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Exhibit 10.6
OFFICE LEASE
THIS LEASE, made and entered into in the City of Bellevue, State of Washington,
as of the 22nd day of March 1996, by and between THE TRUSTEES UNDER THE WILL AND
OF THE ESTATE OF ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, DECEASED acting in their fiduciary and not in
their individual capacities (hereinafter referred to as "LESSOR"), and BENEFITS
- PLUS ADMINISTRATORS, INC., a Washington corporation (hereinafter referred to
as "LESSEE"):
WITNESSETH:
In consideration of the mutual covenants herein contained, Lessor
hereby leases to Lessee and Lessee hereby leases from Lessor, for the term
hereinafter specified, the following described premises:
PREMISES
The certain space of approximately 6,587 square feet of net rentable
area, hereinafter referred to as the "DEMISED PREMISES" and as marked as Exhibit
"A" attached hereto, which Demised Premises are located on the fifth (5th) floor
of the building (the "BUILDING") commonly known as the "400 Building", located
at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇.▇., in Bellevue, King County, Washington, on the real
property described in the legal description attached hereto and marked Exhibit
"B".
TERM
1. The term of this Lease (the "LEASE TERM") shall be eighty-four (84)
calendar months commencing on the "Target Commencement Date" (defined below) or
such later date as the Demised Premises shall be tendered to Lessee as set forth
in Exhibit C attached (the "WORKLETTER"), or upon such earlier date as Lessee
takes possession and commences use of the Demised Premises for the permitted use
in Paragraph 4 below. Notwithstanding the preceding sentence, if the
Commencement Date is a day other than the first day of the calendar month, the
Lease Term shall not commence until the first day of the first calendar month
following the Commencement Date, however all of the other terms and conditions
of this Lease (including those regarding payment of rent) shall be applicable on
the Commencement Date. Lessor will confirm the Commencement Date (and the date
the term of this Lease will expire) in writing to Lessee promptly after the
commencement of the term of this Lease. The target commencement date is June 1,
1996 (the "TARGET COMMENCEMENT DATE").
PARTIAL CONSIDERATION
2. As partial consideration for the execution of this Lease, the Lessee
shall pay to Lessor, the sum of Seven Thousand Two Hundred Seventy Three and
15/100 Dollars ($7,273.15). Such sum shall be applied to the rent due for the
first month of the Lease term. In no event shall Lessor be required to keep
these sums separate from its general accounts, nor shall Lessor be required to
pay or accrue interest for use of the partial consideration.
RENT
3. Lessee covenants and agrees to pay to Lessor, or its contract
manager, THE SENECA REAL ESTATE GROUP, INC., at its office, or such other place
or party as may be designated in writing by Lessor, as rent for the Demised
Premises, the following sums:
(A) Base Rent: During the first forty-eight (48) full calendar months during the
Lease Term (and any partial months at the commencement of the Lease Term),
Eighty Seven Thousand Two Hundred Seventy Seven and 80/100 Dollars ($87,277.80)
per annum, payable in equal monthly installments in the amount of Seven Thousand
Two Hundred Seventy Three and 15/100 Dollars ($7,273.15), and thereafter One
Hundred Thousand Four Hundred Fifty One and 76/100 Dollars ($100,451.76) per
annum, payable in equal monthly installments in the amount of Eight Thousand
Three Hundred Seventy and 98/100 Dollars ($8,370.98). Base Rent shall be due and
payable in advance on the first day of each calendar month during the term
hereof. Rent for partial months shall be prorated in proportion to the number of
days of the month included in the Lease Term.
(B) Additional Rent:
(1) During each calendar year after calendar year 1996 (the "BASE
YEAR"), Lessee agrees to pay as "Additional Rent" for the Demised Premises,
"Lessee's Share" (defined below) of all increases in Property Taxes and
Operating Expenses incurred by Lessor in the operation of the Building, over the
amount of the Property Taxes and Operating Expenses incurred by Lessor in the
operation of the Building during the Base Year. For purposes of this Lease,
"LESSEE'S SHARE" shall mean the ratio between the rentable area of the Demised
Premises and the rentable area of the Building. Lessee's Share, calculated based
on the initial square foot area of the Demised Premises, is nine and 92/100
percent (9.92%). The estimated amount of the Property Taxes and Operating
Expenses for the Base Year is $7.65 per rentable square foot of the Building.
(2) Prior to or promptly after the commencement of each calendar year
following the Base Year, Lessor shall give Lessee a written estimate of the
anticipated increases in Property Taxes and Operating Expenses over the Base
Year and Lessee's Share of such increases. Lessee shall pay such estimated
amount to Lessor in equal monthly installments, in advance, without deduction or
offset, on or before the first day of each calendar month, with the monthly
installment of Base Rent payable under Paragraph 3(A) above. After the end of
each calendar year, Lessor shall furnish to
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ORIGINAL
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Lessee a statement showing in reasonable detail the actual increases over the
Base Year in the Property Taxes and Operating Expenses incurred by Lessor during
the applicable calendar year and Lessee's Share thereof. If the statement shows
Lessee's Share of the actual increases exceeds the amount of Lessee's estimated
payments, within thirty (30) days after receiving the statement, Lessee shall
pay the amount of the deficiency to Lessor. If the statement shows Lessee has
overpaid, the amount of the excess shall be credited against installments of
Base Rent and Additional Rent next coming due under this Lease; provided,
however upon the expiration or earlier termination of the Lease Term, if Lessee
is not then in default under this Lease, Lessor shall refund the excess to
Lessee.
(3) If at any time during any calendar year of the Lease Term (other
than the Base Year) the Property Taxes applicable to the Building change and/or
any information used by Lessor to calculate the estimated Operating Expenses
changes, Lessee's estimated share of such Property Taxes and/or Operating
Expenses, as applicable, may be adjusted accordingly effective as of the month
in which such changes become effective, by written notice from Lessor to Lessee
of the amount or estimated amount of the change, the month in which effective,
and Lessee's Share thereof. Lessee shall pay such increase to Lessor as a part
of Lessee's monthly payments of estimated Property Taxes or Operating Expenses
as provided in subparagraph (2) above, commencing with the month following the
month in which Lessee is notified of the adjustment.
(4) For purposes of this Lease, the term "Operating Expenses" means all
costs of and expenses paid or incurred by Lessor for maintaining, operating,
repairing, replacing and administering the Building, including all common areas
and facilities, and shall include the following costs by way of illustration but
not limitation: water and sewer charges; insurance premiums; license, permit,
and inspection fees; heat; light; power; steam; janitorial and security
services; labor; salaries; air conditioning; landscaping; maintenance and repair
of driveways and surface areas; supplies; materials; equipment; tools; the cost
of any capital improvements or modifications made to the Building by Lessor that
are intended to reduce Operating Expenses, are required under any governmental
law or regulation not applicable to the Building or not in effect at the time
the Building was constructed, or are made for the general benefit and
convenience of all tenants of the Building, which costs shall be amortized over
such reasonable period as Lessor shall determine with a return on capital at the
current market rate per annum on the unamortized balance or at such higher rate
as may have been paid by Lessor on funds borrowed for the purpose of
constructing such capital improvements; all property management costs, including
office rent for any property management office and professional property
management fees; legal and accounting expenses; and all other expenses or
charges which, in accordance with generally accepted management practices would
be considered an expense of maintaining, operating, repairing, replacing or
administering the Building. Notwithstanding the foregoing, Operating Expenses
shall not include ground lease rental payments or debt service on mortgages or
deeds of trust encumbering the Building; leasing commissions and attorneys' and
other fees and costs incurred in leasing space in the Building or in connection
with disputes with tenants of the Building; depreciation; the cost of tenant
improvements; or the cost of any special services rendered to individual tenants
of the Building (including Lessee) for which a special charge is made or which
are not generally made available to all tenants of the Building.
(5) For purposes of this Lease, the term "Property Taxes" means all
real estate taxes or personal property taxes and other taxes, surcharges and
assessments, unforeseen as well as foreseen, which are levied with respect to
the Building and any improvements, fixtures and equipment and other property of
Lessor, real or personal, located in the Building and used in connection with
the operation of the Building, and the land upon which it is situated, and any
tax, surcharge or assessment which shall be levied in addition to or in lieu of
real estate or personal property taxes, other than taxes covered in Paragraph 4.
The term "Property taxes" shall also include any rental, excise, sales,
transaction, privilege, or other tax or levy, however denominated, imposed upon
or measured by the rental reserved hereunder or on Lessor's business of leasing
the Demised Premises, excepting only net income, inheritance, gift and franchise
taxes.
(C) Late Charges: Rental shall be paid without deduction or offset. In the event
Lessee should fail to pay any installment of rent or any other sum due Lessor
hereunder within ten (10) days after such amount is due, Lessee agrees to pay to
Lessor as Additional Rent a late charge equal to five percent (5%) of each such
installment.
4. Lessee will use and occupy the Demised Premises for office use and
for no other purpose. Lessee will not use or permit in the Demised Premises
anything that will increase the rate of fire insurance therein or prevent
Lessor's taking advantage of any ruling of the Washington Insurance Examining
Bureau or its successors which would allow Lessor to obtain reduced rates for
long-term insurance policies, or maintain anything that may be dangerous to life
or limb, or in any manner deface, injure or commit waste in, on or about said
building or any portion thereof, or overload the floors, or permit any
objectionable noise or odor to escape or to be emitted from the Demised
Premises, or permit anything to be done upon the Demised Premises in any way
tending to create a nuisance or to disturb any other tenants of the building, or
to injure the reputation of the building or to use or permit the use of Demised
Premises for lodging or sleeping purposes, or for any immoral
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or illegal purposes. Lessee will comply, at Lessee's own cost and expense, with
all orders, notices, regulations or requirements of any municipality, state or
other governmental authority respecting the use of the Demised Premises. Lessee
shall be liable for and shall pay prior to delinquency, all taxes, levies and
assessments against any personal property or trade fixtures placed by Lessee in
or about the Demised Premises.
ASSIGNMENT & SUBLETTING
5. (A) Lessee shall not voluntarily or involuntarily assign, sublet,
mortgage or otherwise encumber or convey all or any portion of its interest in
this Lease or in the Demised Premises without obtaining the prior written
consent of Lessor, and any such attempted assignment, subletting, mortgage or
other encumbrance or conveyance without such consent shall be null and void and
of no effect. Lessor will not unreasonably withhold its consent to any proposed
assignment or subletting by Lessee, and in determining whether to consent to a
proposed assignment or subletting, Lessor may consider any commercially
reasonable basis for approving or disapproving the proposed subletting or
assignment, including without limitation any of the following: (i) the
experience or business reputation of the proposed assignee or sublessee, (ii)
whether the clientele, personnel or foot traffic which will be generated by
the business of the proposed assignee or sublessee is consistent in Lessor's
opinion with the businesses of other tenants of the Building, (iii)
notwithstanding that Lessee or others may remain liable under this Lease,
whether the proposed assignee or sublessee has a net worth and financial
strength and credit record satisfactory to Lessor, and (iv) whether the use of
the Demised Premises by the proposed assignee or sublessee will violate or
create any potential violation of any laws or a breach or violation of any
other lease or agreement by which Lessor is bound.
(B) No permitted assignment, subletting, mortgage or other encumbrance
of Lessee's interest in this Lease shall relieve Lessee of its obligations to
pay the rent and to perform all of the other obligations to be performed by
Lessee hereunder. The acceptance of rent by Lessor from any other person shall
not be deemed to be a waiver by Lessor of any provision of this Lease or be a
consent to any subletting, assignment, mortgage or other encumbrance or
conveyance. Consent to one sublease, assignment, mortgage or other encumbrance
or conveyance shall not be deemed to constitute consent to any subsequent
attempted subletting, assignment, mortgage or other encumbrance or conveyance.
(C) If Lessee desires at any time to assign this Lease or to sublet the
Demised Premises or any portion thereof, it shall first notify Lessor of its
desire to do so and shall submit in writing to Lessor no less than thirty (30)
days prior to the date such assignment or subletting is to be effective (i) the
name of the proposed subtenant or assignee; (ii) the nature of the proposed
subtenant's or assignee's business to be carried on in the Demised Premises;
(iii) the terms and provisions of the proposed sublease or assignment and a copy
of the proposed sublease or assignment form; and (iv) such financial and other
information as Lessor may request concerning the proposed subtenant or assignee.
(D) Upon receipt of the notice required in Paragraph 5(C) above,
Lessor, at its option, shall have the right to terminate this Lease as to the
portion of the Demised Premises which Lessee proposes to sublease or assign,
unless Lessee withdraws its request for the proposed assignment or subletting
within ten (10) days after receiving written notice of Lessor's election to
terminate this Lease. Lessor shall have twenty (20) days from the date it
receives Lessee's notice under Paragraph 5(C) to exercise such option. If Lessor
exercises its option to terminate this Lease as to the portion of the Demised
Premises to be sublet or assigned, Lessor shall be free to lease such portion of
the Demised Premises to any person or entity (including the sublessee or
assignee proposed by Lessee) on such terms and conditions as Lessor deems
acceptable. If Lessor does not exercise such option within such time, Lessee may
thereafter assign this Lease or sublet the portion of the Demised Premises
subject thereof, provided Lessor pursuant to Paragraph 5(A) above consents
thereto, but at the rental rate and other terms and conditions set forth in
Lessee's notice to Lessor and not later than ninety (90) days after delivery of
the aforesaid Lessee's notice to Lessor unless a further notice is given. No
action or inaction by Lessor in connection with its right under this Paragraph
5(D) shall constitute or be deemed to constitute an approval of a proposed
assignment or sublease for purposes of Paragraph 5(A). If Lessor elects not to
recapture the portion of the Demised Premises to be sublet or assigned pursuant
to this Paragraph 5(D) and Lessor consents to the subletting or assignment,
Lessee shall pay to Lessor one-half (1/2) of any and all consideration received
by Lessee for the sublease or assignment, including without limitation any rent
payments to Lessee in excess of the monthly minimum rent payable by Lessee
pursuant to this Lease; however, such additional consideration shall be reduced
by any reasonable costs and expenses (including brokerage fees and tenant
improvement costs) incurred by Lessee in connection with the subject sublease or
assignment.
(E) The voluntary or other surrender of this Lease by Lessee or a
mutual cancellation hereof shall not work a merger, and shall at the option of
Lessor, terminate all or any existing subleases or subtenancies or shall operate
as an assignment to Lessor of such subleases or subtenancies. The transfer,
assignment or hypothecation of any stock or other ownership interest in Lessee,
in the aggregate in excess of twenty-five percent (25%), shall be deemed an
assignment within the meaning and provisions of this Paragraph 5; provided,
transfers of stock or other ownership
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interests in Lessee in excess of twenty-five percent (25%), shall not be deemed
an assignment within the meaning and provisions of this Paragraph 5 so long as
▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ collectively own at least
fifty percent (50%) of the beneficial ownership interests in Lessee. Lessee
agrees to reimburse Lessor for Lessor's reasonable costs and attorney's fees
incurred in conjunction with the processing and documentation of any such
requested assignment, subletting, transfer, change of ownership or hypothecation
of this Lease or Lessee's interest in and to the Demised Premises.
ALTERATION
6. Lessee will make no alterations in, or additions to, the Demised
Premises without obtaining the prior written consent of Lessor. Lessor may
impose such conditions on its consent as Lessor deems appropriate. All
additions, improvements and fixtures (except the movable furniture and trade
fixtures of Lessee) made or added either by Lessee or Lessor shall be and remain
the property of Lessor; provided however, that Lessor may require, at Lessee's
expense, that Lessee remove, upon termination of this Lease, any additions made
or fixtures added by Lessee.
REPAIRS, SURRENDER OF PREMISES
7. Lessee shall at all times take good care of the Demised Premises.
Lessee agrees to promptly repair at Lessee's expense:
(A) all injury to the Demised Premises, or to the Building of which they
are a part, caused by moving the property of Lessee in or out of the
Building or the Demised Premises;
(B) all breakage or damage to the Demised Premises or the building caused
by Lessee or the agents, servants or employees of Lessee;
(C) all injury or damage to the Demised Premises from fire or other
casualty caused by negligence of Lessee, his agents, servants or
employees except as provided in paragraph 10.
Lessee shall return the Demised Premises to Lessor at the expiration or
earlier termination of this Lease in good condition, subject to
ordinary wear and tear.
INDEMNIFICATION
8. (A) Lessor shall indemnify, hold Lessee harmless from and defend
Lessee against any and all claims, losses, costs, damages, expenses and
liabilities, including without limitation reasonable attorneys' fees, for any
injury or damages to any person or property whatsoever, when such injury or
damage has been caused in whole or in part by any negligent or willful act or
omission of Lessor, or any officer, agent or employee of Lessor, or resulting
from Lessor's failure to comply with any terms or conditions of this Lease. This
indemnity shall not require payment as a condition precedent to recovery. This
indemnity with respect to acts or omissions during the term of this Lease shall
survive termination or expiration of this Lease. As between Lessor and Lessee,
the foregoing indemnity is specifically and expressly intended to constitute a
waiver of Lessor's immunity under Washington's Industrial Insurance Act, RCW
Title 51, to the extent necessary to provide Lessee with a full and complete
indemnity from claims made by Lessor, and its employees, to the extent of their
negligence.
(B) Lessee shall indemnify, hold Lessor harmless from and defend Lessor
against any and all claims, losses, costs, damages, expenses and liabilities,
including without limitation reasonable attorneys' fees, for any injury or
damages to any person or property whatsoever, when such injury or damage has
been caused in whole or in part by any negligent or willful act or omission of
Lessee, or any officer, agent or employee of Lessee, or resulting from Lessee's
failure to comply with any of the terms or conditions of this Lease. This
indemnity shall not require payment as a condition precedent to recovery. This
indemnity with respect to acts or omissions during the term of this Lease shall
survive termination or expiration of this Lease. As between Lessor and Lessee,
the foregoing indemnity is specifically and expressly intended to constitute a
waiver of Lessee's immunity under Washington's Industrial Insurance Act, RCW
Title 51, to the extent necessary to provide Lessor with a full and complete
indemnity from claims made by Lessee and its employees, to the extent of their
negligence.
(C) Lessee shall and does hereby assume all risk of loss or damage to
furnishings, furniture, fixtures, supplies, merchandise and other property,
stored, placed or affixed in the Demised Premises and does hereby agree, except
to the extent of the negligence or willful misconduct of Lessor or its
employees, agents or contractors, Lessor shall not be responsible for loss or
damage to any such property.
INSURANCE
9. Lessee hereby agrees to maintain in full force and effect at all
times during the term of this Lease, at its own expense, for the protection of
Lessee and Lessor, as their interests may appear, policies of insurance issued
by a responsible carrier or carriers acceptable to Lessor which afford the
following coverages:
(A) Comprehensive General Liability Insurance including Blanket Contractual
Liability Broad Form Property Damage, Personal Injury, Completed
Operations, Products Liability and Fire
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Damage, such insurance to afford protection in the minimum combined
limit of not less that $1,000,000.00.
(B) Fire insurance with extended coverage endorsement upon Lessee's
equipment, furniture, fixtures, merchandise and any other personal
property located in the Demised Premises in the amount of the full
insurable value thereof.
(C) Workers' Compensation as required by statute and Employee's liability
of not less than $1,000,000.00.
The Lessee shall deliver to Lessor prior to occupancy and thereafter at least
thirty (30) days prior to expiration of such policy, Certificates of Insurance
evidencing the above coverage which shall expressly provide that at least thirty
(30) days prior written notice shall be given Lessor in the event of material
alteration or cancellation of the coverage. Lessor makes no representation that
the limits of liability specified to be carried by Lessee under the terms hereof
are adequate to protect Lessee; if Lessee deems this insurance to be inadequate,
Lessee shall, at its own expense, provide such additional insurance as
necessary.
WAIVER OF SUBROGATION
10. The parties shall obtain from their respective insurance carriers
waivers of subrogation against the other party, agents, employees and as to
Lessee, invitees. Neither party shall be liable to the other for any loss or
damage caused by fire or any of the risks enumerated in a standard fire
insurance policy with an extended coverage endorsement if such insurance was
obtainable at the time of such loss or damage.
LIABILITY FOR INJURY OR DAMAGE
11. Lessor shall not be liable to Lessee for any damage to personal
property resulting from the carelessness, negligence or improper conduct on the
part of a co-tenant or anyone other than Lessor, or for any damage to person or
property resulting from any condition of the Demised Premises or other cause,
including, but not limited to, damage by water, not resulting from the
negligence of Lessor. Lessee shall give Lessor prompt notice of any defects in
the Demised Premises to be remedied by Lessor.
DAMAGE TO PREMISES
12. In the event the Demised Premises shall be wholly destroyed, this
Lease may be terminated by either party as of the date of destruction. If the
Demised Premises are partially damaged then Lessor may, at Lessor's option,
exercised in writing within sixty (60) days of written notice of damage from
Lessee, elect to terminate this Lease or to repair the damages. If Lessor elects
to repair the damages, Lessor shall at its own expense, without unnecessary
delay, repair the damages. If Lessor elects to repair, Lessee shall pay the cost
of repairing any tenant improvements in the Demised Premises other than the
Building itself and Building standard improvements. Lessee shall be entitled to
an abatement of rent in fair proportion to the amount and nature of the damage
sustained, until the Demised Premises are made fit for occupancy and use.
Provided however, that Lessee shall not be entitled to an abatement of rent if
such damage was caused by the negligence or willful misconduct of Lessee or
Lessee's employees or invitees.
EMINENT DOMAIN
13. If all or any part of the Demised Premises shall be taken as a
result of the exercise of the power of eminent domain, this Lease shall
terminate as to the part so taken as of the date of taking. In the event of a
partial taking, either Lessor or Lessee shall have the right to terminate this
Lease as to the balance of the Demised Premises by written notice to the other
within thirty (30) days after such date, provided however, that a condition to
the exercise by Lessee of such right to terminate shall be that the portion of
the Demised Premises taken shall be of such extent and nature as substantially
to handicap, impede or impair Lessee's use of the balance of the Demised
Premises. In the event of a total taking or a partial taking resulting in
termination of this Lease, Lessor shall be entitled to any and all compensation,
damages or awards which may be paid in connection therewith. Lessee shall be
entitled to any damages attributable to moving expenses or damages to Lessee's
non-removable fixtures, provided that such award does not diminish the award to
Lessor and further provided that no portion of the award is for any excess value
or leasehold value of this Lease. In the event of a partial taking of the
Demised Premises which does not result in termination of this Lease, the monthly
rental thereafter shall be equitably reduced.
ADMITTANCE BY PASS-KEY
14. Lessor shall not be liable for the consequences of admitting by
pass-key or refusing to admit to the Demised Premises Lessee or any of Lessee's
agents, employees or other persons claiming the right of admittance.
EXHIBITION AND INSPECTION OF PREMISES
15. Lessor and Lessor's agents shall have the right at reasonable hours
to (a) exhibit the Demised Premises to prospective purchasers and during the
final six months of the term hereof to prospective lessees; (b) to examine the
Demised Premises to determine whether Lessee complying with its obligations
hereunder and in reference to any emergency or general maintenance; (c) supply
janitorial service and any other service supplied by Lessor to Lessee hereunder;
and (d) to make repairs or alterations to any portion of the Building. Lessee
hereby waives any claim for damages or any injury or inconvenience to or
interference with Lessee's business, occupancy or quiet enjoyment
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of the Demised Premises. Lessor agrees Lessee may install an internal security
system and locks on offices or other areas located in the Demised Premises so
long as Lessor is provided with such pass-keys or codes as may be necessary for
Lessor to have full access to the Demised Premises. Lessee at its option, may
designate certain portions of the Demised Premises from time to time as being
"off limits" and may secure such portions of the Demised Premises, and neither
Lessor nor its employees, agents or contractors shall have any access to such
areas of the Premises except in an emergency. If Lessee elects to designate
areas of the Demised Premises as off limits, Lessor shall have no obligation to
provide janitorial services to such areas.
VACATION OR ABANDONMENT
16. Upon vacation or abandonment of the Demised Premises by the Lessee
without the prior written consent of Lessor, Lessor may forthwith enter upon the
Demised Premises or any portion thereof and relet and otherwise exercise control
over the Demised Premises and Lessee's fixtures and equipment situated therein.
For the purpose of such reletting, Lessor is authorized at the cost of Lessee to
make any repairs, changes, alterations or additions in or to said Demised
Premises which may be necessary in the opinion of Lessor for the purpose of such
reletting. Such entry and control shall not release Lessee from the obligations
herein and Lessee shall remain liable and continue to be bound and shall
continue to pay rent, unless Lessor, at Lessor's election, shall terminate this
Lease, and in that event Lessor shall be entitled to damages as provided in
paragraph 24. Any personal property left on the Demised Premises shall be
deemed to be abandoned at the option of Lessor and Lessee waives any claims to
or arising from said property.
SIGNS
17. No sign, picture, advertisement or notice shall be displayed,
inscribed, painted or affixed to any of the glass or woodwork of the Demised
Premises, or on the exterior walls of the Building, except such as shall be
approved in writing by Lessor.
ELECTRICAL AND MECHANICAL DEVICES AND INSTALLATIONS
18. Lessee shall not without Lessor's prior written consent, operate or
install any electrical equipment or operate or install any machinery or
mechanical device said Demised Premises other than that normal to office use. No
electric wiring or other electrical apparatus shall be installed, maintained or
operated on the Demised Premises, except with the prior written approval of and
in a matter satisfactory to Lessor, and in no event shall Lessee overload the
electrical circuits from which Lessee obtains current.
WINDOWS
19. Lessee shall not allow anything to be placed on the outside window
ledges of the Demised Premises. No awnings shall be attached to the outside of
any windows of the Demised Premises. Only such window draperies furnished by
Lessor, which shall be uniform to Building standards, shall be exposed to
exterior views.
FLOOR COVERINGS
20. Lessee, or any other person, shall not lay linoleum or any other
similar floor covering or attach or affix any covering to the walls or ceiling
of the Demised Premises or any part thereof without the prior consent of Lessor.
Any such addition shall be deemed an alteration within the meaning of paragraph
6, and shall be subject to the conditions set forth therein.
SERVICES
21. (A) Lessor agrees to furnish or cause to be furnished to the
Demised Premises, the utilities and services described below, subject to the
conditions and in accordance with the standards set forth below:
(1) Lessor shall provide automatic elevator facilities from 7
a.m. to 6 p.m., Monday through Friday, except for holidays observed by Building
management ("NORMAL BUILDING HOURS"). At least one elevator will be available
for use at all times other than Normal Building Hours (so Lessee shall have
access to the Demised Premises seven (7) days per week, twenty-four (24) hours
per day, including holidays), subject to such Building security systems and
procedures as may be in effect from time to time. Passes permitting access to
the Building at hours other than Normal Business Hours will be made available to
Lessee for all existing and new employees of Lessee at no additional charge;
provided, Lessor may impose a reasonable charge (currently $10.00) to replace
lost, stolen or damaged passes.
(2) During Normal Building Hours, and on Saturdays (other than
holiday weekends) from 8:00 a.m. to 1:00 p.m., Lessor shall ventilate the
Demised Premises and furnish heat and air conditioning when in the judgment of
the Lessor it is required for the comfortable occupancy of the Demised Premises,
subject to any governmental requirements or standards relating to, among other
things, energy conservation. Upon request, Lessor shall make available at
Lessee's expense after hours heat or air conditioning. The minimum use of after
hours heat or air conditioning and the cost thereof shall be determined by
Lessor and confirmed in writing to Lessee the same may change from time to time.
In addition to any and all other rights and remedies which Lessor may have for a
violation or breach of this Lease, Lessor may discontinue said after hours
heating and air conditioning service without any abatement of rent to Lessee
whatsoever.
(3) Lessor shall furnish to the Demised Premises at all times,
subject to interruptions beyond Lessor's control, electric current as required
by the building standard office
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light and receptacles. At all times Lessee's use of electric current shall never
exceed the capacity of the feeders to the Building or the risers or wiring
installations, or be in violation of any governmental energy use ordinance.
(4) Lessor shall furnish water for drinking, cleaning and
lavatory purposes only.
(5) Lessor shall provide janitorial services to the Demised
Premises, comparable to that provided in other comparable office buildings in
the immediate vicinity of the Building, provided the same are used exclusively
as offices, and are kept reasonably in order by Lessee. If the Demised Premises
are not used exclusively as offices, and Lessor directs, they shall be kept
clean and in order by Lessee, at Lessee's expense and to the satisfaction of
Lessor, and by persons approved by Lessor and no one other than persons approved
by Lessor shall be permitted to enter the Demised Premises for such purposes.
Lessee shall pay to Lessor the cost of removal of any of Lessee's refuse and
rubbish in excess of that usually attendant upon the use of the Demised Premises
as offices.
(6) Lessor shall replace, as necessary, the fluorescent tubes
in the standard lighting fixtures installed by Lessor.
(B) In accordance with Paragraph 3 of this Lease, as Additional Rent,
Lessee shall pay its share of all charges for heat, water, light, gas,
electricity, sewer, garbage, fire protection and any other utilities and/or
services used or consumed on or supplied to the Building and not separately
metered and charged to the Demised Premises or any other premises in the
Building. Lessee shall be solely responsible for and shall promptly pay when due
all charges for telephone or any other utilities or services separately metered
or charged to the Demised Premises. Lessor may impose a reasonable charge for
any utilities and services, including without limitation, air conditioning,
electric current and water, required to be provided by Lessor by reason of any
substantial recurrent use of the Demised Premises at any time other than Normal
Building Hours, or any use beyond what Lessor agrees to furnish as described
above, or special electrical, cooling and ventilating needs created in certain
areas by hybrid telephone equipment, computers and other similar equipment or
uses. At Lessor's option, separate meters for such utilities and services may be
installed for the Demised Premises, and Lessee upon demand therefor, shall
immediately pay Lessor for the installation, maintenance or repair of such
meters.
(C) Lessee agrees to cooperate fully at all times with Lessor and to
abide by all regulations and requirements which Lessor may prescribe for the use
of the above utilities and services. Any failure to pay any excess costs as
described above shall constitute a breach of the obligation to pay rent under
this Lease and shall entitle the Lessor to the rights herein granted for such
breach.
(D) Lessor shall not be liable for, and Lessee shall not be entitled
to, any abatement or reduction of rent by reason of Lessor's failure to furnish
any of the foregoing when such failure is caused by accident, breakage, repairs,
strikes, lock-outs or other labor disturbance or labor dispute of any character,
governmental regulation, moratorium or other governmental action, inability by
exercise of reasonable diligence to obtain electricity, water or fuel, or by any
other cause beyond Lessor's reasonable control, nor shall any such failure,
stoppage or interruption of any such service be construed either as an eviction
of Lessee, or relieve Lessee from the obligation to perform any covenant or
agreement. In the event of any failure, stoppage or interruption thereof,
however, Lessor shall use reasonable diligence to resume service promptly.
(E) Notwithstanding anything hereinabove to the contrary, Lessor
reserves the right from time to time to make reasonable and nondiscriminatory
modifications to the above standards for utilities and services.
(F) All telephone and telecommunications services desired by Lessee
shall be ordered and utilized by Lessee at its sole cost and expense. Lessee
shall separately contract with a telephone or telecommunications provider (a
"Provider") to provide telephone and telecommunications services to the Demised
Premises. If Lessee desires to utilize the services of a Provider whose
equipment is not presently servicing the Building, such Provider must obtain the
written consent of Lessor before it will be permitted to install its lines or
other equipment within the Building. Lessor's consent to the installation of
lines or equipment within the Building by any Provider shall be evidenced by a
written agreement between Lessor and the Provider, which contains terms and
conditions acceptable to Lessor in its sole discretion. Lessor's refusal for any
reason whatsoever to consent to any prospective Provider shall not be deemed a
default or breach by Lessor of its obligations under this Lease. Lessor makes no
warranty or representation to Lessee to the suitability, capability or financial
strength of any Provider whose equipment is presently serving the Building, and
Lessor's consent to a Provider whose equipment is not presently serving the
Building shall not be deemed to constitute such a representation or warranty. To
the extent the service by a Provider is interrupted, curtailed or
discontinued for any reason whatsoever, Lessor shall have no obligation or
liability in
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connection therewith unless the interruption is caused by the negligence or
intentional misconduct of Lessor, and it shall be the sole obligation of Lessee
at its expense to obtain substitute service. The provisions of this paragraph
are solely for the benefit of Lessee and Lessor, are not for the benefit of any
third party, specifically including without limitation, no telephone or
telecommunications provider shall be deemed a third party beneficiary hereof.
ATTORNEYS' FEES
22. In the event of any legal action or proceeding brought by either
party against the other arising out of this Lease the prevailing party shall be
entitled to recover reasonable attorneys' fees and costs incurred in such action
and such amount shall be included in any judgment rendered in such proceeding.
DEFAULT
23. The occurrence of any one or more of the following events shall
constitute a breach of this Lease and default by Lessee:
(A) if Lessee fails to make prompt payment of rent or any
amounts due Lessor in connection with Lessee's occupancy of the Demised
Premises; or
(B) if Lessee fails to keep or perform any of the covenants or
conditions of this Lease or rules or regulations in connection therewith, other
than the making of any payment when due; or
(C) if a receiver shall be appointed for Lessee's property or
any part thereof, or if a petition is filed by Lessee for an arrangement with
his creditors under the United States Bankruptcy Act, or if Lessee shall be
declared bankrupt or insolvent according to law, or if any assignment of
Lessee's property shall be made for the benefit of creditors.
With respect to a default occurring under (A) above, Lessee shall have five (5)
days following receipt of written notice from Lessor within which to cure any
such default. With respect to a default arising under subparagraph (B) above,
Lessee shall have twenty (20) days following receipt of written notice from
Lessor within which to cure any such defaults; provided, if the nature of the
default is such that the cure cannot reasonably be cured within such twenty (20)
day period, the cure period shall be extended for so long as may be reasonably
necessary to cure the default (but for no more than an additional sixty (60)
days) if (i) Lessee commences the cure within the initial twenty (20) day period
and thereafter diligently prosecutes the cure to completion in good faith; and
(ii) Lessee furnishes Lessor with such assurances and indemnities as Lessor may
reasonably require to insure completion thereof and fully and completely protect
Lessor from any loss or liability resulting from any such default or any delay
by Lessee in curing the default. The notice periods provided for above shall
include, but not be in addition to, any notice periods otherwise required by RCW
59.12, as now or hereafter amended, or any legislation in substitution thereof.
REMEDIES
24. In the event of a default or breach not cured within the applicable
cure period, if any, Lessor may at any time, without waiving or limiting any
other right or remedy reenter and take possession of the Demised Premises,
terminate this Lease and/or pursue any remedy allowed by law. In the event of
any entry or taking possession of the Demised Premises by Lessor, Lessor shall
have the right but not the obligation to remove therefrom all or any part of the
personal property of Lessee located therein and may place the same in storage in
a public warehouse at the cost and risk of Lessee. If Lessor elects to reenter
the Demised Premises and terminate this Lease, Lessor may recover from Lessee as
damages the following: (i) the worth at the time of award of any unpaid rental
which had been earned at the time of such termination; plus (ii) the worth at
the time of award of the amount by which the unpaid rental which would have been
earned after termination until the time of award exceeds the amount of such
rental loss Lessee proves could have been reasonably avoided; plus (iii) the
worth at the time of award of the amount by which the unpaid rental for the
balance of the term after the time of award exceeds the amount of such rental
loss that Lessee proves could be reasonably avoided; plus (iv) any other amount
necessary to compensate Lessor for all the detriment approximately caused by
Lessee's failure to perform its obligations under this Lease, including but not
limited to any costs or expenses incurred by Lessor in (a) retaking possession
of the Demised Premises, including attorneys' fees and costs, (b) maintaining or
preserving the Demised Premises after Lessee's default, (c) preparing the
Demised Premises for reletting to a new tenant, including repairs or alterations
to the Demised Premises for such reletting, (d) leasing commissions and (e) any
other costs necessary or appropriate to relet the Demised Premises; plus (v) at
Lessor's election, such other amounts in addition to or in lieu of the foregoing
as may be permitted from time to time by the laws of the State of Washington. As
used in item (i) and (ii) above, "worth at the time of award" is computed by
allowing interest at the interest rates specified in Paragraph 41 below. As used
in item (iii) above, the "worth at the time of award" is computed by using the
discount rate of six percent (6%). If Lessor retakes possession, Lessor shall
have the right to let any other available space in the Building before reletting
or attempting to relet the Demised Premises and such action shall not relieve
Lessee of any of its obligations hereunder. All remedies provided herein are
cumulative and are in addition to those provided by law.
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CUMULATION OF REMEDIES - NO WAIVER
25. No right to remedy herein expressly conferred upon or reserved to
Lessor is intended to be exclusive of any other right or remedy, and each and
every right and remedy shall be cumulative and in addition to any other right or
remedy given hereunder or now or hereafter existing at law or in equity or by
statute. The failure of Lessor or Lessee to insist in any one or more instances
upon the strict performance by the other party of any of the covenants of this
Lease or to exercise any option herein contained shall not be construed as a
waiver or a relinquishment for the future of any such covenant or option. The
receipt by Lessor of rent with the knowledge of a breach of any covenant or
agreement hereof shall not be deemed a waiver of such breach, and no waiver by
either party of any provision of this Lease shall be deemed to have been made
unless expressed in writing and signed by the other party or its duly authorized
agent.
LIGHT AND AIR
26. This Lease does not grant any right of access to light, air, or
view, over the property, and Lessor shall not be liable for any diminution of
such light, air, or view by any adjacent structure.
REPAIR
27. In the event Lessor, during the term of this Lease, deems it
necessary to repair, alter, remove, reconstruct or improve any part of the
Demised Premises or the Building, then such repairs, alterations, removals,
reconstructions or improvements may be made by and at the expense of Lessor
without any interference or claim for damages by Lessee, but there shall be such
an abatement or adjustment of rent as shall be just and in proportion to the
interference with Lessee's occupation of the Demised Premises, unless such
repairs or alterations. are made at Lessee's request, or necessitated by reason
of Lessee's negligence or the negligence of Lessee's employees, agents or
invitees.
HOLDING OVER
28. Unless otherwise agreed in writing by Lessor and Lessee, any
holding over by Lessee after the expiration of the Lease Term consented to in
advance in writing by Lessor, shall be construed as a tenancy for month-to-month
on the terms and conditions set forth herein at such rental rate as may be
agreed upon by Lessor and Lessee. Any such holdover tenancy consented to by
Lessor may be terminated by either party upon thirty (30) days written notice to
the other party, unless otherwise agreed in writing. Lessor agrees it will not
unreasonably withhold its consent to a proposed holdover by Lessee, however
Lessee agrees it shall not be unreasonable for Lessor to withhold its consent to
a holdover if Lessor has leased all or any portion of the Demised Premises to
another person or entity or if Lessor believes it is necessary to have
possession of the Demised Premises in order to relet it. Any holding over by
Lessee after the expiration of the Lease Term without Lessor's consent shall be
deemed a tenancy at will, terminable at any time by Lessor, at a rental rate
equal to one and one-half (1 1/2) times the Base Rent and Additional Rent
payable by Lessee during the last month rent is payable by Lessee pursuant to
this Lease. Acceptance by Lessor of rent after such expiration or earlier
termination shall not constitute a consent to a holdover hereunder or result in
a renewal or extension of the Lease term. The foregoing provisions of this
Paragraph are in addition to and do not affect Lessor's right of re-entry or any
other rights of Lessor hereunder or as otherwise provided by law.
LIENS
29. Lessee shall keep the Demised Premises and the Building free from
any liens arising out of any work performed, materials furnished or obligations
incurred by Lessee. Lessor shall have the right to post or keep posted on the
Demised Premises any notices that may be provided by law or which Lessor may
deem to be proper for the protection of the Lessor, the Demised Premises and the
Building from such liens. Nothing in this Lease shall be deemed or construed in
any way as constituting the consent or request of Lessor, express or implied, by
inference or otherwise, to any contractor, subcontractor, laborer or materialman
for the performance of any labor or the furnishing of any materials for any
specific improvement, alteration or repair to the Demised Premises or any part
thereof, nor as giving Lessee any right, power or authority to contact for or
permit the rendering of any services or the furnishing of any materials that
would give rise to the filing of any lien against the fee of the Demised
Premises. If any such lien shall at any time be filed against the Demised
Premises, Lessee shall cause the same to be discharged of record within twenty
(20) days after the date of filing the same. Any amount paid by Lessor for any
of the expenses or fees incurred or arising from such lien, including all
reasonable legal or other expenses of Lessor, shall be repaid by Lessee to
Lessor on demand with interest at the interest rate specified in Paragraph 41
below.
FURNITURE AND BULKY ITEMS
30. Safes, furniture or bulky items shall be moved in or out of the
Demised Premises only at such hours and in such manner as shall least
inconvenience other tenants, as Lessor shall decide. No safe or other articles
of over 1000 pounds shall be moved into the Demised Premises without the consent
of the Lessor. Lessor shall have the right to fix the position of any article of
such weight in the Demised Premises.
REGULATIONS
31. Lessor may make and enforce regulations appropriate for maintenance
and management of the Building including but not limited to regulations for
order, cleanliness and security, but said regulations shall not be inconsistent
with the terms, covenants and conditions of this Lease. Lessor shall not be
responsible to Lessee for the nonperformance by any other tenant or occupant of
any said rules or regulations.
PREPARATION FOR OCCUPANCY
32. Lessor shall cause the Demised Premises to be improved with the
tenant improvements in accordance with the Workletter. All improvements made in
connection with the preparation of the
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Demised Premises for occupancy shall be and remain the property of Lessor.
Lessee shall pay all costs of furnishing, installing or connecting fixtures and
any equipment required by Lessee.
POSSESSION
33. If Lessor for any reason cannot deliver possession of the Demised
Premises to Lessee on or before the Target Commencement Date, then except as
provided below, Lessor shall not be subject to any liability therefor; nor shall
such failure affect the validity of this Lease or the obligations of Lessee
hereunder; provided Lessee shall not be obligated to pay rent until possession
of the Demised Premises is tendered to Lessee. Notwithstanding the foregoing, if
Lessor has not delivered possession of the Demised Premises within one hundred
twenty (120) days from the Target Commencement Date, then at Lessee's option, to
be exercised within thirty (30) days after the expiration of said 120-day
period, this Lease shall terminate and upon Lessor's return of any monies
previously deposited by Lessee the parties shall have no further rights or
liabilities towards each other. Notwithstanding the foregoing sentence, if
Lessor is unable to deliver possession of the Demised Premises to Lessee within
the 120-day period due to delays caused by Lessee or material shortages, labor
strikes, or other reasons beyond Lessor's control, the 120-day period shall be
extended by the number of days of delay experienced by Lessor. If Lessor is
unable to deliver possession of the Demised Premises to Lessee prior to the
Target Commencement Date, and such failure is the result of causes within the
reasonable control of Lessor, if and to the extent Lessee (or Group Data
Administrators, Inc.) is required to pay holdover rent at its current premises,
at 915 118th S.E. in Bellevue, Washington, in excess of the rent currently
payable by Lessee pursuant to its lease thereof, Lessor shall reimburse Lessee
(or Group Data Administrators, Inc.) for the amount of such excess rent on a
monthly basis upon the presentation to Lessor of an invoice specifying the
amount thereof; provided, Lessee shall use reasonable efforts to negotiate with
its Lessor a holdover rent not in excess of that which Lessee is presently
paying pursuant to its lease.
DEMOLITION
34. In the event at any time Lessor decides to demolish the Building,
or substantially change the character of the Building, then Lessor may cancel
this Lease upon six (6) month's prior written notice to Lessee. Upon date of
actual termination, all payments due for unamortized tenant improvements
following said termination date shall be forgiven in their entirety by Lessor
and Lessee shall have no obligation pursuant to Paragraph 6 of this Lease to
remove tenant improvements. If Lessor so elects to terminate this Lease, on or
before the effective date of the termination, Lessor shall pay to Lessee an
amount equal to the unamortized balance of the Lessee Improvement costs, if any,
paid by Lessee pursuant to Exhibit C attached. Such costs shall be amortized
over the initial term of this Lease on a straight-line basis without interest.
SUBORDINATION
35. Lessee agrees that upon request of Lessor it will subordinate its
rights hereunder to the lien of any Mortgage, Ground Lease or Deed of Trust now
or hereafter enforced against the Land or the Building of which the Demised
Premises are part and to all events made or hereafter to be made upon the
security thereof. Lessee agrees to execute such documents that may be necessary
to effectuate the provisions of this article.
ESTOPPEL CERTIFICATE
36. At any time upon ten (10) days prior written request by Lessor,
Lessee shall promptly execute, acknowledge and deliver to Lessor, a certificate
certifying (a) that this Lease is unmodified and in full force and effect or, if
there had been modifications, that this Lease is in full force and effect as
modified, and state the date and nature of each modification; (b) the date, if
any, to which rental and other sums payable hereunder have been paid; (c) that
no notice has been received by Lessee of any default which has not been cured,
except as to default specified in said certificate; and (d) such other matters
as may be reasonably requested by Lessor. Any such certificate may be relied
upon by any prospective purchaser, mortgagee or beneficiary of a Deed of Trust
placed on or against the building or on or against Lessor's interest or estate
or any part thereof.
RESERVED
37. Reserved.
ARTICLE HEADINGS
38. The article headings throughout this instrument are for convenience
in reference only, and the words contained therein shall in no way be held to
explain, modify, amplify or aid in the interpretation, construction or meaning
of the provisions of this Lease.
NOTICE
39. Any notice which may be given by either party to the other, whether
required under the terms of this Lease or by law, shall be conclusively deemed
to be sufficiently given when deposited in the United States mail, postage
prepaid, registered or certified, addressed if to the Lessor at: The Estate of
▇▇▇▇▇ ▇▇▇▇▇▇▇▇, c/o The Seneca Real Estate Group, Inc., ▇▇▇▇▇ ▇.▇. ▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, and if to Lessee: at the Premises, or at such
other address which the parties may from time to time designate.
PARTIES AFFECTED
40. The rights, liabilities and remedies provided for herein shall
extend to the heirs, legal representatives, successors and as far as the terms
of this Lease permit, assigns of the parties hereto. The words "Lessor" and
"Lessee" and their accompanying verbs or pronouns, whenever used in this Lease
shall apply equally to all persons, firms or corporations which may be or become
parties hereto.
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TIME
41. TIME IS OF THE ESSENCE OF THIS AGREEMENT. Any amount due from
Lessee to Lessor under this Lease which is not paid within five (5) days of the
date due, shall bear interest from the date such payment due until paid
(computed on the basis of a 365-day year) at the lesser of (a) the maximum and
lawful rate per annum, or (b) the prime business lending rate publicly quoted
from time to time by Seattle-First National Bank, Seattle main branch, plus
three percentage points (3%) per annum. If Seattle-First National Bank ceases to
quote a prime rate or similar rate, Lessor shall select the prime rate or
similar rate quoted by another national bank having an office in Seattle,
Washington.
ENTIRE
AGREEMENT
42. This Lease and the exhibits hereto constitute the entire agreement
between the parties hereto and no modification of this Lease shall be binding
unless evidenced by an agreement in writing signed by the Lessor and Lessee.
AFFILIATED COMPANIES
43. Notwithstanding Paragraph 5 above, any corporation, partnership,
limited liability company or other entity in which ▇▇▇ ▇. ▇▇▇▇▇▇▇ has an
ownership interest may occupy portions of the Demised Premises pursuant to
subleases, provided Lessor receives written notice of the sublease within thirty
(30) days after the date the sublease is to become effective, and further
provided the business of the proposed sublessee is related to the primary
business of Lessee (i.e., the sale, brokerage and servicing of medical, dental,
life and disability insurance for groups and individuals). Any such sublease
must contain terms and conditions reasonably acceptable to Lessor, including
provisions requiring the sublessee to maintain insurance and indemnification
obligations comparable to those required pursuant to Paragraphs 8 and 9 of this
Lease.
PARKING
44. Throughout the term of this Lease, Lessee shall be entitled to one
(1) parking permit for unreserved monthly parking in the Skyline Tower parking
garage, per each one thousand (1,000) rentable square feet of space from time to
time constituting the Demised Premises. Such parking permits shall be made
available to Lessee at the then current charge for unreserved monthly parking in
the Skyline Tower garage, as such rates may change from time to time, however
during the initial twelve (12) months of the Lease Term, parking will be made
available to Lessee at one-half (1/2) of the other prevailing rate charged for
unreserved monthly parking in the Skyline Tower garage. Lessee acknowledges the
current charge for unreserved monthly parking in the Skyline Tower garage is
$80.00 per month, including applicable Washington State sales taxes. Lessee's
parking privileges in the Skyline Tower parking garage shall be subject to
whatever parking methods are then being used in the Skyline Tower parking garage
(e.g, self parking, valet parking, stack parking, etc.) and subject to any rules
and regulations applicable to parking in the Skyline Tower garage. Lessor will
provide Lessee with validation stickers so that its clients and visitors may
park in the Skyline Tower at no charge for up to thirty (30) minutes so long as
Lessor generally makes such validation stickers available to substantially all
of the tenants of the Building.
PERSONAL
GUARANTEE
45. ▇▇▇ ▇. ▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ will personally guarantee a
portion of Lessee's obligations under this lease pursuant to a Guaranty of Lease
in the form attached to this Lease as Exhibit D.
PARTIAL
TERMINATION
46. So long as Lessee is not in default under this Lease, Lessee shall
have the right to terminate this Lease for up to one-half (1/2) of the rentable
area of the Demised Premises effective as of the end of the thirty sixth (36th)
full calendar month of the Lease Term, or as of the end of the sixtieth (60th)
full calendar month of the Lease Term, if Washington state or federal health
care legislation has been enacted which causes a demonstrable reduction in
Lessee's annual revenues by more than twenty five percent (25%) from the most
recent calendar year prior to the enactment of such legislation. To so terminate
this Lease pursuant to this ▇▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ must give Lessor written notice
between June 1 and August 31 of the year prior to the date the cancellation is
to be effective. The configuration of the Demised Premises following such a
termination shall be subject to the mutual agreement of Lessor and Lessee. In
addition, Lessee must pay to Lessor at least thirty (30) days prior to the date
the termination is to be effective, an "Early Termination Fee" calculated
pursuant to the following sentence. The Early Termination Fee shall be equal to
the sum of (i) the unamortized balance of a pro rata portion (calculated based
on the ratio between the rentable area of the portion of the Demised Premises as
to which this Lease is terminated and the original rentable area of the Demised
Premises) of all costs and expenses incurred by Lessor in connection with this
Lease, specifically including all costs associated with the design, permitting
and construction of the tenant improvements to the Demised Premises, the cost of
relocating any existing tenants on the fifth (5th) floor of the Building to
accommodate this Lease, and all brokerage commissions incurred by Lessor in
connection with this Lease ("Lessor's Costs"), amortized using an interest rate
of nine percent (9%) per annum, and (ii) the cost of constructing a demising
wall between the portion of the Demised Premises as to which the termination
applies and the remainder of the Demised Premises. If Lessee so elects to
terminate this Lease, Lessor and Lessee shall be relieved of their respective
obligations and duties under this Lease for the applicable portion of the
Demised Premises, effective as of the termination date, except for indemnities
and other obligations which are intended to survive the expiration or earlier
termination of this Lease, or any obligations either may have to the other which
arise prior to the effective date of termination.
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EXPANSION OPTION
47. Lessee shall have a right of first offer to lease any remaining
space on the fifth (5th) floor of the Building which becomes available for lease
(the "RFO Space"). Lessee's right to lease RFO Space shall be subject and
subordinate to any expansion or other such rights as other tenants of the
Building may have in and to the RFO Space as of the date of this Lease. Prior to
leasing any RFO Space to any third party (other than a tenant with existing
rights in and to the RFO Space), Lessor will first advise Lessee in writing of
the RFO Space available and the date the RFO Space will be available for the
commencement of tenant improvement work. Lessee shall have three (3) business
days after receiving such notice from Lessor to notify Lessor in writing that
Lessee desires to expand the Demised Premises to include all of the offered RFO
Space. If Lessee does not timely notify Lessor of Lessee's desire to lease the
subject RFO Space, Lessor shall be free to lease such space to any person or
entity on whatever terms or conditions Lessor desires. If Lessee timely notifies
Lessor of Lessee's desire to lease the subject RFO Space, this Lease shall be
amended to provide for the expansion of the Demised Premises to include the
subject RFO Space. Upon the expansion of the Demised Premises pursuant to this
Paragraph 47, the Demised Premises will be expanded to include the RFO Space and
Lessee will take occupancy and commence paying rent thereon on the earlier of
the following dates (the "Expansion Date"): (i) the date Lessee commences the
beneficial use and occupancy of the applicable RFO Space for purposes other than
the construction of tenant improvements, or (ii) three (3) business days after
the improvements to the applicable RFO Space are substantially complete. All of
the terms and conditions of this Lease shall be applicable to RFO Space added to
the Demised Premises pursuant to this Paragraph 47, including rental rate and
term. For improvements to RFO Space, Lessor will make a tenant improvement
allowance available to Lessee in an amount equal to $.20 (i.e., $16.88 + 84) per
full calendar month remaining in the Lease Term following the applicable
Expansion Date. Improvements to RFO Space added to the Demised Premises will be
made in accordance with the procedures set forth in the Workletter, to the
extent applicable.
EXTENSION OPTION
48. So long as Lessee is not then in default under this Lease, on the
terms and conditions stated in this ▇▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ shall have the option
to extend the term of this Lease one (1) additional eighty-four (84) month
period (the "Additional Term"). To exercise its option to extend this Lease for
the Additional Term, Lessee must deliver to Lessor a written notice (an "Option
Notice") exercising its renewal option at least twelve (12) months (but not more
than eighteen (18) months) prior to the date the then Lease Term will expire,
together with a then current financial statement of Lessee. If such financial
statement(s) show a material adverse change in Lessee's financial condition
since the date of this Lease, at Lessor's option, Lessee's exercise of its
extension option shall be null and void. The extension option granted to Lessee
pursuant to this Paragraph 48 is personal to Lessee and may not be exercised by
or for the benefit of any assignee or sublessee of Lessee (other than a
sublessee permitted pursuant to Paragraph 43 above). All of the terms and
conditions of this Lease shall apply during the Additional Term except (i) the
base annual rent shall be the "fair market rent" (defined below) for the Demised
Premises as agreed to by Lessor and Lessee or determined by arbitration as set
forth below; (ii) unless otherwise agreed by Lessor in writing, there shall be
no further renewal options after the commencement of the Additional Term; and
(iii) Lessor shall have no tenant improvement obligations with respect to the
Demised Premises. When the rental rate for the Additional Term is determined,
whether by agreement of the parties or pursuant to arbitration as provided
below, Lessor and Lessee shall enter into a lease extension agreement setting
forth the new base rent for the Demised Premises and such other terms as may be
applicable. If at the time Lessee delivers the Option Notice to Lessor, or at
any time between such date and the commencement date of the Additional Term,
Lessee defaults under this Lease and fails to cure its default within the
applicable cure period, if any, Lessor may declare the Option Notice null and
void by written notice to Lessee. The term "fair market rent" means the rate per
rentable square foot that a willing, non-equity tenant would pay in an
arms-length transaction for comparable space in the Building and in comparable
buildings in the central business district of Bellevue, Washington, for leases
having a seven (7) year term, taking into account the then condition of the
improvements in the Demised Premises. Lessor and Lessee agree the base annual
rent for the Additional Term shall be determined as follows:
(A) Lessor shall advise Lessee in writing ("Lessor's Notice") of
Lessor's determination of fair market rent not later than thirty (30) days after
receiving the Option Notice. Within thirty (30) days after receiving Lessor's
Notice, Lessee shall notify Lessor in writing ("Lessee's Notice") whether or not
Lessee accepts Lessor's determination of the fair market rent. If Lessee
disagrees with Lessor's determination of fair market rent, Lessee's Notice shall
set forth Lessee's determination of fair market rent. If Lessee fails to give
Lessee's Notice to Lessor within such thirty (30) day period, then the Option
Notice shall be deemed null and void, unless otherwise agreed in writing by
Lessor and Lessee. If Lessee does not accept Lessor's determination of fair
market rent, and Lessee has given Lessee's Notice, the parties (or their
designated representatives) shall promptly meet and attempt to agree on the fair
market rent. If the parties have not agreed on the fair market rent within
ninety (90) days after Lessor receives the Option Notice, and Lessee's renewal
option is still in effect in accordance with the terms of this paragraph, then
unless otherwise agreed in writing by the parties, the parties shall submit the
matter to arbitration in accordance with the terms of the following paragraphs.
The last day of such ninety (90) day period (as the same may be extended by
-12-
13
the written agreement of the parties) is referred to in this Lease as the
"Arbitration Commencement Date".
(B) The arbitration will be conducted by three MAI real estate
appraisers who have been active over the five (5) year period ending on the
Arbitration Commencement Date in the appraisal of downtown properties in
Bellevue, Washington. One appraiser will be selected by Lessee, one appraiser
will be selected by the Lessor, and the third appraiser will be selected by the
two appraisers so chosen. If the two appraisers chosen by the parties cannot
agree on a third appraiser within ten (10) days after the date the second
appraiser has been appointed, the third appraiser will be appointed by the
Seattle office of the American Arbitration Association upon the application of
either party. Each party shall select its appraiser within ten (10) days after
the Arbitration Commencement Date. If either party fails to select its appraiser
within such ten (10) day period, and the other party timely selects its
appraiser, then the appraiser selected by the other party shall be the sole
arbitrator for determining fair market rent.
(C) Within thirty (30) days after the selection of the third
appraiser (or if only one appraiser is to render the decision as provided in
subparagraph (ii) above, within thirty (30) days after the last day of the
above-referenced ten (10) day period), the appraiser(s) shall determine fair
market. If more than one appraiser has been appointed, the decision of a
majority of the appraisers shall control. If a majority of the appraisers do not
agree within the stipulated time period, then each appraiser shall in writing
render his or her separate determination as to fair market rent within five (5)
days after the expiration of the thirty (30) day period. In such case, the three
determinations shall be averaged to determine the fair market rent; however, if
the lowest fair market rent or the highest fair market rent is ten percent (10%)
lower or higher, as applicable, than the middle fair market rent, then the low
fair market rent and/or the high fair market rent, as applicable, shall be
disregarded and the remaining fair market rent(s) will be averaged in order to
establish the fair market rent.
(D) Both parties may submit any information to the arbitrators
for their consideration, with copies to the other party. The arbitrators shall
have the right to consult experts and competent authorities for factual
information or evidence pertaining to the determination of fair market rent. The
arbitrators shall render their decision and award in writing with counterpart
copies to each party. The arbitrators shall have no power to modify the
provisions of this Lease. The determination of the arbitrators will be final and
binding upon Lessor and Lessee. The cost of the arbitration will be paid by
Lessor if the fair market rent determined by arbitration is ninety percent (90%)
or less than the fair market rent specified in Lessor's Notice; by Lessee if the
fair market rent determined by arbitration is one hundred ten percent (110%) or
more than the fair market rent specified in Lessee's Notice; and otherwise shall
be shared equally by Lessor and Lessee.
IN WITNESS WHEREOF, the parties hereto have executed this lease as of the date
first herein written.
LESSEE: LESSOR:
BENEFITS - PLUS THE TRUSTEES UNDER THE WILL AND OF THE
ADMINISTRATORS, INC, ESTATE OF ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, DECEASED, acting
in their fiduciary and not in their individual capacities
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇ ▇. ▇▇▇▇▇▇
--------------------- -------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Chairman ▇▇▇ ▇. ▇▇▇▇▇▇, Director of Mainland
Properties
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------- -------------------------------
▇▇▇ ▇. ▇▇▇▇▇▇▇, Secretary ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Senior Asset Manager
Its
--------------------------------
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▇▇
▇▇▇▇▇▇▇ ▇
▇▇▇▇▇ #▇▇▇
PREMISES
[LEASING PLAN
400 BUILDING
5TH FLOOR]
15
STATE OF WASHINGTON )
) ss.
COUNTY OF KING )
On this 22nd day of March 1996, before me, a Notary Public in and for
the State of Washington, duly commissioned and sworn, personally appeared ▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇ and ▇▇▇ ▇. ▇▇▇▇▇▇▇, to me known to be the Chairman and Secretary,
respectively of BENEFITS - PLUS ADMINISTRATORS, INC., the corporation named in
and which executed the foregoing instrument; and they acknowledged to me that
they signed the same as the free and voluntary act and deed of said corporation
for the uses and purposes therein mentioned.
I certify that I know or have satisfactory evidence that the persons
appearing before me and making this acknowledgment are the persons whose true
signatures appear on this document.
WITNESS my hand and official seal the day and year in this certificate
above written.
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
_______________________
Signature
▇▇▇▇▇ ▇▇▇▇▇▇▇
_______________________
Print Name
NOTARY PUBLIC in and for the State of Washington,
residing at Bellevue. My commission expires 10-2-97.
STATE OF CALIFORNIA )
) ss.
COUNTY OF )
On this day of , 1996, before me, a Notary Public in and for
the State of California, duly commissioned and sworn, personally appeared ▇▇▇ ▇.
▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, known to me to be the Director of Mainland
Properties and Senior Asset Manager, respectively, of THE TRUSTEES UNDER THE
WILL AND OF THE ESTATE OF ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, DECEASED, the parties named in and
which executed the foregoing instrument; and they executed the foregoing
document, and acknowledged to me that they signed the same as their free and
voluntary act and deed of said trustees for the uses and purposes therein
mentioned.
I certify that I know or have satisfactory evidence of the persons
appearing before me and making this acknowledgment are the persons whose true
signatures appear on this document.
WITNESS my hand and official seal the day and year in this certificate
above written.
_________________________________
Signature
_________________________________
Print Name
NOTARY PUBLIC in and for the State of
California, residing at_____________.
My commission expires_______________.
14
16
EXHIBIT B
400 BUILDING
▇▇▇ - ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
LEGAL DESCRIPTION
PARCEL NO. 1:
That portion of the south 1/2 of the southwest 1/4 of the northwest 1/4 of the
northeast 1/4 of Section 32, Township 25 North, Range 5 East, ▇.▇., in ▇▇▇▇
County, Washington which lies south of the north 99 feet of said south 1/2;
EXCEPT the south 16-1/2 feet thereof, and
EXCEPT the west 30 feet thereof conveyed to King County for road by deed
recorded under Auditors File No. 913744, also EXCEPTING that portion thereof
lying within the south 100.00 feet of the north 199.00 feet of the west 230.00
feet of the south 1/2 of the southwest 1/4 of the northwest 1/4 of the northeast
1/4 of said section; and
PARCEL NO. 2:
The west 230 feet of the south 100 feet of the north 199 feet of the south 1/2
of the southwest of the northwest 1/4 of the northeast 1/4 of Section ▇▇,
▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇ ▇▇▇▇, ▇.▇. in ▇▇▇▇ County, EXCEPT the west 30 feet
thereof conveyed to King County for road by deed recorded under Auditor's File
No. 913744.
17
EXHIBIT C
TENANT IMPROVEMENT WORKLETTER
This Workletter is attached to and a part of that certain
Lease (the "Lease") between THE TRUSTEES UNDER THE WILL AND OF THE ESTATE OF
▇▇▇▇▇ ▇▇▇▇▇▇▇▇, DECEASED ("Lessor"), and BENEFITS - PLUS ADMINISTRATORS, INC.
("Lessee"). The purpose of this Workletter is to set forth how the Tenant
Improvements (defined below) to the Demised Premises are to be constructed and
designed, who will be responsible for constructing the Tenant Improvements, who
will pay for the Tenant Improvements and the time schedule for completion of the
Tenant Improvements. Lessor and Lessee hereby agree as follows:
1. Defined Terms. Unless otherwise defined in this Workletter,
capitalized terms used in this Workletter shall have the same meanings given
such terms in the Lease. The following capitalized terms shall have the meanings
set forth below:
"Allowance" means the amount of $111,178.
"Architect" means ▇▇▇▇▇▇ ▇▇▇▇▇ & Associates, Inc.
"Business Day" means any day other than a Saturday, Sunday or other day
on which United States national banks in Seattle, Washington are authorized or
required by law to be closed for business.
"Contractor" means TCI General Contractors Inc. or such other
contractor as may be agreed upon by the parties.
"Cost of the Work" means all costs of completing the Work, including
the Contractor's fees, design fees, Lessor's coordination fees, demolition
costs, the cost of installing computer cabling and communications equipment,
permit fees and any applicable taxes.
"Plans and Specifications" means the space plan, detailed plans and
specifications (including without limitation all mechanical, electrical and
plumbing drawings) and working drawings pursuant to which the Tenant
Improvements will be completed. The Plans and Specifications shall be compatible
with the design, construction and equipment of the Building, and shall show all
partition locations, plumbing locations, air conditioning system and duct work,
special air conditioning requirements, reflected ceiling plans, office equipment
locations, and special security systems, if any.
"Ready for Occupancy" or "Substantial Completion" means complete to the
extent Lessee may reasonably use and occupy the Demised Premises for the purpose
for which the same were intended, as evidenced by the issuance of a Standard AIA
Certificate of Substantial Completion executed by the Architect and issuance of
a certificate of occupancy (or other governmental approval permitting the
occupancy of the Demised Premises by Lessee) by the City of Bellevue, subject to
minor details of construction, decoration and mechanical adjustments that remain
to be completed by Lessor, which do not materially interfere with Lessee's use
of the Demised Premises.
"Tenant Improvements" means those certain improvements to the Demised
Premises to be described in the Plans and Specifications, as the same may be
modified pursuant to Paragraph 7 of this Workletter, including all items of
Work, including labor and materials, that are utilized directly or indirectly in
altering, repairing, improving, adding to, modifying or otherwise changing the
Demised Premises to accommodate Lessee's occupancy.
"Lessee's Representative" means the individual designated by Lessee as
its tenant improvement representative pursuant to Paragraph 10 of this
Workletter.
"Work" means construction of the Tenant Improvements in accordance with
the Plans and Specifications, as the same may be modified pursuant to Paragraph
7 of this Workletter.
2. Preparation of Plans and Specifications.
a.Lessee shall cause the Plans and Specifications to be prepared by
Architect and submitted to Lessor or on before the Plan Submittal Date set forth
in Paragraph 6 below. Lessee shall provide Lessor with at least two (2) complete
sets of the Plans and Specifications. Lessor shall have ten (10) Business Days
after receiving the Plans and Specifications to approve the Plans and
Specifications or provide Lessee with its comments. Lessee shall then have five
(5) Business Days after receiving Lessor's comments to revise and resubmit the
Plans and Specifications to Lessor. Lessor shall have five (5) Business Days
after receiving the revised Plans and Specifications to either approve or
disapprove the revised Plans and Specifications. The process outlined in the
preceding two sentences shall be repeated until Lessor and Lessee have mutually
agreed on the Plans and Specifications. The final approved Plans and
Specifications must be in compliance with applicable building codes and with
insurance regulations for fire resistant Class A buildings. Lessee agrees and
1
18
understands that Lessor's review and approval of the Plans and Specifications
pursuant to this Workletter is solely to protect the interest of Lessor, and
Lessor shall not be the guarantor of nor responsible for the correctness of the
Plans and Specifications, or responsible for the compliance of the Plans and
Specifications with applicable laws.
b. Lessee shall cause the Plans and Specifications to be prepared in a
form satisfactory for submittal to the appropriate governmental authorities for
permits and licenses required for construction of the Tenant Improvements.
3. Construction of Tenant Improvements.
a. Lessor shall cause the Tenant Improvements to be constructed in
accordance with the Plans and Specifications approved by both parties in
accordance with Paragraph 2 above by the Contractor.
b. If the Cost of the Work exceeds the amount of the Allowance, Lessor
will so notify Lessee and Lessee shall pay the amount of the difference on the
later of (i) the Commencement Date of the Lease, or (ii) ten (10) days after
written notice from Lessor of the amount due from Lessee.
4. Acceptance of Demised Premises. Lessor will notify Lessee when the
Tenant Improvements are Ready for Occupancy. Within three (3) Business Days
after receiving such notice, and prior to move-in of any furniture, fixtures or
equipment, and again not more than twenty (20) days after Lessee occupies the
Demised Premises, Lessee shall inspect the Demised Premises for any deficiencies
in the Work. A "punchlist" of all the deficiencies in the Work shall be prepared
and agreed upon by both Lessor and Lessee. Lessor will correct defective items
stated in the punchlist which are the responsibility of Lessor or the
Contractor. If Lessee does not so provide Lessor with a punchlist prior to
occupying the Demised Premises or within twenty (20) days thereafter, Lessee
shall be deemed to have accepted the Demised Premises and the Tenant
Improvements in their then present condition, except for latent defects not
reasonably discoverable upon an inspection of the Demised Premises. The
existence of minor punchlist items shall not postpone the Commencement Date of
the Lease or result in a delay or abatement of Lessee's obligation to pay rent
or give rise to a damage claim against Lessor. Lessor agrees to complete all
punchlist items which are Lessor's or the Contractor's responsibility within
forty five (45) days after receiving the final punchlist (or longer if
reasonably necessary).
5.Completion and Rental Commencement Date
a. Notwithstanding the Target Commencement Date of the Lease, Lessee's
obligation for the payment of rent under the Lease shall not commence until the
Demised Premises are Ready for Occupancy; provided, if Lessor is delayed in
substantially completing the Work as a result of delays caused by Lessee, then
Lessee's obligation to pay rent under the Lease shall commence on the date the
Tenant Improvements would have been Ready for Occupancy except for the delays
caused by Lessee as reasonably determined by Lessor and the Contractor.
b. For purposes of this Workletter, the phrase "delays caused by Lessee"
means any delay that Lessor may encounter in performance of the Work as a result
of (i) delays resulting from changes in or additions to the approved Plans and
Specifications or the Tenant Improvements which are requested by Lessee; (ii)
delays by Lessee in the submission of information (including the Plans and
Specifications) required of Lessee pursuant to this Workletter, or the giving of
authorizations or approvals within any time limits set forth in this Workletter;
(iii) delays due to the postponement of any of the Work at the request of
Lessee; or (iv) delays otherwise attributable to the acts or omissions of Lessee
or its employees, agents or contractors.
6. Schedule. Lessee and Lessor hereby agree to make reasonable efforts to
meet all of the deadlines included in the schedule detailed below:
Date
Plan Submittal Date March 12, 1996
Acceptance of Space/Preparation
of Initial Punchlist May 29, 1996
Target Occupancy Date June 1, 1996
7. Changes In Work. Lessee shall have the right to request, in writing,
changes to the Plans and Specifications and to the Work, subject to Lessor's
prior approval. Lessor shall notify Lessee in writing of any additional costs
and any construction delays attributable to such change and whether or not
Lessor approves or disapproves of the requested change. Lessor may condition its
approval of any change on receipt of written confirmation from Lessee within
three (3) Business Days after receiving Lessor's notice, that Lessee will pay
the additional cost of making the change and any costs Lessor will incur as a
result of any delays. If Lessee fails to deliver Lessor written notice that it
still desires the requested change within such three (3) Business Day period,
Lessee shall be deemed to have withdrawn its request for the change. Each change
order shall include a recap of the total costs of the Work and shall reference
all changes made up to the date of such change order. Lessee
2
19
.
shall be responsible for paying any additional costs in the Work resulting from
any changes in the Work requested by Lessee.
8.Quality of Construction. All Work shall be done by Contractor on
behalf of Lessor in a good and workmanlike manner. Architect shall obtain all
necessary permits, licenses and approvals including building permits, from such
governmental authorities for such construction. Lessee's Representative shall
have access to the construction in progress and shall be notified of all
construction progress meetings with Lessor, Contractor and/or the Architect.
9.Early Entry. With Lessor's prior written approval, Lessee and
Lessee's contractors shall have the privilege of entering into the Demised
Premises prior to their being Ready for Occupancy for purposes of cable,
telephone and furniture installation; provided that such entry or work does not
interfere with the construction of the Tenant Improvements by Contractor. No
payment of minimum rent or additional rent shall be required of Lessee for the
aforesaid entry or entries by Lessee or its contractors prior to the Substantial
Completion of the Tenant Improvements. Lessee hereby indemnifies, and shall hold
harmless Lessor, its officers, directors, agents, employees and contractors from
and against all claims, damages, losses, expenses for bodily injury or property
damage, including attorneys' fees, arising out of or resulting from Lessee's
early entry into the Demised Premises prior to their being Ready for Occupancy
pursuant to this Paragraph 9, including any expenses incurred by Lessor for
delays in the completion of the Work caused by such early entry, and for any
damages to the Work caused by Lessee or Lessee's contractors prior to the
Demised Premises being Ready for Occupancy.
10.Tenant Improvement Representative. Prior to the commencement of the
Work, Lessee shall designate in writing one individual who shall be Lessee's
Representative during the Work. Lessor and Contractor shall be entitled to rely
on the decisions of Lessee's Representative regarding the Work (and the
decisions of Lessee's Representative shall be binding upon Lessee) until Lessor
and Contractor have received written notice from Lessee that such person's
authority has been revoked.
11.Additional Provisions, This Workletter and the exhibits attached
hereto set forth the entire agreement of Lessor and Lessee with respect to the
completion of the Work. Neither this Workletter nor any of the provisions
contained in this Workletter may be changed or waived, except by a written
instrument signed by both parties. Any costs or expenses which Lessee is
required to pay under this Workletter (such as additional construction costs due
to changes in the Work) shall be due and payable in full upon Substantial
Completion of the Work, and the presentation to Lessee of a written statement
setting forth the amounts due from Lessee.
3
▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇-▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇ :
County of San Francisco :
On this 2nd day of April, 1996, before me, ▇▇▇▇ ▇▇▇▇▇▇▇, Notary Public,
personally appeared ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇ ▇. ▇▇▇▇▇▇, personally known to me
to be the persons whose names are subscribed to the within instrument and
acknowledged to me that they executed the same in their authorized capacities,
and that by their signatures on the instrument the persons, or the entity upon
behalf of which the persons acted, executed the instrument.
▇▇▇▇ ▇▇▇▇▇▇▇ WITNESS my hand and official seal.
COMM. No. 1051145
Notary Republic-California /s/▇▇▇▇ ▇▇▇▇▇▇▇
SAN FRANCISCO COUNTY -----------------------------
My Comm. Expires FEB 6, 1999
▇▇▇▇ ▇▇▇▇▇▇▇
Notary Public in and for the State of
[Seal] California, residing in San Francisco
DESCRIPTION OF THE ATTACHED DOCUMENT
Title and Type: Office Lease by and between the Trustees under the Will and of
the Estate of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, deceased, and Benefits - Plus Administrators, Inc.
for space at the 400 Building located in Bellevue, Washington.
Dated: March 22, 1996
Signer(s) Other Than Named Above: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Chairman, and ▇▇▇ ▇.
▇▇▇▇▇▇▇, Secretary, of Benefits - Plus Administrators, Inc.
21
GUARANTY OF LEASE
This Guaranty is made as of March 22,1996, by ▇▇▇ ▇. ▇▇▇▇▇▇▇ and ▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇ (if one person or entity "Guarantor", and if more than one person or
entity "Guarantors"), for the benefit of THE TRUSTEES UNDER THE WILL AND OF THE
ESTATE OF ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, DECEASED, acting in their fiduciary and not in their
individual capacities ("Lessor").
RECITALS:
A. Lessor has agreed to enter into a Lease dated as of March 22,
1996 (the "Lease") with Benefits Plus Administrators, Inc., a
Washington corporation ("Lessee"), for certain space (the
"Demised Premises") located in a building (the "Building")
currently known as the 400 Building, situated at ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇.▇., ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇.
B. Guarantor(s) has a financial interest in Lessee, and will
receive a material benefit from the Lease. Guarantor(s)
acknowledges Lessor would not enter into the Lease without
this Guaranty.
AGREEMENT:
In consideration of and to induce Lessor to enter into the Lease,
Guarantor(s) agrees as follows:
1. Subject to Paragraph 11 below, Guarantor(s) hereby guarantees
to Lessor the full and prompt payment of all sums, including,
but not limited to the rent, taxes, insurance, utility charges
and any and all other sums and charges payable by Lessee under
the Lease as the same may be amended from time to time, and
the full performance and observance of all the covenants,
terms conditions and agreements therein provided to be
performed and observed by Lessee. Guarantor(s) hereby
covenants and agrees to and with Lessor if Lessee or its
sublessees, successors or assigns at any time defaults in the
payment of any such sum or in the performance of any of the
terms, covenants, provisions or conditions contained in the
Lease and such default is not cured within the applicable cure
period, Guarantor(s) will immediately pay such sum or will
forthwith perform and fulfill such terms, covenants and
conditions and agreements, and will immediately pay to Lessor,
its successors and assigns all damages that may arise as a
consequence of any default by Lessee under the Lease,
including without limitation, all reasonable attorneys' fees
incurred by Lessor.
2. This is an absolute and unconditional guaranty of payment and
performance. The obligations of Guarantor(s) hereunder are
independent of the obligations of Lessee, and a separate
action or actions may be brought and prosecuted against each
Guarantor, regardless of whether an action is brought against
Lessee or any other Guarantor and regardless of whether Lessee
or any other Guarantor is joined in such action or actions,
and each Guarantor waives the benefit of any statute of
limitations affecting his, her or its liability hereunder or
the enforcement thereof. The liability of Guarantor(s)
hereunder is primary and shall not be affected or diminished
by any transfer (by sublease, assignment or otherwise) of
Lessee's interest in the Lease.
3. Guarantor(s) authorizes Lessor, without notice or demand and
without affecting any Guarantor's liability hereunder, from
time to time to (a) renew, extend, accelerate or otherwise
change the time for payments under or otherwise change the
terms of, the Lease or any part thereof; (b) take and hold
security for the payment of this Guaranty or the indebtedness
guaranteed and exchange, enforce, waive and release any such
security; (c) apply any security for the Lease or direct the
order or manner of sale thereof as Lessor in its sole
discretion may determine; (d) release or substitute any one or
more Guarantor(s); (e) modify or alter the liability of Lessee
under the Lease; or (f) settle or compromise any claim of
Lessor against Lessee. Lessor may assign the Lease and this
Guaranty in whole or in part, without notice and without in
any manner affecting Guarantor's obligations hereunder.
4. Guarantor(s) waives any right to require Lessor to (a) proceed
against Lessee; (b) proceed against or exhaust any security
held from Lessee; or (c) pursue any other remedy in Lessor's
power whatsoever. Guarantor(s) waives any defense arising by
reason of any disability or other defense of Lessee or by
reason of the cessation from any cause whatsoever of the
liability of Lessee. Until all obligations of Lessee to Lessor
under the Lease shall have been fully paid and performed,
Guarantor(s) shall have no right of subrogation, and waive any
right to enforce any remedy which Lessor now has or may
hereafter have against Lessee, and waive any benefit of, and
any right to participate in any security now or hereafter held
by Lessor. Guarantor(s) waives all presentments, demands for
performance, notices of nonperformance, protests, notices of
protest, notices of dishonor, notices of acceptance of this
Guaranty and of the existence, creation or incurring of new or
additional indebtedness and all other notices of every kind
and nature to which Guarantor(s) might otherwise be entitled
as a matter of law.
5. Any indebtedness of Lessee now or hereafter held by each or
both of the Guarantor(s) is hereby subordinated to the
indebtedness of Lessee to Lessor and such indebtedness of
Lessee to Guarantors, if Lessor so requests after a default by
Lessee under the Lease, shall be collected, enforced and
received by Guarantor(s)
-1-
22
as a trustee for Lessor and be paid over to Lessor on account of the
indebtedness of Lessee to it, but without reduction or affecting in any manner
the liability of Guarantor(s) under the other provisions of this Guaranty. Until
such time as the Lease has been paid and performed in full, Guarantor(s) agrees
not to exercise any rights any of them may now or hereafter acquire against
Lessee (whether by subrogation, reimbursement, or otherwise) arising out of
payments to Lessor hereunder. Guarantor(s) hereby waives and relinquishes in
favor of Lessor and Lessee any claim or right to payment either or both of the
Guarantor(s) may now have or hereafter have or acquire against Lessee, by
subrogation or otherwise.
6. Guarantor(s) agrees it is not necessary for Lessor to inquire into
the powers of Lessee or any officers, directors, partners or agents acting or
purporting to act on its behalf and any indebtedness made or created in reliance
upon the professed exercise of such powers shall be guaranteed hereunder.
Guarantor(s) warrants that no consent of any persons or entities or any
governmental authority is necessary for Guarantor(s) to execute, deliver and
perform this Guaranty.
7. Guarantor(s) shall pay all costs of enforcement of this Guaranty,
including Lessor's reasonable attorneys' fees and all costs and expenses of suit
and in preparation therefor and on appeal therefrom. Any sums due hereunder
which are not paid when due shall bear interest at the maximum rate permitted by
law.
8. This Guaranty shall continue in full force and effect and shall be
unaffected by any bankruptcy, reorganization or insolvency of Lessee or any
successor or assign of Lessee or any disaffirmance or rejection of the Lease
by a trustee of Lessee or any trustee of any successor or assign of Lessee. This
Guaranty may not be changed, modified, discharged or terminated orally or in any
other manner other than by an agreement in writing signed by Guarantor(s) and
Lessor. For purposes of this Guaranty, the term "Lessee" shall include any
successor, sublessee or assignee of Lessee; the term "Lessor" shall include any
successor or assignee of Lessor; and the term "Lease" shall include any
amendment, extension or renewal of the Lease, whether made with or without the
consent of Guarantor(s). This Guaranty shall be the joint and several obligation
of each of the undersigned if there be more than one, and shall bind the
individual and community property of each of them.
9. This Guaranty shall be governed by and construed and enforced under
the laws of the State of Washington, United States of America. Guarantor(s)
irrevocably submits to the jurisdiction of any state or federal court sitting in
King County, Washington, in any action or proceeding brought to enforce or
otherwise arising out of or relating to this Guaranty. Guarantor(s) waives any
objection to venue in such court and waive any claim that such form is an
inconvenient form.
10. Within twenty (20) days after Lessor's written request, each
Guarantor shall provide Lessor with a copy of his, her or its current financial
statement, prepared in accordance with generally accepted accounting principles,
consistently applied, or such other accounting practices as may be reasonably
acceptable to Lessor, and certified as true and correct by the applicable
Guarantor.
11. The maximum liability of Guarantor(s) hereunder shall be the
unamortized balance (calculated as provided below) of the sum of (i) the tenant
improvement costs incurred by Lessor in connection with the Lease, including all
costs associated with the design and permitting of the tenant improvements to
the Demised Premises, and (ii) all brokerage commissions incurred by Lessor in
connection with the Lease (collectively "Lessor's Costs"). For purposes of
calculating the unamortized balance of Lessor's Costs, so long as Lessee is not
in default under the Lease, each month during the term of the Lease, Lessor's
Costs shall be reduced by the monthly payment amount necessary to fully amortize
Lessor's Costs over the initial term of the Lease, in substantially equal
payments, at an interest rate of nine percent (9%) per annum.
IN WITNESS WHEREOF, each Guarantor has executed this Guaranty as of the
day and year first written above.
GUARANTOR(S):
/s/ ▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------
▇▇▇ ▇. ▇▇▇▇▇▇▇
Address: ▇▇▇▇▇ - ▇▇▇ ▇▇▇ ▇▇
-------------------
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
-----------------
Social Security No.: ###-##-####
-----------
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Address: 11607-72ND PL. NC
-----------------
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
------------------
Social Security No.: ▇▇▇▇▇▇▇▇▇
---------
-2-
23
STATE OF WASHINGTON )
) ss.
COUNTY OF KING )
On this 22nd day of March, 1996, before me, a Notary Public in and for
the State of Washington, duly commissioned and sworn, personally appeared ▇▇▇ ▇.
▇▇▇▇▇▇▇, known to me to be the individual named in and who executed the
foregoing document, and acknowledged to me that he signed the same as his free
and voluntary act and deed for the uses and purposes therein mentioned.
I certify that I know or have satisfactory evidence of the person
appearing before me and making this acknowledgment is the person whose true
signature appears on this document.
WITNESS my hand and official seal the day and year in this certificate
above written.
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------
Signature
▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------
Print Name
NOTARY PUBLIC in and for the State of
Washington, residing at Bellevue.
My commission expires 10-2-97.
STATE OF WASHINGTON )
) ss.
COUNTY OF KING )
On this 22nd day of March, 1996, before me, a Notary Public in and for
the State of Washington, duly commissioned and sworn, personally appeared ▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇, known to me to be the individual named in and who executed the
foregoing document, and acknowledged to me that he signed the same as his free
and voluntary act and deed for the uses and purposes therein mentioned.
I certify that I know or have satisfactory evidence of the person
appearing before me and making this acknowledgment is the person whose true
signature appears on this document.
WITNESS my hand and official seal the day and year in this certificate
above written.
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------
Signature
▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------
Print Name
NOTARY PUBLIC in and for the State of
Washington, residing at Bellevue.
My commission expires 10-2-97.