EXHIBIT 10.10
BASIC LEASE INFORMATION
Lease Date: July 8, 1999
Landlord: NEW YORK LIFE INSURANCE COMPANY
Address of Landlord: c/o ▇▇▇▇▇▇▇▇ ▇▇▇▇ Company
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Tenant: PURE WATER CORPORATION,
an AquaSource Company,
a Delaware corporation
Premises: ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
Paragraph 1
"Premises approximately 75,940 square feet in Building B of
approximately 75,940 square feet (computed from measurements
to the edge of the roofline of the building and to the center
of interior walls, such premises being shown and outlined in
red on the plan attached hereto as Exhibit A, and being part
of the real property described in Exhibit B attached hereto.
Paragraph 1 Lease Term Commencing on the "Commencement Date" as
hereinafter defined and ending 88 months thereafter except
that in the event the Commencement Date is a date other than
the first day of a calendar month, said term shall extend for
said number of months in addition to the remainder of the
calendar month following the "Commencement Date".
Paragraph 1 Scheduled Term Commencement Date: September 1, 1999
Paragraph 2 Monthly Base Rent: $28,857.00
Paragraph 2B Security Deposit: $43,361.00
Paragraph 4A Tenant's Initial Monthly Escrow Payment for Taxes
and Other Charges: $ 4,670.00
Paragraph 7 Tenant's Initial Monthly Common Area Maintenance
Charge: $ 2,764.00
Paragraph 13B Terrain's Initial Monthly Insurance
Escrow Payment: $ 349.00
Tenant's Initial Monthly Payment Total: $36,640.00
The foregoing Basic Lease Information is hereby incorporated
into and made a part of this Lease. Each reference in this
Lease to any of the Basic Lease Information shall mean the
respective Information herein above set forth and shall be
construed to incorporate all of the terms provided under the
particular Lease paragraph pertaining to such information. In
the event of any conflict between any Basic Lease Information
and the Lease, the former shall control.
LEASE AGREEMENT
THIS LEASE AGREEMENT, made and entered into by and between NEW YORK LIFE
INSURANCE COMPANY, hereinafter referred to as "Landlord", and PURE WATER
CORPORATION, an AquaSource Company, a Delaware corporation, hereinafter referred
to as "Tenant";
WITNESSETH
1. PREMISES AND TERM.
A. A. In consideration of the obligation of Tenant to pay rent as herein
provided, and in consideration of the other terms, provisions and
covenants hereof, Landlord hereby demises and leases to Tenant, and
Tenant hereby takes and leases from Landlord those certain Premises as
outlined in red on Exhibit "A" attached hereto (hereinafter referred to
as the "Premises") and incorporated herein by reference, together with
all rights, privileges, easements, appurtenances, and amenities belonging
to or in any way appertaining to the Premises and together with the
buildings and other improvements situated or to be situated upon land
described in Exhibit "B" attached hereto.
B. TO HAVE AND TO HOLD the same for a term commencing on "Commencement
Date"; as hereinafter defined, and ending thereafter as specified in the
Basic Lease Information, attached hereto, (the "Lease Term"), provided,
however, that, in the event the "Commencement Date" is a date other than
the first day of a calendar month said term shall extend for said number
of months in addition to the remainder of the calendar month following
the "Commencement Date".
C. The "Commencement Date" shall be the Scheduled Term Commencement Date
shown in the Basic Lease Information, attached hereto and incorporated
herein by reference, or the date upon which the Premises shall have been
substantially completed in accordance with the plans and specifications
described in Exhibit "C" attached hereto and incorporated herein by
reference, whichever is earlier. If the Premises shall not have been
substantially completed as aforesaid by the Scheduled Term Commencement
Date, Tenant's obligations to pay rent and its other obligations for
payment under this Lease shall commence on the date the Premises are
substantially completed as aforesaid, and Landlord shall not be liable to
Tenant for any loss or damage resulting from such delay. Landlord shall
notify ▇▇▇▇▇▇ in writing as soon as Landlord deems the Premises to be
substantially completed and ready for occupancy. In the event that the
Premises have not in fact been substantially completed as aforesaid,
Tenant shall notify Landlord of its objections. Landlord shall have a
reasonable time after delivery of such notice in which to take such
corrective action as may be necessary, and shall notify Tenant in writing
as soon as it deems such corrective actions has been completed so that
the Premises are substantially completed and ready for occupancy. The
taking of possession by ▇▇▇▇▇▇ shall be deemed conclusively to establish
that the Premises are in good and satisfactory condition, as of when
possession was so taken. Tenant acknowledges that no representations as
to the repair of the Premises have been made by Landlord, unless such are
expressly set forth in this Lease. After the Commencement Date, Tenant
shall, upon demand, execute and deliver to Landlord a letter of
acceptance of delivery of the Premises, specifying the Commencement Date
the rent commencement date, in recordable form. In the event of any
dispute as to the substantial completion or work performed or required to
be performed by Landlord, the certificate of Landlord's architect or
general contractor shall be conclusive.
2. BASE RENT AND SECURITY DEPOSIT.
▇. ▇▇▇▇▇▇ agrees to pay to Landlord Base Rent for the premises, in
advance, without demand, deduction or set off, for the entire Lease Term
hereof at the rate specified in the Basic Lease Information, payable in
monthly installments. One such monthly installment shall be due and
payable on the date hereof and a like monthly install shall be due and
payable on or before the first day of each calendar month succeeding the
Commencement Date recited above during the Lease Term, except that the
rental payment for any fractional calendar month at the commencement or
end of the Lease period shall be prorated on the basis of a 30-day month.
B. In addition, ▇▇▇▇▇▇ agrees to deposit with Landlord on the date hereof
a security deposit in the amount specified in the Basic Lease
Information, which sum shall be held by Landlord, without obligation for
interest, as security for the performance of Tenant's covenants and
obligations under this Lease, it being expressly understood and agreed
that such deposit is not an advance rental deposit, not the last month's
rent nor a measure of Landlord's damages in the event of Tenant's
default. Upon the occurrence of any event of default by Tenant, Landlord
may, from time to time, without prejudice to any other remedy provided
herein or provided by law, use such deposit to the extent necessary to
make good any arrears of rent or other payments due Landlord hereunder,
and any other damage, injury, expense, or liability caused by such event
of default; or to perform any obligation required of Tenant under the
Lease; and ▇▇▇▇▇▇
shall pay to Landlord on demand the amount so applied in order to restore
the security deposit to its original amount. Although the security
deposit shall be deemed the property of Landlord, any remaining balance
of such deposit shall be returned by Landlord to Tenant at such time
after termination of this Lease that all of Tenant's obligations under
the Lease have been fulfilled.
3. USE.
A. The Premises shall he used only for the purpose of general office,
receiving, storing, shipping, assembly, light manufacturing, and selling
(other than retail) products, materials and merchandise made and/or
distributed by Tenant and for such other lawful purposes as may be
incidental thereto. Outside storage, including without limitation, trucks
and other vehicles, is prohibited without Landlord's prior written
consent. Landlord does, however, grant Tenant permission to park or store
vehicles or other items reasonably used in conducting business including
but not limited to water tanks, in the areas indicated on exhibit on
Exhibit A. Tenant agrees not to park any vehicles or to allow the parking
of Tenant's vehicles in areas outside of this dedicated area. All such
parking or storage shall comply with applicable laws codes and
ordinances. Plans and specifications therefor shall be subject to the
prior review and approval of Landlord, not to be reasonably withheld.
Tenant shall at its own cost and expense obtain any and all licenses and
permits necessary for its use of the Premises. Tenant shall comply with
all governmental laws, ordinances and regulations applicable to the use
of the Premises, and shall promptly comply with all governmental orders
and directives including but not limited to those regarding the
correction, prevention and abatement of nuisances in or upon, or
connected with, the Premises, all at Tenant's sole expense. Tenant shall
not permit any objectionable or unpleasant odors, smoke, dust, gas, noise
or vibrations to emanate form the Premises, nor take any other action
which would constitute a nuisance or would disturb or endanger any other
tenants of the building in which the Premises are situated or
unreasonably interface with their use of their respective Premises. In
addition to any other remedies Landlord may have for a breach by Tenant
of the terms of this Section 3, Landlord shall have the right to have
Tenant evicted from the Premises. Without Landlord's prior written
consent, Tenant shall not receive, store or otherwise handle any product,
material or merchandise which is explosive or highly inflammable. Tenant
will not permit the Premises to be used for any purpose or in any manner
(including without limitation any method of storage) which would render
the insurance thereon void or the Insurance risk more hazardous or cause
the State Board of Insurance or other Insurance authority to disallow any
sprinkler credits. In the event Tenant's use of Premises shall result in
an increase in insurance premiums, Tenant shall be solely responsible for
said increase.
B. HAZARDOUS MATERIALS:
Without limiting any provision of this Lease regarding compliance with
applicable laws, Landlord and Tenant hereby further mutually agree as
follows:
(a) Tenant shall at all times and in all respects comply with all
applicable Federal, state and local laws, ordinances and regulations,
including, but not limited to, the Federal Water Pollution Control Act
(33 U.S.Css.1251, et seq.), Resource Conservation & Recovery Act (42
U.S.C.ss.6901, et seq.), Safe Drinking Water Act (42 U.S.C.ss.3000f, et
seq.), Toxic Substances Control Act (15 U.S.D.ss.2601, et seq ), the
Clean Air Act (42 U.S.C.ss.9601, et seq.), and other comparable local,
state and federal laws, currently in force or enacted in the future
("Hazardous Materials Laws"), relating to industrial hygiene,
environmental protection or the use, analysis, generation, manufacture,
storage, sale, disposal or transportation of any oil, flammable
explosives, asbestos, urea formaldehyde, radioactive materials or waste,
or other hazardous, toxic, contaminated or polluting materials,
substances or wastes, including, without limitation any "hazardous
substances", "hazardous wastes", "hazardous materials" or "toxic
substances" under any such laws, ordinances or regulations (collectively,
"Hazardous Materials").
(b) Tenant shall neither cause nor permit any Hazardous Materials to be
used, generated, stored, transported, handled or disposed of in or about
the Premises at any time. Tenant shall, at its expense, procure, maintain
in effect and comply with all conditions of any and all permits,
licenses, and other governmental and regulatory approvals required of
Tenant for Tenant's use of the Premises. Upon expiration or earlier
termination of the Lease term, Tenant shall cause all Hazardous Materials
placed on the Premises, if any, to be removed from the Premises and
transported for use, storage or disposal in accordance with and
compliance with all applicable Hazardous Materials Laws. Tenant shall not
take any remedial action in response to the presence of any Hazardous
Materials in or about the Premises or the Premises, nor enter into any
settlement agreement, consent decree or other compromise in respect to
any claims relating to any Hazardous Materials in any way connected with
the Premises, without first notifying Landlord of ▇▇▇▇▇▇'s intention to
do so and affording Landlord ample opportunity to appear, intervene or
otherwise appropriately assert and protect Tenant's interest with respect
thereto.
(c) Tenant shall immediately notify Landlord in writing of: (i) any
enforcement, cleanup, removal or other governmental or regulatory action
instituted, completed or threatened pursuant to any Hazardous Materials
Laws relative to the Premises; (ii) any claim made or threatened by any
person against Tenant or the Premises relating to damage, contribution,
cost recovery compensation, loss or injury resulting from or claimed to
result from any Hazardous Materials; and (iii) any reports made to any
governmental agency arising out of or in connection with any Hazardous
Materials in or removed from the Premises, including any complaints,
warnings or asserted violations in connection therewith. Tenant shall
also supply to Landlord as promptly as possible copies of all claims,
reports, complaints, notices, warnings or asserted violations, relating
in any way to the Premises, the Premises, or Tenant's use of the
Premises.
(d) Tenant shall indemnify, defend (by counsel reasonably acceptable to
Landlord), protect, and hold Landlord and its affiliates free and
harmless from and against any and all claims, liabilities, penalties,
forfeitures, losses or expenses (including reasonable attorney's fees),
or death of or injury to any person or damage to any property whatsoever
to the extent that the same arise from or are caused in whole or in part,
directly or indirectly, by: (i) the presence in, on, under or about the
Premises of any Hazardous Materials due to Tenant's or its agents,
employees or contractors acts or omissions; (ii) Tenant's use, analysis,
storage, transportation, disposal, release, threatened release, discharge
or generation of Hazardous Materials Law. Tenant's obligations hereunder
shall include, without limitation, and whether foreseeable or
unforeseeable, all costs of any required or necessary repair, cleanup or
detoxification or decontamination of the Premises, or the preparation and
implementation of any closure, remedial action or other required plans in
connection therewith, and shall survive the expiration or earlier
termination of the term of this Lease.
(e) Landlord shall indemnify, defend (by counsel reasonably acceptable
to Tenant), protect, and hold Tenant and its affiliates free and harmless
from and against any and all claims, liabilities, penalties, forfeitures,
losses or expenses (including reasonable attorney's fees), or death or
injury to any person or damage to any property whatsoever to the extent
that the same arise from or are caused in whole or in part, directly or
indirectly, by: (i) the presence in, on, under or about the Premises of
any Hazardous Materials due to Landlord's or its agents, employees or
contractors acts or omissions; (ii) Landlord's use, analysis, storage,
transportation, disposal, release, threatened release, discharge or
generation of Hazardous Materials to, in on, under, about or from the
Premises; or (iii) Landlord's failure to comply with any Hazardous
Materials Law. Landlord's obligations hereunder shall include, without
limitation, and whether foreseeable or unforeseeable, all costs of any
required or necessary repair, cleanup or detoxification or
decontamination of the Premises or the preparation and implementation of
any closure, remedial action or other required plans in connection
therewith, and shall survive the expiration or earlier termination of the
term of this Lease.
For purposes of the release and indemnity provisions hereof (but without
limiting any right either Landlord or Tenant may have against third
party), any act or omission of Landlord or Tenant, or by their employees,
agents subtenants (only in the case of Tenant), contractors or
subcontractors of Landlord of Tenant or others acting for or on behalf of
Landlord or Tenant (whether or not they are negligent, intentional,
willful or unlawful) shall be strictly attributable to either Landlord or
Tenant, as the case may be. If either party fails to fully comply with
the provisions of this Article, the other party may at its option, obtain
a written report from an independent environmental auditor and/or perform
any or all of the noncomplying party's obligations hereunder, and all
reasonable costs and expenses incurred by the other party shall be
payable by the noncomplying party immediately upon demand.
4. TAXES AND OTHER CHARGES
▇. ▇▇▇▇▇▇ agrees to pay its proportionate share of any and all real and
personal property taxes, regular and special assessments, license fees,
public service impact fees and other charges of any kind and nature
whatsoever, payable by Landlord (with the exception of any income taxes
incurred by Landlord) as a result of any public or quasi-public
authority, private party, or owner's association levy, assessment or
imposition against, or arising out of Landlord's ownership of or interest
in, the real estate described in Exhibit "B" attached hereto, together
with the building and the grounds, parking areas, driveways, roads, and
alleys around the building in which the Premises are located, or any part
thereof (hereinafter collectively referred to as the "Charges"). During
each month of the Lease Term, Tenant shall make a monthly escrow deposit
with Landlord (the "Escrow Payment") equal to 1/12 of its proportionate
share of the Charges which will be due and payable for that particular
calendar year. Any lump sum public service impact fees paid by Landlord
shall be amortized over ten (10) years at interest not to exceed twelve
percent (12%) per annum, and equal installments of such fee, together
with interest accrued thereon, shall be payable monthly as a portion of
the Charges. Tenant authorizes Landlord to use the funds deposited by
Tenant with Landlord under the Paragraph 4 to pay the Charges. Each
Escrow Payment shall be due and payable, as additional rent at the same
time and in the same manner as the payment of monthly rental as provided
herein. The amount of the Initial Monthly Escrow Payment will be
specified in the Basic Lease
Information. The Initial Escrow Payment is based upon Tenant's
proportionate share of the Charges. The Escrow Payment account of Tenant
shall be reconciled annually. If the Tenant's total Escrow Payments are
less than Tenant's actual pro rata share of the Charges, Tenant shall pay
to Landlord upon demand the difference; if the Tenant's total Escrow
Payments are more that Tenant's actual pro rata share of the Charges,
Landlord shall retain such excess and credit it to Tenant's Escrow
Payment account for the successive year's Charges. Tenant's proportionate
share of the Charges shall be computed by multiplying the Charges by a
fraction, the numerator of which shall be the number of gross leasable
square feet of floor space in the Premises and the denominator of which
shall be the total applicable gross leasable square footage; or such
other equitable apportionment as may be adopted.
B. If Tenant should fail to pay any Escrow Payments required to be paid
by Tenant hereunder, in addition to any other remedies provided herein,
Landlord may, if it so elects, pay such Escrow Payments or taxes,
assessments, license fees and other charges. Any sums so paid by Landlord
shall be deemed to be so much additional rental owing by Tenant to
Landlord and due and payable upon demand as additional rental plus
interest at the rate of eighteen percent (18%) per annum from the date of
payment by Landlord until repaid by ▇▇▇▇▇▇.
C. (1) If at any time during the Lease Term, the present method
of taxation shall be changed so that in lieu of the whole or
any part of any taxes, assessments, fees or charges levied,
assessed or imposed on real estate and the improvements
thereon, there shall be levied, assessed or imposed on
Landlord a capital levy or other tax directly on the rents
received therefrom and/or a franchise tax, assessment, levy or
charge measured by or based, in whole or in part, upon such
rents or the present or any future building or buildings, than
all such taxes, assessments, fees or charges, or the part
thereof so measured or based, shall be deemed to be included
within the term "Charges" for the purposes hereof.
(2) Tenant may, alone or along with other tenants of the
building containing the Premises, at its sole cost and
expense, in its or their own name(s) dispute and contest any
Charges by appropriate proceedings diligently conducted in
good faith, but only after Tenant and all other tenants, if
any, joining with Tenant in such contest have deposited with
Landlord the amount so contested and unpaid or their
proportionate shares thereof as the case may be, which shall
be held by Landlord without obligation for interest until the
termination of the proceedings, at which time the amount(s)
deposited shall be applied by Landlord toward the payment of
the items held valid (plus any court costs, interest,
penalties and other liabilities associated with the
proceeding(s), and ▇▇▇▇▇▇'s share of any excess shall be
returned to Tenant. ▇▇▇▇▇▇ further agrees to pay to Landlord
upon demand ▇▇▇▇▇▇'s share (as among all Tenants who
participated in the contest) of all court costs, interest,
penalties and other liabilities relating to such proceedings.
Tenant hereby indemnifies and agrees to hold harmless the
Landlord from mid against any cost, damage or expense
(including attorney's fees) in connection with any such
proceedings.
(3) Any payment to be made pursuant to this Paragraph 4 with
respect to the calendar year in which this Lease commences or
terminates shall bear the same ratio to the payment which
would be required to be made for the full calendar year as
that part of such calendar year covered by the Lease Term
bears to a full calendar year.
▇. ▇▇▇▇▇▇ shall be liable for all taxes levied against personal property
and trade fixtures placed by Tenant in the Premises. If any such taxes
are levied against Landlord or Landlord's property and if Landlord elects
to pay the same or if the assessed value of Landlord's property is
increased by inclusion of personal property and trade fixtures placed by
Tenant in the Premises and Landlord elects to pay the taxes bases on such
increase, Tenant shall pay to Landlord upon demand that part of such
taxes for which ▇▇▇▇▇▇ is primarily liable hereunder.
5. TENANT'S MAINTENANCE
A Tenant shall at its own cost and expense keep and maintain all parts of
the Premises (except those for which Landlord is expressly responsible
under the terms of this Lease) in good condition, promptly making all
necessary repair and replacements, including but not limited to, windows,
glass and plate glass, doors, any special office entry, interior walls
and finish work, floor and floor covering, downspouts, gutters, heating
and air-conditioning systems, dock boards, truck doors, dock bumpers,
paving, plumbing work and fixtures, termite and pest extermination,
regular removal of trash and debris, keeping the parking areas,
driveways, alleys and the whole of the Premises in a clean and sanitary
condition. Tenant shall not be obligated to repair any damage caused by
fire, tornado, or other casualty covered by the insurance to be
maintained by Landlord pursuant to subparagraph 13(a) below, except that
Tenant shall be obligated to repair all wind damage to glass except with
respect to tornado or hurricane damage. Any expenditure by Tenant in any
fixture of the Premises that must be capitalized under GAAP, for any
reason other than
replacement due to damage by the Tenant should be amortized over the
useful life expectancy of the fixture and Tenant should only be
responsible for payment of that portion equal to the term of the Lease.
In such case, Landlord will provide Tenant with an amortization budget.
B. Tenant shall not damage any demising wall or disturb the integrity and
support provided by any demising wall and shall, at its sole cost and
expense, promptly repair any damage or injury to any demising wall caused
by Tenant or its employees, agents, licensees or invitees.
C. Tenant and its employees, customers and licensees shall have the right
to use the parking area, if any, as may be designated by Landlord in
writing, subject to such reasonable rules and regulations as Landlord may
from time to time prescribe and subject to rights or ingress and egress
of other tenants. Landlord shall not be responsible for enforcing
Tenant's exclusive parking rights against any third parties. If Tenant or
any other particular tenant of the building can be clearly identified as
being responsible for obstructions or stoppage of a common sanitary
sewage line, then Tenant, if Tenant is responsible, or such other
responsible Tenant, shall pay the entire cost thereof, upon demand, as
additional rent.
D. Tenant shall, at its own cost and expense enter into a regularly
scheduled preventive maintenance/service contract with a maintenance
contractor for servicing all heating and air-conditioning systems and
equipment within the Premises.
6. LANDLORD'S REPAIRS. After reasonable notice from Tenant, Landlord shall
repair the roof and exterior walls and the cost thereof (except for any
costs incurred to repair structural defects) shall be shared as provided
in Paragraph 7. Tenant shall repair and pay for any damage to such items
to be maintained by Landlord caused by any act, omission or negligence of
Tenant, or Tenant's employees, agents, licensees or invitees, or caused
by ▇▇▇▇▇▇'s default hereunder. The term "walls" as used herein shall not
include windows, glass or plate glass, doors, special store fronts or
office entries. Tenant shall immediately give Landlord written notice of
defect or need for repairs, after which Landlord shall have a reasonable
opportunity and time to repair same or cure such defect. Landlord's
liability with respect to any defects, repairs or maintenance for which
Landlord is responsible under any of the provisions of this Lease shall
be limited to the cost of such repairs or maintenance or the curing of
such defect.
7. MONTHLY COMMON-AREA MAINTENANCE CHARGE. ▇▇▇▇▇▇ agrees to pay as an
additional charge each month its proportionate share of the cost of
operation and maintenance of the Common Area which shall be defined from
time to time by Landlord. Common Area costs which may be incurred by
Landlord, at its discretion, shall include, but not be limited to costs
incurred for lighting, water, sewage, trash removal, exterior painting,
exterior window cleaning, sweeping, accounting, policing, services
negotiation, customary property management fee not to exceed 5% of
rentals, sewer lines, plumbing, paving, landscape maintenance, plant
material replacement and other like charges, and for administration of
the items set forth in this paragraph. Landlord shall maintain the Common
Area in reasonably good condition and repair. The proportionate share to
be paid by Tenant of the cost of operation and maintenance of the Common
Area shall be computed on the ratio that the gross leasable square feet
of the Premises bears to the total applicable gross leasable square
footage or such other equitable apportionment as may be adopted. Landlord
shall make monthly or other periodic charges based upon the estimated
annual cost of operation and maintenance of the Common Area, payable in
advance but subject to adjustment after the end of the year on the basis
of the actual cost for such year. Any such periodic charges shall be due
and payable upon delivery of notice thereof. The initial Common-Area
Maintenance Charges, subject to adjustment as provided herein, shall be
due and payable, as additional rent, at the same time and in the same
manner as the time and manner of the payment of monthly rental as
provided herein. The amount of the initial monthly Common-Area
Maintenance Charge shall be as specified in the Basic Lease Information.
8. ALTERATIONS
A. Tenant shall not make any alterations, additions or improvements to
the Premises (including but not limited to roof and wall penetrations)
without the prior written consent of Landlord. Tenant may, without the
consent of Landlord, but at its own cost and expense and in a good
workmanlike manner erect such shelves, bins, machinery and trade fixtures
as it may deem advisable, without altering the basic character of the
building or improvements and without overloading or damaging such
building or improvements, and in each case complying with all applicable
governmental laws, ordinances, regulations and other requirements. All
alterations, additions, improvements and partitions erected by Tenant
shall be and remain property of Tenant during the term of this Lease and
Tenant shall, unless Landlord otherwise elects as hereinafter provided,
to remove all alterations, additions, improvements and partitions erected
by tenant and restore the Premises to their original condition by the
date of termination of this lease or upon earlier vacating of the
Premises, provided, however, that if Landlord so elects prior to
termination of this Lease or upon earlier vacating of the Premises,
provided, however, that if Landlord so elects, prior to
termination of this Lease or upon earlier vacating of the Premises, such
alterations, additions, improvements and partitions shall become the
property of Landlord as of the date of termination of this Lease or upon
earlier vacating of the Premises and shall be delivered up to the
Landlord with the Premises. All shelves, bins, machinery and trade
fixtures installed by Tenant may be removed by Tenant prior to the
termination of this Lease if Tenant so elects, and shall be removed by
the date of termination of this Lease or upon earlier vacating of the
Premises if required by Landlord; upon any such removal Tenant shall
restore the Premises to their original condition. All such removals and
restoration shall be accomplished in good workmanlike manner so as not to
damage the primary structure or structural qualities of the buildings and
other improvements situated on the Premises.
B. Tenant shall remove any sumps and clarifiers and any related Hazardous
Materials ("Hazardous Material" shall mean petroleum and petroleum
products, asbestos, and PCB's and any "hazardous substances", "hazardous
materials", or "toxic substances" in the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended, the
Hazardous Materials Transportation Act, as amended, or the Resource
Conservation and Recovery Act, as amended, those substances, materials
and wastes which are defined and "hazardous wastes" or as "hazardous
substances" in the Washington State Model Toxics Control Act, as codified
at Chapter 70.105D, Revised Code of Washington, and "hazardous" or
"toxic" in the regulations adopted or publication promulgated pursuant to
any of said laws) in or about the Premises and associates with ▇▇▇▇▇▇'s
use and occupancy thereof upon the expiration of earlier termination of
this Lease.
C. Notwithstanding anything to the contrary contained herein, ▇▇▇▇▇▇▇▇
agrees that the Tenant shall not be responsible for, and Landlord shall
hold Tenant harmless against, any costs of cleanup or removal arising
from or associated with any hazardous material existing in, on or
throughout the Premises, as of anytime up to the date Tenant occupies the
Premises pursuant to the terms of this Lease.
9. SIGNS. Tenant shall not install signs upon the Premises without
Landlord's prior written approval, and any such signage shall be subject
to any applicable governmental laws, ordinances, regulations and other
requirements. Tenant shall remove all such signs by the termination of
this Lease. Such installations and removals shall be made in such a
manner as to avoid injury or defacement of the building and other
improvements, and Tenant shall repair any injury or defacement, including
without limitation discoloration caused by such installation and/or
removal.
10. INSPECTION.
A. Landlord and ▇▇▇▇▇▇▇▇'s agents and representatives shall have the
right to enter and inspect the Premises at any reasonable time during
business hours, for the purpose of ascertaining the condition of the
Premises in order to make such repairs as may be required or permitted to
be made by Landlord under the terms of this Lease. During the period that
is six (6) months prior to the end of the Term hereof, Landlord and
Landlord's agents and representatives shall have the right to enter the
Premises at any reasonable time during business hours for the purpose of
showing the Premises and shall have the right to erect on the Premises a
suitable sign indicating the Premises are available.
B. Tenant shall give written notice to Landlord at least thirty (30) days
prior to vacating the Premises and shall arrange to meet with Landlord
for a joint inspection of the Premises prior to vacating. In the event of
Tenant's failure to give such notice or arrange such joint inspection,
Landlord's inspection at or after ▇▇▇▇▇▇'s vacating the Premises shall be
conclusively deemed correct for the purpose of determining Tenant's
responsibility for repairs and restoration. It shall be the
responsibility of Tenant, prior to vacating the Premises, to clean and
repair the Premises and restore them to the condition in which they were
in upon delivery of the Premises to Tenant at the Commencement Date,
reasonable wear and tear excepted. Cleaning, repair and restoration shall
include, but not be limited to, removal of all trash, cleaning and
repainting of walls, where necessary, cleaning of carpet and flooring,
replacement of light bulbs and tubes, cleaning and wiping down of all
fixtures, maintenance and repair of all heating and air-conditioning
systems, and all similar work, which shall be done at the latest
practical date prior to vacation of the Premises.
11. UTILITIES. Landlord agrees to provide at its cost water, electricity and
gas service connections into the Premises; but Tenant shall pay for all
water, gas, heat, light, power, telephone, sewer, sprinkler charges and
other utilities and services used on or from the Premises, together with
any taxes, penalties, surcharges or the like pertaining thereto and any
maintenance charges for utilities and shall furnish all electric light
bulbs and tubes. If any such services are not separately metered to
Tenant, Tenant shall pay a reasonable proportion as determined by
Landlord of all charges jointly metered with other Premises. Landlord
shall in no event be liable for any interruption or failure of utility
services on the Premises.
12. ASSIGNMENT AND SUBLETTING
Tenant shall not have the right, voluntarily or involuntarily, to assign,
convey, transfer, mortgage or sublet the whole or any part of the
Premises under this Lease without the prior written consent of Landlord.
Notwithstanding anything contained to the contrary in this Section,
Tenant may assign this Lease to its parent corporation or to any
wholly-owned subsidiary corporation or Affiliate (as hereinafter defined)
of Tenant without obtaining the prior written consent of Landlord,
provided that all the following conditions are met:
(i) Any such assignee shall remain the parent of Tenant, or a
wholly-owned subsidiary corporation of Tenant, or an affiliate as the
case may be;
(ii) The net worth of the assignee shall not be not less than Tenant's
net worth prior to such assignment or at the time of execution of this
Lease, whichever shall be greater;
(iii) Tenant shall have given Landlord thirty (30) days' prior notice
of such assignment;
(iv) Tenant shall not be in default under any of the provisions of this
Lease at the time of such assignment; and
(v) The assignee furnishes Landlord at least thirty (30) days' prior to
the effective date of said assignment a written instrument satisfactory
to Landlord agreeing to assume and be bound by all the conditions,
obligations and agreements contained in this Lease.
As used herein, (i) "Affiliate" shall mean an entity which (aa) directly
or indirectly control, Tenant, (bb) is under the direct or indirect
control of Tenant or (cc) is under common ownership of fifty-one percent
(51%) or more of the voting securities or rights of the controlled
entity, (ii) "parent corporation " shall mean a company which owns a
majority of whose voting stock is owned by Tenant. Notwithstanding any
such assignment, the assignor and any guarantors hereunder shall remain
fully and primarily liable for the performance of all conditions,
obligations and agreements of tenant under this lease. In the event
Tenant applies to Landlord for consent to assign, convey, transfer or
sublet the Premises, Landlord may condition such consent upon the right
to receive one-half of the profit, if any, which Tenant may realize on
account of such assignment, conveyance, transfer or sublease of the
Premises. For purposes of this paragraph, "profit" shall mean any sum
which the assignee, Sublessee or transferee is required to pay, or which
is credited to Tenant as rent in excess of the rents required to be paid
by Tenant to Landlord under this Lease. Landlord also reserves the right
to recapture the Premises provided, that Tenant may, by written notice
given to Landlord within five (5) business days after ▇▇▇▇▇▇'s receipt of
Landlord's recapture notice, revoke Tenant's request for consent, in
which event Landlord shall not recapture the Premises and this Lease
shall continue in full force and effect as if Tenant had not requested
▇▇▇▇▇▇▇▇'s consent to an assignment or subletting, or applicable portion
thereof in lieu of giving its consent by notice given to Tenant within
twenty (20) days after receipt of ▇▇▇▇▇▇'s written request for assignment
or subletting. Such recapture shall terminate this Lease as to the
applicable space effective on the prospective date of assignment or
subletting, which shall be the last day of a calendar month and not
earlier than sixty (60) days after receipt of ▇▇▇▇▇▇'s request hereunder.
In the event that Landlord shall not elect to recapture and shall
thereafter give its consent, Tenant shall pay Landlord a reasonable fee,
not to exceed $500.00, to reimburse Landlord for processing costs
incurred in connection with such consent. For purposes of this Lease, any
corporate or partnership dissolution, liquidation or merger, and any
transfer of the corporate shares or general partnership interests holding
a majority of the voting rights in Tenant, whether in a single or any
number of transactions cumulatively, or any assignment or transfer by
operation of law shall be considered an "assignment" of this Lease
requiring Landlord's prior consent and otherwise subject to the
provisions of this subsection.
B. Notwithstanding any permitted assignment or subletting, Tenant shall
at all times remain directly, primarily and fully responsible and liable
for the payment of the rent herein as specified and for compliance with
all of its other obligations under the terms, provisions and covenants of
this Lease. Upon the occurrence of an "event of default" as hereinafter
defined, if the Premises or any part thereof are then assigned or sublet,
Landlord, in addition to any other remedies herein provided, or provided
by law, may at its option collect directly from such assignee or
subtenant all rents becoming due to Tenant under such assignment,
transfer of sublease and apply such rent against any sums due to Landlord
from Tenant hereunder, and no such collection shall be construed to
constitute a novation or a release of Tenant from the further performance
of ▇▇▇▇▇▇'s obligations hereunder.
13. INSURANCE, FIRE AND CASUALTY DAMAGE.
▇. ▇▇▇▇▇▇▇▇ agrees to maintain insurance covering the building of which
the Premises are a part in an amount not less than eighty percent (80%)
(or such greater percentage as may be necessary to comply with the
provisions of any co-insurance clauses of the policy) of the "replacement
cost" thereof as such term is defined in the Replacement Cost Endorsement
to be attached thereto, insuring against the perils of Fire, Lightning,
Extended Coverage, Vandalism and Malicious Mischief, extended by Special
Extended
Coverage Endorsement to insure against all other Risks of Direct Physical
Loss, such coverages and endorsements to be as defined, provided and
limited in the standard bureau form prescribed by the insurance
regulatory authority for the State in which the Premises are situated by
use by insurance companies admitted in such state for the writing of such
insurance on risks located within such state. Subject to the provisions
of subparagraph 13, C, D, E below, such insurance shall be for the sole
benefit of Landlord and under its sole control. In the event the
Insurance policy shall contain a deductible, Tenant shall be liable for
and pay any deductible withheld from insurance proceeds or payable under
the terms of the insurance policy in the event of a claim or insured loss
thereunder.
▇. ▇▇▇▇▇▇ agrees to pay, its proportionate share of Landlord's cost of
carrying fire and extended coverage insurance ("Insurance") on the
building. During each month of the term of this Lease, Tenant shall make
a monthly escrow deposit with Landlord equal to one-twelfth of its
proportionate share of the insurance on the buildings and grounds which
will be due and payable for that particular year. Tenant authorizes
Landlord to use the funds deposited by him with Landlord under this
paragraph to pay the cost of such Insurance. Each Insurance Escrow
Payment shall be due and payable, as additional rent, at the same time
and manner of the payment of the monthly rental as provided herein. The
initial share of the estimated insurance for the year in question, and
the monthly Insurance Escrow Payment is subject to increase or decrease
as determined by Landlord to reflect an accurate monthly escrow of
Tenant's estimated proportionate share of this insurance. The Insurance
Escrow Payment account of Tenant shall be reconciled annually. If the
Tenant's total insurance Escrow Payments are less than Tenant's actual
pro rata share of the insurance, Tenant shall pay to Landlord upon demand
the difference; if the total Insurance Escrow Payments of Tenant are more
than Tenant's actual pro rata share of the Insurance, Landlord shall
promptly refund the balance of such excess to Tenant and Insurance.
Tenant's cost of insurance shall be computed by multiplying the cost of
insurance by a fraction, the numerator of which shall he the number of
gross leasable square feet of floor space in the Premises and the
denominator of which shall be the total applicable gross leasable square
footage. The amount of the initial monthly Insurance Escrow Payment will
be as specified in the Basic lease Information.
C. If the building, of which the Premises are a part, should be damaged
or destroyed by fire, tornado or other casualty, Tenant shall give
immediate written notice thereof to Landlord.
D. If the building, of which the Premises are a part, should be totally
destroyed by fire, tornado or other casualty, or if it should be so
damaged thereby that rebuilding or repairs cannot in Landlord's
estimation be completed within two hundred (200) days after the date upon
which Landlord is notified by Tenant of such damage, this Lease shall
terminate and the rent shall be abated during the unexpired portion of
this Lease, effective or if adequate insurance proceeds are for any
reason unavailable, upon the date of the occurrence of such damage
provided that rent shall not ▇▇▇▇▇ if the casualty was caused by the
negligence or intentional misconduct of Tenant. Landlord shall give
notice to Tenant in writing of its determination to terminate this Lease
within sixty (60) days following the date of the occurrence of such
damage.
E. If the building, of which the Premises are a part, should be damaged
by any peril covered by the insurance to be provided by Landlord under
subparagraph 13(A) above, but only to such extent that rebuilding of
repairs can in Landlord's estimation be completed within two hundred
(200) days after the date upon which Landlord is notified by Tenant of
such damage, and adequate insurance proceeds to restore are available
this Lease shall not terminate, and Landlord shall at its sole cost and
expense thereupon proceed with reasonable diligence to rebuild and repair
such building to substantially the condition in which it existed prior to
such damage, except that Landlord shall not be required to rebuild,
repair or replace any part of the partition, fixtures, additions and
other improvements which may have been placed in, or about the Premises
by the Tenant. If the Premises are untenantable in whole or in part
following such damage, the rent payable hereunder during the period in
which they are untenantable shall be reduced to such extent as may be
fair and reasonable "under all of the circumstances" (provided that rent
will not ▇▇▇▇▇ if the casualty was caused by the negligence or
intentional misconduct of Tenant). In the event that Landlord shall fail
to complete such repairs and rebuilding within two hundred (200) days
after the date upon which Landlord is notified by Tenant of such damage,
Tenant may at its option terminate this Lease by delivering written
notice of termination Tenant's exclusive remedy, whereupon all rights and
obligations hereunder shall cease and terminate.
F. Notwithstanding anything herein to the contrary, in the event the
holder of any indebtedness secured by a mortgage or deed of trust,
covering the Premises requires that the insurance proceeds be applied to
such indebtedness, then Landlord shall have the right to terminate this
Lease by delivering written notice of termination to Tenant within
fifteen (15) days after such requirement is made by any such holder,
whereupon all rights and obligations hereunder shall cease and terminate.
G. Each of Landlord and Tenant hereby releases the other from any loss or
damage to property caused by fire or any other perils insured through or
under them by way of subrogation or otherwise for any loss or
damage to property caused by fire or any other perils insured in policies
of insurance covering such property, even if such loss or damage shall
have been caused by the fault or negligence of the other party, or anyone
for whom such party may be responsible; provided however, that this
release shall be applicable and in force and effect only with respect to
loss or damage occurring during such times as the releasor's policies
shall contain a clause or endorsement to the effect that any such release
shall not adversely affect or impair said policies or prejudice the right
of the releasor to recover thereunder and then only to the extent of the
insurance proceeds payable under such policies. Each of the Landlord and
▇▇▇▇▇▇ agrees that it will request its insurance carriers to include in
its policies such a clause or endorsement. If extra cost shall be charged
therefor, each party shall advise the other thereof and of the amount of
the extra cost, and the other party, at its election, may pay the same,
but shall not be obligated to do so.
14. LIABILITY. Landlord shall not be liable to Tenant or Tenant's employees,
agents, servants, guests, invitees of visitors, or to any other person
whomsoever, for any injury to person or damage to property on or about
the Premises, resulting from and/or caused in part or whole by the
negligence or misconduct of Tenant, its employees, agents, servants,
guests, invitees or visitors, or of any other person entering upon the
Premises, or caused by the building and improvements located on the
Premises becoming out of repair, or caused by leakage of gas, oil, water
or steam or by electricity emanating front the Premises, or due to any
cause whatsoever, and Tenant hereby covenants and agrees that it will at
all times indemnify and hold safe and harmless the property, the Landlord
(including without limitation the trustee and beneficiaries if Landlord
is a trust), Landlord's employees, agents, servants, guests, invitees and
visitors from any loss, liability, claims, suits, costs, expenses,
including without limitation attorney's fees and damages, both real and
alleged, arising out of any such damage or injury; except injury to
repair any part of the Premises which Landlord is obligated to repair and
maintain hereunder within a reasonable time after the receipt of written
notice from Tenant of needed repairs. ▇▇▇▇▇▇'s obligation to indemnify
Landlord under this Paragraph 14 included an obligation to indemnify for
losses resulting from death or injury to Tenant's employees, and Tenant
accordingly hereby waives any and all immunities it now has or hereafter
may have under any Industrial Insurance Act, or other worker's
compensation, disability benefit or other similar act which would
otherwise be applicable in the case of such a claim. Tenant shall procure
and maintain throughout the term of this Lease a policy or policies of
Insurance, at its sole cost and expense, insuring both Landlord and
Tenant against all claims, demands or actions arising out of or in
connection with: (i) the Premises; (ii) the condition of the Premises;
(iii) Tenant's operation in and maintenance and use of the Premises, and
(iv) Tenant's liability assumed under this Lease, the limits of such
polices, together with receipt evidencing payment of premiums therefor,
shall be delivered to Landlord prior to the Commencement Date of this
Lease. Not less that fifteen (15) days prior to the expiration date of
any such policies, certified copies of the renewals thereof (bearing
notations evidencing the payment of renewal premiums) shall be delivered
to Landlord. Such policies shall further provide that not less that
thirty (30) days written notice shall be given to Landlord before such
policy may be cancelled or changed to reduce insurance provided thereby.
Except to the extent Tenant has specifically waived its right of recovery
in this Lease in Sections 6, 11, 13G, 14, 19, 22, and 26, Landlord shall
indemnify and hold Tenant harmless against and from any and all claims
arising from any breach or default in the performance of any obligation
on Landlord's part to be performed under the terms of this Lease, or
arising from any intentional misconduct or gross negligence of Landlord,
or any officer, agent, employee, guest or invitee of Landlord, and from
all costs, attorney's fees and liabilities incurred in connection with
the defense of any such claim or any action or proceeding brought
thereon. In any action or proceeding brought against Tenant by reason of
such claim, Landlord, upon notice from Tenant, shall defend the same at
Landlord's expense by counsel reasonably satisfactory to Tenant. In no
event shall any indemnity in the Lease by Landlord apply to the extent of
the gross negligence or intentional misconduct of Tenant or its agents,
employees, contractors, or invitees.
14B. TENANTS INSURANCE.
1. Notwithstanding anything to the contrary set forth in this Lease,
Tenant covenants and agrees that during the term of this Lease (and any
renewal or extension thereof), Tenant, at its sole cost and expense,
shall obtain, maintain and keep in full force and effect:
(a) Comprehensive General Liability Insurance including Blanket
Contractual, Personal Injury, Broad Form Property Damage, Products
Liability, Completed Operations, Fire Legal Liability, Host Liquor Law
Liability (and if Tenant shall be operating a restaurant, tavern or other
establishment which sells or dispenses any drink or beverage containing
alcohol, Dram Shop Liability) and Owned, Non-owned and Hired automobile
coverages, naming Landlord and Tenant, any mortgagee of the Building and
any landlord under a lease of the property on which the Building is
located, and any other designee of Landlord, as insureds, with minimum
limits of $1,000,000 combined single limit for property damage and bodily
injury per occurrence for any and all claims for injury or damage to
persons or property or for the loss of life or property occurring upon,
in or about the Premises and the public portions of the Building arising
out of or in connection with any act or omission of Tenant, its
employees, agents, contractors, customers, and invitees.
(b) All Risk insurance including without limitation sprinkler leakage
and flood and earthquake (if flood and earthquake exposure exists) and
vandalism and malicious mischief on a 100% replacement cost basis
covering all contents, merchandise, inventory, equipment, floor
coverings, fixtures and improvements and such other portions of the
Premises which Landlord is not responsible for restoring. Tenant shall
apply all insurance proceeds attributable to any of the foregoing items
to the repair and restoration thereof. In addition, Tenant shall obtain
and keep in full force and effect during the term of this Lease business
interruption insurance with all risk perils and such other insurance in
such amounts as Landlord shall reasonably require.
(c) Workers' Compensation insurance as required by law and Employer's
Liability coverage for a minimum of $1,000,000 per occurrence.
2. Tenant covenants to comply with any and all rules and regulations
applicable to the Premises issued by the Board of Fire Underwriters or by
any other body hereinafter constituted exercising similar functions and
insurance companies writing policies covering the Premises. Tenant shall
pay all costs, expenses, claims, fines, penalties and damages imposed
because of failure of Tenant to comply with this Section (2) and agrees
to indemnify Landlord from all liability (including without limitation
attorney's fees) with reference thereto. Tenant shall, at its own cost
and expense, procure and maintain each and every permit, license,
certificate or other authorization and any renewals, extensions or
continuances of the same required in connection with lawful and proper
use of the Premises for Tenant's business. Tenant agrees to pay upon
demand as additional rent under this Lease any increase in the amount of
insurance premiums payable by Landlord for its insurance on the Building
and/or the underlying property ("Landlord's Insurance") over and above
the rate now in force that may be caused by ▇▇▇▇▇▇'s use or occupancy of
the Premises or any act or omission of Tenant, its agents, employees,
contractors or cancelled or suspended, then Tenant shall indemnify
Landlord against any liability, cost or expense which would have been
covered thereunder. All insurance obtained by Tenant hereunder shall be
under primary policies and Landlord's Insurance shall be excess and
noncontributory.
3. Tenant shall deposit a policy or policies of all such insurance, or an
approved certificate evidencing such insurance issued by duly authorized
agents of the carriers in question, with Landlord at least ten (10) days
before the Commencement Date and renewals of such policies and at least
thirty (30) days prior to the expiration of any existing policies. All
such policies shall provide that such insurance shall not be modified,
cancelled, reduced or allowed to lapse except upon thirty (30) days prior
written notice (by certified mail, return receipt requested) to Landlord
and all additional insureds.
4. All such policies shall (a) be written in form and substance
satisfactory to Landlord by an insurance company licensed and authorized
to do business in the state in which the Building is located and having a
rating of not less than "A - X" by A.M. Best Company's most recent
ratings report, and otherwise satisfactory to Landlord in all respects,
(b) contain a provision or endorsement that (i) no act of omission of
Tenant shall affect or limit the obligation of the insurer to pay the
amount of the loss solely responsible for the payment of all premiums and
that Landlord shall have no obligation to pay same notwithstanding that
Landlord is or may be named as an insured. Tenant's failure to provide
and keep in force the aforementioned insurance shall be regarded as a
material default hereunder, entitling Landlord to exercise any or all of
the remedies in the event of a default under this Lease. Carrying the
prescribed insurance shall in no way be construed as either a limitation
or satisfaction of the hold harmless or indemnity agreements contained in
this Lease. In the event Tenant shall not obtain any of the insurance
required to be obtained hereunder, Landlord shall have the right to
obtain such insurance on Tenant's behalf and Tenant shall pay to Landlord
the cost thereof upon demand as additional rent. Landlord shall have the
further right to review annually the form, substance and limits of all
Tenant's insurance required hereunder an Tenant shall adjust its
insurance and/or increase the limits thereof as Landlord shall deem
reasonably necessary.
14C. MISCELLANEOUS
Tenant will list Landlord, ▇▇▇▇▇▇▇▇'s lenders and property managers as
additional insureds on Tenant's insurance policies. Tenant is also
expressly required to maintain fire and extended coverage insurance for
the full replacement value of any alterations, additions or improvements
installed by or for it at the Premises.
15. CONDEMNATION.
A. If the whole or any substantial part of the Premises should be taken
for any public or quasi-public use under governmental law, ordinance or
regulation, or by right of eminent domain, or by private purchase in lieu
thereof and the taking would prevent or materially interfere with the use
of the Premises for the
purpose for which they are being used, this Lease shall terminate and the
rent shall be abated during the unexpired portion of the Lease, effective
when the physical take of said Premises shall occur.
B. If part of tine Premises shall be taken for any public or quasi-public
use under any governmental law, ordinance or regulation, or by right of
eminent domain, or by private purchase to lieu thereof, and this Lease is
not terminated as provided in the subparagraph above, this Lease shall
not terminate but the rent payable hereunder during the unexpired portion
of this Lease shall be reduced to such extent as may be fair and
reasonable under all of the circumstances.
C. In the event of any such taking or private purchase in lieu thereof,
Landlord shall be entitled to receive the entire award. Tenant shall be
entitled to make a claim in any condemnation proceeding which does not
reduce the amount of Landlord's award, for the value of any furniture,
furnishings and fixtures installed by and at the sole expense of Tenant.
16. HOLDING OVER. Tenant will, at the termination of this Lease by lapse of
time or otherwise, yield up immediate possession to Landlord. If Landlord
agrees in writing that Tenant may hold over after the expiration or
termination of this Lease, unless the parties hereto otherwise agree in
writing on the terms of such holding over, the hold over tenancy shall be
subject to termination by Landlord at any time upon not less than five
(5) days advance written notice, or by Tenant at any time upon not less
that thirty (30) days advance written notice, and all of the other terms
and provisions of this Lease shall be applicable during that period,
except that Tenant shall pay Landlord from time to time upon demand, as
rental for the period of any hold over, an amount equal to one and
one-half (1-1/2) the Base Rent in effect on the termination date, plus
all additional rental as defined herein, computed on a daily basis for
each day of the hold over period. No holding over by Tenant, whether with
or without consent of Landlord, shall operate to extend this Lease except
as otherwise expressly provided. The preceding provisions of this
paragraph 16 shall not be construed as Landlord's consent of Tenant to
hold over.
17. QUIET ENJOYMENT. Landlord covenants that it now has, or will acquire
before Tenant takes possession of the Premises, good fee or leasehold
title of the Premises, free and clear of all liens and encumbrances,
excepting only the lien for current taxes not yet due, such mortgage of
mortgages as are permitted by the terms of this Lease, zoning ordinances
and other building and fire ordinances and governmental regulations
relating to the use of such property, and easements, restrictions and
other conditions of record. In the event this Lease is a sublease, then
▇▇▇▇▇▇ agrees to take the Premises subject to the provisions of the prior
leases. Landlord represents and warrants that it has full right and
authority to enter into this Lease and that Tenant, upon paying the
rental herein set forth, and performing its other covenants and
agreements herein set forth, shall peaceably and quietly have, hold and
enjoy the Premises for the term hereof will without hindrance or
molestation from Landlord, subject to the terms and provisions of this
Lease.
18. EVENTS OF DEFAULT. The following events shall be deemed to be events of
default by Tenant under this Lease:
A. Tenant shall fail to pay any installment of the rent herein reserved
when due, of any payment with respect to taxes hereunder when due, or any
other payment or reimbursement to Landlord required herein when due, and
such failure shall continue for a period of five (5) days from the date
such payment was due.
B. Tenant shall become insolvent, or shall make a transfer in fraud of
creditors, of shall make an assignment for the benefit of creditors.
C. Tenant shall file a petition under any section or chapter of the
National Bankruptcy Act, as amended, or under any similar law or statute
of the United States or any State thereof; or Tenant shall be adjudged
bankrupt or insolvent in proceedings filed against Tenant thereunder.
D. A receiver or trustee shall be appointed for all or substantially all
of the assets of Tenant.
E. Tenant shall desert or vacate any substantial portion of the Premises.
F. Tenant shall fail to comply with any term, provision or covenant of
this Lease (other than the foregoing in this Paragraph 18), and shall not
cure such failure within thirty (30) days after written notice thereof to
Tenant.
19. REMEDIES. Upon the occurrence of any such events of default described in
Paragraph 18 hereof, Landlord shall have the option to pursue any one or
more of the following remedies without any notice or demand whatsoever.
A. Landlord may accelerate all rent payments due hereunder which shall
then become immediately due and payable.
B. Terminate this Lease, in which event ▇▇▇▇▇▇ shall immediately
surrender the Premises to Landlord, and if Tenant fails so to do,
Landlord 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 Tenant and any other person who may be
occupying such Premises or any part thereof, by force if necessary,
without being liable for prosecution or any claim of damages therefor,
and ▇▇▇▇▇▇ agrees to pay to Landlord on demand the amount of all loss and
damage which Landlord may suffer by reason of such termination, whether
through inability to relet the Premises on satisfactory terms or
otherwise.
C. Enter upon and take possession of the Premises and expel or remove
Tenant and any other person who may be occupying such Premises or any
pact thereof, by force if necessary, without being liable for prosecution
or any claim for damages therefor, and relet the Premises for such terms
ending before, on or after the expiration date of the Lease Term, at such
rentals and upon such other conditions (including concessions and prior
occupancy periods) as Landlord in its sole discretion may determine, and
receive the rent therefor; and the Tenant agrees to pay to the Landlord
on demand any deficiency that may arise by reason of such reletting.
Landlord shall have no obligation to relet the Premises or any part
thereof and shall not be liable for refusal or failure to relet or in the
event of reletting the Premises at a rental in excess of that agreed to
be paid by Tenant pursuant to the terms of this Lease, Landlord and
Tenant each mutually agree that Tenant shall not be entitled, under any
circumstances, to such excess rental, and Tenant does hereby specifically
waive any claim to such excess rental.
D. Enter upon the Premises, by force if necessary, without being liable
for prosecution or any claim for damages therefor, and do whatever Tenant
is obligated to do under the terms of this Lease; and ▇▇▇▇▇▇ agrees to
reimburse Landlord on demand for any expenses which Landlord may incur in
this effecting compliance with ▇▇▇▇▇▇'s obligations under this Lease, and
▇▇▇▇▇▇ further agrees that Landlord shall not be liable for any damages
resulting to the Tenant from such action, whether caused by the
negligence of Landlord or otherwise.
E. Whether or not Landlord retakes possession or relets the Premises,
Landlord shall have the right to recover unpaid rent and all damages
caused by ▇▇▇▇▇▇'s default, including attorney's fees. Damage shall
include, without limitation, all rents lost, all legal expenses and other
related costs incurred by Landlord following Tenant's default, all costs
incurred by Landlord in restoring the Premises to good order and
condition, or in remodeling, renovating or otherwise preparing the
Premises for reletting, all costs (including without limitation any
brokerage commissions and the value of Landlord's other rights and
remedies hereunder or at law and shall not be construed as liquidated
damages or as limiting Landlord's remedies in any manner.
F. In the event Tenant fails to pay any installment of rent, additional
rent or other charges hereunder within five (5) business days after
written notice from Landlord that such amount is overdue, to help defray
the additional cost to Landlord for processing such late payments Tenant
shall pay to Landlord on demand a late charge in all amount equal to five
(5%) of such installment; and the failure to pay such amount within ten
(10) days after demand therefor shall be an event of default hereunder.
The provision for such late charge shall be in addition to all of
Landlord's other rights and remedies hereunder or at law and shall not be
construed as liquidated damages or as limiting Landlord's remedies in any
manner.
G. Pursuit of any of the foregoing remedies shall not preclude pursuit of
any of the other remedies herein provided or any other remedies provided
by law, such remedies being cumulative and non-exclusive, nor shall
pursuit of any remedy herein provided constitute a forfeiture or waiver
of any rent due to a Landlord hereunder or of any damages accruing to a
Landlord by reason of the violation of any of the terms, provisions and
covenants herein contained. No act or thing done by the Landlord or its
agents during the Lease Term hereby granted shall be deemed a termination
of this Lease or an acceptance of the surrender of the Premises, and no
agreement to terminate this Lease or to accept a surrender of said
Premises shall be valid unless in writing signed by Landlord. No waiver
by Landlord or Tenant of any violation or breach of any of the terms,
provisions and covenants herein contained shall be deemed or construed to
constitute a waiver of any other violations or breach of any of the
terms, provisions and covenants herein contained. ▇▇▇▇▇▇▇▇'s acceptance
of the payment of rental or other payments hereunder after the occurrence
of an event of default shall not be construed as a waiver of such
default, unless Landlord notifies Tenant in writing. Forbearance by
Landlord or Tenant to enforce one or more of the remedies herein provided
upon an event of default shall not be deemed or construed to constitute a
waiver of such default or of Landlord's
or ▇▇▇▇▇▇'s right to enforce any such remedies with respect to such
default or any subsequent default. If, on account of any breach or
default by Tenant in Tenant's obligations under the terms and conditions
of this Lease, it shall become necessary or appropriate for Landlord to
employ or consult with an attorney concerning or to enforce or defend any
of Landlord's rights or remedies hereunder, ▇▇▇▇▇▇ agrees to pay any
reasonable attorney's fees so incurred. In the event of any litigation
concerning this lease the substantially prevailing party shall be
reimbursed its attorney's fees and costs by the substantially prevailing
party.
20. LANDLORD'S LIEN. In addition to any statutory lien for rent in Landlord's
favor, Landlord shall have and Tenant hereby grants to Landlord a
continuing security interest for all rentals, and other sums of money
becoming due hereunder from Tenant, upon all goods, wares, equipment,
fixtures, furniture, inventory, accounts, contract rights, chattel paper
and other, personal property of Tenant situated on the Premises, and such
property shall not be removed therefrom without the consent of Landlord
until all arrearages in rent as well as any and all other sums of money
then due to Landlord hereunder shall first have been paid and discharged.
In the event of a default under this Lease, Landlord shall have, in
addition to any other remedies provided herein or by law, all rights and
remedies under the Uniform Commercial Code, including without limitation
the right to sell the property described in this Paragraph 20 at public
or private sale. Tenant hereby agrees to execute such financing
statements and other instruments necessary or desirable in Landlord's
discretion to perfect the security interest hereby created. Any statutory
lien for rent is not hereby waived, the express contractual lien herein
granted being in addition and supplementary thereto.
21. MORTGAGES. Tenant accepts this Lease subject and subordinate to any
ground leases, mortgage(s) and/or deed(s) of trust now or at any time
hereafter constituting a lien or charge upon the Premises or the
improvements situated thereon, provided, however, that if the mortgagee,
trustee, or holder of any such mortgage or deed of trust elects to have
Tenant's interest in this Lease superior to any such instrument, then, by
notice to Tenant from such mortgagee, trustee or holder, this Lease shall
be deemed superior to such lien, whether this Lease was executed before
or after said mortgage or deed of trust. Tenant shall at any time
hereafter on demand execute any instruments, releases or other documents
which may be required by any mortgage for the purpose of subjecting and
subordinating this Lease to the lien of any such mortgage. If any
proceedings are brought for foreclosure, or in the event of the exercise
of the power of sale under any mortgage or deed of trust made by Landlord
covering the Premises or in the event of a transfer in lieu of
foreclosure, Tenant shall attorn to the mortgagee, beneficiary, or
purchaser/assignee and recognize the same as the new landlord under this
Lease.
22. LANDLORD'S DEFAULT. Landlord shall not be in default unless Landlord
fails, to perform obligations required of Landlord within a reasonable
time, but in no event later than thirty (30) days after written notice by
Tenant to Landlord and to the holder of any first mortgage or deed of
trust covering the Premises whose name and address shall have theretofore
been furnished to Tenant in writing and specifying how Landlord has
failed to perform such obligations and the acts required to cure the
same; provided, however, that if the nature of Landlord's obligation is
such that more than thirty (30) days are required for performance,
Landlord shall not be in default if Landlord commences performance within
such thirty (30) day period and thereafter diligently prosecutes the same
to completion. Tenant shall have the right to recover its actual damages
caused by an uncured default of Landlord under this Lease. In no event
shall Tenant have the right to offset damages against rent or to
terminate this Lease as a result of ▇▇▇▇▇▇▇▇'s default, or to seek
consequential of punitive damages against Landlord for a default
hereunder.
23. MECHANICS LIEN. Tenant shall have no authority, express or implied, to
create or place any lien or encumbrance of any kind or nature whatsoever
upon, or in any manner to bind, the interest of Landlord in the Premises
or to charge the rentals payable hereunder for any claim in favor of any
person dealing with ▇▇▇▇▇▇, including those who may furnish materials or
perform labor for any construction or repair, and each such claim shall
affect and each such lien shall attach to, if at all, only the leasehold
interest granted to Tenant by this instrument. Tenant covenants and
agrees that it will pay or cause to be paid all sums legally due and
payable by it on account of any labor performed or materials furnished in
connection with any work performed on the Premises on which any lien is
or can be validly and legally asserted against its leasehold interest in
the Premises or the improvements thereon and that it will save and hold
Landlord harmless from any and all loss, cost or expense based on or
arising out of asserted claims or liens against the leasehold estate or
against the right, title and interest of the Landlord in the Premises or
under the terms of this Lease.
24. NOTICES. Each provision of this instrument or of any applicable
governmental laws, ordinances, regulations and other requirements with
reference to the sending, mailing or delivery of any notice or the making
of any payment by Landlord to Tenant or with reference to the sending,
mailing or delivery of any
notice or the making of any payment Tenant to Landlord shall be deemed to
be compiled with when and if the following steps are taken:
A. All rent and outer payments required to be made by Tenant to Landlord
hereunder shall be payable to Landlord at the address hereinbelow set
forth or at such other address as Landlord may specify from time to time
by written notice delivered in accordance herewith. Tenant's obligation
to pay rent and any other amounts to Landlord under the terms of this
Lease shall not be deemed satisfied until such rent and other amounts
have been actually received by Landlord.
B. All payments required to be made by Landlord to Tenant hereunder shall
be payable to Tenant at the address hereinbelow set forth, or at such
other address within the continental United States as Tenant may specify
from time to time by written notice delivered in accordance herewith.
C. Any notice or document required or permitted to be delivered hereunder
shall be deemed to be delivered whether actually received or not three
business days after deposit in the United States mail, postage prepaid,
Certified or Registered Mail, addressed to the parties hereto at the
respective addresses set out below, or at such other address as they have
thereto specified by written notice delivered in accordance herewith:
LANDLORD: TENANT:
New York Life Insurance Company Pure Water Corporation
c/o ▇▇▇▇▇▇▇▇ ▇▇▇▇ COMPANY an Aqua Source Company,
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
If and when included within the term "Landlord", as used in this
instrument, there are more than one person, firm or corporation, all
shall jointly arrange among themselves for their joint execution of such
a notice specifying some individual at some specific address for the
receipt of notices and payments to Landlord; if and when included within
the term "Tenant", as used in this instrument, there are more than one
person, firm or corporation, all shall jointly arrange among themselves
for their joint execution of such a notice specifying some individual at
some specific address within the continental United States for the
receipt of notices and payments to Tenant. All parties included within
the terms "Landlord" and "Tenant", respectively, shall be bound by
notices given in accordance with the provisions of this paragraph to the
same effect as if each had received such notice
25. MISCELLANEOUS.
A. Words of any gender used in this Lease shall be held and construed to
include any other gender, and words in the singular number shall be held
to include the plural, unless the context otherwise requires.
B. The terms, provisions and covenants and conditions contained in this
Lease shall apply to, insure the benefit of, and be binding upon, the
parties hereto and upon their respective heirs, legal representatives,
successors and permitted assigns, except as otherwise herein expressly
provided. In the event of any sale of the subject real estate by
Landlord, Landlord shall automatically be released from all liability
under this Lease arising out of any act, occurrence or omission occurring
after the consummation of such sale. Landlord shall have the right to
assign any of its rights and obligations under this Lease. Each party
agrees to furnish to the other, promptly upon demand, a corporate
resolution, proof of due authorization by partners, or other appropriate
documentation evidencing the due authorization of such party to enter
into this Lease.
C. The captions inserted in this Lease are for convenience only and in no
way define, limit or otherwise describe the scope of intent of this
Lease, or any provision hereof, or in any way affect the interpretation
of this Lease.
▇. ▇▇▇▇▇▇ agrees from time to time within ten (10) days after request of
Landlord, to deliver to Landlord, or Landlord's designee, an estoppel
certificate stating that this Lease is full force and effect, the date to
which rent has been paid, the unexpired term of this Lease and such other
matters pertaining to this Lease as may be requested by Landlord. It is
understood and agreed that ▇▇▇▇▇▇'s obligation to furnish such estoppel
certificates in a timely fashion is a material inducement for Landlord's
execution of this Lease
E. This Lease may not be altered, changed of amended except by an
instrument in willing signed by both parties hereto.
F. All obligations of Tenant hereunder not fully performed as of the
expiration or earlier termination of the term of this Lease shall survive
the expiration or earlier termination of the Term hereof, including
without limitation all payment obligations with respect to taxes and
insurance and all obligations concerning the condition of the Premises.
Upon the expiration or earlier termination of the Term hereof, and prior
to Tenant vacating the Premises, Tenant shall pay to Landlord any amount
reasonably estimated by Landlord as necessary to put the Premises,
including without limitation all heating and air-conditioning systems and
equipment therein, in good condition and repair pursuant to Paragraph
10(B) hereof. Tenant shall also, prior to vacating the Premises, pay to
Landlord the amount, as estimated by Landlord, of ▇▇▇▇▇▇'s obligation
hereunder for real estate taxes and insurance premiums for the year in
which the Lease expires or terminates. All such amounts shall be used and
held by Landlord for payment of such obligations of Tenant hereunder,
with ▇▇▇▇▇▇ being liable for any additional costs therefor upon demand by
Landlord, or with any excess to be returned to Tenant after all such
obligations have been determined and satisfied, as the case may be. Any
security deposit held by Landlord shall he credited against the amount
payable by Tenant under this Paragraph 25(F).
G. If any clause or provision of this Lease is illegal, invalid or
unenforceable under present of future laws effective during the Term of
this Lease, then and in that event, it is the intention of the parties
hereto that the remainder of this Lease shall not be affected thereby,
and it is also the intention of the parties to this Lease that in lieu of
each clause or provision of this Lease that is illegal, invalid or
unenforceable clause or provision as may be possible and be legal, valid
and enforceable.
H. Because the Premises are on the open market and are presently being
shown, this Lease shall be treated as an offer with the Premises being
subject to prior lease and such offer subject to withdrawal or
nonacceptance by Landlord or to other use of the Premises without notice,
and this Lease shall not he valid or binding unless and until accepted by
Landlord in writing and a fully executed copy delivered to both parties
hereto.
I. All references in this Lease to "the date hereof" or similar
references shall be deemed to refer to the last date, in point of time,
on which all parties hereto have executed this Lease.
J. During the term of this Lease and any subsequent option periods,
Landlord shall have the right to request and obtain Tenant's current
financial statements with reasonable advance notice. Tenant shall comply
with ▇▇▇▇▇▇▇▇'s request for financial statements in a reasonable time
frame not to exceed thirty (30) days from the date of request.
26. LIABILITY OF LANDLORD. ▇▇▇▇▇▇ agrees that no trustee, officer, employee,
agent or individual partner of Landlord, (or its constituent entitles),
shall be personally liable for any obligation of Landlord hereunder, and
that Tenant must look solely to the interests of Landlord, or its
constituent entitles in the subject real estate, for the enforcement of
any claims against Landlord arising hereunder.
27. TIME. Time is of the essence of this Lease for each and all of its
provisions in which ▇▇▇▇▇▇'s performance is a factor.
28. NO RECORDATION. Tenant shall not, without the consent of Landlord, record
this Lease or any "short form" memorandum thereof.
29. ADDITIONAL PROVISIONS.
Paragraphs 30-34, attached hereto are by this reference incorporated
herein.
TENANT:
PURE WATER CORPORATION,
an Aqua Source Company
a Delaware corporation
BY: ___________________________________
ITS: __________________________________
LANDLORD:
NEW YORK LIFE INSURANCE COMPANY
BY: ___________________________________
ITS: __________________________________
STATE OF ____________________________________)
SS
COUNTY OF____________________________________)
BE IT REMEMBERED, that on this __________day of ________________________,
19____, before me, the undersigned a Notary Public in and for said County and
State, duly commissioned an sworn, personally appeared
_________________________________ known to me to be the person who signed as
_______________________________ of ________________________________________, the
corporation that executed the within and foregoing instrument, and acknowledged
said instrument to be the free and voluntary act and deed of said corporation
for the uses and purposes therein mentioned, and on oath stated that he/she was
duly elected, qualified and acting as officer of the corporation, that he/she
was authorized to execute said instrument and that the seal affixed, if any, is
the corporate seal of said corporation.
IN WITNESS WHEREOF, I have hereunto set my hand and official seal the
day and year first above written.
_____________________________________________
Notary Public for ___________________________
Residing at _________________________________
My Commission Expires _______________________
STATE OF ____________________________________)
SS
COUNTY OF____________________________________)
BE IT REMEMBERED, that on this ______day of _____________________, 19_________,
before me, the undersigned a Notary Public in and for said County and State,
duly commissioned and sworn, personally appeared ___________________________
known to me to be the person who signed as _____________________________________
of _________________________________the corporation that executed the within and
foregoing instrument, and acknowledged said instrument to be the free and
voluntary act and deed of said corporation for the uses and purposes therein
mentioned, and on oath stated that he/she was duly elected, qualified and acting
as an officer of the corporation, that he/she was authorized to execute said
instrument and that the seal affixed, if any is the corporate seal of said
corporation.
IN WITNESS WHEREOF, I have hereunto set my hand and official seal the
day and year first above written.
_____________________________________________
Notary Public for ___________________________
Residing at__________________________________
My Commission Expires________________________
GUARANTY OF LEASE
THIS GUARANTY OF LEASE is attached to and is hereby made a part of that
certain Lease dated July 8, 1999 between NEW YORK LIFE INSURANCE COMPANY
("Landlord"), and PURE WATER CORPORATION an AquaSource Company, a Delaware
corporation ("Tenant").
FOR VALUE RECEIVED and in consideration of and as an inducement to
Landlord entering into this Lease, the undersigned guarantor ("Guarantor"),
AquaSource, Inc., unconditionally and continuously guarantees to Landlord, its
successors and assigns, and acknowledging that Guarantor receives an economic
benefit from ▇▇▇▇▇▇'s entering into this Lease, the full and timely performance
and observance by Tenant of all the terms and conditions of the Lease to be
performed and observed by Tenant.
This Guaranty and the obligations of Guarantor hereunder shall not be
terminated or impaired by reason of the granting by Landlord of any indulgences
to Tenant or the assertion by Landlord against Tenant of any of Landlord's
rights or remedies under the Lease, or by the relief of Tenant from any of
Tenant's obligations under the lease by operation of law or otherwise, whether
or not Guarantor has received notice of same. Guarantor waives all suretyship
defences and waives notice of any breach by ▇▇▇▇▇▇.
This Guaranty shall continue in full force and effect as to any
renewal, amendment, modification, extension, assignment or transfer of the Lease
or any subletting of the Lease premises, whether or not Guarantor shall have
received notice of or consented to the same. The liability of Guarantor under
this Guaranty is primary and absolute, and Landlord may at its opinion proceed
against guarantor without proceeding against Tenant. Any action against
Guarantor may be brought in the county in which the Lease premises are located,
or in King County, Washington, at Landlord's option.
Landlord's delay or failure to insist upon the strict performance or
observance of any obligation of Tenant under the Lease or to execute any right
or remedy available under the Lease or at law or in equity, shall not be
construed to be a waiver of Landlord's prerogative to insist upon such strict
performance or observance or to exercise any such right or remedy. Receipt by
Landlord of rent or other payment with knowledge of a breach of any term or
condition of the Lease shall not be construed to be a waiver of such breach.
The liability of Guarantor hereunder shall not be affected or limited
by: the release or discharge of Tenant in any creditors', receivership,
bankruptcy or other proceedings; the impairment, limitation or modification of
the liability of the Tenant or the estate of the Tenant in bankruptcy, or of any
remedy for the enforcement of Tenant's said liability under the Lease, resulting
from the operation of any present or future provision of the federal bankruptcy
laws or other statutes or from the decision in any court; the rejection or
disaffirmance of the Lease in any such proceedings; any disability or other
defence of Tenant; or the cessation, from any cause whatsoever, of the liability
of the Tenant.
Until all terms, conditions and agreements of the Lease are fully
performed and observed by Tenant; Guarantor hereby waives the right to enforce
any claim, right or remedy which Guarantor now has or hereafter shall have
against Tenant by reason of any one or more payments or acts of performance in
compliance with the obligations of Guarantor hereunder, and Guarantor hereby
subordinates any liability or indebtedness of Tenant now or hereafter held by
Guarantor to the obligations of Tenant to Landlord under the Lease.
This Guaranty shall inure to the benefit of the Landlord, its
affiliates, successors and assigns, and shall be binding upon the successors and
assigns of Guarantor.
This Guaranty is irrevocable and may not be changed, affected,
discharged or terminated other than by an agreement in writing signed by
Guarantor and Landlord.
Guarantor shall pay all costs and expenses paid or incurred by Landlord
in enforcing either the Lease or this Guaranty, including court costs and a
reasonable amount for legal services performed by counsel, whether employed or
retained by ▇▇▇▇▇▇▇▇.
DATED this ___day of ______________, 19___. AquaSource, Inc.
_______________________________
(signature)
_______________________________
(Name - PLEASE PRINT)
CORPORATE ADDRESS
___________________________________
___________________________________
___________________________________
CORPORATE TELEPHONE:
___________________________________
AQUASOURCE LNC.
________________________________________________________________________________
CERTIFICATE OF THE SECRETARY
The undersigned, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, does hereby certify that she is Corporate
Secretary of AquaSource, Inc., a Delaware corporation, and does hereby further
certify that attached is an excerpt from the Minutes of a Meeting of the Board
of Directors of the Company duly called and held on August 19, 1999, at which
meeting a quorum was present and acting throughout; none of the corporate action
reported in said excerpt has been modified or rescinded.
WITNESS the due execution hereof this 19th day of August, 1999
_______________________________________
(SEAL) ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Corporate Secretary
EXCERPT FROM THE MINUTES OF A
MEETING OF THE BOARD OF DIRECTORS
OF AQUASOURCE, INC.
HELD ON AUGUST 19, 1999
Approval of a Guarantee of Pure Water Corporation Lease
▇▇. ▇▇▇▇▇▇▇▇▇ explained to the Board that Pure Water Corporation,
located in Seattle, Washington, was moving into a new facility under very
favorable lease terms (on a gross basis, 48 cents per square foot per month). A
total of 75,940 square feet will be leased for seven years at an annual cost of
about $440,000 per year. ▇▇. ▇▇▇▇▇▇▇▇▇ explained that a guarantee from
AquaSource is necessary as part of the lease in order to obtain these lease
terms and he recommended that the Board approve such a guarantee.
After questions and discussion and on motion duly made and seconded,
the following resolutions were unanimously adopted:
RESOLVED, That the Company is authorized to enter into the Guaranty of
Lease Agreement, as part of the Lease Between New York Life Insurance Company
and Pure Water Corporation, substantially under the terms presented to the Board
at this meeting; and
FURTHER RESOLVED, That each of the proper officers of the Company is
authorized, in the name and on behalf of the Company, to do and perform all acts
and execute and deliver all such documents and other instruments as each of them
may deem necessary or appropriate in order to fully effectuate the purpose of
the foregoing resolution.
GUARANTY OF LEASE
THIS GUARANTY OF LEASE is attached to and is hereby made a part of that
certain Lease, dated July 8, 1999, between NEW YORK LIFE INSURANCE COMPANY
("Landlord"), and PURE WATER CORPORATION, an AquaSource Company, a Delaware
corporation ("Tenant").
FOR VALUE RECEIVED and in consideration of and as an inducement to Landlord
entering into this Lease, the undersigned guarantor ("Guarantor"), AquaSource,
Inc., unconditionally and continuously guarantees to Landlord, its successors
and assigns, and acknowledging that Guarantor receives an economic benefit from
▇▇▇▇▇▇'s entering into this Lease, the full and timely performance and
observance by Tenant of all the terms and conditions of the Lease to be
performed and observed by Tenant.
This Guaranty and the obligations of Guarantor hereunder shall not be
terminated or impaired by reason of the granting by Landlord of any indulgences
to Tenant or the assertion by Landlord against Tenant of any of Landlord's
rights or remedies under the Lease, or by the relief of Tenant from any of
Tenant's obligations under the lease by operation of law or otherwise, whether
or not Guarantor has received notice of same. Guarantor waives all suretyship
defenses and waives notice of any breach by ▇▇▇▇▇▇.
This Guaranty shall continue in full force and effect as to any renewal,
amendment, modification, extension, assignment or transfer of the Lease or any
subletting of the Lease premises, whether or not Guarantor shall have received
notice of or consented to the same. The liability of Guarantor under this
Guaranty is primary and absolute, and Landlord may at its option proceed against
guarantor without proceeding against Tenant. Any action against Guarantor may be
brought in the county in which the Lease premises are located, or in King
County, Washington, at Landlord's option.
Landlord's delay or failure to insist upon the strict performance or
observance of any obligation of Tenant under this lease or to exercise any right
or remedy available under the Lease or at law of in equity, shall not be
construed to be a wavier of Landlord's prerogative to insist upon such strict
performance or observance or to exercise any such right or remedy. Receipt by
Landlord of rent or other payment with knowledge of a breach of any term or
condition of the Lease shall not be construed to be a waiver of such breech.
The liability of Guarantor hereunder shall not be affected of limited by:
the release or discharge of Tenant in any creditors', receivership, bankruptcy
or other proceedings; the impairment, limitation or modification of the
liability of the Tenant or the estate of the Tenant in bankruptcy, or of any
remedy for the enforcement of ▇▇▇▇▇▇'s said liability under the Lease, resulting
from, the operation of any present or future provision of the federal bankruptcy
laws or other, statutes or from the decision in any court; the rejection or
disaffirmance of the Lease in any such proceedings; any disability or other
defense of Tenant, or the cessation, from any cause whatsoever, of the liability
of the Tenant.
Until all the terms, conditions and agreements of the Lease are fully
performed and observed by Tenant, Guarantor hereby waives the right to enforce
any claim, right or remedy which Guarantor now has or hereafter shall have
against Tenant by reason of any one or more payments or acts of performance in
compliance with the obligations of Guarantor hereunder, and Guarantor hereby
subordinates any liability or indebtedness of Tenant now or hereafter held by
Guarantor to the obligations of Tenant to Landlord under the Lease.
This Guaranty shall inure to the benefit of the Landlord, its affiliates,
successors and assigns, and shall be binding upon the successors and assigns of
Guarantor.
This Guaranty is irrevocable and may not be changed, affected, discharged
of terminated other than by an agreement in writing signed by Guarantor and
Landlord.
Guarantor shall pay all costs and expenses paid or incurred by Landlord
in enforcing either the Lease or this Guaranty, including court costs and a
reasonable amount for legal services performed by counsel, whether employed or
retained by ▇▇▇▇▇▇▇▇.
DATED this ____day of _________________ , 1999. AquaSource,Inc
_______________________________
(Signature)
_______________________________
(Name - PLEASE PRINT)
CORPORATE ADDRESS;
_________________________________________
_________________________________________
CORPORATE TELEPHONE:
_________________________________________
ADDITIONAL PROVISIONS TO LEASE
July 8, 1999
NEW YORK LIFE INSURANCE COMPANY
as Landlord
and
PURE WATER CORPORATION, an AquaSource Company
a Delaware corporation,
as Tenant
________________________________________________________________________________
30. FREE RENT. Tenant shall not be required to pay the monthly base
rent for the period September 1, 1999 through December 31, 1999,
but will be responsible for its share of the monthly operating
expenses during this time, provided that this Lease does not
terminate prior to December 31, 2006. If for any reason this Lease
terminates prior to December 2006, Tenant shall be required to
promptly pay to Landlord, in addition to other charges that may be
due, four (4) month's base rent for the period September 1, 1999
through December 31, 1999.
31. RENT INCREASE. Effective September 1, 2002, the monthly base rent
as provided for in Paragraph 2 of the Lease shall be increased to
Thirty Two Thousand Six Hundred Fifty Four and No/100 ($32,654.00).
Effective September 1, 2005, the monthly base rent as provided for
in Paragraph 2 of the Lease shall be increased to Thirty Five
Thousand Six Hundred Ninety One and No/100 ($35,691.00).
32 OPTION TO EXTEND. While this lease is in full force and effect,
provided Tenant is not and has not been in default of any of the
terms, covenants and conditions thereof, Landlord grants to Tenant
one (1) option to extend the term of the Lease for a period of five
(5) years commencing upon the termination of the original Lease
term, exercisable by giving Landlord notice in writing not later
nine (9) months prior to the termination of the original lease
term. Such extension or renewal shall be on the same terms,
covenants and conditions as provided for in the original term
except that the monthly base rent during the extended term shall be
at the fair market rental then in effect on equivalent properties,
of equivalent size, in equivalent areas. However, in no event shall
the Monthly Base Rent during the Option Term be below that in
effect in the final full calendar month of the original term of the
Lease. In the event the demised Premises is sublet or assigned this
renewal option will be null and void and of no further effect.
33. TENANT IMPROVEMENTS. Landlord agrees to provide to Tenant a
Seventy-Five Thousand and no/100 Dollars ($75,000) tenant
improvement allowance so that Tenant may complete its improvements
to the Premises provided that Tenant completes tenant improvements
and submits invoices for the same to the Landlord on or before
December 31, 2000. Should Tenant not complete its tenant
improvements and/or submit invoices for the same to the Landlord on
or before December 31,2000, Landlord shall not be required to pay
the $75,000 tenant improvement allowance. Prior to Tenant
commencing work on these improvements, Tenant shall submit to
Landlord two (2) copies of plans detailing the design and plan of
improvements Landlord shall either approve or disapprove plans
within five (5) days and, if approved, return a signed, approved
copy to Tenant. In the event that the plans are not approved by
Landlord, Landlord shall inform Tenant of the reasons for such
disapproval and Tenant shall have five (5) days in which to submit
revised plans to Landlord for approval, which approval shall not be
unreasonably withheld or delayed. Tenant shall not unreasonably
refuse to satisfy any objections made by Landlord to said plans and
specifications. Any objections Tenant has to ▇▇▇▇▇▇▇▇'s objection
shall be submitted to Landlord in writing within said five (5) day
period. A failure of one party to give any notice to the other
party within such five (5) day period shall be deemed to constitute
approval of the plans and specifications or the objections thereto,
as appropriate.
Upon ▇▇▇▇▇▇▇▇'s approval of ▇▇▇▇▇▇'s plans, Tenant shall
promptly enter into a construction contract with a licensed, bonded
contractor. The construction of all improvements to be made on the
Premises shall be performed in a first-class, workmanlike manner
and in conformity with all applicable governmental laws,
ordinances, rules, orders, regulations, and other
EXHIBIT B
KENT EAST CORPORATE PARK
LEGAL DESCRIPTION
That portion of the South 1/2 of Northwest 1/4 and the North 1/2 of the
Southwest 1/4 of Section 7, Township 22 North, Range 5 East, ▇.▇., in ▇▇▇▇
County, Washington, being more particularly described as follows:
COMMENCING at the West 1/4 corner of said Section 7; thence S 89(degree)59'28" E
along the South line of said Northwest 1/4 a distance of 50.01 feet to a point
on the East line of a parcel conveyed to the City of Kent for 84TH AVENUE SOUTH
road purposes as recorded under Recording No. 9008061001 said point also being
the POINT OF BEGINNING; thence N 1(degree)15'05" E along said line 767.80 feet
to the North line of the South 767.62 feet of Government Lot 2 in said Section
7; thence ; 89(degree)59'28" E along said North line 447.76 feet to the East
line of the West 497.65 feet of said Government Lot 2; thence S 1(degree)15'05"
W along said East line 400.15 feet to the North line of the South 10 acres of
said Government Lot 2; thence S 89(degree)59'28" E along said North line 258.06
feet to the East line of the West 755.65 feet of said Government Lot 2; thence N
1(degree)15'05" E along said East line 400.15 feet to said North line of the
South 767.52 feet; thence S 89(degree)59'28" E along said North line 811.85 feet
to the Westerly line of a parcel conveyed to the State of Washington as recorded
under Recording No. 8406291616; thence Southerly along said line by the
following courses and distances: S 27(degree)02'29" E 222.77 feet; S
10(degree)57'58" E 30.41 feet; S 20(degree)42'36" E 95.02 feet; S
1(degree)42'05" W 125.20 feet; N 88(degree)29'46" E 13.61 feet to the Westerly
margin of a drainage ditch right-of-way condemned by King County Superior Court
Cause No. 32912 and as field located in February, 1990; thence Southerly along
said margin by the following courses and distances: S 4(degree)54'00" W 235.12
feet; S 13(degree)37'00" W 118.22 feet; S 23(degree)57'00" W 111.60 feet; S
20(degree)36'00" W 109.72 feet; S 14(degree)32'00" W 109.77 feet; S
12(degree)31'00" W 311.40 feet to the North line of a parcel conveyed to the
City of Kent for SOUTH 218TH STREET road purposes as recorded under Recording
No. 9008061002; thence S 89(degree)54'38" W along said line 307.74 feet to the
West line of TRACT 18 of ▇▇▇▇▇'▇ CLOVERDALE ADDITION TO KENT, as per plat
recorded in Volume 6 of Plats, Page 52, records of said King County; thence N
1(degree)14'10" E along said West line 388.47 feet to its intersection with the
Easterly extension of the South line of TRACT 10 of said Plat; thence S
89(degree)58'36" W along said extended line and along the South line of said
TRACT 10 a distance of 530.86 feet to the West line of the East 1 acre of TRACT
9 of said Plat; thence S 1(degree)18'03" W along said West line 243.49 feet to
the North line of a parcel conveyed to the City of Kent for SOUTH 218TH STREET
and 84TH AVENUE SOUTH road purposes as recorded under Recording No. 9008061003;
thence S 89(degree)56'39" W along said line 380.24 feet to the East line of The
West 244 feet of said TRACT 9; thence N 1(degree)15'40" E along said line 76.52
feet to the North line of the South 90 feet of said TRACT; thence N
89(degree)56'39" E along said line 14.00 feet to the East line of the West 258
feet of said TRACT; thence N 1(degree)15'40" E along said line 167.17 feet to
the North line of said TRACT; thence N 89(degree)58'36" E 18.00 feet to the East
line of the West 306 feet of said TRACT 10; thence N 1(degree)15'40" E along
said line 248.46 feet to the South line of the North 8.72 feet of said TRACT 10;
thence N 89(degree)59'28" W along said South line 256.06 feet to the East line
of said Parcel conveyed to the City of Kent as recorded under Recording No.
9008061001; thence N 1(degree)15'40" E along said East line 8.72 feet to the
POINT OF BEGINNING.
TOGETHER WITH that portion of the South 1/2 of the Northwest 1/4 and the North
1/2 of the Southwest 1/4 of Section 7, Township 22 North, Range 5 East, ▇.▇., in
▇▇▇▇ County, Washington, being more particularly described as follows:
COMMENCING at the West 1/4 corner of said Section 7; thence S 89(degree)59'28" E
along the South line of said Northwest 1/4 a distance of 1690.84 feet to a point
on the Easterly margin of a drainage ditch right-of-way condemned by King County
Superior Court Cause No. 32912 and as field located in February, 1990, said
point also being the POINT OF BEGINNING; thence Northerly along said margin the
following courses and distances: N 13(degree)37'00" E 83.72 feet; N
4(degree)54'00" E 239.83 feet to the Southerly line of a parcel conveyed to the
State of Washington as recorded under Recording No. 8406291616; thence leaving
said Easterly margin N 88(degree)29'46" E along said Southerly line 36.23 feet
to the Westerly margin of STATE ROUTE NO. 167 as conveyed to the State of
Washington as recorded under Recording No. 5335185; thence Southerly along said
Westerly margin by the following courses and distances: S 1(degree)30'14" E
463.44 feet; S 0(degree)59'52" E 172.05 feet to a point on a curve to the right
from which the center bears N 89(degree)58'21" W 3164.10 feet distant; thence
Southerly along said curve through a central angle of 5(degree)59'09" an arc
distance of 330.57 feet to the Northerly line of a parcel conveyed to the City
of Kent for SOUTH 218TH STREET road purposes as recorded under Recording No.
9008061002; thence leaving said Westerly margin and running along said Northerly
line the following courses and distances: S 89(degree)54'38" W 13.70 feet to a
point on a curve to the left from which the center bears S 53(degree)02'27" W
50.00 feet distant;
thence Westerly along said curve through a central angle of 106(degree)15'37" an
arc distance of 92.73 feet; thence S 89(degree)54'39" W 166.66 feet to the
Easterly margin of said drainage ditch right-of-way as field located in
February, 1990; thence leaving said Northerly line and running along said
Easterly margin by the following courses and distances: N 12(degree)31'00" E
305.37 feet; N 14(degree)32'00" E 108.00 feet; N 20(degree)36'00" E 107.67 feet;
N 23(degree)57'00" E 113.13 feet; N 13(degree)37'00" E 38.66 feet to the POINT
OF BEGINNING.
Revised December 6, 1990
90-007A
EXHIBIT C
TENANT IMPROVEMENTS
________________________________________________________________________________
This page has been intentionally left blank
January 5, 2000
▇▇. ▇▇▇▇ ▇▇▇▇▇▇
Pure Water Corporation
P.O. Box 80347
Seattle, Washington 98108-0347
RE: KENT EAST CORPORATE PARK
NOTICE OF LEASE COMMENCEMENT
Dear ▇▇▇▇:
The purpose of this letter is to serve as a written notification and
confirmation of certain provisions contained within your Lease. As of September
1, 1999, Pure Water Corporation took possession of the premises as described in
the Lease. The undersigned, on behalf of Tenant, acknowledges that Tenant is now
in possession of the premises and that the lease is in full force and effect.
▇▇▇▇▇▇ also acknowledges that a key to the premises has been received.
The lease commencement date is hereby deemed to be September 1, 1999. The
primary lease term as set for the in the Basic Lease Information shall be 88
months, the lease expiration date is December 31, 2006 and the initial base
rental payments shall be $28,857.00 per month.
The actual rentable area in the premises is hereby deemed to be 75,940 square
feet. The actual rentable area in the building is 75,940 square feet, and of the
Park as a whole is 807,096 square feet. Therefore, the Tenant's proportionate
share of the building and park area shall be 100% and 9.41% respectively.
Please indicate your agreement to and acceptance of the items outlined above by
signing the enclosed copy of this letter and returning one original copy to us.
Again, we welcome you to your new space within Kent East Corporate Park and look
forward to a long and mutually beneficial relationship.
Sincerely, APPROVED THIS 8TH DAY OF FEBRUARY, 2000
--- --------
▇▇▇▇▇▇▇▇ ▇▇▇▇ COMPANY PURE WATER CORPORATION
//s/▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇ BY: _______________________________________
Operations Manager
TITLE: President
_______________________________________
cc: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
AMENDMENT NO. 1
(DATED DECEMBER 23, 1996 FOR REFERENCE PURPOSES ONLY)
THIS AMENDMENT No. 1 to Lease is entered into by and between ARGONNE
COMMERCIAL CENTER, ("Landlord") and PURE WATER CORPORATION, a Washington
Corporation, ("Tenant").
RECITALS
WHEREAS, Landlord and ▇▇▇▇▇▇ entered into a Lease dated January 12,
1996 ("Lease") for the premises located at E. ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ #▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Premises"), and more particularly described in said
Lease; and,
WHEREAS, Landlord and Tenant now wish to further modify said ▇▇▇▇▇.
W I T N E S S E T H
NOW, THEREFORE, in consideration of mutual covenants herein below,
Landlord and ▇▇▇▇▇▇ agree as follows:
1. Paragraph #5 is amended to read as follows: "The term of this lease is
extended for a period of five (5) years commencing February 1, 1997 and
ending January 31, 2002."
2. Paragraph #8 is amended to read as follows: "▇▇▇▇▇▇ agrees to pay
Landlord as basic rent the amounts as follows:
COMMENCING ENDING BASIC MONTHLY RENTAL
---------- ------ --------------------
February 1, 1997 January 31, 1998 $1,041.00
February 1, 1998 January 31, 1999 $1,073.00
February 1, 1999 April 30, 1999 $1,105.00
May 1, 1999 January 31, 2000 $1,894.00
February 1, 2000 January 31, 2001 $1,950.00
February 1, 2001 January 31, 2002 $2,009.00
3. Beginning May 1, 1999, Paragraph #1 shall be amended to read as
follows: "PREMISES": Unit #14 containing approximately 5,605 square
feet of the building commonly know as ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, being a part
of the real property situated in the County of Spokane, State of
Washington, described as follows: The South 120 feet of the North 340
feet of the West 1/2 of Tract 363 of OPPORTUNITY PLAT TWO, as per Plats
thereof recorded in Volume "Q" of Plats, page 41, EXCEPT the west 5
feet thereof for Locust Road situate in the County of Spokane, State of
Washington."
4. Beginning May 1, 1999, ▇▇▇▇▇▇'s share of operation expenses as provided
in Paragraph 2 of Rider #1 to that certain Net Lease between Argonne
Commercial Center as Landlord and Pure Water Corporation, a Washington
Corporation as Tenant, dated January 12, 1996, shall be amended to
9.91%, increased from 5.96%. All other terms of said Paragraph 2,
Operation Expenses, shall remain the same.
5. Tenant herein acknowledges that ZDI Gaming's Lease expires April 30,
1999 as to Unit #15 and within a reasonable period of time after ZDI
Gaming vacates the premises, Landlord agrees to remove the office doors
from the existing office space to the warehouse area and to create a 8'
x 8' opening between Units #14 and #15 where opening had previously
existed. Further, ▇▇▇▇▇▇▇▇ agrees to remove the carpeting in the office
areas. THE STEPPED UP RENT WHICH INCLUDES UNIT #15 SHALL COMMENCE ON
MAY 1, 1999 OR ON THE DATE WHEN SAID SPACE IS READY FOR OCCUPANCY BY
PURE WATER CORPORATION.
6. This Amendment No. 1 modifies and supersedes the Lease as amended to
the extent stated herein only. In the event of any inconsistencies
between the Lease as amended and this Amendment No. 1, this Amendment
No. 1 shall control. All other provisions of the Lease as amended will
remain in full force and effect.
7. The Lease as amended and this Amendment No. 1 represents the entire
agreement of the parties and neither has made nor relied upon any
representations, warranties, promises, covenants or undertakings other
than those expressly set forth herein.
8. SEE ATTACHED EXHIBIT "A": FOR DESCRIPTION OF MODIFICATIONS PERTAINING
TO DRIVE-THROUGH OPENING BETWEEN UNITS 14 AND 15. ANY MODIFICATIONS TO
BE COMPLETED BY TENANT HEREIN SHALL BE COMPLETED IN A PROFESSIONAL
MANNER. AT LANDLORD'S OPTIONS TENANT AGREES TO REBUILD THE STEPS TO
MEZZANINE AND TO FINISH SOUTH MEZZANINE WALL WHICH MAY BE REMOVED BY
TENANT AS SHOWN ON EXHIBIT "A".
LANDLORD TENANT
ARGONNE COMMERCIAL CENTER PURE WATER CORPORATION ,
a Washington Corporation
________________________________ __________________________________
BY: ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇/ BY:_______________________________
▇▇▇▇▇ ▇. ▇▇▇▇▇ INC., FUND I Its: ____________________________
BY: ▇▇▇▇▇ ▇. ▇▇▇▇▇ INC., GENERAL Date: ________________________
PARTNER
Its: _____________________________
Date: ____________________________
A C K N O W L E D G E M E N T
STATE OF ____________________________ )
) ss.
County of ___________________________ )
I certify that I know or have satisfactory evidence that
______________________ ___________________________ is the person who appeared
before me, and said person acknowledged that he/she signed this instrument, on
oath stated that he/she was authorized to execute the instrument and
acknowledged it as the _______________________ of _____________________________
to be the free and voluntary act of such party for the uses and purposes
mentioned in the instrument.
DATED: ________________________ , 1996
_____________________________________________
NOTARY PUBLIC in and for said
County and State, residing at _______________
_____________________________________________
My appointment expires ______________________
A C K N O W L E D G E M E N T
STATE OF ____________________________ )
) ss.
County of ___________________________ )
I certify that I know or have satisfactory evidence that
______________________________________________ is the person who appeared before
me, and said person acknowledged that he/she signed this instrument, on oath
stated that he/she was authorized to execute the instrument and acknowledge it
as the ___________________ of __________________________________ to be the free
and voluntary act of such party for the uses and purposes mentioned in the
instrument.
DATED: ________________________ , 1996
_____________________________________________
NOTARY PUBLIC in and for said
County and State, residing at _______________
_____________________________________________
My appointment expires ______________________