HomeMy WebLinkAboutITEM VIII-B-2CITY OF
AUBU~:N
~~ WASHINGTON
AGENDA BILL APPROVAL FORM
Agenda Subject: Date:
Resolution No. 4229 Se tember 4, 2007
Department: Attachments: Budget Impact:
Human Resources Resolution No. 4229
Administrative Recommendation:
City Council to adopt Resolution No. 4229.
Background Summary:
A resolution authorizing the Mayor and City Clerk to execute a real estate transfer/sale agreement
between the City of Auburn and Raymond Lazor and Nancy Lazor and Harold Gambini and execute a
companion agreement, a sublease agreement between the City of Auburn and Harold Gambini.
S0904-1
A3.13.4
Reviewed by Council & Committees: Reviewed by Departments & Divisions:
^ Arts Commission COUNCIL COMMITTEES: ^ Building ^ M&O
^ Airport ®Finance ^ Cemetery ^ Mayor
^ Hearing Examiner ®Municipal Serv. ^ Finance ^ Parks
^ Human Services ^ Planning & CD ^ Fire ^ Planning
^ Park Board ^Public Works ^ Legal ^ Police
^ Planning Comm. ^ Other ^Public Works ^ Human Resources
^ Information Services
Action:
Committee Approval: ^Yes ^No
Council Approval: ^Yes ^No Call for Public Hearing _/_/_
Referred to Until _/_/_
Tabled Until _/_/_
Councilmember: Backus Staff: Heineman
Meeting Date: September 4, 2007 Item Number: VI11.B.2
~jJ$jJ * MORE T~-{AN YtJU 1NtAGINED
RESOLUTION N0.4 2 2 9
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF AUBURN, WASHINGTON, AUTHORIZING THE
MAYOR AND CITY CLERK TO EXECUTE A REAL
ESTATE TRANSFER/SALE AGREEMENT BETWEEN THE
CITY OF AUBURN AND RAYMOND LAZOR AND NANCY
LAZOR AND HAROLD GAMBINI AND EXECUTE A
COMPANION AGREEMENT, A SUBLEASE AGREEMENT
BETWEEN THE CITY OF AUBURN AND HAROLD
GAMBINI
WHEREAS, City of Auburn is working with property owners to promote
revitalization of the downtown core area; and
WHEREAS, Harold Gambini ("Gambini") and others are the owners of
certain real property located in the City of Auburn; and
WHEREAS, the City of Auburn desires to enter into a Real Estate
Transfer/Sale Agreement with Gambini whereby the City would acquire certain
property owned by Gambini, tied to the City's downtown revitalization efforts; and
WHEREAS, Gambini desires to sell this property to the City of Auburn in
exchange for funds and assignment of leases as set forth in the Auburn Sound
Transit Station Sublease Agreement; and
WHEREAS, Gambini recognizes that the Real Estate Transfer/Sale
Agreement is subject to the approval of the Auburn Sound Transit Station
Sublease Agreement and that the Real Estate Transfer/Sale agreement and the
Auburn Sound Transit Station Sublease are given in consideration of each other.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF AUBURN,
KING COUNTY, WASHINGTON, HEREBY RESOLVES as follows:
Resolution No. 4229
August 21, 2007
Page 1 of 2
Section 1. The Mayor of the City of Auburn and the Auburn City Clerk
are hereby authorized to execute a Real Estate Transfer/Sale Agreement and
Auburn Sound Transit Station Sublease Agreement between the City of Auburn
and Harold Gambini which agreements shall be in substantial conformity with the
agreements, copies of which are attached hereto, marked as Exhibit "A" and "B"
respectively and incorporated herein by this reference.
Section 2. The Mayor is hereby authorized to implement such
administrative procedures as may be necessary to carry out the directives of this
legislation.
Section 3. This resolution shall be in full force and effect upon passage
and signatures hereon.
Dated and Signed this day of
CITY OF AUBURN
PETER B. LEWIS
MAYOR
ATTEST:
Danielle E. Daskam, City Clerk
APP
D
.2007.
Resolution No. 4229
August 21, 2007
Page 2 of 2
REAL ESTATE TRANSFER/SALE AGREEMENT
This agreement made and entered into this day of August, 2007,
by and between the City of Auburn, a municipal corporation, organized under the
Optional Municipal Code, Title 35A RCW, hereinafter referred to as "Auburn" and
Raymond Lazor and Nancy Lazor, husband and wife, and Harold Gambini, a single
man, hereinafter referred to as "Gambini'.
Whereas, Gambini is the owner of certain real estate located in the City of
Auburn, legally described as Lots 3 and 4, Block 6, Town of Slaughter, according to the
Plat thereof, recorded in Volume 2 of Plats, page 56, records of King County,
Washington, tax parcel 781570-0290 and 781570-0295, and
Whereas, Gambini desires to enter into a sale of the above described property in
exchange for funds and an assignment of leases as set forth below, and
Whereas, Auburn desires to redevelop the property described above, and
surrounding properties as part of a revitalization of the City, such work to be done by the
third party, and
Whereas, for the revitalization effort is necessary to acquire the property set forth
above, and
Whereas, it is for the benefit of public health, safety and welfare of the City of
Auburn that Auburn acquire the subject property for the purposes of the revitalization
effort, and
Real Estate Transfer/Sale Agreement (8/21/07) - 1 -
Whereas, the assignment and/or subleases of commercial space and parking
spaces is allowable under the agreement between Sound Transit and the City of
Auburn, and
Whereas, the parties recognize this agreement is subject to surplusing the
certain property interest of the City of Auburn and approval by Auburn City Council.
Now, therefore, based upon mutual covenants to be derived the parties
agree as follows:
1. Real Estate Sale: Gambini agrees to sell, and Auburn agrees to purchase,
that certain real estate as legally described above. At the time of closing the seller shall
provide a Statutory Warranty Deed providing that the property is free and clear of all
liens and encumbrances and seller shall provide a policy of title insurance insuring that
the subject property is free and clear of all liens and encumbrances at a value of
$1,800,000.00.
2. Consideration: At the time of closing Auburn shall pay to Gambini the sum of
$1,125,000.00, cash at closing, plus provide assignments and/or subleases to those
commercial properties existing on the ground floor of the Sound Transit Station, Auburn,
Washington, together with 42 parking spaces located in the Sound Transit Terminal.
Auburn agrees to remove the costs of security from the triple net expenses charged
back to the tenant.
3. Involuntary Conversion: The parties agree that the property subject of this
sale is a part of an area-wide revitalization program, and that as a part of that program,
properties are being assembled by private property owners and developers for
Real Estate Transfer/Sale Agreement (8/21/07) - 2 -
economic development. Separate and apart from that, however, the subject property is
targeted to be a part street improvement program, identified as the Promenade
program, whereby improvements would be made to certain public rights-of-way to
enhance the public sidewalk. If the subject property were not sold, so as to make it
available for development as part of the area-wide revitalization program, it may
nevertheless be subject of condemnation in so far as the Promenade program could
require taking of some or all of the subject property for that purpose. Toward that end,
Gambini's position is that the subject property is being sold under threat of
condemnation and he intends to qualify as Involuntary Conversion as defined by the
IRS.
4. Closing: This transaction shall close on or before September 15, 2007 or such
other date as the parties may mutually agree.
5. Contingencies: This agreement is contingent upon Auburn declaring as
surplus the interest in the Sound Transit lease space and the 42 parking spaces and the
approval by the Auburn City Council of this agreement and no objections by Sound
Transit, and approval by the Auburn City Council of the sub-lease agreement for the
premises at the Sound Transit facility.
6. Assignment: The parties to this agreement may assign their interests. This
agreement shall be binding on the heirs, successors and assign of the parties.
7. Closing Costs: Gambini shall pay costs of title insurance premium and tax
and Auburn shall pay excise tax. Escrow fees to be divided between the parties. Real
estate taxes and utilities will be pro-rated to the time of closing.
Real Estate Transfer(Sale Agreement (8/21/07) - 3 -
8. Earnest Money: Auburn shall deposit $10,000.00 earnest money into escrow,
mutually agreed upon by the parties, upon execution, declaring of surplus and approval
by City Council, whichever occurs last.
Pete Lewis
Attested: Mayor, City of Auburn
Dated:
Dani Daskam
City Clerk, City of Auburn
Approved as to-Form:
Daniel Heid
City Attorney, City of Auburn
Raymond Lazor, Seller
Dated:
Nancy Lazor, Seller
Dated:
Harold Gambini, Seller
Dated:
Real Estate Transfer/Sale Agreement (8/21/07) - 4 -
AUBURN SOUND TRANSIT STATION
SUBLEASE AGREEMENT
CITY OF AUBURN - GAMBINI
THIS AGREEMENT made and entered into this day of
2007, by and between the City of Auburn, a municipal corporation, organized under Title
35A, RCW hereinafter referred to as "Auburn," and Harold Gambini, a single man, and
LLC., jointly and severally, hereinafter collectively referred to as
"Gambini."
WHEREAS, Auburn is in the process of revitalization efforts for the downtown
core area., and
WHEREAS, in the revitalization efforts, Auburn entered into agreements with
other public agencies and private parties to carry out the intent of the revitalization, and
WHEREAS, the revitalization of the downtown core area of the City of Auburn
will result in certain economic benefits and quality of life benefits that will enhance
public safety, health and- welfare, and
WHEREAS, to enhance quality development in the downtown area, and to
provide an efficient and cost effective mode of transportation to its citizens to other
geographic areas, Auburn entered into agreements with Central Puget Sound Regional
Transit Authority "Sound Transit", for the creation of a transit terminal, parking garage
and commercial tenancies within the parking garage, and
WHEREAS, Resolution #3469 was passed on May 20, 2002, attached as Exhibit
1 which authorized the entry into the lease between Central Puget Sound Regional
Transit Authority "Sound Transit" as landlord and City of Auburn "City" as tenant, dated
Auburn Sound Transit Station Sublease Agreement
City ofAuburn -Gambini
Page 1
8/20107
June 26, 2002, attached as Exhibit A to Resolution #3469, which becomes part of Exhibit
1 attached hereto, and
WHEREAS, to promote the development of quality commercial space in the
downtown area, in the proximity of the Sound Transit facility, the City of Auburn passed
Resolution #3701 on March 15, 2004, authorizing the execution of a LID Formation and
Guarantee Agreement wherein certain parking spaces were recognized to the Guarantor
of the agreement in the Sound Transit facility, and
WHEREAS, the parking spaces provided in the LID Formation and Guarantee
Agreement as authorized by Resolution #3701 are not inconsistent with parking provided
under the Real. Estate Transfer/Sale Agreement between Auburn and Gambini, and
WHEREAS, the Real Estate Transfer/Sale Agreement between Auburn and
Gambini is to further the revitalization efforts of the downtown City core area, and is
essential for a design consisting of a promenade in the vicinity of the Sound Transit
parking facility, and
WHEREAS, this agreement and the Real Estate/Transfer Sale Agreement are
entered into simultaneously to carry out part of the consideration requirements as set
forth in the Real Estate/Transfer Sale Agreement involving subleases to certain parking
stalls and subleases of the commercial tenant spaces on the ground floor of the parking
garage, and
WHEREAS, Auburn reviewed the value of the property it is purchasing from
Gambini, legally described as Lots 3 and 4, Block 6, Town of Slaughter, according to the
Flat thereof, recorded in Volume 2 of Flats, page 56, records of King County,
Auburn Sound Transit Station Sublease Agreement
City of Auburn -Gambini
Page 2
8/20/07
Washington, tax parcel 781570-0290 and 781570-0295, in light of the leasehold interest
it would be conveying to Gambini, and
WHEREAS, an appraisal was conducted on the Sound Transit facility leasehold
interests and parking spaces, and
WHEREAS, the appraisal and the valuation review indicate that the Real Estate
Transfer/Sale Agreement- between Auburn and Gambini is at fair and market value, .and
WHEREAS, as part of the consideration of the Real Estate Transfer/Sale
Agreement between Auburn and Gambini, Auburn, as Lessee from Sound Transit, as set
forth in Exhibit 1 shall sublease to Gambini the commercial spaces on the ground floor of
the transit facility and sublease 42 parking spaces in the Sound Transit terminal, and
WHEREAS, the parties intend and contemplate herein that, pursuant to the Lease
Agreement, Exhibit 1, Auburn shall still remain primarily liable to perform all. the
obligations under the lease, and
WHEREAS, the parties recognize that Auburn's option to purchase, as set forth
in Section 2.6, Exhibit 1 shall remain with Auburn exclusively and is not intended to be
assigned to Gambini hereunder.
NOW, THEREFORE, based upon mutual covenants and benefits to be derived,
THE PARTIES AGREE as follows:
1. Sale of Real Prouerty: Contemporaneous with this transaction, Gambini
shall sell and convey to Auburn Lots 3 & 4, Block 6, Town of Slaughter, according to
plat thereof, recorded in Volume 2 of plats, page 56, records of King County,
Washington, in accordance with and pursuant to the Purchase and Sale Agreement
between the parties.
2. Sublease: At the time of the closing of the Real Estate Transfer/Sale
Agreement between Auburn and Lazor and Gambini for Lots 3 & 4, Block 6, Town of
Auburn Sound Transit Station Sublease Agreement
City of Auburn -Gambini
Page 3
8/20/07
Slaughter, according to plat thereof, recorded in Volume 2 of plats, page 56, records of
King County, Washington, Auburn subleases to Lazor and Gambini that property
consisting of the ground floor commercial tenancies and 42 parking spaces on the ground
and second floor, as depicted in Exhibit "5" in the Sound Transit Terminal, Auburn,
Washington, described in Exhibit 1, attached hereto and incorporated by reference. The
Term of this Sublease shall commence on the day of , 2007,
and unless terminated earlier, the Term of this Sublease .shall expire at midnight on the
1st day of June, 2101. Gambini may negotiate or discuss lease issues directly with Sound
Transit. Any changes require Auburn's approval. This sublease includes a right by
commercial tenant for the use of the plaza tenant area as described in the Lease
Agreement, Exhibit 1. Auburn agrees not to lease, license or otherwise grant the right to
any person (sidewalk vendor) to offer competitive goods or services from a cart, kiosk, or
other temporary or permanent facility which goods are the same or competitive with
those offered by any subtenant or licensee of the Commercial Tenant Agreement, Exhibit
L
3. Assumption of Obligations: Gambini accepts all obligations and
conditions as they pertain to the commercial retail space as outlined in the Lease
Agreement between Auburn and Sound Transit, Exhibit 1, and the 42 parking spaces
provided in Section 2 hereof. Gambini assumes all obligations of Auburn, including but
not limited to all maintenance, repair, and operating costs, directly associated with the
Commercial Retail space, as Lessee, as they pertain to the commercial retail space as
outlined in the Lease Agreement, Exhibit 1, and the said 42 parking spaces. Auburn
represents that nothing in this sublease conflicts with the lease agreement, Exhibit 1.
4. Sound Transit Costs: Auburn will not bill Gambini for any security feel
or other charges that are billed by Sound Transit as set forth in Exhibit 1, except Auburn
will bill Gambini for one hundred percent (100%) of the water and sewer utility bills
from Sound Transit and for seven and eighteen one hundreds percent (7.18%) of the
property insurance and storm water utility billings the City receives from Sound Transit.
In the event Gambini is billed for a separate water meter supplied to Commercial tenant
Auburn Sound Transit Station Sublease Agreement
Ciry of Aubm~n -Gambini
Page 4
8/20/07
area, then Gambini and Auburn shall negotiate distribution of the water and sewer billing
from Sound Transit to reflect a fair distribution of this expense.
5. Potential Purchase: Auburn retains any right it has to the Option to
Purchase, as set forth in Section 2.6, Exhibit 1. In the event that Auburn exercises the
Option to Purchase, Gambini shall retain its rights as sub lessee for the duration of this
sublease.
6. Current Leases: Leases between Auburn and other tenants currently exist
for ground floor commercial spaces at the premises of this Sublease. Gambini shall
assume the position of Auburn as Lessor as to these leases and shall also comply with
any and all landlord obligations and shall take on all Sublessor obligations for the
subleases for the premises previously subleased to third parties, as follows:
A. That certain Sublease in which the City of Auburn, a Washington
municipal corporation, is the Sublessor, and PMF Enterprises, Inc. is the Tenant, dated
the 15th day of January, 2003, a copy of which is attached hereto, marked as Exhibit 2,
incorporated herein by this reference;
B. That certain Sublease in which the City of Auburn, a Washington
municipal corporation, is the Sublessor, and Edward D. Jones is the Tenant, dated the
29th day of April, 2004, a copy of which is attached hereto, marked as Exhibit 3,
incorporated herein by this reference;
C. That certain Sublease in which the City of Auburn, a Washington
municipal corporation, is the Sublessor, and Green River Community College is the
Tenant, dated the 15th day of April, 2005, a copy of which is attached hereto, marked as
Exhibit 4, incorporated herein by this reference.
In connection therewith, all compensation paid by tenants thereof shall be paid to
Gambini.
7. Leasehold Excise Tax: Gambini agrees to pay to Auburn, or the
appropriate .recipient, the amount of any leasehold excise tax required to be paid under
the laws of the State of Washington and ordinances of the City of Auburn, or collect the
same from Gambini's tenants and forward the same to Auburn, or the appropriate
recipient, which leasehold excise taxes shall be paid ~~~ithin 30 days after notification
Auburn Sound Transit Station Sublease Agreement
City of Auburn -Gambini
Page 5
8/20/07
from Auburn as to the amount due. Gambini shall also provide Auburn with the
information needed by Auburn to determine the amounts of the leasehold excise taxes,
which information shall be provided at least 30 days after requested by Auburn. It shall
not be considered a gratuity if any tenant's rent payment is reduced in any amount in any
month providing that tenant's entire lease terms is at market value. Provided, however,
that the leasehold tax shall be paid on the actual market value in the event of any such
reduction.
8. Auburn to Remain Obligated: Auburn shall still remain liable to Sound
Transit for the performance of obligations under the Lease Agreement, Exhibit 1.
9. Time is of the Essence: Time is of the essence in the performance of all
covenants and conditions under this Sublease of Auburn and of Gambini.
10. Breach and Remedies Generally:
A. Default and Breach Defined. A party to this Sublease shall be in "default"
of an obligation it has under this Sublease if the party does not pay or perform the
obligation as and when due, except that if such failure is later cured, then the party shall
no longer be in default on the obligation. A party to this Sublease shall be in "breach" of
an obligation it has under this Sublease:
(1) If the party fails to make any payment required of it under this Sublease
within thirty (30) days after. the other party's written notice of default specifying the
amounts in default and the due date(s) thereof;
(2) If the party fails to perform any of the party's other obligations under this
Sublease for a period of thirty (30) days after written notice from the other party
specifying the obligation in default and the action required of the party in default to cure
such default. However, if more than thirty (30) days are reasonably required to complete
such performance, the party in default shall not be in breach if the party commences such
performance within the thirty (30) day period and thereafter diligently and continuously
pursues such performance to completion.
(3) If (i) a petition for adjudication of bankruptcy or for reorganization or
rearrangement is filed by or against the party and is not dismissed within one hundred
eighty (180) days; or if (ii) if a trustee or receiver is appointed to take possession of
Auburn Sound Transit Station Sublease Agreement
City of Auburn Gambini
Page 6
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substantially all of the party's assets and such appointment is not dismissed or if
possession of such assets is not restored to the party within one hundred eighty (180
days) after such appointment.
B. The requirements for notice specified in subparts (1) and (2) of Section
10.A are intended to satisfy any and all notice requirements imposed by law and are not
in addition to any such requirement.
11. Auburn's Remedies for Gambini's Breach:
A. General Provisions. On or at any time after the occurrence of any breach
of one or more of Gambini's .material obligations under this Sublease, Auburn may elect
to:
(1) Recover the sums owed by Gambini under this Sublease together with
interest thereon at the rate of eight percent (8%) per annum on the unpaid principal
balance thereof from time to time beginning with the date the sums were due and ending
when the sums have been fully paid;
(2) Specifically enforce Gambini's obligations under this Sublease;
(3) Recover damages caused to Auburn by Gambirii's breach; and/or
(4) Perform the obligations of Gambini that are in breach and recover from
Gambini the costs incurred by Auburn in such performance.
The remedies provided in this section are cumulative with each other and
cumulative with and in addition to all other remedies as may be permitted by law or
equity except that Auburn hereby waives and releases any and all rights, and shall have
no right, to terminate this Sublease or Gambini's rights of possession of any part of the
Leased Premises on account of any breach by Gambini of one or more of its obligations
under this Sublease. As a substitute for such termination, Auburn may obtain an order
from a court with jurisdiction over the parties and the subject matter directing Gambini's
subtenants and licensees to attorn to and perform to and for the benefit of Auburn all of
such subtenants' and licensees' respective obligations under their sublease or license until
Gambini has fully cured its breach, including payment (to the extent applicable) under
subparts (1); (2) and (4) of this section or such other time as the court may direct.
Auburn Sound Transit Station Sublease Agreement
City of Auburn -Gambini
Page 7
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B. Emergencies, If Gambini's default in any of its obligations under this
Sublease creates or enhances an emergency, a serious risk of death or injury to any
person, or a serious risk of injury or damage to any property, Auburn may, without giving
Gambini prior notice and opportunity to cure, immediately exercise the remedy specified
in Section 9.3 (a) (iv) with respect to that default and, for that purpose, enter any part of
the leased premises reasonably necessary to do so.
12. Gambini's Remedies for Auburn's Breach:
A. General Provisions. On or at any time after the occurrence of any breach
of one or more of Auburn's obligations under this Sublease, Gambini may elect to:
(1) Terminate this Sublease and recover ar_d setoff under subparts (4) and (5)
of this Section;
(2) Bring an action for specific .performance of Auburn's obligations and
recover under subpart (4) of this Section;
(3) Perform the obligations of Auburn which are in breach and recover under
subpart (iv) of this Section;
(4) Recover from Auburn (a) all monetary sums, if any, then due and unpaid
to Gambini by Auburn, (b) the costs of performing or completing obligations of which
Auburn is in breach, and (c) damages caused to Gambini by Auburn's breach; and
(5) Setoff all or any part of the sums described in subpart (4) of this Section
against any sums payable by Gambini to Auburn under this Sublease in the order in
which such sums would otherwise be due until the entire amount, together with interest at
eight percent (8%) per annum on the declining principal balance thereof, has been fully
setoff.
Gambini shall give Auburn written notice of Gambini's elections under this
Section 12. Gambini's election of any of the remedies under subparts (2) through (5)
shall not preclude .Gambini from electing at a subsequent time any other of such remedies
or of electing to proceed under subpart (1). The election of the remedy under subpart (1)
precludes the subsequent exercise of any other remedy. Except as provided in the
preceding sentence, the remedies specified in this Section are cumulative with each other
Auburn Sound Transit Station Sublease Agreement
City of Auburn -Gambini
Page 8
8/20/07
and cumulative with and in addition to all other remedies as may. be permitted by law or
equity.
B. Emergencies. If Auburn's default in any of its obligations under this
Sublease creates or enhances an emergency, a serious risk of death or injury to any
person, or a serious risk of injury or damage to any property, Gambini may, without
giving Auburn prior notice and opportunity to cure, immediately exercise the remedy
specified in Section 12.A (4) with respect to that default and, for that purpose, enter any
part of the Parking Garage and of the Station reasonably necessary to do so.
13. Interest: Any amount owed by one party to the other under this Sublease
which is not paid when due shall bear interest at the rate of eight percent (8%) per annum
from the due date of such amount. The payment of interest on such amounts shall not
excuse or cure any default under this Sublease on account of the failure to pay the amount
owed when due.
14. Indemnification and Hold Harmless: Gambini shall defend, indemnify,
and hold harnless Auburn, its officers, officials, employees and volunteers from and
against any and all claims, suits, actions, or liabilities for injury or death of any person, or
for .loss or damage to property, which arises out of Gambini's use of the commercial
retail space, or from the conduct of Gambini's business, tenants, or from any activity,
work or thing done, permitted, or suffered by Gambini in or about the premises, except
only such injury or damage as shall have been occasioned by the sole negligence of
Auburn.
Auburn shall defend, indemnify and hold harmless Gambini from any claims by
Sound Transit that Auburn breach its lease with Sound Transit.
15. Insurance: Gambini shall procure and maintain for the duration of the
Agreement, insurance against claims for injuries to persons or damage to property which
may arise from or in connection with Gambini's operation and use of the. sub-leased
premises.
A. Minimum Scope of Insurance. Gambini shall obtain Commercial General
Liability insurance v~~ritten on Insurance Services Office (ISO) occurrence form CG 00 O1
and shall cover premises and contractual liability. Auburn shall be named as an insured
Auburn Sound Transit Station Sublease Agreement
City of Auburn -Gambini
Page 9
8/20/07
on Gambini's Commercial General Liability insurance policy using ISO Additional
Insured-Managers or Lessors of Premises Form CG 20 11 or a substitute endorsement
providing equivalent coverage.
Commercial General Liability insurance shall be written with limits no less than
$.1,000,000 each occurrence, $2,000,000 general aggregate.
Property insurance shall be written covering the full value of Gambini's property
and improvements with no coinsurance provisions.
The insurance policies are to contain, or be endorsed to contain, the following
provisions for Commercial General Liability insurance:
The Gambini's insurance coverage shall be primary insurance as respect to
Auburn. Any Insurance, self-insurance, or insurance pool coverage maintained by
Aubum shall be excess of the Gambini's insurance and shall. not contribute with it.
Gambini's insurance shall be endorsed to state that coverage shall not be
cancelled by either party, except after thirty (30) days prior written notice by certified
mail, return receipt requested, has been given to Auburn.
B. Verification of Coverage. Gambini shall furnish Auburn with original
certificates and a copy of the amendatory endorsements, including but not necessarily
limited to the additional insured endorsement, evidencing the insurance requirements of
the Gambini.
C. Waiver of Subrogation. Gambini and Auburn hereby release and
discharge each other from all claims, losses and liabilities arising from or caused by any
hazard covered by property insurance on or in connection with the premises or said
building. This release shall apply only to the extent that such claim, loss or liability is
covered by insurance.
D. Destruction of Property/Insurance Benefit. In the event of any destruction
of property, Gambini shall receive value of Gambini's interest from any insurance
proceeds as described in the Lease Agreement, Exhibit 1, which value shall be
determined by prorating the lease terms and lease amount remaining as taken as a
percentage to the total property value.
Auburn Sound Transit Station Sublease Agreement
City of Auburn -Gambini
Page 10
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16. Condemnation: In the event of a condemnation Gambini would have the
right to participate and any compensation received would be awarded as set forth in 15.E.
above.
17. Attorneys' Fees and Costs: In any action between the parties arising out
of or related to this Sublease, the prevailing party shall recover from, and the losing party
shall pay to the prevailing party, the prevailing party's reasonable expenses of the action.
"Action" includes: (i) litigation or other adversary proceeding in any court or
governmental body with jurisdiction (including but not limited to a bankruptcy court);
appeals of the decision of any lower tribunal (including but not limited to an award in
arbitration); and, if such proceedings are required by law or agreed by the parties,
alternative dispute resolution proceedings (such as but not limited to mediation and/or
arbitration). "Expenses of the action" include but are not limited to the reasonable fees
and costs of witnesses,. consultants, experts, and attorneys. However, anything appearing
to the contrary notwithstanding, the provisions of this Section 16 does not apply to
mediation under Section 17B.
18. Dispute Resolution:
A. Negotiation. The Parties agree to use their best efforts to resolve disputes
and other matters arising out of the planning, design and construction of the Station and
Station Area (including but not limited to the Parking Garage and the Plaza Areas),
arising out of the ongoing administration of the Parking Garage and Plaza Areas
facilities, and arising under this Sublease. If an issue cannot be resolved between Auburn
and Gambini, either of them may invoke a formal conflict resolution process. The first
step in the process is a meeting including Auburn's Property Management Officer and
Harold Gambini or his authorized representatives. If these persons do not resolve the
dispute in a timely manner, the second step in the conflict resolution process shall be a
meeting of Auburn's Supervisor of the Property Management Officer and Harold
Gambini. If these persons do not resolve the dispute in a timely manner the third step in
the conflict resolution process shall be a meeting of Auburn's Mayor and Harold
Gambini. Auburn and Gambini agree to exhaust all .three steps of this negotiation
process before seeking mediation as next described.
Auburn Sound Transit Station Sublease Agreement
City of Auburn -Gambini
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B. Mediation. If the parties do not resolve the dispute in the conflict
resolution process described in Section 17.A, then either party may by written notice to
the other require that the dispute be submitted to mediation. Within fourteen (14) days
after such notice, the parties shall agree on and mutually appoint a mediator. If such
agreement and appointment is not made, then either party may petition the King County
Superior Court to appoint a mediator. Each party shall participate in good faith in the
mediation process -with the appointed mediator. Auburn and Gambini each agree to
participate in good faith in the mediation process with appointed mediator before seeking
redress in a court of law or other tribunal. The costs and fees of the mediator shall be
paid one-half each by Gambini and by Auburn.
19. Miscellaneous Provisions:
A. Non-Discrimination. Neither Gambini nor Auburn shall discriminate
against any person or group of persons on the basis of race, color, sex, creed, national
origin or ancestry in any way related to or arising out of the party's rights or obligations
under this Sublease.
B. Interpretation. The captions of the Articles and Sections of this Sublease
are intended only to assist in reading this Sublease and are not a part of the terms or
provisions of this Sublease nor. shall they be considered in construing or interpreting any
provision of this Sublease. Whenever required by the context of this Sublease, the
singular shall include the plural and the plural shall include the singular. The masculine,
feminine and neuter genders shall each include the other. In any provision relating to the
conduct, acts or omissions of either party to this Sublease, reference to the party shall
also be to the party's agents, employees,. contractors, and successors.
C. Administration. This Agreement shall be administered by
on behalf of Gambini, and by the Mayor of the City of Auburn, or designee, on behalf of
Auburn. Any written notices required by the terms of this Agreement shall be served on
or mailed to the following addresses:
City of Auburn
Auburn City Hall
25 West Main
Auburn, WA 98001-4998
Harold Gambini
P.O. Box 3044
Renton, «rA 98059
(253) 931-3000/Fax (253) 931-3053
Auburn Sound Transit Station Sublease Agreement
City of Auburn -Gambini
Page 12
8120/07
D. Notices. All notices. or communications permitted or required to be given
under this Agreement shall be in writing and shall be deemed to have been duly given if
delivered in person or deposited in the United States mail, postage prepaid, for mailing by
certified mail, return receipt requested, and addressed, if to a party of this Agreement, to
the address for the -party set forth above, or if to a person not a party to this Agreement, to
the address designated by a party to this Agreement. in the foregoing manner. Any party
may change his, her or its address by giving notice in writing, stating his, her or its new
address, to any other party, all pursuant to the procedure set forth in this section of the
Agreement.
L. Recording. This Sublease shall not be recorded without the prior written
consent of both parties. However, promptly after the request of either party, both parties
shall execute, acknowledge, deliver to one another, and record a Memorandum of this
Sublease giving constructive notice of the terms and conditions hereof. The party
requesting such recording shall pay the recording fees thereof.
F. Binding Effect; Governing Law. This Sublease is binding upon the parties
hereto and their respective successors and assigns in interest. However, the preceding
sentence does not permit any assignment in contravention of other provisions of this
Sublease. This Sublease is governed by and shall be construed and enforced according to
the laws of the State of Washington, excluding that State's laws relating to choice of law.
G. Force Majeure. If either party cannot perform any of its obligations due to
events beyond the party's control, the time provided for performing such obligations shall
be extended by a period of time equal to the duration of such events. Events beyond a
party's control include, but are not limited to, acts of God, war, civil commotion, labor
disputes, strikes, fire, flood or other casualty, shortages of labor or material, government
regulation or restriction and weather conditions.
H. Authorized Persons. For the purpose of all provisions of this Sublease that
require Auburn's consent or approval or that require Auburn to consult or agree with
Gambini, the person authorized to act for Auburn in all such matters is Aubunl's Property
Management Officer. For the purpose of all provisions of this Sublease that require
Auburn Sound Transit Station Sublease Agreement
City of Auburn -Gambini
Page 13
8/20/07
Gambini's consent or approval or that require Gambini to consult with or agree with
Auburn, the person authorized to act for Gambini in all such matters is Harold Gambini,
or such person authorized in writing by Harold Gambini. Each party may from time to
time change its authorized person by written notice to the other.
I. Survival. Terms and provisions of this Sublease related to liability and
indemnity obligations shall survive the expiration or earlier termination of this Sublease.
J. Binding Effect. The covenants, obligations and conditions herein
contained shall be binding on and inure to the benefit of the heirs, legal representatives, _
and assigns of the parties hereto.
GAMBINI AUBURN
By: Harold Gambini
Dated:
LLC by Harold Gambini
Managing Partner
Dated:
Auburn Sound Transit Station Sublease Agreement
City of Auburn -Gambini
Page 14
8120/07
By: Peter B. Lewis, Mayor
Dated:
Attested:
Danielle E. Daskam, City Clerk
Approved as to Form:
Daniel B. Held, City Attorney
EXHIBITS
EXHIBIT 1 Resolution 3469 and Lease Agreement between Auburn and Central Puget
Sound Regional Transit Authority, dated June 26, 2002,
EXHIBIT 2 Sublease between Auburn and PMF Enterprises, Inc., dated January 15,
2003,
EXHIBIT 3 Sublease between Auburn and Edward D. Jones, dated April 29, 2004,
EXHIBIT 4 Sublease beriveen Auburn and Green River Community College dated
April 15, 2005.
EXHIBIT 5 Diagram of the 42 designated parking spaces in the Sound Transit parking
garage.
Auburn Sound Transit Station Sublease Agreement
City of Auburn - Gambini
Page 15
8/20/07
STATE OF WASHINGTON
COUNTY OF
ss.
I certify that I know or have satisfactory evidence that is the person who
appeared before me and said person acknowledged that signed this instrument, on
oath stated that was authorized to execute the instrument and acknowledged it as
the of to be the free and voluntary act of such party for
the uses and purposes mentioned in the instrument.
DATED:
STATE OF WASHINGTON
ss.
COUNTY OF
Printed Name:
NOTARY PUBLIC in and for the State of
Washington, residing at
My Commission expires:
I certify that I know or have satisfactory evidence that is the person who
appeared before me and said person acknowledged that signed this instrument, on
oath stated that was authorized to execute the instrument and acknowledged it as
the of to be the free and voluntary act of such party for
the uses and purposes mentioned in the instrument.
DATED:
STATE OF WASHINGTON
COUNTY OF
ss.
Printed Name:
NOTARY PUBLIC in and for the State of
Washington, residing at
My Commission expires:
I certify that I know or have satisfactory evidence that is the person who
appeared before me and said person acknowledged that signed this instrument, on
oath stated that _ was authorized to execute the instrument and acknowledged it as
the of to be the free and voluntary act of such party for
the uses and purposes mentioned in the instrument.
DATED:
Auburn Sound Transit Station Sublease Agreement
City of Auburn - Gambini
Page 16
8/20/07
Printed Name:
NOTARY PUBLIC in and for the State of
Washington, residing at
My Commission expires:
STATE OF WASHINGTON
COUNTY OF
ss.
I certify that I know or have satisfactory evidence that is the person who
appeared before me and said person acknowledged that signed this instrument, on
oath stated that was authorized to execute the instrument and acknowledged it as
the of to be the free and voluntary act of such party for
the uses and purposes mentioned in the instrument.
DATED:
STATE OF WASHINGTON
ss.
Printed Name:
COUNTY OP
NOTARY PUBLIC in and for the State of
Washington, residing at
My Commission expires:
I certify that I know or have satisfactory evidence that is the person who
appeared before me and said person acknowledged that signed this instrument, on
oath stated that was authorized to execute the instrument and acknowledged it as
the of to be the free and voluntary act of such party for
the uses and purposes mentioned in the instrument.
DATED:
Auburn Sound Transit Station Sublease Agreement
City of Auburn - Gambini
Page 17
8/20/07
Printed Name:
NOTARY PUBLIC in and for the State of
Washington, residing at
My Commission expires:
EXHIBIT 1
Resolution #3469 and
Lease Agreement
Between
Auburn and Central Puget Sound
Regional Transit Authority
RESOLUTION NO. 3 4 6 9
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
COUNCIL OF AUBURN, WASHINGTON, AUTHORIZING THE
MAYOR AND CITY CLERK TO EXECUTE A LEASE
AGREEMENT BETWEEN THE CITY OF AUBURN AND THE
CENTRAL PUGET SOUND REGIONAL TRANSIT AUTHORITY
(SOUND TRANSIT).
WHEREAS, the City of Auburn and the Central Puget Sound Regional
Transit Authority (Sound Transit) have been working cooperatively on the
development in utilization of the Sound Transit -Auburn Station, including
parking garage, plaza and retail spaces; and
WHEREAS, corollary to the Station activities, the City and Sound Transit
have cooperated in the construction of-the Aubum Station and Sound Transit
has, on behalf of the City, constructed certain retail spaces available within the
City and over which the City has operational and management responsibilities;
and
WHEREAS, in order to manage and coordinate this retail space, in
cooperation with Sound Transit, the City and Sound Transit have negotiated a
lease acceptable to both parties; and
WHEREAS, it is also appropriate for the lease to address on-going
maintenance and operation responsibilities and relationships between the
City and Sound Transit for the retail space, as a master lease,
accommodating the individual leases into which the City of Auburn would
enter with subtenants; and
Resolution No. 3469
May 14, 2002
Page 1 of 3
WHEREAS, the City Council has heretofor authorized the leasing
arrangements in concept and has allocated resources in support thereof, with
its adoption of Resolution 3278, passed on November 6, 2000; and
WHEREAS, the City also is envisioned to have responsibility for 180
parking spaces in the Sound Transit -Auburn Station, which can be used for
retail parking in the downtown area.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF
AUBURN, WASHINGTON, HEREBY RESOLVES as follows:
..Section 1. The City Council .approves the the lease in substantially
the form as set for in Exhibit "A" between the Central Puget Sound Regional
Transit Authority (Sound Transit) as landlord and the City of Aubum, as tenant,
a copy of which is attached hereto, marked as Exhibit "A" and Incorporated
herein by this reference.
Section 2. That the Mayor and City Clerk are authorized to execute
the lease in substantially the form as set forth in Exhibit "A", and the Mayor is
further authorized to take such other and further actions as are necessary and
convenient for the management space over which the City has .responsibility,
including executing sub-leases with merchants, and managing the 180. parking
spaces in accordance with the City's parking plan.
Section 3. That this resolution shall be in full force and affect upon
passage and signatures hereon.
DATED and SIGNED this Z 4 day of May, 2002.
Resolu~on No, 3469
May 14, 2002
Page 2 of 3
OF AUBU ~~ J
-.
~%"__ .-
_,_..
PE
ATTEST:
i-~~~i~Q.~CU~j'L-.~"
Danielle E. Daskam,
City Clerk
APPR D FORM
I B. Hel ,
City Attorney
ER 8. LEWIS
MAYOR
Resolution No. 3469
May 14, 2002
Page 3 of 3
LEASE
BETWEEN:
CENTRAL PUGET SOUND REGIONAL TRANSIT AUTHORITY
"So.und Transit"
as Landlord
AND
CITY OF AUBURN
"city°
as Tenant
Date of Lease
June 2G, 2002
267865.11
06/26/03
LEASE
Table of Contents
P~
ARTICLE 1 : BASIC TERMS .................:................................................................................2
1.1 Definitions ................................................................................... .........................2
(a) City .................................................................:.:.................. .........................2
(b) City's Parking Spaces .......................................................... .........................2
(c) Commercial Tenant Area .................................................... .........................2
(d) Common Areas .................................................................... ......:..................2
(e) Kiss and Ride Spaces .......................................................... .........................3
(~ Leased Premises ----• ............................................................. .........................3
(g) Other Parking Spaces .......................................................... .........................3
{h) Operating Procedures .......................................................... .........................3
(i) Parking Garage .................................................................... .........................3
~) Plaza .................................................................................... .........................3
~) Plaza Tenant Area ............................................................... .........................3
(1) Sound Transit ...................................................................... .........................3
(m) Station......-----• ...................................................................... .........................3
(n) Term .................................................................................... .... .................3
l .2 Date of Lease .........................................................._.........-•----•-•• --------......---........3
1.3 Landlord ..............................................................................•------. .........................4
1.4 Tenant ......................................................................................... .........................4
1.5 Leased Premises .......................................................................... .........................4
1.6 Lease Term .................................................................................. .........................4
1.7 Permitted Uses ............................................................................ .........................4
1.8 Charges Payable by City ............................................................. .........................4
ARTICLE 2: LEASE, LEASE TERM AND CITY PAYMENTS .................. ._.......................4
2.1 Lease of Property for Initial Lease Term .................................... .........................4
2.2 City's Options to Extend ........................•-••--•-•--.......................... .........................5
2.3 Sound Transit's Work .................................................................. .........................5
2.4 Delivery; Early Occupancy; Delay in Commencement .............. .........................5
2.5 City's Additional Rights ............................:................................. .........................6
(a) Common Areas .................................................................... .........................6
~) Kiss and Ride Spaces .......................................................... .........................6
(c) Other Parking Spaces .......................................................... .........................6
(d) Special Events ..................................................................... .........................6
{e) Elevator Lobby .................................................................... .........................7
(fl Sidewalk Vendors and Kiosks ............................................. .........................8
(g) Plaza Tenant Area ............................................................... .........................8
(h) Vertical Shafts and'Roof Top' Equipment and Devices ..... .........................8
2.6 City's Option To Purchase .......................................................... .........................9
(a) Preliminary Notices ............................................................. .........................9
(b) Determination of Price ........................................................ .........................1Q
-~-
ae~ess i i oana~n2
(c) Notice of Exercise ..........................................................................,.............11
(d) Closing ......................................................:................................................... L 1
(d) Sound Transit's Option .................................................................................13
2.7 Termination; Advance Payments .......................
............................................ . .....14
ARTICLE 3: CHARGES PAYABLE BY CITY ...............:...................................................... 14
3.1 Utilities ..................................................................................... .. 14
3.2 Parking Garage Operations .................................................................................. I S
(a} Sound Transit's Obligations ......................................................................... 15
(b) Costs of Operations ...................................................................................... 1 S
3.3 Insurance Policies ................................................................................................ 15
(a}, Liability Insurance ........................................................................................ 16
(b) Sound Transit's Property Insurance .............................................................. Iti
{c) Other Insurance ............................................................................................ lb
(d) Payment of Premiums .................................................................................. 16
(e) Evidence of Insurance .................................................................................. 17
(f) General Insurance Provisions ....................................................................... 17
3.4 Self-Insurance ...................................................................................................... 18
3.5 Leasehold Excise Tax .......................................................................................... 18
ARTICLE 4: USE OF LEASED PREMISES ..........................................................................18
4.l Permitted iJses ......................................................................... ............................] 8
(a) City's Parking Spaces and Other Parking Spaces ..........:.. ............................18
(b) Commercial Tenant Area ---------------------------------•--•----........ ............................18
4.2 Manner ofUse .......................................................................... ............................18
(a) General ............................................................................. ..... ..18
.. .............
(b) Prohibited Uses ................................................................. ...........................19
(c) Rules .................................•--..........---------............-.-........... ............................19
4.3 Hazardous Materials ................................................................ ................•--.........19
4.4 Signs ..............................•-----...._................................................ ..........:.................19
(a) Permanent Signs ............................................................... ..... .........20
..............
(b} Special Event Temporary Signs ....................................... ............................20
4.S Indemnity ................................................................................. ............................20
4.6 Sound Transit's Access ..................................
.......................... ..20
...........................
4.7 Quiet Possession ...................................................................... ............................21
ARTICLE 5: CONDITION OF LEASED PREMISES; MAINTENANCE,
REPAIRS AND ALTERATIONS .................................................................... 21
S.1 Condition and Suitability of Leased Premises ............................................:........ 21
S.2 Exemption of Sound Transit from Liability ......................................................... 21
S.3 Sound Transit's Obligations to Repair ....................................................:............ 21
5.4 City's Obligations .....................
............................................................................
22
5.5 Alterations, Additions and Improvements .......:................................................... 22
S.6 Condition Upon Termination ............................................................................... 22
ARTICLE 6: DAMAGE OR DESTRUCTION ...:.................................................................... 23
6.1 Partial Damage to Parking Garage ....................................................................... 23
6.2 Substantial or Total Destruction .......................................................................... 23
-ii-
ze~aes i i oeitwoz
6.3 Abatement of Certain Charges; Setoff of Certain Expenses ................................23
6.4 Exceptions ............................................................. ...............................................24
ARTICLE 7 : CONDEMNATION ............................................. ...............................................24
7.1 Permanent Taking ................................................. ..............................................24
(a) General Provisions ........................................ .......................:....................:..24
(b} Allocation of Award ...................................... ...............................................25
7.2 Abatement and Adjustment of Charges Payable b y City .....................................25
7.3 Temporary Taking ............................................... ...............................................25
ARTICLE 8 : ASSIGNMENT AND SUBLETTING ................ ...............................................26
8.1 Subletting .............................................................. ...............................................26
8.2 Assignment ........................................................... ...............................................26
8.3 Release of City ...................................................... ...............................................26
8.4 Requesting Sound Transit's Consent ..................... ...............................................26
8.5 Sound Transit's Right to Information .................... ...............................................27
ARTICLE 9 : BREACH AND REMEDIES ...........:................... ...............................................27
9.1 Time is of the Essence .......................................... ...............................................27
9.2 Default and Breach Defined .................................. ...............................................27
9.3 Sound Transit's Remedies for City's Breach ......... ...............................................27
{a) General Provisions ........................................ .............................................. 27
(b} Termination ................................................... ...............................................28
{c) Remedies Cumulative .................................... ...............................................28
(d) Emergencies .................................................. ...............................................2$
9.4 City's Remedies for Sound Transit's Breach ......... ...............................................28
(a) General Provisions ........................................ ...............................................28
(b) Emergencies .................................................. ...............................................29
9.5 Interest ................................................................... ...............................................29
9.6 Attorneys' Fees and Costs .................
9.7 Dispute Resolution ................................................ ...............................................30
{a) Negotiation .................................................... ...............................................30
(b) Mediation ....................................................... ..................................:............30
ARTICLE 1 0: MISCELLANEOUS PROVISIONS .................. ...............................................30
I0.1 Non-Discrimination .............................................. ...............................................30
10.2 Interpretation ......................................................... ..............................................:30
10.3 Notices .................................................................. .........................................•.....30
10.4 Recording .............:................................................ ...............................................31
10.5 Binding Effect; Governing Law ............................ ...............................................31
10.6 Force Majeure .............................:......................... ...............................................31
10.7 Authorized Persons ............................................... ...............................................31
10.8 Survival ................................................................. ...............................................32
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267863 I I ~ 0686/02
LIST OF EXHIBITS
Exhibit 1.1(b) Commercial Tenant Area and City's Parking Spaces
Exhibit 1.1(e) Station, Parking Garage, Plaza, Plaza Tenant Area and Kiss and Ride
Spaces
Exhibit 1.1{~ Legai Description of Parking Garage and Plaza Property
Exhibit 1.1(i) Parking Garage Operating Procedures
Exhibit 2.3 Plans and Specifications for Sound Transit's Work
Exhibit 2.5(c) Holidays
Exhibit 3.2{b) Parking Garage Operating Costs
Exhibit 4.2{c) Station Rules and Regulations
Exhibit 4.4(d} Exterior Wall Sign Criteria
-iv-
')fi7R65 I I OW2ti/02
RECITALS
A. CENTRAL PUGET SOUND REGIONAL TRANSIT AUTHORITY ("Sound
Transit") is a regional transit authority organized and existing under Chapters 81.104 and 81.112
of the laws of the State of Washington.
B. CITY OF AUBURN {"City"} is a Washington municipal corporation and, in
connection with this Lease, is acting in its. proprietary capacity.
C. King County ("King County") is a Washington municipal corporation.
D. King County operates a mass public transit system in King County, Washington
consisting primarily of buses. Sound Transit operates a high capacity public transit system in
Pierce, King, and Snohomish counties of the State of Washington consisting of buses and
commuter rail and intended to include light rail.
E. In 1999, Sound Transit, King County, and City made that Agreement Between
King County, City Of Auburn, And Central Puget Sound Regional Transit Authority For The
Planning, Design And Construction Of The Auburn Multimodal Transit Facility ("the
Agreement").
F. Pursuant to the Agreement, Sound Transit, King County, and City agreed to
jointly design, provide for the construction, and share the costs of development of a facility in the
downtown part of City to provide the public with facilities for access to and use of the public
transit facilities of Sound Transit and King County ("Station"). City's participation in such
development is intended in major part to further City's goal of rehabilitating its downtown by
acquiring parking spaces and developing space capable of being used for transit oriented retail,
office and dining use.
G. Sound Transit has acquired title or long term lease rights to the land on which the
Station is located and has constructed the Station, including a pazking garage ("Parking Garage")
consisting of 6 floors with 562 parking spaces, 9 of which are designated as disabled parking
spaces. The ground floor of the parking garage has approximately 14,000 gross square feet of
space suitable for use by retail tenants ("Commercial Tenant Area"). Sound Transit has
constructed the Commercial Tenant Area as a "shell" with concrete floor and back wall but no
interior walls. .
H. Pursuant to the Agreement, City contributed to the costs of development of the
Station by making $2,100,000 in improvements to streets in the vicinity of the Station. These
improvements were made to mitigate traffic impacts the Station will have and are properly
considered costs of development of the Station. Pursuant to the Agreement, City contributed
from Transportation Improvement Board and federal grants, an additional $1,802,323 toward the
costs of development of the Station, consisting of $400,000 for planning and approximately
$1,402,323 toward the costs of construction of a pedestrian bridge. The Agreement provided that
in exchange for these contributions, City would be entitled to lease the Commercial Tenant Area
and have exclusive use of 45 of the parking spaces in the Parking Garage.
-1-
267865. I I Oh726/02
I. City has agreed to contribute an additional $2,106,196 to the costs of construction
of the Parking Garage for a total contribution by City of $6,008,519 to costs of dcvclopment of
the Station. In exchange for this additional contribution, Sound Transit has agreed that City
would have (i} the exclusive use of an additional I35 of the parking spaces in the Parking
Garage, (ii) exclusive use of all other parking spaces in the Parking Garage during off-peak
hours, and (iii) other rights as set forth in Section 2.S of this Lease.
this Lease.
By its Motion 2001-84 Sound Transit's Board of Directors authorized entry into
K. By its Resolution No 3278, City authorized entry into this Lease.
THEREFORE, for and in consideration of City's improvements and payments described
in Recital H, City's agreement to make the payments described in Recital H as provided in
Sections 2.3, and City's agreement to make the payments described in Article 3 and Section 5.4,
City's other covenants contained herein, and other good and valuable consideration, the receipt
and sufficiency of which Sound Transit acknowledges, City and Sound Transit make the
following Lease:
ARTICLE 1: BASIC TERMS
This Article 1 contains the Basic Terms of this Lease between the Sound Transit and
City. Other Articles and Sections of the Lease referred to in this Article 1 explain and define the
Basic Terms and are to be read in conjunction with the Basic Terms.
1.1 Definitions: In this Lease, the terms defined in this Section 1.1 have the meanings
specified below unless the context clearly requires otherwise. Other terms are defined in other
Sections of this Lease.
{a) Cam. "City" is defined in Section 1.4.
(b} City's Parkin~Spaces. "City's Parking Spaces" means the 180 parking
spaces that are outlined on the drawings of the ground through the sixth floors of the Parking
Garage attached hereto as Exhibit 1.1(b).
(c} Commercial Tenant Area. "Commercial Tenant Area" means that part of
the interior of the ground floor of the Parking Garage that is outlined and labeled as the
Commercial Tenant Area on the drawing of the ground floor of the Parking Garage that is
attached hereto as part of Exhibit 1.1{b).
{d} Common Areas. "Common Areas" means (i) the driving lanes of the
Parking Garage, (ii) the stairways and elevators of the Parking Garage, (iii) the elevator lobby,
the restrooms on the service corridor and accessible from the elevator Tabby of the Parking
Garage, (iv) the trash area, truck delivery zone, vault room of the Parking Garage and (v) the
Plaza (defined below) except that during the term of any sublease thereof by City those parts of
the Plaza. Tenant Area (defined below) subleased by City as permitted by this Lease shall not be
part of the Common Areas.
-2-
267B6S.11 ON26/02
{e) Kiss and Ride Spaces. "Kiss and Ride Spaces" means those surface
spaces for motor vehicles at the Station north of the Plaza General Area that are outlined and
labeled as the Kiss and Ride Spaces on the copy of the site plan of the Station that is attached
hereto as Exhibit 1.1{e).
(f) Leased Premises. "Leased Premises" is defined in Section 1.5. The legal
description of the Parking Garage and Plaza Property (as defined in Section 2.6) of which the
Leased Premises is a part is as set forth in Exhibit 1.1 (t} attached hereto.
(g) Other Parking Spaces. "Other Parking Spaces" is defined in
Section 2.6(b).
(h) Operating Procedures. "Operating Procedures" means the procedures,
rules and regulations for use of the Parking Garage attached as Exhibit 1.1(i}, and as they may
be changed from time to time by Sound Transit acting in its reasonable discretion after
consultation with City. Each such change shall be effective fifteen (15) days after the changed
Operating Procedures are received in writing by City. No such change shall unreasonably
interfere with City's use of City's Parking Spaces or, as permitted under this Lease, the Other
Parking Spaces.
(i) Parking Garage. "Parking Garage" means the parking garage at the
Station depicted on the copy of the site plan of the Station attached hereto as Exhibit 1.1(e), and
includes, but is not limited to, the Leased Premises.
(j) Plaza. "Plaza "means that part of the Station that is north of the Parking
Garage and is outlined and labeled as the Plaza on the copy of the site plan of the Station that is
attached hereto as Exhibit 1.1(e).
(k) Plaza .Tenant Area. "Plaza Tenant Area" means that part of the Plaza
bounded by the north exterior wall of the Parking Garage, lines extended from and parallel with
the east and west exterior walls of the Parking Garage, and a line thirty feet north of and parallel
to the north exterior wall of the Parking Garage and is outlined and labeled as the Plaza Tenant
Area on the copy of the site plan of the Station that is attached hereto as Exhibit 1.1(e).
(1) Sound Transit. "Sound Transit" is defined in Recital A and Section 1.3.
{m) Station. "Station" is defined in Recital F, is depicted in the drawing
attached hereto as Exhibit 1.1(e) and includes all improvements that are a part of the Station,
including but not limited to the Leased Premises, the Parking Garage, the Plaza, platforms,
surface parking and loading areas, and roads.
(n) Term. "Initial Term," "Extended Term, "Term" and similar phrases are all
defined in Section 1.6.
1.2 Date of Lease: June 26, 2002.
-3-
267865. I 1 Dena/o2
1.3 Landlord: CENTRAL PUGET SOUND REGIONAL TRANSIT
AUTHORITY, a regional transit authority organized under the laws of the State of Washington
{"Sound Transit").
Address of Sound Transit: 401 South Jackson Street, Seattle, WA 98104-2826, which
shall be Sound Transit's address for notice purposes under Section 10.3 unless and until changed
according to the provisions of that Section.
1.4 Tenant: CITY OF AUBURN, a Washington municipal corporation ("City")
Address of City: 25 West Main Street, Auburn, WA 98001-4998, which shall be City's
address for notice purposes under Section 10.3 unless and until changed according to the
provisions of that Section.
1.5 Leased Premises: "Leased Premises" means the Conunercial Tenant Area, the
City's Parking Spaces, and during the term of any sublease thereof by City those parts of the
Plaza Tenant Area subleased by City as permitted by this Lease.
1.6 Lease Term: The "Initial Term" of this Lease is as provided in Section 2.1. City
shall have the option to extend the term of this Lease as set forth in Section 2.2 and "Extended
Term" -means the term of this Lease as so extended from time to time, if and to the extent City
exercises one or mare of such options. In this Lease, the terms "Lease Ternn," "Tenrn," "Term of
this Lease;' and phrases of similar import each means the Initial Term and, to the extent City
exercises its options to extend, the Extended Terms.
1.7 Permitted Uses: See Section 4.1. Notwithstanding any other provision of this
Lease, no use by City, its subtenants or licensees of all or any part of the Leased Premises or any
other part of the Station as to which City has the right to use or the right to grant a Iicense or
other permit to use shall unreasonably interfere with Sound Transit's use of the Station for high
capacity public transit purposes.
1.8 Charges Payable 6y City: See Sections 2.3 (construction costs}, 3.1 (utilities),
3.2 (operating costs), 3.3 (insurance premiums) and 5.4 (repair and maintenance).
ARTICLE 2: LEASE, LEASE TERM AND CITY PAYMENTS
2.1 Lease of Property for lnitial Lease Term. On the terms, conditions and
covenants herein set forth, Sound Transit leases the Leased Premises to City, and City leases the
Leased Premises from Sound Transit, for the Lease Term. The Initial Lease Term is for the
period beginning on the Commencement Date and ending on the earlier of (a) ninety-nine years
thereafter or (b), if applicable, such earlier time as the end of the useful life of the Parking
Garage. The "Commencement Date" is the date on which this Lease has been fully executed by
the City and Sound Transit. When the Commencement Date has been determined, then promptly
after the request of either of them, City and Sound Transit shall mutually execute, acknowledge
and deliver to one another duplicate originals of a written agreement confirming the date which
is the Commencement Date.
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2.2 City's Options to Extend. Provided that at the time each Extended Term would
comrr~ence City is not in material default beyond any applicable period for cure under this Lease,
City shall have the option to extend the Term of this Lease for successive period of ninety-nine
(99) years each. Each of City's Extended Terms, if any, shall begin on the day after the
expiration of the Initial Lease Term or, if applicable, the day after the preceding Extended Term
and shall end on the earlier of (a) ninety-nine years thereafter or (b), if applicable, such earlier
time as the end of the useful life of the Parking Garage. City shall exercise its option to extend
by written notice to Sound Transit given not later than six months before the end of the current
Term. The terms and conditions of this Lease during each Extended Term shall be on all the
same terms and conditions of this Lease as for the Initial Term.
2.3 Sound Transit's Work. Sound Transit has constructed the Parking Garage, its
sidewalks, utilities, and amenities and the Plaza ("Sound Transit's Work") according to the plans
and specifications listed in or otherwise identified according to Exhibit 2.3 attached hereto (the
"Plans" and "Specifications."). Promptly after execution of this Lease Sound Transit shall deliver
to City one copy of "as-built" Specifications and one blueprint copy and one reverse mylar sepia
copy of "as-built" Plans for the Parking Garage and the Plaza. Sound Transit warrants that it has
constructed the Parking Garage and the Plaza according to the Plans and Specifications, in good
and workmanlike manner and in compliance with all applicable laws, ordinances, rules and
regulations of governmental authorities with jurisdiction, including but not limited to City acting
in its governmental capacity. At its sole expense, Sound Transit shall promptly correct (i) alI
material defects in design of the Parking Garage or the Plaza; (ii) all rnatenial defects in materials
and workmanship of Sound Transit's Work and (iii) all failures to conform to the Plans and
Specifications or to governmental requirements therefor, which defects or nonconfottnities are
discovered within one year after the Commencement Date. Sound Transit and City shall each
give the other prompt written notice a8er discovering any such defect or nonconformity. City
shall reimburse Sound Transit $2,106,196 of the costs of construction of the Parking Garage.
Such reimbursement shall be payable in three equal installments of $702,065.33 each, without
interest, as follows: (a) the first installment within thirty (30) days after the Commencement
Date; (b) the second installment one year after the Commencement Date; and (c) the third
installment two years after the Commencement Date.
2.4 Delivery; Early Occupancy; Delay in Commencement.
(a) On the Commencement Date, Sound Transit shall deliver to City, and City
shall take possession of, the Leascd Premises. On or before the Commencement Date, Sound
Transit shall deliver to the City any keys, access codes and operating instructions necessary far
City's access to the Leased Premises.
(b) City was permitted early occupancy of the City's Parking Spaces
beginning on January 28, 2002 and shall pay its forty percent share of utilities and operating
costs of the Parking Garage under Sections 3.1 and 3.2 beginning on that carly occupancy date.
Except for such payments, City shall have no obligation under this Lease to make any payments
of money otherwise required of it under this Lease until the Commencement Datc has occurred
and, upon such occurrence, no payments of money shall be required of City under this Lease on
account of any period of time before the Commencement Date.
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2.5 City's Additional Rights. In addition to the City's rights to the Leased Premises,
the City shall also have, and Sound Transit grants to City, the following rights for the Lease
Term:
(a) Common Areas. City, its licensees and invitees shall have the non-
exclusive right with others designated by Sound Transit to the free use of the Common Areas for
the intended and normal uses of such areas. Sound Transit has the right to change the Common
Areas provided that the change or changes (i) do not interfere with access to or use of the Leased
Premises by City, its subtenants and licensees, and their invitees and contractors and {ii) do not
interfere with exercise of any of City's other rights under this Lease.
(b) Kiss and Ride Spaces. Sound Transit shall not use and shall not permit
others (except City) to use the Kiss and Ride Spaces for parking vehicles or for any use except as
an area for loading and unloading Sound Transit's customers. City may use and may permit
others to use the Kiss and Ride Spaces as parking spaces (i) all day on weekends and holidays
and (ii) Monday through Friday except between the hours of 6:00 a.m. and 9:00 am and 4:00
p.m. and 6:00 p.m. Notwithstanding the preceding, on days when Sound Transit operates one or
more special events trains, City may not use and may not permit others to use the Kiss and Ride
Spaces during the period beginning one hour before the first such special event train is scheduled
to leave the station and ending when the last such special event train actually leaves the Station.
(c) Other Parking Spaces. In addition to City's Parking Spaces, City shall
have the nonexclusive license to use all other parking spaces in the Parking Garage ("Other
Parking Spaces") on a first-come, first-served basis from the following times until the Parking
Garage is closed for the day to use by the public for parking motor vehicles: (i)on those days on
which Sound Transit operates one or more special events trains (for example and not by way of
limitation those operated to offer transit services for sporting events), from the time the last
special events train or other special events transit service operated by Sound Transit of that day
actually leaves the Station; (ii) except as provided in item {i), on week days from the time the last
train or other transit service operated by Sound Transit actually leaves the Station; and
(iii) except as provided in item (i), at all times during Saturdays, Sundays, and holidays.
"Holidays" means those days which are listed on Exhibit 2.5(c). Sound Transit shall provide to
City its schedule of regular Sound Transit trains and all changes to such schedules promptly after
such schedules and changes are available. Sound Transit shall exercise its best efforts to give
City not less than thirty (30) days' prior notice of the schedules for special events trains. City
shall use the Other Parking Spaces consistent with the Operating Procedures. If City charges the
users any fees for use of the Other Parking Spaces, then Sound Transit shall be entitled to ane-
half of City's net revenue from such charges. "City's net revenue" is that. amount, if any, by
which the sums collected exceed (a) all taxes included within such collections (including any
taxes imposed by the City) plus (b} City's out-of-pocket costs incident to use of the Other
Parking Spaces (such as, but not limited to, those of operating and security personnel).
{d) Special Events. City may request the right to use all or a portion of the
Plaza, for itself or third persons for special events. Sound Transit shall grant such right provided
that the requested use is consistent with Sound Transit's reasonable. written policies for public
use. of the Plaza in effect at the time of the request and that the proposed use will not
unreasonably interfere with the use of the Station for public transit purposes. "Special events"
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include but are not limited to street fairs. City shall give Sound Transit not less than thirty (30)
days prior written notice of each special event proposed to be held. in the Plaza. If Sound Transit
determines the special event is inconsistent with its policies or would unreasonably interfere with
Sound Transit's use of the Station for public transit purposes, Sound Transit shall so notify City
not later than seven (7) days after receipt of City's request. At its expense, City shall provide,
perform or cause to be performed all security, maintenance, set up, take-down, appropriate
cleaning and refuse pickup. and all other services required or desired by City and those
reasonably required by Sound Transit for each special event, both during the special event and
promptly after the end of each special event authorized under this Section 2:5(d). Any damage to
the Plaza suffered during such special event shall be repaired by City at its expense unless
(i) caused by Sound Transit or its customers, contractors, invitees or licensees in which case
Sound Transit shall repair such damage at its expense or (ii) caused by an occurrence that is
unrelated to the special event. If City derives any revenue from a special event under this
Section and such revenue exceeds City's costs of the special event, then unless otherwise agreed
Sound Transit shall be entitled to fifty percent (50%) of such excess in exchange for City's use of
the Plaza for such special event. For- such purposes, City's "revenue" means those charges
collected by City from third parties in exchange for use of the Plaza or part thereof during the
special event and does not include derivative benefits such as tax revenues and City's "costs"
includes overhead such as .but not limited to the salaries, wages and benefits paid to City's
emp}oyees reasonably allocable to the amount of time spent by them in connection with the
special event. On Sound Transit's request, City shall permit Sound Transit to inspect and copy
City's books and records related toa special event.
(e) Elevator Lobby. The Commercial Tenant Area includes a room adjacent
(in this Section called "the adjacent room") to the east interior wall (in this Section called "the
interior wall") of the ground floor elevator lobby of the Parking Garage (in this Section called
"the lobby"). The interior wall consists in part of windows through which part of the adjacent
room is visible from the lobby. Access to the adjacent room is by a door in the interior wall.
City intends to use, and to grant licenses to third parties who are governmental agencies or
nonprofit entities to use, a part of the adjacent room to install, maintain, and change from time to
time wall units and floor cases to display photographs, papers, artifacts, and other items of
historical interest and/or to display works of art, which displays may be seen from the lobby
through the windows in the interior wall. To the extent Sound Transit wishes from time to time
to participate in such displays or to add its own historical or art displays in such adjacent room,
City and its licensees will reasonably cooperate with Sound Transit in such matters. City- intends
to sublease or otherwise license to a financial institution the remainder of the adjacent room for
installation, repair, replacement, maintenance and use of an automated teller machine or other
device for persons to electronically conduct banking business. City shall have the right to make,
and the right to permit such a financial institution to make, appropriate openings in the exterior
wall of the Parking Garage and/or in the interior wall for installation of such a machine or
device. So long as City desires to make the uses of the adjacent room that are described in this
paragraph, Sound Transit shall not, and shall not permit anyone else to, obstruct the view through
the windows of the interior wall into the adjacent room or access into the adjacent room through
the door in the interior wall. The preceding sentence does not apply to temporary obstructions
required by routine maintenance or repairs or to any obstructions required by emergency. The
provisions of this Section control over any inconsistency with the provisions of Section 2.5(a).
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(f) Sidewalk Vendors and Kiosks. Sound Transit shall not lease, license or
otherwise grant the right to use any part of the Plaza to any person ("sidewalk vendor") to offer
any goods or services for sale or other distribution to the public from a cart, kiosk, or other
temporary or permanent facility which goods or services are the same or competitive with those
offered for sale or other distribution to the public by any of City's subtenants or licensees of the
Commercial Tenant Area. The preceding does not apply to vending machines for beverages or
snacks or other devices for the sale or free distribution of newspapers or other periodicals. In
addition, the preceding does not apply to leases, licenses or other rights granted to a competing
sidewalk vendor before- the City's sublease was made or license granted ("existing sidewalk
vendor"), but in such cases, Sound Transit shall not renew or extend a competing existing
sidewalk vendor's lease, license or other right during the term of the sublease or license of the
City's subtenant or licensee and, if the lease, license or other right granted by Sound Transit to
the competing existing sidewalk vendor is terminable by Sound Transit without cause and
without payment of money, then Sound Transit shall terminate such Iease, license or other right
according to the terms for such termination. If the competing existing sidewalk vendor's rights
are terminable without cause by Sound Transit but conditioned on Sound Transit's payment of
money, then Sound Transit shall terminate such rights on City's request and City's agreement to
make such payment.
{g) Plaza Tenant Area. City shall have the right to grant its subtenants and
licensees of retail space along the north side of the Parking Garage the right to exclusive use of
that part of the Plaza Tenant Area adjacent to their subleased or licensed premises but only for
use in connection with the business conducted by such subtenant or licensee in such subleased or
licensed premises. Such uses may include, but shall not be limited to, outdoor seating areas for
restaurants and coffee shops and displays of merchandise. Notwithstanding the provisions of the
first sentence of this Section, no use by City's subtenants or licensees shall unreasonably interfere
with, and City's subtenants and licensees shall permit, concurrent use of the Plaza Tenant Area
by the public for pedestrian access in, about, and through the Plaza. In addition, the provisions
of this Section are applicable for the limited term of ten {10) years beginning with the
commencement date of this Lease. Beginning six (6) months before the end of-such limited
term, City and Sound Transit shall negotiate in good faith concerning the terms and conditions
on which such limited term shall be extended. Sound Transit shall not unreasonably refuse or
condition such extension.
{h) Vertical Shafts and "Roof Top" Equipment and Devices. With Sound
Transit's prior approval as to purpose, location, plans and specifications, City's subtenants of all
or part of the Commercial Tenant Area may install in existing (and any future) vertical shafts in
the Parking Garage and on any of the second through the top floors of the Parking Garage
mechanical equipment, antennae and other devices for venting odors and smoke from space in
the Commercial Tenant Area or for communications and electronic data-transfer, including
cables, ducts, filters, fans and other appropriate associated items to enable use of such equipment
or devices in the space rented by them in the Commercial Tenant Area and for use in connection
with the subtenant's primary business or other operations conducted in such space (so long as
such primary business is not provision of telecommunications services). Sound Transit shall not
unreasonably refuse, condition or delay such approval but may consider, among other things: (i)
whether use of the proposed equipment or devices for communications or data-transfer purposes
would interfere with any of Sound Transit's similar equipment at the Station; (ii) whether the
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proposed location, plans and specifications provide reasonable enclosures or screening from
view for aesthetic purposes and for noise suppression and safety; (iii) whether such equipment or
devices would unreasonably interfere with the primary use of the floor of the Parking Garage for
motor vehicle parking; and (iv) and the manner in which such equipment or devices (and
associated screening or enclosures} are to be attached to the structure of the Parking Garage.
With regard to subpart (iii), such use shall not be considered to unreasonably interfere merely
because one or more parking spaces are lost to such equipment, devices or associated screening
or enclosures if the spaces lost are some of City's Parking Spaces or, if not, City permits Sound
Transit to use without charge the same number of City's Parking Spaces as are lost while such
equipment or other devices and any associated screening or enclosures are in place. If Sound
Transit's approval is granted to installation and use of any such equipment or devices, City's
subtenants shall: (v} obtain all necessary permits for installation thereof and otherwise conform
to al] requirements of Law for installation and use thereof; (vi) maintain, service, repair and
replace such equipment or other devices and any associated screening and enclosures so that they
are at all times in good working order; (vii) at the end of the term of the subtenant's sublease of
its space in the Commercial Tenant Area, remove the equipment or devices and all associated
screening, .enclosures and other things installed in connection therewith and restore all affected
parts of the Parking Garage as reasonably as practical to the condition immediately before such
installation; and (viii) pay when due all costs of the foregoing. City shall be responsible for such
removal and restoration if City's subtenant fails to do so when required.
2.6 City's Option To Purchase. If at any time during the term of this Lease {as it
may be extended) Sound Transit decides to cease using. the Station .for public .transit purposes
and its governing body authorizes disposition of the Parking Garage and Plaza, then City shall
have the option to purchase the Parking Garage and the Plaza, the real property on which such
improvements are located, and all other improvements located on, in or over such real property
(in this Section 2.6 collectively called "the Parking Garage and Plaza Property" and legally
described in Exhibit 1.1(f) attached hereto) on the terms and conditions specified in this Section
2.6 ("City's Option"). If City's Option is exercised, then the purchase price for the Parking
Garage and the Plaza shall be the fair market value of the Parking Garage and Plaza Property as
encumbered by the City's interest in such property under this Lease as such fair market value is
determined in accordance with subsection {b) of this Section 2.6. City's Option expires when the ,
Term of this Lease expires unless before then by appropriate action of Sound Transit's governing
body Sound Transit decides to cease such use of the Station and to dispose of its interest in the
Parking Garage and Plaza Property. If such action is taken before expiration of the Term of this
Lease, then City's Option survives such expiration, subject however to the time limits specified
in this Section 2.6.
(a) Preliminary Notices. Promptly after Sound Transit's governing body
decides to cease use of the Station for public transit purposes and to dispose of the Parking
Garage and Plaza Property, Sound Transit shall give City written notice of Sound Transit's
decision and the anticipated date that such use will cease ("Sound Transit's Cessation Notice").
Within sixty (60} days after receiving Sound Transit's Cessation Notice, City shall give Sound
Transit written notice of City's preliminary intention to exercise its option to purchase the
Parking Garage and Plaza Property ("City's Notice of Intent"). if City's Notice of Intent is not
timely given, then City's Option shall expire.
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2G~8G5.11 UG/2G/U2
(b) Determination of Price. If City's Notice of Intent is timely given, then the
purchase price for the Parking Garage and Plaza Property pursuant to City's Option, if exercised,
shall be determined as provided in this Section 2.6(b}.
(1) During the period of forty-five (45) days beginning with the day
after City's Notice of Intent is given, City and Sound Transit shall negotiate in good faith in an
effort to agree in writing upon the amount of the purchase price. If agreement is not made in
writing within such forty-five day period, then the fair market value of the Parking Garage and
Plaza Property as encumbered by City's interest in such property under this Lease shall be
determined as provided in Section 2.6(b)(2) and the purchase price for Parking Garage and Plaza
Property pursuant to City's Option, if exercised, shall be that amount that is equal to such fair
market value.
(2} Within sixty (60) days after City's Notice of Intent is given, each of
City and Sound Transit shall select an appraiser and the two appraisers shall independently
determine and make their written report to each other and to each of City and Sound Transit of
the appraiser's opinion of the fair market value of the Parking Garage and Plaza Property as
encumbered by City's interest in-such property under this Lease. If within ten {10) days after the
last of such reports is delivered, the two appraisers agree on such fair market value, then the two
appraisers shall report such agreement in writing to City and Sound Transit and the fair market
value of the Parking Garage and Plaza Property as so encumbered shall be the sum so agreed. If
the two appraisers do not so agree within such period and if their written opinions of such value
are within five percent of the lowest of them, then the fair market value of the Parking Garage
and Plaza Property as so encumbered shall be that amount determined by adding the two
opinions together and then dividing by two. If the two appraisers' opinions are not within such
five percent tolerance then within twenty (20) days after the last of their reports were delivered to
City and Sound Transit, these two appraisers shall select a third appraiser who shall
independently {but with the benefit of the reports of the first two appraisers) determine and make
its written report to each of City and Sound Transit of the third appraiser's opinion of the fair
market value of the Pazking Garage and Plaza Property as so encumbered, in which case such
fair market value shall be that amount determined by the third appraiser except that such fair
market value shall not be greater than the highest, nor lower than the lowest, of the fair market
value as determined by the two appraisers first selected under this Section 2.6(2).
(i) If City does not select an appraiser, if Sound Transit does
not select an appraiser or if the first two appraisers do not select a third, all as required and by the
time specified in Section 2.6(b)(2), then on application the appraiser may be selected by the then
president of the chapter of the American Institute of Appraisers (or its successor organization}
whose area includes King County, Washington or on such person's failure to act within ten (10)
days after the application, by the superior court of King County, Washington. If the failure of
selection is by City, the application for appointment may be made by Sound Transit. If the
failure of selection is by Sound Transit, the application for appointment may be made by City. If
the failure of selection is by the first two appraisers, then the application for appointment may be
made by either or both of City and Sound Transit.
(ii) All appraisers selected or appointed under Section Z.6(b}(2)
shall deliver their written reports not later than thirty (30) days after their respective selection or
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appointment. All appraisers selected or appointed under Section 2.6(b)(2) shall have been a
member of the American Institute of Appraisers (or its successor organization) for not less than
the period of fifteen (15) years preceding selection or appointment and regularly (not necessarily
exclusively) engaged in the profession of appraising the fair market value of iinptoved
commercial real property in King County, Washington for not less than the period of ten (10)
years Preceding selection or appointment.
(iii) City shall pay the costs and fees of the appraiser selected
by or appointed for it and, if a third appraiser is appointed, one-half the fees and costs of the third
appraiser. Sound Transit shall pay the costs and fees of the appraiser selected by or appointed
for it and, if a third appraiser is appointed, one-half the fees and costs of the third appraiser. City
and Sound Transit shall bear their own costs and fees, including those of attorneys, witnesses,
and consultants of any application made for appointment of an appraiser under Section
2.6(b}(2)(i).
If agreed according to subpart (1) of Section 2.6(b}, the purchase price as so agreed for the
Parking Garage and Plaza Property is binding and conclusive on City and Sound Transit and all
other persons having any interest in the premises. If determined according to subpart (2} of this
Section 2.6(b), the fair rnazket value of the Parking Garage and Plaza Property as encumbered by
the City's interest in such property under this Lease as so determined and the purchase price
being equal to such value as provided in Section 2.6(a), are binding. and conclusive on City and
Sound Transit and all other persons having any interest in the premises.
(c) Notice of Exercise. City may exercise City's Option by written notice to
Sound Transit ("City's Notice of Exercise") given not later than sixty (60} days after the purchase
price of the Parking Garage and Plaza Property has been agreed or determined as provided in
Section 2.6(b). If City's Notice of Exercise is not timely given then City's Option shall expire.
(d) Closing. If City's Notice of Exercise is timely given, then the purchase and
sale of the Parking Garage and Plaza Property shall be closed as provided in this Section 2.6(d).
(1) The purchase and sate of the Parking Garage and Plaza Property
shall be closed in escrow with the title company selected by City as provided in subpart (4) of
this Section 2.6(d) acting as the escrow agent at such title company's office in (and, if none,
nearest to) downtown Seattle, Washington. Closing shall occur on the later of (i) sixty (60) days
after City's Notice of Exercise is given or (ii) thirty (30) days after any required segregation
under subpart (7) of this Section 2.6(d) is accomplished.
(2) At closing, City shall pay the purchase price of the Parking Garage
and Plaza Property in full, in cash and Sound Transit shall deliver to City a statutory warranty
deed for the Parking Garage and Plaza Property conveying such property to City free and clear of
all encumbrances, claims, defects, liens and other defects in title except: (i) those of City's
subtenants and licensees, if any; (ii) utility and other easements that do not materially interfere
with use of the Parking Garage and Plaza Property; and (iii) rights reserved in federal patents or
state deeds.
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(3) At closing, the following shall be prorated and adjusted between
the parties as of the date of closing; (i) Sound Transit's share under the terms of this Lease of the
charges for utilities and operating costs of the Parking Garage and Plaza; (ii) rents and other
charges payable by third parties to Sound Transit for use of parking spaces in or any other part of
the Parking Garage (except the Leased Premises); and (iii) sums payable under agreements that
are assigned to City as provided in Section 2.6{d){6).
(4) At closing, Sound Transit shall provide and pay for an extended
form of owner's policy of title insurance insuring City as the owner of the Parking Garage and
Plaza Property with no exceptions other than those provided in subpart (2) of this Section 2.6(d)
and such other exceptions and exclusions as are included in the title company's printed form of
policy jacket. The policy limits of such policy shall be equal to the purchase price to be paid by
City for the Parking Garage and Plaza Property. The title policy shall be issued by such title
insurance company as City selects in its discretion.
(5) City shall pay the following costs of the closing: the costs of
recording the deed, one-half the title company's fees and costs for acting as escrow agent, and, if
applicable, City's net share of the prorations described in subpart {3} of this Section 2.6(d).
Sound Transit shall pay the following costs of the closing: the title company's premium for the
title policy described in subpart (4} of this Section 2.6(d), one-half the title company's fees and
costs of acting as escrow agent, and, if applicable, Sound Transit's net share of the prorations
described: in subpart (3) of this Section 2.b(e) and-the costs of any survey required by the title
company as a condition to issuing the extended form of owner's policy of title insurance.
(6) At closing, Sound Transit shall terminate all licenses, permits,
Leases, andother contracts with third parties to provide services to the Parking Garage and Plaza
Property or to use. any part of such Property except the Leased Premises (in this Section 2.6(d)
collectively, "agreements") that are terminable without cause and without payment of money,
except any that City elects to have assigned to City at closing. At closing, Sound Transit shall
assign to City such agreements that City elects to have assigned to it under the preceding
sentence and such other agreements that are not terminable without cause and without payment
of money, .and City shall assume and agree to perform (and .indemnify and defend Sound Transit
against claims and liabilities on account of or arising from) Sound Transit's obligations under the
agreements that are assigned to City to the extent such obligations first accrue on and after the
date of closing. Sound Transit shall perform (and indemnify and defend City against claims and
liabilities on account of or arising from) the obligations in connection with such agreements to
the extent such obligations accrue before the date of closing. At closing, Sound Transit shall
deliver to City copies of all agreements assigned to City under this subpart (including but not
limited to all amendments and modifications thereof) and of all Sound Transit's records relating
thereto. The assignments and assumptions described in this subpart shall be in form and
substance reasonably satisfactory to City, Sound Transit and their respective legal counsel.
(7) If a short plat, boundary adjustment or other subdivision or
segregation of the Parking Garage and Plaza Property is required in order for such property to be
legally conveyed to City, then the parties shall cooperate with one another in order to accomplish
such segregation as promptly as practical after City's Notice of Exercise. is given. City and
Sound Transit shall each pay one half the fees and costs of such segregation, including but not
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limited to those of engineers, surveyors and other professionals engaged to accomplish the
segregation and the usual fees of the applicable governmental authorities with jurisdiction
(including but not limited to City) incident to applying for, processing, and accomplishing such
segregation. If a survey is reasonably required in order to prepare an accurate legal description
of the Parking Garage and Plaza Property, then Sound Transit, after consultation with City, shall
select the surveyor and City and Sound Transit shall each pay one-half the fees and costs of the
surveyor for making such survey and preparing such description. If the title company requires a
survey as a condition to its willingness to issue an extended farm of owner's policy of title
insurance, then Sound Transit shall pay the costs of such survey or, as applicable, the additional
costs required to upgrade any survey otherwise provided in this subpart (7} to the standards
required by the title company as a condition to issuing such extended farm of owner's policy.
(e) Sound Transit's Option. If City has but does not exercise City's Option, then
Sound Transit shall have the option ("Sound Transit's Option") to purchase City's leasehold
interest under this Lease in the Parking Garage and Plaza Property {"City's Leasehold Interest ")
for a purchase price equal to the fair market value of City's Leasehold Interest. Such fair market
value shall be determined in the manner and within the time periods specified in Section 2.6(b)
for the purposes of determine the fair market value of the Parking Garage and Plaza Property as
encumbered by the City's interest in such property under this Lease. Sound Transit shall give
City written notice of Sound Transit's preliminary intention ("Sound Transit's Notice of Intent")
to exercise Sound Transit's Option not later than sixty (60) days after the earliest of the following
to occur: (i) the time for City to timely give City's Notice of Intent under Section 2.6 (a) expires
without such notice having been given; or (ii) the time far City to timely give City's Notice of
Exercise under Section 2.6(c) expires without such notice having. been given. If Sound Transit's
Notice of Intent is timely given, Sound Transit may exercise Sound Transit's Option by written
notice to City ("Sound Transit's No#icc of Exercise") given not later than sixty (60) days after the
fair market value of City's Leasehold Interest has been determined. Sound Transit's°Option shall
expire on the earlier of the following to occur: (i) Sound Transi# does not timely give Sound
Transit's Notice of Intent; or (ii} Sound Transit does not timely give Sotmd Transit's Notice of
Exercise. If Sound Transit exercises Sound Transit's Option, then Sound Transit's purchase of
City's Leasehold Interest shall be closed as follows:
(1) Closing shall occur on or before sixty (b0} days after Sound Transit's
Notice of Exercise is given.
(2) At closing, Sound Transit shall pay the purchase price of City's
Leasehold Interest in full, in cash and City shall execute and deliver to Sound Transit an
assignment thereof. Such assignment shall be in form reasonably acceptable to Sound Transit
and shall be sufficient for Sound Transit to obtain an owner's standard policy of title insurance
for the Parking Garage and Plaza Property staving no exception for City's Leasehold Interest (but
subject to any agreements assigned to Sound Transit as provided in the next subpart).
(3) At closing, City shall terminate all subleases, licenses, permits, leases,
and other contracts with third parties to provide services to or use all or any part of the Leased.
Premises {in this Section 2.6(e) collectively, "agreements") that are terminable without cause and
without payment of money, except any that Sound Transit elects to have assigned to Sound
Transit at closing. At closing, City shall assign to Sound Transit such agreements that Sound
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261865.1 1 06/202
Transit elects to have assigned to it under the preceding sentence and such other agreements that
are not terminable without cause and without payment of money, and Sound Transit shall assume
and agree to perform (and indemnify and defend City against claims and liabilities on account of
or arising from} City's obligations under the agreements that are assigned to Sound Transit to the
extent such obligations first accrue on and after the data of closing. City shall perform (and
indemnify and defend Sound Transit against claims and liabilities on account of or arising from)
the obligations in connection with such agreements to the extent such obligations accrue before
the date of closing. At closing, City shall deliver to Sound Transit copies of all agreements
assigned to Sound Transit under this subpart (including but not limited to all amendments and
modifications thereof) and of all City's records relating thereto. In addition, at closing, City shall
deliver to Sound Transit fully executed estoppel certificates from each subtenant, licensee or
pennittee of an agreement that is assigned to Sound Transit as provided in this subpart. The
assignments, assumptions, and estoppel certificates described in this subpart shall be in form and
substance reasonably satisfactory to City, Sound Transit and their respective legal counsel;
provided, however, the estoppel certificates shall not require the subtenant, licensee or pei-mittee
from stating as fact any matter as to which such person does not have knowledge.
(4) At closing, the following shall be prorated and adjusted between the
parties as of the date of closing: (i) City's share under the terms of this Lease of the charges for
utilities and operating costs of the Parking Garage and Plaza; (ii) rents and other charges payable
by third parties to City under any sublease, license or permit for use. of all or any part of City's
Parking Spaces or for use of all or any part of the Commercial Tenant Area or Plaza Tenant
Area; and (iii) sums payable under agreements that are assigned to Sound Transit as provided in
Section 2.6(e)(3). In addition, City shall at closing deliver to Sound Transit (or, at Sound
Transit's option) allow as a credit against the purchase price of City's Leasehold Interest, the
amount, if any, of any security or other deposits from third parties held by City under any
sublease, license, or permit affecting all or any part of the Commercial Tenant Area or City's
Parking Spaces_
2.7 Termination; Advance Payments. Upon expiration or termination of this Lease
under any provision of this Lease or of law (including but not limited to closing of City's
purchase under Section 2.6), Sound Transit shall refund or credit to City any advance payments
made by City under this Lease that are applicable or attributable to any period of time after the
effective date of expiration or termination, excluding payments made under Section 2.3.
ARTICLE 3: CHARGES PAYABLE BY CITY
3.1 Utilities. City shall pay, or cause its subtenants and licensees to pay when due,
directly to the appropriate supplier, the cost of all natural gas, heat, light, power, sewer service,
water, refuse disposal and other utilities supplied to the Commercial Tenant Area. Sound Transit
shall cause such services to be separately metered or otherwise separately charged to such Area.
City may install or cause the service providers to install additional meters or other devices to
monitor usage so that charges for the services consumed by City's individual subtenants and
licensees may be billed directly to or properly allocated among them. Sound Transit shall pay
when due the costs of natural gas, heat, light, power, sewer service, water, refuse disposal and
other utilities provided to the remainder of the Parking Garage and the Station (including but not
limited to those in the Plaza during a special event but excluding those utilities provided to the
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Commercial Tenant Area). City shall reimburse Sound Transit forty percent (40%) of the costs
of such utilities and services to the Parking Garage within sixty (60} days after receipt of Sound
Transit's invoice therefor, which invoice shall be accompanied. by copies of the. underlying
billings from the providers. Sound Transit shall render such invoices regularly and, in any case,
not less frequently than once each three months.
3.2 Parking Garage Operations.
(a) Sound Transit's Obligations. In consultation with the City, Sound Transit
shall operate the Parking Garage (except the Commercial Tenant Area) consistent with Sound
Transit Operating Procedures and during Sound Transit Operating Hours only. Such operations
shall include, but not be limited to establishing and observing procedures, installing and
maintaining signs, markings and devices, employing such personnel and/or contracting with such
third party providers, and supervising the performance of such employees and contractors all as
are reasonably intended to provide security for the Parking Garage and users thereof and
maintain a clean and safe environment. For the purpose of this Section 3.2(a) and Section 3.2(b),
"City's Parking Spaces" include the Other Parking Spaces during those periods that City is
entitled to use of the Other Parking Spaces under Section 2.5(a). At its election from time to
time, City may notify Sound Transit that it wishes to extend the operating hours of the Parking
Garage by either or both opening the Parking Garage earlier or closing the Parking Garage later,
than Sound Transit Operating Hours. In such event, the City shall notify Sound Transit no less
than 14 days in advance and .Sound Transit will arrange with its staff or contractors to operate
and provide security' for the Parking Garage during the requested time. period, except that, with
Sound Transit's prior approval as to the appropriate Ievel of security, -City may provide security
during the extended hours through hiring commissioned police officers. ~ Sound Transit shall
have no liability to City for damages, losses or personal injury that occur during times that are
not Sound Transit Operating Hours, including but not limited to during extended operating hours
requested by City.
{b) Costs of Operations. Sound Transit shall pay when due the costs of
operating the Parking Garage, including but not limited to the costs of the measures, personnel,
and contractors described in Section 3.2(a) and as further detailed in Exhibit 3.2(b). For
employees of Sound Transit, such costs include those for benefits. City shall reimburse Sound
Transit forty percent (40%) of such costs allocable to Sound Transit's Operating Hours, and one
hundred percent {100%) of such costs allocable to extended hours requested by City. Such
payment shall be made within sixty (60) days after receipt of Sound Transit's invoice therefor,
which invoice shall be accompanied by a statement in reasonable detail of the amount and
purpose of each of the various items of cost, copies of any underlying billings from third parties
and other reasonable evidence of the amount, purpose and allocation between Sound Transit and
City of the variaus items of cost. Sound Transit shall render such invoices regularly and, in any
case, not less frequently than once each three months. City shall have the right on demand to
inspect and copy Sound Transit's books and records concerning operation of the Parking Garage
and, if applicable, the hooks and records of any third party contractor engaged by Sound Transit
to provide goods or services in connection with operation of the Parking Garage and City's
Parking Spaces.
3.3 Insurance Policies.
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(a) Liability Insurance. At all limes during the Lease Term, at its expense
City shall maintain a policy of liability insurance insuring City against liability for bodily injury,
property damage (including loss of use of property) and personal injury arising out of the
operation, use or occupancy of the Leased Premises and the Other Parking Spaces. City shall
name Sound Transit as an additional insured under such policy. The initial amount of such
insurance shall be in the City's discretion but not less than Two Million Dollars ($2,000,000) per
occurrence.- Not less frequently than every five years, the parties shall review such minimum
coverage for possible increase based upon inflation, increased liability awards, recommendation
of City's and of Sound Transit's professional insurance advisers and other relevant factors. Any
such agreed increase shall be evidenced by the parties executing and delivering to each other
duplicate originals of a writing specifying the newly agreed minimum coverage. Neither party
shall unreasonably refuse to agree to an increase in such minimum coverage. The liability
insurance obtained by City under this Section 3.3{a) shall {i) be primary and non-contributing
with Sound Transit's liability insurance policies; (ii) contain cross-liability endorsements; and
(iii) insure Sound Transit against City's performance under Section 4.5, if the matters giving rise
to the indemnify under Section 4.5 result from the negligence of City; and {iv) contain a
contractual liability endorsement. At its expense, Sound Transit may also obtain liability
insurance, in an amount and with coverage determined by Sound Transit, insuring Sound Transit
against liability arising out of ownership, operation, use or occupancy of the Station, including
but not limited to the Parking Garage and the Leased Premises.
(b) Sound Transit's Property Insurance. At all times during the Lease Term,
Sound .Transit shall maintain a policy of property insurance covering loss of or damage to the
Forking Garage, including the Leased Premises, in the full amount of its then current
replacement cost without deduction for depreciation. Such policy shall provide protection
against all perils included within the classification of "all risk," including but not limited to fire,
extended coverage, vandalism, malicious mischief, special extended perils, sprinkler leakage and
any other perils which Sound Transit deems reasonably necessary after consultation with City.
Sound Transit shall have the right to obtain flood and earthquake insurance. Sound Transit shall
not obtain insurance for fixtures or equipment or improvements installed by City, its subtenants
or licensees in the Commercial Tenant Area or any other property of City, its subtenants or
licensees located in or about the Station. City, its subtenants and licensees shall maintain
policies of insurance covering loss of or damage to their respective fixtures, equipment,
improvements, and/or other property installed in or located in or about in the Station, including
the Leased Premises.. At its expense, City may also maintain a policy of insurance covering loss
of or damage to those parts of the Parking Garage that City is obligated to repair or replace under
Section 5.4 of this Lease. Neither party shall do or permit anything to be done in or about the
Station that would invalidate any of the other party's insurance policies described in this
Section 3.3{b}.
(c) Other Insurance. Each party may, at its respective expense, maintain such
other insurance for its own purposes or benefit, as it desires from time to lime.
(d) Payment of Premiums. City shall pay all premiums for the insurance
policies described in Sections 3.3(a) through 3.3(c} that City is to or may obtain. Sound Transit
shall pay all premiums for the insurance policies described in Sections 3.3(a) through 3.3(c) that
Sound Transit is to or may obtain. City shall reimburse Sound Transit forty percent (40%) of the
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premiums for the property insurance described in Section 3.3(b} on the Parking Garage obtained
by Sound Transit (including any flood or earthquake coverage). Such reimbursement shall be
paid within sixty (60) days after City's receipt of Sound Transit's invoice therefor which shall be
accompanied by a copy of the premium statement or other evidence of the amount due. If such
property policy maintained by Sound Transit also covers other improvements on real property in
addition to the Parking Garage (whether located in the Station or elsewhere), Sound Transit shall
allocate the premiums of such policy between the Parking Garage and such other improvements
on a fair and reasonable basis and, concurrently with delivery to City of Sound Transit's invoice
and a copy of the premium statement described in this Section, Sound Transit shall also deliver
to City a written statement showing in reasonable detail the basis upon which such allocations
were made, and City`s share of the premium calculated.
(e) Evidence of Insurance. Promptly after the request of the other party, each
party shall deliver to the other a copy of each policy of insurance which the party is required to
maintain under this Section 3.3. As an alternative to providing a copy of any or all of such
policies, each party shall have the right to provide the other a certificate of insurance,. executed
by an authorized officer of the insurance company, showing that the required insurance is in full
force and effect.
(~
General Insurance Provisions.
(1) Any insurance which each party is required to maintain under this
Lease shall include a provision which requires the insurance carrier to give the other party not
less than thirty (30} days' written notice before the effective date of any cancellation (including
but not limited to cancellation for nonpayment of premium) or modification of such coverage.
(2) If either party fails to obtain and continuously maintain any policy
of insurance required of it, the other party may obtain such insurance, in which case the party in
default shall reimburse the other for the cost of such insurance within thirty (30) days after
receipt of an invoice therefor accompanied by a copy of the premium statement or other evidence
of the cost of such insurancc.
(3) The parties acknowledge insurance markets change and that
insurance in the form and amounts described in this Section 3.3 may not be available in the
future. If at any time during the Lease Term the precise form of any policy required under this
Section 3.3 is not available because. of any change in insurance markets, the party required to
obtain such policy shall nevertheless maintain insurance coverage that is customary and
commercially reasonable in the insurance industry and as nearly the same as (or better than) that
required under this Section 3.3.
(Q) Unless prohibited under the applicable insurance policy, each party
hereby releases and waives any and all rights of recovery against the other (and their respective
officials, officers, employees, agents and representatives), for loss of or damage to its property or
the property of others under its control, if such loss or damage is covered by any insurance policy
in force (whether or not described in this Lease) at the time of such loss or damage or would
have been covered if the party had obtained the insurance it was required to obtain under this
Section 3.3. Upon obtaining the policies of insurance required or permitted in this Section 3.3,
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2G78GS. n 06/26/82
the parties shall give notice to their respective insurance carriers of this mutual release and
waiver of subrogation and use reasonable efforts, including payment of any additional premium,
to cause their respective insurance carriers to consent to the provisions of this subpart.
Notwithstanding the preceding, the release and waiver in this subpart shall not be effective if the
effect would be to void coverage under the policy.
3.4 Self-hasurance. Any party to this lease, which is a municipal government, a
regional transit authority or other governmental authority, has the right to self-insure (either
alone or jointly with other like or similar entities) under any one or more of the .preceding
provisions of this Article 3. However, if a party elects to self-insure, then for the purposes of this
Lease it shall be obligated under all provisions of this Lease as if it had obtained the relevant
policy or policies as described in this Article 3 from an insurance company. Without limiting the
generality of the preceding sentence: (i) a party who elects to self-insure with respect to property
damage shall be considered to have obtained a policy that does not prohibit the release and
waiver of Section 3.4(iv) and such release and waiver shall be fully effective; and (ii) if Sound
Transit elects to self-insure the risks that would otherwise be covered by the property insurance
on the Parking Garage described in Section 3.3(b), then (A) City has no obligation to pay to
Sound Transit any sums under Section 3.3(d) on account of premiums for such coverage and
(B) Sound Transit is liable to City for what would have been City's share of the proceeds of such
a policy under Sections 5.3 and 6.4.
3.5 Leasehold Excise Tax. City shall comply with any obligations imposed upon
City under the provisions of Chapter 82.29A, Revised Code of Washington (and any
amendments or replacements thereof) concerning leasehold excise taxes payable, if any, by
City's subtenants and licensees of the Commercial Tenant Area arising from such subleases or
licenses.
ARTICLE 4: USE OF LEASED PREMISES
4.1 Permitted Uses. Subject to the provisions of Section 4.2 and this Section:
(a) City's Parking Spaces and Other Parking Spaces. City, its subtenants and
licensees shall use the City's Parking Spaces and, when permitted under Section 2.5(a), the Other
Parking Spaces and the Kiss and Ride Spaces only for the temporary parking of motor vehicles.
No overnight parking shall be permitted in the Other Parking Spaces or Kiss and Ride Spaces.
(b) Commercial Tenant Area. Subject to the provisions of Section 4.1(c),
City, its subtenants and licensees may use the Commercial Tenant Area for general o#fice, retail,
and/or dining purposes.
4.2 Manger of Use.
(a) General. City shall not cause or permit any part of the Leased Premises or
the Other Parking Spaces to be used in any way that constitutes a violation of any law,
ordinance, or governmental regulation or order or that constitutes a nuisance or waste. City or its
various subtenants or licensees shall obtain and pay for all permits, including but not limited to
one or more certificates of occupancy, required for occupancy and use of the Commercial Tenant
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267865. I I D626/02
Area. City shall promptly take, or cause its subtenants or licensees to promptly take, all actions
necessary to comply with all applicable statutes, ordinances, rules, regulations, orders,
requirements and permits regulating their respective use of any part of the Leased Premises
under lease, sublease, license or permit from the City.
(b) Prohibited Uses. No portion of the Leased Premises may be used as an
adult bookstore or videostore, "headshop", for the sale of weapons, for the sale of fortified
wines, as a tavern, as office space for a bail bondsman, or for the sale of alcoholic beverages
except when sold for consumption off the premises or for consumption on the premises in
connection with a dining establishment which derives at least fifty percent (50%) of its gross
revenue from the sale of food and beverages other than alcoholic beverages.
(c) Rules. City, its subtenants, licensees and invitees shall abide by the
reasonable rules and regulations established from time to time by Sound Transit for the safety,
care, cleanliness and good order in and about the Station. However, except as provided in the
next sentence, no such rule or regulation is binding upon City, its subtenants, licensees and
invitees until fifteen (15) days after a written copy thereof is delivered to City and no such rule is
binding upon City, its subtenants, licensees and invitees to the extent the rule or regulation is
inconsistent with, or unreasonably interferes with the exercise of, City's rights under this Lease.
Rules and regulations established by Sound Transit to address emergency situations shall become
effective immediately. A copy of Sound Transit's rules and regulations in effect on the
Commencement Date, if any, is attached hereto as Exhibit 4.2(c)_
4.3 Hazardous Materials. As used in this Lease, the term "Hazardous Material"
means any radioactive materials, hazardous or toxic substances, material or waste or related
materials, including any substances defined as or included in the definition of "hazardous
substances", "hazardous wastes", "hazardous materials" or "toxic substances" now or
subsequently regulated under any applicable federal, state or local laws or regulations, including
but notlimited to petroleum-based products, paints, solvents, lead, cyanide, DDT, printing inks,
acids, pesticides, annmonia compounds and other chemical products, asbestos, and PCBs. City
shall not cause or permit any Hazardous Material to be generated, produced, brought upon, used,
stored, treated or disposed of in or about the Station by City, its subtenants or invitees without
the prior written consent of Sound Transit, which shall not be unreasonably delayed, refused or
conditioned. Sound Transit shall be entitled to take into account such factors or facts as are
reasonably relevant in determining whether to grant or withhold consent to City's proposed
activity with respect to Hazardous Material. Even though such vehicles, supplies or materials
may or do contain Hazardous Material, nothing in this Section 4.3 prohibits: (a) vehicles from
using any of City's Parking Spaces or the Other Parking Spaces; or (b) the City or its various
subtenants and licensees, and the various contractors, agents, and employees of any of them,
from bringing upon, using, storing, and disposing of supplies and materials that are usually and
ordinarily used (i) in the normal course of repairing, replacing, maintaining, cleaning, and
making improvements as permitted or required under this Lease or (ii) in the normal course of
such businesses and other activities as may be conducted or permitted from time to time by City
or its various subtenants and licensees as provided in this Lease.
4.4 Si ns.
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267865.1 1 06/26/02
{a) Permanent Signs. City may place or permit such signs on the Leased
Premises (including the exterior walls and windows of the Commercial Tenant Area) as are usual
and ordinary for the occupants thereof to identify and promote their respective businesses or
affairs. However, signs placed on the exterior walls of the Parking Garage shall conform to the
standards specified in Exhibit 4.4(a} attached hereto or to such other standards as Sound Transit
and City may hereafter agree. Any sign installed by City or its subtenants or licensees on the
exterior wall of the Parking Garage shall be removed at the end of the term of the respective
sublease or license and the pari of the such wall affected by such installation or removal shall be
restored to as nearly the same condition as practical to that immediately before such installation.
City shall be responsible for such removal and restoration if City's subtenant or licensee fails to
do so when required. At expiration or earlier termination of this Lease, City shall similarly
remove all signs installed or permitted by it acid restore the affected parts of the Parking Garage.
(b) Special Event Temporary Signs. City may place or permit signs and
banners to be placed on or over the Plaza in connection with a special event permitted under
Section 2.5(d) that are (i) usual and ordinary to the pertinent special event or participants in the
special event, (ii) temporary, -and (iii) not attached to any part of the Station with any permanent
fastening. All such signs placed. by City or its subtenants or licensees shall be removed at the
end of the special event and City shall restore or cause to be restored all damage to the Station
caused by the placement of any such signs.
4.5 Indemnity. City shall indemnify Sound Transit against and hold Sound Transit
harmless .from any and all costs, claims or liability arising from: (a) use of the Leased Premises,
the Other Parking Spaces or the Kiss and Ride Spaces by City, its subtenants, and licensees;
(b) anything done or permitted by City to be done in or about the Leased Premises, the Other
Parking Spaces, the Kiss and Ride Spaces, or the Common Areas, including any contamination
of any property resulting from the presence or use of Hazardous Material caused or permitted by
City, its subtenants and licensees; (c} any negligent or intentional misconduct of City; or (d) use
of any portion of the Station by the City, its agents, licensees, subtenants, or any of the
foregoing's licensees, agents, customers, guests, or invitees, for any of the City's special events.
Sound Transit shall indemnify City against and hold City harmless from any and all costs, claims
or liability arising from: {1) anything done or permitted by Sound Transit to be done in or about
the Parking Garage or the Station, including any contamination of any property resulting from
the presence or use of Hazardous Material caused or permitted by Sound Transit; or (2) any
negligent or intentional misconduct of Sound Transit. The parties' obligations under this Section
extend to, without limitation, injuries to their respective employees (as such employees are
defined in the Industrial Insurance Act, Title 51, Revised Code of Washington) and, to that
extent, each of the parties hereby waive any immunity otherwise afforded to them, respectively,
under that Act or any other applicable workmen's or employees' compensation law.
Notwithstanding the generality of the preceding, the scope of each party's obligation to
indemnify the other in the case of damage or injury caused by the joint or concurrent negligent or
intentional misconduct of both parties shall be limited to the extent the damage or injury is
caused by the indemnifying party.
4.6 Sound Transit's Access. Sound Transit may enter any part of the Leased
Premises, the Other Parking Spaces and the Kiss and Ride Spaces at all reasonable times to
inspect such premises and spaces, to make repairs and replacements thereto Sound Transit is
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267B65.It 05RWO2
obligated or elects to do, to perform such other cleaning and maintenance thereto that Sound
Transit is obligated or elects to do, and for any other proper purpose. However, except in the
case of an emergency,-Sound Transit shall not enter any part of the Commercial Tenant Area or
City's Parking Spaces for any of such purposes without first giving City and each of City's
subtenants and licensees of such of the Area to be affected by such. entry not less than two (2)
business days prior written notice of the entry, the purpose therefor, and the expected scope and
duration thereof
4.'7 Quiet Possession. So long as City complies with its obligations under this Lease,
Sound Transit covenants that City and its subtenants and licensees may quietly occupy and enjoy
the Leased Premises for the full term of this Lease, subject however to the terms and conditions
of this Lease.
ARTICLE 5: CONDITION OF LEASED PREMISES; MAINTENANCE,
REPAIRS AND ALTERATIONS
5.1 Condition and Suitability of Leased Premises. Subject to Sound Transit's
obligations with respect to initial construction of and warranty work related to the Leased
Premises under Section 2.3, City shall accept the Leased Premises in their condition as of the
Commencement Date. City acknowledges that Sound Transit has not made any representation as
to the suitability of the Leased Premises for City's intended use.
5.2 Exemption of Sound Transit from Liability. Except for any damage or injury
caused by its negligence or intentional misconduct, Sound Transit shall not be liable for any
damage or injury to the person, business (or any loss of income therefrom), goods, wares,
merchandise or other property of City, its subtenants and licensees or any other person in or
about the Leased Premises, whether such damage or injury is caused by or results from:. (a) fire,
steam, electricity, water, gas or rain; (b) the breakage, leakage, obstruction or other defects of
pipes, sprinklers, wires, appliances, plumbing, air conditioning or Iighting fixtures or any other
cause; or {c) conditions arising in or .about the Leased Premises or other parts of the Station.
Sound Transit shall not be liable for any such damage or injury even though the cause of or the
means of repairing such damage or injury are not accessible to City. The provisions of this
Section 5.2 shall not, however, exempt Sound Transit from liability for Sound Transit's warranty
obligations under Section 2.3 or from Sound Transit's obligations under this Lease of
maintenance, repair, and rebuilding.
5.3 Sound Transit's Obligations to Repair. Except (i) as otherwise. provided in
Section 5.4 and except (ii) for damage caused by the negligence or intentional misconduct of
City or its subtenants or licensees and except (iii) to the extent of City's obligations under
Sections 2.5(d) and subject to (iv) the provisions of Article 6 {Damage or Destruction) and
Article 7 (Condemnation), Sound `Transit, at Sound Transit's expense, shall at all times keep neat
and clean and maintain in good order, condition and state of repair the Station including but not
limited to performing all appropriate service to and making all necessary replacements of all
parts and systems thereof. It is the intention of Sound Transit and City that Sound Transit shall
at all times maintain all parts and systems of the Station that Sound Transit is obligated to
maintain in an attractive, first-class and fully operative condition.
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5.4 City's Obligations. Subject to the provisions of Article 6 (Damage or
Destruction) and Article 7 (Condemnation), at its expense City shall keep (or shall cause its
subtenants and licensees to keep) neat and clean and maintain in good order, condition and state
of repair (including interior repainting and refinishing, as needed): (a) all parts of the
Commercial Tenant Area bounded. by and including (i) the exterior plate glass and exterior
doors, (ii) the interior surfaces of the perimeter walls, and {iii) everything within the air space
above the upper surface of the concrete slab floor and beneath the underside surface of the
ceiling that is also part of the floor of the second floor level of the Parking Garage; (b) any
awnings at or below the second floor level along the north, south, and east exterior walls of the
of the Parking Garage; (c) any signs on the exterior walls of the Parking Garage installed by City
or its subtenants or licensees; and (d) the parts of any plumbing, mechanical, electrical and
HVAC systems of the Parking Gazage which serve only the Commercial Tenant Area. Without
limiting the generality of the preceding, at its expense City shall repair or cause to be repaired
any damage caused to the Commercial Tenant Area by the negligence or intentional misconduct
of City or any of its subtenants or licensees (or their invitees, contractors, and customers) but
after completion of such work, City shall be entitled to receive the proceeds of Sound Transit's
property insurance policy described in Section 3.3(b) to the extent of the policy's coverage for
such damage. City shall provide Sound Transit and its insurer with a statement of City's costs of
the work and, on request, copies of invoices and other billings for the various parts of such work.
It is the intention of Sound Transit and City that at all times City shall maintain the portions of
the Leased Premises that City is obligated to maintain in an attractive, first-class and fully
operative condition.
5.5 Alterations, Additions and Improvements. City may make (or may permit any
of its tenants and licensees to make) any non-structural alterations, additions, or improvements to
all or any part of the Commercial Tenant Area and its various systems and parts (including
installation of awnings and signs on the exterior walls thereof) without Sound Transit's prior
written consent. City may not make {and shall not permit any of its tenants or licensees to make)
any alterations, additions, or improvements to any part of the Plaza or any structural alterations,
additions, or improvements to any of the Commercial Tenant Area without Sound Transit's prior
written consent.. Sound Transit shall not unreasonably delay, condition or refuse such consent.
All alterations, additions, and improvements made by City, its tenants or licensees, shall be done
in a good and workmanlike manner and in conformity with all applicable laws and regulations.
City shall pay, or cause its tenants or licensees who do the work to pay, when due all costs of
such work. If requested by Sound Transit, then promptly after completion of any such work
involving structural alterations, additions, or improvements, City shall provide, or cause its
tenants or licensees who did the work to provide, Sound Transit with "as built" plans and
reasonable evidence of payment. of the costs thereof.
5.6 Condition Upon Termination. Upon the expiration or earlier termination of this
Lease, City shall. surrender the Leased Premises to Sound Transit, broom clean and in the same
condition as received except for: {i) ordinary wear and tear; (ii) alterations, additions and
improvements made as provided in Section 5.5; and (iii) alterations, additions and improvements
made by Sound Transit, if any. However, City shall not be obligated to repair any damage that
Sound Transit is required to repair under Section 5.3 nor any damage described in Article 6
(Damage or Destruction) or Article 7 (Condemnation). In addition, Sound Transit may require
City to remove any alterations, additions, or improvements made by City, its tenants or licensees
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for which Sound Transit's consent was required and, when given, such consent was conditioned
on such removal. All alterations, additions and improvements which City is not obligated to
remove shall become Sound Transit's property and shall be surrendered to Sound Transit upon
the expiration or earlier termination of this Lease, except that City, its tena~rts and licensees may
remove (i) their respective trade fixtures and (ii) all or any part of their respective machinery and
equipment which can be removed without material damage to the Leased Premises. City shall
repair at City's expense, or City shall cause City's tenants and licensees to repair at their expense,
any damage to the Leased Premises, including any improvements thereon, caused by the removal
of any such machinery, equipment or trade fxtures.
ARTICLE b: DAMAGE OR DESTRUCTION
6.1 Partial Damage to Parking Garage. City shall notify Sound Transit in writing
promptly after it learns of the occurrence of any damage to the Leased Premises. If as a result of
any cause the Parking Garage is partially damaged, Sound Transit shall repair the damage,
including any damage to the Leased Premises, as soon as reasonably possible and this Lease
shall remain in effect. Sound Transit may elect (but is not required) to repair any damage to
fixtures, equipment, or improvements made by City, its tenants or licensees. "Partially
damaged" means the cost of repair, as reasonably estimated by Sound Transit, is not more than
sixty. percent (60%) of what would be the cost of constructing at that time the Parking Garage as
originally constructed. plus any improvements, alterations or additions made thereto by Sound
Transit after completion of initial construction.
6.2 Substantial or Total Destruction. If the Parking Garage is substantially
destroyed by any cause whatsoever (e.g., the damage to the Parking Garage is greater than partial
damage as defined in Section 6.2), Sound Transit may elect to .restore the Parking Garage
(including the Leased Premises}, in which case Sound Transit shall do so as soon as reasonably
possible and this Lease shall remain in effect. Sound Transit may elect (but is not required) to
repair any damage to Cxtures, equipment, or improvements made by City, its tenants. or
licensees. Not later than ninety (90) days after the date of the destruction, Sound Transit shall
give written notice to City of whether Sound. Transit will or will not restore the Parking Garage
under this Section and, if Sound Transit elects to restore, whether its restoration will include
fixtures, equipment, or improvements made by City, its tenants or licensees. If Sound Transit
elects not to restore the Parking Garage under this Section, then (a) this Lease shall terminate as
of the date of the damage and {b) after deducting therefrom the costs of demolition of the
Parking Garage, the proceeds, if any, of the property insurance policy described in Section 3.3(b)
including any optional flood or earthquake coverage) shall be paid to Sound Transit and to City
in the proportion of their respective interests in the Parking Garage.
6.3 Abatement of Certain Charges; Setoff of Certain .Expenses. If this Lease
remains in effect after damage or destruction under any of Sections 6.1 or 6.2, then to the extent
that as a result of such damage or destruction to, or of the work of restoration of, the. Commercial
Tenant Area or City's Parking Spaces is or are not reasonably useable for the purposes they were
being used immediately before the damage or destruction occurred, then those charges to be paid
by City under Sections 3.1 through 3.3 and Section 5.4 shall abate in the proportion that such
Area or the City's Parking Spaces, or both, is or are not so useable. If Sound Transit elects not to
restore under Section 6.2 but City does elect to restore under such Section, then the amount of
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City's costs of restoration which are not reimbursed from proceeds of insurance shall be setoff
against all sums payable by City to Sound Transit under this Lease in the order in which such
sums would otherwise be due until the entire amount, together with interest at eight percent (8%)
per annum on the declining principal balance thereof, has been fully setoff.
6.4 Exceptions. Notwithstanding the preceding provisions of this Article 6, this
Lease shall terminate as of the date of the damage and Sound Transit shall have no obligation to
restore the damage if (a) the damage occurs within the last two years of what would otherwise be
the Term of this Lease or (b) the work of restoration cannot reasonably be completed by a date
on which there would be remaining at least two years in the Lease Term. For the purposes of the
preceding, if not previously exercised, City may exercise its option under Section 2.2 to extend
the Term of this Lease if such option is exercised within sixty (60} days after the date the damage
occurred.
ARTICLE 7: CONDEMNATION
7.1 Permanent Taking.
(a) General Provisions. if all or any portion of the Leased Premises are
permanently taken under the power of eminent domain or are conveyed under the threat of that
power, this-Lease shall terminate as to the part taken or conveyed as of the date the condemning
authority is entitled. to possession thereof. If twenty percent (20%) or more of the floor area of
the Commercial Tenant Area is taken, City may terminate this Lease as to the remainder of the
Commercial Tenant Area or as to all the Leased Premises as of the date the condemning
authority is entitled to possession. If twenty percent (20%) or more of the City's Parking Spaces
is taken,. City may terminate this Lease as to the remainder of City's Parking Spaces or as to all
the Leased Premises as of the date the condemning authority is entitled to possession. If some
but not .all of the parking spaces in the Parking Garage are taken and if this Lease remains in
effect after such taking, then the remaining parking spaces in the Parking Garage shall be
reallocated between City and Sound Transit so that, after such reallocation, the City's Parking
Spaces bear the same proportion to the remaining parking spaces in the Parking Garage as the
number 180 bears to the number 562. Notwithstanding the preceding sentence, if such
reallocation would reduce the number of the Other Parking Spaces below four hundred eighteen
(418), then. Sound Transit may elect to allocate to itself up all or any part of the remaining
parking spaces in excess of thirty-six (36) of such remaining parking spaces (which shall be
allocated to City) but in such case, and as a condition to such election, Sound Transit shall pay to
City that sum of money calculated as follows: {i) first, determine the number of the remaining
parking spaces that would have been allocated to City on the basis of the ratio of 180 to 562; (ii)
second, determine the number of the remaining parking spaces allocated to City after Sound
Transit's reallocation election; (iii) third, subtract the second of such numbers from the first of
such numbers; (iv) fourth, divide the amount of the compensation for the taking that is allocable
to the parking spaces taken by the number of the parking spaces that was taken; and (iv) fifth,
multiply the number derived in the third step by the amount derived in the fourth step. Sound
Transit and City shall each exercise their respective elections by written notice to the other given
within sixty (60} days after receipt of final written notice from the condemning authority of the
final extent of the taking (or in the absence of such notice, within sixty (60) days after the
condemning authority is entitled to possession). if this Lease is not terminated according to the
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preceding parts of this Section, then this Lease shall remain in effect as to the portion of the
Leased Premises nol taken and Sound Transit shall restore those portions of the Parking Garage
that are not taken to as nearly as practical the condition immediately before such taking and in a
eonftguration so that the various parts of the restored Parking Garage are economically
functional and useable for their intended purpose. The plans and specifications for the work of
restoration and any changes thereto shall be as agreed by both Sound Transit and City, neither of
which shall unreasonably refuse, delay or condition their agreement. Copies of such plans and
specifications, as they may b'e changed and as-built, shall be provided to City, all similarly to the
provisions of Section 2.3 for initial construction of the Parking Garage.. Sound Transit and City
shall each contribute to the costs of such restoration in the proportion that they received
compensation for the taking (excluding any part of their respective compensation that was
separately awarded in addition to the value of their respective property interests, such as
compensation for moving or other relocation expenses).
(b) Allocation of Award. In the case of a permanent taking or damaging of
the Parking Garage or any part thereof, City and Sound Transit shall each receive the value of
their respective interests in the property taken or damaged by eminent domain or conveyed under
threat thereof, together with such interest thereon and attorneys fees and other costs to the extent
awarded. City and Sound Transit shall each have the right, as against the condemning authority,
to recover, to the extent of their respective interests, damages or other compensation for the
permanent taking of or damage or injury to the Leased Premises or any. part thereof. City and
Sound Transit shall each have the right to participate in any condemnation proceeding and be
represented by counsel for the purpose of protecting their respective interests under this Section.
If the City and Sound Transit do not agree on their respective shares (after engaging in the
dispute resolution process set forth in Section 9.7), then such shares shall be as determined by the
King County Superior Court in the condemnation proceedings, if any, or in a separate action
between City and Sound Transit. In addition, each of City and Sound. Transit shalt have the right
to recover from the condemning authority such other compensation as they may, respectively, be
entitled in addition to compensation for the value of the property taken, damaged or injured.
Such additional compensation may include but is not necessarily limited to loss of business and
relocation costs.
7.2 Abatement and Adjustment of Charges Payable by City. If there is a
permanent taking or damaging (collectively "taking"} and this Lease is not terminated under
Section 7.1 then to the extent that as a result of the taking (or of the work of restoration) the
Commercial Tenant Area or City's Parking Spaces is or are not reasonably useable for the
purposes they were being used immediately before the. taking occurred, then those charges to be
paid by City under Sections 3.1 through 3.3 and Section 5.4 shall abate in the proportion that
such Area or City's Parking Spaces, or both, es or are not so useable. After the work of
restoration is completed, the City's shaze of the costs and expenses described in Sections 3. I
through 3.3 and Section 5.4 shall be adjusted equitably to the extent appropriate, if any, to reflect
the changes in the Leased Premises as a part of the restored Parking Garage as compared to the
Leased Premises as a part of the Parking Garage before the taking.
7.3 Temporary Taking. If the whole or any part of the Leased Premises is
temporarily taken under the power of eminent domain or temporarily conveycd under threat of
the exercise of such power, then this Lease shall continue and, except to the extent the parties are
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ze~ses. i i nnizb/oz
prevented from doing so pursuant to the terms of the taking, the City and Sound Transit shall
each perform and observe all of the terms and conditions of this Lease as though the taking had
not occurred. In the event of such a temporary taking, City shall be entitled to receive the entire
amount of any award made for such taking, whether paid byway of damages, rent ar otherwise,.
unless such period of temporary taking shall extend beyond the expiration date of the Term, in
which case such awazd shall be apportioned between the City and Sound Transit as of such
expiration date. For the purposes of the preceding, if not previously exercised, City may exercise
its option under Section 2.2 to extend the Term of this Lease.
ARTICLE 8: ASSIGNMENT AND SUBLETTING
8.1 Subletting. City shall exercise reasonable efforts to locate suitable tenants for the
Commercial Tenant Area. City may sublease all or any part of the Commercial Tenant Area
from time to time during the term of this Lease and no consent of Sound Transit is required on
account thereof or to any assignment or sub-subleasing of all or any part of the subtenant's rights
under its sublease with City, provided that: (i} City attaches a copy of this Lease to each such.
sublease; (ii) the sublease requires the subtenant to maintain liability and property insurance as
provided in Section 3.3{a) through {d) and 3.3, including naming Sound Transit as an additional
insured; and {iii) if the subtenant provides alcoholic beverages anywhere on the Station, the
subtenant shall also obtain a host liquor liability endorsement io its liability insurance.
$.2 Assignment. City may assign all, but not a part, of its rights and obligations
under this, Lease to any municipal government or any governmental agency that is a successor to
the C.ity's municipal functions in the area where the Pazking Garage is located and no consent of
Sound Transit is required on account thereof City may not otherwise assign all or any part of its
rights or obligations under this Lease without Sound Transit's prior written consent, which Sound
Transit shall not unreasonably refuse, delay, or condition.
8.3 Release of City. Except as provided below, no sublease by City and no
assignment by City shall release City or change City's primary Liability to perform all its
obligations under this Lease. Consent to one assignment where Sound Transit's consent is
required is not consent to any subsequent assignment for which Sound Transit's conscnt is
required. In the case of City's assignment to a successor municipal government or governmental
agency, City shall be released and discharged from all obligations of performance under this
Lease and the assignee shall be liable for payment and performance of all City's obligations
under this Lease, including any which have not been fully paid or performed when the
assignment is made.
8.4 Requesting Sound Transit's Consent. City's request for consent to any
assignment described in Section 8.1 for which Sound Transit's consent is required shall be in
writing and shall .describe the proposed transaction in sufficient detail so that Sound Transit is
fully informed of the parties to and the nature and scope of the proposed assignment, including
but not limited to the name of the proposed assignee, the proposed effective date of the
assignment, and the proposed terms and conditions of the assignment. Promptly on Sound
Transit's request therefor, City shall provide any additional information reasonably requested by
Sound Transit in order to evaluate whether to give its consent to the proposed assignment.
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267865) l 06h6l02
8,5 Sound Transit's Right to Information. Promptly after Sound Transit's request
at reasonable intervals from time to time, City shall provide Sound Transit a written statement
identifying the name and address of all such City's then current subtenants and licensees, a copy
of their then current written subleases and licenses and, in the case of any unwritten tenancies or
licenses, a written statement in reasonable detail of the terms and conditions thereof. Sound
Transit may inspect City's books and records to verify the accuracy of the information and copies
provided by City to Sound Transit under this Section.
ARTICLE 9: BREACH AND REMEDIES
9.1 Time is of the Essence. Time is of the essence in the performance of all
covenants and conditions under this Lease of Sound Transit and of City.
9.2 Default and. Breach Defined. A party to this Lease shalt be in "default" of an
obligation it has under this Lease if the party does not pay or perform the obligation as and when
due, except that if such failure is later cured, then the party shall no longer be in default on the
obligation. A party to this Lease shall be in "breach" of an obligation it has under this Lease:
(a) If the party fails to make any payment required of it under this Lease
within thirty (30) days after the other party's written notice of default specifying the amounts in
default and the due date(s) thereof;
(b) If the party fails to perform any of the party's other obligations under this
Lease for a period of thirty (30) days after written notice from the other party specifying the
obligation in default and the action required of the party in default to cure such default.
However, if more than thirty (30) days are reasonably required to complete such performance,
the party in default. shall not be in breach if the party commences such performance within the
thirty (30} day period and thereafter diligently and continuously pursues such performance to
completion.
(c) If (i) a petition for adjudication of bankruptcy or for reorganization or
rearrangement is filed by or against the party and is not dismissed within one hundred eighty
(180) days; or if (ii) if a trustee or receiver is appointed to take possession of substantially all of
the party's assets and such appointment is not dismissed or if possession of such assets is not
restored to the party within one hundred eighty (180 days) after such appointment.
The requirements for notice specified in subparts (a) and (b) of this Section 4.2 are
intended to satisfy any and all notice requirements imposed by law and are not in addition to any
such requirement.
9.3 Sound Transit's Remedies for City's Breach.
(a) General Provisions. CM or at any time after the occurrence of any breach
of one or more of City's material obligations under this Lease, Sound Transit may elect to:
(1) Recover the sums owed by City under this Lease together with
interest thereon at the rate of eight percent (8%) per annum on the unpaid priT~cipal balance
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thereof from time to time beginning with the date the sums were due and ending when the sums
have been fully paid;
(2) Specifically enforce City's obligations under this Lease;
{3) Recover damages caused to Sound Transit by City's breach; and/or
(4) Perform the obligations of City that are in breach and recover from
City the costs. incurred by Sound Transit in such performance.
(b) Termination. If, during any period of thirty-six consecutive months during.
the Terrn of this Lease, Sound Transit obtains a judicial order that is final and not appealable
specifically enforcing one or more of City's material obligations under this Lease and {i} City
fails to comply with such order within the time period set forth with the order (as it may be
amended} for such compliance or (ii) Sound Transit obtains a second judicial order specifically
enforcing one or more of City's material obligations under this Lease (whether the same or
different obligations than involved in the first order), then Sound Transit may terminate City's
right to possession of the Leased Premises by written notice to City if such notice is given not
later than thirty days after the second order is final and not appealable and provided that such
notice gives City not less than thirty (30) days after the date of the notice to surrender possession
of the Leased Premises to Sound Transit.
(c} Remedies Cumulative. The remedies provided in this Sections 9.3(a) and
9.3(b) .are cumulative with each other and cumulative with and in addition. to all other remedies
as may be permitted by law or equity except that (except as. otherwise provided in Section
9.3(b)}, Sound Transit hereby waives and releases any and all rights, and shall have no right, to
terminate -this Lease or City's rights of possession of any part of the Leased Premises on account
of any breach by City of one or more of its obligations under this Lease. As a substitute for such
termination, Sound Transit may obtain an order from a court with jurisdiction over the parties
and the subject matter directing City's subtenants and licensees to attorn to and perform to and
for the benefit of Sound Transit all of such subtenants' and licensees' respective obligations under
their sublease or license until City has fully cured its breach, including payment (to the extent
applicable) under subparts (i), (ii) and (iv) of this Section or such other time as the court may
direct.
(d) Emergencies. If City's default in any of its obligations under this Lease
creates or enhances an emergency, a serious risk of death or injury to any person, or a serious
risk of injury or damage to any property, Sound Transit may, without giving .City prior notice
and opportunity to cure, immediately. exercise the remedy specified in Section 9.3(a)(iv) with
respect to that default and, for that purpose, enter any part of the Leased Premises reasonably
necessary to do so,
4.4 City's Remedies for Sound Transit's Breach.
(a) General Provisions. On or at any time after the occurrence of any breach
of one or more of Sound Transit's obligations under this Lease, City may elect to:
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{ 1 } Terminate this Lease and recover and setoff under subparts (iv)
and (v) of this Section;
(2) Bring an action for specific performance of Sound Transit's
obligations and recover under subpart (iv} of this Section;
(3) Perform the obligations of Sound Transit which are in breach and
recover under subpart (iv) of this Section;
{4) Recover from Sound Transit (A) all monetary sums, if any, then
due and unpaid to City by Sound Transit, (B) the costs of performing or completing obligations
of which Sound Transit is in breach, and (C) damages caused to City by Sound Transit's breach;
and
(5) Setoff all or any part of the sums described in subpart (iv) of this
Section against any sums payable by City to Sound Transit under this Lease in the order in which
such sums would otherwise be duo until the entire amount, together with interest at eight percent
{8%) per annum on the declining principal balance thereof, has been fully setoff.
City shall give Sound Transit written notice of City's elections under this Section 9.4.
City's election of any of the remedies under subparts {ii) through (v) shall not preclude City from
electing at a subsequent time any other of such remedies or of electing to proceed under
subpart (i)_ The election of the remedy under subpart {i} precludes the subsequent exercise of
any other remedy. Except as provided in the preceding sentence, the remedies specified in this
Section are cumulative with each other and cumulative with and in addition to all other remedies
as may be permitted by law or equity.
(b) Emergencies. If Sound Transit's default in any of its obligations under this
Lease creates or enhances an emergency, a serious risk of death or injury to any person, or a
serious risk of injury or damage to any property, City may, without giving Sound Transit prior
notice and opportunity to cure, immediately exercise the remedy specified in Section 9.4(a)(iv)
with respect to that default and, far that purpose, enter any part of the Parking Garage and of the
Station reasonably necessary to do so.
9.5 Interest. Any amount owed by one party to the other under this Lease which is
not paid when due shall bear interest at the rate of eight percent (8%) per annum. from the due
date of such amount. The payment of interest on such amounts shall not excuse or cure any
default under this Lease on account of the failure to pay the amount owed when due.
9.6 Attorneys' Fees and Costs. In any action between the parties arising out of or
related to this Lease, the prevailing party shall recover from, and the losing party shall pay to the
prevailing party, the prevailing party's reasonable expenses of the action. "Action" includes:
(i) litigation or other adversary proceeding in any court or governmental body with jurisdiction
(including but not limited to a bankruptcy court); appeals of the decision of any lower tribunal
(including but not limited to an award in arbitration}; and, if such proceedings are required by
law or agreed by the parties, alternative dispute resolution proceedings (such as but not limited to
mediation and/or arbitration}. "Expenses of the action" include but are not limited to the
reasonable fees and costs of witnesses, consultants, experts, and attorneys. However, anything
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appearing to the contrary notwithstanding, the provisions of this Section 9.6 do not apply to
mediation under Section 9.7(b).
9.7 Aispute Resolution.
(a) Negotiation. The Parties agree to use their best efforts to resolve disputes
and other matters arising out of the planning, design and construction of the Station and Station
Area (including but not limited to the Parking Garage and the Plaza Areas), arising out of the'
ongoing administration of the Parking Garage and Plaza Axeas facilities, and arising under this
Lease. If an issue cannot be resolved between Sound Transit and City, either of them may
invoke a formal Conflict resolution process. The first step in the process is a meeting including
Sound Transit's Chief Operating Officer and City's Planning Director. If these persons do not
resolve the dispute in a timely manner, the second step in the conflict resolution process shall be
a meeting of Sound Transit's Executive Director and City's Mayor. if these persons do not
resolve the dispute in a timely manner the third step in the conflict resolution process shall be a
meeting of Sound Transit's Chairman of the Boazd and City's Mayor. Sound Transit and City
agree to exhaust all three steps of this negotiation process before seeking mediation as next
described.
(b) Mediation. If the parties do not resolve the dispute in the conflict
resolution process described in Section 9.7(a), then either party may by written notice to the
other require that the dispute be submitted to mediation. Within fourteen (14) days after such
notice, the parties shall agree on and mutually appoint a mediator. If such agreement and
appointment is not made, then either parry may petition the King County Superior Court to
appoint a mediator. Each party shall participate in good faith in the mediation process. with the
appointed mediator. Sound Transit and City each agree to participate in good faith in the
mediation process with appointed mediator before seeking redress in a court of law or other
tribunal. The costs and fees of the mediator shall be paid one-half each by City and by Sound
Transit.
ARTICLE 10: MISCELLANEOUS PROVISIONS
10.1 Non-Discrimination. Neither City nor Sound Transit shall discriminate against
any person or group of persons on the basis of race, color, sex, creed, national origin or ancestry
in any way related to or arising out of the party's rights or obligations under this Lease.
10.2 Interpretation. The captions of the Articles and Sections of this Lease are
intended only to assist in reading this Lease and aze not a part of the terms or provisions of this
Lease nor shall they be considered in construing or interpreting any provision of this Lease.
Whenever required by the context of this Lease, the singular shall include the plural and the
plural shall include the singular. 'fhe masculine, feminine and neuter genders shall each include
the other. In any provision relating to the conduct, acts or omissions of either party to this Lease,
reference to the party shall also be to the party's agents, employees, contractors, and successors.
10.3 Notices. Any notice required or permitted to be given by one party to this Lease to
the other related to this Lease shall be in writing and shall be sufficient if given to the other party
either by personal delivery or by first class, postage prepaid, United States mail. Notices to City
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shall be addressed to City's Director of Planning and delivered to the address specified in
Section 1.4. Notices to Sound Transit shall be addressed to Sound Transit's Sounder Operations
Manager and delivered to the address specified in Section 1.3. Either party may change its
notice address by written notice to the other party. "Notice" includes but is not limited to a
demand and a request. At the option of the sender, mailed notices may be mailed registered or
certified mail with return receipt requested. Notices that are persona[ly delivered shall be
deemed given on the date the notice is delivered. Notices that are mailed shall be deemed given
on the third business day after the notice is mailed. Notices that are sent and received by courier
or messenger service shall be considered to have been personally delivered. Notices that are sent
and received in complete farm by facsimile transmission shall be considered to have been
personally delivered when sent if the sending party receives a written send verification on its
facsimile device. The preceding sentence does not obligate any party to accept a facsimile
transmission. "Facsimile transmission" is a method of encoding a written document into data by
a transmitting device, transmitting the encoded data to a receiving device, and decoding the
transmission at the receiving device to reproduce a paper copy of the original document,
including but not limited to any graphic material on the original document, including but not
limited tv signatures, drawings, logos, notes, and photographs. The method of electronic
communication commonly known as "e-mail" is not a facsimile transmission (even if
accompanied by an attachment) and is not an acceptable means of giving notice.
10.4 Recording. This Lease shall not be recorded without the prior written consent of
both parties. However, promptly after the request of either party, both parties shall execute,
acknowledge, deliver to one ,another, and record a Memorandum of this Lease giving
constructive notice of the terms and conditions hereof. The party requesting such recording shall
pay the recording fees thereof.
10.5 Binding Effect; Governing Law, This Lease is binding upon the parties hereto
and their respective successors and assigns in interest. However, the preceding sentence does not
permit any assignment in contravention of other provisions of this Lease. This Lease is governed
by and shall be construed and enforced according to the laws of the State of Washington,
excluding that State's laws relating to choice of law.
10.6 Force Majeure. If either party cannot perform any of its obligations due to
events beyond the party's control, the time provided for performing such obligations shall be
extended by a period of time equal to the duration of such events. Events beyond a party`s
control include, but are not limited to, acts of God, war, civil commotion, labor disputes, strikes,
fire, flood or other casualty, shortages of labor or material, government regulation or restriction
and weather conditions.
10.7 Authorized Persons. For the purpose of all provisions of this Lease that require
Sound Transit's consent or approval or that require Sound Transit to consult or agree with City,
the person authorized to act for Sound Transit in all such matters is Sound Transit's Chief
Operating Officer. For the purpose of all provisions of this Lease that require City's consent or
approval or that require City to consult with or agree with Sound Transit, the person authorized
to act for City in all such matters is City's Director of Planning. Each party may from time to
time change its authorized person by written notice to the other,
-31-
26~865.11 06/26/02
10.8 Survival. Terms anal provisions of this Lease related to liability and indemnity
obligations shall survive the expiration or earlier termination of this Lease.
BY THEIR SIGNATURES BELOW, EACH OF THE PARTIES CERTIFY THE
PROVISIONS OF SECTION 4.5 WERE MUTUALLY NEGOTIATED.
"SOUND TRANSIT"
"CITY"
Central Puget Sound Regional Transit Authority City of Auburn
-- • ~Cfir~ s.ca-1
P ame- o r ,. n G-iS
Its ~(,~ 've
APPROVED AS TO FORM
By 'r r--"-~--'
Peter B. Lewis, Mayor
Dated: ~~~ N~ .,ZZ , 2002
ATTEST:
Sound Transit egal Counsel
Cathy Ri ,Deputy City Clerk
APPROVED AS TO FORM:
gel B. He Attorney
-32-
267863.11 ~ ob/2~02
SOUND TRANSIT'S ACKNOWLEDGEMENT
STATE OF WASHINGTON }
ss.
COUNTY OF KING )
I.certify that I know or have satisfactory evidence that J(7Q.t")fl Td, ~rdC~U ~ is
the person who appeared before me, and said person acknowledged that ,'she signed this
instrument, on oath stated that he was authorized to execute the instrument and acknowledged it
as the('1~i~'~ ~mL,SfiatltrF ~~c(of CENTRAL PUGET SOUND .REGIONAL TRANSIT
AUTHORITY to be the free and voluntary act and deed of said Washington regional transit
authority, for the uses and purposes mentioned in the instrument.
and official seal hereto affixed this ~~~day of~ ' , , 2002.
~O "So
i `~ :'fir ~O7AA y ~ ~ r~
~i PUgLIG
~~~t'cTj9: ~p-9-~~"
,, ~~ofivi
(Si tore of Notary)
{Print or stamp name of No }
NOTARY PUBLIC in and for the State
of Washington
My Appointment Expires: ~ Q -~~ .. ~
CITY'S ACKNOWLEDGEMENT
STATE OF WASHINGTON
COUNTY OF KING
ss.
I certify that I know or have satisfactory evidence that PETER B. LEWIS is the person
who appeared before me, and said person acknowledged that he signed this instrument, on oath
stated that he was authorized to execute the instrument and acknowledged it as the Mayor of
CITY OF AUBURN to be the free and voluntary act and deed of said Washington municipal
corporation, for the uses and purposes mentioned in the instrument.
WITNESS my hand and official seal hereto affixed thiso~ day of .tilt{../, 2002.
_~..,,~`
Q'P- Po B oT y~l ~lr
i Q : ~~~Q~~RY 9N : +~i
~ L` ~ i
~~i -U_ ~ 03: O~~
~ ~~ ~ Pc,~
~~ OFW
~~ti~....--''
(Signature of Notary)
(Print or stamp name of Notary)
NOTARY PUBLIC in and for the State
of Washington
My Appointment Expires: 1(} -- 9 --~ 5j
--~•---
-33-
267865. i I 06/lfi/0:
Exhibit 1.1(b)
Commercial Tenant Area and City's Parking Spaces
267865.11
Ilb/26/02
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AUBURN STATION PARKING GARAGE
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1 SECOND ~ TH[RD >r~.ooR
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AUBURN STATION PARKING GARAGE
FOURTH ~ F1FTH FLOOR
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AUBURN STATION PARKING GARAGE
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AUBURN STATION PARKING GARAGE
Exhibit 1.1{e)
Station, Parking Garage, Plaza, Plaza Tenant Area and Kiss and Ride Spaces
267365. I I UW26/OZ
1~
1 SITI: PLAN
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AUBURN STATION PARKING GARAGE
Exhibit l.l(f)
Legal Description of Parking Garage and Plaza Property
That certain parcel of land situated in the City of Auburn, County of King, State of Washington,
being all of Block 4 of the Town of Slaughter as shown on a plat thereof recorded in Volume 2
of Plats, at Page 56, records of said county, and that portion of the street vacated by Ordinance
Nos. 481, 483 and 493 of said city, described as a whole as follows:
BEGINNING at the northeast corner of said Block 4, said corner being the intersection of the
southerly margin of First Street SW (60.00 feet wide) with the westerly margin of "A" Street SW
(60.00 feet wide); thence along the northerly line of said block and said southerly margin of First
Street SW, and its westerly extension, North 89°05'36" West 234.84 feet to the easterly line of
The Burlington Northern and Santa Fe Railway Company Right-of--Way; thence along said
easterly line, South 00°40'12" West 96.19 feet to the beginning of a tangent curve concave
easterly and having a radius of 17138.74 feet; thence continuing along said easterly line and
along said curve southerly 164.42 feet through a central angle of QO°32'59" to the westerly
extension of the northerly margin of Second Street SW {60.00 feet wide); thence along said
westerly extension and the southerly line of said block, South 89°05'36" East 232.85 feet to the
southeast comer of said block and. said westerly margin of "A" Street SW; thence along the
easterly line of said block and said westerly margin, North 00°S6'04" East 260.60 feet to the
POINT OF BEGINNING.
NOTE: THE FOREGOING LEGAL DESCRIPTION INCLUDES (a) ALL THE REAL
PROPERTY ON WHICH ALL THE PARKING GARAGE AND SOME OF THE PLAZA
ARE LOCATED, (b) SOME REAL PROPERTY WHICH IS PART OF THE STATION
BUT ON WHICH NO PART OF THE PARKING GARAGE OR THE PLAZA IS
LOCATED BUT (c) DOES NOT INCLUDE ALL OF THE REAL PROPERTY ON
WHICH THE PLAZA IS LOCATED. _ON OR BEFORE THE DATE WHICH IS SIX {6)
MONTHS AFTER TAE DATE OF THIS LEASE, SOUND TRANSIT SHALL AT ITS
EXPENSE PROVIDE AN ACCURATE LEGAL DESCRIPTION OF THE REAL
PROPERTY ON WHICH ONLY THE PARKING GARAGE AND THE PLAZA ARE
LOCATED, PERFORMING ANY SURVEY REQUIRED THEREFOR. WHEN SUCH
ACCURATE LEGAL DESCRIPTION IS PREPARF,D A NEW EXHIBIT 1.1(f)
CONTAINING SUCH DESCRIPTION SHALL BE SUBSTITUTED FOR THE
FOREGOING LEGAL DESCRIPTION.
267855.11 05/25/02
Exhibit 1.1(i)
Parking Garage Operating Procedures
I. Hours of Operation
A. Standard Hours
I. 6:00 am to 9:00 p.m.
2. Monday through Friday
3. Closed for Sounder Holidays
(New Years Day, Memorial Day, Fourth of July, Labor Day,
Thanksgiving Day, Christmas Day)
B. Special Event Service Hours of Operation -- Special events days (Mariner games,
Seahawk games, etc.) will have operating hours as updated from time to lime and published on
Sound Transit's website, www.soundtransit.org/Sounder/timetables/event.
II. Authorized Vehicles
A. Sounder rail commuters
B. Other public transit and rideshare commuters
C. City of Auburn employees and guests
D. City of Auburn subtenants, licensees and their employees, customers, invitees and
guests
III. Authorized Access and Key Holder Protocol
A. Authorized Key Holders
I . Sound Transit
2. Agents of Sound Transit such as security personnel
3. Auburn Fire Dept. (through required fire key lockbox)
4. City of Auburn
5. City of Auburn tenants (commercial space only)
B. Key Holder Protocol
1. All key holders will sign liability document, acknowledging responsibility
for how key assigned will be used;
2. Key holders will agree to no unauthorized key duplication or distribution
3. Upon aecasional required "re-keying" of locks, authorized party
responsible for duplication will provide duplicate copies for all other
parties within a reasonable period of time;
IV. Staff Contacts for Garage Related Issues
Sound Transit
Jeff Benoit, Security Manager
20E~-398-5506
City of Auburn
Jim Kelley, Police Chief
253-931-3080*
267865.11
o~2aoz
Rob Huyck, Safety Manager
206-398-533 2
Bob Hill, Facilities Manager
206-689-3378
Martin Young, Operations Manager
206-398-511 S
Robert Johnson, Fire Chief
253-931-3080*
Paul Krauss, Planning Director
253-931-3091
Jack Locke, Spec. Proj. Eng.
Z53-804-5071
Michael Fuess, Traffic Manager
253-931-3022
*Non-emergency number
267865. ] I 06/2N02
Exhibit 2.3
Plans and Specifications for Sound Transit's Work
Those drawings titled "Auburn Parking Garage, Central Puget Sound Regional Transit Authority,
Auburn, Washington" wherein the general contractor is PCL Construction Services, Inc. of
Bellevue, Washington and the architect is Integrus Architecture of Seattle, Washington, dated
January 22, 2001 as revised on May 3, 2001.
2678bS.11
oandoz
Exhibit 2.S(c)
Holidays
1. each Sunday
2. the first day of each January (New Year's Day}
3. the third Monday of each January (anniversary of the birth of Martin Luther King, Jr.)
4. the third Monday of each February (President's Day)
5. the last Monday of each May (Memorial Day)
6. the fourth day of each July
7. the first Monday in each September (Labor Day)
8. the eleventh day of each- November (Veterans' Day)
9. the fourth Thursday of each November (Thanksgiving Day)
10. the twenty-fifth day of each December (Christmas Day)
NOTE: If any of the foregoing (except Sunday) falls on a Sunday, the holiday is observed on the
following Monday. If any of the foregoing (except Sunday) falls on a Saturday, the holiday is
observed on the preceding Friday.
267865. I 1 OG/2W02
Exhibit 3.2
Parking Garage Operating Costs
Categories of Billable Costs
The following are categories of costs that will or may be incurred that would be covered or
shared by the parties as agreed to (though costs are not limited to these categories}.
Utilities
a. Gas
b. Electric
c. Water
d. Sewer
e. Storm Sewer
f. Refuse
g. Supplies
h. Telecommunications
2. Repairs/Maintenance
a. Janitorial (sweeping, cleaning, trash removal)
b. Garage Sweeper
c. Landscape maintenance
d. Surveillance System
e. ITVAC
f. Electrical
g. Plumbing
h. Elevator
1.). Maintenance
2.} Cleaning
3.) Permitting
4.) Associated Utilities
5.) Repair
i_ Glass
1.) Routine Cleaning
2.) Replacement as required
j. Structural Repairs as required
k. Signage
l.) Maintenance
2.) Repair
3.) Replacement as required
3. Mid-Life Costs
a. Painting
b. Damage from Natural Disasters
26T865 11
06/26!02
c. Items with expired warranties
4. Security
S. Parking Management
Insurance
7. Vandalism
a. Cleaning
b. Repair
c. Replacement
267865 I l ~6~2W02
Exhibit 4.2(c)
Station Rules and Regulations
None as of the date of the Lease.
2fi7Rfi.5 11
Oti2W01
Exhibit 4.4(d)
Exterior Wall Sign Criteria
These criteria have been established for the purpose of controlling the size, design and location
of all exterior signage for the retail subtenant spaces at the Auburn Station Parking Garage.
Conformance to these criteria is required. Sound Transit may remove or correct any installed
nonconforming signs at City's expense (which City may recover from its subtenant). Except as
provided in paragraph 10 of this Exhibit, before Sound Transit exercises such right it shall give
City not less than twenty-one days prior written notice of the nonconformity.
1. Two building attached signs will be allowed for each subtenant of the Commercial
Tenant Area, one on the exterior wall of the building adjacent to each space above the
canopies and one under the canopies near the entrance to each space. The attached
drawings depict typical sizes and locations of these signs.
2. In addition to conforming to these criteria, a permit will be required from the City for
these signs under City's sign ordinances. Approval. by City under this Lease or under a
sublease by City of a particular sign is not compliance with, and does not bind City,
under City's permitting requirements.
3. Signs on the exterior wall of the Parking Garage shall be attached to such wall according
to one or more designs for such attachment proposed by City and approved by Sound
Transit. Sound Transit shall not unreasonably refuse or condition such approval.
4. No signs with electrical components will be permitted. With Sound Transit's prior
written approval of the design therefor, City may at its expense install lighting on the
exterior wall of the Parking Garage to illuminate the signs on the exterior wall. Sound
Transit shall not unreasonably refuse or condition such approval.
5. No projection above or below the sign band and/or panel as depicted in the attached
drawings will be permitted.
6. No permanent window signs will be permitted except painted or decal applied lettering
far purpose of store identification. Each subtenant will also be permitted to place upon
each entrance to its demised premises not more than on hundred forty four {144) square
inches of lettering not to exceed two inches (2") in height, indicating hours of business,
emergency telephone, etc. Temporary window signs will be installed on the interior of
windows only and will be allowed for a maximum of two weeks.
7. City may at its expense install numbers or letters on or near the primary entrance to each
subleased space to identify the address thereof.
8. Each subtenant will pay for the construction, installation and maintenance of all its signs.
2easbs. t t o~zs~az
9. At City's request from time to time, exceptions to these standards will be reviewed by
the City and Sound Transit. However, and without limiting other possible reasons for
refusal, the parties recognize deviations may result insubstantial inequities between
City's subtenants and any such inequity is sufficient ground for eithei party to refuse
permission for a requested exception.
10. No sandwich boards or banners will be displayed upon the exterior of or anywhere
adjacent to the Parking Garage. Sound Transit has the right, without any notice to City
or any of City's subtenants, to remove and dispose of any sandwich boards at City's
expense (which City may recover from it subtenant}.
2ti7865. I I
06/2N02
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AUBURN OAAAGE RETAlL I N T E G R U S
Rage: 2 OP 2 31Q~NAC3E A R C H I T E C T U R E
Revlaad: ~-7-2017? 720 3rd Ave. Suite 2300, 5eattie, WA 98104
P~ofe~t: 2014.04 ELEVATION/WALL SECTLON 2o6/fi28-3137 FAX 206/628-3138
Exhibit F
Tenant Improvement Plan
The following work to be completed by landlord subject to the bids received for the cost of
the work. Eost not to exceed $ :
a.
b.
c.
d.
e.
f.
g. One (1) exterior sign placed under canopy, and One (1) sign attached to the
building above the canopy.
h.
i. Internal electrical, data, telephone outlets.
RENT RIDER
LANDLORD and Tenant should complete only those provisions below which apply.
Any provisions below which is not completed shall not apply to the Lease.
1. BASE: MONTHLY RENT SCHEDULE. Tenant shall pay Landlord base
monthly rent during the Lease Term according to the following schedule. Base Rent does not
include the Leasehold Tax as established by the State of Washington.
Lease Period (Stated in Months)
Months O1 - 12
Months 13 - 24
Months 25 - 36
Months 37 - 48
Months 49 - 60
Base Monthly Rent Amount
Landlord's Initials
Landlord's Initials
Tenant's Initials
Tenant's Initials
2/2/03
OPTION TO EXTEND RIDER
PROVIDED tenant is not in default at the time of exercise or upon the
commencement of any extension term, Tenant shall have One (1) (if not completed,
zero) successive option to extend the term of this Lease for Five (5) years. Tenant
shall exercise each option by delivering written notice to Landlord not less than one
hundred eighty (180) days prior to the expiration of the then current Lease term. Upon
the exercise of any option, the term of this Lease shall be extended for the period of the
subject option upon all of the same terms, conditions and covenants as set forth herein,
except for the amount of the base monthly rental stated in year 5 of the current Lease
which shall be increased in accordance with the increase in the United States
Department of Labor, Bureau of Labor Statistics Consumer Price Index for All Urban
Consumers up to a maximum of the CPI plus 2% when such index increases. In
subsequent years the rent paid annually -will, at the landlord's option, increase by the
CPI.
TENANT IMPROVEMENT RIDER
The Sublessor will improve the premises per the Tenant Improvement Plan as established in
exhibit F of this document. Sublessor shall deliver to the tenant the premise pursuant to the
lease to which this Rider is attached upon completion of the improvements provided in the
Tenant Improvement Plan. All other terms and conditions of this lease shall remain in full
force and effect.
EXHIBIT 2
Sublease Agreement
Between
Auburn and PMF Enterprises
SUBLEASE
This Sublease ("Sublease") is entered into this~say of January, 2003 between the
City of Auburn, a Washington municipal corporation ("Sublessor"), and. PFM Enterprises, Inc.,
a Washington Corporation ("Tenant").
RECITALS:
:A. By that certain Sublease dated June 26, 20.02 Sublessor, as Tenant; leased from
Central Puget Sourxd Regional Transit Authority, a regional transit authority organized and
existing under Chapters 81.104 and 81.113, Revised Code of Washington {"Sound Transit"},
certain property located in the City of Auburn. A copy of such Sublease is attached~~lereto as
Exh_ ibit E. Such Sublease, including any amendments hereafter made thereto by Sublessor and
Sound Transit, is herein called the "Master Sublease".
B. Tenant desires to sublease from Sublessor, and Sublessor is willing to sublease to
Tenant, a portion of the property leased by Sublessor under the Master Sublease on the terms and.
conditions set forth in this Sublease.
~1 ~k
C. Accordingly, Sublessor and Tenant agree as follows: ~
~ h~
SUBLEASE ~ ,fit ()h
X• Y• Si:~MMARY OF SOME PROVISIONS. The following is a summary of some
of the provisions of this Sublease. If there is any conflict between the information in .this
paragraph and any other provision of this Sublease, the other provision controls.
- ---- -------?:1----sublessor: --The-"Snbl~ssor'L-is_-tlie-C-ity-rof Auburn; a-V~Iaslrington_____f_
municipal corporation, acting in its proprietary capacity.
].2 Tenant. The "Tenant" is PFM Enterprises, Inc., a 'Washington
Corporation..
1.3 Leased Premises. The subleased premises ("premises") is that part of the
interior space of the .ground floor of the parking garage ("Parking. Garage") at the Auburn Transit
Station which part is outlined on the floor plan attached hereto as Exhibit A. The Parking
Garage is located on the land legally described in Exh~ attached hereto and the location 'of
the Parking Garage is outlined on the site plan of the Auburn Transit S#ation attached hereto as
Exhibit C. if so~indicated in paragraph 1.4, the "Premises" also includes the part of the Plaza
Tenant Area specified in such paragraph. The Premises is coYnmonly known as __110 `A' Street
S.W., Suite A_~, Auburn, Washington 98001. The Premises includes ail windows and other
.glass in the exterior wall(s) of the Parking Garage within the area outlined on the Exh~t A floor
plan and all doors leading.irito and out of the Premises. The Premises do not include (a) the
exterior walls of the Parking Garage, (b) the area beneath the upper surface of the concrete slab
floor, (c) the area above the lower surface of the suspended ceiling, (d) the area beneath. the
surface of the interior perimeter walls of the Premises, (e) all pipes and ducts,,conduits, wires,
fixtures, and equipment located above the suspended ceiling of, or in structural elements of, the
Parking Garage, or (f) any area within a closet or other enclosure around electrical, mechanical,
or plumbing systems of the Parking Garage even though such closet or other enclosure may not
be excluded or shown on the E~ floorplan.
1.4 . PIaza Tenant Area. The Premises (CHECK ONE):
does
~ does not
include all'or any part of the Plaza Tenant Area.
1.S Cotntneneement Date. The Term of this Sublease shall cornmence ou
March 15 2003_,. or such earlier or later date as provided in paragraph 3 {"Commencement
Date").
1.6 . Expiration Date. Subject to earlier termination as elsewhere provided ih
this Sublease, the Term of this Sublease shall expire at midnight on Ma I4 2008 , or such
earlier or Later date as provided in paragraph 3 {"Expiration Date").
1.7 Right to Extend. Tenant {CHECK ONE}:
~ does
does not
have a right to extend the Ter,~n of this Sublease_ If Tenant does have a ri _t to e te. _~t~e tern, ~_
-- aiid co~i ors o suc rig tare set. forth in the Right To Extend Rider attached hereto.
1.8 Base Monthl Rent. The bad. e` monthly rent {"Base Monthly Rent") is
(CH)ECK ONE):
per month.
X according to the Rent Rider attached hereto.
1.9 Prepaid Rent. Upon execution of this Sublease, Tenant shall pay to
Sublessor the sum of One Thousand Nine Hundred Twent Nine and 58/100 1929.58 as
prepaid rent, to be applied to the Base Monthly Rent due for the third calendar month of the
Term.
1.10 Late Charge. The late charge is five percent of each Late Payment due
from Tenant to Sublessor.
1.~ I Seciu~ity Deposit. The amount of the security deposit is Two Thousand
Dollars and No/100 ($2 000 00~ .
I.12 Permitted Use. The Premises shall be used only for o ce uses
1.13 Sublessors. Notice Addresses: Subject to change as provided in
paragraph 32, "Sublessor's Notice Address" is:
City of Auburn
Attention: Director of Planning
25 West Main Street
Auburn, WA 98001-4998
1.14 Tenant's Notice Address: "Tenant's Notice Address" is, subject to
change as provided in paragraph 32, the following:
PFM Enterprises, Inc.
Attention: Pat Muldary
1980 Island Parkway East
Sumner, Washington 9$394
except that after the Commencement Date and before the expiration or earlier termination of the
Term.the Premises is also a "Tenant's Notice Address" and~Sublessor may give notices to Tenant
at either of such addresses.
1.15, Tenant's Prorata Share. "Tenant's Prorata Share" is 15.6%.
1.16 A,diustments to Tenant's Share. Tenant's Prorata Share is calculated as
the percentage, which is the same percentage of the rentable square feet in the Premises bears to
-------t~ho-rgntabl~-scluare~eet~f--the-Cozrnrrerciai- T`~enant-,~ro~-1~or~these~ p'~i`rposes, u essor an -". --
Tenant agree that, at commencement of the Term, the Premises has 2,105 rentable square feet
and the Commercial Tenant Area has 13,490 rentable square feet. Sublessor m_ay recalculate
the Tenant's Prorata -Share from time to time during the Term if there is a change in
configuration of the Premises or any other space in the Commercial Tenant Area., if Sublessor
recalculates Tenant's Prorata Share, Sublessor shall give Tenant written notice of the new
calculations and of the new amounts of the Tenant's Prorata Share. T'1-e recalculated Base
Monthly Rent and Tenant's Prorata Share shall become effective beginning on the first day of
the first calendar month during the Term that occurs at least fifteen days after Sublessor's notice
as given.
2. DErINITIONS. Wherever used in this Leased the following terms in quotation
marks have the meanings specified below.
2.1 "Additional Rent" is defined in paragraph 7.
2.2 "Base Monthly Rent" is defined in paragraph 1.8.
2:3 "Commercial Te[tant Area" is that part of the interior space of the ground
floor of the Parking Garage that is outlined and labeled "Commercial Tenant Area" on the
Exhibit A floor plan.
2.4 "Common Areas" rxteans those portions, areas and facilities of the
Commercial. Tenant Area and those portions of'the parking garage common.areas as defined in
Section l , l (d) of the Master Sublease that Sublessor, from time to time and acting in Sublessor's
discretion, makes available for the general, non-exclusive use, convenience or enjoyment of
Tenant and the other tenants of the Commercial Tenant Area that are not ~Ieased or held for the
exclusive use of a particular tenant. Common Areas may, but do not necessarily include,
hallways, comdors, docks, loading areas, restrooms, and trash facilities. Common Areas may
also include landscaping, if any, installed and/or maintained by Sublessor in or about the
Commercial Tenant Area and the Plaza (including within "landscaping" plantings in planter
boxes). _
2.5 "Late Payment" is defined in paragraph 5.
2.6 "Law" means any and all applicable (i) common law, (ii) federal, state,
municipal (including that of the City of Auburn in its governmental capacity) or other local law,
statute, ordinance, code, fegulation, and rule, and (iii) decrees and orders of any court,
governmental unit, or .governmental agency with. jurisdiction (including the City of Auburn and
any of its agencies in its or their governmental capacity).
2.7 "Maintain" and "maintenance", in the context of "maintaining" all or any
part of tlae Premises, the Parking Garage, the Commercial Tenant Area, and/or the Plaza or any
part thereof includes service, repair, and replacement.
2.8 "Operating Costs" is defined in paragraph 8.
2:9 "Master Sublease" is defined in Recital A.
2.10 "Parking Garage" is defined in paragraph 1.3 and includes the Premises
(except, if applicable, that part of the Premises that is all or part of the Plaza Tenant Area).
2.11 "Plaza" means those parts of tlic Auburn Transit Center that are outlined
and labeled "Plaza" and "Plaza Tenant Area" on the Exhibit G site plan.
2.12 "Plaza Tenant Area" means tha# part of the Plaza that is outlined and
labeled "Plaza Tenant Area" on the Exhibit C site plan.
2.13 "Premises" is defined. in paragraph l .3 and, if applicable, paragraph 1.4.
4
2.14 "Property" means the Commercial Tenant Area, the Plaza and the
common areas, and includes the Premises.
2.15 "Rent" is defined in paragraph 7.
2.16 "Sound Transit" is defined in Recital A and except that such term also
includes any successor or~assign of Sound Transit.
2.17 "Station" is the Auburn Transit Station 'that is depicted on the site plan
a#tached hereto as Exhibit C and includes the Parking Garage, .the Property.
2.18 "Sublessor" is defined in the paragraph i .1.
2.19 "Sublessoz's Notice Address" is defined in paragraph I.13,
2.2t? "Tenant" is defined, in the paragraph 1.2.
2.21 "Tenant Alteration" is defined in paragraph 16.
2.22 "Tenant Cable" is defined in paragraph 13.
2.23 "Tenant Improvements" is defined in paragraph 33.
2.24 "Tenant's Notice Address" is defined in paragraph 1.14. .
2.25 "Tenant's Prorata Share" is defined in paragraph 1.15.
2.26 "Term" is defined in paragraph 4.
The list of definitions in this paragraph is not'a11-inclusive. Other terms are defined elsewhere in
this Sublease. .
~ --SEA~E~ -9n-#he-t~r~rs-and-eonditions-specifred~rrthis~r~e~; Su-b~less'or
Leases the Premises to Tenant and Tenant leases the Premises from Sublessor.
4. TERM. Subject to (a) earlier termination as herein rovided
p , {b) extension as
herein provided, if applicable, and {c) the other provisions of this paragraph, the term of this
Sublease (the "Term") shall commence on the date specified in paragraph 1(b) {the
"Commencement Date") and shall expire at midnight on M_ ay 14 2(}OS _ (the "Expiratiosi
Date").
41 Early Occupancy. Without Sublessor's prior written consent Tenant shall
not occupy the Premises before the Commencement Date for any purpose other than permitted
according to paragraph 4.1. If Tenant does occupy the Premises before the Commencenent Date
for any other purpose, then the Commencement Date shall be the date of occupancy but the
expiration date shall not be changed,
S
4.2 Delay In Tender of Possession. If for any reason whatsoever Sublessor
is unable to tender possession of the Premises to Tenant by March 15 2003 ,neither Sublessor
nor its agents, employees or officers {including without limitation its Mayor and its the members
of its council) shall be liable for any damage or loss caused thereby, nor shall this Sublease
thereby become void or voidable. However, as Tenant's sole and exclusive right acid remedy on
account thereof (a} Tenant shall not be liable for any Rent or other obligation under this
Sublease until such time as Sublessor does tender possession; and (b} Tenant may terminate this
Sublease by not~less than thirty days` prior written notice to Sublessor unless Sublessor tenders
possession before, the end of such time. If for any reason whatsoever Sublessor is unable to
tender" possession of the Premises to Tenant. by six months after the date specified in this
pazagraph or after the Commencement Date, and i1' Tenant has not terminated .this Sublease, then
Sublessor may by written notice to Tenant terminate this Sublease. If this Sublease is terminated
under this paragraph all prepaid rent and security deposits shall be refunded to Tenant, arzd
neither Sublessor nor Tenant shall have any further obligations to the ~ other. If the
Commencement Date is delayed under the provisions of this paragraph, then the Expiration Date
shall be extended so that the Term shall have 62 full months plus any additional time necessary
so that the Term will end on the last day of a calendaz month.
4.3 Confirmation Of Term. Promptly after the request of either Sublessor or
'T'enant made at any time=after the Commencement Date is lmown, Sublessor and Tenant shall
execute and deliver to each other duplicate originals of a written agreement specifying the
Commencement Date and the Expiration Date of this Sublease. .
5• LATE CHARGE. If any payment of money due from Tenant to Sublessor under
this Sublease is not received by Sublessor in full on or before frve days after the due date the
entire payment shall be considered late ("Late Payment") and Tenant shall also pay to Sublessor,
as part of the Rent, a fate charge of five percent of the full amount of each Late Payment to
compensate Sublessor for the additional administrative costs that will be incurred. by Sublessor
on account of such Late Payment. Neither' this provision for a late charge nor the tender or
payment of a late charge by Tenant shall impose any obligation on Sublessor to accept any
payment (including but not limited to a payment of Rent) that is not paid when due. Sublessor
may conditiwtLits~ccepiance-of~an3r~atg-P-ayment-en-eencurrerrt ~ayrnentrof~tlre-applicable~at~------ -- -
charge. Sublessor's right to require a late chazge is in addition to and cumulative with alI other
rights and remedies Sublessor may have on account of such late payment. "Late Payment"
includes without limitation a payment that is not made at all.
6. SECURITY DEPOSIT,
6.1 Generally, Tenant has paid the amount specified in paragraph 1.11 as the
Security Deposit which shall be security for Tenant's full and faithful performance when due of
all Tenant's obligations under this Sublease. Sublessor may commingle the Security Deposit
with Snblessor's other funds, no trust relationship is created with respect to the Security Deposit,
and no~interest shall be paid or accrued for Tenant's beneft on the Security Deposit. If Tenant
fully and faithfully performs during the'Term all of its obligations under this Sublease, then as an
obligation surviving expiration or earlier tcmunation of the Tenn, Sublessor shall return to
Tenant (or at Sublessor's option, to the last assignee, if any, .af Tenant's interest under this
Sublease} the Security Deposit (or so much of it as has not been applied by Sublessor), without
interest, within a reasonable time after the expiration or earlier termination of this Sublease;
provided that Sublessor may hold back all or any portion of the Security Deposit until final
detertnination and payment of Tenant's Share of Operating Costs. If Sublessoz transfers its
interest under this Sublease, the Security Deposit will be transferred to the transferee and, in such
event, Tenant shall look solely to such transferee for proper application and/or return of the
Security Deposit.
t.2 Sublessor's Ri t To A, 1 . If Tenant fails to pay any sum of money
due to Sublessor from Tenant under this Sublease within five days after it is.due or if Tenant fails
to perform any of its other obligations under this Sublease, Sublessor rnay, -but is not obligated
to, apply all or any part of the Security Deposit in payment of such sums or in payment of
Sublessor's costs of performing such obligation or in compensation for the damages caused to
Sublessor on account of such- failure of performance. If Sublessor so applies all or any part of
the Security Deposit, then within ten (10) days after Sublessor's written demand specifying the
amount so applied and the amount, if any, remaining in the Security Deposit, Tenant shall pay to
Sublessor such amounts as is necessary to fully restore the Security Deposit.
6.3 Increases in Security Deposit. 'If twice within any period of twelve
consecutive months, late chazges are incurred by Tenant, Sublessor may, by written notice to
Tenant, increase the amount of the Security Deposit by fifty percent of its then current amount
and Tenant shall pay to Sublessor, within ten (10) days after Sublessor's notice of increase, the
amount of the. increase, )f Sublessor applies all or any part of the Security Deposit as permitted
in paragraph 6.2, then the amount of the Security Deposit shall be increased by f fty percent of
the then current amount thereof and on Sublessor's demand, Tenant shall pay to Sublessor the
amount of money required to restore the amount so applied and to pay the increased amount_
6.4 Rights Cumulative. Sublessor's rights to apply and to increase -the
Security Deposit are in addition to and cumulative with a1I other rights and remedies Sublessor
may have on account of Tenant's failure to perform when due each of its obligations under this
Sublease.
7• BASE MONTHLY RENT. Tenant shall pay to Sublessor the amount of the
Base Monthly Rent for the Premises on the firs# day of each calendar month during the Term. In
this Sublease the terra "Additional Rent" means all other sums to be paid to Sublessor under any
other provision of this Sublease. The Base Monthly Rent shall be paid in.addition to any
Additional Rent. In this Sublease the term "Rent" means ,the Base Monthl Rent. Additional
Rent means those costs incurred for the maintenance and o eratian of the buildin .Tenant shall
pay to Sublessor when due all Rent without offset or deduction and, except as expressly provided
otherwise in this Sublease with respect to a particular type of Additional Rent, without prior
natice.or demand. The Base Monthly Rent shall be apportioned for any partial calendar month at
the cornrnencement and at the expiration or termination of the Terri in the proportion that the
number of days in the month during the Term bears to the number of days In that month. All
payments Tenant is required to pay to Sublessor under, arising from, or in connection with this
Sublease shall be made to Sublessor at such place as Sublessor may designate from time to time.
In the absence of, or in the case of lapse of, any such designation, such payments shall be made
to Sublessor's Notice Address.
8. pPERATIIVG COSTS.
8.1 Definitions. The following terms in quotation marks have the meanings
specified below;
8.1.1 "Tax Costs" means: (a) the amount of all taxes and assessments, if
any, levied on Sublessor's interest in the Property, (b) .the amount of all taxes and assessments, if
any, on the personal property owned or leased by.Sublessor and used in connection with the
maintenance, ownership, and operation of the Property; (c) all assessments in lieu of .taxes
(excluding, however, the leasehold excise tax that is described in paragraph 9); and (d) any
expenses, including the costs and fees of attorneys, experts, consultants, witnesses and
appraisers, reasonably incurred by Sublessor in seeking a reduction in or return of any Tax Cost
attributable to a period of time during.the Term or any assessment or valuation which is part of
the basis of any Tax Cost that is attributable to a period of time during the Term, including any
appeals. if a Tax Cost is payable in periodic installments, then "Tau Costs" shall include the
installments (including interest). Tax Costs shall not include any net income, franchise, capital
stock, estate,. or inheritance taxes, and shall be reduced by any refunds or recoveries of Tax Costs
to or by Sublessor from axiy taxing authority to the extent attributable to any period of time
wifhin the Term.
8.1.2 "Maintenance Costs" means the amount of all costs (other thaix
Tax Costs) incurred by Sublessor in leasing, maintaining and operating the Property.
(i) Without limiting the ~ generality of the foregoing, Maintenance
Costs include those of (a) premiums and deductibles for insurance; (b) refuse xemoval from the
Property; {c) electrical, water, gas, sewer, drainage, and other utility and services to the Property
(excluding any separately metered to and paid' by one or more tenants of the Property); (d) xefuse
and trash removal provided to the Property; (e) maintenance of heating, ventilating, and air-
conditioning equipment, ofplumbirig and electrical systems, and of all other parts and systems of
____ ~~ the 1'ro e ~(f} repainting and re~ujhishing, inclue3in~mplacement-of--carpet-or-ether-floor
covering and drapes or other window treatmenfi
(g) pest .control; (h) fire -detection and security
systems or services; (i) independent contractors and Sublessor's employees, if applicable,.
providing services in connection with the ownership, maintenance, or operation of the Property
(including without limitation janitorial, landscape, security, accounting, legal, management, and
other services); (j} parts, tools, equipment, and supplies (including without limitation cleaning
and restroom supplies, light bulbs, ballasts, fuses, other electrical supplies, and paper goods); (k)
amortized amounts of any capital expenditures made by Sublessor in good faith with a
reasonable expectation of reducing other operating costs or to otherwise improve the operating
efficiency of the Property or to comply with any Law first effective after the initial construction
of the Property was substantially completed (the amortization to be based on the useful life of
such improvements as reasonably determined by Sublessor); (1) costs of leasing or acquiring
personal property used in the ownership, maintenance, or operation of the Property; and (rn)
maintenance of all o#lter parts of the 1'rbperty, including without Iiniitation foundations, exterior
walls and glass, roofs, utility facilities, and common areas, In the case of Sublessor's employees,
if any, attributable costs of such employees include wages, salaries, social security taxes,
Medicare taxes, employment taxes, medical and other types of insurance, other benefits, traihing,
and uniforms.
(ii) klowever, "Maintenance Costs" do not include: {a) the costs of
items furnished for the exclusive use of any particular tenant which such tenant has agreed to
reimburse or pay; (b) the costs of improvements Sublessor has agreed to make at Sublessor's
expense for the exclusive use of any particular tenant; {C) leasing commissions; (d) debt service;.
(e) depreciation; (#} costs of capi#al improvements except as provided in paragraphs 8.1.2(i) and
$.1.2(ii); and (g) costs. which are paid or reimbursed by insurance.
8.1.3 "Operating Costs" means the total of Tax Costs and Maintenance
Costs. Any Operating Cost incurred for a period of time part of which is in a calendar year and
part of which is not in the same calendar year, shall be prorated between the calendar years in the
proportion of the number of days in each such year during the period for which the Operating
Cost was incurred. In the year the Term commences and in, as applicable, the year the Term
expires or terrnina#es, that part of the Operating Costs for the year on which the Additional Rent
provided in this paragraph shall be calculated shall be that prorated in the proportion that the part
of the year doling the Terxu bears to that part of the year which is not wiithin the Term. Any
reasonable method of calculating and allocating all or any part of Operating Costs or other
amounts in order to determine the amount of all or any part of Operating Costs consistent with
Sublessor's accounting methods used by Sublessor in goad faith. shall be binding and conclusive
on Tenant. _
8.2 Additional Reut. In addition to the Base Monthly Rent provided in
paragraph 7, Tenant sha13 pay as Additional Rent of the Premises Tenant's Prorata Share of the
Operating Costs for each calendar year during the Tenn. To the extent the Term does z~ot
include all of any particular calendar year, Sublessor shall allocate the Operating Costs for which
Tenant is responsible in any manner consistent with Sublessor's accounting methods so as to
fairly apportion the Operating Costs for that year beriveen those for which Tenant is obligated
and those which are not. All payments on account of Tenant's Prorata Share of Operating Costs
--_shalLbesnade~,uhen-due-as,-and-w#thout f~r~oi-notfee-thanes; provided-in-this~aragaph~$-and--
shall be made without offset or deduction.
8.3 Sublessor's Estimates and Statements.
8.3.1 At Commencement. By no later than the start of the third month
of this lease, the Sublessor shall furnish Tenant a state~tnent in reasonable detail estimatic~g the
amount of Operating Costs Sublessor expects to incur during the year in which the 'T'een
commences and Tenant's Share thereof. Beginning with the first day of the third calendar month
during the Tenn .which is at least fi$een days after Sublessor's statement is .furnished and
continuing on the first day of each subsequent month, Tenant shall pay an amount on account of
the.Additional Rent provided in this Paragraph 8 which is computed by dividing the Tenant's
estimated share thereof by the number of foil calendar months during the 'Perm in the first year.
Such payments shall be made together with and i~~ addition to the Base Monthly Rent provided in
9
Paragraph 7. In addition, with the first such payment on account of such Additional Rent,
`T'enant shall pay any deficiency in estimated payments on account of such Additional Rent. This
"deficiency" shall be the amounts which would have been due from Tenant on account of that
part of the Term preceding the day on which the first paymen# on account of Additional Rent is
due as provided in this Paragraph 8.3.1 as if the Term commenced on the first day of a calendar
month and Sublessor's statement had .been fitznished at least fifteen days before the first day of
the Term.
8.3.2. Subse uent Calendar Years. As soon as practical after the end
of each calendar year during the Tema; Sublessor shall furnish Tenant a statement in reasonable
detail (a) estimating the amount of Operating Costs Sublessor expects to incur during the current
calendar year and Tenant's Share thereof; (b) the amount of Operating Costs actually incurred
for the preceding calendar year and Tenants Share thereof, ,and (c) to the extent applicable, the
amount overpaid or underpaid by Tenant on account of Tenant's Share of the Operating Costs
actually incurred for the preceding year. In addition, beginning on the first day of the first
calendar. month which is at least fifteen days after Sublessor's statement is furnished and
continuing on the first day of each subsequent calendar month, Tenant shall pay {fj an amount on
account of the estimated Tenant's Share of Operating Costs for the current year calculated by
dividing the estimated Tenant's Share of Operating Costs for the current year. by the number of
full calendar months during the Term in that year. Deficiencies in prior payments during the
current year before the sums described in part {f) become payable shall be calculated on the basis
of there being due an the first day of each calendar month during the. current year the amount
specified ict part (~, Until Sublessor's statement under this paragraph is furnished, Tenant shall
pay together with and when the $ase Monthly Rent is due for the current year the amount which
is equal to that amount payable by Tenant in the last month of the preceding year for estimated
Operating Costs for the preceding year. Any adjustments in actual costs .will be prorated on the
next years NNN costs.
8.3.3 Overpayments for Preceding Year. If Sublessor's statement
furnished according to paragraph 8.3.2 shows estimated payments made by Tenant on account of
Operating Costs in the preceding year were more than Tenant's Share of the Operating Costs for
the preceding year, then Sublessor shall apply the excess to sums then due for the current year
~. anri to the PY±P„+~~an3~r~m~ing-balance-ofsueh-exeess;-xt Subiessorzs-elECt~on; either-refund~ --
the balance to Tenant or apply the balance to the sums next due from Tenant for the current year.
The obligations with respect to Operating Costs for the calendar year in which the Term expires
or is terminated survive such expiration or other termination of this Sublease. Any adjustments
in actual costs -will be prorated on the_ next years NNN costs.
8.4 Tenant's Ri~E-t of Review. ~ As provided in and subject to the conditions
of this paragraph 8.4, Tenant shall have the right to examine Sublessor's books and records far
the purpose of reviewing the accuracy of Sublessor's statements of actual Operating Costs ("Cost
Statement"). Within thirty days after Tenant's receipt of a Cost Statement, Tenant shall by
written notice ("Review Notice") to Sublessor make its election to examine Sublessor's books
and records for the purpose of reviewing the accuracy of Cost Statement. Within IO days after
receipt of the Review Notice, Sublessor shall by written notice ("Records Notice") describe the
10
location ar locations at which Sublessor shall make i#s books and records available for such
examination. Within forty-five days after receipt of the Records Notice, Tenant shall complete
its examination and give Sublessor a written report thereof ("Objection Notice") in reasonable
detail stating the amount of Operating Costs for the preceding year according to such
examination and the reasons and amounts for any variation from the Cost Statement. Sublessor
will make its books and records available for Tenant's examination and copying at reasonable
times on reasonable prior notice at such place or places where such books and records are kept in
ordinary course. Tenant's examination shall be made by an independent certified public
accountant selected by Tenant and the costs and fees thereof shall be paid by Tenant except as
provided otherwise in the next sentence. If as a result of Tenant's examination, it is adjudicated
or Tenant and Sublessor agree the Cost Statement overstated the amount of Operating Costs
actually incurred for the year in question by an amount exceeding five percent of the Operating
Costs claimed by the Cost Statement, then Sublessor shall reimburse Tenant's reasonable costs
and fees of its examination. To the extent that as a result of Tenant's review it is adjudicated or
Sublessor.and Tenant agree that there was such an overpayment, then notwithstanding anything
else to .the contrary in this Sublease, there shall be. credited to all sums then due from Tenant to
Sublessor (and to the extent of any balance, all sums next becoming due from Tenant to
Sublessor) the amount of such overpayment, If Tenant does not timely give a Review Notice
with respect to a Cost. Statement or if Tenant does not timely give its Objection Notice with
respect to a Cost Statement, then Tenant is and shall be barred. from (and waives, releases, and
discharges any claim of right) to challenge the accuracy. of that Cost Statement. Even if Tenant
exercises its right to examine Sublessor's books and records concerning actual Operating Costs
incurred for the previous year, Tenant shall nevertheless pay when due all sums indicated by that
state,~ent and any subsequent statements as being due from Tenant for the preceding and current
years, all when and as provided in paragraphs 8.3.2 through 8.3.4, and shall not delay or make
any deductions from such amounts.
9. LEASEHOLD EXCISE TAX. Ln' addition to the Base Monthly Rent, Tenant
shall pay to Sublessor in advance on the firs# day of each month during the Tenn the leasehold
excise tax required by Chapter 82.29A of t17e Revised Code of Washington and regulations
adopted pursuant thereto, as such law and/or regulations may hereafter be amended or replaced,
on account of the taxable rent payable by Tenant under this Sublease on such data For
- --inf~rrr-atiet3al -purposes; the current-rate-of the loasehold - ------
. p r en .
10. PEkMITTEID USE. The Premises shall be used only for the_use specified in
paragraph 1.12 (the "Permitted Use"), aril for no otherbusiness or purpose without the prior
written consent of Sublessor, which Sublessor may refuse or condition in its discr-etion.
11, RE UIRElVIENTS CONCERNIlVG TENANT'S USE.
11.1 General Matters. Tenant shall not do or suffer anything to be done in the
Premises or the Parking Garage or on or about the Auburn Transit Station that will increase the
insurance rates for or cause any insurer to cancel or to impose exclusions on any of Sublessor's
policies of insurance on or relating to the Property or any part thereof or the Sublessor's contents
therein or Sublessor's liability insurance related to the Property or any part thereof. 1^or fhc
purposes of the preceding sentence, to the extent that Sublessor self insures any risks jointly with
other governmental units and pays assessments relating to such self-insurance, then in the
preceding sentence the term "premiums" includes such.assessments. Tenant shall not in any way
exceed the design load limits of the floor of the Premises. Tenant shall not commit or permit
waste of any part of the Property. Tenant shall not commit or permit any public or private
nuisance or any other act or thing that obstructs, interferes with, or otherwise disturbs (in
Sublessor's good faith. opinion) any of the other. tenants of the Commercial Tenant Area and/or
Plaza Tenant Area or any of their licensees, permittees or invitees in their use, occupancy, or
enjoyment o~'~heir respective premises, the Common Areas or which (in Sublessor's good- faith
opinion) interferes with Subiessor's ownership or operation of the Building. Tenant shall not
commit or permit any act or thing that obstructs, interferes with, or otherwise disturbs {in
Sublessors good faith, opinion) Sound Transit ~or any of its .tenants, licensees, permittees or
invitees {including members. of the general public) in their respective use, occupancy, or
enjoyment of the Parking Garage or any other part of the Auburn Transit Center Station (except
as permitted in the Plaza Tenant Area Rider}. Tenant shall not. use or place any apparatus,
machinery, or device which causes any substantial noise or vibration in or about the Property
wi#hout Sublessor's priorwritten consent, which Sublessor may refuse or condition in its
discretion. Tenant shall at all times keep access to enclosures within the Prerruses for any
Parking .Garage systems .that are excluded from the Premises, if any, free from obstruction or
hindrance, and Tenant shall not keep, place, or store anything in such enclosures. Tenant shall
comply with and shall cause its employees, agents, visitors, and contractors to comply with such
reasonable rules as Sublessor from time to time may deem necessary or desirable for the
protection of the Leased Premises, the Common Areas, other parts of the~Parlcing Garage and/or
the Plaza Tenant Area, its -safety, care, and cleanliness, and good order therein. A co
Sublessor's rules.presently in effect is attached hereto as Exhibit D: py of
1i.2 Corrtpliahce With Law. Without limiting the generality of any provision
of paragraph 11.1, in its use and occupancy of the Premises, the making of any Tenant
Alteration, and Tenant's performance of its obligations under~this Sublease, Tenant shall conform
to and comply with every applicable Law, including but not limited to state and federal
occupational and health safety acts and the Americans With Disabilities Act. Tenant recognizes
that the Americans With Disabilities Act may require modifications be made to the Premises
because of Tenant's use (hereof and, in such case, Tenant shall at its expense make such
_ r. modifications_(,~~bj~~, how~y~,, to the,~~uirements_-of .paraggraph-16}; ~~ ~~~etment-or --
enforcerrient of any Law requires any changes to the Premises during the Term, then, subject to
the requirements of paragraph 16, Tenant shall make all such changes a# ~ its expense if the
changes are required due to the nature of Tenant's activities at the Premises, Qr to Tenant
;4lterations that were made by Tenant or that Tenant seeks.to make. _ _
i1.3 Environmental Matters. Without limiting the generality of any
provision of paragraph l I.I or l I.2, Tenant shall comply, and shall cause alI its employees,
contractors. and agents to comply, with alI requirements of every applicable Law concerning use,
handling, storage, disposal, removal, and encapsulation of any hazardous, toxic, or dangerous
substance or waste brought onto, released onto, used in or about, ~or generated in or about _the
Parking Garage or the Auburn Transit Center by Tenant or by any of its employees, agents,
visitors, or contractors, or by any other person with Tenant's consent or permission, express or
implied. Tenant shall indemnify, defend, and hold harmless Sub]essor, Sublessor Related
l2
-...-'_-ii-~.._....~ ~ ~.-vvv
Parties, and the Property from and against all demands, claims, liabilities, damages, awards,
judgments, costs, and expenses incurred by or. asserted against Sublessor, Sublessor Related
Parties, and/or the Property arising from or in any way related to any failure by Tenant or any of
its contractors or agents to perform as required by the preceding sentence or arising from or in
any way related . to the assertion of any such failure. Tn the preceding. sentence: (a) "costs"
include, but are not limited to, fines, penalties, costs of any investigation, costs of any remedial
action, costs of restoration or replacement of any part of the Auburn Transit Sta#ion or any
improvements thereon (including but not limited to the Parking Garage), and the costs of
settlement; and (b) "expenses" include, but are not limited to, the costs and fees of attorneys,
consultants, experts, and witnesses. Tenant's obligations under this paragraph survive the
expiration or termination of this Sublease-
. 12. COMMON AREAS. Tenant shall have the right to nonexclusive -use of the
corridor portions of the Common Areas for ingress and egress to the Premises; provided that
such use shall not interfere with the reasonable use of such areas by other tenants of the Building.
'T'enant shall also have the right to nonexclusive use of the other Common Areas for the uses for
which they are intended and provided by Sublessor from time to time. Sublessor reserves The
right from time to .time.to change the size, location, nature, use,~configuration, or otherwise alter
the Common .Areas and may change the Common Areas available to tenants of the Commercial
T'enan# Area and may eliminate or reduce parts of the Common Areas, erect improvements on
the. Common Areas or .convert any portion of the Common Areas. to the exclusive use of
Sublessor or one or more tenants of the Commercial Tenant Area. 1~Towever, Sublessor shall not
make any changes to the Common-Areas that unreasonably interferes with Tenant's access to the
Premises or other rights under this Sublease. Sublessor reserves the use of exterior walls, the
interior of the demising walls, and the right to install, maintain, use, repair and replace pipes,
ducts, conduits, and wires leading through the Premises in areas which will not materially
interfere with Tenant's use thereof.
13. REPAIRS A1VD CARE OF FREMISES, Tenant shall at its expense maintain,
take good care of and keep in good condition, good state of repair and good working order the
Premises and the fixtures and appurtenances therein or related thereto, including but not limited
to: (a} floor coverings; {b) window coverings; (c) interior walls and partitioning; {d) doors (if
~~TM~go- is-caused-1}y-the~enantj;-{e}-relights-and-vthor-glass-(including-exterior-win-da
da.rnage is caused by the Tenant); (~ the interior side of demising walls; (g) electronic, phone,
and data cabling. and related equipment installed by or for the exclusive benefit of Tenant,
wherever located in the Parking Garage (collectively "Tenant Cable"); (h) any supplemental
heating or air-conditioning equipment, private showers and kitchens, including ho#:water heaters,
plumbing, and similar facilities serving Tenant exclusively; {i) all Tenant Alterations, whether
made with or without Sublessor's consent, including any related balancing of the heating and air-
conditioning systems serving the Premises and/or any other part of the Parking Garage, (j) any
ventilation equipment installed by or for the exclusive benefit of Tenant, wherever located in the
Parking Garage, and (k) wires, cables, conduits, pipes, valves, faucets, and other components of
the systems providing utilities. Tenant shall not make holes in or fasten hardware, bulletin
boards, shelving, cupboards, blackboards, decorator ifems, or any other object to the walls,
doors, woodwork, or ceilings or hang things from ceiling support fr-arnes without Sublessor's
prior written consent, v~fiich Sublessor may refuse or condition in its discretion. Sublessor
13
hereby consents to the hanging from walls of the Premises pit=tares and other decorator items
weighing ~Iess than'25 pounds each using picture books fastened to the-walls with nails.. All
damage or injury to any part of the Premises or the Parking Garage caused by any such holes or
fastenings (including any consented to by Sublessor), or by installation of Tenant Cable or other
of Tenant's equipment and fixtures, or by moving Tenant`s fiutiiture, equipment, supplies or
inventory into or about the Parking Garage or the Premises, or by the act or omission of Tenant
or any of its employees, agents, visitors, contractors, or customers .shall be repaired at Tenant's
expense. Work of repair or replacement shall be performed by firms and workmen selected;
engaged, and supervised by Sublessor. Sublessor has no obligation during the Term to: (i)
clean, repair or replace carpets, other floor-coverings, drapes, other window coverings or
treatments in the Premises even if furnished by Sublessor; (ii} to make any improvements to the
Premises, or {iii) repaint walls or refinish woodwork in the Premises. Subject to all the
preceding parts of this paragraph, Sublessor shall maintain the Property in good order and repair.
Tenant shall promptly notify Sublessor of any matters in or about the Property in need of
maintexiance ~ for which Sublessor is responsible and of which Tenant learns or has notice.
Notwithstanding the preceding provisions of this paragraph, to the extent maintenance of any
part of the Property or the Parking Garage that is under the provisions of this paragraph the
responsibility of one patty is required because of the act or neglect of the. other party (or the otheF
party's agents, contractors, invitees or licensees), then the other party shall pay the costs thereof.
At the election of the party otherwise responsible for such maintenance, the other party's
payment of the costs shall be made (a) within ten days after demand which demand is made after
completion of the wont and final determination of the costs thereof or (b} in installments as and
when due as the work progresses.
14. SERVICES AND >LITILITIES.
.14:1. General Provisions. Sublessor has the exclusive right to determine who'
shall provide electricity or any other utility service to the Property or any part thereof and who
shall provide facilities at the Property or any part thereof for broadband access to the lntemet
(excluding any such access which is availab'Ie through ordinary telephone Lines or television
cable} and to negotiate and enter into contracts or other agreements or arrangements therefore.
Sublessor shall provide facilities to furnish to the Premises and the Common Areas (a) electricity
for li~htingand customary ~uinme~nt, c~mn~ters,~aohinesand~tl~,er_devises-usual-and-otdirr
to retail and/or general office use of space in buildings in the general area of downtown Auburn
and (b} water. Sublessor shall provide (c) Lamp repIaeement service for light fixtures in the
Common Areas, {d).cleaning and supplying the restrooms that are part of the Conunon Areas,
and (e} air-conditioning and heat to the Premises and the interior Common Areas Tenant shall
provide facilities for fiarnishing all other utilities to the Premises, including but not limited to
telephone and, if available, television cable service and any other services that Tenant requires or
desires with respect to the Premises (including but not limited to janitorial and window-cleaning
services). Tenant shall- make arrangements with those providing the utilities and other services
to the Premises for the provision of such utilities and other services and shall pay when due all
fees and charges for utilities consumed in or services provided to the Premises, including but not
limited to any utilities provided by the City of Auburn.
I4
14.2 . Ener Conservation. After IO p.m. (or later) until. 7 a.m. (or
earlier) during weekdays and Saturdays and all day on Sundays and holidays, Sublessor may
reduce heating anti air-conditioning service and may reduce or turn off lighting in the Common
Areas. Froze tune to time Sublessor may institute and change other ,measures to conserve
energy, water, or other utilities and Tenant shall comply therewith..,
14.3 Excess Re alrements. Except as provided in subpart (a) of the fast
sentence of this paragraph, Sublessor is not required to provide air-conditioning or facilities for
electricity for other computers or equipment installed by Tenant. If Tenant installs any such
other computers or equipment. or other heat generating equipment, machinery, ~ or other devices
which it~aterially increases the load on-Sutilessor's present air-conditioning equipment or if
Tenant installs any devices which require greater eleotric service than -that described above,
Sublessor leas the election to do -any one or more of (a) require that Tenant remove such
computers, equipment, machinery, or devices, (b) make at Tenant's expense necessary
improvements or replacements to the air-conditioning equipment serving or electric service to
the Premises, and (c) charge Tenant for such extra load which charge shall be conclusive on
Tenant if established by Sublessor in good faith with the objective of reasonable reimbursement
of Sublessor's additional expenses (including but not limited to extra expenses of additional
maintenance). If Sublessor .makes this Last election, Tenant ~ shall ~ pay the charge monthly in
advance as Additional Rent an the f~st'day of each calendar month during the 't'erm.
1.4.4 Failure or Interru lion of Utilities or Sez-vi!ces. Sublessor shall not be
liable for and Rent shall not abate, in .whole or in part, because of any loss, injury, or damage
regardless of the nature thereof caused by or resulting froze, in whole or in part, any variation in,'
interruption of, or failure of any utility service or services described iri this paragraph 14 to be
provided by Sublessor incident to making of repairs, alterations, or improvements, or because of
accident, strike, or any other event or circumstance beyond Sublessoi-'s reasonable control.
15. LIMITATION QN SUBLESSUR L)(A.BTT,ITX. Rent shall not abate, in whole
or in part, nor shall there be any allowance'to Tenant for diminution of rental value, nor shall
Sublessor be otherwise liable to Tenant by reason of inconvenience, annoyance, loss of use of
the Premises, or interference wifh Tenant's business arising from the making {whether . by
-----~blessor;-Seund~ransi~-er- ~riy-other--perso~}~y~-repairs; ~aiter~atidrrs~ ~d~titia~zs; -o~-- --~
improvements to any part of the Station. Sublessor and Sublessor Related Parties shall not be
liable to Tenant for and Rent shall not abate, in whole or in part, because of any damage to any
part of the Station or loss of use of any part,of the Property ar the Premises or for any lass,
damage, or injury to Tenant or any of its property or its business occasioned b}c (a} bursting,
rupture, leakage, overflow, or other failure of any plumbing or other pipes ar appurtenances,
including without limitation, water, sewer, refrigerant, and fire,spritzlder systems, water tanks,
and dishwashers; {b) backing up of any sewer line, drain, drainpipe, downspout, or gutter; (c)
water, snow ar ice upon or coming through the root; skylights, stairs, doorways, windows, walks,
or any other place on the Property; or (d) any act or omission of any party other than Sublessor
or Sublessor Related Parties. Sublessor and Sublessor Related Parties shall not be liable for and
Rent shall not abate, in whole or in part, because of any Loss or damage fo persori or property
sustained by Tenant or by any other person which may be caused in whole or in part by any part
of the Station, the Parking Garage, or the Premises being out of repair, by burglary, theft or
IS
vandalism, or by any act or neglect of the any tenant or other occupant of the Station or the
Parking Garage or any part of either, or of any other person, including but not limited to Sound
Transit and its agents, employees, and contractors. Tenant shall insure itself against the risk of
all such losses described in this paragraph.
16. TENANT ALTERATIONS. After completion of any Tenant Improvements
provided in the attached Tenant )<mprovement Rider, if arty, Tenant shall make no changes,
additions, alterations, or improvements in or to the Premises or any other part of the Property
. (including but not limited to the installation of any Tenant Cable) ("Tenant Alteration") without
Sublessor's prior written consent (which Sublessor may refuse or condition in its discretion) as to
the nature, extent, quality, plans and specifications of the proposed work, the materials to be
used, and whether any or all of such matters shall be removed and the affected parts of the
Property restored at Tenant's expense at the expiration or termination of the Term. "Tenant
Alteration" does not include installation of shelves; movable partitions, Tenant's equipment and
trade fixtures that may be, and are, installed without darrtaging the Property oz the existing
improvements therein or the structural, integrity of any part of the Parking Garage or the Station
and Sublessor's consent is not required for installation of such items. Tenant Alterations
consented to by Sublessor shall be made and installed at Tenant's expense but under the direction
and supervision of Sublessor by firms and workmen selected or approved by Sublessor. All
.Tenant Alterations shall become Sublessor's property at the expiration or termination of the
Term, subject to any obligation 'of Tenant to remove all or any part thereof and restore the
Property. Unless otherwise specified by Sublessor in its consent to a Tenant Alteration, the
Tenant Alteration shall belong to Tenant and, at the expvration or earlier termination of the `T'erm,
. .- Tenant shall at its expense remove the Tenant Alteration and restore the Property to its condition
before the Tenant Alteration. In addition and whether or not Sublessor approves all or any part
of the proposal, Tenant shall reimburse Sublessor's costs and fees of third parties engaged by
Sublessor to assist and advise Sublessor in its consideration of the proposal. Such
reimbursement shall be paid within fifteen days after Sublessor's demand therefore which shall
be accompanied by reasonable evidence of the amount and purpose of such costs and fees and
the identity of the persons rendering the services. If Sublessor consents to any Tenant Alteration,
then Tenant shall perform the Tenant Alterations in accordance with all applicable Law and in a
manner so as not to unreasonably disturb or interfere with other tenants or occupants of the
.` n.,rtr;r.g.F7arage-aF ari art-thereo gScnind~'rarrszt-and-zts~iicertsees ~nd~
3~P f {ineludin j, p~ayrtlre-cnsts -
thereof as and when due. Tenant shall also pay Sublessor a fee for Sublessor's oversight and
eooz-dination of the work of the Tenant Altera#ion in the amount equal to five percent of the cost
of the Alteration, Such fee shall be paid when the Tenant Alteration is completed and the total
cost. thereof is determined. Promptly after completion of each Tenant Alteration made by
Tenant, Tenant shall furnish to Sublessor as-built plans, drawings, and specifcations thereof.
The requirements of this paragraph are in addition to any requirement of Law that Tenant obtain
a permit from the City of Auburn acting in its governmental capacity for the proposed work.
Without limiting the generality of the preceding sentence, Sublessor's consent to such proposal
{with or without conditions) is not the equivalent of a permit or approval for such proposal in its
governmental capacity and does not obligate the City of Auburn to approve the proposal in its
governmental capacity under any such applicable Law and does not otherwise limit or prejudice
the City of Auburn's discretion or freedom of decision-nnaking acting in its govertunental
capacity pursuant to any such applicable Law.
1b
••....~~~..o.w a..~~ v,ql iuglY Ivy LVVJ
27.LIEI~CS. Without Sublessor's prior written consent thereto, Tenant shall not permit any
lien, encumbrance, security interest or claim thereof (collectively in this paragraph "lien") to
attach to the Property or any part thereof or to az~y fixture thereof or to ail or any part of Tenant's
rights to the Premises or under this Sublease because of any work done by Tenant or at Tenant's
request or because of any goods sold to or .leased by Tenant or because of any services rendered
to or at the request of Tenant or because of any loan made to or other debt incurred by Tenant.
Sublessor may refuse or condition any consent requested of it under this paragraph in Sublessor's
discretion. Promptly after Sublessor's demand, Tenant shall either ~(a) cause any claim of such .
lien which has been recorded in the real property records or filed iu the persozial property or
Uniform Commercial Code records of the county, the state, or any other public authority to be
released of record even if that cannot be done without paying the elaimant~ or, (b) to provide a
bond against any claim of such lien if a law or an agreement with the cIairnant provides the effect
of posting the bond has the effect of releasing the claim of lien from the property or rights
against which the lien was filed or otherwise created.
1$. ASSIGNMENT AND SUBLETTING.
18.2 General Provisions. None of Tenant`s rights or obligations under this
Sublease are assignable without Sublessor's prior written consent, which Sublessor may refuse or
condition in Sablessor's -discretion. Any assignment made without Sublessor's consent or
without the occurrence of all conditions to such consent. shall'be void and of no force or effect
whatsoever, except Sublessor may at Sublessor's election treat such attempted assignment as a
breach as provided in paragraph 29. Any consent given by Sublessor to an assignment shall
apply only to the specific transaction then. consented to and sha1I not be a consent to any other or
further assignment. Despite any assignment, with or without Sublessor's consent, Tenant shall
remain fully and primarily liable to Sublessor for ail obligations. of the Tenant under this
Sublease jointly and severally with the assignee and its successors, if any, even if such
obligations were assigned to and assumed by the assignee. Regardless of whether Sublessor
consents to the request, Tenant shall reimburse Sublessor's costs and fees of third parties
engaged by Sublessor to assist Sublessor in its consideration of the request. Such reimbursement
-shall-be-paid-wi#2rzrrfiffe~en~3~ys~#i~er-Sujsl-~sor s'---demand-th re ore w ~ch`s1~tl~~be accomparue
by reasonable evidence of the amount and purpose of such costs and fees and the identity of the
persons rendering the services.
28.2 Definitions. For the purposes of this Sublease, "assignee." includes an
assignee of an assignee as well as an assignee directly of Tenant and "assignment" includes
without limitation any of the following: {a) creation of any mortgage, deed of trust; or other
security interest in all or any part of Tenant's rights under this Sublease; (b) a subletting of all or
any part of the Premises; (c) the use or possession with Tenant's permission, consent, or
acquiescence of all or any part of the.Premises by any person or entity other than Tenant; (d) if
Tenant is a corporation, limited liability company, or limited partnership any change in Tenant's
identity by merger, consolidation, or dissolution; (e) if Tenant is a corporation, any change after
the date of this Sublease of ownership of Z5% or more of the corporation's shares of stocfc,
whether such change occurs by transfer of existing shares or issuance of new shares or a
17
combination thereof or in one or more transactions or at one time or over any period of time; {fj
if Tenant is a limited liability company any change after the date of this Sublease of ownership
of 25% or more of the company's membership interests, whether such change occurs by transfer
of existing interests or issuance of netiv interests or a combination thereof or in one or more
transactions or at one time or over any period of tirrAe; {g) if Tenant is a partnership (general or
limited) or a joint venture, any change after the date of this Sublease in its general partners or
joint venturers; and (h) any transfer by operation of law. For the purposes ofpart (g}, if a general
partner or a joint venturer is a corporation or a limited liability company, a change in identity and
a transfer of ownership interests as described in parts (d), (e), and (f} shall each be considered a
change in the general partner or joint venturer.
19. .SURRENDER. On expiration or earlier termination of the Term, Tenant shall:
19.1 quit and surrender the Prerriises broom clean and otherwise in the same
condition and in as goad order and repair as at the commencement of the Term or, if applicable,
as at the completion of .any repairs or restoration after damage under paragraph 21 or
condemnation under paragraph 22, excepting only ordinary wear and tear, damage from fire or
elements, and alterations or other changes which are to remain under paragraph I5;
19.2 deliver to Sublessor all keys and other items or devices opening or
operating any door, lock, or other security device pertaining to the Premises or the Parking
Garage; and
19.3 remove all its property from the Property and the Parking Garage.
Any maintenance or restoration of the Premises required to conform to the requirements of the
preceding or to repair any damage to any part of the Property caused by Tenant or any of its
employees, agents, invitees, licensees, or contractors or to bring the Premises and all components .
and systems thereof to the condition they would. have been if Tenant had fully and faithfully
performed its obligations under paragraphs 1~ and 16 shall be performed by firms and workmen
selected, engaged, and supervised by Sublessor but at Tenant's expense. If Tenant fails to
remove its property, then Tenant shall be deemed to. have abandoned the same and Sublessor
- "~a-; renwv-emend-store tlto-sarxre-At~T~nant'~isk-and-e~cpertse~rsell tbe-samevr-discard-the~samE.
All of the foregoing obligations and alI obligations to make or pay,for repairs under paragraph
14, to restore the Premises under paragraph 16 survive expiration or termination of this Sublease
and to indemnify Sublessor under paragraph 24.
20. ' SUBLESSOR'S ACCESS. After not less than two days' prior notice {except iri
the case of emergency in which case no prior notice is required} Sublessor and its employees,
agents and contractors shall-.have the right of access to the Premises and Tenant shall permit
Sublessor and its employees, agents and contractors to enter the Premises at all reasonable times
for the purpose of inspecting, main#aining, altering, or improving the Premises, the Property,
equipment or fixtures, or showing the Premises to prospective purchasers, lenders or any other
person having a legitimate interest therein, or exercising any of Sublessor's rights herein or under
Law. After not less than ttivo days' prior notice, Sublessor and its employees and agents shall
have the right of access and Tenant shall permit such access to _the Premises for the purpose of
18
showing them at any' time to prospective purchasers, lenders or any other person having a
.legitimate interest therein or showing them at any time within the six months before expiration or
sooner termination of the Term. Tenant shall not alter or make any other changes in any locks or
other security devices or install additional Locks or other security devices in any door anywhere
in the Premises or the Parking Garage. Nothing in this paragraph imposes any obligation on
Sublessor to perform any maintenance or to make any alteration or improvement that Sublessor
is not otherwise obligated to perform under some other provision of this Sublease or by Law.
Approval of installation of additional tenant security shall not be unreasonable denied.
. 2Y. DAMAGE AND" DESTRUeTIQN. If any part of the Premises or of the
Property or ofthe Parking Garage is damaged or destroyed by fire or any other casualty during
the Term, Sublessor shall have the election whether to repair or rebuild or to terminate this
Sublease and the Ter~x- effective as of the date of the casualty. Sublessor shall give Tenant notice
in writing of its election within Winery days after the date of the casualty. If Sublessor does not
give its notice within such period, as Tenant's sole and exclusive right and remedy on account of
such casualty, Tenant shall. have the right.to declare this Sublease and the Term terminated as of
the date of the casualty by giving notice of termination to Sublessor but only if Tenant's notice is
given before Sublessor gives Tenant Sublessor's notice of election, In case of termination under
this paragraph liy Sublessor or by Tenant, Tenant shall pay Rent and otherwise perform all of its
obligations under this Sublease up to the effective- date of termination (and those that survive
sueh.termination) and Sublessor shall refund any Rent previously paid which is applicable to the
period after such date. In addition, if all or a part of the Prerruses are tenantable despite the
casualty and Tenant uses all or any.part of the Premises despite the casualty, Tenant shall also
pay Rent and perform its other obligations under this ."Sublease through the date Tenant
" surrenders the Premises after termination under this paragraph. In such cases, Kent shall abate in
the proportion, if any, that the untenantable part of the Premises bears to the whole thereof unless
the .damage or destruction results from, or is contributed to directly or indirectly by the act, fault
or neglect of Tenant or any of its employees, agents, invitees, customers, licensees, pennittees or
contractors (in which case there shall not be any abatement of Rent). If Sublessor elects to repair
or rebuild, that work will be accomplished with reasonable promptness and during the period
from the date of the casualty to the date the work or repair or rebuilding is substantially
completed, Base Monthly Rent for the Premises shall abate "in the same proportion as the
ntenantable-portion-o-Fth~Prensisos~ -if-att~b~~s-tfl,tlze_wholo._th~reo , ~hts u "]ease s a
remain in full force and effect. If Sublessor elects to repair or rebuild, such repairs or rebuilding
shall include the Tenant Improvements {if any and to the extent damaged or destroyed) but
otherwise Sublessor has no obligation to repair, rebuild, restore, or replace any fixtures or other
property of Tenant or any improvements or alterations to any part of the Property made by
Tenant or at Tenant's request or at Tenant's expense. Sublessor shall not be liable for any
damages or compensation for annoyance or inconvenience, loss of use of all or part of the
Premises or Common Areas, or loss of business of Tenan# by reason of or arising from the
casualty or of the repairs or rebuilding.
22. El1~lINENT DOMAIN. If all of the Premises are taken by any person or public
authority under the power of eminent domain, then the Tenn and this Sublease shall terminate as
of the date the taking person or authority is entitled to possession under such power. 1f any part
of the Premises, the Property, the Parking Garage or any of Sublessor's interest therein shall be
19
taken by any person or public authority under the power of eminent domain, Sublessor may elect
to terminate this Sublease and the Term as of the day such person or authority is entitled to
possession under such power. A "taking" under this paragraph includes but is no# limited to~a
conveyance made by Sublessor to a grantee under threat of the exercise of the power of eminent
domain. Sublessor shall give Tenant written notice of its election within sixty days after the
condemning person or authority gives Sublessor written notice of the final extent of the taking or
sixty days before the date such person or authority shall be entitled to possession, whichever is
Later. If Sublessor does not give Tenant Sublessor's notice of election within such period, then as
Tenant's sole and exclusive right and remedy on account of such taking, Tenant shall have the
'right to declare this Sublease and the Term terminated as of the date the taking authority is
entitled tb possession by giving notice of termination to Sublessor but only if Tenant's notice is
given before Sublessor gives Tenant Sublessor's notice of election. Notwithstanding the
preceding-provisions, Tenant shall have the right to terminate this Sublease and the Term
terminated as of the date the taking authority is entitled to possession thereof by giving notice of
.termination to Sublessor (but only if Tenant's notice is given within thirty {30) days after Tenant
is given written notice of the final extent- of the taking or sixty (ti0) days before the date the
taking authority is entitled to possession, whichever is later) in the event of a taking which
includes {a) part of the Premises and {b) {i) more than twenty percent (20%) of the floor area of
the Premises is included in the taking or {ii) the .taking person or authority is entitled to
possession of any part of the Premises on a date that is within six months of the expiration date
of the then existing Term. Tn addition, and notwithstanding any of the preceding provisions of
this paragraph, Tenant may terminate the Term and this Sublease if not previously tenniuated the -
taIcing includes a part of the premises and Sublessor has not completed any resto><^ation of the
- remaining part of the Premises within six months after'the date the taking person or authority
was entitled to possession of the part of the Premises that were taken. Tenant's election under
.the preceding sen#ence may be made only by written notice of termination specifying an
effective date of temunation which is at least two weeks after such notice which notice is given
to Sublessor after the date the such six month period has elapsed without restoration having been
accomplished bu# not more than thnty days after such date. ~ In addition, Tenant's notice of
.terminate shall be void and of no force or effect if Sublessor completes the restoration before the
effective date specified in Tenon#'s notice. Sublessor shall be entitled to all compensation or
damages awarded for any taking, except that Tenant is entitled to any award which is both (a)
---~oparately-made ur~dditien-to-the-valuero€ the~roperty-taicetr(and; -if=apPiicahle;~iarrrago-to the--~ `~--
remainder of Sublessor's Property) and (b} identified as (i) compensation for Tenant's relocation
expenses or {ii) compensation for the taking of Tenant's fixtures. If the Term and the Sublease is
terminated as provided in this paragraph, then Tenant shall pay Rent and otherwise perform a1I of
its obligations under this Sublease up to the effective date of such termination. {and those that
survive such termination) and Sublessor shall refund any Rent previously paid which is
applicable to the period a8er such date. If the taking includes a partial taking of the Premises
and the Term and this Sublease is not terminated under the provisions-of this paragraph, then the
Base Monthly Rent shall be reduced in proportion to the amount of the Premises taken, Sublessor
shall make appropriate restoration of and alterations to the Property and the part of the Premises
remaining, so that the remaining parts of the Property and the Premises are a functional whole
for the purposes of the Permitted Use, and this Sublease and the Term shall otherwise continue
with respect thereto.
20
23. IhISUR.ANCE.
23.1 Liabili Insurance. At all times during the Term, at its expense Tenant
shall obtain and maintain in full force and effect a policy of general commercial liability
insurance insuring the activities of Tenant, its employees, agents, visitors, and contractors in,
about, upon, and with respect to the Premises, the Property and the Station against liability for
personal injury and death and loss or damage to property, including liability for operation of
owned and rionowned motor vehicles and coverage for contractually assumed liabilities. Such
policy shall name Sublessor and Sound Transit as additional insureds. Such policy shall also
.provide the insurer's obligation to pay all defense costs in addition to limits of coverage for
• liability. Such policy shall have limits of coverage of not less than $2,000,000 for personal
injury or death and $3,000,000 for loss or damage to property for a siztgle occurrence and shall
have only those deductibles of kinds and amounts reasonably satisfactory to Sublessor.
23.2 Pro ert Insurance. At all times during the Term, at its expense Tenant
shall obtain and maintain in full force and effect a policy of property insurance insuring alI
'Tenant's property located in or about the Premises, the Property and the Station against Ioss by
fire or other casualty, theft, vandalism, and other hazards covered by an "all risk" form of such
policy with limits of liability equal to the fuI] replacement value of such property without
deduction for. depreciation and with such other deductibles of kinds and .amounts reasonably
satisfactory to Sublessor. Such policy shall include coverage for losses due to business
interruption.
23.3 tether Tenant Insurance. Sublessor has the right to require Tenant to'
obtain and maintain such other insurance and bonds {such as but not linuted to professional
liability insurance and/or fidelity bonds) as Sublessor in good faith.deterrnines reasonable and
appropriate to the particular type of business in which Tenant is engaged. Such other insurance
.and bonds shall have such limits, deductibles, and other provisions as are usual and ordinary to
such matters but consistent with the nature, size, and scope of Tenant's business, all as
determined by Sublessor in good faith. In this paragraph, "policy" includes any such bonds.
23.4 Proof of Insurance. Tenant shall deliver to Sublessor before the Term
--------coim~ences--and~efore-Tenant-occupies~~ ~rs~os~n
~~ o e r raises or any purpose copies
of the policies required of Tenant under this paragraphs 23 and the respective insurer's written
certification to Sublessor that the policy is in full force and effect with premiurris fully paid. At
the same time, Tenant shall also deliver to Sublessor proof reasonably sa#isfactory to Sublessor
that Tenant did not borrow money to pay the premiums for such polices or~.that any such
borrowing has been fully repaid or otherwise satisfied. Not later than thirty days before
expiration or any earlier cancellation of each policy, Tenant shall deliver similar copies,
certifications, and. proof of and concerning a renewal of or replacement for each insurance policy
required by this paragraph. From time to time, Sublessor may request a copy of one or more of
Tenant's policies of insurance required under this paragraph 23 certified by the insurer to be a
true and correct copy of the policy and all endorsements and amendments thereto and Tenant
shall promptly comply with such request.
23.5 Re ~iirements Concernin Tenant's Insurance Policies.
21
_...__ _._J, ....~ ~......~ ~v, c.VVJ
23.5.1 General I2eatiirements. Each policy of insurance Tenant is
required to maintain under this Sublease shall: (a} be issued by an insurance carrier reasonably
'satisfactory to Sublessor; (c) provide that the policy is primary and not e~ccess to or contributing
with any of Sublessor's insurance policies or Tenant's other insurance policies; and (c) include a
provision that requires the insurance carrier to give Sublessor riot less than thirty (30) days'
written notice before the effective date of any cancellation (including but not limited to
cancellation for nonpayment of premium) or of any modification of such coverage (including.but
not limited to a chaiage in deductible amounts).
23.5.2 O tional Reined For Breach. If Tenant fails to obtain and
continuously maintain any policy of insurance required of it, Sublessor may obtain such
insurance, in which case the Tenant shall reimburse Sublessor for the cost of such insurance
within fifteen (15) days after receipt of an invoice therefor accompanied by a copy of the
premium statement or other evidence of the cost of such insurance.
23.5.3 Nanun Governtuental Unit. As Additional Insured. Each
policy. required of Tenant under this Sublease that is to name either or both of Sublessor or
Sound Transit as additional insured shall expressly name as additional insured Sublessor and/or
Sound .Transit, as applicable, and all members of their respective council or other legislative
body'and all of their respective officers, directors, employees and agents. .
23.5.4 Waiver of Subro anon.. Unless prohibited under the applicable
insurance policy, Sublessor and Tenant each hereby releases and waives any and all rights of
recovery against the other (and their respective officials, officers, employees, agents and
representatives), for loss of or damage to its property or the property of others under its control,
if such loss or damage is covered by any insurance policy in force (whether or not described in
this Sublease} at the time of such loss or damage or would have been covered if the party had
obtained the insurance it was required to obtain under this Section 3.3. Upon obtaining..the
policies of insurance required or permitted in this Section 3.3, the parties shall give notice to
their respective insurance carriers of this mutual release and waiver of subrogation and use
reasonable efforts, including payment of any additional premium, to cause their respective
-"---~3suranGe-cantors-ta-consent~to t1to~~visions o 's sup o stare in e r m
the release and waiver in this subpart shall not be effective if the effect would be to vo ~
coverage under the policy. In addition, the release and waiver in this subparagraph do not apply
to the extent of the. deductible amounts to any such policies or to the extent of liabilities
exceeding the limits of such policies_ For the purpose of this provision, seltizzstirance by
Sublessor is no# the.equivalent of having an insurance policy.
24, INDEMNIFICATION.
241 General. Tenant shall defend, indemnify, and save harmless Sublessor
and Sublessor Related Parties from and against: {a) any and all demands, claims, liabilities,
damages, and judgments, including without limitation for injury to person or property, arising
from or related to (or alleged to have arisen from or be related to) any act or omission of Tenant
or any of Tenant's employees, agents, visitors, invitees, licensees, perznittees or contractors; (b)
22
vveunesaay, aanuary 15, 2003
any and all losses, damages, and costs arising from or related to any breach of or default. in any
of Tenant's obligations under this Sublease; and (c) any and all expenses incurred by Sublessor
arising from or related to any such demand, claim, liability, damages, judgment, Ioss, or cost or
arising from, or related to any such breach or, default. In the preceding sentence, "expenses"
include, without being limited to, the fees and costs of attorneys, consultants, experts, and
witnesses. Tenant's obligations under this paragraph survive the expiration or other termination
of this. Sublease. In the case of concurrent fault of Sublessor and Tenant (and their respective
employees, agents, visitors, invitees, licensees, permittees and contractors), Tenant's obligations
under part (a) of this paragraph do not extend to any demand, claim, liability, or judgment for
which Sublessor is or would be severally .liable only for Sublessor's proportionate share of the
total damages under the provisions of Chapter 4.22 Revised Code of Washington. However,
Tenant's obligations under this paragraph extend to that part of Sublessor's several liability
which is in excess of what it what have been if determined by taking into account Tenant's
proportionate share despite any immunity of Tenant to the claimant under Title 51 Revised Code
of Washington. Tenant's obligations under this paragraph are not limited in any way' by the
requirements of or by Tenant's compliance with the requirements of paragraph 23.
24.2 Waiver of Immunity. Tenant's obligations under paragraph 24.1 extend
to, without limitation, injuries to Tenant's employees (as such employees are defined iir the
Industrial- Insurance Act (Title 51 Revised Code of Washington) and, to that extent and for the
benefit of Sublessor and Sublessor's employees, agents, and contractors, Tenant hereby waives
the immunity otherwise afforded Tenant under that Act or any other applicable workmen's
compensation laws.
25. TENANT TAXES AND O'TH>~R GOVERNMENTAL CHARGES. Tenant
shall pay when due all taxes, assessments, license fees and other governmental charges
{including any imposed by the City of Auburn in its governmental capacity) on or with respect to
Tenant, any of Tenants property, Tenants income, gross receipts, or other revenues, Tenan#`s use
of the Premises, and Tenant's business. ,
26. SIGNS.
~~ ' --2t;.I~ genera equrremen s. xcept as provided in this paragraph 26, Tenant
shall not erect, install, or display any signs at the Premises or on the Property or Station without
Sublessor's prior written consent which Sublessor may refuse or condition in its discretion. All
of Tenant's signs must comply with all requirements of Law. Approval by Sublessor in or under
this Sublease of any proposed sign does not bind Sublessor, acting in its governmental capacity,
under any applicable Law of the City of Auburn with respect to that or any other sign. Iri
addition, all Tenant's signs must comply with the applicable requirements of Section 4.4(a) and
Exhibit 4.4(d) of the Master Sublease. Irr this regard, Exhibit 4.4{d) of the Master Sublease is
mistakenly referred to as Exhibit 4.4(a} in Section 4.4{a) of the Master Sublease. At the
expiration or earlier termination of the Tenn, Sublessor shall remove all signs from the Station
and shall restore the Premises, the awning of the Parking Garage adjacent. to the Premises, and
the Parking Garage to as nearly as practical the condition before installation of the sign.
23
26.2 Permanent Si ns. Tenant shall not erect, install, or display any
permanent signs at the Premises or on the Property or the Station without Sublessor's prior
written consent. All permanent signs placed on the exterior of the Parking Garage shall comply
with the provisions of the Exhibit 4.4(d) of the Master Sublease (mistakenly referred to as
Exhibit 4.4(a) in Section 4,4{a) of the Master Sublease) and shall also be first approved by
Sublessor as to size, design, materials, colors, and method of affixation to, as applicable, the
awning or the exterior wall of the Parking Garage. Sublessor hereby consents to painted or decal
signs on the exterior window of and exterior entrance door to the Premises provided such signs
comply with the requirements of Exhibit 4.4(d) of the Master Sublease.
26.3 Tem ~ ora Si s. Tenant may display temporary window sings on are in
front of the exterior window of the Premises of size, style, content and design that are usual and
ordinary for occupants.of premises in the City of Aubum, Washington for uses that are the same
or substantially the same as the~Permitted Use to identify and promote such use provided that no
such temporary sign shall be displayed for longer than two weeks and otherwise comply with the
requirements of Exhibit 4.4(d) of the Master Sublease.
27. SUBORDINATi(ON. This Sublease shall be subordinate to any sublease
hereafter made by Sublessor to one person or entity of all of the Commercial Tenant Area (a
"Master Subtenant") provided that the Master Subtenant shall not disturb Tenant's occupancy and
other rights under this Sublease so long as no uncured Event of Default under this Sublease
exists. Tenant shall attorn to any such Master Subtenant provided such the Master Subtenant
assumes Sublessor's obligations to Tenant under this Sublease. This subordination is automatic
and requires no further action or agreement of Tenant, Nevertheless, Tenant shall promptly and
in no event later than fifteen {15) days execute, acknowledge and deliver such documents and
agreements that Sublessor or the Master Subtenant may reasonably require as further evidence of
this subordination and attornment, which agreement may also contain additional provisions that
are consistent with the provisions of this paragraph and reasonably requested by Sublessor and/or
the Master Subtenant. .
28. ESTOPPEL CERTIFICATES. From time to time during the Term, any then
existing or prospective Master Subtenant or then existing or prospective purchaser or other
-ansfor~e-of--all-or-any-part-of--the-property- ~ r ues~t~ enan
execute and deliver specific written statements ("estoppel certificate"} concerning the status and
provisions of this Sublease, including any amendments or modifications thereof, Rent and other
payrinents made or payable thereunder, the Term, the existence of any defaults in the obligations
of Sublessor or Tenant, and such other matters as to which the requesting person-("Requester")
rt~ay reasonably .inquire. After each such request, whether made by the Requester or by
Sublessor, Tenant shall promptly and in no event later than seven (7} days comply therewith and
such writing shall be reasonably satisfactory in form and substance to the Requester. However,
nothing in the preceding sentence obligates Tenant to make any untruthful statement or a positive
or negative statement on a matter as to which Tenant has no knowledge; provided, however,
Tenant shall be required to represent such matters as to which or to the extent that Tenant does
have knowledge and state that it has no knowledge, if such be the case, of other matters. if
Tenant does not sign acid deliver an estoppel certificate within seven days after it is delivered to
Tenant with a request from the Requestor or from Sublessor then if the Requestor does become a
24
.~~-~~vv.w ~..~~ ytA~~uulr IJ~ GVVJ
transferee or Master Subtenant, Tenant shall be deemed to have, and shall be bound to the
Requester (a} as if Tenant had given such certificate as above provided without modification and,
in addition, (b) as if Tenant admitted to the Requester the accuracy of any information supplied
to it by Sublessor in any way concerning Tenant or this Sublease.
29. BREACH.
29.1 General Provisions. Time is of the essence hereo#; Tenant shall be in
"default" of its obligations under this Sublease if Tenant does nat pay or perform all obligation
imposed by it by this Sublease or by Law arising from and on account of this Sublease where and
as such obligation is due, Tenant shall_be in "breach" of its obligations under this Sublease:
29.1.1 if Tenant or any Guarantor of this Sublease makes a transfer in
fraud of creditors or makes any assignment for the benefit of creditors or admits in writing its
,inability to.payits debts when due; or
29.1.2 if Tenant attempts to assign any. of its rights under this Sublease
without Snblessor's prior written consent or without occurrence of all conditions to such consent,
or if Tenant vacates or abandons fhe Premises, with or without removal of pez-sonalEy or fixtures.
29.1.3 if Tenant fails to pay when due anypayment of money required of
it under this Sublease and such faiIuxe continues for a period of three days; or
29.1.4 if Tenant ~ fails to perform when due any of its other obligations
under this Sublease and such fai]ure is not coxed within twenty days after notice from Sublessor
to Tenant thereof; or
29.1.5 if Tenant creates, permits, ~or suffers any lien, encumbrance, or
security interest to attach to or be claimed through 't'enant against the Property or any part
thereof or any fixtures located therein or to all or any.part of Tenant's rights to the Premises or
under this Sublease and any such lien, encumbrance, or security interest is not released within
twenty days after Sublessor's notice to Tenant; or if any liquidation, reorganization, or
-~n~angemcrrt-proce~linbn5 ~'rl~d~fiYor~g t~nst enan~ ~n er any e or s a e p cy or
insolvency laws and any such proceeding is not vacated or dismissed within sixty days after
Subiessor's notice to Tenant; or if any receivership, conservatorship, or any other proceeding to
take away from Tenant control over all or any substantial part of its assets is filed by or agaunst
Tenant under any federal or state law and anysuch proceeding is not vacated or dismissed within
sixty days after Sublessor's notice to Tenant,• or if Tenant causes or. acquiesces in any plan of
arrangemen#, assignment, composition, or liquidation with or for the b~nefrt of creditors and any
such plan or condition is not rescinded, released, or removed within a period of twenty days after
notice from Sublessor to Tenant.
If.Tenant is in breach of its obligations under this Sublease, then or at any time thereafter
Sublessor may enter into and upon the Premises and repossess the same with or without
terminating this Sublease and without ptejudice to any of its other remedies for Runt or breach of
covenant. At Sublessor's election, Sublessor may tcnninate this Sublease at any time after
25
--~.. .....-. ...~~ vtillN{AlJ IVY LV VJ
Tenant's breach (even if Sublessor had previously elected not to do so) by giving notice of-its
election to do so or, without terminating this Sublease, Sublessor may let the Premises or any
part thereof on such .terms and conditions as Sublessor determines. in its absolute discretion.
Such terms and conditions may include concessions of rent and improvement of or alteration to
the Premises and may be for a rental term or terms greater or less than the balance of the Term
and inay be for all or any part of the Premises and may be of space which includes all or~any part
of the Premises and any other part of the Building. Whether Sublessor elects to temninate this
Sublease or elects not to do so, Sublessor has no duty to and is not required to relet or attempt to
reI~t the Premises or any part thereof either for Tenant's benefit or in mitigation of Sublessor's
damages for Tenant's breach. If Sublessor elects to relet. with or without terminating this
Sublease, "Sublessor`s costs .of reletting" include without limitation $ie costs of repairs,
restoration, renovation, alteration, and improvement which shall be prorated to the extent, if any,
the term of the reletting exceeds what would have been the balance of the Term, arzd the portion
of any leasing commission paid on account of the reletting attributable to the balance (or what
would have been the balance) of the Term and the part of the Premises relet. Tenant shall pay all
of Sublessor's costs and expenses arising in any way from or in any way related to Tenant being
in default of or in breach of any of its obligations under this Sublease, including without
limitation any related to giving of notices, to recovering possession and reentry, to reletting, and
to perforniing an obligation of which Tenant is in default or breach. In the preceding sentence,
"expenses" include, but are not limited to, the costs and fees of attorneys, consultants, experts,
and' witnesses.
29.2 Sublessor's Election To 3'erminate. If Sublessor elects to terminate this
Sublease and relet, as an obligation surviving such. termination Tenant shall pay on dennand to
Sublessor any unpaid Rent and other amounts which have become payable under the terms of
this Sublease for the period before termination, the amount of Rent and other sums payable under
the terms of this Sublease for the period after termination reasonably required to accomplish a
reletting, the amount by which, if any, the present value of the amount of Rent and other sums
payable under the terms of this Sublease for the balance of what the Term would have been after
the reletting exceeds the present value of the amount that Sublessor is,entitled to receive under
the reletting (prorated if the reletting includes any other portion of the Building), and any other
damages suffered by Sublessor on account of Tenant's breach. Such other damages include
--;:~~out-timitation Sublessors-eosts-of~eeovering-possession-and-r
ee~'Y;~e~rorata ~portio~of-~ ~--_---
any leasing commission paid by Sublessor on account of this Sublease applicable to what would
have been the balance of the Tenn after Tenant's breach, and Sublessor's costs of reletting.
Present value shall be determined assuming investrnent of funds at a ra#e of return equal to the
interest rate on long term United States federal government Treasury notes established at the
auction thereof held immediately before Snblessor's election to terminate.
29.3 Sublessor Does blot Elect To Termluate. If Sublessor does not elect to
terminate this Sublease, Tenant's Iiability to Sublessor shall include the total Rent and other sums
payable hereunder for the fiill Term, plus all of Sublessor's costs of repossession and reentry and,
if any, reletting, less the net proceeds of any reletting actually paid to and received by Sublessor
during the Term, prorated if the reletting includes any other portion of the Building.
26
___...~.. ~....,~ ..Hi nwuir ice, LVVJ
29.4 Sublessar's Ri ht To Perform. In addition to any other rights and
remedies which .Sublessor may have, if Tenant is in default or breach of any of its obligations
ender this Sublease, Sublessor may, at Sublessor's election, take such action as maybe required
to cure such default or breach and all costs and expenses incurred by Sublessor on account of ar
arising from such failure or incident to such action shall be reimbursed by Tenant on demand. In
the preceding sentence, "expenses" has the meaning specified in~paragraph 29.1. Sublessor shall
(in addition to any other right or remedy of Sublessor provided bylaw) have the same rights and
remedies in the event of the nonpayment of sums due under this Section as in the case of default
by Tenant in the payment of Rent.
29.5 Provisions Related To Bankruntcy. If a petition (in this paragraph 29.5,
"the petition") is filed by ar against Tenant under the federal Banlauptcy Code (in this paragraph
29.5, "the Code"j the following provisions apply:
29.5,1 Adequate protection for Tenant's obligations under this Sublease
accruing after the filing shall be provided within fi#}een days afrer the filing in the form of a
deposit equal to the then current Base Monthly Rent for one month and the then current monthly
payment on account of estimated Operating Costs.
29.5.2 A11 amounts payable by Tenant to Sublessor under this Sublease
represent reasonable compensation for Tenant's occupancy of the Premises.
5 29.5.3 Tenant or the trustee in bankruptcy (in this paragraph 29.5, "the-
trustee") for Tenant shall give. Sublessor at least thirty days prior written notice of any
abandonmen# of the Premises or of any proceeding relating to administrative claims concerning
the Premises or this Sublease. If Tenant or the trustee abandons without notice, Tenant or the
trustee shall stipulate to entry of an order for relief from stay to permit Sublessor to reenter and
relet the Premises.
29.5.4 If Tenant had failed to perform when due any of its obligations
under this Sublease and such failure had not been cured before the petition was filed, then for all
purposes under the Code Tenant shall be deemed to have been in breach of such obligations on
---`--~~~t~ dr~~p ~ io ~ ed regar ess o w e ier u~b essor arc gYVen notice o any one or more V'
of such defaults and regardless of whether any cure period applicable to any one or more of such
defaults had expired before such filing.
29.5.5 For the purposes of Section 365(b)(1) of the Code (as hereafter
arxiended or replaced), prompt cure of the defaults iri Tenant's obligations under this Sublease
shall mean cure within thirty days after assumption and shall include cure of any defaults under
any other agreements between Sublessor and Tenant.
29.5.6 ~ lior the purposes of Section 365(b)(1) of the Code (as
hereafter amended or replaced), adequate assurance of future performance of this Sublease by
Tenant, the trustee, or any proposed assignee of Tenant's rights under this Sublease, will require
that Tenant, the trustee, or the proposed assignee deposit two months of Base Monthly Rent and
the then monthly payment on account of Operating Costs into an escrow fund (to be held by the
27
court or an escrow agent approved by Sublessor and the court) as security for such future
performance. In addition, if Tenant's rights under this Sublease are to be assigned, adequate
assurance of future performance by the proposed assignee shat! require that: (a) the proposed
assignee have a tangible net worth of not less than $500,000 or that the proposed assignee's
performance be unconditionally guaranteed by a person or entity that has a tangible net worth not
less than such amount; and (b) the proposed assignee assume in writing all of Tenant's
obligations urider this Sublease.
29.5.7 If Tenant or the trustee intends to assume and/or to assign Tenant's
rights under this.Sublease, Tenant or the trustee shall provided Sublessor with thirty days prior
written notice of.the proposed action, separate from and in addition to any notice provided to all
creditors. Notice of a proposed assignment and/or assumption shall state the assurance of
prorrxpt cure, compensation for loss,. and assurance of future performance to .be provided to
Sublessor. Notice of a proposed assignment.shall also sta#e: (a) the name, address, and federal
tax identification numbers and registration numbers of the proposed assignee; (b) all of the terms
and conditions of the proposed assignment; and (c) the assignee's proposed adequate assurance
of future performance to be provided to Sublessor,
29.6 Interest, All Rent and other sums payable to Sublessor by Tenant under
this-Sublease not paid when due shall bear and Tenant shall pay interest from the date they are
due until they are fully paid at the rate of 18% per year or, if applicable, such lower rate, if any,
as is the highest rate permitted by Law, taking into account all the provisions of such Law,
including but not limited to that differentiate based on the nature of the, parties and those that
differentiate between transactions for personal, family or household use and other transactions.
29.7 Rights and Remedies Cumulative. Sublessor's rights and remedies
provided in this paragraph 29 and elsewhere in this Sublease are cumulative with and in addition
to each and also to such other and further rights granted to Sublessor by Law. The exercise of
one right or remedy shall not be deemed to be or otherwise operate as an election that excludes
Sublessor's exercise at any time of a differentror inconsistent right or remedy. Sublessor's failure
at any time to exercise any right or remedy it has under the terms of this Sublease or bylaw shall
not be deemed to be or otherwise operate as waiver by it of its right to-exercise such right or
eti-der-ar~~ other~ightrorrernedy at-any-other-ar-future-time; ~v ~ ~ -
or a different event or circumstance.
30. HOLDOVER. If with Svblessor's consent Tenant holds over after expiration or
termination of this Sublease, such tenancy shall be a month-to-month tenancy which may be
ternninated in accordance with applicable Law and Tenant shall pay to Sublessor the same Rent
and other surns payable to Sublessor as last applicable under this Sublease and shall otherwise be
bound by all applicable provisions of this Sublease consistent with amonth-to-month tenancy
including without limitation those which survive expiration or termination.
31. POSSESS);ON. If for any reason whatsoever Sublessor is not able to tender
possession of the Premises at the time for commencement of the Term, neither- Sublessor nor its
agent shall be liable for any damage caused thereby, nor shall this Sublease thereby become void
or voidable, nor shall the Tenn be in any way extended. However, as Tenant's sole and
28
•,••~ «;~.~c~ y, jai coal y I v, GUU3
exclusive rights and remedies on account thereof, Tenant shall not be liable for any Rent until
such tune as Sublessor terxders possession and Tenant may terminate this Sublease by not less
than thirty days' prior notice to Sublessor unless Sublessor tenders possession before the end of
such time.
32. NOT)tCES.. Any notice provided for in or otherwise related to this Sublease to be
given by one party to' the other shall be in writing and shall be sufficient if given either by
personal delivery to or by first class, postage prepaid, United States mail to Sublessor's Notice
Address or Tenant's Notice Address, as~ the case may be,. or to such other sirigle substitute
address (which shall thereafter be the party's Notice Address) as may be designated ~by notice to
the other ,party or, in the case of Tenant, to the Premises, "Notice" includes without limitation a
demand or a request, Notices that are mailed shall be deemed given on the date mailed. At the
option of the sender, mailed notices may be mailed registered or certified mail with return receipt
requested. Notice given by Sublessor to any one or more of those jointly and severally liable on
Tenant's obligations.under this Sublease shall. be effective as notice given to all such persons.
Notices that are sent and received by courier or messenger service shall be considered to have
been personally delivered when received. Notices that are sent and received in complete form by
electronic facsimile devices shall b.e considered to have been personally delivered when sent if
the sending party receives a written send verification on its facsimile device. Tlie preceding
sentence does not obligate any party to' accept a facsimile .transmission. "Facsimile
transmission" is a method of encoding a written document- into data at a transmitting station,
transmitting the encoded data electronically, and decoding the transmission to reproduce a paper
copy of the document at the receiving station, including but not limited to any graphic material
on the original document, such 'as signatures, drawings, notes, photographs, and the like. The
method of electronic camumnication commonly known as "e-mail" is not a facsimile
transmission (even if accompanied by an attachment) and is not an acceptable means. of giving
notice. .
33. TENANT IMPR0~4yEMENTS AND ACCEPTANCE. Unless expressly
provided otherwise in the Tenant Improvement. Rider attached to this Sublease, if any,
Sublessor has no obligation to make or pay for any improvements to or other alterations of or to
do any other work to the Premises for Tenant's benefit at or before commencement of the Term
"'~_~f `T''ezranrt 1~in~srov-etnents~"j: If~ublessor as no suc ob r1 ga~"ioii-;~e"n enan ac o~v ges it as
inspected the .Premises and accepts them in their current condition, as is. If a Tenant
Improvement Rider is attached hereto that includes an obligation of Sublessor to make or pay for
any Tenant Improvements, then Tenant acIrnowledges it has inspected the Premises and accepts
them in their current condition subject to modification substantially in accordance with
Sublessor's obligation to make or pay~for one or more Tenant Improvements as provided in such
Rider. NO REPRESENTATION OR WARRANTY IS MADE BY SUBLESSOR OR BY
ANY OF YTS OFFICERS, EMPLOYEES OR AGENTS REGARDING THE CONDITION
OF THE PREMISES, T)BE PROPERTY, THE PARIffNG GARAGE, OR THE STATION
OR ANY PART OF ANY OF THE FOREGOING OR THE SI7ITABILITY OF ANY OF
THE FOREGOING FOR TENANT OR FOR THE PERMITTED USE.
34, BROKERS. Tenant represents to Sublessor that Tenant has not made any
agreement for payment of any commission, tnder's fee, or other compensation to any real estate
29
broker, sales agent, leasing agent, or other third party in connection with this Sublease and agrees
to defend, indemnify, and save harmless Sublessor from and against any such claim based on an
allegation of any such agreement by Tenant. Tenant further represents to Sublessor that Tenant
has not dealt with any real estate broker, sales agent, leasing agent, or other third party in
connection with this Sublease except Northwest Corporate Real Estate. Inc. .
35. TENANT'S i2EPRESENTATIONS. Tenant represents and warrants to
Sublessor that: (a} Tenant is a Corporation duly organized; existing, and good standing under the
law of the state of Washington; (b) Tenant is engaged in the business of)~inanncial.Services; and
(e) Tenant has obtained all licenses and other governmental permits; and has otherwise complied
with all Laws, so that it is authorized to conduct such business at the )?remises. Tenant shall at
all times during the Term obtain'and maintain all such licenses and other permits and otherwise
comply with all such Laws.
36. TRANSFER O)F LANDi,ORD'S INTEREST. This Sublease shall be
assignable by Sublessor without the consent of Tenant, including but not limited to assignment to
a 1Vlaster Subtenant as permitted under paragraph 27. In the event of any~transfer or transfers of
Sublessor's interest in the Premises or in the event of any transfer or transfers of Sublessor's
'interest in this Sublease; other than a transfer for security purposes only, upon the assumption of
Sriblessor's obligations under this Sublease by the transferee, Tenant shall attorn to the transferee
and Sublessor shall be automatically relieved of obligations and liabilities accruing from and
after the date of such transfer, except for any security deposit or prepaid rent retained by
Sublessor and not delivered by it to the transferee.
37. MISCELLANEOUS.
37.>! Tenant Financial Statements. Promptly a$er Sublessor's request
therefor front time to time, Tenant shall provide to Sublessor copies of Tenant's most recent
financial statements and tax returns.
37.2 Light, View and Air. Tenant has not been granted an easement or other.
right for, and Sublessor has not otherwise guaranteed and is.not obligated to maintain, the
----- ----present-statjrs-af; light; -air-aryiew--to-ar-fr a rertuses om an roe
including but not limited to the Plaza or any other part of the Station. p Any duninutron or
shuttrng off of light, air or view by any structure which may be erected anywhere {including but
not limi#ed to the Station, adjacent to the Station, or in the vacinity of the Station} shall in no way
affect this Sublease or Tenant obligations under this Sublease or impose any liability on
Sublessor. Sublessor does not guarantee and shall not be required to maintain the. present status
of light, air, or view of the Premises over any part of the Property nor the present status of light,
air, or view of any part of the Property over any. property adjoining or in the vicinity of the
Property. .
37.3 Waiver. Sublessor's failure to insist on strict performance of any
provision of this Sublease or of Sublessor's Rules and Regulations shall not be construed or
operate as a waiver of Sublessor's right,to insist on strict performance of any other provision at
all times or of strict perfornance of such provision in the fixture. Sublessor shall not be deemed
30