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HomeMy WebLinkAboutAuburn Food Bank-Sublease-Sundowner Shelter DRAFT I SUBLEASE AGREEMENT BETWEEN THE CITY OF AUBURN AND THE AUBURN FOOD BANK Sundowner Shelter SUMMARY This Summary of Basic Sublease Information(the"Summary")is hereby incorporated by reference into and made a part of the attached Sublease. Each reference in the Sublease to any term of this Summary shall have the meaning as set forth in this Summary for such term. In the event of a conflict between the terms of this Summary and the Sublease, the terms of the Sublease shall prevail. Any initially capitalized terms used herein and not otherwise defined herein shall have the meaning as set forth in the Sublease. Subtenant: Auburn Food Bank,a Washington nonprofit corporation Address of Subtenant: 2806-B Auburn Way_N Auburn,WA 98002 Attention:Debbie Christian Tenant/Sublessor: City of Auburn,a municipal corporation. Address of Tenant/Sublessor 25 West Main St. Auburn,WA 98001 Attention: Josh Arndt,Property Analyst Landlord/Owner: Feenix Parkside LLC,a Washington Limited Liability Company Landlord Address: Feenix Parkside LLC c/o Azose Commercial Properties 8451 SE 68th St.Suite 200 Mercer Island,WA 98040 Attention: Bill Sugden Property Manager:Bill Sugden Premises(Article 1): 6.1 Premises: Approximately 1,960 square feet of Principle Rentable Area, and approximately 4,000 square feet of non-exclusive Temporary Rentable Area both located in the Building(as defined below). 6.2 Building: The Premises are located in the"Building" whose address is 2802 — 2826 Auburn Way North, Auburn WA 98002. Term(Article 2): ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 1 of 27 DRAFT I 7.1 Sublease Term: From commencement date through January 31, 2025. 7.2 Commencement Date: By mutual agreement the date of delivery of the Premises to Subtenant, but no later than 30 days from the date of execution of this Sublease by both parties. 7.3 Expiration Date: January 31,2025. 8.0 Base Rent(Article 3): Rent Schedule Paid within 30 Commencement— Days of January 31,2022 $500.00 Commencement Annual Monthly Base Rent Base Rent February 1— $25,200.00 $2,100.00 January 31,2023 February 1,2023— $25,860.00 $2,155.00 January 31,2024 February 1,2024— $26,520.00 $2,210.00 January 31,2025 Security Deposit(Article 4): N/A Reserved Parking The iiiiiilyeserved,non-handicapped parking stalls (Section 22.16): depicted in Exhibit A,at no charge to Subtenant. ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 2 of 27 DRAFT I TERMS THIS SUBLEASE AGREEMENT, hereinafter referred to as the "sublease," is entered into this , 2020, by and between the City of Auburn, a Washington municipal corporation,hereinafter referred to as"City"and/or"Sublessor,"and the Auburn Food Bank,referred to as"Subtenant." In consideration of the mutual promises and covenants contained herein,City of Auburn and the Auburn Food Bank agree as follows: 1. PREMISES. 1.1 Grant of Premises. City hereby subleases to Subtenant and Subtenant subleases from City those certain premises described in Section 6.1 of the Summary(hereinafter referred to as the "Premises"), which Premises are located in the single-story building described in Section 6.2 of the Summary (hereinafter referred to as the `Building"). City and Subtenant hereby confirm and stipulate that the number of square feet of"Rentable Area"contained in the Premises initially leased by Subtenant pursuant to this Sublease have been calculated in accordance with standard rentable area measurement standards used for the Building and is not subject to remeasurement, adjustment or modification. Accordingly, there shall be no modification or adjustment of the Base Rent, or any other dollar amounts set forth in this Sublease which may be based upon any such square footage amounts. The Building and the surface parking areas located adjacent to the Building (the "Parking Areas"), any outside plaza areas, land and other improvements surrounding the Building, the Common Areas,as defined below,and the land upon which any of the foregoing are situated are sometimes collectively referred to herein as the"Real Property." A floor plan showing the size and location of the Premises within the Building is attached hereto as Exhibit A. Subtenant's use and occupancy of the Premises shall include the use, in common with others, of those portions of the Real Property which are designated by the Landlord for use in common by Subtenant and any other tenants of the Building(the"Common Areas"),but excluding therefrom and reserving unto Landlord the exterior faces of all exterior walls, the roof and the right to install, use and maintain where necessary in the Premises all pipes, ductwork, conduits and utility lines through hung ceiling space,partitions,beneath the floor or through other parts of the Premises;provided such installation,use and maintenance do not unreasonably and substantially interfere with the use and occupancy of the Premises by Subtenant or unreasonably diminish Subtenant's access to the Premises. Subtenant has no right or authority regarding what other tenancies are in the Building. Subtenant's right to use the Common Areas is also subject to Landlord's right to close temporarily,make alterations or additions to,or change the location of elements of the Common Areas, provided that, in connection therewith, Landlord shall at all times use commercially reasonable efforts to minimize interference with the conduct of business at the Premises, including providing City with advance notice of 48 hours whenever may reasonably provide such notice. 1.2 Condition of Premises. Subtenant shall occupy the Premises in its current"AS IS" condition without any obligation on City's part to construct or pay for any Subtenant improvement or refurbishment work in the Premises, and Subtenant shall be solely responsible, at its sole cost and expense, for constructing any and all alterations and refurbishment work for the Premises pursuant to, and in accordance with, the provisions of Article 9 and Exhibit C below,however Subtenant shall not erect or construct any permanent alteration or refurbishment in the temporary premises without Sublessor's written approval. 2. TERM. 2.1 Basic Term. The term of this Sublease("Sublease Term")shall be as set forth in Section 7.1 of the Summary and shall commence on the date("Commencement Date")set forth in Section 7.2 of the Summary,and shall terminate on the date(the"Expiration Date")set forth in Section 7.3 of the Summary,unless this Sublease is sooner terminated as hereinafter provided. The term for the temporary premises shall be as stated in Article 4. ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 3 of 27 DRAFT 1 2.3 Renewal. Provided that Subtenant faithfully performs all of the terms and conditions of this Sublease, and City has exercised its option under the Lease to extend the currently effective Lease term, City grants to Subtenant the option to extend the currently effective Sublease term for 5 years three consecutive times. Each of the three extensions must commence consecutively to the prior term without interruption or a delay in the next five year term. Each option to extend the initial Sublease Term for a period of five (5) years (each an "Extension Option")is conditioned upon the City successfully exercising its option to extend the Lease for an additional five-year term. Each option to extend the Sublease term shall be exercisable only by written Exercise Notice(as defined below)delivered by Subtenant to City as provided below. Upon the proper exercise of the applicable Extension Option, and the City obtaining extension of the Lease term,the then-current Sublease Term shall be extended for the applicable five year additional term. 2.3.1 Option Rent. The annual Base Rent payable by Subtenant during the applicable Option Term(the"Option Rent")shall be determined by the parties. If the parties cannot agree upon the Base Rent amounts no later than the date of August 1st prior to the Expiration Date,the option shall terminate and this Sublease shall terminate on the Expiration Date. In no event shall the Option Rent be less than the current annual rent. 2.3.2 Exercise of Option. The applicable Extension Option shall be exercised by Subtenant, if at all, only in the following manner: (i) Subtenant shall deliver written notice to City (the "Interest Notice") not more than fourteen (14) months nor less than nine (9) months prior to the expiration of the then-current Sublease Term. The Notice shall inform the City of the Subtenant's interest in exercising the applicable Extension Option and shall identify the proposed Base Rent amounts for that extended term. The Parties shall then enter into good faith negotiations using commercially reasonable methods to determine the Base Rent amounts. If the Parties cannot come to an agreement by the date of August 1st prior to the expiration of the Sublease, the extension option shall terminate and the Sublease shall conclude upon the Expiration Date. If the parties agree upon Base Rent amounts for the extended term, Subtenant shall deliver written notice(Exercise Notice)to City on or before the date of August 1st prior to the Expiration Date stating the agreed Base Rent and any other agreed terms. The Expiration Notice shall be binding and shall serve as acceptance by Subtenant of City's offer to extend the Sublease at the agreed Base Rent amount, and other agreed terms, subject only to the condition that the Lease Term be extended by Landlord. Subtenant's failure to deliver the notice of interest or the Exercise Notice on or before the applicable delivery dates shall be deemed Subtenant's waiver of its then-current(and any subsequent)Extension Options. Each extension is further conditioned upon the City's Lease being extended by Landlord for the same or longer period of time as the period of the Option Term of the Sublease. 2.3.3. Default; Rights Personal. Notwithstanding anything in the foregoing to the contrary, at City's option,and in addition to all of City's remedies under the Sublease,at law or in equity,the applicable Extension Option shall not be deemed properly exercised if, as of the date Subtenant delivers the applicable Exercise Notice Subtenant has previously been in default under the Sublease beyond all applicable notice and cure periods. In addition, each Extension Option is personal to the Original Subtenant and may not be assigned or exercised,voluntarily or involuntarily,by or to, any person or entity other than the Original Subtenant,and shall only be available to and exercisable by the Original Subtenant when the Original Subtenant is in actual and physical possession of the entire Premises. 2.3.4. Early Termination. Notwithstanding the term as described above, either party shall have the right to terminate this sublease without further penalty by providing the other party with no less than six (6) months prior written notice. Notice of early termination shall be delivered to the other party in a manner consistent with section 9.3 below. Should either party elect to terminate this sublease early, Subtenant shall surrender the Premises in the manner described in section 22.14 below,or as may otherwise be agreed to in writing by both parties. 3. RENT. 3.1 Base Rent. Subtenant agrees to pay City,promptly when due, without notice or demand and without deduction or set-off of any amount for any reason whatsoever, the rental amounts set forth in section 8.0 of the Summary section(the"Base Rent").Beginning February 1, 2022 the Base Rent shall be payable in the monthly installment amounts described. Said ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 4 of 27 DRAFT 1 monthly installments of Base Rent shall be payable in advance on the first (1st) day of each calendar month during the Sublease Term. If the Sublease Term commences or expires on a day other than the first(1st) day of a calendar month, Subtenant shall pay to City on the first(1st) day of the Sublease Term, or on the first (1st) day of the month in which the Sublease Term expires, the prorated portion of the monthly installment of Base Rent payable for such month calculated based upon the actual number of days in such month. All other payments or adjustments required to be made under the terms of this Sublease that require proration on a time basis shall be prorated on the same basis. 3.2 Place of Payment. Base Rent, and all other sums or charges required by this Sublease to be paid by Subtenant to City, which are herein sometimes collectively referred to herein as"Rent,"shall be paid at by mail or delivered in person to City of Auburn,Attn:Finance Department, 25 W Main Auburn, WA 98001 or at such other place as City may from time to time designate, in lawful money of the United States. All Rent paid by Subtenant should reference:ARC SUBLEASE-2806-B. 4.TEMPORARY PREMISES. As an accommodation to Subtenant, City agrees to allow Subtenant to use and occupy on a temporary basis suites 2808-A and 2808-B, as more particularly shown on Exhibit"A", for the period beginning on the Commencement Date and terminating the 30th day after the date of the City's notice to vacate the Temporary Rental Area, or August 31, 2021,whichever date comes first("Temporary Premises Term"). The City reserves the right to in its sole discretion relocate the Temporary Premises at City's by providing 30 days written notice (the "Relocation of Temporary Premises") to the Subtenant. The Relocation of Temporary Premises notice shall depict and describe the area of relocation which shall be substantially the same size as the previous Temporary Premises. The City will not carry or be responsible for any cost or responsibility associated with relocating the Temporary Premises including but not limited to moving of any personal property or belongings. Subtenant's use and occupancy of the Temporary Premises shall be on the same terms and conditions set forth in this Sublease, provided, however,that Subtenant shall (a) have no obligation to pay to City any Base Rent or utilities for the Temporary Premises Area; (b) Subtenant shall not make any alterations, improvements,or refurbishments to the Temporary Rental Area unless approved by the City and then all such work shall be subject to subsection 9.1;(c)Tenant's use of the Temporary Premises shall be limited to shelter purposes. Subtenant may terminate the sublease with respect to the Temporary Premises at any time by giving not less than five (5) days' prior written notice to City. During the Temporary Premises Term, all references in the Sublease to the "Premises" shall be deemed to refer to the Principle Rental Area and the Temporary Rental Area, collectively,unless otherwise noted. In the event that Subtenant occupies any portion of the Temporary Premises following the termination of the Temporary Premises Term, Subtenant shall pay to City the then appropriate Base Rent rate applied to the Temporary Premises,which amounts shall not be prorated and shall be billed on a calendar month basis for the period of any holdover, and (2) the provisions of Section 22.11 (Holding Over)shall apply. 5. USE;COMPLIANCE WITH LAWS;INSURANCE CANCELLATION. 5.1 Use. Subtenant is permitted to use the Premises for a homeless night shelter serving the Auburn and surrounding populations., If requested by the City, Subtenant is also permitted to use the premises for an emergency or inclement weather shelter. With City's approval,Tenant is permitted to use the Premises for other uses consistent with the Master Lease Article 5. Subtenant agrees to not operate an urgent care facility,ambulatory surgery center,or any other facility or enterprise within the Premises that requires a health care facility license under applicable law. 5.1.1 Overnight Safe Parking Program. Subtenant shall have the reasonable right to use, cause or allow the overnight parking of motor vehicles, recreational vehicles and camping trailers (together "Vehicles") for the purpose of overnight sheltering ("Overnight Parking"). Overnight Parking Vehicles must (i) be registered with the Subtenant for any night in which Overnight Parking is permitted, (ii) prominently display a sign, placard or some other identification marking provided by the subtenant in the front windshield or another easily visible ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 5 of 27 DRAFT 1 area to those outside of the vehicle, (iii) park in only those designated areas depicted for "Overnight Parking"by written agreement of the City and Subtenant from time to time,which as of the Commencement Date is depicted in Exhibit A-1,(iv)only be permitted for the purpose of overnight sheltering between the hours of 8:30pm &7:00am, and (v) any rules which the City may provide in its sole discretion which shall determine what a"reasonable right to use,cause or allow" for purposes of this Section 5.1.1, provided however, City will provide reasonable advance notification for implementation for all but exigent and necessary additions or changes to the rules. The City shall have broad discretion to enforce the provisions of this Section 5.1.1 to ensure Subtenant's compliance of this Section to prevent and minimize any violations of this Section adversely affecting Landlord's or City's other tenant and subtenants,including requiring the Subtenant to discontinue operations of the Overnight Safe Parking program. 5.1.2 Medical Dental Provisions; If Subtenant desires to use the Premises for medical, health care, and/or dental services, the Subtenant must, in addition to obtaining the City's approval, comply with section 5.1 of the Master Lease, and in that case Subtenant specifically agrees to be subject to the limitation of liability and insurance requirements stated in that section.. 5.1.1.3 Use Limitations; Liability. Subtenant agrees not to maintain in or around the Premises any activity or instrumentality dangerous to life or limb or to permit any objectionable noise or odor to escape or be emitted from the Premises or to permit anything to be done upon the Premises that would tend to create a nuisance or to disturb any other tenants of the Building. 5.2 ADA&OFAC Compliance. Subtenant,at its sole expense,shall comply with all laws, including, without limitation, the Americans With Disabilities Act, orders, judgments, ordinances, regulations, codes, directives, permits, licenses, covenants and restrictions now or hereafter applicable to the Premises (collectively, "Legal Requirements"). Except as permitted under Subtenant's Permitted Uses, the Premises shall not be used as a place of public accommodation under the Americans With Disabilities Act or similar state statutes or local ordinances or any regulations promulgated thereunder,all as may be amended from time to time. Subtenant shall, at its expense, make any alterations or modifications, within or without the Premises, that are required by legal requirements related to Subtenant's specific use or occupation of the Premises. Except as permitted under Subtenant's Permitted Uses, Subtenant will not use or permit the Premises to be used for any purpose or in any manner that would void Subtenant's, City's, or Landlord's insurance, or increase the insurance risk. If any increase in the cost of any insurance on the Premises,Building or the Real Property is caused by Subtenant's use or occupation of the Premises, or because Subtenant vacates the Premises, then Subtenant shall pay the amount of such increase to the City. Any entrance into or occupation of the Premises by Subtenant prior to the Commencement Date shall be subject to all obligations of Subtenant under this Sublease. Subtenant represents and warrants that Subtenant is currently in compliance with and shall at all times during the Term(including any extension thereof)remain in compliance with the regulations of the Office of Foreign Asset Control ("OFAC") of the Department of the Treasury (including those named on OFAC's Specially Designated and Blocked Persons List) and any statute, executive order (including the September 24, 2001, Executive Order Blocking Property and Prohibiting Transactions with Persons Who Commit, Threaten to Commit,or Support Terrorism),or other governmental action relating thereto. 6. SUBORDINATION TO LEASE; ATTORNMENT; DEFAULT BY CITY UNDER THE SUBLEASE These Sublease is subordinate and subject to the provisions of the Lease,and if the City's Lease shall be terminated by Landlord during its term, Subtenant agrees and grants Landlord the right to(i)cancel this Sublease and repossess the Premises or(ii)require that Subtenant attorn to and recognize Landlord as its sublessor/landlord under the Sublease. If City is in default under the Lease after the expiration of any applicable notice and cure period, Subtenant agrees and grants Landlord the right to direct Subtenant to make all payments under or in connection with this Sublease directly to Landlord(which Landlord shall apply towards City's obligations under the Lease) until such default is cured. Subtenant shall rely on any representation by Landlord that City is in default hereunder,without any need for confirmation thereof by Subtenant. Upon any default by City, Subtenant grants to Landlord the right to enforce all obligations and covenants of Subtenant thereafter to be performed or observed under this Sublease. ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 6 of 27 DRAFT I 7. UTILITIES. 7.1 Utilities.Subtenant has fully investigated the utility services available at the Premises and accepts them in their present condition. Subtenant shall be responsible for those public and private utilities that provide services to the Premises and are separately metered for the Premises, whether the utility was separately metered on the commencement date of the Sublease or the utility becomes separately metered thereafter. Subtenant shall pay all separately metered utility charges directly to the utility provider. Subtenant shall establish the accounts,which will be in subtenant's name, prior to the Sublease Commencement Date, and then proceed to manage its separately metered utility accounts. 7.2 Separate Metering. Notwithstanding the foregoing provisions of this Section 7 to the contrary,Landlord shall have the right to cause some or all of the electricity,water and/or other utilities to be separately metered for the Premises,and Subtenant shall pay for the cost of all such utilities so separately metered,or which are billed directly to Subtenant by City,within ten(10) days after Subtenant's receipt of City's invoice. 7.3 Utility Service Availability; Interruption of Services. Subtenant may operate any HVAC/furnace and lighting serving the Premises during all hours Subtenant conducts business in the Premises. Subtenant agrees that Landlord and City shall not be liable for any damage,loss or expense incurred by Subtenant by reason of any interruption or failure of utilities and services not caused by City or Landlord. Landlord may shut off or discontinue utilities and services when such actions are necessary to make repairs or alterations. No such action shall be construed as an eviction or disturbance of possession by Landlord or City nor relieve Subtenant from paying Rent or performing any of its obligations under this Sublease. Furthermore, Landlord or City shall not be liable under any circumstances for a loss of,or injury to,property or for injury to,or interference with, Subtenant's business, including, without limitation, loss of profits, however occurring,through or in connection with or incidental to a failure to furnish any of the services or utilities as set forth in this Article 7. Except in cases of emergency, City shall provide advance notice of 48 hours to Subtenant whenever City may reasonably provide such notice. 8. MAINTENANCE AND REPAIRS. 8.1 Subtenant's Responsibilities. Subtenant, at its sole expense, shall keep the Premises, including all improvements, fixtures, window coverings, non-structural interior walls, furnishings and systems and interior equipment therein (including, without limitation, (a) plumbing fixtures and equipment such as dishwashers, garbage disposals, and insta-hot dispensers,and(b)all equipment located in the Premises that is utilized to supply electricity and supplemental HVAC to the Premises),floors of the Building on which the Premises are located, in good order, repair and condition at all times during the Temporary Premises and Sublease Terms,and at the end of the Temporary Premises and Sublease Term,respectively,surrender the Premises in good condition,ordinary wear and tear excepted. Subtenant shall also be responsible for all janitorial services and supplies necessary to properly maintain the Premises,and all costs and expenses for repairing, operating and maintaining the heating, ventilating and air conditioning systems supplying service solely to the Subtenants premises, including the costs of all utilities required in the operation thereof and including the cost of equipment replacement used in connection with such repair and maintenance work and all costs and expenses incurred in making alterations or additions thereto. In addition, Subtenant, agrees that it shall at its sole expense and under the supervision of, and subject to the prior approval of the City or Landlord, and within any reasonable period of time specified by the City or Landlord, shall promptly and adequately repair all damage to the Premises and replace or repair all damaged or broken fixtures and appurtenances except that damage which is subject to Section 12. Subtenant grants to City and Landlord the authority to make such repairs and replacements if Subtenant fails to make such repairs when such failure continues for more than five(5)business days after notice from City or Landlord,or to do so without notice in the event of emergency, or where it is reasonable without emergency for City or Landlord to act without notice. For such repairs and replacements,Subtenant shall pay City or Landlord,depending on who made the repairs,the cost thereof,including a percentage of the cost thereof(to be uniformly established for the Building). Such amount shall be sufficient to reimburse City or Landlord for all overhead, general conditions, fees and other costs or expenses arising from City or Landlord's involvement with such repairs and replacements forthwith upon being billed for same. City and Landlord may,but shall not be required to, enter the Premises at all reasonable times to make such repairs, ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 7 of 27 DRAFT I alterations, improvements and additions to the Premises or to the Building or to any equipment located in the Building as City or Landlord shall desire or deem necessary or as Landlord may be required to do by governmental or quasi-governmental authority or court order or decree. Subtenant hereby waives and releases its right to make repairs at City or Landlord's expense under any applicable Laws. City's repairs shall proceed without unreasonable interference with the operation of the business of Subtenant 8.2 Landlord's Responsibilities. Landlord shall undertake the maintenance, repairs and replacements necessary to maintain the Building in a good and clean condition, comparable to other buildings of the same class in the Auburn,Washington area. This maintenance,repair and replacement obligation shall include the roof,foundation,exterior walls(other than plate glass in the Premises) interior structural walls, all structural components and all systems such as mechanical, electrical, and plumbing up to Subtenant's connection points on each such system (expressly excluding systems and components thereof within the Premises or unless any such maintenance or repair is required under Section 8.1 to be performed by Subtenant).If at any time during the term of this Sublease such maintenance, repairs or replacements are required, and Subtenant notifies City, City agrees to notify Landlord of the needed work and, if such repairs, replacements or repairs are not undertaken within fifteen days after notice from City,to exercise its right under the Lease,to undertake such required repairs. 9. SUBTENANT IMPROVEMENTS,ALTERATIONS AND ADDITIONS. 9.1 City and Landlord's Consent Required. Subtenant shall not make any alterations or additions to the Premises without first providing all design drawings associated with the alteration to the City and procuring City's and Landlord's written consent which both shall be given within thirty (30) days from delivery by City to Landlord of the design drawings associated with the alteration. In no event, however, shall Subtenant alter the exterior of the Premises, except as provided in Section 22.17, or make any change or alteration which would impair the structural soundness of the Building. Upon obtaining such consent, Subtenant shall cause the work to be done promptly and in good and workmanlike manner and in accordance with the plans and specifications submitted to,and approved by City and Landlord. Landlord's and City's consent notwithstanding, all work shall be performed in accordance with all applicable Laws and as expressly provided in Exhibit C where such alterations, additions and improvements are defined to be Subtenant Improvements. Subtenant agrees that all work performed and materials supplied shall be performed or supplied only by contractors or volunteers approved by Landlord, and Subtenant grants to Landlord the right to grant such approval conditionally or to withdraw the same at any time. Subtenant agrees that Landlord's approval thereunder shall create no responsibility or liability on the part of Landlord for the completeness,design,sufficiency or compliance with all Laws regarding the alterations. 9.2 Wi-Fi Network. If Subtenant desires to install a wireless intranet,internet or any data or communications network in the Premises (collectively, "Wi-Fi Network"), Subtenant shall use such Wi-Fi Network so as not to cause any interference to other tenants in the Building or Real Property or with any other tenant's or City's communication equipment, and not to damage the Building or Real Property or interfere with the normal operation of the Building or Real Property, and Subtenant hereby agrees to indemnify, defend and hold Landlord and City harmless from and against any and all claims,costs,damages,expenses and liabilities(including attorneys' fees)(collectively,the"Claims")arising out of Subtenant's failure to comply with the provisions of this Section 9.2,except to the extent the Claims are caused by the gross negligence or willful misconduct of Landlord and are not insured or required to be insured by Subtenant under this Sublease. Should any interference occur, Subtenant shall take all necessary steps as soon as reasonably possible,but no later than three(3)calendar days following such occurrence, to correct such interference. If such interference continues after such three (3) day period, Subtenant shall immediately cease operating the Wi-Fi Network until such interference is corrected or remedied to Landlord's satisfaction. Subtenant acknowledges that Landlord has granted and/or may grant telecommunication rights to other tenants and occupants of the Building or Real Property and to telecommunication service providers, and in no event shall Landlord or City be liable to Subtenant for any interference to the Wi-Fi Network. Landlord and City make no representation that the Wi-Fi Network shall be able to receive or transmit communication signals without interference or disturbance. Subtenant shall(i)promptly pay any tax, license or permit fees charged pursuant to any Laws in connection with the installation, maintenance or use of the Wi-Fi Network and comply with all precautions and safeguards ARC Sublease 2806-B Auburn Food Bank/Sund0wn Night Shelter Page 8 of 27 DRAFT 1 recommended by all governmental authorities,(ii)pay for all necessary repairs,replacements to or maintenance of the Wi-Fi Network,and(iii)be responsible for any modifications,additions or repairs to the Building or Real Property,including without limitation,Building or Real Property systems or infrastructure,which are required by reason of the installation, operation or removal of Subtenant's Wi-Fi Network. Should Landlord be required to retain professionals to research any interference issues that may arise and confirm Subtenant's compliance with the terms of this Section 9.2, Subtenant agrees to reimburse Landlord for the costs incurred by Landlord in connection with Landlord's retention of such professionals, the research of such interference issues and confirmation of Subtenant's compliance with the terms of this Section 9.2 within fifteen(15)days after the date City submits to Subtenant Landlord's invoice for such costs. This reimbursement obligation is in addition to, and not in lieu of, any rights or remedies City may have in the event of a breach or default by Subtenant under this Sublease. 9.3 Surrender at End of Sublease Term. Any alterations, additions and improvements made by Subtenant on the Premises, excepting Subtenant's trade fixtures, shall immediately become the property of City and remain upon,and be surrendered with,the Premises at the expiration or earlier termination of either the Temporary Premises or Sublease Term, unless prior to the expiration or earlier termination of the respective Term City provides written notice to Subtenant to remove the same. In such case Subtenant shall remove the same on or before the expiration of the Term, and repair any damage resulting from such removal. Upon the expiration of the Temporary Premises or Sublease Term,or any sooner termination, Subtenant shall remove all of its personal property and any cabling and wiring(including cabling and wiring associated with the Wi-Fi Network)from the corresponding Temporary or Principal Rental Premises and repair all damage resulting from such removal; provided, however, if prior to the expiration or earlier termination of either Term,Landlord provides written notice to Subtenant or to City to surrender the cabling and wiring with the Premises upon the expiration or earlier termination of eitherTerm, Subtenant shall not remove such cabling and wiring. If Subtenant fails to complete any such removal work and/or to repair any damage caused by such removal work pursuant to the foregoing,City may do so and may charge the cost thereof to Subtenant(together with a five percent(5%) supervision/administration fee), and Subtenant shall reimburse City for such costs within thirty(30)days after receipt of an invoice therefor. 9.4 Manner of Construction. As a condition of Landlord's consent to any and all alterations, additions or repairs of the Premises("Alterations"),Landlord or City may impose,and Subtenant agrees to be subject to, such requirements as Landlord and City in each agency's reasonable discretion may deem desirable, including, but not limited to, the requirement that Subtenant utilize for such purposes only contractors,subcontractors,materials,mechanics and materialmen approved by Landlord(in Landlord's sole discretion),the requirement that upon City's request, Subtenant shall, at Subtenant's expense, remove such Alterations upon the expiration or any early termination of the Sublease Term; provided, however, that if Subtenant, as part of its request for approval of alterations,seeks a determination as to whether or not Subtenant shall be required to remove the subject Alteration upon the expiration or earlier termination of this Sublease, then City shall include in its consent (if granted) notice as to whether the subject Alteration shall be required to be removed prior to the expiration or earlier termination of this Sublease, and corresponding repairs made. Subtenant shall construct such Alterations and perform such repairs in a good and workmanlike manner, in conformance with any and all applicable Laws and pursuant to a valid building permit,issued by the city in which the Building is located (or other applicable governmental authority). In the event Subtenant performs any Alterations in the Premises which require or give rise to governmentally required changes to the "Base Building," as that term is defined below, Subtenant agrees that those changes shall be performed by Landlord,but shall be at Subtenant's expense. The"Base Building" shall include the structural portions of the Building,and the systems and equipment located in the internal core of the Building on the floor or floors on which the Premises are located. In performing the work of any such Alterations, Subtenant shall have the work performed in such manner so as not to unreasonably obstruct access to the Building or any portion thereof, by any other tenant of the Building,and so as not to unreasonably obstruct the business of Landlord,City,or other tenants in the Building. In addition to Subtenant's obligations under Article 9 of this Sublease, Subtenant shall deliver to the City a reproducible copy of the "as built" drawings of the Alterations as well as all permits, approvals and other documents issued by any governmental agency in connection with the Alterations. ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 9 of 27 DRAFT 1 9.5 Payment for Work. All costs of any such Alterations or work shall be paid promptly by Subtenant so as to avoid the assertion of any mechanic's or materialman's lien. Subtenant shall discharge,by bonding,payment or other means, any mechanic's lien filed against the Premises, the Building or the Real Property within thirty(30) days after the receipt of notice thereof, and shall promptly inform City and Landlord of any such notice. If the lien is not discharged within said thirty (30) day period, Subtenant agrees that Landlord shall have the right, but not the obligation,to discharge said lien by payment,bonding or otherwise,and the costs and expenses to Landlord of obtaining such discharge shall be paid by Subtenant on demand or as additional rent. 9.6 Subtenant Acknowledgment. Subtenant acknowledges that in performing any improvements or alterations to the Premises, Subtenant is not acting as the agent of Landlord or City and that no labor,professional services,materials,or equipment for the improvement of the Premises or Real Property are being furnished at the insistence of City or Landlord. 9.7 Construction Insurance. In addition to the requirements of Article 10 of this Sublease, and subject to Subtenant's right to self-insure,in the event that Subtenant makes any Alterations, prior to the commencement of such Alterations, Subtenant shall provide City with evidence that Subtenant carries "Builder's All Risk" insurance in an amount approved by Landlord covering the construction of such Alterations, and such other insurance as Landlord or City may reasonably require,it being understood and agreed that all of such Alterations shall be insured by Subtenant pursuant to Article 10 of this Sublease immediately upon completion thereof. In addition, Subtenant's contractors and subcontractors shall be required to carry Commercial General Liability Insurance in an amount approved by Landlord and otherwise in accordance with the requirements of Article 10 of this Sublease. City may, in its discretion, require Subtenant to obtain a lien and completion bond or some alternate form of security satisfactory to City in an amount sufficient to ensure the lien-free completion of such Alterations and naming City and Landlord as a co-obligee. 9.8 Landlord's Property. All Alterations, improvements, fixtures, equipment and/or appurtenances which may be installed or placed in or about the Premises,from time to time,shall be at the sole cost of Subtenant and shall be and become the property of Landlord, except that Subtenant may remove any Alterations, improvements, fixtures and/or equipment which Subtenant can substantiate have not been paid for with any Subtenant improvement allowance funds provided to Subtenant, provided Subtenant repairs any damage to the Premises and Building caused by such removal and returns the affected portion of the Premises to a building standard tenant improved condition as determined by Landlord. City may, subject to the terms of Section 9.3 of this Sublease, by written notice to Subtenant prior to the end of the Sublease Term, or given following any earlier termination of this Sublease, require Subtenant, at Subtenant's expense, to remove any Alterations and/or improvements and/or systems and equipment within the Premises and to repair any damage to the Premises and Building caused by such removal and return the affected portion of the Premises to a building standard tenant improved condition as determined by Landlord. If Subtenant fails to complete such removal and/or to repair any damage caused by the removal of any Alterations and/or improvements and/or systems and equipment in the Premises and return the affected portion of the Premises to a building standard tenant improved condition as reasonably determined by Landlord,City may do so and may charge the cost thereof to Subtenant. 10. INSURANCE. 10.1 Liability and Fire and Casualty Insurance. The Building will be covered by the commercial general liability and casualty insurance required of Landlord by the Lease for the Lease Term including vandalism coverage and malicious mischief, sprinkler leakage, water damage,rental loss,and special extended coverage. 10.2 Subtenant's Compliance with Landlord's Fire and Casualty Insurance. Subtenant shall,at Subtenant's expense,comply with all insurance company requirements pertaining to the use of the Premises. If Subtenant's conduct or use of the Premises causes any increase in the premium for such insurance policies, then Subtenant shall reimburse Landlord for any such increase. Subtenant, at Subtenant's expense, shall comply with all rules, orders, regulations or ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 10 of 27 DRAFT I requirements of the American Insurance Association (formerly the National Board of Fire Underwriters)and with any similar body. 10.3 Subtenant's Insurance. Subtenant shall maintain the following coverages for both the Temporary and Permanent Premises in the following combined amounts. 10.3.1 Commercial General Liability Insurance on an occurrence form covering the insured against claims of bodily injury, personal injury and property damage (including loss of use thereof) arising out of Subtenant's operations, and contractual liabilities (covering the performance by Subtenant of its indemnity agreements) including a Broad Form Commercial General Liability endorsement covering the insuring provisions of this Sublease and the performance by Subtenant of the indemnity agreements set forth in Section 11.1 of this Sublease, and including products and completed operations coverage, for limits of liability on a per location basis of not less than: Bodily Injury and Property Damage Liability: $2,000,000 each occurrence $2,000,000 annual aggregate. Personal Injury Liability:$2,000,000 each occurrence$2,000,000 annual aggregate 0%Insured's participation 10.3.2 Commercial Property Insurance covering (i) all office furniture, business and trade fixtures, office equipment, free-standing cabinet work, movable partitions, merchandise, alterations and improvements and all other items of Subtenant's property on the Premises installed by,for,or at the expense of Subtenant, (ii)the"Subtenant Improvements," as that term is defined in Exhibit C"Subtenant Work Letter",and any other improvements which exist in the Premises as of the Commencement Date (excluding the Base Building) (the "Original Improvements"), and (iii) all other improvements, alterations and additions to the Premises. Such insurance shall be written on an "all risks" of physical loss or damage basis, for the full replacement cost value (subject to reasonable deductible amounts) new without deduction for depreciation of the covered items and in amounts that meet any co-insurance clauses of the policies of insurance and shall include coverage for damage or other loss caused by fire or other peril including,but not limited to,vandalism and malicious mischief,theft,water damage of any type, including sprinkler leakage, bursting or stoppage of pipes, and explosion, and providing business interruption coverage for a period of one year. 10.3.3 Worker's Compensation and Employer's Liability or other similar insurance pursuant to all applicable state and local statutes and regulations. 10.3.4 Extra expense insurance in such amounts as will reimburse Subtenant for direct and indirect loss of earnings attributable to all perils commonly insured against by prudent tenants or attributable to prevention of loss of access to the Premises or to the Building as a result of such perils; provided, however, that Subtenant may self-insure with regard to the risks described in this Section 10.3.4, provided that in all instances such self-insurance shall be deemed to contain all of the terms and conditions applicable to such insurance as required in this Article 10, and Subtenant hereby waives any right it may have against City and Landlord with respect to any damage or loss that would otherwise have been covered by the insurance coverage described in this Section 10.3.4. 10.3.5 Commercial Auto Liability Insurance with a limit of not less than $2,000,000 each accident. Such insurance shall cover liability arising out of owned, hired and nonowned autos. Coverage shall be written on ISO form CA 0001 or a substitute form providing equivalent liability coverage. If necessary, the policy shall be endorsed to provide contractual liability coverage equivalent to that provided in the current edition of the ISO form. Subtenant waives all rights against City and Landlord and their agents,officers,directors and employees for recovery of damages to the extent these damages are covered by the business auto liability insurance obtained by Subtenant. 10.4 Form of Policies. The minimum limits of policies of insurance required of Subtenant under this Sublease shall in no event limit the liability of Subtenant under this Sublease. Such insurance shall (i) name the City as an additional insured (ii) name Landlord, ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 11 of 27 DRAFT 1 Landlord's lenders, and any other party the Landlord so specifies, as an additional insured, including Landlord's managing agent, if any; (iii) specifically cover the liability assumed by Subtenant under this Sublease, including, but not limited to, Subtenant's obligations under Section 11.1 of this Sublease;(iv)be issued by an insurance company having a rating of not less than A-:X in Best's Insurance Guide or which is otherwise acceptable to Landlord and licensed to do business in the State of Washington;(v)be primary and noncontributory insurance as to all claims thereunder and provide that any insurance carried by City and Landlord are excess and non-contributing with any insurance requirement of Subtenant; (vi) be in form and content reasonably acceptable to City;(vii)provide that said insurance shall not be canceled or coverage changed unless thirty(30)days' prior written notice shall have been given to City and Landlord and any mortgagee of Landlord; (viii) contain a cross-liability endorsement or severability of interest clause reasonably acceptable to City; and (iv)with respect to the insurance required in Section 10.3 above,have deductible amounts not exceeding$25,000.00. Subtenant shall deliver said policy or policies or certificates thereof to City on or before the Commencement Date and at least twenty (20) days before the expiration dates thereof. Further, City shall have the right, from time to time, to request copies of policies of Subtenant's insurance required hereunder, which Subtenant shall thereafter provide within ten (10) business days. In the event Subtenant shall fail to procure such insurance, or to deliver such policies or certificates of insurance, City may, at its option,procure such policies for the account of Subtenant, and the cost thereof shall be paid to City within five(5)business days after delivery to Subtenant of bills therefor. 10.5 Subrogation. City and Subtenant intend that their respective property loss risks shall be borne by reasonable insurance carriers to the extent provided for above, and City and Subtenant hereby agree to look solely to,and seek recovery only from,their respective insurance carriers for any loss or damage that may occur to City's personal property, Subtenant's betterments in and about the Premises, and Subtenant's personal property by reason of fire or other casualty,regardless of cause or origin. The parties each hereby waive all rights and claims against each other for such losses,by way of subrogation or otherwise,including their respective employees,officers,directors,subsidiaries,affiliates,agents,representatives,subcontractors,and assigns,and waive all rights of subrogation of their respective insurers,provided such waiver of subrogation shall not affect the right to the insured to recover thereunder. The parties agree that their respective insurance policies are now, or shall be, endorsed such that the waiver of subrogation shall not affect the right of the insured to recover thereunder,so long as no material additional premium is charged therefor. The above waiver of subrogation applies whether or not there are any deductibles or self-insurance and in the absence of insurance. 10.6 Additional Insurance Obligations. Subtenant shall carry and maintain during the entire Sublease Term,at Subtenant's sole cost and expense, increased amounts of the insurance required to be carried by Subtenant pursuant to this Article 10 and such other reasonable types of insurance coverage and in such reasonable amounts covering the Temporary and Permanent Premises and Subtenant's operations therein, as may be reasonably requested by City,but in no event in excess of the amounts and types of insurance then being required by landlords of buildings comparable to and in the vicinity of the Building. 11. INDEMNITY. 11.1 Indemnification and Waiver. Except to the extent caused by the negligence or willful misconduct of City,Subtenant hereby assumes all risk of damage to property or injury to persons in,upon or about the Premises from any cause whatsoever(including,but not limited to, any personal injuries resulting from a slip and fall in,upon or about the Premises)and agrees that City, its partners, sub-partners and their respective officers, agents, servants, employees, and independent contractors (collectively, "City Parties") shall not be liable for, and are hereby released from any responsibility for, any damage either to person or property or resulting from the loss of use thereof, which damage is sustained by Subtenant or by other persons claiming through Subtenant. Subtenant shall indemnify, defend, protect, and hold harmless the City Parties from any and all loss, cost, damage,expense and liability(including,without limitation, court costs and reasonable attorneys' fees)incurred in connection with or arising from any cause in, on or about the Premises (including, but not limited to, a slip and fall), any negligence or willful misconduct of Subtenant or of any person claiming by,through or under Subtenant,or of the contractors, agents, servants, employees, invitees, guests or licensees of Subtenant or any such person,in,on or about the Building or any breach of the terms of this Sublease,either prior to,during,or after the expiration of the Sublease Term,provided that the terms of the foregoing ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 12 of 27 DRAFT I indemnity shall not apply to the negligence or willful misconduct of Landlord or of City. Except to the extent caused by the negligence or willful misconduct of City,should City be named as a defendant in any suit brought against Subtenant in connection with or arising out of Subtenant's occupancy of the Premises, Subtenant shall pay to City its costs and expenses incurred in such suit, including without limitation, its actual professional fees such as reasonable appraisers', accountants' and attorneys' fees. City shall indemnify, defend, protect, and hold harmless Subtenant, its partners, and their respective officers, agents, servants, employees, and independent contractors (collectively,"Subtenant Parties") from any and all loss, cost, damage, expense and liability (including,without limitation,reasonable attorneys' fees) arising from the negligence or willful misconduct of City in,on or about the Building,except to the extent caused by the negligence or willful misconduct of the Subtenant Parties. Notwithstanding anything to the contrary set forth in this Sublease, either party's agreement to indemnify the other party as set forth in this Section 11.1 shall be ineffective to the extent the matters for which such party agreed to indemnify the other party are covered by insurance required to be carried by the non- indemnifying party pursuant to this Sublease. Further, Subtenant's agreement to indemnify City and City's agreement to indemnify Subtenant pursuant to this Section 11.1 are not intended to and shall not relieve any insurance carrier of its obligations under policies required to be carried pursuant to the provisions of this Sublease,to the extent such policies cover,or if carried,would have covered the matters,subject to the parties'respective indemnification obligations;nor shall they supersede any inconsistent agreement of the parties set forth in any other provision of this Sublease. Subtenant hereby agrees that it shall not assert any industrial insurance immunity rights pursuant to Title 51 RCW(as the same may be amended,substituted or replaced) if such assertion would be inconsistent with or otherwise impair City's right to indemnification under this Section 11.1,and,accordingly,hereby waives all such industrial insurance immunity rights. The foregoing waiver of industrial insurance immunity rights was specifically negotiated by City and Subtenant and is solely for the benefit of the City and Subtenant, and their successors and assigns, under the Sublease, and is not intended as a waiver of Subtenant's rights of immunity under such industrial insurance for any other purposes. If and only to the extent RCW 4.24.115 is deemed to apply to all or any part of this Sublease then the indemnities set forth in this Sublease shall be limited such that: (i) Subtenant is not indemnifying City for damages arising out of bodily injury to persons or damage to property caused by, or resulting from, the sole negligence of City or its agents or employees; and (ii) any indemnity against liability for damages arising out of bodily injury to persons or damage to property caused by or resulting from,the concurrent negligence of(A)City or its agents or employees,and(B) Subtenant or its agents or employees,is valid and enforceable only to the extent permitted under RCW 4.24.115. The parties hereby acknowledge that the foregoing waiver was mutually negotiated by the parties.The provisions of this Section 11.1 shall survive the expiration or sooner termination of this Sublease with respect to any claims or liability arising in connection with any event occurring prior to such expiration or termination. City's lals Subten 's Initials 11.2 Indemnification of Other Tenants. Subtenant shall indemnify and save harmless all other tenants of the Building from any loss or damage caused to the Building owing to the leakage or escape of water, gas or other substances from any pipes, machinery or equipment installed by Subtenant within the Building. 11.3 Limitation of Liability. Except in the event of negligence or willful misconduct of City, City shall not be liable for injury or damage which may be sustained by the person, goods,wares,merchandise or property of Subtenant,its employees,invitees or customers,or any other person in or about the Premises caused by,or resulting from,fire,steam,electricity,gas or water,which may leak or flow from or into any part of the Premises,or from breakage,leakage, obstruction or other defects of the pipes,sprinklers,wires,appliances,plumbing,air conditioning or lighting fixtures of the same,whether the said damage or injury results from conditions arising upon the Premises or upon other portions of the Building of which the Premises are a part, or from other sources. In no event shall City be liable for consequential damages. 12. DAMAGE,DESTRUCTION AND BUSINESS INTERRUPTION. 12.1 Repair of Damage to Premises by Landlord. Subtenant shall promptly notify City and Landlord of any damage to the Premises resulting from fire or any other casualty. ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 13 of 27 DRAFT I Landlord's rights and obligations regarding restoring the Premises or any Common Areas are governed by Section 12 of the Sublease. Upon the occurrence of any damage to the Premises, Subtenant shall assign to City all insurance proceeds payable to Subtenant under Subtenant's insurance required under Section 10.3 above pertaining to all subtenant improvements and fixtures in the Premises(but not Subtenant's personal property). Subtenant agrees that Landlord shall repair any damage to the subtenant improvements installed in the Premises and shall return such improvements to their original condition; provided that if the cost of such repair by Landlord exceeds the amount of insurance proceeds received by Landlord from City,the cost of repairs shall be paid by Subtenant to Landlord prior to Landlord's repair of the damage. Notwithstanding anything to the contrary herein,this Sublease shall not create an obligation for Landlord to repair or restore any specialized or dedicated equipment serving Subtenant,such as any cabling, wiring, supplemental utility system or telephone system or Wi-Fi Network. In connection with such repairs and replacements, Subtenant shall, prior to the commencement of construction, submit to City, for Landlord's review and approval, all plans, specifications and working drawings relating thereto, and Landlord shall select the contractors to perform such improvement work. City and Landlord shall not be liable for any inconvenience or annoyance to Subtenant or its visitors, or injury to Subtenant's business resulting in any way from such damage or the repair thereof; provided, however, that if such fire or other casualty shall have damaged the Premises or Common Areas necessary to Subtenant's occupancy and the Premises are unfit for occupancy for the purposes permitted under this Sublease and are not occupied and used by Subtenant as a result thereof, and as long as such damage is not the result of the negligence or willful misconduct of Subtenant or Subtenant's employees, contractors, licensees, or invitees, City shall apply any proportionate abatement of City's Base Rent allowed by Landlord to Subtenant's Base Rent. 12.2 Landlord's Option to Repair. Notwithstanding Section 12.1 above to the contrary, if Landlord elects, according to the Lease, not to rebuild and/or restore the Premises and/or Building and instead terminate the Lease, City may terminate this Sublease by notifying Subtenant in writing of such termination. Such notice will include a termination date giving Subtenant up to sixty(60)days to vacate the Premises,unless Landlord exercises its rights under section 12 of the Lease to terminate immediately in which case this Sublease shall terminate upon the date of the Landlord's notice to the City. Upon any such termination of the Sublease pursuant to this Section, Subtenant shall pay the Base Rent and additional rent, properly apportioned up to such date of termination,and both parties hereto shall thereafter be discharged from all further obligations under this Sublease arising after such termination, except for those obligations which expressly survive the expiration or earlier termination of the Sublease Term. 12.3 Waiver of Statutory Provisions. The provisions of this Sublease, including this Article 12,constitute an express agreement between City and Subtenant with respect to any and all damage to,or destruction of,all or any part of the Premises,the Building or any other portion of the Real Property, and any statute or regulation of the state in which the Building is located, with respect to any rights or obligations concerning damage or destruction in the absence of an express agreement between the parties, and any other statute or regulation, now or hereafter in effect,shall have no application to this Sublease or any damage or destruction to all or any part of the Premises,the Building or the Real Property. 13. SUBTENANT TAXES. 13.1 Personal Property. Subtenant shall pay, prior to delinquency, all taxes, assessments, license fees and public charges levied, assessed or imposed upon,or measured by, the value of Subtenant's business operation, and/or the cost or value of any furniture, fixtures, equipment and other personal property of Subtenant at any time situated upon or in the Premises. Subtenant shall cause all such personal property to be assessed and billed separately from the Building and Real Property. 13.2 Other Taxes for Which Subtenant Is Directly Responsible. In addition, as to all other taxes for which the Subtenant is directly responsible, Subtenant shall reimburse City upon demand for any and all taxes or assessments required to be paid by Landlord, excluding state, local and federal personal or corporate income taxes measured by the net income of Landlord from all sources and estate and inheritance taxes, whether or not customary or within the contemplation of the parties hereto,when: ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 14 of 27 DRAFT 1 13.2.1 Said taxes are measured by,or reasonably attributable to,the cost or value of any leasehold improvements made in or to the Premises by or for Subtenant,to the extent the cost or value of such leasehold improvements exceeds the cost or value of a Building standard build-out as determined by Landlord, regardless of whether title to such improvements shall be vested in Subtenant or Landlord; 13.2.2 Said taxes are assessed upon, or with respect to, the possession, leasing, operation, management, maintenance, alteration, repair, use or occupancy by Subtenant of the Premises or any portion of the Real Property(including the Parking Areas); 13.2.3 Said taxes are assessed upon this transaction or any document to which Subtenant is a party creating or transferring an interest or an estate in the Premises;or 13.2.4 Said assessments are levied or assessed upon the Real Property or any part thereof or upon Landlord and/or by any governmental authority or entity, and relate to the construction, operation,management,use,alteration or repair of mass transit improvements. 13.2.5 To the extent that Subtenant is entitled to any exemptions from any such taxes are passed onto Landlord,the Subtenant's obligations for said taxes shall be offset. 13.3 Increase in Taxes. If at any time during the Sublease Term any of Subtenant's property is assessed as a part of the Premises, or if the assessed value of Landlord's property is increased by the inclusion therein of a value placed on Subtenant's property or other improvements made by Subtenant,Subtenant shall pay to City upon demand,as additional Rent, the amount of any such additional taxes as may be levied against the Building or Real Property by reason thereof. 14. COVENANT AGAINST LIENS. Subtenant shall keep the Building and Premises free from any liens or encumbrances arising out of the work performed,materials furnished or obligations incurred by or on behalf of Subtenant, and shall protect,defend,indemnify and hold City and Landlord harmless from and against any claims, liabilities,judgments or costs (including, without limitation, reasonable attorneys' fees and costs) arising out of same or in connection therewith. Subtenant shall give City notice at least twenty (20) days prior to the commencement of any such work on the Premises (or such additional time as may be necessary under applicable Laws)to afford Landlord the opportunity of posting and recording appropriate notices of non-responsibility. Subtenant shall remove any such lien or encumbrance by bond or otherwise within five(5)business days after notice by City, and if Subtenant shall fail to do so,Landlord may pay the amount necessary to remove such lien or encumbrance,without being responsible for investigating the validity thereof. The amount so paid shall be deemed Additional Rent under this Sublease without limitation as to other remedies available to City under this Sublease. Nothing contained in this Sublease shall authorize Subtenant to do any act which shall subject Landlord's title to the Building or Premises to any liens or encumbrances whether claimed by operation of law or express or implied contract. Any claim to a lien or encumbrance upon the Building or Premises arising in connection with any such work or respecting the Premises not performed by or at the request of Landlord shall be null and void, or at City's option shall attach only against Subtenant's interest in the Premises and shall in all respects be subordinate to Landlord's title to the Building and Premises. 15. ASSIGNMENT AND SUBLETTING. 15.1 Transfers. Subtenant shall not voluntarily or by operation of law, assign, sublet, license, encumber or otherwise transfer all of Subtenant's interest in this Sublease, nor permit any part of the Premises to be used or occupied by any person other than Subtenant, its employees,customers and others having lawful business with Subtenant 16. SUBTENANT'S DEFAULT. 16.1 Definition. The occurrence of any of the following shall constitute a default and breach of this Sublease by Subtenant: ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 15 of 27 DRAFT 1 16.1.1 Any failure by Subtenant to pay when due any Rent or any other monetary sums required to be paid hereunder, which failure continues for ten (10) business days after written notice thereof from City; provided, however, that Subtenant shall not be entitled to more than two (2)notices for monetary defaults during any consecutive twelve(12) month period, and if, after two (2) such notices, any Rent or other sum is not paid when due, a default and breach of this Sublease shall be considered to have occurred without further notice;provided, further,that any such notice given pursuant to this Section 16.1.1 shall be in lieu of, and not in addition to, any statutory notice required under applicable Laws. 16.1.2 Except where a specific time period is otherwise set forth for Subtenant's performance in this Sublease, in which event the failure to perform by Subtenant within such time period shall be a default by Subtenant,any failure by Subtenant to observe and perform any other provisions of this Sublease to be observed or performed by Subtenant within fifteen (15) days after notice thereof has been provided to Subtenant by City, or if performance is not possible within said period, any failure of Subtenant to commence performance within said period and to diligently prosecute such performance to completion. 16.1.3 Intentionally creating or permitting to be created a nuisance which shall not be abated within five(5)days after written notice thereof from City. 16.1.4 Abandonment of all or a substantial portion of the Premises by Subtenant;or 16.1.5 The failure by Subtenant to observe or perform according to the provisions of Article 19 of this Sublease where such failure continues for more than five (5) business days after notice from Landlord. 16.1.6 If Subtenant, or any guarantor of Subtenant's obligations under this Sublease ("Guarantor"): (i)admits in writing that it cannot meet its obligations as they become due;(ii)is declared insolvent according to any Law; (iii) makes or attempts to make an assignment of Subtenant's or Guarantor's property is made for the benefit of creditors;(iv)a receiver or trustee is appointed for Subtenant or Guarantor or its property;(v)the interest of Subtenant or Guarantor under this Sublease is levied on under execution or other legal process; (vi)any petition is filed by or against Subtenant or Guarantor to declare Subtenant bankrupt or to delay,reduce or modify Subtenant's debts or obligations;or(vii)any petition is filed or other action taken to reorganize or modify Subtenant's or Guarantor's capital structure,if Subtenant or Guarantor is a corporation or other entity; any such levy, execution, legal process or petition filed against Subtenant or Guarantor shall not constitute a breach of this Sublease provided Subtenant or Guarantor shall vigorously contest the same by appropriate proceedings and shall remove or vacate the same within sixty(60)days from the date of its creation,service or filing. 16.1.7 The taking of this Sublease or Subtenant's interest therein under writ of execution. The notice periods provided herein are in lieu of, and not in addition to, any notice periods provided by Law. 16.2 Interest on Unpaid Sums. If any Rent,or any other monetary sum required to be paid thereunder by Subtenant to City, is not paid when due, such sum shall accrue interest from the date due until received at the rate(the"Interest Rate")which is the lower of(i)the highest rate permitted by applicable Law or(ii)eighteen percent(18%)per annum. 16.3 Remedies. In the event of any such default or breach by Subtenant, City may at any time thereafter pursue, without limiting City in the exercise of any other right or remedy which City may have at law or in equity (all of which remedies shall be distinct, separate and cumulative), any one or more of the following remedies, each and all of which shall be cumulative and nonexclusive,without any notice or demand whatsoever: 16.3.1 Terminate this Sublease, in which event Subtenant shall immediately surrender the Premises to City, and if Subtenant fails to do so, City may, without prejudice to any other remedy which it may have for possession or arrearages in rent,enter upon and take possession of the Premises and expel or remove Subtenant and any other person who may be occupying the ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 16 of 27 DRAFT 1 Premises or any part thereof, without being liable for prosecution or any claim or damages therefor;and City may recover from Subtenant the following: 16.3.1.4 The worth at the time of award of the unpaid rent which has been earned at the time of such termination;plus 16.3.1.5 The worth at the time of award of the amount by which the unpaid rent which would have been earned after termination until the time of award exceeds the amount of such rental loss that Subtenant proves could have been reasonably avoided;plus 16.3.1.6 The worth at the time of award of the amount by which the unpaid rent for the balance of the Sublease Term after the time of award exceeds the amount of such rental loss that Subtenant proves could have been reasonably avoided;plus 16.3.1.7 Any other amount necessary to compensate City for all the detriment proximately caused by Subtenant's failure to perform its obligations under this Sublease or which in the ordinary course of things would be likely to result therefrom,specifically including, but not limited to, brokerage commissions and advertising expenses incurred, expenses of remodeling the Premises or any portion thereof for a new Subtenant,whether for the same or a different use,and any special concessions made to obtain a new Subtenant;and 16.3.1.8 At City's election, such other amounts in addition to or in lieu of the foregoing as may be permitted from time to time by applicable Law. The term"rent"as used in this Section 16.3 shall be deemed to be and to mean all sums of every nature required to be paid by Subtenant pursuant to the terms of this Sublease,whether to City or to others. As used in Sections 16.3.1.1 and 16.3.1.2, above, the "worth at the time of award" shall be computed by allowing interest at the rate set forth in Section 16.2 of this Sublease,but in no case greater than the maximum amount of such interest permitted by Law. As used in Section 16.3.1.3 above,the"worth at the time of award" shall be computed by discounting such amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of award plus one percent(1%). Upon termination of the Sublease by City and surrender of Premises by Subtenant,City shall use commercially reasonable efforts to re-let the Premises and otherwise mitigate its damages by the Subtenant under this Sublease. 16.3.2 If City does not elect to terminate this Sublease on account of any default by Subtenant, Landlord may continue the Sublease in effect (whether or not Subtenant has abandoned or vacated the Premises) and, from time to time,without terminating this Sublease, enforce all of its rights and remedies under this Sublease,including the right to recover all rent as it becomes due. 16.3.3 City may re-enter and attempt to relet the Premises without terminating this Sublease and remove all persons and property from the Premises (which property may be removed and stored in a public warehouse or elsewhere at the sole cost and risk of, and for the account of, Subtenant),all without service of notice or resort to legal process and without being deemed guilty of trespass, or any liability of Landlord for any loss or damage which may be occasioned thereby. If City, without terminating this Sublease, either(i) elects to re-enter the Premises and attempts to relet the Premises, (ii) takes possession of the Premises pursuant to legal proceedings, or(iii) takes possession of the Premises pursuant to any notice provided by Law,then City may,from time to time,make such alterations and repairs as may be necessary in order to relet the Premises or any part thereof for such term or terms (which may be for a term extending beyond the Sublease Term) and at such rent and other terms as Landlord in its reasonable discretion deems advisable. Upon such reletting,all rent received by City from such reletting shall be applied, first to the payment of any indebtedness of Subtenant to City (other than for any rent due hereunder); second,to the payment of any costs and expenses of obtaining possession and any such reletting, including the expense of alterations and repairs, brokerage fees and attorneys' fees; third, to the payment of any rent due and unpaid hereunder. If such rents and any other amounts received from such reletting during any month are less than that to be paid during that month by Subtenant,then Subtenant shall immediately pay such deficiency to City. No such re-entry or taking of possession of the Premises by City shall be construed as an ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 17 of 27 DRAFT 1 election by City to terminate this Sublease unless a notice of such intention is given by City to Subtenant. Notwithstanding any such reletting without termination, City may at any time thereafter elect to terminate this Sublease for such previous default. Should City at any time terminate this Sublease for any default,in addition to any other remedies it may have,City shall be entitled to the remedy set forth in Section 16.3 above, and may recover all damages it may incur by reason of such default,including the cost of recovering the Premises,reimbursement of any brokerage fees incurred by City in connection with this Sublease and all rent(accrued or to accrue during the Sublease Term) which, at City's election, shall be accelerated and be due in full on demand. 16.3.4 City shall at all times have the rights and remedies (which shall be cumulative with each other and cumulative and in addition to those rights and remedies available under Sections 16.3.1, 16.3.2 and 16.3.3, above, or any Law or other provision of this Sublease), without prior demand or notice except as required by applicable Law,to seek any declaratory, injunctive or other equitable relief,and specifically enforce this Sublease,or restrain or enjoin a violation or breach of any provision hereof. 16.4 Subleases of Subtenant. If City elects to terminate this Sublease on account of any default by Subtenant,as set forth in this Article 16,City shall have the right to terminate any and all subleases, licenses,concessions or other consensual arrangements for possession entered into by Subtenant and affecting the Premises or may, in City's sole discretion, succeed to Subtenant's interest in such subleases, licenses, concessions or arrangements. In the event of City's election to succeed to Subtenant's interest in any such subleases,licenses,concessions or arrangements, Subtenant shall, as of the date of notice by City of such election,have no further right to or interest in the rent or other consideration receivable thereunder. 16.5 Efforts to Relet. No re-entry or repossession, repairs, maintenance, changes, alterations and additions,reletting,or any other action or omission by City shall be construed as an election by City to terminate this Sublease or Subtenant's right to possession,or to accept a surrender of the Premises, nor shall same operate to release Subtenant in whole or in part from any of Subtenant's obligations hereunder,unless express written notice of such intention is sent by City to Subtenant. Subtenant hereby irrevocably waives any right otherwise available under any Law to redeem or reinstate this Sublease. 16.6 Late Charges. Subtenant hereby acknowledges late payment by Subtenant to City of Rent and other sums due thereunder will cause City to incur costs not contemplated by this Sublease,the exact amount of which will be extremely difficult to ascertain. Such costs include, but are not limited to,processing and accounting charges. Accordingly,if any Rent or any other sum due from Subtenant shall not be received by City or City's designee within ten (10) days after the date such sum is due, Subtenant shall pay to City a late charge equal to twelve percent (12%)of such overdue amount. The parties hereby agree such late charge represents a fair and reasonable estimate of the cost City will incur by reason of late payment by Subtenant. Acceptance of such late charge by City shall in no event constitute a waiver of Subtenant's default with respect to such overdue amount nor prevent City from exercising any of the other rights and remedies granted hereunder. 17. CITY'S DEFAULT. City shall in no event be charged with default in the performance of any of its obligations hereunder unless and until City shall have failed to perform such obligations within thirty(30) days (or within such additional time as is reasonably required to correct any such default) after notice to City by Subtenant properly specifying wherein City has failed to perform any such obligations. Any notice of default given City shall be null and void unless simultaneous notice has been given to Landlord. Neither City, nor any of City's officers, members or partners nor their respective officers,agents,directors or employees shall have any personal liability therefor, and Subtenant hereby expressly waives and releases such personal liability on behalf of itself and all persons claiming by,through or under Subtenant. 18. CONDEMNATION. If the whole or any material part of the Premises or Building shall be taken by power of eminent domain or condemned by any competent authority for any public or quasi-public use or purpose, ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 18 of 27 DRAFT 1 or if any adjacent property or street shall be so taken or condemned,or reconfigured or vacated by such authority in such manner as to require the use,reconstruction or remodeling of any part of the Premises or Building,or if Landlord shall grant a deed or other instrument in lieu of such taking by eminent domain or condemnation,City shall have the option to terminate this Sublease effective as of the date possession is required to be surrendered to the authority. If more than twenty-five percent(25%)of the rentable square feet of the Premises is taken,or if access to the Premises is substantially impaired, in each case for a period in excess of one hundred eighty (180) days, Subtenant shall have the option to terminate this Sublease effective as of the date possession is required to be surrendered to the authority. Subtenant shall not because of such taking assert any claim against City or Landlord or the authority for any compensation because of such taking. The Landlord shall be entitled to the entire award or payment in connection therewith, except that Subtenant shall have the right to file any separate claim available to Subtenant for any taking of Subtenant's personal property and fixtures belonging to Subtenant and removable by Subtenant upon expiration of the Sublease Term pursuant to the terms of this Sublease, and for moving expenses,so long as such claims do not diminish the award available to Landlord,its ground lessor with respect to the Building or Real Property or its mortgagee,and such claim is payable separately to Subtenant. All Rent shall be apportioned as of the date of such termination. If any part of the Premises shall be taken, and this Sublease shall not be so terminated,the Rent shall be proportionately abated. Notwithstanding anything to the contrary contained in this Article 18, in the event of a temporary taking of all or any portion of the Premises for a period of one hundred and eighty(180) days or less,then this Sublease shall not terminate but the Base Rent and additional Rent shall be abated for the period of such taking in proportion to the ratio that the amount of rentable square feet of the Premises taken bears to the total rentable square feet of the Premises. Landlord shall be entitled to receive the entire award made in connection with any such temporary taking. 19. SUBORDINATION. 19.1 Subordination. This Sublease, at Landlord's option, shall be subject and subordinate to the liens of any mortgages or deeds of trust and to any ground leases now or hereafter placed on or against the land or improvements,or either thereof,of which the Premises are a part, or on or against Landlord's interest or estate therein, without the necessity of the execution and delivery of any further instruments on the part of Subtenant to effectuate such subordination. If any mortgagee or trustee or ground lessor shall elect to have this Sublease prior to the lien of its mortgage or deed of trust or ground lease and shall give written notice thereof to Subtenant,this Sublease shall be deemed prior to such mortgage or deed of trust or ground lease, whether this Sublease is dated prior or subsequent to the date of said mortgage or deed of trust or ground lease. 19.2 Subordination Agreements. Subtenant covenants and agrees to execute and deliver within ten (10) business days of request by City, without charge therefor, such further instruments evidencing such subordination of this Sublease to the lien of any such ground leases, mortgages or deeds of trust as may be required by Landlord. Subtenant covenants and agrees in the event any proceedings are brought for the foreclosure of any such mortgage,or if any ground lease is terminated, to attorn, without any deductions or set-offs whatsoever, to the purchaser upon any such foreclosure sale, or to the lessor of such ground lease, as the case may be, if so requested to do so by such purchaser or lessor,and to recognize such purchaser or lessor as the Landlord under this Sublease. Subtenant waives the provisions of any current or future statute, rule or law which may give or purport to give Subtenant any right or election to terminate or otherwise adversely affect this Sublease and the obligations of the Subtenant hereunder in the event of any foreclosure proceeding or sale. 20. QUIET ENJOYMENT. City agrees Subtenant,upon paying Rent and other monetary sums due under this Sublease and performing the covenants and conditions of this Sublease,may quietly have,hold and enjoy the Premises during the Sublease Term hereof,subject,however,to the terms,covenants,conditions and agreements herein referring to subordination and condemnation. 21. DELAYS. ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 19 of 27 DRAFT I Whenever City shall be delayed or restricted due to no fault of City in the performance of any obligation of City herein(including any obligation with respect to the provision of any service or utility or the performance of work or repairs) by reason of City's inability to obtain materials, services or labor required for such performance or by reason of any Law, or by reason of any other cause beyond City's control,City shall be entitled to extend the time for such performance by a time equal to the extent of the delay or restriction, and subtenant shall not be entitled to compensation for any inconvenience,nuisance or discomfort occasioned thereby. 22. GENERAL PROVISIONS. 22.1 Estoppel Certificates. Subtenant shall, at any time, upon not less than five (5) business days written notice from City, execute, acknowledge and deliver to Landlord a statement in writing(i) certifying this Sublease is unmodified and in full force and effect(or if modified, stating the nature of the modification) and the date to which the Rent is paid in advance, (ii) acknowledging there are not, to Subtenant's knowledge, any uncured defaults on the part of Landlord thereunder or specifying such default if any exist, and(iii)containing such other information reasonably requested by Landlord or Landlord's mortgagee or Landlord's prospective mortgagees or buyers. If Subtenant fails to execute and deliver such statement within five (5) business days, it shall be deemed conclusively to have acknowledged the accuracy of the matter set forth in Landlord's statement. 22.2 Intentionally Deleted. 22.3 Captions. Article and paragraph captions are for convenience only and are not a part of this Sublease and shall not be used for interpretation or construction of this Sublease. 22.4 Time of Essence. Time is of the essence hereof. 22.5 Severability. The invalidity of any provision of this Sublease,as determined by a court of competent jurisdiction,shall in no way affect the validity of any other provision hereof. 22.6 Entire Agreement. This Sublease, along with any exhibits or attachments hereto, constitutes the entire agreement between the parties relative to the Premises and there are no oral agreements or representations between the parties with respect to the subject matter hereof. This Sublease supersedes and cancels all prior agreements and understandings with respect to the subject matter hereof. This Sublease may be modified only in writing, signed by the parties in interest at the time of the modification. 22.7 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 22.8 Waiver. No provision of this Sublease shall be deemed waived by either party hereto unless expressly waived in a writing signed thereby. The waiver by either party hereto of any breach of any term, covenant or condition herein contained shall not be deemed to be a waiver of any subsequent breach of same or any other term, covenant or condition herein contained. The subsequent acceptance of Rent hereunder by City shall not be deemed to be a waiver of any preceding breach by Subtenant of any term, covenant or condition of this Sublease,other than the failure of Subtenant to pay the particular Rent so accepted,regardless of City's knowledge of such preceding breach at the time of acceptance of such Rent. No acceptance of a lesser amount than the Rent herein stipulated shall be deemed a waiver of City's right to receive the full amount due, nor shall any endorsement or statement on any check or payment or any letter accompanying such check or payment be deemed an accord and satisfaction, and City may accept such check or payment without prejudice to City's right to recover the full amount due. No receipt of monies by City after the termination of this Sublease shall in any way alter the length of the Sublease Term or of Subtenant's right of possession hereunder. Subtenant's payment of any Rent shall not constitute a waiver by Subtenant of any breach or default by City under this Sublease nor shall City's payment of monies due Subtenant constitute a waiver by City of any breach or default by Subtenant under this Sublease. 22.9 Force Majeure. Any delay in the performance of any obligation under this Sublease shall be excused, if and so long as the performance of the obligation is prevented, ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 20 of 27 DRAFT 1 delayed or otherwise hindered by any act not within the control of a party such as fire, cyber/ransomware attack, earthquake, flood, explosion, actions of the elements,war,riots, mob violence,strikes,lockouts,and orders of military authority;provided,however,the foregoing act or event, other than a cyber/ransomware attack, shall not excuse Subtenant from the timely payment of Base Rent,Additional Rent or other sums due hereunder,when due. 22.10 Binding Effect;Choice of Law. Subject to any provisions restricting assigning or subletting by Subtenant and subject to the provisions for the transfer of City's interest, this Sublease shall bind the parties,their successors and assigns. This Sublease shall be governed by the laws of the State of Washington. 22.11 Holding Over. If Subtenant remains in possession of all or any part of the Premises after the expiration of the Sublease Term hereof,with or without the consent of City, such tenancy shall be from month-to-month only, and not a renewal hereof or an extension for any further term, on the same terms and conditions as provided herein, except only as to the Sublease Term; provided, however, during such period as a Subtenant from month-to-month, Subtenant shall pay Base Rent at double the rate payable for the month immediately preceding the date of termination of this Sublease and, in addition, Subtenant shall reimburse City for all damages sustained by it by reason of Subtenant's occupying the Premises past the termination date.If Subtenant's occupation of the Premises continues for more than sixty(60)days past the termination date, City shall also be entitled to consequential as well as direct damages from the termination date. 22.12 Entry by Landlord and City. Landlord and City and their agents shall have the right to enter the Premises at all reasonable times(without notice in the event of emergency and if no emergency and it is reasonable 24 hours'notice)for the purpose of examining or inspecting the same and any other services to be provided by Landlord thereunder, to show the same to prospective purchasers of the Building and make such alterations, repairs, improvements or additions to the Premises or to the Building of which they are a part as Landlord and City may deem necessary or desirable. Subtenant shall permit Landlord and City to show the Premises to prospective tenants. If Subtenant shall not be personally present to open and permit an entry into the Premises at any time when such entry by Landlord or City is necessary or permitted, Landlord or City may enter by means of master key without liability to Subtenant except for any failure to exercise due care for Subtenant's property, and without affecting this Sublease. If, during the last month of the Sublease Term hereof, Subtenant shall have removed substantially all of its property from the Premises, City may immediately enter and alter, renovate and redecorate the Premises without elimination or abatement of rent or incurring liability to Subtenant for any compensation. 22.13 Corporate Authority. If Subtenant is a corporation, limited liability company or partnership, each individual executing this Sublease on behalf of Subtenant represents and warrants he/she is duly authorized to execute and deliver this Sublease on behalf of Subtenant in accordance with the by-laws, duly adopted Board of Directors resolution or other governing documents of said entity, and this Sublease is binding upon Subtenant in accordance with its terms. Subtenant hereby confirms that it is not in violation of any executive order or Law which prohibits terrorism or transactions with suspected or confirmed terrorists or terrorist entities or with persons or organizations that are associated with, or that provide any form of support to, terrorists. Subtenant further hereby confirms that Subtenant shall comply throughout the Sublease Term with all applicable Laws governing transactions or business dealings with any suspected or confirmed terrorists or terrorist entities,as identified from time to time by the U.S. Treasury Department's Office of Foreign Assets Control or any other applicable governmental entity. 22.14 Notices. Any notice required or permitted to be given hereunder may be served by a party or its attorney and must be in writing and shall be deemed to be given(i)when hand delivered, or(ii) one (1) business day after pickup by a reputable overnight express service, or (iii) when transmitted by electronic mail (provided however that any facsimile or email transmission initiated after 5:00 PM on a weekday,or at any time on a Saturday,Sunday or legal holiday, shall be deemed delivered on the following business day),but only if confirmation of the receipt of same is noted upon transmission of same by e-mail records and a counterpart of such notice is also delivered pursuant to one of the two manners specified in subsections(i) or ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 21 of 27 DRAFT 1 (ii) of this Section 22.14, in any case addressed to the parties at their respective addresses set forth below: City: City of Auburn 25 West Main St. Auburn WA 98001 Attention:Josh Arndt,Real Property Analyst Email/Phone:Jarndt@Auburnwa.gov/253.288.4325 Subtenant: The Auburn Food Bank PO Box 464 Auburn,WA 98071 Attn:Debbie Christian,Executive Director Email/Phone:Debbiec@theauburnfoodbank.org/253.833.8925 Landlord: FEENIX PARKSIDE LLC c/o AZOSE COMMERCIAL PROPERTIES 8451 SE 68th St.,Suite 200 Mercer Island,WA,98040 Attention: Bill Sugden Email:BSugden@Azose.com/425.974.4224 22.15 Real Estate Broker. Subtenant represents and insofar as Subtenant knows, no broker negotiated or participated in the negotiations of this Sublease,or submitted or showed the Premises, or is entitled to any commission in connection herewith. Subtenant agrees to indemnify and defend City against and hold City harmless from any and all Claims with respect to any leasing commission or equivalent compensation alleged to be owing on account of Subtenant's dealings with any real estate broker or agent other than the Broker(s)in connection with this Sublease. 22.16 Parking. Subtenant and Subtenants employees, officers, customers and guests shall have the right of parking,without obligation to pay parking charges,in any non-designated Surface Parking Areas located on the Real Property during Subtenants business hours with the exception of those Overnight Parking spaces depicted in Exhibit A-1. Subtenant shall not be obligated to pay any parking charges for the use thereof. Subtenant's continued right to use the parking spaces is conditioned upon Subtenant abiding by the Parking Rules and Regulations which are in effect on the date hereof,as set forth in the attached Exhibit B and all modifications and additions thereto which are prescribed from time to time for the orderly operation and use of the Parking Areas by Landlord and upon Subtenant's cooperation in seeing that Subtenant's employees and visitors also comply with the Parking Rules and Regulations (and all such modifications and additions thereto, as the case may be). City or Landlord specifically reserves the right to change the size, configuration, design, layout, location and all other aspects of the Parking Areas,and Subtenant acknowledges and agrees that City or Landlord may do so,without incurring any liability to Subtenant and without any abatement of Rent under this Sublease,and as well from time to time, close-off or restrict access to some or all of the Parking Areas or relocate Subtenant's parking spaces to other Parking Areas within a reasonable distance of the Building so long as total parking spaces available to Subtenant are not decreased. 22.17 Sign Rights. Subtenant shall be allocated one slot in the pylon sign listing Subtenant. Subtenant shall also be entitled to install a façade sign above its Suite and window signs no larger than 24" x 36" in the glazed frontage areas. All such permitted signage must comply with all applicable Law, meet City design standards for the Auburn Resource Center signage, and use Building standard materials and lettering. City shall not be required to notify Subtenant of whether it consents to any sign until it(a)has received detailed,to-scale drawings thereof specifying design, material composition, color scheme, and method of installation, and (b)has had a reasonable opportunity to review them,but no more than 15 business days. Upon surrender or vacation of the Premises, Subtenant shall have removed all signs and repair,paint, and/or replace the building facade surface to which its signs are attached to its preexisting ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 22 of 27 DRAFT I condition. Subtenant shall obtain all applicable governmental permits and approvals for sign and exterior treatments,pay for the cost of the initial installation of such permitted signage,as well as the cost of any changes thereto. No such façade or window signage shall be permitted for the Temporary Premises. 22.18 Joint and Several. If there is more than one Subtenant, the obligations imposed upon Subtenant under this Sublease shall be joint and several. 22.19 Intentionally Deleted. 22.20 Jurisdiction— Construction of Sublease. The laws of the State of Washington shall govern the validity, performance and enforcement of this Sublease. King County, Washington shall be the venue of any action arising out of this Sublease. Although the printed provisions of this Sublease were prepared and drawn by City, this Sublease shall not be construed either for or against City or Subtenant, but its construction shall be at all times in accord with the general tenor of the language so as to reach a fair and equitable result. 22.21 Waiver Of Jury Trial And Damages. SUBTENANT AND CITY EACH HEREBY EXPRESSLY, IRREVOCABLY, FULLY AND FOREVER RELEASES, WAIVES AND RELINQUISHES ANY AND ALL RIGHT TO TRIAL BY JURY. THE PARTIES EXPRESSLY, IRREVOCABLY, FULLY AND FOREVER RELEASES, WAIVES AND RELINQUISHES ANY AND ALL RIGHT TO RECEIVE PUNITIVE, EXEMPLARY AND CONSEQUENTIAL DAMAGES(EXCEPT AS PROVIDED IN SECTION 22.11)FROM THE OTHER (OR ANY PAST, PRESENT OR FUTURE BOARD MEMBER, TRUSTEE, DIRECTOR, OFFICER, EMPLOYEE, AGENT, REPRESENTATIVE, OR ADVISOR OF EITHER) IN ANY CLAIM, DEMAND, ACTION, SUIT, PROCEEDING OR CAUSE OF ACTION IN WHICH THE SUBTENANT AND CITY ARE PARTIES,WHICH IN ANY WAY (DIRECTLY OR INDIRECTLY) ARISES OUT OF, RESULTS FROM OR RELATES TO ANY OF THE FOLLOWING, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING AND WHETHER BASED ON CONTRACT OR TORT OR ANY OTHER LEGAL BASIS: THIS SUBLEASE; ANY PAST, PRESENT OR FUTURE ACT, OMISSION, CONDUCT OR ACTIVITY WITH RESPECT TO THIS SUBLEASE; ANY TRANSACTION, EVENT OR OCCURRENCE CONTEMPLATED BY THIS SUBLEASE; THE PERFORMANCE OF ANY OBLIGATION OR THE EXERCISE OF ANY RIGHT UNDER THIS SUBLEASE;OR THE ENFORCEMENT OF THIS SUBLEASE. SUBTENANT AND CITY EACH AGREES THAT THIS SUBLEASE CONSTITUTES WRITTEN CONSENT THAT TRIAL BY JURY SHALL BE WAIVED IN ANY SUCH CLAIM, DEMAND, ACTION, SUIT, PROCEEDING OR OTHER CAUSE OF ACTION AND AGREES THAT SUBTENANT AND CITY EACH SHALL HAVE THE RIGHT AT ANY TIME TO FILE THIS SUBLEASE WITH THE CLERK OR JUDGE OF ANY COURT IN WHICH ANY SUCH CLAIM, DEMAND, ACTION, SUIT, PROCEEDING OR OTHER CAUSE OF ACTION MAY BE PENDING AS STATUTORY WRITTEN CONSENT TO WAIVER OF TRIAL BY JURY IN ACCORDANCE WITH RULES AND PROCEDURES OF ANY COURT. 22.22 Security Measures. Subtenant hereby acknowledges that City and Landlord shall have no obligation whatsoever to provide guard service or other security measures for the benefit of the Premises or the Building,and City and Landlord shall have no liability to Subtenant due to its failure to provide such services. Subtenant assumes all responsibility for the protection of Subtenant, its agents, employees, contractors and invitees and the property of Subtenant and of Subtenant's agents,employees,contractors and invitees from acts of third parties.Nothing herein contained shall prevent City or Landlord, at either of those entity's sole option, from implementing security measures for the Building any part thereof,in which event Subtenant shall participate in such security measures and the cost thereof shall be included within the definition of Operating Expenses,and Landlord and City shall have no liability to Subtenant and its agents, employees, contractors and invitees arising out of City's or Landlord's negligent provision of security measures. 22.23 Easements. Subtenant agrees that this agreement is subject to Landlord granted easements, rights and dedications that Landlord deems necessary or desirable, so long as such easements, rights, dedications,maps and restrictions do not unreasonably interfere with the use of the Premises by Subtenant. Subtenant shall sign any of the aforementioned documents within ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 23 of 27 DRAFT 1 ten (10) days after City's request, and Subtenant's failure to do so shall constitute a material default by Subtenant. The obstruction of Subtenant's view, air, or light by any structure erected in the vicinity of the Building,whether by City,Landlord or third parties, shall in no way affect this Sublease or impose any liability upon City or Landlord. 22.24 Transportation Management. Subtenant shall fully comply at its sole expense with all present or future programs implemented or required by any governmental or quasi- governmental entity or Landlord to manage parking,transportation,air pollution,or traffic in and around the Building in the area in which the Building is located. 22.25 Auctions. Subtenant shall not conduct, nor permit to be conducted, either voluntarily or involuntarily,any auction upon the Premises,Common Areas or the Property.The holding of any auction in violation of this Paragraph shall constitute a material default hereunder. 22.26 Attorney's Fees. If either party shall retain an attorney for the purpose of collecting any amount due from the other party,or for the purpose of enforcing a default in any other terms or provision of this Sublease, the party shall pay the fees of such attorney for the attorney's services regardless of the fact that no legal proceeding or action may have been filed or commenced. 22.27 Exhibits Incorporated.The following exhibits are hereby incorporated by reference to this Sublease: Exhibit A—Sublease Premises Exhibit A-1—Overnight Parking Exhibit B—Rules and Regulations Exhibit C—Work Letter [SIGNATURES AND ACKNOWLEDGEMENTS ON FOLLOWING PAGES] ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 24 of 27 DRAFT 1 IN WITNESS WHEREOF, Landlord and Tenant have executed this Sublease as of the day and year first above written. CITY/TENANT: CITY OF AUBURN, a Washington municipal corporation, By: )(' O . Name: Nan ackus Its: Mayor SUBTENANT: AUBURN FOOD BANK,a Washington non-profit corporation By: e: � / Its. k4AJh ' ***If Tenant is a CORPORATION, the authorized officers must sign on behalf of the corporation and indicate the capacity in which they are signing. This Sublease must be executed by the president or vice president and the secretary or assistant secretary,unless the bylaws or a resolution of the board of directors shall otherwise provide, in which event, the bylaws or a certified copy of the resolution,as the case may be,must be attached to this Sublease. ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 25 of 27 DRAFT 1 City Notary STATE OF WASHINGTON ) )ss. COUNTY OF KING ) 91 On this_ day ofbec.e.mle( , 200 before me,the undersigned, a Notary Public in and fora State of Washington, duly commissioned and sworn personally appeared Nari �Cug ,known to me to be the l�b r- of the CITY�F AUBURN,WASHINGTON,the corporation that executed the ford going instrument, and acknowledged the said instrument to be the free and voluntary act and deed of said corporation, for the purposes therein mentioned,and on oath stated that he/she was authorized to execute said instrument. I certify that I know or have satisfactory evidence that the person appearing before me and making this acknowledgment is the person whose true signature appears on this document. WITNESS my hand and official seal hereto affixed the day and year in the certificate above written. G,„4„, Print Name: ( err i Q k NOTARY PUBLIC in and for the Sate of Washington,residing atLC• My commission expires �\-�l Oaa ` N NN\w\ 11 ` \gLA`` 1 I/ _ lilt 1lilt 1j�h F 203917 u'_ 9j` l,,f7. g3l•`'74O 0R WAS`�';�•``� h‘\\\\\ ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 26 of 27 DRAFT 1 Food Bank Notary STATE OF WASHINGTON ) )ss. COUNTY OF KING ) On thisZ:U"i// day of , 202D before me,the undersigned, a Notary Public in and for the State of Washington, duly commissioned and s orn personally appeared t j,i e, ,known to me to be th VQ D infekrof the AUBURN FOOD BANK, the nonprofit that executed the foregoing instrument, and acknowledged the said instrument to be the free and voluntary act and deed of said corporation,for the purposes therein mentioned, and on oath stated that he/she was authorized to execute said instrument. I certify that I know or have satisfactory evidence that the person appearing before me and making this acknowledgment is the person whose true signature appears on this document. WITNESS my hand and official seal hereto affixed the day and year in the certificate above written. (semi- Print Name: 6e-r- ' c4 o e NOTARY PUBLIC in and,fpr the State of Washington,residing at lC� My commission expires I I-1 -ZO'ZZ ���'ACKhccl��4 `........stgtt ' oN F,4,o.540 so41. 40 17 5.0 2039 §- z A ��� = - % N�qbB dry` ,,'llllOF vvri.5 ARC Sublease 2806-B Auburn Food Bank/Sundown Night Shelter Page 27 of 27 DRAFT 1 EXHIBIT A SUNDOWN NIGHT SHELTER SUBLEASE PREMISES AUBURN RESOURCE CE'`.CER II Tein$rary Preiutsesfor t Snridown Subleased. an4/or Ray Of Hope 1 � a • 8 • /-_ M'� 2815 2816 2812&14 2810 no,. 280311._ 2608-A 2846.B 2896•A ri rvi 2892 Sundown Night Shelter Permanent Premises(2806-B) Temporary Premises(2808-A&B) ll Subleased(2802&2806-A) ARC Sublease 2806-B EXHIBIT A Page 1 of 1 DRAFT 1 EXHIBIT A-1 OVERNIGHT PARKING V s r k I Tor Otieruigg14t Parkaa� <.('on I7C)feetive. 83Qpm-i:OUam.. sn dif - � I s i !' 1 y t t •-•,..... s `"1 � " r s 1, 3 d 1d's �- Auburi Resor 6e Gent r i. Get 1 _ t3 4 1.f) � Z s i 1 ri+-4? t 3 s 3 I r t .,. v r .m t 4 .i _ . [' j{ I 77 ij: 1-.) d i.......... 'i 3 3.P . AUFAN01 WAY.1`3014T f 3' trViria ate. Fb,C i3;2 CF Atikil ' ARC Sublease 2806-B EXHIBIT A-1 Page 1 of 1 VI EXHIBIT B RULES AND REGULATIONS Except to the extent that these Rules and Regulations conflict with any express provision of the Lease, Tenant shall faithfully observe and comply with the following Rules and Regulations and the Parking Rules and Regulations, except to the extent the rule is inconsistent with or unreasonably interferes with the exercise of Tenant's rights under this Lease. Landlord shall not be responsible to Tenant for the nonperformance of any of said Rules and Regulations and/or the Parking Rules and Regulations by or otherwise with respect to the acts or omissions of any other tenants or occupants of the Building and/or the Real Property. 1. Tenant shall not place any lock(s) on any door, or install any security system (including, without limitation, card key systems, alarms or security cameras), in the Premises without Landlord's prior written consent,which consent shall not be unreasonably withheld,and Landlord shall have the right to retain at all times and to use keys or other access codes or devices to all locks and/or security systems within and to the Premises. A reasonable number of keys to the locks on the entry doors of the Premises shall be furnished by Landlord to Tenant at Tenant's cost, and Tenant shall not make any duplicate keys. All keys shall be returned to Landlord at the expiration or earlier termination of the Lease. Further, if and to the extent Tenant re-keys,re-programs or otherwise changes any locks in or for the Premises,all such locks and key systems must be consistent with the master lock and key system at the Building, all at Tenant's sole cost and expense. 2. Landlord shall have the right to control and operate the public portions of the Building and Real Property,the public facilities,the heating and air conditioning,and any other facilities furnished for the common use of tenants, in such manner as is customary for comparable buildings in the vicinity of the Building. 3. No signs,advertisements or notices shall be painted or affixed to windows,doors or other parts of the Building,except those of such color,size,style and in such places as are first approved in writing by Landlord. Landlord shall have the right to remove any signs, advertisements, and notices not approved in writing by Landlord without notice to and at the expense of Tenant. 4. Tenant shall not disturb (by use of any television, radio or musical instrument, making loud or disruptive noises, creating offensive odors or otherwise), solicit,or canvass any occupant of the Building and/or the Real Property and shall cooperate with Landlord or Landlord's agents to prevent same. 5. The toilet rooms, urinals, wash bowls and other apparatus shall not be used for any purpose other than that for which they were constructed, and no foreign substance of any kind whatsoever shall be thrown therein. The expense of any breakage, stoppage or damage resulting from the violation of this rule shall be borne by the tenant who,or whose employees or invitees,shall have caused it. 6. Tenant shall not overload the floor of the Premises. Tenant shall not mark,drive nails or screws, or drill into the partitions, woodwork or plaster or in any way deface the Premises or any part thereof without Landlord's consent first had and obtained; provided, however, Landlord's prior consent shall not be required with respect to Tenant's placement of pictures and other normal office wall hangings on the interior walls of the Premises (but at the end of the Lease Term,Tenant shall repair any holes and other damage to the Premises resulting therefrom). 7. Except for vending machines intended for the sole use of Tenant's employees and invitees, no vending machine or machines of any description other than fractional horsepower office machines shall be installed,maintained or operated upon the Premises without the written consent of Landlord. Tenant shall not install,operate or maintain in the Premises or in any other area of the Building, electrical equipment that would overload the electrical system beyond its capacity for proper,efficient and safe operation as determined solely by Landlord. ARC Sublease 2806-B EXHIBIT B Page 1 of 5 vi 8. Tenant shall not use any method of heating or air conditioning other than that which may be supplied by Landlord,without the prior written consent of Landlord. Tenant shall not furnish cooling or heating to the Premises,including,without limitation,the use of electronic or gas heating devices, portable coolers (such as "move n cools") or space heaters, without Landlord's prior written consent, and any such approval will be for devices that meet federal, state and local code. 9. No inflammable,explosive or dangerous fluids or substances shall be used or kept by Tenant in the Premises,Building and/or about the Real Property,except for those substances as are typically found in similar premises used for general office purposes and are being used by Tenant in a safe manner and in accordance with all applicable Laws, rules and regulations. Tenant shall not, without Landlord's prior written consent, use, store, install, spill, remove, release or dispose of,within or about the Premises or any other portion of the Real Property,any asbestos-containing materials or any solid, liquid or gaseous material now or subsequently considered toxic or hazardous under the provisions of 42 U.S.C. Section 9601 et seq. or any other applicable environmental Laws which may now or later be in effect. Tenant shall comply with all Laws pertaining to and governing the use of these materials by Tenant,and shall remain solely liable for the costs of abatement and removal. 10. Tenant shall not use,keep or permit to be used or kept,any foul or noxious gas or substance in or on the Premises, or permit or allow the Premises to be occupied or used in a manner offensive or objectionable to Landlord or other occupants of the Building and/or the Real Property by reason of noise, odors, or vibrations, or interfere in any way with other tenants or those having business therewith. 11. Tenant shall not bring into or keep within the Real Property,the Building or the Premises any animals(except those assisting handicapped persons),birds or fish tanks.Vehicles are only permitted in the Parking Areas and are not permitted in the Building. 12. Except as permitted in connection with Tenant's Permitted Uses in Section 5.1 of the Lease,Tenant shall not use or occupy the Premises in any manner or for any purpose which might injure the reputation or impair the present or future value of the Premises, the Building and/or the Real Property. Except as permitted in connection with Tenant's Permitted Uses in Section 5.1 of the Lease,Tenant shall not use,or permit any part of the Premises to be used,for lodging,sleeping or for any illegal purpose. 13. Except as reasonably necessary in connection with Tenant's Permitted Uses in Section 5.1 of the Lease, no cooking shall be done or permitted by Tenant on the Premises,nor shall the Premises be used for the storage of merchandise or for any improper,objectionable or immoral purposes. Notwithstanding the foregoing, Underwriters' laboratory-approved equipment and microwave ovens may be used in the Premises for heating food and brewing coffee,tea,hot chocolate and similar beverages,provided that such use is in accordance with all applicable Laws and does not cause odors which are objectionable to Landlord and other tenants. 14. Landlord will approve where and how communication wires and other cabling are to be introduced to the Premises. No boring or cutting for wires shall be allowed without the consent of Landlord. The location of telephone, call boxes and other office equipment and/or systems affixed to the Premises shall be subject to the approval of Landlord. Tenant shall not use more than its proportionate share of telephone lines and other telecommunication facilities available to service the Building. 15. Landlord reserves the right to exclude or expel from the Building and/or the Real Property any person who, in the judgment of Landlord, is intoxicated or under the influence of liquor or drugs, or who shall in any manner do any act in violation of any of these Rules and Regulations or cause harm to Building occupants and/or property. 16. All contractors, contractor's representatives and installation technicians performing work in the Building or at the Real Property shall be licensed and bonded and subject to Landlord's prior approval, which approval shall not be unreasonably withheld, and shall be required to comply with Landlord's standard rules, regulations, policies and procedures, which may be revised from time to time. ARC Sublease 2806-B EXHIBIT B Page 2 of 5 VI 17. Tenant at all times shall maintain the entire Premises in a neat and clean manner, free of debris. Tenant shall not place items,including,without limitation,any boxes, files,trash receptacles or loose cabling or wiring, in or near any window to the Premises which would be visible anywhere from the exterior of the Premises. 18. All of Tenant's recyclables,trash and garbage shall be placed in the disposal bins or receptacles designated for the Building in the ordinary and customary manner in the city in which the Real Property is located without violation of any law or ordinance governing such disposal. 19. Tenant shall comply with all safety,fire protection and evacuation procedures and regulations established by Landlord or any governmental agency. 20. Tenant shall assume any and all responsibility for protecting the Premises from theft,robbery and pilferage,which includes keeping doors locked and other means of entry to the Premises closed, when the Premises are not occupied, or when the entry to the Premises is not manned by Tenant on a regular basis. 21. No awnings or other projection shall be attached to the outside walls of the Building without the prior written consent of Landlord. No curtains, blinds, shades or screens shall be attached to or hung in,or used in connection with,any window or door of the Premises without the prior written consent of Landlord. The sashes, sash doors, skylights, windows, and doors that reflect or admit light and air into the halls,passageways or other public places in the Building shall not be covered or obstructed by Tenant, nor shall any bottles, parcels or other articles be placed on the windowsills. All electrical ceiling fixtures hung in offices or spaces along the perimeter of the Building must be of a quality,type and design approved by Landlord. 22. Tenant shall comply with any non-smoking ordinance adopted by any applicable governmental authority. Neither Tenant nor its agents,employees,contractors,guests or invitees shall smoke or permit smoking in the Premises and/or the Common Areas,unless the Common Areas have been declared a designated smoking area by Landlord, nor shall the above parties allow smoke from the Premises to emanate into the Common Areas or any other part of the Building. Landlord shall have the right to designate the Building(including the Premises) as a non-smoking building. 23. Tenant shall not take any action which would violate Landlord's labor contracts or which would cause a work stoppage,picketing, labor disruption or dispute, or interfere with Landlord's or any other tenant's or occupant's business or with the rights and privileges of any person lawfully in the Building("Labor Disruption"). Tenant shall take the actions necessary to resolve the Labor Disruption, and shall have pickets removed and, at the request of Landlord, immediately terminate any work in the Premises that gave rise to the Labor Disruption, until Landlord gives its written consent for the work to resume, and Tenant shall have no claim for damages against Landlord or any of its trustees, members, principals, beneficiaries, partners, officers,directors,employees,mortgagees,or agents in connection therewith. 24. No tents, shacks,temporary or permanent structures of any kind shall be allowed on the Real Property. No personal belongings may be left unattended in any portion of the Real Property. 25. Landlord shall have the right to prohibit the use of the name of the Building or Real Property or any other publicity by Tenant that in Landlord's sole opinion may impair the reputation of the Building or Real Property or the desirability thereof. Upon written notice from Landlord,Tenant shall refrain from and discontinue such publicity immediately. 26. Landlord shall have the right to designate and approve standard window coverings for the Premises and to establish rules to assure that the Building presents a uniform exterior appearance. Tenant shall ensure, to the extent reasonably practicable, that window coverings are closed on windows in the Premises while they are exposed to the direct rays of the sun. 27. Tenant shall at all times cooperate with Landlord in preserving an appropriate image for the Building in Landlord's judgment. ARC Sublease 2806-B EXHIBIT B Page 3 of 5 VI PARKING RULES AND REGULATIONS 1. Vehicles must be parked entirely within the stall lines painted on the floor,only as expressly permitted, with small cars parked in areas reserved for small cars and Commercial Vehicles in areas reserved for Commercial Vehicles. 2. All directional signs and arrows must be observed. 3. The speed limit shall be 5 miles per hour. 4. Parking spaces reserved for handicapped persons must be used only by vehicles properly designated. 5. Parking is prohibited in all areas not expressly designated for parking, including without limitation: (a) areas not striped for parking; (b) aisles; (c) where"no parking"signs are posted; (d) ramps;and (e) loading zones. 6. Every parker is required to park and lock his/her own car. 7. Landlord shall not be liable for loss of or damage to any vehicle or any contents of such vehicle or accessories to any such vehicle, or any property left in any of the Surface Parking Areas, resulting from fire, theft, vandalism, accident, conduct of other users of the Surface Parking Areas and other persons, or any other casualty or cause. Further, Tenant understands and agrees that: (i) Landlord will not be obligated to provide any traffic control, security protection for the Surface Parking Areas; (ii) Tenant uses the Surface Parking Areas at its own risk; and(iii)Landlord will not be liable for personal injury or death,or theft,loss of or damage to property. Tenant indemnifies and agrees to hold Landlord and its agents and employees harmless from and against any and all claims,demands,and actions arising out of the use of the Surface Parking Areas by Tenant and its employees and agents,whether brought by any of such persons or any other person. 8. Washing,waxing,cleaning or servicing of any vehicle by the customer and/or its agents is prohibited. 9. Tenant agrees to acquaint all persons to whom Tenant assigns a parking space with these Parking Rules and Regulations. 10. Tenant will ensure that any vehicle parked in any of the parking spaces will be kept in proper repair and will not leak excessive amounts of oil or grease or any amount of gasoline. If any of the parking spaces are at any time used(i)for any purpose other than parking as provided above, (ii) in any way or manner not permitted by Section 22.16 and reasonably objectionable to Landlord,or(iii)by Tenant after default by Tenant under the Lease,Landlord, in addition to any other rights otherwise available to Landlord, may consider such default an event of default under the Lease. 11. Tenant's right to use the Parking Areas will be in common with other tenants of the Real Property and with other parties permitted by Landlord to use the Parking Areas. Landlord reserves the right to assign and reassign, from time to time,particular parking spaces for use by persons selected by Landlord, provided that Tenant's rights under the Lease are preserved. Landlord will not be liable to Tenant for any unavailability of Tenant's designated spaces, if any,nor will any unavailability entitle Tenant to any refund,deduction, or allowance. Tenant will not park in any numbered space or any space designated as: RESERVED, HANDICAPPED,VISITORS ONLY,or LIMITED TIME PARKING(or similar designation). 12. If the Parking Areas are damaged or destroyed,or if the use of the Parking Areas is limited or prohibited by any governmental authority, or the use or operation of the Parking Areas is limited or prevented by strikes or other labor difficulties or other causes beyond Landlord's reasonable control, Tenant's inability to use the parking spaces will not subject Landlord(and/or the Parking Operator,as the case may be)to any liability to Tenant and will not ARC Sublease 2806-B EXHIBIT B Page 4 of 5 VI relieve Tenant of any of its obligations under the Lease and the Lease will remain in full force and effect. Tenant will pay to Landlord upon demand,and Tenant indemnifies Landlord against, any and all loss or damage to the Parking Areas, or any equipment, fixtures, or signs used in connection with the Parking Areas and any adjoining buildings or structures caused by Tenant or any of its employees and agents. 13. Tenant has no right to assign or sublicense any of its rights in the parking passes, except as part of a permitted assignment or sublease of the Lease;however,Tenant may allocate the parking passes among its employees. Tenant shall be responsible for the observance of all of the Rules and Regulations and Parking Rules and Regulations in this Exhibit B by Tenant's employees, agents, clients, customers, invitees and guests. Landlord may waive any one or more of the Rules and Regulations and/or Parking Rules and Regulations for the benefit of any particular tenant or tenants, but no such waiver by Landlord shall be construed as a waiver of such Rules and Regulations and/or Parking Rules and Regulations in favor of any other tenant or tenants, nor prevent Landlord from thereafter enforcing any such Rules or Regulations and/or Parking Rules and Regulations against any or all tenants of the Building and/or the Real Property. Landlord reserves the right at any time to change or rescind any one or more of these Rules and Regulations and/or the Parking Rules and Regulations, or to make such other and further reasonable Rules and Regulations and/or Parking Rules and Regulations as in Landlord's judgment may from time to time be necessary for the management, safety, care and cleanliness of the Premises, Building and Real Property, and for the preservation of good order therein, as well as for the convenience of other occupants and tenants therein. Tenant shall be deemed to have read these Rules and Regulations and Parking Rules and Regulations and to have agreed to abide by them as a condition of its occupancy of the Premises. ARC Sublease 2806-B EXHIBIT B Page 5 of 5 vi EXHIBIT C WORK LETTER TO STANDARD SUBLEASE This Work Letter to Standard Sublease ("Work Letter") shall set forth the terms and conditions relating to the construction of the Premises, alterations and additions under Section 9. All references in this Work Letter to the "Sublease" shall mean the relevant portions of the Sublease to which this Work Letter is attached. SECTION 1 GENERAL CONSTRUCTION OF THE PREMISES Subtenant shall accept (i) the base, shell, and core of the Premises and of the floor of the Building on which the Premises is located (collectively, the "Base, Shell, and Core") and (ii)the Premises in their current"AS IS" condition existing as of the date of the Sublease and the Commencement Date. City shall not be obligated to make or pay for any alterations or improvements to the Premises, the Building or Real Property envisioned to be made under Section 9 of the Sublease. City agrees to provide Subtenant with copies or access to copies of existing Building plans and architectural & construction drawings it possesses which include the Premises within five (5) business days of execution of the Sublease. SECTION 2 SUBTENANT IMPROVEMENTS 2.1 Subtenant shall pay for the costs of the design, permitting and construction of Subtenant's improvements which are permanently affixed to the Premises (collectively, the "Subtenant Improvements") throughout the Sublease Term. The remaining Sections of this Work Letter shall apply equally each time any Significant Subtenant Improvements are made to the Premises as defined below in Section 2.1.1 of this Work Letter. 2.1.1 For any alteration or improvement which the Subtenant desires to make to the Premises, Subtenant shall provide to City a written statement describing the proposed alterations/improvements in a manner that clearly defines the type, size, scope, work, and location. Within 14 days of receipt, City shall notify Subtenant whether such proposed alteration or improvement requires strict compliance with the remaining Sections of this Work Letter ("Significant Subtenant Improvement"). For any proposed alteration or improvement which the City does not consider to be a Significant Subtenant Improvement, the City shall submit the improvements to Landlord for determination whether Subtenant will need to engage design professionals to prepare construction drawings for review, whether submission of a Space Plan is required for Landlord's review, whether it must comply with any of Sections 4.2.4, 4.3 and 4.4 of this Work ARC Sublease 2806-B EXHIBIT C Page 1 of 7 vi Letter. Within 5 days of receiving Landlord's response, City shall inform Subtenant of the determination as part of City's written consent as required under Section 9.1 of the Sublease. SECTION 3 CONSTRUCTION DRAWINGS 3.1 Selection of Architect/Construction Drawings. Subtenant shall retain an architect/space planner (the "Architect") to prepare the Construction Drawings and Final Space Plan, subject to City's and Landlord's reasonable approval. Subtenant shall retain the engineering consultants (the "Engineers"), also subject to Landlord's reasonable approval,to prepare all plans and engineering working drawings relating to the structural, mechanical, electrical, plumbing, HVAC, life safety, and sprinkler work in the Premises, which work is not part of the Base, Shell, and Core work. The plans and drawings to be prepared by Architect and the Engineers hereunder shall be known collectively as the "Construction Drawings." All Construction Drawings shall be subject to Landlord's and City's approval. Subtenant and Architect shall verify, in the field, the dimensions and conditions as shown on the relevant portions of the base building plans, and Subtenant and Architect shall be solely responsible for the same, and City and Landlord shall have no responsibility in connection therewith. City's and Landlord's review of the Construction Drawings as set forth in this Section 3, shall be for its sole purpose and shall not imply Landlord's or City's review of the same, or obligate Landlord or City to review the same, for quality, design, Code compliance or other like matters. Accordingly, notwithstanding that any Construction Drawings are reviewed by Landlord's or City's space planner, architect, engineers and consultants, and notwithstanding any advice or assistance which may be rendered to Subtenant by those individuals or other representatives of City or Landlord. City and Landlord shall have no liability whatsoever in connection therewith and shall not be responsible for any omissions or errors contained in the Construction Drawings, and Subtenant's waiver and indemnity set forth in Article 11 of the Sublease shall specifically apply to the Construction Drawings. 3.2 Final Space Plan. Subtenant shall supply City and Landlord with four (4) copies signed by Subtenant of its final space plan for the portion of the Premises being improved or altered before any architectural working drawings or engineering drawings have been commenced. The final space plan (the "Final Space Plan") shall include a layout and designation of all offices, rooms and other partitioning,their intended use, and equipment to be contained therein. City and/or Landlord may request clarification or more specific drawings for special use items not included in the Final Space Plan. City shall advise Subtenant within ten (10) business days after its receipt of the Final Space Plan for the affected portion of the Premises if the same is unsatisfactory to City or Landlord or incomplete in any respect. If Subtenant is so advised, Subtenant shall promptly cause the Final Space Plan to be revised to correct any deficiencies or other matters Landlord and/or City may reasonably require. ARC Sublease 2806-B EXHIBIT C Page 2 of 7 VI 3.3 Final Working Drawings. After the Final Space Plan has been approved by Landlord and City, Subtenant shall supply the Engineers with a complete listing of standard and non-standard equipment and specifications, including, without limitation, Btu calculations, electrical requirements and special electrical receptacle requirements for the portion of the Premises being improved or altered, to enable the Engineers and the Architect to complete the "Final Working Drawings" (as that term is defined below) in the manner as set forth below. Upon the approval of the Final Space Plan by Landlord and City, Subtenant shall promptly cause the Architect and the Engineers to complete the architectural and engineering drawings for the portion of the Premises being improved or altered, and Architect shall compile a fully coordinated set of architectural, structural, mechanical, electrical and plumbing working drawings in a form which is complete to allow subcontractors to bid on the work and to obtain all applicable permits (collectively, the "Final Working Drawings") and shall submit the same to City and Landlord for City and Landlord's approval. Subtenant shall supply City and Landlord with four (4) copies signed by Subtenant of such Final Working Drawings. City shall advise Subtenant within ten (10) business days after Landlord's receipt of the Final Working Drawings for the Premises if the same is unsatisfactory or incomplete in any respect. If Subtenant is so advised, Subtenant shall immediately revise the Final Working Drawings in accordance with such review and any disapproval of City and/or Landlord in connection therewith. 3.4 Approved Working Drawings. The Final Working Drawings shall be approved by City and Landlord (the "Approved Working Drawings") prior to the commencement of construction of the Premises by Subtenant. After approval by City and Landlord of the Final Working Drawings, Subtenant may submit the same to the appropriate governmental authorities for all applicable building permits. Subtenant hereby agrees that neither City, Landlord nor Landlord's consultants shall be responsible for obtaining any building permit or certificate of occupancy for the Premises and that obtaining the same shall be Subtenant's responsibility. No changes, modifications or alterations in the Approved Working Drawings may be made without the prior written consent of City and Landlord,which consent may not be unreasonably withheld. SECTION 4 CONSTRUCTION OF THE SUBTENANT IMPROVEMENTS 4.1 Subtenant's Selection of Contractors. 4.1.1 The Contractor. Subtenant shall select and retain a general contractor to construct the Subtenant Improvements, subject to City and Landlord's reasonable approval, which contractor shall thereafter be the"Contractor"hereunder. 4.1.2 Subtenant's Agents. All subcontractors, laborers, materialmen, and suppliers used by Subtenant (such subcontractors, laborers, materialmen, and suppliers, and the Contractor to be known collectively as "Subtenant's Agents") must be approved in writing by City and Landlord, which approval shall not be unreasonably withheld or delayed. So long as a Subtenant's Agent, Subtenant's Transferee, or Subtenant is ARC Sublease 2806-B EXHIBIT C Page 3 of 7 Vl responsible for the activities of any volunteers of any Service Provider (as defined under the Sublease), City and Landlord's consent is not additionally required for such services. 4.2 Construction of Subtenant Improvements by Subtenant's Agents. 4.2.1 Subtenant's Agents. 4.2.1.1 Landlord's General Conditions for Subtenant's Agents and Subtenant Improvement Work. Subtenant's and Subtenant's Agent's construction of the Subtenant Improvements shall be constructed in strict accordance with the Approved Working Drawings. 4.2.1.2 Indemnity. Subtenant's indemnity of City as set forth in Article 11 of the Sublease shall also apply with respect to any and all costs, losses, damages, injuries and liabilities related in any way to any act or omission of Subtenant or Subtenant's Agents, or anyone directly or indirectly employed by any of them, or in connection with Subtenant's non-payment of any amount arising out of the Subtenant Improvements and/or Subtenant's disapproval of all or any portion of any request for payment. Such indemnity by Subtenant, as set forth in Article 11 of the Sublease, shall also apply with respect to any and all costs, losses, damages, injuries and liabilities related in any way to City's performance of any ministerial acts reasonably necessary(i) to permit Subtenant to complete the Subtenant Improvements, and (ii) to enable Subtenant to obtain any building permit or certificate of occupancy for the Premises. 4.2.1.3 Insurance Requirements. 4.2.1.3.1 General Coverages. All of Subtenant's Agents shall carry workers' compensation insurance covering all of their respective employees, and shall also carry public liability insurance, including property damage, all with limits, in form and with companies as are required to be carried by Subtenant as set forth in Article 10 of the Sublease. 4.2.1.3.2 Special Coverages. Subtenant shall carry "Builder's All Risk" insurance in an amount equal to the full replacement cost of the improvements being constructed by Subtenant, and such other insurance as Landlord may require, it being understood and agreed that the Subtenant Improvements shall be insured by Subtenant pursuant to Article 10 of the Sublease immediately upon completion thereof. Such insurance shall be in amounts and shall include such extended coverage endorsements as may be reasonably required by Landlord, and in form and with companies as are required to be carried by Subtenant as set forth in Article 10 of the Sublease. 4.2.1.3.3 General Terms. Certificates for all insurance carried pursuant to this Section 4.2.1.3.3 shall be delivered to City and Landlord before the commencement of construction of the Subtenant Improvements and before the Contractor's equipment is moved onto the site. All such policies of insurance must contain a provision that the company writing said policy will give Landlord thirty (30) days prior written notice of ARC Sublease 2806-B EXHIBIT C Page 4 of 7 VI any cancellation or lapse of the effective date or any reduction in the amounts of such insurance. If the Subtenant Improvements are damaged by any cause during the course of the construction thereof, Subtenant shall immediately repair the same at Subtenant's sole cost and expense. All policies carried under this Section 4.2.1.3.3 shall insure Landlord and Subtenant, as their interests may appear, as well as Contractor and Subtenant's Agents, and shall name as additional insureds Landlord's property manager, and all mortgagees and ground lessors of the Building. All insurance, except workers' compensation, maintained by Subtenant's Agents shall preclude subrogation claims by the insurer against anyone insured thereunder . Such insurance shall provide that it is primary insurance as respects the owner and that any other insurance maintained by owner is excess and noncontributing with the insurance required hereunder. The requirements for the foregoing insurance shall not derogate from the provisions for indemnification of Landlord by Subtenant under Section 4.2.2.3 of this Work Letter. 4.2.2 Governmental Compliance. The Subtenant Improvements shall comply in all respects with the following: (i) the Code and other state, federal, city or quasi- governmental laws, codes, ordinances and regulations, as each may apply according to the rulings of the controlling public official, agent or other person; (ii) applicable standards of the American Insurance Association (formerly, the National Board of Fire Underwriters) and the National Electrical Code; and (iii) building material manufacturer's specifications. 4.2.3 Inspection by city and Landlord. Subtenant grants Landlord and city the right to inspect the Subtenant Improvements at all times, provided however, that City or Landlord's failure to inspect the Subtenant Improvements shall in no event constitute a waiver of any of City or Landlord's rights hereunder nor shall City or Landlord's inspection of the Subtenant Improvements constitute City's or Landlord's approval of the same. Should City or Landlord disapprove any portion of the Subtenant Improvements, City shall notify Subtenant in writing of such disapproval and shall specify the items disapproved and basis for disapproval. Any defects or deviations in, and/or disapproval by City or Landlord of, the Subtenant Improvements shall be rectified by Subtenant at no expense to City and Landlord. However, Subtenant agrees that if Landlord determines that a defect or deviation exists or disapproves of any matter in connection with any portion of the Subtenant Improvements and such defect, deviation or matter might adversely affect the mechanical, electrical, plumbing, heating, ventilating and air conditioning or life-safety systems of the Building,the structure or exterior appearance of the Building or any other Subtenant's use of such other Subtenant's premises, Landlord may, take such action as Landlord deems necessary, at Subtenant's expense and without incurring any liability on Landlord's part, to correct any such defect, deviation and/or matter, including, without limitation, causing the cessation of performance of the construction of the Subtenant Improvements until such time as the defect, deviation and/or matter is corrected to Landlord's satisfaction. 4.2.4 Meetings. Commencing upon the execution of the Sublease, Subtenant shall hold periodic meetings at a reasonable time, with the Architect and the Contractor regarding the progress of the preparation of Construction Drawings and the construction of the ARC Sublease 2806-B EXHIBIT C Page 5 of 7 vi Subtenant Improvements and City and Landlord and/or their agents shall receive prior notice of, and shall have the right to attend, all such meetings, and, upon Landlord's request, certain of Subtenant's Agents shall attend such meetings. 4.3 Notice of Completion; Copy of "As Built" Plans. Within ten (10) days after completion of construction of the Subtenant Improvements, Subtenant shall cause a Notice of Completion to be recorded in the office of the Recorder of the County in which the Building is located and shall furnish a copy thereof to City and Landlord upon such recordation. If Subtenant fails to do so, Subtenant agrees that Landlord may execute and file the same on behalf of Subtenant as Subtenant's agent for such purpose, at Subtenant's sole cost and expense. At the conclusion of construction, (i) Subtenant shall cause the Architect and Contractor (A) to update the Approved Working Drawings as necessary to reflect all changes made to the Approved Working Drawings during the course of construction, (B) to certify to the best of their knowledge that the "record-set" of as-built drawings are true and correct, which certification shall survive the expiration or termination of the Sublease, (C) to deliver to City and Landlord two (2) sets of such as-built drawings within ninety (90) days following issuance of a certificate of occupancy for the Premises, and (D) to deliver to City and Landlord computer disks or drives containing the Approved Working Drawings in Auto CAD format, and (ii) Subtenant shall deliver to City and Landlord a copy of all warranties, guaranties, and operating manuals and information relating to the improvements, equipment, and systems in the Premises. 4.4 Coordination by Subtenant's Agents with City and Landlord. Upon Subtenant's delivery of the Contract to Landlord under Section 4.2.1 of this Work Letter, Subtenant shall furnish City and Landlord with a schedule setting forth the projected date of the completion of the Subtenant Improvements and showing the critical time deadlines for each phase, item or trade relating to the construction of the Subtenant Improvements to the extent such schedule is available. SECTION 5 MISCELLANEOUS 5.1 Subtenant's Representative. Subtenant has designated as its sole representative with respect to the matters set forth in this Work Letter,who shall have full authority and responsibility to act on behalf of the Subtenant as required in this Work Letter. 5.2 Landlord's Representative. Landlord has designated Benson Liu as its sole representative with respect to the matters set forth in this Work Letter, who, until further notice to Subtenant, shall have full authority and responsibility to act on behalf of the Landlord as required in this Work Letter. 5.3 City's Representative. Subtenant has designated its Josh Arndt, as its sole representative with respect to the matters set forth in this Work ARC Sublease 2806-B EXHIBIT C Page 6 of 7 vi Letter, who shall have full authority and responsibility to act on behalf of the Subtenant as required in this Work Letter. 5.4 Time of the Essence in This Work Letter. Unless otherwise indicated, all references herein to a "number of days" shall mean and refer to calendar days. If any item requiring approval is timely disapproved by City or Landlord, the procedure for preparation of the document and approval thereof shall be repeated until the document is approved by City and Landlord. 5.5 Subtenant's Sublease Default. Notwithstanding any provision to the contrary contained in the Sublease, if an event of default by Subtenant of this Work Letter (which, for purposes hereof, shall include, without limitation, the delivery by Subtenant to Landlord of any oral or written notice that Subtenant intends to cease the design and/or construction of the Subtenant Improvements and/or that Subtenant does not intend to occupy the Premises, and/or any other anticipatory breach of the Sublease) or Section 16.1 of the Sublease has occurred at any time on or before the Substantial Completion of the Premises, then (i) in addition to all other rights and remedies granted to Landlord pursuant to the Sublease, Landlord shall have the right to cause Contractor to cease the construction of the Premises (in which case, Subtenant shall be responsible for any delay in the Substantial Completion of the Premises caused by such work stoppage), and (ii) all other obligations of City and Landlord under the terms of this Work Letter shall be forgiven until such time as such default is cured pursuant to the terms of the Sublease (in which case, Subtenant shall be responsible for any delay in the Substantial Completion of the Premises caused by such action by Landlord). In addition, if the Sublease is terminated prior to the Commencement Date for any reason due to a default by Subtenant as described in Section 16.1 of the Sublease or under this Work Letter(including,without limitation, any anticipatory breach described above in this Section 5.4), then (A) Subtenant shall be liable to City for all damages available to City pursuant to the Sublease and otherwise available to City at law and/or in equity by reason of a default by Subtenant under the Sublease or this Subtenant Work Letter, including,but not limited to, any costs related to the removal of all or any portion of the Subtenant Improvements and restoration costs related thereto. ARC Sublease 2806-B EXHIBIT C Page 7 of 7