APPLIED PROCESS ENGINEERING LABORATORY APEL - TENANT LEASE AGREEMENT
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Energy
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Revision
No: 11
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Effective
Date: May 1, 2007
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APPLIED
PROCESS ENGINEERING LABORATORY
▇▇▇▇
- TENANT LEASE AGREEMENT
| ISORAY MEDICAL, INC. |
N
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| (Tenant Name) |
(Tenant
Class)
(see
paragraph
5A)
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THIS
LEASE, made and entered into this 2nd
day of
May 2007, by and between the
Energy Northwest,
a
municipal corporation and joint operating agency of the State of Washington,
hereinafter called "Lessor" and IsoRay
Medical, Inc., hereinafter
called the "Lessee".
WITNESS:
WHEREAS,
the Lessor owns a multipurpose building in the City of Richland, ▇▇▇▇▇▇ County,
Washington, referred to hereinafter as the Applied Process Engineering
Laboratory ("▇▇▇▇") which is to provide high quality laboratory and validation
testing and development facilities and associated offices for research and
development, testing of new processes and products, including but not limited
to
environmental restoration, waste treatment and energy conservation;
and
WHEREAS,
the express purpose of ▇▇▇▇ is to ▇▇▇▇▇▇ the deployment of new technology based
businesses, product lines and jobs for the Tri-Cities, Washington area;
and
WHEREAS,
Lessee is desirous of renting space in ▇▇▇▇, and Lessee is willing to lease
such
space upon the terms and conditions and for the purposes hereinafter set forth;
and
WHEREAS,
Lessor finds that the Lessee’s intended activities within ▇▇▇▇ are consistent
with the ▇▇▇▇ charter and mission; and
WHEREAS,
Lessee has represented to Lessor an intent to form a business or venture in
the
local area should the research and/or development activities undertaken in
▇▇▇▇
prove successful;
NOW,
THEREFORE, it is agreed:
ARTICLE
1 - DESCRIPTION OF PREMISES
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Energy
Northwest Contract #X-40403
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Revision
No: 11
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Effective
Date: May 1, 2007
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The
Lessor, for and in consideration of the rental payments provided herein and
the
covenants and conditions herein contained, agrees to lease to the Lessee
nineteen thousand three hundred twenty eight (19,328) Rentable Square Feet
of
particular space located
in ▇▇▇▇ which includes the Annex, Breezeway, ▇▇▇▇ offices, labs, entrepreneur,
high bay, Exterior HVAC and Exterior Emergency Generator {hereinafter called
the
Premises},
and as further described in Exhibit A, “Description of Premises”, and by this
reference made a part hereof. All parking areas provided for Lessee's use are
included in and subject to the terms and conditions of this Lease.
ARTICLE
2 - TERM
A. The
term
of this Lease shall be for three (3) (Years) beginning on May
1,
2007 and
expiring on
April
30, 2010.
B. Occupancy
shall be contingent upon Lessee obtaining and providing all applicable
procedures, permits and licenses. The effective date, i.e. beneficial occupancy,
shall be the date construction commences. Lessee shall not be permitted to
perform any radiological production work until all applicable permits and
licenses are approved by the appropriate agencies and on file at ▇▇▇▇.
C. If
the
rental period from the beginning date of this Lease to the beginning of the
next
calendar month is less that a full calendar month, the rental payment shall
be
prorated to cover the fractional part of the month from the beginning date
through the last day of that calendar month.
D. The
term
of this lease shall be subject to the conditions established in the ▇▇▇▇
Graduation Policy 10.0, Exhibit D.
ARTICLE
3 - OPTION TO EXTEND LEASE
The
Lessee shall have the option to extend this Lease for two additional three
(3)
year terms, by giving the Lessor notice of its intention to do so at least
ninety (90) days prior to the expiration of the lease, provided, however, that
Lessee is not in default hereunder at the time of such notice or on the date
of
expiration of the lease by its terms. Such extended term shall be upon the
terms
and conditions as provided herein unless amended in a writing executed by the
authorized representatives of each Party. If the Parties cannot agree upon
the
terms of any extended period, then the Lease shall terminate, in accordance
with
article 28, entitled “Termination”.
ARTICLE
4 - RENT
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Revision
No: 11
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Effective
Date: May 1, 2007
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A. MONTHLY
RENT PAYMENTS - The Lessee covenants and agrees to pay Lessor as rental for
said
Premises a monthly Rent of twenty six thousand six hundred ninety two dollars
and eighty-five cents ($26,692.85) payable in advance on the first day of each
month during the term of this Lease, beginning on the Beneficial Occupancy
date.
The Rent for successive terms of this Lease shall be mutually agreed
upon by the Parties prior to the commencement of the new term. If the Parties
cannot agree upon such new Rent, then the Lease shall terminate, in accordance
with article 28, entitled “Termination”.
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Rented
Space Type
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Square
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Monthly
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Feet
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Rate
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Lab
& Entrepreneur Space
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3,564
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$
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4,836.34
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High
Bay, Annex, Breezeway & Exterior
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15,340
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$
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20,859.50
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Offices
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424
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$
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997.01
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Total
Rent
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19,328
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$
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26,692.85
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Total
Janitorial
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3,988
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$
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350.94
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Grand
Total Rent & Janitorial
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$
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27,043.79
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The
Rental Rates set forth above shall increase annually based on the Beneficial
Occupancy date to an amount equal to the prior year’s rate multiplied by the
escalation factor from The Consumers Price Index, West Urban Wage Earners and
Clerical Workers CPI-W, All Items
Interest
shall accrue on all unpaid Rent more than thirty (30) days past due at a rate
of
1 1/2 % per month until such Rent, including accrued interest, is paid in
full.
B. FIRST
AND
LAST MONTH’S RENT - Concurrently with the Lessee’s execution of this Lease, the
Lessee shall deliver to the Lessor the sum of fifty three thousand three hundred
eighty five dollars and seventy cents ($53,385.70) to be applied to the first
and last month’s Rent, and for performance
by Lessee of Lessee’s obligations hereunder, notwithstanding any other
obligations of the Lessee as defined in this Lease. This amount shall not bear
interest. Any balance shall be returned to Lessee at the expiration or sooner
termination of this Lease, after satisfaction of any and all of Lessee’s
obligations under this Lease.
ARTICLE
5 - USE OF PREMISES
| A. |
The
following definitions apply to the six classes of ▇▇▇▇ Lessees. The
classification of this Lease is designated on the cover page
hereto:
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Class
G
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Lessee’s
allowable use of Premises is limited to general research, development
and
testing not routinely involving the use of chemicals or the handling
or
generation of chemical or dangerous wastes or causing environmental
hazards. Certain materials that are incidental to Lessees activities
but
have specific handling and disposal requirements (such as lubricants,
hydraulic fluids and solvents) will be identified by the parties
and
subjected to applicable ▇▇▇▇ policies, protocols and
procedures.
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Energy
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Revision
No: 11
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Effective
Date: May 1, 2007
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Class
W
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Lessee’s
allowable use of Premises includes Class G activities, plus the routine
handling and disposal of limited volumes of chemicals and hazardous
materials in solid, liquid or gaseous forms. Unless otherwise noted
in
this contract, the volumes will be five (5) gallons or less per
container.
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Class
W1-
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Lessee’s
allowable use of Premises includes Class G activities, plus the routine
handling and disposal of moderate volumes of chemicals and hazardous
materials in solid, liquid, or gaseous forms in containers up to
55
gallons in volume.
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Class
W2-
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Lessee’s
allowable use of Premises includes Class W1 activities, plus the
handling
and disposal of chemicals or dangerous wastes in volumes greater
than 55
gallons, with approval of ▇▇▇▇
management.
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Class
N
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Lessee’s
allowable use of Premises includes Class W activities, plus the handling
and disposal of radionuclide materials which are low risk with respect
to
safety, the environment, contamination cleanup costs or potential
impact
to other
building occupant activities. Considerations for low risk include
very
short half life (less than 30 days), commercial sealed sources, small
radionuclide quantities, product dispersibility, and risks associated
with
related activities in the same or adjacent
spaces.
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Class
N1 -
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Lessee’s
allowable use of Premises includes all of the above classes and inclusive
of the Class W activities, the handling and disposal of radionuclide
materials which are of moderate risk with respect to safety, the
environment, contamination cleanup costs or potential impact to other
building occupant activities. Considerations for moderate risk include
moderate half life, potentially dispersible material forms, moderate
quantities, etc.
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B. Lessee
agrees that the Premises are to be used for approved purposes only, and for
no
other purpose without the prior written consent of the Lessor. Lessee shall
not
allow use of the Premises in a manner inconsistent with those approved purposes.
Lessee acknowledges that engaging in activities upon the Premises which are
in
any way inconsistent with approved purposes, or in any manner increase Lessor’s
insurance premiums, or which are determined to be illegal, shall constitute
breach of this Lease. Lessee further agrees to notify Lessor immediately upon
identification of any condition or event that is inconsistent with the following
approved purposes:
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Energy
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Revision
No: 11
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Effective
Date: May 1, 2007
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Approved
Purposes: Operate radioisotope production for the manufacture of brachytherapy
seeds for the treatment of cancer.
Lessee
shall comply with all local, state and federal laws, rules, orders, regulations
or requirements relating to Lessee’s use and occupancy of the Premises, or any
aspect of Lessee’s performance of its obligations under this Lease. Lessee shall
indemnify and hold the Lessor harmless from all liability resulting from any
violation thereof by the Lessee or any of its agents, officers, employees,
subcontractors or invitees.
C. Exhibit
B
sets forth by reference ▇▇▇▇ procedures and related documents for which Lessee
must be in compliance while conducting activities on the Premises. Lessee
acknowledges that all documents referenced in Exhibit B have been
provided, and the limitations and responsibilities of the Lessee with respect
to
those documents are understood. Lessee commits to Lessor that all activities
of
the Lessee,
its
agents, officers,
employees, subcontractors, licensees, and invitees
conducted on the Premises shall be in full compliance with the requirements
set
forth in this Lease, including those documents applicable to Lessee’s activities
as identified in Exhibit B, and to additions and updates to those documents
that
are provided in writing to the Lessee by the Lessor from time to time during
the
term of this Lease. Lessee further commits that all training and qualification
requirements identified by the ▇▇▇▇ Facility Director, as applicable, will
be in
place and maintained current during the conduct of approved activities per
the
terms of this Lease.
D. Lessee
agrees to comply with the Tenant Operating Agreement, Exhibit C, and to post
said agreement in a prominent place upon the Premises and ensure that all Lessee
employees, subcontractors and invitees are familiar with the terms of that
agreement.
E. Lessee
agrees to reasonably cooperate with other ▇▇▇▇ tenants and ▇▇▇▇ management
in coordinating test schedules, pooling inventories and sharing inventory
information in order to comply with permit related limits and in order to reduce
the amount of space required to be activated under the various
permits.
F. Lessee
shall be responsible to pay any fines or penalties levied by any entity with
jurisdictional authority over ▇▇▇▇ for which Lessee is determined to be
responsible. If the Parties are unable to agree on responsibility, the Parties
will proceed to resolve their disagreement per Article 26,
“Disputes”.
G. Lessee
shall ensure that the following prohibited articles are not brought onto the
▇▇▇▇ property and/or into the facility: firearms, non-prescriptive controlled
drugs, alcoholic beverages.
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Energy
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Revision
No: 11
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Effective
Date: May 1, 2007
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H. Lessee
shall provide copies of all IsoRay’s applicable production, radiological, safety
and emergency procedures, licenses and permits to the Applied Process
Engineering Laboratory. IsoRay shall provide access to all other procedures
as
requested.
I.
IsoRay
shall obtain its own Air Permit from the ▇▇▇▇▇▇ Clean Air Authority for the
7,900 sf. leased in the high bay and 6,000 sf. in the Annex and shall provide
a
copy of the permit.
J.
IsoRay
will obtain a Radioactive Materials License with the Department of Health and
provide a copy of the licenses to ▇▇▇▇.
▇. ▇▇▇▇▇▇
shall require Lessee at Lessee’s expense, to install at a minimum three (3) TLDs
attached to IsoRay’s perimeter walls in the high bay. Lessee shall report all
occurrences and events that are defined as reportable to the Department of
Health under IsoRay’s Radioactive Material License to the Lessor as they occur
and any other radiological occurrences that may impact building
activities.
L. The
Lessee shall not discharge any chemicals, dangerous or radiological waste or
production wastewater, in any concentration, to the sanitary sewer or process
wastewater system within ▇▇▇▇ or the Annex facilities.
Failure
to comply with the terms of this Article 5 shall be grounds for default as
set
forth in Article 27, “Default”. See
also
Article 23, “Inspection of Premises”, which defines Lessor’s right to inspect
the Premises for compliance with this Article 5.
ARTICLE
6 - COMMON AREAS
The
Lessee shall have nonexclusive use of all areas of ▇▇▇▇ designated by the Lessor
as common areas for the use generally of the tenants of ▇▇▇▇. The Lessor shall
maintain the common areas in good condition.
ARTICLE
7 - ALTERATIONS TO AND RESTORATION OF PREMISES
Prior
to
the commencement of the initial Lease term, the Lessor shall complete any
alterations to the Premises. Such premises are generally identified in Exhibit
A. Upon early termination or expiration of any Lease term, the Lessor, at its
option, may require that the Premises, including alterations by Lessor, be
restored, at the Lessee’s expense, to the condition of the Premises at the time
of commencement of the respective Lease term (including appropriate cleaning
and
disposal of any chemicals, wastes, radiological materials, residues and
equipment), absent normal wear and tear by the Lessee.
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Revision
No: 11
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Effective
Date: May 1, 2007
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Lessor
shall require the Lessee at the Lessee’s expense to decontaminate all lessee’s
leased premises. During the decontamination process Lessee shall be required
to
continue to pay rent for the contaminated space.
In
the
event the Lessee’s leased area or any portion thereof, or any adjacent area of
the ▇▇▇▇ facility cannot be decontaminated, the Lessee shall replace or pay
fair
market value for the leased premises based on a certified appraisal. Such costs
shall include all disposal costs incurred by the Lessor.
ARTICLE
8 - IMPROVEMENTS TO AND RESTORATION OF PREMISES BY LESSEE
A. After
the
commencement of any Lease term, and at Lessee's own expense, the Lessee may
make
additions or improvements to the Premises after having obtained Lessor's design
review. Lessor shall charge Lessee for Energy Northwest engineering
time
for
design review. The design and installation and operation of such improvements
shall be in compliance with all applicable codes and standards and ▇▇▇▇
environmental commitments. Upon early termination or expiration of the
respective Lease term, all such
improvements
and additions excluding supplies, equipment and personal property shall become
the property of Lessor; provided that upon termination or expiration of the
respective Lease term, the Lessor, at its option, may require, at Lessee's
expense, that all such additions and improvements be removed and the Premises
restored to its condition at the time of commencement of the respective Lease
term. Prior to the construction of any additions or improvements, Lessee shall,
at the reasonable request of the Lessor, obtain payment and performance bonds
as
required by law to assure payment to all contractors, subcontractors, laborers
and material suppliers.
B.
Lessee
may, during any Lease term, and subject to Lessor’s prior written approval, such
approval not to be unreasonably withheld, install in the Premises machinery,
equipment and fixtures as Lessee deems necessary for its use of the Premises,
provided machinery, equipment, or fixtures do not materially damage the
Premises, are not hazardous to other tenants or users of the property upon
which
the Premises are situated, are not in conflict with Lessor's permits or any
other applicable operating, code or regulatory requirements, and do not unduly
interfere with any other tenant's use and enjoyment of their premises. During
the respective Lease term, the machinery, equipment, and fixtures shall remain
the personal property of the Lessee. Upon early termination or expiration of
the
respective Lease term, if there is no default by the Lessee in the Lease, the
Lessee shall have the right to remove all machinery, equipment and fixtures
from
the Premises regardless of whether this personal property is attached to the
Premises by piping, wiring, bolts or otherwise. After the removal of the
machinery, equipment or fixtures from the leased Premises, the Lessee shall
restore, at its own expense, the Premises to its condition at the commencement
of the respective Lease term, absent normal wear and tear by the
Lessee.
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Energy
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Revision
No: 11
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Effective
Date: May 1, 2007
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Lessor
shall charge Lessee for all engineering reviews including, but not limited
to,
reviews related to project oversight, building impairments, outages and related
services, building codes, and updates to building “as-built” drawings, and a 15%
handling fee for project administrative costs.
ARTICLE
9 - ACCEPTANCE OF PREMISES
The
taking of possession of the Premises by the Lessee shall constitute an
acknowledgment by Lessee that the Premises are in good and habitable condition
and as represented by Lessor.
ARTICLE
10 - MAINTENANCE AND REPAIR
| A. |
All
matters regarding maintenance and repair of the Premises (and Common
areas
if applicable) shall be referred
to:
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| Name: | Construction & Maintenance Services | |
| Office Address: | P. O. ▇▇▇ ▇▇▇ | |
| ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | ||
| 24 Hour Number: | 377-6063 |
| B. |
The
Lessor shall provide and pay for maintenance, repair and replacement
of
the Premises,
including the building interior, exterior, grounds, and all equipment,
fixtures,
and appurtenances furnished by the Lessor under this Lease in order
to
keep
the same in good repair and habitable condition, except for damage
resulting from
willful abuse or negligence of the Lessee. The Lessor shall have
the right
to enter
upon the Premises at reasonable times in order to inspect the same
and to
perform
such maintenance and repair, as well as replacement, but this right
shall
be
exercised in a manner that does not unreasonably interfere with Lessee’s
use of
the Premises. Lessee shall provide written procedures for maintenance
Personnel entering and exiting radiological
areas.
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| C. |
Maintenance,
repair, and replacement services by the Lessor, in accordance with
Paragraph
B, include the following:
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Revision
No: 11
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Effective
Date: May 1, 2007
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1.
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Snow
removal and ice control in parking areas and
sidewalks;
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2.
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Painting
of interior and exterior of the building as required for good maintenance
practice;
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3.
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Scheduled
routine preventive maintenance of existing building mechanical, electrical
and heating, ventilation, and air conditioning (HVAC) systems to
minimize
breakdown;
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4.
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Repair
or replacement of existing building mechanical, electrical and HVAC
systems caused by wear and tear during ordinary use of these systems.
This
includes required relamping of interior and exterior light
fixtures;
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5.
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Grounds
maintenance including complete grass, tree, and shrub care and clean-up
plus maintenance and repair of automatic underground sprinkler
system;
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6.
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Pest
control on interior (sprays will not be used on interiors) and exterior
of
building to control ants, insects, rodents, or other common pests
to
maintain the Premises in habitable
condition;
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7.
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Replacement/repair
of exterior and interior worn or failed structural components of
the
building.
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| 8. |
Replacement
of carpet and drapes and/or blinds as needed. Replacements should
be color
coordinated with the existing draperies and/or blinds and floor
coverings.
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| 9. |
Perform
or have performed all necessary inspections, periodic testing, and
maintenance of elevators, fire extinguishers, fire alarm, and fire
preventive equipment and systems in accordance with applicable laws,
regulations and warranties.
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10.
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Planned
electrical outages, of any duration, affecting the Premises, will
not be
initiated by the Lessor without notification of the Lessee at least
48
hours in advance of such outage.
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11.
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In
the event a fire suppression or detection system is out of service,
the
Lessor shall notify the Lessee and provide a manned fire watch during
non-working hours. The fire watch shall be performed on a minimum
frequency of every two (2) hours.
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Energy
Northwest Contract #X-40403
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Revision
No: 11
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Tenant
Lease Agreement #014
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Effective
Date: May 1, 2007
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| D. |
In
the event of emergencies or unscheduled utility service outages,
the
Lessee may perform such maintenance and/or repairs as are necessary
to
ensure continuity
of critical operations or protection of equipment. Expenses incurred
by
the Lessee in such events shall be used as a basis for determining
the
amount the Lessor shall reimburse the Lessee for such expenses or
for
determining an equitable reduction in the
rent.
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ARTICLE
11 - JANITORIAL SERVICES
| A. |
The
Lessor shall provide and pay for all janitorial services for common
use
areas, and
shall keep those portions of the Premises in good and habitable condition.
Janitorial
services shall be performed during normal working
hours.
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| B. |
Janitorial
services shall not be performed for the high bay or Annex. Lessee
shall
Provide
their own janitorial services in their leased
areas.
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| During the conduct of janitorial duties, Lessor shall not disturb or attempt to clean bench tops, furniture, sinks, hoods, gas bottles or any laboratory fixtures or equipment located within laboratories. Lessor shall also report any suspected chemical spills to Lessee immediately upon identification and shall not attempt cleanup without prior approval and direction from Lessee. |
ARTICLE
12 - UTILITY CHARGES
The
Lessor may pay utility charges, including but not limited to electricity, sewer
and water, provided that each tenant has similar utility demands. Lessee shall
pay any utility charges that are reasonably demonstrated by Lessor to be in
excess of average tenant demands. Lessee shall provide, to the extent practical
and at its sole expense, for separate utility metering of loads that can be
reasonably expected to significantly exceed average
tenant demands, including, but not limited to, all associated operations of
the
Lessee’s hot cell located in the ▇▇▇▇ high bay. Lessor shall have the right to
charge Lessee for all or part of prorated utility costs for the rest of their
leased space. It is not expected that Lessor will do this unless utility rates
escalate substantially faster than the consumer price index used for rent
escalation. See Article 4.
The
Lessee shall pay for all utilities for the Annex.
ARTICLE
13 - TAXES AND ASSESSMENTS
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Energy
Northwest Contract #X-40403
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Revision
No: 11
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Tenant
Lease Agreement #014
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Effective
Date: May 1, 2007
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The
Lessee shall pay, and hold the Lessor harmless from, all state, federal and
local taxes and assessments levied against the Lessee's property, the
improvements thereon, the Lease interest, or any business activities performed
by Lessee in ▇▇▇▇ during the term of this Lease. Lessee may, in good faith,
contest the validity or the amount of any tax or assessment which it is required
to pay hereunder, and while such contest is continuing in good faith, the Lessee
may, to the extent permitted by law, refuse to pay such tax or assessment.
ARTICLE
14 - INDEMNIFICATION
| A. |
Without
limiting the other rights and remedies of Lessor, Lessee, to the
fullest
extent permitted by law, specifically
and expressly agrees to indemnify, defend, and hold harmless Lessor
and
its officers, directors, employees, and agents (hereinafter collectively
"Indemnitees"), against and from any and all claims, demands, suits,
losses, costs, and damages of every kind and description to persons
or
property, whether direct or indirect or consequential in tort or
contract
or otherwise, including
actual or potential environmental contamination, whether by radiological,
toxic or hazardous materials,
(including reasonable attorneys' fees and/or litigation expenses),
brought
or made against or incurred by any of the Indemnitees resulting from
or
arising out of Lessee’s breach of or default upon the terms of this lease,
any negligence or willful acts, or failure to act, of Lessee its
employees, agents, representatives, or subcontractors of any tier,
their
employees, agents, or representatives in the performance or nonperformance
of Lessee's obligations under this Lease or in any way related to
this
Lease.
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| ▇. |
▇▇▇▇▇▇
agrees to indemnify, defend and hold harmless Lessee from and against
any
claims,
demands, suits, losses, costs, and damages to persons or property
to the
extent caused by the gross negligence or willful misconduct of Lessor
or
it officers directors, employees and agents. The parties agree that
Lessor
shall not be liable to Lessee for any consequential, indirect or
special
damages whether in contract, tort or otherwise.
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ARTICLE
15 - LIENS
The
Lessee shall keep the Premises and the property in which the Premises are
situated, free from any liens or encumbrances arising out of any work performed,
materials furnished or obligations incurred by Lessee. If any such lien is
filed
against ▇▇▇▇, the Lessee's Lease interest, the Lessor or the Lessor’s property,
the Lessee shall cause the same to be discharged within twenty (20) days after
the date of filing the same.
ARTICLE
16 - LESSEE’S LIABILITY INSURANCE
A. The
Lessee shall, at Lessee's expense, maintain commercial general liability
insurance with an insurer acceptable to the Lessor, insuring against any and
all
claims for injury to or death of persons and loss of or damage to property
occurring upon, in or about
the
Premises arising from an act or omission of the Lessee or any of its agents,
contractors, representatives, licensees or invitees. Such insurance shall have
liability limits appropriate to Lessee’s Approved Purposes as set forth in
Article 5, “Use of Premises”, but not less than one million dollars
($1,000,000.00) [Class N
=
$1 million] combined
single limit for bodily injury and property damage per occurrence and in the
aggregate.
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B. The
Lessee shall, at Lessee’s expense, maintain environmental hazards insurance with
an insurer acceptable to the Lessor, insuring against any and all claims for
any
environmental impairment caused by Lessee’s actions within ▇▇▇▇, including third
party bodily injury, property damage and cleanup costs arising from a pollution
occurrence. Such insurance shall have liability limits appropriate to Lessee’s
Approved Purposes as set forth in Article 5, “Use of Premises”, but not less
than one million dollars ($1,000,000.00) [Class N, = $1 million] combined single
limit per occurrence and in the aggregate. If the policy is not a “claims made”
policy, a minimum of two years discovery and reporting of claims period is
required.
Lessee
or
Lessee’s insurer shall have the option to perform any required remediation, or
to pay for or reimburse the costs of any required remediation to the
satisfaction of the Lessor, Lessor’s insurer and the responsible regulatory
authorities.
C. All
insurance required per paragraph A and B above:
| 1. |
shall
be primary insurance as respects the Lessor for any and all covered
Lessee
liabilities arising from an act or omission of the Lessee or any
of its
agents, contractors, representatives, licensees or invitees. Any
such
insurance maintained by the Lessor shall be excess of Lessee’s insurance
and shall not contribute to it. The liability of Lessee and any of
its
insures shall
not be reduced, offset, or otherwise affected by the existence and/or
collectability
of any insurance maintained by Lessor;
and
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| 2. |
shall
contain a provision whereby the carrier agrees not to cancel or
significantly
modify the insurance without thirty (30) days prior written notice
to
the Lessor; and
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| 3. |
shall
name the Lessor as additional insured;
and
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| 4. |
shall
not contain a severability of interests
exclusion.
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The
Parties understand that they will be bound by the comparative fault laws of
the
State of Washington.
D. On
or
before taking possession of the Premises pursuant to this Lease, the Lessee
shall provide the Lessor with a copy of the insurance policies and certificates
evidencing
the aforesaid insurance coverage required per paragraphs A and B above, with
underwriters acceptable to the Lessor, such acceptance by Lessor not to be
unreasonably withheld. Renewal certificates and any changes in terms or
underwriter shall be furnished to the Lessor for approval at least thirty (30)
days prior to the expiration date of each policy for which a certificate was
theretofore furnished.
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ARTICLE
17 - LESSEE'S FIRE INSURANCE
The
Parties understand that Lessee assumes all responsibility for loss to its
personal property and Lease improvements and alterations on the Premises, and
Lessee’s loss of income due to fire on the Premises. Lessor is in no way
responsible for insuring,
replacing or repairing Lessee’s personal property, Lease improvements and
alterations, or loss of income, except for loss to Lessee’s personal property as
a direct result of Lessor’s negligent acts, errors or omissions.
ARTICLE
18 - LESSOR'S FIRE INSURANCE
The
Lessor shall, at Lessor's expense, maintain for ▇▇▇▇ a Commercial Property
Policy including a Causes of Loss - Special Form, in an amount of the
replacement value of the facility and permanently installed fixtures and
equipment. All proceeds of any such
insurance
shall be payable to Lessor and shall be applied to the restoration of the
Premises. Any proceeds of such insurance remaining after such restoration shall
belong to the Lessor.
ARTICLE
19 - CONDEMNATION
In
the
event that an authority superior to the Lessor, such as the State of Washington
or the United States of America should condemn the Premises of the ▇▇▇▇ facility
for public use, whether the right condemned shall consist of the fee simple
title or interest less than fee simple but of such nature as to render
operations by the Lessee impractical
or unfeasible, then this Lease Agreement shall forthwith terminate. Lessor
shall
not be obligated in any way to Lessee as a result of such condemnation, except
to pay to Lessee any sums actually paid to Lessor by the condemning authority
for rent paid by Lessee but not yet earned by Lessor, or for Lease improvements
owned by Lessee. Lessee shall be responsible for recovering any damages to
which
Lessee is legally entitled directly from the condemning authority.
ARTICLE
20 - DAMAGE OR DESTRUCTION
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A. If
the
Premises or the ▇▇▇▇ facility are damaged or destroyed by fire or any cause
other than an act or omission of Lessee, its employees, agents, invitees, or
licensees, the Lessor
shall restore the Premises and the ▇▇▇▇ facility, except for such fixtures,
improvements and alterations as are installed by Lessee, as nearly as
practicable to their condition
immediately prior to such damage or destruction. The Lessee, at the Lessee's
expense, shall so restore all such fixtures, improvements, and alterations
installed by the Lessee. The Lessor, at Lessee's expense, shall so restore
the
Premises and the ▇▇▇▇ facility with respect to all damage, including
contamination of the ▇▇▇▇ facility or the environment, caused by any act or
omission of Lessee, its employees, agents, invitees or licenses, and the Lessee
agrees to reimburse Lessor upon demand for all sums expended for such
restoration. The obligations to restore provided in this paragraph shall be
subject to Lessor's termination rights provided below. Any restoration shall
be
promptly commenced and diligently prosecuted. The Lessor shall not be liable
for
any special, consequential or punitive damages by reason of any such damage
or
destruction.
B. Notwithstanding
any of the foregoing provisions of this Article 20, in the event the Premises
or
the ▇▇▇▇ facility shall be destroyed or damaged to such an extent that the
Lessor deems that it is not economically feasible to restore the same, then
the
Lessor may terminate this Lease as of the date of the damage or destruction
by
giving the Lessee notice to that effect.
C. If
the
Lessor undertakes to restore the Premises or the ▇▇▇▇ facility as provided
within this Article 20, then commencing with the date of the damage or
destruction and continuing throughout the period of restoration, the rent for
the Premises shall be abated for such period in the same proportion as the
untenable portion of each type of space within the Premises as defined in
Article 4, Section A, “MONTHLY RENT PAYMENTS” bears to the whole thereof, except
that there shall be no abatement to the extent that any such damage or
destruction is caused by any act or omission of the Lessee, its employees,
agents, invitees or licensees.
ARTICLE
21 - ASSIGNMENT AND SUBLETTING
Neither
this Lease nor any right hereunder may be assigned, transferred, encumbered
or
sublet in whole or in part by the Lessee, by operation of law or otherwise,
without
the Lessor's prior written consent, such consent not to be unreasonably
withheld. The Lessor may assign its interest in this Lease.
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ARTICLE
22 - CLOSURE AND SURRENDER OF PREMISES
A. Subject
to the covenants and conditions set forth within this Lease, the Lessee, at
the
expiration or sooner termination of this Lease, shall quit and surrender the
Premises in good, neat, clean and sanitary condition, except for reasonable
wear
and tear, and damage not caused by acts or omissions by Lessee, its employees,
agents, invitees or licensees.
B. Lessee
shall provide a level of financial assurance acceptable to Lessor, demonstrating
Lessee’s ability to restore the Premises as required by Article 22, Section A
above. The amount of financial assurance shall be based on a closure plan with
a
corresponding cost estimate prepared by Lessee and accepted by Lessor. The
closure plan and financial assurance shall be provided in a form acceptable
to
Lessor prior to Beneficial Occupancy. Such financial assurance may take the
form
of:
1.
Insurance
2.
Financial Test (Self-Insurance)
3.
Corporate Guarantee
4.
Irrevocable Letter of Credit
5.
Trust
Fund
6.
Bond
7.
Combination of trust fund(s), bond(s), letter(s) of credit, and
insurance.
Unless
otherwise required in writing by Lessor, the requirement for a closure plan
and
proof of financial assurance are required only for Classes W, W1, W2, N and
N1
tenants.
ARTICLE
23 - INSPECTION OF PREMISES
Subject
to the Security provisions of Article 33, “Security”, the Lessee shall allow
Lessor escorted access at all reasonable times to said Premises for the purpose
of inspection and to fulfill any of Lesson’s obligations under this Lease.
Lessor shall have the right to inspect the Premises and review Lessee’s
activities to provide reasonable assurance to the Lessor and/or regulatory
authorities that such activities and condition of the Premises are in compliance
with applicable environmental regulations and permit conditions or commitments,
industrial safety, legal, policy, procedural and protocol requirements
established for ▇▇▇▇ and applicable to Lessee’s activities within ▇▇▇▇. Such
review shall in no way relieve Lessee of primary responsibility or liability
for
such compliance, nor the consequences of any failure of Lessee to
comply.
Lessee
shall provide written procedures for access to Radiological areas for
inspection.
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ARTICLE
24 - INSTALLATION OF SIGNS
The
Lessee will not cause or permit the display of any sign, notice or advertisement
in or about the Premises or the ▇▇▇▇ facility without Lessor's prior written
consent. Lessor shall have the right to place and maintain "For Rent" signs
in a
conspicuous place on said Premises for thirty (30) days prior to expiration
of
this Lease.
ARTICLE
25 - HOLDOVER
If
the
Lessee lawfully holds over after the expiration of the term of this Lease,
such
tenancy shall be a month to month tenancy. During such tenancy the Lessee agrees
to pay Lessor the same rate as provided herein, and to be bound by all the
applicable terms, covenants and conditions herein specified.
ARTICLE
26 - DISPUTES
Pending
resolution of a disputed matter, the Parties shall continue performance of
their
respective obligations pursuant to this Lease. Disputes regarding any factual
matter relating to this Lease shall be discussed by the Parties’ authorized
representatives who shall use their reasonable efforts to amicably and promptly
resolve the dispute. Should the authorized representatives be unable to resolve
any controversy or claim arising out of or relating to this Lease, or the breach
thereof, the Parties agree that the controversy or claim shall be settled by
binding arbitration in accordance with the Commercial Arbitration Rules of
the
American Arbitration Association, and judgment upon the award rendered by the
Arbitrator(s) shall be entered in any court having jurisdiction
thereof.
ARTICLE
27 - DEFAULT
A. If
any
rents reserved, or any part thereof, shall be and remain unpaid when the same
shall become due, or if Lessee shall violate or default in any of the covenants
and agreements herein contained and, after receiving written notice of such
violation or default, fail to remedy in 15 days, or immediately in the event
of
a fire, health or safety issue, then the Lessor may terminate this Lease upon
giving the notice required by law, and re-enter and take possession of said
Premises. If Lessee fails to remove its property from
the
premises in a timely manner, Lessor has the right to remove said property and
place it in safe storage. Lessee agrees to pay rent due for said storage.
Notwithstanding such re-entry by Lessor, the liability of Lessee for the rent,
Lease tax, and utilities provided herein, as well as the financial obligations
and guarantees set forth in Article 4, “Rent”, shall not be extinguished for the
balance of the term of the Lease. Lessee shall continue to pay the rent, Lease
tax, and utilities as they become due, and covenants and agrees to make good
to
the Lessor any deficiency arising after re-entry and re-letting of the Premises
at a lesser rental than herein agreed to. The Lessee shall pay such deficiency
each month as the amount thereof is ascertained by the Lessor.
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B. If
by
reason of any default on the part of the Lessee it becomes necessary for the
Lessor to employ an attorney or in case Lessor shall bring suit to recover
any
rent due hereunder, or for breach of any provision of this Lease or to recover
any rent due hereunder, or for breach of any provision of this Lease or to
recover possession of the leased premises, or if Lessee shall bring any action
for any relief against Lessor,
declaratory
or otherwise, arising out of this Lease, the prevailing party in such action
shall be awarded reasonable attorney's fees and all costs and expenses expended
or incurred in connection with such action.
C.
The
rights and remedies of the Lessor in this Article are in addition to any other
rights or remedies provided by law and under this Lease.
ARTICLE
28 - TERMINATION
In
addition to the provisions set forth in Article 27, “Default”, this Lease also
may be terminated by either party as provided in this article. A partial
termination of the Lease will be permitted if the Lessor requires the surrender
of a portion of the leased premises for any reason or agrees to accept Lessee’s
surrender of a portion of the leased premises. The party initiating termination
shall give the other party at least twelve months advanced written notice of its
intent to terminate. Rental payments after a partial termination shall be
reduced in proportion to the related reduction in occupancy of the Premises
and
upon Lessee’s satisfactory surrender of the premises. Rental payments due after
termination of the lease, whether the entire lease or of a portion, shall be
payable until Lessee surrenders the Premises in the condition required by the
terms of this Lease. The parties may agree upon a shorter notice period prior
to
termination so long as the terms of such agreement are in a writing executed
by
the authorized representatives of both parties.
ARTICLE
29 - NOTICES
A. All
notices, demands, and requests to be given by either party to the other shall
be
in writing and served either personally or sent by United States mail, postage
pre-paid, to the addresses below:
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| TO LESSOR at: |
Energy Northwest
Attention: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇
Mail Drop 1040
▇.▇. ▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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|
| TO LESSEE at: |
ATTN: Mr. ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇. ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇
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B.
NONDISCLOSURE
1. Lessee
agrees not to divulge to third parties, without the written consent of the
Contracting Officer, any information which relates to the technical or business
activities of Energy Northwest obtained from or through Energy Northwest in
connection with the performance of this contract unless:
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a.
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The
information was known to the Lessee prior to obtaining the same from
Energy Northwest;
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b.
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The
information is, at the time of disclosure by the Lessee, then in
the
public domain; or
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c.
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The
information is obtained by the Lessee from a third party who did
not
receive the same, directly or indirectly, from Energy Northwest and
who
has no obligation of nondisclosure with respect
thereto.
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Lessee
further agrees that he will not, without the prior written consent of the
Contracting Officer, disclose to any third party any information developed
or
obtained by the Contractor in the performance of this contract except to the
extent that such information falls within one of the categories described in
a.,
b., or c. above.
2.
If so
requested by the Contracting Officer, the Lessee further agrees to require
its
employees to execute a Nondisclosure Agreement prior to performing under this
Contract.
3.
Lessee
shall not release any information concerning the work under this Contract or
any
part thereof in the form of advertising or publication, including news releases
or professional articles, without the prior written approval of the Contracting
Officer.
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4. Lessor
shall maintain current nondisclosure agreements with Lessee for the duration
of
this lease. All employees, subcontractors, or other personnel entering the
Premises or having access to proprietary information must sign a nondisclosure
agreement provided by the Lessee.
ARTICLE
30 - WAIVER OF RIGHTS
The
failure of either party to insist upon strict performance of any of the
covenants and conditions of this Lease, or to exercise any option or right
herein conferred, shall not be construed to be a waiver or relinquishment of
any
such option or right, or any other covenants or agreements, but the same shall
be and remain in full force and effect.
ARTICLE
31 - TRANSFER OF OBLIGATION
The
covenants and conditions of this Lease shall be binding upon the heirs, legal
representatives, successors and agreed assigns of any or all the Parties
hereto.
ARTICLE
32 - GOVERNING LAW
This
Lease shall be governed by the laws of the State of Washington.
ARTICLE
33 - SECURITY
A. Both
Lessor and Lessee, and their respective, employees, agents, invitees and
licensees agree to comply with all security regulations and procedures
established by the Lessor for the ▇▇▇▇ facility. Lessor shall provide Lessee
employees, and such other individuals designated by Lessee, with electronic
security access and photo identification cards for access to the general ▇▇▇▇
facility, including common use areas. Lessee shall pay Lessor thirty dollars
($30) for each electronic access key card with picture or twenty five dollars
($25) for a keycard without a picture and ten dollars ($10) for a photo ID
card
only, or for replacements thereof due to damage or loss.
B.
Lessee
shall provide and maintain at its sole expense its own security provisions
specific to portions of the Lessee Premises for which Lessee security
requirements exceed those general ▇▇▇▇ facility security provisions provided
by
Lessor. Lessee shall provide Lessor reasonable access to such Lessee secured
areas in case of emergency, and to provide Lessor with reasonable assurance
that
Lessee remains in compliance with the terms and conditions of this Lease, and
to
conduct routine facility maintenance and inspections in accordance with the
terms and conditions of this Lease. Lessee shall provide to the Lessor a copy
of
Lessee’s security procedures.
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ARTICLE
34 - ENVIRONMENT, HEALTH AND SAFETY
The
Lessee shall be solely responsible for all Lessee activities conducted within
▇▇▇▇ to ensure that such activities are, on an on-going basis, in compliance
with the environmental/regulatory requirements of the Environmental Protection
Agency or the Washington State Department of Ecology, the health and safety
requirements of OSHA, WSHA, the City of Richland and ▇▇▇▇▇▇ County, and with
any
environmental or personnel health and safety requirements that may be
established by any regulatory agency and/ or ▇▇▇▇ management.
Lessee
agrees to collect and dispose of any and all hazardous waste generated by
lessee’s activities at ▇▇▇▇ in compliance with local, state, and federal laws
and regulations at its own expense. If Lessee's waste generation activity
qualifies for Small Quantity Generator (SQG) status as described in WAC
173-303-070(8), Lessee may, in accordance with ▇▇▇▇ Procedure 14.0, arrange
for
disposal through the ▇▇▇▇▇▇ County SQG Program (phone ▇▇▇-▇▇▇-▇▇▇▇) at the
Regional Moderate Risk Waste Facility located at the City of Richland Landfill.
If the Lessee intends to arrange disposal at another facility, the ▇▇▇▇ Director
shall be so informed at least 30 days in advance of disposal. The Lessee agrees
that all hazardous wastes will be accumulated in accordance with the satellite
accumulation requirements of WAC 173-303-200(2). If the Lessee's
hazardous waste
generation activity exceeds the small quantity generator criteria,
the Lessee's wastes shall be managed through the ▇▇▇▇ 90-Day accumulation
area in conformance with ▇▇▇▇ Procedure 9.0 and this contract. In the event,
Lessor occurs
additional costs as a result of waste generated by Lessee, Lessee agrees to
reimburse Lessor for costs incurred.
ARTICLE
35 - ORDER OF PRECEDENCE
The
Contract comprises the following documents in the order of precedence set forth
below:
1. Amendments
or Supplemental Agreements to ▇▇▇▇ Lease
2. ▇▇▇▇
Lease
3. Exhibit
A, Description of Premises
4.
Exhibit
B, Procedures and Other Documents
The
above
order of precedence controls in the event of any conflict, inconsistency or
ambiguity in the terms and conditions set forth within these
documents.
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ARTICLE
36 - ENTIRE AGREEMENT
This
document contains the entire and integrated agreement of the Parties and may
not
be modified or amended except in writing signed and acknowledged by both
Parties.
ARTICLE
37 - SIGNATURES
IN
WITNESS WHEREOF, the Parties hereto have signed this Lease on the date(s)
written below.
| /s/ ▇▇▇▇▇ ▇▇▇▇▇▇ | Principal Contracting Officer | 5/2/07 |
| LESSOR: |
Title
|
Date |
| /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇ | CFO | 5/2/07 |
| LESSEE: |
Title
|
Date |