HomeMy WebLinkAboutPFM Enterprises IncWednesday, January 15, 2003
SUBLEASE
This Sublease ("Sublease") is entered into this/~y of January, 2003 between the
City of Auburn, a Washington municipal corporation CSublessor"), and PFM Enterprises, Inc.,
a Washington Corporation ("Tenant").
RECITALS:
.A. By that certain Sublease dated June 26, 2002 Sublessor, as Tenant, leased from
Central Puget Sound 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 hereto as
Exhibit 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.
C. Accordingly, Sublessor and Tenant agree as follows:
SUBLEASE
1. 1. SUMMARY 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.
1.1 Sublessor. The "Sublessor" is the City of Auburn, a Washington
municipal corporation, acting in its proprietary capacity.
1.2 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 Exhibit B attached hereto and the location of
the Parking Garage is outlined on the site plan of the Auburn Transit Station 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 commonly known as 110 'A' Street
S.W., Suite A__, Auburn, Washington 98001. The Premises includes all windows and other
Wednesday, Janua~ t~,2003
glass in the exterior wall(s) of the Parking Garage within the area outlined on the Exhibit A floor
plan and all doors leading into 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 Exhibit A floor plan.
1.4 Plaza Tenant Area. The Premises (CHECK ONE):
does
X does not
include all or any part of the Plaza Tenant Area.
1.5 Commencement Date. The Term of this Sublease shall commence on
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 in
this Sublease, the Term of this Sublease shall expire at midnight on May 14, 2008 , or such
earlier or later date as provided in paragraph 3 ("Expiration Date").
1.7
Right to Extend. Tenant (CHECK ONE):
X does
docs not
have a right to extend the Term of this Sublease. If Tenant does have a right to extend, the terms
and conditions of such right are set forth in the Right To Extend Rider attached hereto.
1.8
(CHECK ONE):
Base Monthly Rent. The base monthly rent ("Base Monthly Rent") is
$ 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 Twenty 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.
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1.10 Late Charge. The late charge is five percent of each Late Payment due
from Tenant to Sublessor.
1.11 Securi .ty Deposit. The amount of the security deposit is Two Thousand
Dollars end No/100 ($2,000.00) .
1.12 Permitted Use. The Premises shall be used only for office uses
1.13 Sublessor's Notice Addresses: Subject to change as provided in
paragraph 32, "Sublessor% 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:
Attention:
PFM Enterprises, Inc.
Pat Muldary
1980 Island Parkway East
Sumner, Washington 98390
except that after the Commencement Date end 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 Ad.|ustments to Tenant's Share. Tenent's Prorata Share is calculated as
the percentage, which is the same percentage of the rentable square feet in the Premises bears to
the rentable square feet of the Commercial Tenent Area. For these purposes, Sublessor and
Tenant agree that, at commencement of the Term, the Premises has 2,105 rentable square feet
end the Commercial Tenant Area has 13,490 rentable square feet.- Sublessor may recalculate
the Tenant's Prorata Share fiom time to time during the Term if there is a change in
configuration of the Premises or eny other space in the Commercial Tenent Area. If Sublessor
recalculates Tenant's Prorata Share, Sublessor shall give Tenant written notice of the new
calculations end of the new amounts of the Tenant's Prorata Share. The 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
is given.
2. DEFINITIONS. Wherever used in this Leased the following terms in quotation
marks have the meanings specified below.
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We(Jnesday, January 15, 2003
2.1 "Additional Rent" is defined in paragraph 7.
2.2 "Base Monthly Rent" is defined in paragraph 1.8.
2.3 "Commercial Tenant 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" means those portions, areas and facilities of the
Commercial Tenant Area and those portions of the parking garage common areas as defined in
Section 1.1 (d) of the Master Sublease that Sublessor, fi.om 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 leased or held for the
exclusive use of a particular tenant. Common Areas may, but do not necessarily include,
hallways, corridors, docks, loading areas, restromns, 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 govemmental capacity) or other local law,
statute, ordinance, code, iegulation, 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 the 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 the Auburn Transit Center that are outlined
and labeled "Plaza" and "Plaza Tenant Area" on the Exhibit C site plan.
2.12 "Plaza Tenant Area" means that 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 1.3 and, if applicable, paragraph 1.4.
Wednes~ay, Janua~ 15,2003
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
attached hereto as Exhibit C and includes the Parking Garage, the Property.
2.18 "Sublessor" is defined in thepamgraph 1.1.
2.19 "Sublessor's Notice Address" is defined in paragraph 1.13.
2.20 "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 all-inclusive. Other terms arc defined elsewhere in
this Sublease.
3. SUBLEASE. On the terms and conditions specified in this Sublease, Sublessor
leases the Premises to Tenant and Tenant leases the Premises from Sublessor.
4. TERM. Subject to (a) earlier termination as herein provided, Co) 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 l(b) (the
"Commencement Date") and shall expire at midnight on May 14, 2008 (the "Expiration
Date").
4.1 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 Commencement Date
for any other purpose, then the Commencement Date shall be the date of occupancy but the
expiration date shall not be changed.
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Wednesday, January 15, 2003
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 thc 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 fight and 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
paragraph or after the Commencement Date, and if 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, and
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 calendar month.
4.3 Confirmation Of Term. Promptly after the request of either Sublessor or
Tenant made at any time after the Commencement Date is known, 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 five 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 late 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 condition its acceptance of any Late Payment on concurrent payment of the applicable late
charge. Sublessor's right to require a late charge is in addition to and cumulative with all 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 Sublessor'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 benefit 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 termination of the Term, Sublessor shall return to
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Tenant (or at Sublessor's option, to the last assignee, if any, of 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
determination and payment of Tenant's Share of Operating Costs. If Sublessor 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.
6.2 Sublessor's Right To Apply. If Tenant fails to pay any sum of money
due to Sublessor fi.om 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 may, 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 thc 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 charges 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. If 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 fifty 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 all 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 first day of each calendar month during the Term. In
this Sublease the term "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 Monthly Rent. Additional
Rent means those costs incurred for the maintenance and operation of the building. 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
notice or demand. The Base Monthly Rent shall be apportioned for any partial calendar month at
the commencement and at the expiration or termination of the Term 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 fi.om, or in connection with this
Sublease shall be made to Sublessor at such place as Sublessor may designate from time to time.
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In the absence of, or in the case of lapse of, any such designation, such payments shall be made
to Sublessor% Notice Address.
8. OPERATING COSTS.
8.1
specified below:
Del'tuitions. The following terms in quotation marks have the meanings
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 "Tax 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 any taxing authority to the extent attributable to any period of time
within the Tenn.
8.1.2 "Maintenance Costs" means the amount of all costs (other than
Tax Costs) incurred by Sublessor in leasing, maintaining and operating the Property.
(i) Without limiting the generality of the foregoing, Maintenance
Costs include those off (a) premiums and deductibles for insurance; (b) refuse removal 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) refuse
and trash removal provided to the Property; (e) maintenance of heating, ventilating, and air-
conditioning equipment, of plumbing and electrical systems, and of all other parts and systems of
the Property; (f) repainting and refurbishing, including replacement of carpet or other floor
covering and drapes or other window treatment; (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); 0) 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 (m)
maintenance of all other parts of the Property, including without limitation foundations, exterior
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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, training,
and uniforms.
(ii) However, "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; (0 costs of capital improvements except as provided in paragraphs 8.1.2(i) and
8.1.2(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 terminates, that part oftbe 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 during the Term bears to that pa~ of the year which is not within 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 good faith shall be binding and conclusive
on Tenant.
8.2 Additional Rent. In addition to the Base Monthly Rent provided in
paragraph 7, Tenant shall pay as Additional Rent of the Premises Tenant's Pmrata Share of the
Operating Costs for each calendar year during the Tenn. To the extent the Term does not
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 between those for which Tenant is obligated
and those which are not. All payments on account of Tenant's Prorata Share of Operating Costs
shall be made when due as, and without further notice than as, provided in this Paragraph 8 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 statement in reasonable detail estimating the
amount of Operating Costs Sublessor expects to incur during the year in which the Term
commences and Tenant's Share thereof. Beginning with the first day of the third calendar month
during the Term which is at least fifteen days after Sublessor's statement is fumished 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 full calendar months during the Term in the first year.
Such payments shall be made together with and in addition to the Base Monthly Rent provided in
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Wednesday, January 15, 2003
Paragraph 7. In addition, with the first such payment on account of such Additional Rent,
Tenant 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 payment 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 furnished at least fifteen days before the first day of
the Term.
8.3.2 Subsequent Calendar Years. As soon as practical after the end
of each calendar year during the Term, 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 (f) 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 (0 become payable shall be calculated on the basis
of there being due on the first day of each calendar month during the current year the amount
specified in part (f). Until Sublessor's statement under this paragraph is furnished, Tenant shall
pay together with and when the Base 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 Overnavments 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
and to the extent of any remaining balance of sBch excess, at Sublessor's election, 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 Right 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 for
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 10 days after
receipt of the Review Notice, Sublessor shall by written notice ("Records Notice") describe the
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location or locations at which Sublessor shall make its 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 fi.om 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 fight) 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
statement and any subsequent statements as being due fi.om 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. In addition to the Base Monthly Rent, Tenant
shall pay to Sublessor in advance on the first day of each month during the Term the leasehold
excise tax required by Chapter 82.29A of the Revised Code of Washington and regulations
adopted pursuant thereto, as such law and/or regulations may hereal~er be amended or replaced,
on account of the taxable rent payable by Tenant under this Sublease on such date.. For
informational purposes, the current rate of the leasehold excise tax is 12.84 per cent.
10. PERMITTED USE. The Premises shall be used only for the use specified in
paragraph 1.12 (the "Permitted Use"), and for no other business or purpose without the prior
written consent of Sublessor, which Sublessor may refuse or condition in its discretion.
11. REQUIREMENTS CONCERNING 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% liability insurance related to the Property or any part thereof. For the
purposes of the preceding sentence, to the extent that Sublessor seif-insures any risks jointly with
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Wednesday, Janua~ 15,2003
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 of their respective premises, the Common Areas or which (in Sublessor's good faith
opinion) interferes with Sublessor'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
Sublessor's 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
without Sublessor's prior written consent, which Sublessor may refuse or condition in its
discretion. Tenant shall at all times keep access to enclosures within the Premises 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 Parking Garage and/or
the Plaza Tenant Area, its safety, care, and cleanliness, and good order therein. A copy of
Sublessor's rules presently in effect is attached hereto as Exhibit D.
11.2 Compliance 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 thereof and, in such case, Tenant shall at its expense make such
modifications (subject, however, to the requirements of paragraph 16). If the enactment or
enforcement 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 at its expense if the
changes are required due to the nature of Tenant's activities at the Premises, or to Tenant
Alterations that were made by Tenant or that Tenant seeks to make.
11.3 Environmental Matters. Without limiting the generality of any
provision of paragraph 11.1 or 11.2, Tenant shall comply, and shall cause all its employees,
contractors and agents to comply, with all 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 Sublessor, Sublessor Related
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Wednesday, January 15, 2003
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. In 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 Station 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.
]2. 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.
Tenant 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
Tenant 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. However, 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 AND CARE OF PREMISER. 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
damage is caused by the Tenant); (e) relights and other glass (including exterior windows if
damage is caused by the Tenant); (f) 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 hot 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 oftbe 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 items, or any other object to the walls,
doors, woodwork, or ceilings or hang things from ceiling support frames without Sublessor's
prior written consent, which Sublessor may refuse or condition in its discretion. Sublessor
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Wednesday, Janua~15, 2003
hereby consents to the hanging fi.om walls of the Premises pictures and other decorator items
weighing tess than 25 pounds each using picture hooks 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 furniture, 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 finns 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
maintenance 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 party is required because of the act or neglect of the other party (or the other
party's agents, contractors, invitces 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 work and final determination of the costs thereof or (b) in installments as and
when due as the work progresses.
14. SERVICES AND UTILITIES.
14.1 General Provisions. Sublessor has the exclusive right to determine who
shall provide electricity or any other utility sen4ce to the Property or any part thereof and who
shall provide facilities at the Property or any part thereof for broadband access to the Internet
(excluding any such access which is available 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 lighting and customary equipment, computers, machines and other devises usual and ordinary
to retail and/or general office use of space in buildings in the general area of downtown Aubum
and (b) water. Sublessor shall provide (c) lamp replacement service for light fixtures in the
Common Areas, (d) cleaning and supplying the restrooms that are part of the Common Areas,
and (e) air-conditioning and heat to the Premises and the interior Common Areas. Tenant shall
provide facilities for furnishing 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.
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Wednesday, January 15, 2003
14.2 Energy Conservation. After 1~0 p.m. (or later) until 7 a.m. (or
earlier) during weekdays and Saturdays and all day on Sundays and holidays, Su~essor may
reduce heating and air-conditioning service and may reduce or turn off lighting in the Common
Areas. From time to time §ublessor may institute and change other measures to conserve
energy, water, or other utilities and Tenant shall comply therewith.
14.3 Excess Requirements. Except as provided in subpart (a) of the first
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 materially increases the load on Sublessor's present air-conditioning equipment or if
Tenant installs any devices which require greater electric service than that described above,
Sublessor has 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 exp~nses (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 on the first day of each calendar month during the Tenn.
14.4 Failure or Interruption of Utilities or Services. 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 from, in whole or in part, any variation in,
interruption of, or f~tilure of any utility service or services described in 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 Sublessor's reasonable control.
15. LIMITATION ON SUBLESSOR LIABILITY. 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 with Tenant's business arising from the making (whether by
Sublessor, Sound Transit or any other person) of any repairs, alterations, additions, or
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 or the Premises or for any loss,
damage, or injury to Tenant or any of its property or its business occasioned by: (a) bursting,
rupture, leakage, overflow, or other failure of any plumbing or other pipes or appurtenances,
including without limitation, water, sewer, refrigerant, and fire-sprinkler systems, water tanks,
and dishwashers; Co) backing up of any sewer line, drain, drainpipe, downspout, or gutter; (c)
water, snow or ice upon or coming through the roof, 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 to person 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
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Wednesday, January 15, 2003
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 Improvement Rider, if any, 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 damaging the Property or 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
Prop~ty. Unless othenvise specified by Sublessor in its consent to a Tenant Alteration, the
Tenant Alteration shall belong to Tenant and, at the expiration or earlier termination of the Term,
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 randering 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
Parking Garage or any part thereof (including Sound Transit and its licensees), and pay the costs
thereof as and when due. Tenant shall also pay Sublessor a fee for Sublessor's oversight and
coordination of the work of the Tenant Alteration 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 specifications 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-making acting in its governmental
capacity pursuant to any such applicable Law.
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Wednesday, January 15,2003
17.LIENS. 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 any fixture thereof or to all 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 al~er Sublessor's demand, Tenant shall either (a) cause any claim of such
lien which has been recorded in the real property records or filed in the personal 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 claimant or, (b) to provide a
bond against any claim of such lien ifa law or an agreement with the claimant provides the effect
of posting the bond has the effect of releasing the claim of lien from the properly or rights
against which the lien was filed or otherwise created.
18. ASSIGNMENT AND SUBLETTING.
18.1 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 Sublessor's diseretion. 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 shall 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 all 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 within fifteen days al~er 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.
18.2 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; Co) 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 25% or more of the corporation's shares of stock,
whether such change occurs by transfer of existing shares or issuance of new shares or a
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Wednesday, January 15, 2003
combination thereof or in one or more transactions or at one time or over any period of time; (0
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 new interests or a combination thereof or in one or more
transactions or at one time or over any period of time; (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 of part (g), ifa 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 thc Term, Tenant shall:
19.1 quit and surrender the Premises broom clean and otherwise in the same
condition and in as good 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 15;
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 14 and 16 shall be performed by finns 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
may remove and store the same at Tenant's risk and expense or sell the same or discard the same.
All of the foregoing obligations and all 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 in
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, maintaining, 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 Sublcssor's rights herein or under
Law. After not less than two days' prior notice, Sublessor and its employees and agents shall
have the right of access and Tenant shall permit such access to thc Premises for the purpose of
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Wednesday, Janua~ 15,2003
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.
21. DAMAGE AND DESTRUCTION. If any part of the Premises or of the
Property or of the 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 Term effective as of the date of the casualty. Sublessor shall give Tenant notice
in writing of its election within ninety days after the date of the casualty. If Sublessor does not
give its notice within such period, as Tenant's sole and exclusive fight 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 by 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
such 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 Premises 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, Rent 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, permittees 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
untenantable portion of the Premises, if any, bears to the whole thereof, and this Sublease shall
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 Tenant by reason of or arising fi'om the
casualty or of the repairs or rebuilding.
22. EMINENT DOMAIN. If all of the Premises are taken by any person or public
authority under the power of eminent domain, then the Term and this Sublease shall terminate as
of the date the taking person or authority is entitled to possession under such power. If any part
of the Premises, the Property, the Parking Garage or any of Sublessor's interest therein shall be
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Wednesday, January 15, 2003
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 not 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 to 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 (60) 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 Tenn. In addition, and notwithstanding any of the preceding provisions of
this paragraph, Tenant may terminate the Term and this Sublease if not previously terminated the
taking includes a part of the Premises and Sublessor has not completed any restoration 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 sentence may be made only by written notice of termination specifying an
effective date of termination 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 but not more than thirty 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 Tenant'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)
separately made in addition to the value of the property taken (and, if applicable, damage 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 all 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 after 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.
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23. INSURANCE.
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 nonowned 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 single occurrence and shall
have only those deductibles of kinds and amounts reasonably satisfactory to Sublessor.
23.2 Property. Insurance. At all times during the T¢,m, at its expense Tenant
shall obtain and maintain in full force and effect a policy of property insurance insuring all
Tenant's property located in or about the Premises, the Property and the Station against loss 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 full 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 Other Tenant Insurance. Sublessor has the right to require Tenant to
obtain and maintain such other insurance and bonds (such as but not limited to professional
liability insurance and/or fidelity bonds) as Sublessur in good faith determines 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
commences and before Tenant occupies or uses any part of the Premises for any purpose copies
of the policies required of Tenant under this paragraphs 23 and the respective insurer's written
certification to Subtessor that the policy is in full force and effect with premiums fully paid. At
the same time, Tenant shall also deliver to Sublessor proof reasonably satisfactory 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 Requirements Concerning Tenant's Insurance Policies.
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Wednesday; January 15, 2003
23.5.1 General Requirements. Each policy of insurance Tenant is
required to maintain under this Sublease shall: (a) be issued by an insurance carrier reasonably
satisfactory to Sublessor; (e) provide that the policy is primary and not excess 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 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 of any modification of such coverage (including but
not limited to a change in deductible amounts).
23.5.2 Optional Remedy 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 alter 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 Naming Governmental Unit As Additional Insured. Each
policy required of Tenant under this Sublease that is to name either or both of Sublessur 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 Subrogation. 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
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. 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 pu120ose of this provision, self-insurance by
Sublessor is not the equivalent of having an insurance policy.
24. INDEMNIFICATION.
24.1 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, permittees or contractors; (b)
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Wednesday, January 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, loss, 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 Immuni .ty. Tenant's obligations under paragraph 24.1 extend
to, without limitation, injuries to Tenant's employees (as such employees are defined in 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.
~5. TENANT TAXES AND OTHER 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 Tenant's property, Tenants income, gross receipts, or other revenues, Tenant's use
of the Premises, and Tenant's business.
26. SIGNS.
26.1 General Requirements. Except 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% 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. In
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. In 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 Term, 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.
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26.2 Permanent Signs. 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 Teml~orarv Signs. 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 Auburn, 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. SUBORDINATION. 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 attomment, 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
transferee of all or any part of the Property or any interest therein may request that Tenant
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
payments 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")
may 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 and 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
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Wednesday, Janua~15, 2003
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 hereof. Tenant shall be in
"default" of its obligations under this Sublease if Tenant does not pay or perform an obligation
imposed by it by this Sublease or by Law arising from and on account of this Sublease when 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 pay its debts when due; or
29.1.2 if Tenant attempts to assign any of its rights under this Sublease
without Sublessor's prior written consent or without occurrence of all conditions to such consent,
or if Tenant vacates or abandons the Premises, with or without removal of personalty or fixtures.
29.1.3 if Tenant fails to pay when due any payment of money required of
it under this Sublease and such failure 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 failure is not cured within twenty days after notice from Sublessur
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 Tenant 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
arrangement proceeding is filed by or against Tenant under any federal or state bankruptcy or
insolvency laws and any such proceeding is not vacated or dismissed within sixty days after
Sublessor'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 against
Tenant under any federal or state law and any such 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
arrangement, assignment, composition, or liquidation with or for the benefit 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 prejudice to any of its other remedies for Rent or breach of
covenant. At Sublessor's election, Sublessor may terminate this Sublease at any time after
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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 may 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 terminate this
Sublease or elects not to do so, Sublessor has no duty to and is not required to relet or attempt to
relet 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 the 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, and 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 performing 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 Terminate. If Sublessor elects to terminate this
Sublease and relet, as an obligation surviving such termination Tenant shall pay on demand 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
without limitation Sublessor's costs of recovering possession and reentry, the prorata portion of
any leasing commission paid by Sublessor on account of this Sublease applicable to what would
have been the balance of the Term after Tenant's breach, and Sublessor% costs of reletting.
Present value shall be determined assuming investment of funds at a rate of return equal to the
interest rate on long term United States federal government Treasury notes established at the
auction thereof held immediately before Sublessor's election to terminate.
29.3 Sublessor Does Not Elect To Terminate. If Sublessor does not elect to
terminate this Sublease, Tenant's liability to Sublessor shall include the total Rent and other sums
payable hereunder for the full 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.
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29.4 Sublessor's Right 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
under this Sublease, Sublessor may, at Sublessor's election, take such action as may be required
to cure such default or breach and all costs and expenses incurrad by Sublcssor on account of or
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 by law) 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 Bankruptcy. Ifa petition (in this paragraph 29.5,
"the petition") is filed by or against Tenant under the federal Bankruptcy Code (in this paragraph
29.5, "the Code") the following provisions apply:
29.5.1 Adequate protection for Tenant's obligations under this Sublease
accruing after the filing shall be provided within fifteen days after 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 All amounts payable by Tenant to Sublessor under this Sublease
represent reasonable compensation for Tenant's occupancy of the Premises.
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
abandonment 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
the date the petition is filed regardless of whether Sublessor had given notice of any one or more
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
amended or replaced), prompt cure of the defaults in 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.
297.5.6 For 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 Tanant'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
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Wednesday, Janua~ 15,2003
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 shall 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 wo~h not
less than such amount; and (b) the proposed assignee assume in writing all of Tenant's
obligations under this Sublease.
29.5.7 If Tenant or the trustee intends to assume and/or to assign Tenant's
fights 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
prompt cure, compensation for loss, and assurance of future performance to be provided to
Sublessor. Notice of a proposed assignment shall also state: (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 ora different or 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 by law shall
not be deemed to be or otherwise operate as waiver by it of its right to exercise such right or
remedy or any other right or remedy at any other or future time, whether for the same, a similar,
or a different event or circumstance.
30. HOLDOVER. If with Sublessor's consent Tenant holds over after expiration or
termination of this Sublease, such tenancy shall be a month-to-month tenancy which may be
terminated in accordance with applicable Law and Tenant shall pay to Sublessor the same Rent
and other sums payable to Sublessor as last applicable under this Sublease and shall otherwise be
bound by all applicable provisions of this Sublease consistent with a month-to-month tenancy
including without limitation those which survive expiration or termination.
~1. POSSESSION. 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 Term be in any way extended. However, as Tenant's sole and
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exclusive rights and remedies on account thereof, Tenant shall not be liable for any Rent until
such time as Sublessor tenders 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. NOTICES. 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 single 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 m~y 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 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 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 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.
33. TENANT IMPROVEMENTS AND ACCEPTANCI~.. 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
("Tenant Improvements"). If Sublessor has no such obligation, then Tenant acknowledges it has
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 acknowledges 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 ITS OFFICERS, EMPLOYEES OR AGENTS REGARDING THE CONDITION
OF THE PREMISES, THE PROPERTY, THE PARKING GARAGE, OR THE STATION
OR ANY PART OF ANY OF THE FOREGOING OR THE SUITABILITY 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, finder's fee, or other compensation to any real estate
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Wednesday, January 15, 2003
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 may 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 REPRESENTATIONS. 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 Finanncial Services; and
(c) 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 Premises. 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 OF LANDLORD'S INTEREST. This Sublease shall be
assignable by Sublessor without the consent of Tenant, including but not limited to assignment to
a Master 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
Sublessor'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.
37.1 Tenant Financial Statements. Promptly after Sublessor's request
therefor from time to time, Tenant shall provide to Sublessor copies of Tenant's most recent
financial statements and tax returns.
37.2 Lieht, 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 status of, light, air or view to or from the Premises from any property whatsoever,
including but not limited to the Plaza or any other part of the Station. Any diminution or
shutting off of light, air or view by any structure which may be erected anywhere (including but
not limited 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 performance of such provision in the future. Sublessor shall not be deemed
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Wednesday, January 15, 2003
to have waived its right to strictly enforce any provision of this Sublease or of Sublessor's roles
unless such waiver is expressly contained in a writing signed by Sublessor. Sublessor's
acceptance of Rent or any installment of or on acoount of Rent or any part of Rent fi.om Tenant
or its assignee or other suecossor after any default by Tenant or its assignee or other successor
shall not constitute a waiver of any such default or of any other default.
37.4 Sublessor's Consent. Sublessor's consent given in any one instance shall
not constitute consent to or dispense with the necessity of obtaining Sublessor's consent to any
other or subsequent instance whether of the same or different kind.
37.5 Attorneys Fees And Costs. If Sublessor brings any action arising under
this Sublease against Tenant or if Tenant brings any action arising under this Sublease against
Sublessor, then the other party shall pay the reasonable attorney's fees and costs and all other
expenses incurred by the prevailing party in connection with such action, including, without
being limited to, the costs and fees of consultants, experts, and witnesses. "Action" includes
arbitration, if arbitration is required by law or agreed by the parties, and appeals.
37.6 Joint And Several Liability. If Tenant is a partnership or joint venture or
if Tenant is more than one person, then all the general partners, joint venturers, or persons (in
this paragraph called "such persons") shall be jointly and severally liable for the payment and
performance when due of all Tenant's obligations under this Sublease and the agreement or other
act or omission of any one or more but less than all of such persons is the act of the Tenant and is
binding upon all of such persons accordingly regardless of whether the other such persons
authorized, consented to or ratified such agreement or other act or omission and regardless of
whether the other such persons have specifically refused or withheld such authority or consent.
In addition, notice to or demand on any one or more but less than all of such persons shall be
considered the same as notice to or demand upon all such persons.
37.7 Del)osit A~ainst Costs To Be Incurred. If Sublessor agrees or elects to
do any act at Tenant's cost or expense, then:
37.7.1 Tenant shall be obligated to reimburse to Sublessor all of
Sub!essor's costs and expenses of doing the act within fil~een days after receipt of Sublessor's
invoice therefor; and
37.7.2 At any time and fi.om time to time Sublessor may (a) require
Tenant to deposit with Sublessor in cash the amount estimated by Sublessor to be required to pay
the costs and expenses of such act or, if applicable, to pay the costs of completing such act and/or
(b) Sublessor may require Tenant to provide security for or other assurance of payment when
due, all in form and substance satisfactory to Sublessor in its absolute discretion. If Sublessor
makes such any election under subpart (b) of the preceding sentence, then without liability to
Tenant Sublessor may delay commencement of the act or suspend further performance of the act
until Tenant makes such deposit and/or provides such security or assurance.
37.8 Tenant's Expenses. Where under the provisions .of this Sublease Tenant
is required to perform, or given an election to perform, an act at its expense, Tenant shall pay
31
Wednesday, January 15, 2003
when due all of the costs and expenses of such act. For the purposes of the preceding sentence,
if some part or parts of the total cost and expense of the act is or are due at different times than
others, then Tenant shall pay each part when it is due.
37.9 Assigns. This Sublease shall apply to and be binding upon Sublessor and
Tenant and their respective executors, administrators, successors and assigns.
37.10 Governing Law. This Sublease shall be governed by and construed and
enforced according to the Laws of the State of Washington.
37.11 Memorandum of Sublease. This Sublease shall not be recorded.
However, Sublessor and Tenant shall, promptly after the other's request, execute and record a
menaorandum of Sublease in recordable form that identifies Sublessor and Tenant, the
Commencement Date, the Term (including any options to extend) and a description of the
Premises.
37.12 Submission of Sublease Form Not an Offer. One party's submission of
this Sublease to the other for review shall not constitute an offer to lease the Premises. This
Sublease shall not become effective and binding upon Sublessor and Tenant until it has been
fully signed by both Sublessor and Tenant.
37.13 Authori~. of Parties. Any individual signing this Sublease on behalf of
an entity represents and warrants to the other that such individual has authority to do so and,
upon such individual's execution, that this Sublease shall be binding upon and enforceable
against the party on behalf of whom such individual is signing.
38. ENTIRE AGREEMENT. This Sublease, including the Exhibits and Riders
attached hereto, constitutes the entire agreement between the parties concerning the subject
matter hereof and supercedes and replaces all contemporaneous and prior negotiations,
representations, understandings and agreements related thereto, including but not limited to any
proposals, offers, and letters of intent. Capitalized terms that are used in the Exhibits and Riders
attached hereto have the same meaning as given to such terms in this Sublease. The following
Exhibits and Riders are attached hereto:
38.1 Exhibits:
Exhibit A
Exhibit B
Exhibit C
Exhibit D
Exhibit E
Exhibit F
Floor Plan Outline of the Premises
Legal Description
Site Plan of Auburn Transit Center
Rules and Regulations
Master Sublease
Tenants Improvement Plan
38.2. Riders: (List those attached; if none, so state):
Rent Rider
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Wednesday, Janua~ 15,2003
Option to Extend Rider
Tenant Improvement Rider
BY THEIR SIGNATURES BELOW, OWNER AND TENANT AGREE TO
THE TERMS AND CONDITIONS HEREIN AND CERTIFY THE
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Wednesday, January 15, 2003
PROVISIONS OF THIS CONTRACT WERE
NEGOTIATED.
MUTUALLY
IN WITNESS WHEREOF this Sublease has been executed the date and year first above
written.
TENANT:
PrintName: -~/tT'~elCK ~,
Its "~/q E.5' / J>E'.,.,,/7"
SUBLESSOR:
Print
Its
Att~t:
D~e
City Cl~k
City ARomey
34
Wednesday, Janua~15,2003
STATE OF WASHINGTON )
COUNTY OF )
I certify that I know or have satisfactory evidence that ~7~,~'~ ~./~,-/~.~.
is
the
person who appeared before me and said person ~cknowledged that dJ~
.signed this instrument, on oath stated that ~,i ~ ~/~1~/d a ,y' was authorized to execute the
instrument and acknowledged it as the ~o/'e~t 'den F of P,o-~d ~ ~.,~,,--,~,e.~ to
be the free and voluntary act of such part~, for the uses and purposes mentioned in the instrument.
Printed Name: ~,,,~ a/~
NOTARY PUBLIC in and for the Stat~ of
Washington, residing at F.;de,e~
My Commission expires:
STATE OF WASHINGTON )
COUNTY OF t~M ~-~ )
I certify that I know or have satisfactory evidence that /~e ~/'*r .t5. ZC-~/s is the
person who appeared before me and said pe/rson acknowledged that
signed this instrument, on oath stated that ~ was ~execu~e ~ee
instrument and acknowledged it as the /q~t-r' of ~,~v ,~'/~a~t~t/~t to
be the flee and voluntary act of such party for tti'e uses and purposes menti~oned in the instnunent.
DATED: (~/~ , c;t~Z'a .
$,,,~:"~3'° ~,,~ %.';'.. ~, Printed Name: '~)~?n,-dt/c
~ z: = m .' xC., o): o · NOTARY PUBLIC in atai for the State of
Washingtou, esidin§at
My Commission e pi es:
35