premises does not involve the use,
production, disposal or bringing on to the Premises of any hazardous waste or materials, except
in small amounts as ordinarily and customarily used for general office purposes, and then only in
accordance with all applicable laws, rules, regulations and ordinances. As used in this Section,
the term "hazardous waste or materials" includes any substance, waste or material defined or
designated as hazardous, toxic or dangerous (or any similar term) pursuant to any statute,
regulation, rule or ordinance now or hereafter in effect. Tenant shall promptly comply with all
such statutes, regulations, rules and ordinances, and if Tenant fails to so comply Landlord may,
after thirty (30) days' written notice to Tenant (except in case of emergency) effect such
compliance on behalf of Tenant. Tenant shall immediately reimburse Landlord for all costs
incurred in effecting such compliance.
21.2. Indemnity. Tenant agrees to indemnify and hold harmless Landlord against any
and all losses, liabilities, suits, obligations, fines, damages, judgments, penalties, claims, charges,
cleanup costs, remedial actions, costs and expenses (including, without limitation, consultant
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fees, attorneys' fees and disbursements) which may be imposed on, incurred or paid by
Landlord, or asserted in connection with the acts or omissions of Tenant, or Tenant's officers,
directors, employees, agents, contractors and invitees, resulting in the release of any hazardous
waste or materials prohibited in this Section 21. Notwithstanding anything contained herein to
the contrary, Tenant shall have no responsibility for any repair, remedial action, monitoring, or
any other required action or payment of any claims concerning noncompliance or compliance
with any statutes, regulations, rules and ordinances relating to any prior uses of the Premises, or
placement of materials on the Premises other than those so placed by or at the direction of
Tenant. Landlord agrees to defend, indemnify and hold Tenant and its agents, affiliates,
employees, and their officers and directors, harmless from and against any and all claims,
liabilities, penalties, forfeitures, losses or costs, including attorney's fees and expenses, arising
from the presence of Hazardous Substances including, but not limited to, asbestos-containing
materials, mold and lead-based paint, located in, on or under Premises arising from any such
prior or other use of the Premises. This indemnification is intended to constitute an indemnity
agreement within the meaning of Section 9607(e)(i) of the Comprehensive Environmental
Response, Compensation and Liability Act of 1989 (42 U.S.C. 9607(e)(i)), as amended from
time to time.
SECTION 22: MISCELLANEOUS
22.1. Notice. All notices hereunder shall be in writing and shall be delivered personally,
by certified or registered mail, by facsimile or by recognized overnight courier addressed as
provided in Section 1.4 or to such other respective addresses as either party hereto may hereafter
from time to time designate in writing. Notices shall be deemed delivered (i) when personally
delivered; (ii) on the third day after mailing when sent by certified or registered mail and the
postmark affixed by the United States Postal Service shall be conclusive evidence of the date of
mailing; (iii) on the date transmitted by facsimile, if the facsimile is confirmed received; or
(iv) on the first business day after deposit with a recognized overnight courier if deposited in
time to permit overnight delivery by such courier as determined by its posted cutoff times for
receipt of items for overnight delivery to the recipient. Payments may be made in the manner
provided for notice or may be delivered by regular mail (postage prepaid); provided, payments
made by regular mail (postage prepaid) shall be deemed delivered when actually received by
Landlord.
22.2. Brokers. Landlord and Tenant each warrant to the other that it has had no
discussions, negotiations and/or other dealings with any real estate broker or agent in connection
with the negotiation of this Lease, and that it knows of no other real estate broker or agent who is
or may be entitled to any commission or finder's fee in connection with this Lease. Landlord and
Tenant each agree to indemnify and hold the other harmless from and against any and all claims,
demands, losses, liabilities, lawsuits, judgments, costs and expenses (including without
limitation, attorneys' fees and costs) with respect to any leasing commission or equivalent
compensation alleged to be owing on account of such party's discussions, negotiations and/or
dealings with any real estate broker or agent other than Broker(s). This Section is not intended to
benefit any third parties and shall not be deemed to give any rights to brokers or finders. No
commission(s) or finders fee(s) shall be paid to Tenant, employee(s) of Tenant or any unlicensed
representative of Tenant. Landlord and Tenant shall each pay its respective Broker pursuant to
their respective separate agreements with such Broker; provided, however, Landlord's Broker (if
any) shall be free (but without obligation, except as separately agreed between Landlord's
Broker and Tenant's Broker) to share the commission payable to it with Tenant's Broker as
Landlord's Broker sees fit.
22.3. Building Directory. Landlord shall maintain in the lobby of Building a directory
which 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.
22.4. Building Name. The Building shall be known by such name as Landlord may
designate from time to time.
22.5. Consent. Whenever Landlord's prior consent or approval is required by this
Lease, the same shall not be unreasonably delayed but may, unless otherwise specifically
provided by this Lease, be granted or denied in Landlord's sole and absolute discretion.
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22.6. Wireless Devices. Tenant shall not install any wireless devices and/or transmitters
on or about the Premises without the prior written consent of Landlord and subject to any and all
conditions in such consent. Tenant specifically grants to Landlord the power to regulate and
control the use of unlicensed frequency bands (including, but not limited to, FCC Part 15
Subpart C, FCC Part 15 Subpart D (both asynchronous and Isochronous), IEEE 802.11 and
BlueTooth (ISM), and FCC UNII 1 and UNII 2 (IEEE 802.11a)) on or about the Premises.
22.7. Relationship to Landlord and Tenant. Nothing contained herein shall be deemed
or construed as creating the relationship of principal and agent, partnership, or joint venture
partners, and no provision contained in this Lease nor any acts of Tenant and Landlord shall be
deemed to create any relationship other than that of Tenant and Landlord.
22.8. Authority. Tenant represents and warrants that the person executing this Lease on
behalf of Tenant is duly authorized to execute and deliver this Lease on behalf of Tenant, and
that this Lease is binding upon Tenant in accordance with its terms.
22.9. Landlord's Liability. Anything in this Lease to the contrary notwithstanding,
covenants, undertakings and agreements herein made on the part of Landlord are made and
intended not as personal covenants, undertakings and agreements for the purpose of binding
Landlord's representatives and agents personally, but are made and intended for the purpose of
binding only the Landlord and 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, nor shall at any time be asserted or enforceable against Landlord, or its legal
representatives, successors, and assigns on account of the Lease or on account of any covenant,
undertaking or agreement of Landlord in this Lease contained.
22.10. Transfer of Landlord's Interest. In the event of any transfers of Landlord's interest
in the Premises or in the Building, other than a transfer for security purposes only, Landlord or
any transferor of Landlord's interest ("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 as long as the transferee assumes all of
Landlord's obligations under this Lease. Tenant agrees to promptly attorn to the transferee. In the
event of any transfer, Landlord shall transfer the Security Deposit to the transferee, if applicable.
22.11. Time. Time is of the essence of each and every one of Landlord's and Tenant's
obligations, responsibilities and covenants under this Lease.
22.12. Recording. Landlord and Tenant shall not record this Lease or any memorandum
thereof without the other party's prior written consent.
22.13. Nondiscrimination Services.
22.13.1. Tenant agrees that it will not discriminate by segregation or otherwise
against any person or persons because of race, gender, age, creed, color, national origin or sexual
orientation in furnishing, or by refusing to furnish to such person or persons, the use of the
facility herein provided, including any and all services, privileges, accommodations, and
activities provided thereby.
22.13.2. It is agreed that Tenant's noncompliance with the provisions of this
clause shall constitute a material breach of this Lease. In the event of such noncompliance,
Landlord may take appropriate action to enforce compliance, may terminate this Lease, or may
pursue such other remedies as may be provided by law.
22.14. Nondiscrimination Employment. Tenant covenants and agrees that in all matters
pertaining to the performance of this Lease, Tenant shall at all times conduct its business in a
manner which assures fair, equal and nondiscriminatory treatment of all persons without respect
to race, gender, age, color, creed, national origin or sexual orientation and, in particular:
22.14.1. Tenant will maintain open hiring and employment practices and will
welcome applications for employment in all positions from qualified individuals who are
member of racial or other minorities, and
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22.14.2. Tenant will comply with all requirements of applicable federal, state
and local laws or regulations issued pursuant thereto relating to the establishment of
nondiscriminatory requirements in hiring and employment practices and assuring the service of
all patrons or customers without discrimination as to any person's race, sex, age, creed, color or
national origin.
22.15. Joint and Several Liability. Each and every party who signs this Lease, other than
in a representative capacity, as Tenant, shall be jointly and severally liable hereunder. It is
understood and agreed that for convenience the word "Tenant" and verbs and pronouns in the
singular number and neuter gender are uniformly used throughout this Lease, regardless of the
number, gender or fact of incorporation of the party who is, or of the parties who are, the actual
lessee or lessees under this agreement.
22.16. Captions. The captions in this Lease are for convenience only and do not in any
way limit or amplify the provisions of this Lease.
22.17. Governing Law; Venue. This Lease shall be construed under the laws of
Washington. Exclusive jurisdiction and venue for any action relating hereto shall be in the state
or federal courts located in King County, Washington.
22.18. Attorneys' Fees. In the event that either party shall be required to bring any action
to enforce any of the provisions of this Lease, or shall be required to defend any action brought
by the other party with respect to this Lease, and in the further event that one party shall
substantially prevail in such action, the losing party shall, in addition to all other payments
required therein, pay all of the prevailing party's actual costs in connection with such action,
including such sums as the court or courts may adjudge reasonable as attorneys' fees in the trial
court and in any appellate courts.
22.19. Invalidity of Particular Provisions. If any term or provision of this Lease or the
application thereof to any person or circumstance shall, to any extent, be invalid or enforceable,
the remainder of this Lease or the application of such term or provision to persons or
circumstances other than those as to which it is held invalid or unenforceable shall not be
affected thereby and shall continue in full force and effect.
22.20. Survival of Indemnities. All indemnities provided in this Lease shall survive the
expiration or any earlier termination of this Lease. In any litigation or proceeding within the
scope of any indemnity provided in this Lease, the indemnifying party shall, at the indemnified
party's option, defend the indemnified party at the indemnifying party's expense by counsel
satisfactory to Landlord.
22.21. Entire Agreement; Amendments. This Lease, together with any and all exhibits
attached hereto, shall constitute the whole agreement between the parties. There are no terms,
obligations, covenants or conditions other than those contained herein. No modification or
amendment of this agreement shall be valid or effective unless evidenced by an agreement in
writing signed by both parties.
22.22. Exhibits. Exhibits A, B, C and D are attached to this Lease after the signatures
and by this reference incorporated herein.
IN WITNESS WHEREOF this Lease has been executed the day and year first above set
forth.
PORT OF SEATTLE COLUMBIA HOSPITALITY, INC.
By: _________________________________ By: _________________________________
Its: ______________________________ Its: ______________________________
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SECTION 23: ACKNOWLEDGMENTS
LANDLORD
STATE OF WASHINGTON )
) ss
COUNTY OF KING )
On this ___ day of August 2015 before me personally appeared ____________________________, to me
known to be the _________________________________ of the PORT OF SEATTLE, the municipal corporation
that executed the within and foregoing instrument, and acknowledged 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 s/he was
authorized to execute said instrument.
In Witness Whereof I have hereunto set my hand and affixed my official seal the day and year first above
written.
_____________________________________________
(Signature)
_____________________________________________
(Print Name)
Notary Public, in and for the State of Washington,
residing at _____________________________________
My Commission expires: _________________________
TENANT
STATE OF WASHINGTON )
) ss
COUNTY OF KING )
On this ___ day of August 2015 before me personally appeared ____________________________, to me
known to be the _________________________________ of the ___________________________________, the
individual/entity that executed the within and foregoing instrument as Tenant, and acknowledged said instrument to
be the free and voluntary act and deed of said individual/entity, for the uses and purposes therein mentioned, and on
oath stated that s/he was authorized to execute said instrument.
In Witness Whereof I have hereunto set my hand and affixed my official seal the day and year first above
written.
_____________________________________________
(Signature)
_____________________________________________
(Print Name)
Notary Public, in and for the State of Washington,
residing at _____________________________________
My Commission expires: _________________________
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EXHIBIT A
LEGAL DESCRIPTION OF LAND ON WHICH BUILDING IS LOCATED
All that portion of Block 171B, Seattle Tide Lands, according to the official maps thereof on file
in the Office of the Commissioner of Public Lands in Olympia, Washington, and of Block 32,
Addition to the Town of Seattle as laid out by A. A. Denny (commonly known as A. A. Denny's
Sixth Addition to the City of Seattle), according to the plat thereof recorded in Volume 1 of
Plats, page 99, in King County, Washington, described as follows:
Beginning at the most southerly corner of Lot 6, said Block 171B; thence north 4741'27" west
along the southwesterly line of said block, 262.21 feet to an intersection with a line concentric
with and 15.0 feet southwesterly from the centerline of Burlington Northern Railroad Company's
(formerly Great Northern Railway Company) most southerly track which passes through said
blocks, as said track was located on May 16, 1989, said concentric line being on a curve of
1,560.60 foot radius, the origin of which bears north 2512'42" east 1,560.60 feet from said
intersection; thence southeasterly along said curve and concentric line an arc distance of 122.16
feet through a central angle of 429'06" to a point of tangency therein; thence south 6916'24"
east along aforesaid line parallel with and 15.0 feet southwesterly from track centerline a
distance of 69.24 feet to the beginning of a curve to the right of 1,451.11 foot radius; thence
along said curve concentric with and 15.0 feet southwesterly from said track centerline an arc
distance of 85.35 feet through a central angle of 322'12" to the beginning of a curve to the right
of 659.64 foot radius; thence along said curve concentric with and 15.0 feet southwesterly from
said track centerline an arc distance of 2.47 feet through a central angle of 012'13" to the
southeasterly line of aforesaid Lot 11, Block 32; thence south 4218'55" west along said
southeasterly line and along the southeasterly line of said Lot 6, Block 171B, 95.73 feet to the
point of beginning; TOGETHER WITH that portion of vacated Blanchard Street, as vacated by
City of Seattle Ordinance Number 117279, which attached to said Blocks 32 and 171B by
operation of law, and that portion of the vacated northeasterly 31 feet of Alaskan Way, as
vacated by City of Seattle Ordinance Number 117279 which lies northwesterly of the
southwesterly extension of the centerline of said vacated Blanchard Street; all lying
southwesterly of a line concentric and/or parallel with and 15.0 feet southwesterly form the
centerline of Burlington Northern Railroad Company's (formerly Great Northern Railway
Company's) most southwesterly track which passes through said Avenue and Street.
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EXHIBIT B
PREMISES
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EXHIBIT D
TENANT IMPROVEMENTS WORK LETTER
1. The Tenant Work. Under the Lease, Tenant has agreed to accept the Premises in their
current condition without any obligations for the performance of additional improvements or
other work by Landlord. Notwithstanding the foregoing, Landlord has agreed that Tenant may
perform certain Tenant Improvements, including but not limited to architectural fees for design
and construction drawings, permit fees and demolition of existing improvements, installation of
partition walls, demising walls, cabling and telephone lines, new carpet and new paint. Tenant
Work shall be in accordance with the provisions of this Work Agreement and, to the extent not
inconsistent herewith, the provisions of the Lease. Performance of the Tenant Work shall not
serve to abate the payment of Rent or otherwise extend the Rent Commencement Date under the
Lease.
2. Cost of the Work. Except as provided hereinafter, Tenant shall pay all costs (the "Costs
of the Work") associated with the Tenant Improvements whatsoever, including without
limitation, all permits, inspection fees, fees of architects, engineers, and contractors, utility
connections, the cost of all labor and materials, bonds, insurance, and any structural or
mechanical work, additional HVAC equipment or sprinkler heads, or modifications to any
building mechanical, electrical, plumbing or other systems and equipment or relocation of any
existing sprinkler heads, either within or outside the Premises required as a result of the layout,
design, or construction of the Tenant Improvements.
3. Review and Approval.
3.1. Preliminary Plan and Specifications.
3.1.1. Submission. No later than thirty (30) days after the mutual execution of
the Lease, Tenant shall submit two (2) sets of a "Preliminary Plan" (as described in Section 12
herein) to Landlord for approval.
3.1.2. Review. Landlord shall, within ten (10) working days after receipt
thereof, either approve said Preliminary Plan, or disapprove the same advising Tenant of the
reasons for such disapproval. If necessary, Landlord shall also endeavor to obtain Landlord's
insurers approval of any sprinkler drawings. In the event Landlord disapproves said Preliminary
Plan, Tenant shall modify the same, taking into account the reasons given by Landlord for said
disapproval, and shall submit two sets of the revised Plan to Landlord within ten (10) working
days after receipt of Landlord's initial disapproval.
3.2. Working Drawings and Engineering Report.
3.2.1. Submission. No later than sixty (60) days after mutual execution of this
lease, Tenant shall submit to Landlord for approval two (2) sets of "Working Drawings" (as
defined in Section 8 herein), and a report (the "Engineering Report") from Tenant's mechanical,
structural and electrical engineers indicating any special heating, cooling, ventilation, electrical,
heavy load or other special or unusual requirements of Tenant.
3.2.2. Review. Landlord shall, within ten (10) working days after receipt
thereof, either approve the Working Drawings and Engineering Report, or disapprove the same
advising Tenant of the reasons for disapproval. If necessary, Landlord shall also endeavor to
obtain Landlord's insurers approval of any sprinkler drawings. If Landlord disapproves of the
Working Drawings or Engineering Report, Tenant shall modify and submit revised Working
Drawings, and a revised Engineering Report, taking into account the reasons given by Landlord
for disapproval, within ten (10) working days after receipt of Landlord's initial disapproval.
3.3. Change Orders. No changes, modifications, alterations or additions to the
approved Preliminary Plan or Working Drawings may be made without the prior written consent
of Landlord after written request therefore by Tenant. In the event that the Premises are not
constructed in accordance with said approved Preliminary Plan and Working Drawings, then
Tenant shall not be permitted to occupy and/or conduct business from the Premises until the
Premises reasonably comply in all respects with said approved Preliminary Plan and Working
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Drawings; in such case, the Rent shall nevertheless commence to accrue and be playable as
otherwise provided in the Lease.
3.4. Final Inspection. Landlord's acceptance of the Tenant Improvements as being
complete in accordance with the approved Preliminary Plan and Working Drawings shall be
subject to Landlord's inspection and written approval. Tenant shall give Landlord five (5) days
prior written notification of the anticipated completion date of the Tenant Improvements.
3.5. Landlord's Approval.
3.5.1. Landlord shall not unreasonably withhold approval of any Preliminary
Plan, Working Drawings, Engineering Report, or Change Order submitted hereunder if they
provide for a customary layout, are compatible with the Building's shell and core construction,
and will not require any structural modifications to the Building, whether required by heavy
loads or otherwise.
3.5.2. Landlord's approval of Tenant's Preliminary Plans, Working Drawings,
Engineering Report or Change Order, and Landlord's recommendations or approvals concerning
contractors, subcontractors, engineers or architects (if any) shall not be deemed a warranty as to
the quality or adequacy of the Tenant Improvements, or the design thereof, or of its compliance
with Laws, codes and other legal requirements.
4. Compliance. The Tenant Improvements shall comply in all respects with the
following: (a) the Building Code of the City and State in which the Building is located and
State, County, City or other laws, codes, ordinances and regulations, as each may apply
according to the rulings of the controlling public official, agent or other such person, (b)
applicable standards of the National Board of Fire Underwriters and National Electrical Code,
and (c) building material manufacturer's specifications. If necessary, the Tenant Improvements
shall also comply with the requirements of Landlord's insurer.
5. Architects, Engineers, and Contractors.
5.1. Qualified Professionals. The Preliminary Plan, Working Drawings, Engineering
Report and the Tenant Improvements, shall be prepared and performed by licensed, reputable
and qualified architects, engineers and contractors.
5.2. Insurance Requirements.
5.2.1. Professional Liability. All architects and engineers shall carry
professional liability insurance with limits not less than one million dollars per claim
($1,000,000).
5.2.2. Worker's Compensation. All contractors and subcontractors shall carry
Worker's Compensation Insurance covering all of their respective employees in the statutorily
required amounts.
5.2.3. General Liability. All contrac tors and subcontractors shall each separately
obtain and keep in force a policy of general liability insurance consistent with the requirements
of Section 13.1.1 of the Lease; provided, however, (i) the limit for such insurance shall be at
least three million dollars ($3,000,000) notwithstanding any other amount set forth in the Lease,
and (ii) the policies therefore shall cover both Landlord and Tenant, as additional
insureds. Evidence of such insurance shall be delivered to Landlord before the construction is
commenced or contractor's equipment is moved onto the building.
6. Performance.
6.1. The Tenant Improvements shall be commenced promptly following the
Possession Date, and shall thereafter be diligently prosecuted to completion, subject only to
delays for reasons beyond Tenant's control (except financial matters). All Tenant Improvements
shall conform with the Working Drawings approved by Landlord in writing, and Landlord may
periodically inspect the Tenant Improvements for such compliance. The Tenant Improvements
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shall be coordinated under Landlord's direction with other work being done or to be performed
for or by other tenants in the building so that the Tenant Improvements will not interfere with or
delay the completion of any other construction work in the building.
6.2. Tenant shall perform the Tenant Improvements in a thoroughly safe, first-class
and workmanlike manner in conformity with the approved Preliminary Plan and Working
Drawings, and shall be in good and usable condition at the date of completion.
6.3. Tenant shall be required to obtain and pay for all necessary permits and/or fees
with respect to the Tenant Improvements, copies of which shall be provided to Landlord prior to
commencement of the Tenant Improvements.
6.4. Each contractor and subcontractor shall be required to obtain prior written
approval from Landlord for any space outside the Premises within the building, which such
contractor or subcontractor desires to use for storage, handling, and moving of his materials and
equipment, as well as for the location of any facilities or personnel. Nothing in the paragraph
shall, however, give rise to any obligation on Landlord to provide such space.
6.5. The contractors and subcontractors shall be required to remove from the Premises
and dispose of, at least once a week and more frequently as Landlord may direct, all debris and
rubbish caused by or resulting from the construction. Upon completion of the Tenant
Improvements, the contractors and subcontractors shall remove all surplus materials, debris and
rubbish of whatever kind remaining within the building which has been brought in or created by
the contractors and subcontractors in the performance of the Tenant Improvements. If any
contractor or subcontractor shall neglect, refuse or fail to remove any such debris, rubbish,
surplus material or temporary structures within two (2) days after notice to Tenant from Landlord
with respect thereto, Landlord may cause the same to be removed by contract or otherwise as
Landlord may determine expedient, and charge the cost thereof to Tenant as additional Rent
under the Lease.
6.6. Tenant shall obtain utility service, including meter, from the utility company
supplying service, unless Landlord elects to supply service and/or meters. Tenant shall obtain
and furnish Landlord copies of all approvals with respect to electrical, water and telephone work
as may be required by the respective company supplying the service.
6.7. Tenant shall, at its cost and expense construct, purchase, install and perform any
and all work included within the Tenant Improvements so as to obtain any governmentally
required certificate of occupancy and to occupy the Premises as soon as possible.
6.8. Copies of "as built" drawings shall be provided to Landlord no later than thirty
(30) days after completion of the Tenant Improvements.
6.9. Landlord shall not be responsible for any disturbance or deficiency created in the
air conditioning or other mechanical, electrical or structural facilities within the building or
Premises as a result of the Tenant Improvements. If such disturbances or deficiencies result,
Tenant shall correct the same and restore the services to Landlord's reasonable satisfaction,
within a reasonable time. Tenant shall use Landlord's approved HVAC Service provider for any
and all installations and adjustments required to the Premises in the course of the Tenant
Improvements. Tenant's mechanical system (heating, ventilating, and air conditioning) shall tie
into the central EMCS (emergency management control system) and the type of keys to such
system shall match those specified in the Building plans.
6.10. If performance of the Tenant Improvements shall require that additional services
or facilities (e.g., common area cleaning services) be provided, Tenant shall pay Landlord's
reasonable charges therefore.
6.11. Tenant's contractors shall comply with the rules of the building and Landlord's
requirements respecting allowable construction hours and manner of handling materials,
equipment and debris. Construction activities, delivery of materials, equipment and removal of
debris must be arranged to avoid any inconvenience or annoyance to other occupants. The
Tenant Improvements and all cleaning in the Premises must be controlled to prevent dirt, dust or
other matter from infiltrating into adjacent Tenant or mechanical areas.
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6.12. Landlord may impose reasonable additional requirements from time to time in
order to ensure that the Tenant Improvements, and the construction thereof does not disturb or
interfere with any other Tenants of the building, or their visitors, contractors or agents, nor
interfere with the efficient, safe and secure operation of the building. Tenant's Contractor shall
obtain a copy of, and comply at all times with, the then current contractor's rules and regulations
for the Building.
7. Liens. Tenant shall keep the Premises, the building and surrounding areas free from any
mechanic's, materialman's or similar liens or other such encumbrances in connection with the
Tenant Improvements, and shall indemnify and hold Landlord harmless from an against any
claims, liabilities, judgments, or costs (including attorneys' fees) arising in connection
therewith. Tenant shall remove any such lien or encumbrance by bond or otherwise within thirty
(30) days after written notice by Landlord, and if Tenant shall fail to do so, Landlord may pay
the amount necessary to remove such lien or encumbrance, without being responsible for
investigating the validity thereof. The amount paid shall be deemed additional rent under the
Lease payable upon demand, without limitation as to other remedies available to Landlord under
the Lease. Nothing contained herein shall authorize Tenant to do any act which shall subject
Landlord's title to the building or Premises to any liens or encumbrances whether claimed by
operation of law or express or implied contract. Any claim to a lien or encumbrance upon the
building or Premises arising in connection with the Tenant Improvements shall be null and void,
or at Landlord's option shall attach only against Tenant's interest in the Premises and shall in all
respects be subordinate to Landlord's title to the building and Premises.
8. Certain Definitions. As used in this Work Agreement, the following terms shall have the
meanings provided in this Section.
8.1. Preliminary Plan. "Preliminary Plan" shall mean and refer to a plan, drawn to
scale, showing: (1) demising walls, corridor doors, interior partition walls and interior doors (if
any), (2) any restrooms, kitchens, computer rooms, file rooms and other special purpose rooms,
and any sinks or other pluming facilities, or other special facilities or equipment, (3) all utility
connections, (4) any communications system, indicating telephone and computer outlet location,
(5) and other Lines (as defined in the Lease), and (6) any other details or features required to
reasonably delineate the Work to be performed.
8.2. Working Drawings. "Working Drawings" shall mean and refer to fully
dimensioned architectural construction drawings and specifications, and any required
engineering drawings (including mechanical, electrical, plumbing, air-conditioning, ventilation
and heating), and shall include any applicable items described above for the Preliminary Plan,
and if applicable: (1) electrical outlet locations, circuits and anticipated usage therefore, (2)
reflected ceiling plan, including lighting, switching, and any special ceiling specifications, (3)
duct locations for heating, ventilating and air-conditioning equipment, (4) dimensions of all
equipment and cabinets to be built in, (5) location of all Lines (as defined in the Lease), (6)
location of any equipment or systems (with brand names wherever possible) which require
special consideration relative to air-conditioning, ventilation, electrical, plumbing, structural, fire
protection, life-fire-safety system, or mechanical systems, (7) weight and location of heavy
equipment, and anticipated loads for special usage rooms, and (8) any other details or features
required to completely delineate the Work to be performed.
9. Incorporation into Lease; Defaults.
9.1. Incorporation. The Parties ag ree that the provisions of this Work Agreement are
hereby incorporated by this reference into the Lease fully as though set forth therein. In the
event of any express inconsistencies between the Lease and this Work Agreement, the latter shall
govern and control.
9.2. Defaults. If Tenant shall default under this Work Agreement, Landlord may order
that all Tenant Improvements being performed in the Premises be stopped immediately, and that
no further deliveries to the Premises be made, until such default is cured, without limitation as to
Landlord's other remedies. Any amounts payable by Tenant to Landlord hereunder shall be paid
as additional rent under the Lease. Any default by the other party hereunder shall constitute a
default under the Lease and shall be subject to the remedies and other provisions applicable
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thereto under the Lease. If Tenant shall default under the Lease or this Work Agreement and fail
to cure the same within the time permitted for cure under the Lease, at Landlord's option, all
amounts paid or incurred by Landlord towards the Improvement Allowance shall become
immediately due and payable as additional Rent under the Lease.
10. Tenant Reimbursement. Landlord shall contribute a Tenant Improvement Allowance of
for an amount up to FIVE HUNDRED THOUSAND AND NO/100 DOLLARS ($500,000.00)
towards Tenant's hard and soft costs and expenses incurred by Tenant in designing, permitting,
and constructing the Tenant Improvements as well as Tenant's Relocation Costs, as defined
below. Landlord shall reimburse Tenant within ten (10) business days after Tenant has submitted
to Landlord: (i) an invoice for the Tenant Improvement Allowance, (ii) the required "as-built"
drawings, including mechanical, plumbing and electrical details, (iii) a certificate from Tenant's
architect or contractor setting forth the description of the work performed, materials furnished,
and costs thereof incurred by or on behalf of Tenant, and (iv) reasonable evidence of the amount
incurred by Tenant for the Relocation Costs. Tenant must request reimbursement within one
hundred twenty (120) days of the substantial completion of the Tenant Improvements provided
by the Tenant. Landlord's obligation to pay the Tenant Improvement Allowance is expressly
conditioned upon the Tenant's timely request for such Tenant Improvement Allowance and
submission of all documentation required to make such request for the Tenant Improvement
Allowance. Any unused/unclaimed portion of the Tenant Improvement Allowance shall be
forfeited and not otherwise payable to Tenant.
11. Relocation Costs. Landlord acknowledges that it is, for Landlord's convenience,
requiring the relocation of Tenant from its current premises. As a result, Landlord also agrees
reimburse Tenant for certain of its relocation costs (the "Relocation Costs"), including but not
limited to business materials reflecting Tenant's new address (e.g., new stationery, business
cards, promotional brochures) up to an allowance of $25,000, Tenant's moving costs, and the
cost of work station cubicles reasonably necessary to equip the Premises for Tenant's use
(currently having primarily individual offices rather than an open floor plan).
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