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RESOLUTION NO. 2 9 5 6
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A RESOLUTION OF THE CITY COUNCIL OF THE CITY' OF AUBURN,
WASHINGTON, AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE
CONSENT OF CITY TO SUBLEASE PREMISES AT AUBURN MUNICIPAL
AIRPORT BETWEEN THE CITY AND AUBURN FLIGHT SERVICES, INC.
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WHEREAS, pursuant to Section 18 of the Lease Agreement
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entered into between the CITY OF AUBURN and SKY SERVICES, INC.
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as amended, the CITY must consent to any assignment or
sublease of any part of the premises located at the Auburn
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Municipal Airport; and
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WHEREAS, SKY SERVICES, INC. has requested permission to
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enter into a sublease with AUBURN FLIGHT SERVICES, INC.
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NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF AUBURN,
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WASHINGTON, IN A REGULAR MEETING DULY ASSEMBLED, HEREWITH
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RESOLVES AS FOLLOWS:
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Section 1.
The Mayor and City Clerk of the City of
17 Auburn are herewith authorized to execute Consent of City to
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Sublease.
A copy of said Consent is attached hereto,
19 denominated as Exhibit "Au and made a part hereof as though
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20 set forth in full herein.
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Section 2.
The Mayor is hereby authorized to implement
such administrative procedures as may be necessary to carry
out the directives of this legislation.
Resolution No. 2956
April 30, 1998
Page 1
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DATED this 4th day of May, 1998.
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CITY OF AUBURN
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~/~ ~J-t
CHARLES A.. BOOTH
MAYOR
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9 ATTEST:
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~c~
Danielle E. Daskam,
City Clerk
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APPROVED AS TO FORM:
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"'chael J~e.
City Attorney
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Resolution No. 2956
April 30, 1998
Page 2
CONSENT OF CITY TO SUBLEASE
PURSUANT to Section 18 of the Lease Agreement entered
into between the CITY OF AUBURN and SKY SERVICES, INC. as
amended, the CITY must consent to any assignment or sublease
of any part of the premises.
SKY SERVICES, INC... whose
address is 1725 "En Street Northeast, Auburn, WA 98002, has
requested permission to enter into a sublease with AUBURN
FLIGHT SERVICES, INC., whose address is 506 23rd Street
Northeast, Auburn, WA 98002.
THE CITY hereby consents to the sublease, with the
following conditions:
1. The sublessee shall incorporate into the sublease
the following provisions of the Lease Agreement
between the CITY and SKY SERVICES, INC., including
all amendments to the Lease Agreement:
public
liability insurance requirements, indemnification,
use of public airport facilities, maintenance and
repairs, cleanliness and waste, personal property
taxes,
and property insurance and waiver of
subrogation.
Sublessee shall be required to
comply with all of the above-mentioned provisions,
including but not limited to,
the insurance
requirements of the Lease Agreement as amended in
Consent to Sublease Auburn Flight
Resolution No. 2956 Exhibit "A"
April 30, 1998 {c\agree\ccs-af}
Page 1
naming the CITY as additional insured.
Sublessee
shall provide a Certificate of Insurance to the
CITY prior to commencing occupancy under the
sublease.
2. Sublessee shall agree to defend, indemnify and
hold the CITY harmless under the indemnification
provisions of the Lease Agreement as amended.
3. The term of the sublease shall not exceed the term
of the Lease Agreement, as amended.
4. A copy of the signed sublease shall be filed with
the CITY prior to occupancy.
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DATED this ~ day of May, 1998.
CITY OF AUBURN
~~I", Q. Wc~
CHARLES A. BOOT
MAYOR
ATTEST:
~~!~~
City Clerk
Consent to Sublease Auburn Flight
Resolution No. 2956 Exhibit "A"
April 30, 1998 Ic\agree\ccs-af}
Page 2
APPROVED AS TO FORM:
~~~~-{~'de.
City Attorney
AUBURN FLIGHT SERVICES, INC.
By: ~ ;15Jz;dU'L~r
Title: ;::;~~~
STATE OF WASHINGTON )
) ss
COUNTY OF KING )
On this ,~~ day of
me, the undersigned, a Notary
Washington, duly commissioned
,--J~/~e Jd' ~c$/Cr~
_ ~e:"'y de/1.c
~U/le.-..
, 1998, before
Public in and for the State of
and sworn, personally appeared
to me known to the
, of AUBURN FLIGHT SERVICES,
INC., who executed the within and foregoing instrument, and
acknowledged
voluntary act
the said instrument to be the free and
and deed of said AUBURN FLIGHT SERVICES, INC.,
for the uses and purposes therein mentioned, and on oath
stated that he is authorized to execute said instrument on
behalf of said AUBURN FLIGHT SERVICES, INC.
IN ].~t~~\S WHEREOF, I have hereunto set my ha.nd and
affix~~i.;.~~F.l seal on date herei above set forth.
~ ~ /~",SION f!.... '9t/l'1 ; /J
,~.,~~ '-1:<,'. 0', -=7
~ .:0 NOTARy ~". z~ ;t!e...J
~ 1u -- gr ~ NOTARY PUBLIC in and for the State
~,~. PuaUC .: j of Washington, residing at ~',//1SP'
\~;;':'<::29-?>~f MY COMMISSION EXPIRES: /.,.Z, -<.19'- ()/
1,;~Q.."-'" #~
'\\ W~ __-
,,,,"".........,-
Consent to Sublease Auburn Flight
Resolution No. 2956 Exhibit "A"
April 30, 199B {c\agree\ccs-afl
Page 3
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Section
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IS
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Exhibits
A.
B
B.I
SKY SERVICES, INC. LEASE
with
AUBURN FLIGHT SERVICES, INC.
TABLE OF CONTENTS
T~ ~~
Basic Lease Terms..... ........... ......... ............. ............. .., ......... ...... ....................................................................1
Pemises . ....... ................ ...... ................. .... .......................... ................... .............................. ......... ............ ......2
Term ............................................................................................................................___..............................2
Rent..............................................................................................................................................................2
Prepaid Rent...... ......... ............. .............. .................. ............ ....... ........................... ................. .......... .......... ...2
Deposit..........................................................................................................................................................3
Use of Premises and Project Facilities.... ...... ........ .............. ..................... ....................... .............. ..................3
Signage ..... ... .................. ............... .... ....... .... ................ ....... ....... .............. ...................................... .... ...........3
Personal Property Taxes ..... ......... .......... .................. .... ........ ......... ............ ................................... ..................3
Parking........................................................................................:.................................................................3
Utilities.........................................................................................................................................................3
Maintenance..................................................................................................................................................4
Alterations.....................................................................................................................................................4
Release and Indemnity..... ...... .......................... ...... .... ......... ......... .... .......... ...................................... ..............4
=:~~:::::::::::::::::::::::::::::::::::::::::::::::::::CG1....:::...~.::......::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::~
Condemnation............................................. ........ r:::\. ,{R...................................................................5
Assignment or Sublease................................. ... . ~ [~.~.....................................................6
~::~::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::..::::~.::::::::::lf:::::::::::::::::::::::::::::::::::::::::::::::::::::::::~
EnlIy on Premises...... ............. .......... ........... ................... ... ...... ....... .... ....................................... ..... ...............8
Subordination................................................................................................................................................8
Notice............................................................................................................................................................ 9
Waiver. ......... ..... ...... ............... ............................. ................ ...... ................ ...... .............. .......... ..... ........... ..... 9
Surrender of Premises; Holding Over....... .......... ...... ........... ... ........ .... ...... .................................... ..... ...... ....... 9
Mortgagee Protection. ............. .......... ........ ............... ................................. ................................. ... ................ 10
Limitation of Liability .. ................. ...... ............ ............ ...... ............. .... ........................... ...... ......................... 10
Miscellaneous Provisions. ..................................................... ...... ......................... .................. ........ .... ...........10/
~~.~.~.~.~~.~~~.~~~~::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::;;4
Execution of Agreement by Corporation and Guaranty .................................................................................11
City Rules and Regulations... ............. .............................. ........... .......... ........ ......... ........... ........... ....... ........... 12
No Smoking .................................................................................................................................................12
Early Termination and First Right ofRefusa1to Purchase or Lease Entire Project.......................................... 12
Renewal Option............................................................................................................................................12
Early Termination by Tenant on Failure to Reach Agreement on Purchase Terms ........................................12
The Premises ...................... ...................... .................. ................. ........................ .... .... ..... ....... ....... ...... ....... .14
The Project .... ....... .................................................................................... ................... .... ........ ....... .............. 14
Legal Description ............ ...................................... ....... ...... ................ ................ .............. .......... ........... ....... IS
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SKY SERVICES, lNC. LEASE
with
AUBURN FLIGHT SERVICES, INC.
1.
::::'.:.::cunoN....m~Q~p........m.................ApriII. I'"
TENANT:.......................................................................................................Auburn Flllght SelVlces. Inc.
Trade Name: ...................................................................................................Aubum Flight Services. Inc.
Address (Leased Premises): .........................................................1725 "E" Street NE, Auburn W A 98002
Address (For Notices): ...... ....... .... ..... ............................... .................... ..... ....... ....... ........ ............... ..... Same
a.
b.
c.
LANDLORD: ................................................................................................................ Sky Services, Inc.
Address (For Notices):...........................................................................................1134 Eiattle Ridge Drive
................. ...... ............. .............. ..... .......... .......... .................. ......... ....... ........ ..... Independence K'f 41051
d.
TENANT'S USE OF PREMISES: ...................................................................................Aircraft Related
e.
PREMISES AREA: .................................Portion of Building: 6424 (approximate) Renlable Square Feel,
.....................................................................................plus outdoor area of approximately three (3) acres.
f.
PROJECT AREA: ........................................................ Total Building = 7950 (approximate) Square Feet
g.
PREMISES PERCEN.T OF PROJECT:.................................................................. Building Only: 81%
h. TERM OF LEASE: Commencement:................. April I. 1998 Expiration:............March 31. 2003
Number of Months: 60
i. BASE MONTHLY RENT: .............................$2.430.00. plus variable ground rent (currently $1.975.46)
....:................................................................................................................ payable to the City of Auburn
j.RENT ADJUSTMENT...................................................................................... None, e"cept ground rent
k. PREPAID RENT: ......................................................................(First Month)$2.430.oo, plus ground rent
1. TOTAL SECURITY DEPOSIT:.................. $2,430.00. including a $250.00/non-refundable cleaning fee
m. BROKER(S): .................................................................................................................................... None
n. . BROKERAGE COMMISSION PAYABLE BY ............................................................................ None
o. GUARANTORS: ............................................................................................................ Tenant's Officers
p. ADDmONAL EXHIBITS
Additional Exhibits lettered A and B are attached hereto and made a part hereof. If none. so state in the
following space
COMMERCIAL LEASE AGREEMENT - 1
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LANDLORD'S INITIALS:~~ /
TENANT'S INITIALS: /
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Section 1 represents a summary !If the basic terms of this Lease. In the. event of any
inconsistency between the terms contained in Section 1 and any specific clause of this
Lease, the terms of the more specific clause shall prevail.
2. PREMISES. Landlord hereby leases to Tenant and Tenant leases from Landlord, tho"" certain Premises
described in Section 1 and in Exhibit A attached hereto (the "Premises"), located in this Project described
on Exhibit B (the "Project"). BY EN1RY ON TIlE PREMISES, TENANf ACKNOWLEDGES mAT
IT HAS EXAMINED TIffi PREMISES AND ACCEPTS THE PREMISES IN THEIR PRESENT
CONDmON. Notwithstanding any provision to the contrary, this Lease is a sublease ,md is subordinate
to and subject to the tenns and conditions of the master ground lease entitled "Fix'O(\-Base Lease At
Auburn Airport" dated February 27, 1978, between the city of Auburn as Landlord, :md Sky Services,
Inc., as Tenant, together with any Addenda thereto ("Master Ground Lease"). Tenant herein
acknowledges that it has had the opponunity to review said Master Ground Lease and agrees to comply
with all tenns and conditions therein. Landlord reserves the right for itself, its assigns or sublessees to use
in common with Tenant the paved taxiways and, as designated by Tenant, three vehicle parking spaces
and one airplane tie-down area.
3. TERM. The term of this Lease shall be for the period set forth in Section I, commencing on the date set
forth in Section L
4. RENT.
a
b.
c.
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Rent. Tenant shall pay Landlord a monthly base rent in the initial amount set forth in Section I,
which shall be payable monthly in advance on the first day of each and eve~y calendar month
("Base Monthly Renn; in addition, Tenant shall pay Landlord monthly the ground rent payable
to the City of Auburn pursuant to the Master Ground Lease.
Rent Adjustment. None in Base Monthly Rent.
Rent Without Offset and Late Charge. All rent shall be paid by Tenant to Landlord monthly
in advance on the first day of every calendar month at the address shown in Section I or such
other place as Landlord may designate in writing from time to time. All r,ent shall be paid
without prior demand or notice and without any deduction or offset whatsoever. All rent shall be
paid in lawful currency of the United States of America. All rent due for any partial month shall
be prorated at the rate of 1130 of the total monthly rent per day. Tenant acknowledges that late
payment by Tenant to Landlord of any rent or other sums due under this Lease will cause
Landlord to incur costs not contemplated by this Lease, the exact amount of such costs being
extremely difficult and impracticable to ascertain. Such costs include, without limitation,
processing and accounting charges and late charges that may be imposed on Landlord by the
tenns of any encumbrance or note secured by the Premises. Therefore, if any lrent or other sum
due from Tenant is not received when due, Tenant shall pay to Landlord an additional sum equal
to 10% of such overdue payment. Landlord and Tenant hereby agree that such late charge
represents a fair and reasonable estimate of the costs that Landlord will incur by reason of any
such late payment. Additionally, aU such delinquent rent or other sums, plus this late charge,
shall bear interest at the then maximum lawful rate pennitted to be charged by Landlord. Any
payments of any kind returned for insufficient funds will be subject to an ad,:!itional handling
charge of $25.00.
5. PREPAID RENT. Upon the execution of the Lease, Tenant shall pay to Landlord the: prepaid rent set
forth in Section I, and if Tenant is not in default of any provisions of this Lease, such prepaid rent shall
be applied toward the rent due for the last month of the term. Landlord's obligations with respect to the
prepaid rent are those of a debtor and not of a trustee, and Landlord can commingle the IPrepaid rent with
COMMERCIAL LEASE AGREEMENT - 2
. (La?
LANDLORD'S INITlALS~l ;;rf
TENANT'S INITIALS: .;::.-.;
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Landlord's general funds. In the event the City of Auburn does not consent to this Lease, Landlord shall
return within 30 days said prepaid rent and any deposit.
6. DEPOSIT. Upon execution of this Lease, Tenant shall deposit with Landlord the amount of the security
deposit set forth in Section 1 in part as security for the performance by Tenant of the provisions of this
Lease and in part as a cleaning fee. If Tenant is in default, Landlord can use the secwrity deposit or any
portion of it to cure the default or to compensate Landlord for all damage sustained by Landlord resulting
from Tenant's default Upon demand, Tenant shall immediately pay to Landlord a sum equal to the
portion of the security deposit expended or applied by Landlord to maintain the secwrity deposit in the
amount initially deposited with Landlord. If Tenant is not in default at the expiration or termination of
this Lease, Landlord shall return the entire security deposit to Tenant, except for S250.00 (Two-Hundred
Fifty); which Landlord shall retain as a non-refundable cleaning fee. Landlord's obligllltions with respect
to the deposit are those of a debtor and not of a trustee, and Landlord can commingle tile securitY deposit
with Landlord's general funds. Landlord shall not be required to pay Tenant interest on the deposit.
7. USE OF PREMISES AND PROJECT FACILITIES. Tenant shall use the Premises solely for the
pwposes set forth in Section 1 and in the Master Ground Lease and for no other purpose without
obtaining the prior written consent of Landlord. Tenant acknowledges that neither :Landlord nor any
agent of Landlord has made any representation or warranty with respect to the Premises or with respect to
the suitability of the Premises or the Project for the conduct of Tenant's business, nor lias Landlord agreed
to undertake any modification, alteration or improvement to the Premises or the Project, except as
provided in writing in this Lease. Tenant acknowledges that Landlord may from time to time, upon ten
(IO) day's notice, in its sole discretion, make such modifications, alterations, deletions or improvements to
~ the Project as Landlord may deem necessary or desirable, without compensation to Ten:mt. Tenant shall
promptly comply with all laws, ordinances, orders and regulations affecting the Premises and the Project,
cO2 including without limitation any roles and regulations that may be attached to this Lease and to any
~ ~ reasonable modifications to these roles and regulations as Landlord may adopt from time to time. Tenant
,::::;. (\ ) will not perform any act or cany on practice that may injure the Premises or the Projc:ct; that may be a
~j? ~.uisance or menace to the other Tenants in the Project; or that shall in any way interf,:. re with the quiet
enjoyment of such other Tenants. Tenant shall not use the Premises for sleeping, washing clothes,
king or the preparation, manufacture or mixing of anything that might emit any objectionable odor,
noises, vibrations or lights onto such other Tenants. If sound insulation is required to muffle noise
produced by Tenant on the Premises, Tenant, at its own cost, shall provide all neo:ssary insulation.
Tenant shall not do anything on the Premises which will overload any existing parking or service to the
Premises. Pets and/or animals of any type shall not be kept on the Premises.
8. SIGNAGE. Tenant shall obtain Landlord's written consent. which shall not be unreasonably withheld,
before installing any signs upon the Premises. Tenant shall install any approved signage at Tenant's sole
expense and in compliance with all applicable laws. Tenant shall not damage or defaoe the Premises in
installing or removing signage and shall repair any injury or damage to the Premises caused by such
installation or removal.
9. PERSONAL PROPERTY TAXES. Tenant shall pay before delinquency all taxes, assessments, license
fees and public charges levied, assessed or imposed upon its business operations as well as upon all trade
fixtures, leasehold improvements, merchandise and other personal property in or about the Premises.
10. PARKING. Landlord hereby grants to Tenant and Tenant's customers, suppliers" employees and
invitees, an exclusive license to use the designatC:d parking areas in the Project for Ithe use of motor
vehiCles during the tem of the Lease. Landlord for itself, its agents or sublessees, reserves the right to use
in common with Tenant up to three (3) parking stalls to be designated by Tenant.
II. UTILITIES. Tenant shall pay for all water, gas, heat, light. p,:lwer, sewer, electricity, telephone. solid
waste, storm drainage. or other service or utility metered, chargeable or provided to the Project.
COMMERCIAL LEASE AGREEMENT - 3
n~1 .
LANDLORD'SINlTlALS:~~
TENANT'S INITIALS: (~
12. MAINTENANCE. Landlord shall maintain, in good condition, the structural parts of the Premises,
which shaH include only the foundations, bearing and exterior walls (excluding glass)" subflooring and
roof (excluding skylights), the unexposed electrical, plumbing and sewage systems, including without
limitation, those portions of the systems lying outside the Premises, exterior doors (excluding glass)
window frames. gutters and downspouts on the Building. Except as provided above, T"nant shall, at its
sole expense, maintain the Premises in good condition and promptly make all repairs necessary to keep
the Premises safe and in good condition, including without limitation, maintaining lmd repairing all
walls, floors, ceilings, interior doors, exterior and interior windows and fixtures as well as damage caused
by Tenant, its agents, employees or invitees, and all utilities and other systems servicing the Premises;
provided, however, the expense of replacing any heating, ventilating and air conditioning systems shall be
that of Landlord. Tenant shall maintain and keep clean all exterior and common areas :including vehicle
and airplane parking areas, taxiways and ti~owns, and shall mow all grass areas and maintain
landscaping as needed. Tenant shall also maintain, repair, and/or replace at its sole expense, the
following: aircompressor and system; fire extinguishers, oillwater separator system, and waste oil barrels
and containment system. Upon expiration or termination of this Lease, Tenant shall surrender the
Premises to Landlord in the same condition as existed at the commencement of the term, except for
reasonable wear and tear or damage caused by fire or other casualty for which Landlord has received all
funds necessary for restoration of the Premises from insurance proceeds.
13.
ALTERATIONS. Tenant shall not make any alterations to the Premises, or to the Project, including any
changes to the existing landscaping, without Landlord's prior written consent, which consent shall not be
unreasonably withheld. If Landlord gives its conseut to such alterations, Landlord may post notices in
accordance with the laWs of the state in which the Premises are located. Any altemtions made shall
remain on and be surrendered with the Premises upon expiration or termination of this L~e, except that
Landlord may, within 30 dllys before or 30 days after expiration of the term, elect to require Tenant to
remove any alterations which Tenant may have made to the Premises, and at its own r:ost Tenant shall
restore the Premises to the condition designated by Landlord in its election, before the last day of the tenn
or within 30 days after notice of itS election is given. whichever is later.
(]
'(Q2
...~ Should Landlord consent in writing to Tenant's alteration of the Premises, Tenant shall contract with a
~ntractor approved by Landlord for the construction of such alterations, shall secun: all appropriate
governmental approvals and permits, and shall complete such alterations with due diligence in
mpliance with plans and specifications approved by Landlord. All such construction shall be perfonned
in a manner which will not interfere with the quiet enjoyment of other Tenants of the Project. Tenant
shall pay all costs for such construction and shall keep the Premises and the Project ftc<, and clear of all
mechanics' liens which may result from construction by Tenant
14. RELEASE AND INDEMNITY. As material consideration to Landlord, Tenant agreo~ that Landlord
shall not be liable to Tenant for any damage to Tenant or Tenant's property from any ~Luse, and Tenant
waives all claims against Landlord for damage to persons or property arising for any n:ason, except for
damage resulting directly from Landlord's breach of its express obligations under tltis Lease which
Landlord has not cured within a reasonable time after receipt of written notice of such breach from
Tenant Tenant shall indemnify and hold Landlord harmless against all1iabilities, damages, costs, and
expenses, including attorney's fees, arising out of any damage or loss to any person or property occurring
in, on or about the Premises or Tenant's use of the Premises or Tenant's breach of any tenn of this Lease.
15. INSURANCE. Tenant at its cost. shall maintain public liability and property damage insurance and
products liability insurance with a single combined liability limit of not less than $1,000,000, and property
damage limits of not less than $500,000, insuring against all liability of Tenant an,1 its authorized
representatives arising out of or in connection with Tenant's use or occupancy of the Premises. Public
liability insurance, products. insurance and property damage insurance shall insure perforrnance by Tenant
of the indemnity provisions of Section 14. Landlord shall be named as additional insured. On all its
. personal property, at its cost, Tenant shall maintain a policy of standard fire and eXltended coverage
COMMERCIAL LEASE AGREEMENT - 4
LANDLORD'S 00TIAlS,.M r#f
TENANT'S INITIALS:
insurance with vandalism and malicious mischief endorsements and "all risk" coverage on all Tenant's
improvements and alterations in or about the Premises, to the extent of at least 90% of their full
replacement value. The proceeds from any such policy shall be used by Tenant for the replacement of
personal property and the restoration of Tenant's improvements or alterations. All insurance required to
be provided by Tenant under this Lease shall release Landlord from any claims for damage to any person
or to the Premises and the Project, and to Tenant's fixtures. personal property, improvements and
alterations in or on the Premises or the Project, caused by or resulting from risks insured against under
any insurance policy carried by Tenant and in force at the time of such damage. All insurance required to
be provided by Tenant under this Lease: (a) shall be issued by insurance companies authorized to do
business in the state in which the Premises are located with a financial rating of at least an A + XII status
as rated in the most recent edition of Best's Insurance Reports; (b) shall be issued as a primary policy; and.
(c) shall contain an endorsement requiring at least 30 days prior written notice of cancellation to Landlord
and Landlord's lender, before cancellation or change in coverage, scope or amount of any policy. Tenant
shall deliver a certificate of copy of such policy together with evidence of payment of all current premiums
to Landlord within 30 days of execution of this Lease. Tenant's failure to provide evidence of such
coverage to Landlord may, in Landlord's sole discretion, constitute a default under this Lease.
16. DESTRUCTION. If during the tenn, the Premises or Project are more than 10% destroyed from any
cause, or rendered inaccessible or unusable from any cause. Landlord may, it its sole discretion terminate
lease by delivery of notice to Tenant within 30 days of such event without compensation to Tenant. If in
Landlord's estimation, the Premises cannot be restored within 90 days foIlewing such destruction, then
Landlord shall immediately notify Tenant and Tenant may terminate this lease by de:livery of notice to
Landlord within 30 days of receipt of Landlord's notice. If Landlord does not terminate this lease and if
in Landlord's estimation the Premises can be restored within 90 days, then Landlord shall commence to
restore the Premises in compliance with then existing laws and shall complete such re:storation with due
diligence. In such event this lease shall remain in full force and effect, but there shall be an abatement of
rent between the date of destroction and the date of completion of restoration, based on the extent to which
destruction interferes with Tenant's use of the Premises.
17. CONDEMNATION.
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cD~
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b.
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Definitions. The following definitions shall apply. (1) "Condemnation" means (a) the exercise
of any governmental power of eminent domain, whether by legal proceedin!:s or otherwise by
condemnor and (b) the voluntary sale or transfer by Landlord to any condemnor either under
threat of condemnation or while legal proceedings for condemnation are proce<.mng; (2) "Date of
taking" means the date the condemnor bas the right to possession of the property being
condemned; (3) "Award" means all compensation, sums or anything of value: awarded. paid or
received on a total or partial condemnation; and (4) "Condemnor" means any public or quasi-
public authority, or private corporation or individual, having a power of condemnation.
Obligations to be Governed by Lease. If during the term of this Lease there is any taking of all
or any part of the Premises or the Project. the rights and obligations of th.e parties shall be
determined pursuant to this Lease.
Total or Partial Taking. If the Premises are totally taken by condemnation, this lease shall
terminate on the date of taking. If any portion of the Premises is taken by condemnation, this
Lease shall remain in effect, except that Tenant can elect to terminate this lease if the remaining
portion of the Premises is rendered unsuitable for Tenant's continued use of the Premises. If
Tenant elects to tenninate this lease, Tenant must exercise its right to terminate by giving notice
to Landlord within 30 days after the nature and extent of the taking have been finally determined.
If Tenant elects to terminate this Lease, Tenant shall also notify Landlord of the date of
termination, which date shall not be earlier than 30 days nor later than 90 days after Tenant has
notified Landlord of its election to terminate; except that this Lease shall terminate on the date of
COMMERCIAL LEASE AGREEMENT - 5
LANDLORD'S INITIALS:
TENANT'S INITIALS:
-J),g lP/
.,
laking if the date of taking falls on a date before the date of termination as designated by Tenant.
If any portion of the Premises is taken by condemnation and this Lease remains in full force and
effect. on the date of taking the rent shall be reduced by an amount in the same ratio the tolal
number of square feet in the Premises taken bears to the total number of square feet in the
Premises immediately before the date of taking.
18. ASSIGNMENT OR SUBLEASE. Tenant shall not assign or encumber its interest in this Lease or the
Premises or sublease all or any part of the Premises or allow any other person or entity (except Tenanfs
authorized representatives, employees, invitees, or guests) to occupy or use all or any part of the Premises
without first obtaining Landlord's consent, which shall not be unreasonably withheld. Any assignment,
encumbrance or sublease without Landlord's written consent shall be voidable and at Landlord's election,
shall constitute a default. If Tenant is a partnership, a withdrawal or change, voluntary. involuntary or by
operation of law of any partner, or the dissolution of the partnership, shall be deemed a voluntary
assignment. If Tenant consists of more than one person, a purported assignment. voluntary or involuntary
or by operation of law from one person to the other shall be deemed a voluntary assignment. If Tenant is
a corporation, any dissolution, merger, consolidation or other reorganization of Tenant" or sale or other
transfer of a controlling percentage of the capital stock of Tenant, or the sale of at least 25% of the value
of the assets of Tenant shall be deemed a voluntary assignment. The phrase "controlling percentage"
means ownership of and right to vote stock possessing at least 25% of the total combined voting power of
all classes ofTenanfs capital stock issued, outstanding and entitled to vote for election of directors. This
Section 18 shall not apply to corporations the stock of which is traded through an exchange or over the
counter.
.
No interest of Tenant in this Lease shall be assignable by involuntary assignment through operation of law
(including without limitation the transfer of this lease by testacy or intestacy). Each of tile following acts
shall be considered an involuntary assignment: (a) If Tenant is or becomes bankrupt or insolvent, makes
an assignment for the benefit of creditors, or institutes proceedings under the Bankruptcy Act in which
Tenant is the bankrupt; or if Tenant is a partnership or consists of more than one person or entity, if any
partner of the partnership or other person or entity, if any partner of the partnership or other person or
entity is or becomes bankrupt or insolvent. or makes an assignment for the benefit of creditors; or (b) if a
writ of attachment or execution is levied on this Lease; or (c) if in any proceeding or action to which
Tenant is a party, a receiver is appointed with authority to take possession of the Premises. An
involuntary assignment shall constitute a default by Tenant and Landlord shall have th,: right to elect to
terminate this Lease, in which case this Lease shall not be treated as an asset of the Tell3Ilt.
~19. DEFAULT. The following occurrences shall each be deemed an Event of Default by TelOant:
~<::,~ ~n,} a. Failure to l'ay. Tenant fails to pay any sum, including Rent, due under this Lease.
L ,.' /.'\.
/>(~
..........;:>.0p Vacation/Abandonment. Tenant vacates the Premises (defined as an absenc" for al least 15
</ ~ consecutive days without prior notice 10 Uutdlord), or Tenant abandons the Premises (defmed as
an absence of five (5) days or more while Tenant is in breach of some other tenn of this Lease).
Tenant's vacation or abandonment of the Premises shall not be subject to any tlotice or right to
cure.
c. Insolvency. Tenant becomes insolvent, voluntarily or'involuntarily bankrupt, or a receiver,
assignee or other liquidating officer is appointed for Tenant's business, provided that in the
event of any involuntary bankruptcy or other insolvency proceeding, the eKistence of such
proceeding shall constitute an Event of Default only if such proceeding is not dismissed or
vacated within 60 days after its institution or commencement.
d. Levy or Execution. Tenanl"s interest in this Lease or the Premises, or any part thereof, is taken
by execution or other process of law directed against Tenant, or is taken UpoOI or subjected to
COMMERCIAL LEASE AGREEMENT - 6
LANDLORD'S INITIALS:
TENANT'S INITIALS:
n~g .
~~
any attachment by any creditor of Tenant, if such attachment is not discharged within 15 days
after being levied.
e. Other Non-Monetary Defaults. Tenant breached any agreement, term or covenant of this
Lease other than one requiring lh~ payment of money and not otherwise enumerated in this
Section, and the breach continues for a period of 30 days after notice by Lan.ilord to Tenant of
the breach.
20. REMEDIES. Landlord shall have the following remedies upon an Event of Default. Landlord's rights
and remedies under this Lease shall be cumulative, and none shall exclude any other right or remedy
allowed by law.
a. Termination of Lease. Landlord roay terminate Tenant's interest under the Lease, but nO act
by Landlord other than written notice from landlord to Tenant of termination .hall terminate thi.
Lease. The Lease shall terminate on the date specified in the notice of termination. Upon
termination of this Lease, Tenant will remain liable 10 Landlord for damages iJ. an amount equal
to the rent and other sums that would have been owing by Tenant under this Lease for the
halance of the Lease term, less the net proceeds, if any, of any reletting of the Premises by
Landlord subsequent to the termination, after deducting all Landlord's Reletting Expenses (as
defined below). Landlord shall be entitled to either collect damages from Ten""t monthly on the
days on which rent or other amounts would have been payable under the Leas", or alternatively,
Landlord roay accelerate Tenant's obligations under the Lease and recover from Tenant: (i)
unpaid rent which had been earned at the time of termination; (ii) the amount by which the
unpaid rent which would have been earned after termination until the time of ,award exceeds the
amount of rent loss that Tenant proves could reasonably have been avoided; (iii) the amount by
which the unpaid rent for the balance of the term of the Lease after the time of award exceeds
the amount of rent loss that Tenant proves could reasonably be avoided (discounting such
amount by the discount rate of the Federal Reserve Bank of San Francisco ilt the time of the
award, plus 1%); and (iv) any other amount necessary to compensate Landlord for aU the
detriment proximately caused by Tenant'. failure to perform its obligations WIder the Lease, or
which in the ordinary course would be likely to result from the Event of Default, including
without limitation Reletting Expenses described in Section 20(b).
b. Re-Entry and Reletting, Landlord may continue this Lease in full fore<. and effect, and
without demand or notice, re-enter and take possession of the Premises Or any part thereof,
~ expel the Tenant from the Premises and anyone claiming through or under the Tenant, and
remove the pen;onal property of either. Landlord may relet the Premises, or any part of them,
.A in Landlord's or Tenant's name for the account of Tenant, for such period of time and at such
(l/!/~ other ~ and conditions, as Landl~rd, in its discretion, ",:,y determin~. ulIIdlord may. collect
..-' / <' '\\ and receIve the rents for the PrelD1ses. Re-entry or taking possession of the PrelD1ses by
(/~~J .andlord under this Section shall not be consllUed as an election on Landlord'" part to terminate
. s Lease, unless a written notice of termination is given to Tenant. Landlord reserves the right
following any re-entry or reletting, Or both, under this Section to exercise its rights to terminate
the Lease. During the Event of Default, Tenant will pay Landlord the rent and other sums
which would be payable under this Lease if repossession had not occun'ed, plus the net
proceeds, if any, after reletting the Premises, after deducting Landlord's Rc:letting Expenses.
Rent collected by Landlord, after reletting the Premises. shall be credited to Tenant's rent
obligation. "Reletting Expenses" is defined to include all expenses incurred by Landlord in
connection with reletting the Premises, including without limitation. all n'l'OSS"SSion costs,
brokerage commissions. attorneys' fees, remodeling and repair costs, costs for removing and
storing Tenant's property and equipment, and reasonable rent concessions granted by Landlord
to any new Tenant, prorated over the life of the new lease.
COMMERCIAL LEASE AGREEMENT - 7
LANDLORD'S INITIALS:~~
TENANT'S INITIALS: ~
c. Waiver of Redemption Rights. Tenant, for itself, and on behalf of anJ and all persons
claiming through or under Tenant, including creditors of all kinds, hereby waives and surrenders
all rights and privileges which they may have under any present or future law to redeem the
Premises or to have a continuance of this Lease for the Lease term. as it may have been
extended.
d. Nonpayment of Additional RenL All costs which Tenant agrees to pay to Landlord pursuant
to this Lease shall in the event of nonpayment be treated as if they were payments of Rent, and
Landlord shall have all the rights herein provided for in case of nonpayment of Rent.
e. Failure to Remove Property, If Tenant fails to remove any of its property from the Premises at
Landlord's request following an uncured Event of Default, Landlord may, at its option, remove
and store the property at Tenant's expense and risk. If Tenant does not pal' the storage cost
within five (5) days of Landlord's request, Landlord may, at its option, have .any or all of such
property sold at public or private sale (and Landlord may become a purchaselr at such sale), in
such manner as Landlord deems proper, without notice to Tenant. Landlord shall apply the
proceeds of such sale: (i) to the expense of such sale, including reasonable attorneys' fees
actually incurred; (ii) to the payment of the costs or charges for storing such property; (iii) to
the payment of any other sums of money which may then be or thereafter become due Landlord
from Tenant under any of the terms hereof; and (iv) the halance, if any, to T.onant. Nothing in
this Section shall limit Landlord's right to sell Tenant's personal proeprty as p',rmitted by law to
foreclose Landlord's lien for unpaid rent.
21. ENTRY ON PREMISES. Landlord and its authorized representatives shall have the right to enter the
Premises at all reasonable times for any of the following purposes: (a) To determine wh,:ther the Premises
are in good condition and whether Tenant is complying with its obligations under thil; Lease; (b) To do
any necess:uy maintenance and to make any restoration to the Premises or the Project that Landlord has
the right or obligation to perform; (c) To post 'for salefl signs at any time during the lerm, to post 'for
rent" or 'for lease" signs during the last 90 days of the term, or during any period while Tenant is in
default (d) To show the Premises to prospective brokers, agents, buyers, Tenants or persons interested in
~ an exchange, at any time during the term; or (e) To repair, maintain or improve the PIOject and to erect
scaffolding and protective barricades around and about the Premises but not so as to prevent entry to the
~ Premises and to do any other act or thing necessary for the safety or preservation of the. Premises or the
c/) , Project. Landlord shall not be liable in any manner for any inconvenience, disturbance:, loss of business,
,:::;:::::>~ nuisance or other damage arising out of Landlord's entry onto the Premises as provided:in thil; Section 21.
(/,() \ Tenant shall not be entitled to an abatement or reduction of rent if Landlord exercises any rights reserved
::: ~~ Section 21. Landlord shall conduct its activities on the Premises as provided berein in a manner
/_ will cause the least inconvenience, annoyance or distUIbance to the Tenant For each of these
purposes, Landlord shall at all times have and retain a key with which to unlock all the doors in, upon and
about the Premises, excluding Tenant's vaults and safes. Tenant shall not alter any lock or install a new
or additional lock or bolt on any door of the Premises without prior written conseni: of Landlord. If
Landlord shall give its consent, Tenant shall in each case furnish Landlord with a key for any such lock.
22. SUBORDINATION. Without the necessity of any additional document being executed by Tenant for the
purpose of effecting a subordination, and at the election of Landlord or any mortgagee or any beneficiary
of a Deed of Trust with a lien on the Project or any ground lessOr with respect to the Project, this Lease
shall be subject and subordinate at all times to (a) all ground leases or underlying leaSES which may now
exist or hereafter be executed affecting the Project, and (b) the lien of any mortgage or deed of trust which
may now exist or hereafter be executed in any amount for which the Project, ground leases or underlying
leases, or Landlord's interest or estate in any of said items is specified as security. In the event that any
ground lease or underlying lease terminates for any reason or any mortgage or deed of trust is foreclosed
or a conveyance in lieu of foreclosure is made for any reason, Tenant shall, nOlwithstanding any
subordination, attorn to and become the Tenant of the successor in interest to Landlord, at the option of
COMMERCIAL LEASE AGREEMENT - 8
LANDLORD'S INITIALS: ~i&
TENANT'S INITIALS:
cJ1
such successor in interest. Tenant covenants and agrees to execute and deliver, upon demand by Landlord
and in the fonn requested by Landlord any additional documents evidencing the priority or subordination
of this Lease with respect to any such ground lease or underlying leases or the lien of 3'OY such mortgage
or deed of trust. Tenant hereby irrevocably appoints Landlord as auorney-in-fact of Tenant to execute.
deliver and record any such document in the name and on behalf of Tenant. Provided, that this
appointment shall have effect only in the event that Tenant fails to execute and deliver the previously
mentioned documents to Landlord upon demand, within forty-eight (48) hours of the d'lmand, excluding
weekends and holidays.
Tenant, within ten days from notice from Landlord, shall execute and deliver to Landlord, in recordable
form, certificates stating that this Lease is not in default, is unmodified and in full fore(' and effect, or in
full force and effect as modified, and stating the modifications. This certificate should also state the
amount of current monthly rent, the dates to which rent has been paid in advance, and the amount of any
security deposit and prepaid rent. Failure to deliver this certificate to Landlord within ten days shall be
conclusive upon Tenant that this Lease is in full foICe and effect and has not been moditiied except as may
be represented by Landlord.
23. NOTICE. Any notice, demand, request, consent, approval or communication desired by either party or
required to be given, shall be in writing and served either personally or sent by prepaid certified first class
mall. addressed as set forth in Section 1. Either party may change its address by notification to the other
party. Notice shall be deemed to be communicated 40 hours from the time of mailing, if mailed, or from
time of service, if personally served, as provided in this Section 23.
24. WAIVER No delay or omission in the exercise of any right or remedy by Landlord shall impair such
right or remedy or be construed as a waiver. No act or conduct of Landlord, including without limitation,
acceptance of the keys to the Premises, shall constitute an acceptance of the surrender of the Premises and
accomplish termination of the lease. Landlord's consent to or approval of any act by Tenant requiring
Landlord's consent of approval shall not be deemed to waive or render unnecessary LancUord's consent to
or approval of any subsequent act by Tenant. Any waiver by Landlord of any default must be in writing
and shall not be a waiver of any other default concerning the same or any other provision of the Lease.
25. SURRENDER OF PREMISES; HOLDING OVER Upon expiration of the term, Tenant shall
surrender to Landlord the Premises and all Tenant improvements and alterations in good condition,
except for ordinary wear and tear and alterations Tenant has the right or is obligated to remove under the
~ provisions of Secti,on 13 herein. Tenant shall remover all personal property including without limitation
( ('-!. all wallpaper, paneling and other decorative improvements or fixtures and shall perform all restoration
.~ A made necessary by the removal of any alterations or Tenant's personal property before the expiration of
(( ) I the term, including for example, restoring all wall surfaces to their condition prior to th,: commencement
.r<\ of this Lease. Landlord.can elect to retain or dispose of inany manner Tenant's perso~l property .not
, ...,... ~moved from the Prellllses by Tenant pnor to the exptraUon of the term. Tenant W3Ives all cl3lms
.' (,against Landlord for any damage to Tenant resulting from Landlord's retention or dispo!,ition of Tenant's
r;..'Personal property. Tenant shall be liable to Landlord for Landlord's costs for storage, removal or disposal
V of Tenant's personal property.
If Tenant, with Landlord's consent, remains in possession of the Premises after expiraticln or termination
of the term, or after the date in any notice given by Landlord to Tenant terminating this Lease in
accordance with the provisions of this Lease, such possession by Tenant shall be deemed 1:0 be a month-to-
month tenancy terminable on 30-day notice at any time, by either party. All provisions of this Lease,
except those pertaining to term and rent, shall apply to the month-to-month tenancy. Tcmant shall pay a
Base Monthly Rent in an amount eqnal to 125% of the Base Monthly Rent for the last full calendar month
prior to the expiration or termination of the tenn.
COMMERCIAL LEASE AGREEMENT - 9
!Ji-1 .
LANDLORD'S INITJALS:'Sl::E:.~
TENANT'S INITIALS: ~
26. MORTGAGEE PROTECTION. In the event of any default by Landlord, Tenant will give notice by
registered or certified mail to any beneficiary of a deed of trust or mortgagee of a mortgage covering the
Premises whose address shall have been furnished to Tenant, and shall offer su<:h beneficiary or
mortgagee a reasonable opportunity to cure the default, including time to obtain possession of the
Premises by power of sale or a judicial foreclosure, if such should prove necessary to effect a cure.
27. LIMITATION OF LIABILITY. Landlord and Tenant agree no shareholders, members, officers,
directors, or other principals of Landlord shall have any personal liability to Tenant as the result of any
breach or default by Landlord under this Lease.
28. MISCELLANEOUS PROVISIONS.
a. Severability. Any provision of this Lease which shall prove to be invalid, void, or illegal shall in
no way affect, impair, or invalidate any other provision'oflhis Lease.
b. Successor. 11Iis Lease shall be binding on and inure to the benefit of the parties and their
successors, except as provided in Section 18 herein.
c. Landlord's Consent. Any consent required by Landlord under this Lease must be granted in
writing and unless expressly stated otherwise shall not be unreasonably withheld.
d. Commissions. Each party represents that it has not had dealings with any real estate broker,
finder or other person with respect to this Lease in any manner, except for the broker identified
in Section I, who sball be compensated by the party identified in Section 1.
COMMERCIAL LEASE AGREEMENT - 10
LANDLORD'S INITlALS:
TENANT'S INITIALS:
~g
9JI
29. TOXIC OR HAZARDOUS SUBSTANCES. With respect to any release of toxic or hazardous
substances or wastes or other condition of the Premises occurring on or after the date of the Lease and
caused by or resulting from the negligent acts or omissions or willful misconduct of TerulJnt. its employees.
authorized agents, or contrnctors, and which release or other condition violates the provisions of, or
necessitates any removal, treatment or other remedial action under, any past, present. '~r future federal,
state or local statute or ordinance or any regulation, directive, or requirement of any governmental
authority with jurisdiction relating to protection of the environment. Tenant agrees to dl:fend, indemnify,
and hold harmIess Landlord, its partners, employees, agents, and contractors, from and against any and
all losses, claims, liabilities, damages, demands, fines, costs and expenses (including reasonable attorneys'
fees and legal expenses) arising out of or resulting therefrom. The provisions of this Paragraph shall
survive the termination or expiration of this Lease and the surrender of the Premises by Tenant. with
respect to releases, events, or conditions occurring prior to such termination, expiration, or surrender.
With respect to any release of toxic or hazardous substances or wastes or other condition of the Premises
occurring prior to the date of this Lease and caused by or resulting from the negligent acts or omissions or
wiUful miscondnct of Landlord, its employees, authorized agents, or contractors, and which release or
condition violates the provisions of, or necessitates any removal, treatment. or other remedial action
under, any past, present. or future federal. state, or local statute or ordinance or any regulation,
requirement. or directive of any governmental authority with jurisdiction relating to ;protection of the
environment. Landlord agrees to defend, indemnify, and hold hannless Tenant from and against any and
all losses, claims, liabilities, damages, demands, fines, costs, and expenses (including reasonable
attorneys' fees and legal expenses) arising out of or resulting therefrom.
Tenant shall remove any sumps and clarifiers and any related hazardous Materials (" Hazardous
Material" shall mean petroleum and petroleum products, asbestos,.and PCB's and any "hazardous
substances". "hazardous materials" or .. toxic substances" in the Comprehensivt, Environmental
Response, Compensation and Liability Act of 1980, as amended, the Hazardous materials Transportation
Act, as amended, or the Resource Conservation and Recovery Act, as amended, and .. hazardous" or
"toxic" in the regulation adopted or publication promulgated pursuant to any of said laws) in or about the
Premises and associated with Tenant's use and occupancy thereof upon the expiration or earlier
termination of this Lease. Reference is also made to Section 13, page 4: Alterations.
30.
OTHER In addition to any other remedies available to Tenant, this Agreement shall be subject to
cancellation by the Tenant should anyone or more of the following events occur:
~
<QJ~ :.
<~
The permanent abandonment of Auburn Municipal Airport.
The assumption by the Federal Government or any other governmental agency of the control of
Auburn Municipal Airport or any portion thereof in a manner which would preclude Tenant from
operation under the tenus of this Lease or which would substantially restirct T'enant's operation
under the tenus of this Lease.
31. EXECUTION OF AGREEMENT BY CORPORATION AND GUARANTY. If Tenant is a
corporation, each individual executing this Agreement on behalf of said corporation represents and
warrants that shelhe is duly authorized to execute and deliver this Agreement on behalf of said
corporation in accordance with a duly adopted resolution of the Board of Directors of said corporation or
in accordance with the Bylaws of said corporation, and that' this Agreement is binding upon said
corporation in accordance with its terms. As a condition of this Lease and in considel'lltion of benefits
derived, the individuals executing this Agreement on behalf of said corporation unconditionally
guarantee, jointly and severally, to Landlord the full performance of this Lease by Tenant. If Tenant is a
corporation, Tenant shall within thirty (30) days after execution of this Agreement, deliver to Sky
Services, Inc. a certified coPY of a resolution of the Board of Directors of said corporatic,n authorizing or
ratifying the execution of this Agreement.
COMMERCIAL LEASE AGREEMENT - II
i)'/ .
LANDLORD'S INITIALS:~~
TENANT'S INITIALS: --:p.---
32. CITY RULES AND REGULATIONS. Tenant shall comply with all applicable rules and regulations
promulgated by the City of Auburn for the Auburn Municipal Airport.
33. NO SMOKING. Tenant shall pennit no smoking inside any portion of the building located upon the
Premises.
34. EARLY TERMINATION AND FIRST RIGHT OF REFUSAL TO PURCHASE OR LEASE
ENTIRE PROJECT. In the event Landlord receives an offer during any term of this Lease to purchase
or lease the entire Project, Landlord shall have the right to tenninate this Lease effective six (6) months
after the date the sale or lease is closed. Provided, however, Landlord's right to tenninate the Lease shall
not be effective unless Landlord has first offered to sell or lease the Project to Tenant on the same terms
and conditions offered to Landlord by a third party. Tenant shall have twenty (20) days from the date of
Landlord's written notice conveying to Tenant a copy of the purchase or lease offer Landlord intends to
accept in which to give written notice to Landlord that Tenant agrees to purchase or lease the Project on
the same terms and conditions of that offered. In the event Tenant does not commit to purchase or lease
the Project, then Landlord shall be free to sell or lease the Project to the offeror and ex.:rcise Landlord's
right to tenninate this Lease eady.
35. RENEWAL OPTION. Provided Tenant is not in default at the time of exercise or upon the
commencement of any extension term, Tenant shall have the option to extend the term of this Lease one
(I) additional term of five (5) years. Tenant shall exercise each option by delivering with 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 Rent stated in the Lease, which shall be increased to the: amount of fair
market rental for the Premises, but in no event shall the minimum base rent be less than 110% of the Base
Monthly Rent during the initial five (5) year term. If Landlord and Tenant are not able: to agree on the
amount of fair market rental within thirty (30) days after the date Tenant exercises its extension option in
each case, then the parties shall submit the detennination of the fair market rental value of the Premises to
~ binding arbitration. If Landlord and Tenant are not able to agree upon a single arllitrator within thirty
(30) days of their agreement to arllitrate the dispute, then during the following ten (0) day period,
(Q2 Landlord and Tenant shall each designate an expert, who shall be a licensed MIA appraiser or a
~ commercial real estate agent with at least five (5) years experience in the commercial Ic:asing market in
~ ~!llch the Premises are located. The two experts so selected shall appoint an arllitrator similarly qnalified,
</\. ~ose detennination of fair market rental value shall be binding upon Landlord and Tenant. Each party
. -..::.s~bear their own expenses of the arllitration except that the cost of the arllitrator shall be paid by the
, hose final offer of fair market rent during the thirty (30) day negotiation period is farthest from the
aunt determined by the arllitrator.
36. EARLY TERMINATION BY TENANT ON FAILURE TO REACH AGREEMENT ON
PURCHASE TERMS. Tenant intends in good faith to pursue a purchase of the Project from Landlord,
during the term. However, should such purchase not occur because Landlord and Tenant fail to agree on
terms which are not less favorable to Landlord than those Tenant previously offered for such purchase, or
Landlord detennines not to sell the Project, Tenant reserves the right to tenninate this Lease upon
reasonable notice and construction of a comparable facility. Therefore, in the event that during any term
of this Lease Tenant makes an all cash offer to purchase the Proji:ct from Landlord for" sum of at least
Three Hundred Fifty Thousand Dollars ($350,000) which is rejected by Landlord, and Tenant thereafter
begins construction of a comparable facility to the Project at the Auburn Municipal Airplrt, then Tenant
COMMERCIAL LEASE AGREEMENT - 12
(\ k1 .
LANDWRD'S INITIALS: <::::!7.:D --4L,
TENANT'S INITIALS: ~
"
shaIl have the right, on six (6) months' written notice, to terminate this Lease early, and such early
termination wiIl not be considered an Event of Default under Section 19 and will not make Tenant liable
for any remedies under Section 20.
IN WITNESS WHEREOF, Landlord and Tenant have executed this lease this -Y- day of April, 1998,
Landlord: SKY SERVICES, INC.
By: ,,(lpM.Q.~
Print Name and Title: ~ c... (a.c.
FEIN: efl-(;' 91.if.; II
s~ /77"eQS
/
Tenant: AUBURN FLIGHT SERVICES, INC.
By: ~~ s(~~,f'~~
Prim Nam and Title: ~I ." (VI t~..f:. ,(!. /1, IIMI ~, AUToS
By:
Print Name and Title:
FEIN: f!/'" i/~ 771/7
STATE OF WASHINGTON )
) ss.
COUNTY OF KING )
On this 7 day of ~ 1998, before me a Notary Public in and for the State of
Washington, personally appeared ::Lrf!Ne.. 5/o.c.(iUr,,,&1 to me known to be the See I /ff." s.
of Sky Services, Inc., a Washington corporation that executed the foregoing instrument, and ac\;nowl&lged it to be
the free and voluntary act of said corporation, for the uses and purposes mentioned in this instmment, and on oath
stated that they were authorized to execute said instrument.
IN WITNEs.::.-Wl'ffiI\IiiO\,:, I have hereunto set
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NOT MY PUBLIC, in and for the State
of Washington, residing at ~I 0.)\ ~ 0
My appointment expires j . A .0 1_
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) ss.
COUNTY OF KING )
On this ~ day of (\ Q {; \ . 1998, before me a Notary Public in aDi~ for the State of
Washington, personally appeared 30.""".\\0 (')Q< U c.. and /oJ I A . to me
known to be the President and Secretary of Auburn Flight Services, Inc., a Washington corpomtion that executed
the foregoing instrument, and acknowledged it to be the free and voluntary act of said corporation, for the uses and
purposes mentioned in this instrWneot, and 00 oath stated that they were l!uthorized to execute said instrument.
IN ~~OF, I have hereunto set my band and official seal the
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COMMERC~ffi1llSS-At3REEMENT - 13
y and year first above
~C::;\\G.""'r-' A ~l", T~
NOT MY PUBLIC, in and for the State
of Washington, residing at K , N l' C C) .
My appointment expires I .:1-. d'1. I _
LANDLORD'S INITIALS:~~
TENANT'S INITIALS:
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EXHIBIT A
TIffi PREMISES
, PREMISES:
Approximately 6,424 square feet of building area as shown on
the sketch attached as Exhibit A-I, plus exclusive use of
airplane tie-down areas, together with the nonexclusive right
to use the areas described in Section 2.
EXHIBIT B
TIffi PROJECf
PROJECf:
The entire properly of approximately three (3) acres which is
subject to a master ground lease with the City of Auburn.
Legal Description:
Attached as Exhibit B-1..
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COMMERCIAL LEASE AGREEMENT - 14
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TENANT'S INITIALS: ~
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EXHIBIT A-l
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EXHIBIT B.I
LEGAL DESCRIPTION
!!'hat portion of the J. Brannan Donation Claim No. 38 situate in Section 7,.
'I'OomJIhip 21 North, llange 5 East, W.H. described as follows:
. -
'BegUuung at the r!.ortheast corner of the J. .Brannan ~t1on Cl..1~1 iro; 381.
tbence N 88049'5,01 Ii 430.01 feet; thence S 0'5:1'25" W i3:10.42'.feel: to.the'
'1't~ PoJ.n.t: of Begiriningl thence continu.1.n!1 S' 0052' 25" H 260.00 fe"~I' tMnce 'i
N 88053'43" " 530.00 feetl thence N 0'52' 25" E 260.00 teetl t:heilc~i s. 88.53'43....
E 530.00 feet to t:h!l !l'rue Point of Beginning ~ the east 2S tHt tOr stZ'fiet:,'
situate J.n the city or Auburn, King County, WlIShJ.ngtcin~ .
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3.01 Acres
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COMMERCIAL LEASE AGREEMENT -15
LANDLORD'S ."''-'LS, $ ~
TENANTS INITIALS: __
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EXHIBIT C
SIGN REGULATIONS
PROJECT:
BLDG.IUNIT:
Signs or symbols placed in the windows or doors or elsewhere about the Premises, or upon any c:xterior part of the
building by the lessee shall be subject to approval of the Lessor or Lessor's agents. In the event Lessee shall place
signs or symbols on the exterior of said building. or in the windows or doors or elsewhere where they are visible
from the street, that are not satisfactory to the Lessor or Lessor's agents, the Lessor or Lessor's agents may
immediately demand the removal of such signs or symbols, and the refusal of the Lessee to comply with such
demand within a period of 24 hours will constitute a breach of this Lease, and entitle the i..es.lor to immediately
recover possession of said Premises in the manner provided by law. Any signs so placed on the Premises shall be
so placed upon the understanding and agreement that Lessee will remove same at the termination of the tenancy
herein created and repair any damage or injury to the Premises caused thereby, and if not SO removed by Lessee
then Lessor may have such signs or symbols removed at Lessee's expense.
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COMMERCIAL LEASE AGREEMENT - 17
LANDLORD'S INITIALS:
TENANT'S INITIAlS:
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