Res 1535 - Comm Lse Gordon Pol
COUNCIL BILL NO. 1961
RESOLUTION NO. 1535
A RESOLUTION ENTERING INTO A COMMERCIAL LEASE WITH IRA GORDON,
ET AL., FOR THE LEASE OF PREMISES TO BE USED AS A POLICE STATION AND
AUTHORIZING THE MAYOR TO SIGN SAID LEASE.
WHEREAS, the City of Woodburn needs an east precinct police station; and
WHEREAS, premises which are suitable for the police station have been located at 986
N. Pacific Highway; and
WHEREAS, it is in the City's interest to enter into a lease of said premises; NOW,
THEREFORE,
THE CITY OF WOODBURN RESOLVES AS FOLLOWS:
Section 1. That the City of Woodburn enter into a commercial lease with Ira Gordon,
Daniel M. Oredson, Val A. Yanagihara and Clifford B. Dart, Trustee under the Clifford B. Dart
declaration of trust dated July 6, 1989, c/o Key Investment Properties, Inc., which is affixed
hereto as Attachment" A" and, by this reference, incorporated herein.
Section 2. That the Mayor is authorized to sign said lease on behalf of the City.
Approved as to form:r(} .l'YVf- ~ if - 21- '11
City Attorney Date
Approved: ~ /
Richard Jennings, ayor '(
Passed by the Council
Submitted to the Mayor
Approved by the Mayor
Filed in the Office of the ~
ATTEST: ~ l~--sf
ary nnant City Recorder
City of Woodburn, Oregon
April 26, 1999
April 28, 1999
April 28. 1999
Apri 1 28, 1999
Page 1 - COUNCIL BILL NO. 1961
RESOLUTION NO. 1535
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COMMERCIAL LEASE
Date:
April
,1999
Between:
Ira Gordon, Daniel M. Oredson, Val A. Yanagihara and Clifford B. Dart,
Trustee under the Clifford B. Dart Declaration of Trust Dated July 6, 1989
c/o Key Investment Properties, Inc.
7150 SW Fir Loop Road, Suite 214
Tigard, OR 97223 ("Landlord")
And:
City of Woodburn, an Oregon Municipal Corporation
270 Montgomery Street
Woodburn, OR 97071
("Tenant")
Landlord leases to Tenant and Tenant leases from Landlord approximately 2861 square feet
of space, including shared common space (the "Premises") on the following described real
property on the terms and conditions stated below:
See Exhibit "A"
Street Address: Mall 99 Shopping Center, 986 N. Highway 97 , Woodburn, Oregon
Section 1.
Occupancy
1.1 Original Term. The term of this lease shall commence August 1, 1999, and
continue through July 30, 2004, unless sooner terminated as hereinafter provided.
1.2 Possession. Tenant's right to possession and obligations under the lease shall
commence on August 1, 1999, or on such later date as the work to be performed by Landlord
pursuant to section 5.2 is substantially complete and the Premises are available for possession by
Tenant if possession is not given on the opening day of the term. Landlord shall have no liability
for delays in delivery of possession and Tenant will not have the right to terminate this lease
because of delay in delivery of possession except as hereinafter provided.
Section 2. Rent
2.1 Base Rent. During the original term, Tenant shall pay to Landlord as base rent the
sum of $3488 per month. Rent, without offset or deduction, except as provided by the terms of
this Lease, shall be payable on the first day of each month in advance at such place as may be
designated by Landlord.
2.2 Security Deposit. To secure Tenant's compliance with all terms of this lease,
Tenant has paid Landlord the sum of $3488 as a deposit. The deposit shall be a debt from
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Landlord to Tenant, refundable within 30 days after expiration of the lease term or other
termination not caused by Tenant's default. Landlord may commingle the deposit with its funds
and Tenant shall not be entitled to interest on the deposit. Landlord shall have the right to offset
against the deposit any sums owing from Tenant to Landlord and not paid when due, any damages
caused by Tenant's default, the cost of curing any default by Tenant should Landlord elect to do
so, and the cost of performing any repair or cleanup that is Tenant's responsibility under this
lease. Offset against the deposit shall not be an exclusive remedy in any of the above cases, but
may be invoked by Landlord, at its option, in addition to any other remedy provided by law or this
lease for Tenant's nonperformance. Landlord shall give notice to Tenant each time an offset is
claimed against the deposit, and, unless the lease is terminated, Tenant shall within 10 days after
such notice deposit with Landlord a sum equal to the amount of the offset so that the total deposit
amount, net of offset, shall remain constant throughout the lease term.
2.3 Escalation. The base rent provided in Section 2.1 shall be increased three (3)
percent annually.
2.4 Additional Rent. All taxes, insurance costs, utility charges that Tenant is required
to pay by this lease, and any other sum that Tenant is required to pay to Landlord or third parties
shall be additional rent. If Tenant desires janitorial services, such services will be provided by
Landlord. Landlord will bill Tenant for such services on a monthly basis, together with a
reasonable allowance to Landlord for the administration and supervision of such service.
2.5 Option. If Tenant is not in default of any of its obligations under the Lease, Tenant
shall have an option to renew this Lease if it provides the Landlord written notice no less than six
(6) months before the end of the term of the Lease. The terms and conditions of the Lease for the
renewal term shall be identical to the original term, except for rent and except that Tenant will
no longer have an option to renew this Lease. Rent for the renewal term shall be the rental during
the final year of the original term, subject to escalation as provided in Section 2.3.
Section 3.
Use of the Premises
3.1 Permitted Use. The Premises shall be used as a police station, or similar City
administrative facility, and for no other purpose without the consent of Landlord, which consent
shall not be withheld unreasonably. Tenant will use and occupy the Premises in cooperation with
the Marion County. Tenant and the Marion County have the right, as they agree among
themselves, to occupy and use the entire area, subject to the terms of this Lease.
3.2 Restrictions on Use. In connection with the use of the Premises, Tenant shall:
(1) Conform to all applicable laws and regulations of any public authority affecting the
premises and the use, and correct at Tenant's own expense any failure of compliance created
through Tenant's fault or by reason of Tenant's use, but Tenant shall not be required to make any
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structural changes to effect such compliance unless such changes are required because of Tenant's
specific use.
(2) Refrain from any activity that would make it impossible to insure the Premises
against casualty or would increase the insurance rate, unless Tenant pays the additional cost of the
msurance.
(3) Refrain from any use that would be reasonably offensive to other tenants or owners
or users of neighboring premises or that would tend to create a nuisance or damage the reputation
of the premises.
(4) Refrain from loading the electrical system or floors beyond the point considered
safe by a competent engineer or architect selected by Landlord.
(5) Refrain from making any marks on or attaching any sign, insignia, antenna, aerial,
or other device to the exterior or interior walls, windows, or roof of the premises without the
written consent of Landlord, which consent shall not be withheld unreasonably.
(6) Tenant shall not cause or permit any Hazardous Substance to be spilled, leaked,
disposed of, or otherwise released on or under the Premises. Tenant may use or otherwise handle
on the Premises only those Hazardous Substances typically used or sold in the prudent and safe
operation of the business specified in Section 3.1. Tenant may store such Hazardous Substances
on the Premises only in quantities necessary to satisfy Tenant's reasonably anticipated needs.
Tenant shall comply with all Environmental Laws and exercise the highest degree of care in the
use, handling, and storage of Hazardous Substances and shall take all practicable measures to
minimize the quantity and toxicity of Hazardous Substances used, handled, or stored on the
Premises. Upon the expiration or termination of this Lease, Tenant shall remove all Hazardous
Substances from the Premises. The term Environmental Law shall mean any federal, state, or
local statute, regulation, or ordinance or any judicial or other governmental order pertaining to
the protection of health, safety or the environment. The term Hazardous Substance shall mean any
hazardous, toxic, infectious or radioactive substance, waste, and material as defined or listed by
any Environmental Law and shall include, without limitation, petroleum oil and its fractions.
3.3 Parking and Access. Landlord guarantees to Tenant for the term of the Lease, and
any extensions of the Lease Term, for the benefit of Tenant and Tenant's employees, agents,
customers and invitees, the right, in common with other tenants of the shopping center and their
employees, agents, customers and invitees, to use the parking. During the term of the Lease and
any extensions of the Lease Term, Landlord shall cause the parking area to be properly operated
and maintained and all entrances, exits, driveways and walkways kept in good repair, such
operation and repair to include, but not be limited to, lighting, traffic control, removal of snow,
ice, rubbish, debris and surfacing and resurfacing with a hard surface.
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Section 4.
Repairs and Maintenance
4.1
Landlord's Obligations. The following shall be the responsibility of Landlord:
(1) Repairs and maintenance ofthe roof and gutters, exterior walls (including painting),
bearing walls, structural members, floor slabs, and foundation, and all wiring and plumbing.
(2) Repair of sidewalks, driveways, curbs and parking areas and areas used in common
by Tenant and Landlord or tenants of other portions of the same building.
(3) Repair and maintenance of exterior water, sewage, gas, and electrical services up
to the point of entry to the leased Premises.
(4) Repair of the heating and air conditioning system other than ordinary maintenance.
(5) Repairs or modifications required to comply with all applicable provisions of the
Americans with Disabilities Act (ADA).
4.2 Tenant's Obligations. The following shall be the responsibility of Tenant:
(1) Repair of interior walls, ceilings, doors, windows, and related hardware, light
fixtures, switches, and plumbing fixtures.
(2) Any repairs necessitated by the negligence of Tenant, its agents, employees, and
invitees, except as provided in Section 6.2 dealing with waiver of subrogation, but including
repairs that would otherwise be the responsibility of Landlord under Section 4.1.
(3) Inspection and ordinary maintenance of the heating and air conditioning system four
(4) times per year.
(4) Any repairs or alterations required under Tenant's obligation to comply with laws
and regulations as set forth in Section 3.2(1), except for changes, or modifications required to
comply with all applicable provisions of the Americans with Disabilities Act (ADA).
(5) All other repairs to the premises which Landlord is not required to make under
Section 4.1.
4.3 Landlord's Interference with Tenant. In performing any repairs, replacements,
alterations, or other work performed on or around the Premises, Landlord shall not cause
unreasonable interference with use of the Premises by Tenant. Tenant shall have no right to an
abatement of rent nor any claim against Landlord for any inconvenience or disturbance resulting
from Landlord's activities performed in conformance with the requirement of this provision.
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4.4 Reimbursement for Repairs Assumed. If either party fails or refuses to make
repairs that are required by this Section 4, the other party may make the repairs and charge the
actual costs of repairs to the first party. Such expenditures by Landlord shall be reimbursed by
Tenant on demand together with interest at the rate of 9 % per annum from the date of expenditure
by Landlord. Such expenditures by Tenant may be deducted from rent and other charges
subsequently becoming due or, at Tenant's election, collected directly from Landlord, together
with interest at the rate of 9% per annum from the date of expenditure. Except in an emergency
creating an immediate risk of personal injury or property damage, neither party may perform
repairs which are the obligation of the other party and charge the other party for the resulting
expense unless the defaulting party is given notice in writing under Section 13.2 outlining with
reasonable particularity the repairs required, and such party fails within the time to initiate such
repairs in good faith.
4.5 Inspection of Premises. Landlord shall have the right to inspect the Premises at
any reasonable time or times to determine the necessity of repair. Whether or not such inspection
is made, the duty of Landlord to make repairs shall not mature until a reasonable time after
Landlord has received from Tenant written notice of the repairs that are required.
Section 5.
Alterations
5.1 Alterations Prohibited. Tenant shall make no improvements or alterations on the
Premises without Landlord's written consent, which consent will not be unreasonably withheld.
All alterations shall be made in a good and workmanlike manner, and in compliance with
applicable laws and building codes. As used herein, "alterations" include the installation of
computer and telecommunications wiring, cables, and conduit.
5.2 Alterations Required. The improvements and alterations delineated on the plans
and specifications attached to and made a part of this lease shall be performed by the party
designated and within the time stated in the plans and specifications or under the terms of this
lease.
5.3 The Landlord shall not be obligated to proceed with any construction unless and
until financing acceptable to Landlord is obtained. Should such financing not be obtainable within
sixty (60) days after completion of final plans and specifications, Landlord may so notify Tenant
in writing, and this Lease shall thereupon cease and terminate and each of the parties hereto shall
be released and discharged from any and all liability and responsibility hereunder. This provision
shall be complied with if Landlord begins the application for financing within the 60-day period
and thereafter proceeds with reasonable diligence and in good faith to obtain the financing. If
Landlord can obtain financing only upon the basis of modifications of the terms and provisions of
this Lease, the Landlord shall have the right to cancel this Lease if the Tenant refuses to approve
in writing any such modification within thirty (30) days after Landlord's request therefor, which
request may not be made after delivery of possession. If such right to cancel is exercised, this
Lease shall thereafter be null and void, any money or security deposited hereunder shall be
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returned to Tenant, and neither party shall have any liability to the other by reason of such
cancellation.
5.4 Ownership and Removal of Alterations. All improvements and alterations
performed on the Premises by either Landlord or Tenant shall be the property of Landlord when
installed unless the applicable Landlord I s consent or plans and specifications specifically provides
otherwise. Improvements and alterations installed by Tenant shall, at Landlord's option, be
removed by Tenant and the premises restored unless the applicable Landlord's consent or plans
and specifications specifically provides otherwise.
5.5 Condition of Premises. As part of the consideration of this Lease, Landlord shall
make all repairs and all alterations set forth in the plans and specifications in a good and
workmanlike manner, before transfer of possession, that are necessary to render the premises
tenable and fit for occupancy, including all necessary repairs to plumbing, water, heating, air
conditioning, lighting and electrical systems.
Section 6.
Insurance
6.1 Insurance Required. Landlord shall keep the Premises insured at Landlord's
expense against fire and other risks covered by a standard fire insurance policy with an
endorsement for extended coverage. Tenant shall bear the expense of any insurance insuring the
property of Tenant on the Premises against such risks.
6.2 Waiver of Subrogation. Neither party shall be liable to the other (or to the other's
successors or assigns) 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, and in the event of insured
loss, neither party's insurance company shall have a subrogated claim against the other. This
waiver shall be valid only if the insurance policy in question expressly permits waiver of
subrogation or if the insurance company agrees in writing that such a waiver will not affect
coverage under the policies. Each party agrees to use best efforts to obtain such an agreement
from its insurer if the policy does not expressly permit a waiver of subrogation.
Section 7.
Taxes; Utilities
7.1 Property Taxes. Tenant shall apply for exemption from ad valorem property taxes
for the Premises under ORS 307.112. Tenant's payments will be adjusted by an amount equal to
the actual savings ofthe annual real property tax payment on the property. Tenant will file a claim
for such exemption in a timely manner as prescribed by ORS 307.112.
7.5 New Charges or Fees. If a new charge or fee relating to the ownership or use of
the Premises or the receipt of rental therefrom or in lieu of property taxes is assessed or imposed,
then, to the extent permitted by law, Tenant shall pay such charge or fee. Tenant, however, shall
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have no obligation to pay any income, profits, or franchise tax levied on the net income derived
by Landlord from this lease.
7.6 Payment of Utilities Charges. Tenant shall pay when due all charges for services
and utilities incurred in connection with the use, occupancy, operation, and maintenance of the
Premises, including (but not limited to) charges for fuel, water, gas, electricity, sewage disposal,
power, refrigeration, air conditioning, telephone, and janitorial services. If any utility services
are provided by or through Landlord, charges to Tenant shall be comparable with prevailing rates
for comparable services. If the charges are not separately metered or stated, Tenant shall pay its
pro rata share of such utilities.
Section 8.
Damage and Destruction
8.1 Partial Damage. If the Premises are partly damaged and Section 8.2 does not
apply, the Premises shall be repaired by Landlord at Landlord's expense. Repairs shall be
accomplished with all reasonable dispatch subject to interruptions and delays from labor disputes
and matters beyond the control of Landlord and shall be performed in accordance with the
provisions of Section 4.3.
8.2 Destruction. If the Premises are destroyed or damaged such that such that the cost
of repair exceeds 40% of the value of the structure before the damage, either party may elect to
terminate the lease as of the date of the damage or destruction by notice given to the other in
writing not more than 45 days following the date of damage. In such event all rights and
obligations of the parties shall cease as of the date of termination, and Tenant shall be entitled to
the reimbursement of any prepaid amounts paid by Tenant and attributable to the anticipated term.
If neither party elects to terminate, Landlord shall proceed to restore the Premises to substantially
the same form as prior to the damage or destruction. Work shall be commenced as soon as
reasonably possible and thereafter shall proceed without interruption except for work stoppages
on account of labor disputes and matters beyond Landlord's reasonable control.
8.3 Rent Abatement. Rent shall be abated during the repair of any damage to the
extent the premises are untenantable, except that there shall be no rent abatement where the
damage occurred as the result of the fault of Tenant.
8.4 Damage Late in Term. If damage or destruction to which Section 8.2 would apply
occurs within one year before the end of the then-current lease term, Tenant may elect to terminate
the lease by written notice to Landlord given within 30 days after the date of the damage. Such
termination shall have the same effect as termination by Landlord under Section 8.2.
Section 9.
Eminent Domain
9.1 Partial Taking. If a portion of the Premises is condemned and Section 9.2 does
not apply, the lease shall continue on the following terms:
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(1) Landlord shall be entitled to all of the proceeds of condemnation, and Tenant shall
have no claim against Landlord as a result of the condemnation.
(2) Landlord shall proceed as soon as reasonably possible to make such repairs and
alterations to the Premises as are necessary to restore the remaining Premises to a condition as
comparable as reasonably practicable to that existing at the time of the condemnation.
(3) After the date on which title vests in the condemning authority or an earlier date
on which alterations or repairs are commenced by Landlord to restore the balance of the Premises
in anticipation of taking, the rent shall be reduced in proportion to the reduction in value of the
Premises as an economic unit on account of the partial taking. If the parties are unable to agree
on the amount of the reduction of rent, the amount shall be determined by arbitration.
(4) If a portion of Landlord's property not included in the Premises is taken, and
severance damages are awarded on account of the Premises, or an award is made for detriment
to the Premises as a result of activity by a public body not involving a physical taking of any
portion of the Premises, this shall be regarded as a partial condemnation to which Sections 9.1 (1)
and 9.1 (3) apply, and the rent shall be reduced to the extent of reduction in rental value of the
Premises as though a portion had been physically taken.
9.2 Total Taking. If a condemning authority takes all of the Premises or a portion
sufficient to render the remaining premises reasonably unsuitable for the use that Tenant was then
making of the premises, the lease shall terminate as of the date the title vests in the ~ondemning
authorities. Such termination shall have the same effect as a termination under Section 8.2.
Landlord shall be entitled to the condemnation proceeds received, and Tenant shall have no claim
against Landlord as a result of the condemnation.
9.3 Sale in Lieu of Condemnation. Sale of all or part of the premises to a purchaser
with the power of eminent domain in the face of a threat or probability of the exercise of the
power shall be treated for the purposes of this Section 9 as a taking by condemnation.
Section 10. Liability and Indemnity
10.1 Liens
(1) Except with respect to activities for which Landlord is responsible, Tenant shall pay
as due all claims for work done on and for services rendered or material furnished to the Premises,
and shall keep the Premises free from any liens. If Tenant fails to pay any such claims or to
discharge any lien, Landlord may do so and collect the cost as additional rent. Any amount so
added shall bear interest at the rate of 9 % per annum from the date expended by Landlord and
shall be payable on demand. Such action by Landlord shall not constitute a waiver of any right
or remedy which Landlord may have on account of Tenant's default.
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(2) Tenant may withhold payment of any claim in connection with a good-faith dispute
over the obligation to pay, as long as Landlord's property interests are not jeopardized. If a lien
is filed as a result of nonpayment, Tenant shall, within 10 days after knowledge of the filing,
secure the discharge of the lien or deposit with Landlord cash or sufficient corporate surety bond
or other surety satisfactory to Landlord in an amount sufficient to discharge the lien plus any costs,
attorney fees, and other charges that could accrue as a result of a foreclosure or sale under the
lien.
10.2 Indemnification. Tenant shall not allow any liens to attach to the building or the
Premises as a result of its activities. Tenant shall indemnify and defend Landlord from any claim,
liability, damage, or loss occurring on the Premises, arising out of any activity by Tenant, its
agents or invitees, or resulting from the Tenant's failure to comply with any term of this Lease.
Landlord shall have no liability to Tenant because of loss or damage caused by the acts or
omissions of the other tenants of the building.
10.3 Liability Insurance. Before going into possession of the Premises, Tenant shall
procure and thereafter during the term of the lease shall continue to carry the following insurance
at Tenant's cost: comprehensive general liability insurance with limits of not less than $1 ,000,000
in connection with anyone occurrence, in a responsible company with coverage for bodily injury
and property damage liability, personal and advertising injury liability, and medical payment.
Such insurance shall cover all risks arising directly or indirectly out of Tenant's activities on the
Premises or on account of the obligations assumed by Tenant under Section 10.2, and shall name
Landlord as an additional insured. Certificates evidencing such insurance and bearing
endorsements requiring 10 days' written notice to Landlord prior to any change or cancellation
shall be furnished to Landlord prior to Tenant's occupancy of the property.
Section 11. Quiet Enjoyment; Mortgage Priority
11.1 Landlord's Warranty. Landlord warrants that it is the owner of the Premises and
has the right to lease them. Landlord will defend Tenant's right to quiet enjoyment of the
Premises from the lawful claims of all persons during the lease term.
11.2 Mortgage Priority. The Premises may become subject to a real estate mortgage
or deed of trust. Tenant agrees to subordinate its interest to that of the mortgagee or beneficiary
upon agreement by the mortgagee or beneficiary that the rights of Tenant under the Lease will be
recognized so that in the event of foreclosure of the mortgage or deed of trust, this Lease will
remain in effect according to its terms and Tenant's possession will not be disturbed as long as
Tenant is in compliance with this Lease.
11.3 Estoppel Certificate. Either party will, within 20 days after notice from the other,
execute and deliver to the other party a certificate stating whether or not this lease has been
modified and is in full force and effect and specifying any modifications or alleged breaches by
the other party. The certificate shall also state the amount of monthly base rent, the dates to which
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rent has been paid in advance, and the amount of any security deposit or prepaid rent. Failure to
deliver the certificate within the specified time shall be conclusive upon the party from whom the
certificate was requested that the lease is in full force and effect and has not been modified except
as represented in the notice requesting the certificate.
Section 12. Assignment and Subletting
No part of the Premises may be assigned, mortgaged, or subleased, nor may a right of use
of any portion of the property be conferred on any third person by any other means, without the
prior written consent of Landlord, which consent shall not be withheld unreasonably. This
provision shall apply to all transfers by operation of law. However, this provision shall not apply
to any transfer by Tenant to Marion County. No consent in one instance shall prevent the
provision from applying to a subsequent instance. In determining whether to consent to
assignment, Landlord may consider the following factors, among others: financial ability of
assignee; business experience of assignee; use of the premises.
Section 13. Default
The following shall be events of default:
13.1 Default in Rent. Failure of Tenant to pay any rent or other charges within 10 days
after written notice that it is due.
13.2 Default in Other Covenants. Failure of Tenant to comply with any term or
condition or fulfill any obligation of the lease (other than the payment of rent or other charges)
within 20 days after written notice by Landlord specifying the nature of the default with reasonable
particularity. If the default is of such a nature that it cannot be completely remedied within the
20-day period, this provision shall be complied with if Tenant begins correction of the default
within the 20-day period and thereafter proceeds with reasonable diligence and in good faith to
effect the remedy as soon as practicable.
13.3 Insolvency. Insolvency of Tenant; an assignment by Tenant for the benefit of
creditors; the filing by Tenant of a voluntary petition in bankruptcy; an adjudication that Tenant
is bankrupt or the appointment of a receiver of the properties of Tenant; the filing of any
involuntary petition of bankruptcy and failure of Tenant to secure a dismissal ofthe petition within
30 days after filing; attachment of or the levying of execution on the leasehold interest and failure
of Tenant to secure discharge of the attachment or release of the levy of execution within 10 days
shall constitute a default. If Tenant consists of two or more individuals or business entities, the
events of default specified in this Section 13.3 shall apply to each individual unless within 10 days
after an event of default occurs, the remaining individuals produce evidence satisfactory to
Landlord that they have unconditionally acquired the interest of the one causing the default. If the
lease has been assigned, the events of default so specified shall apply only with respect to the one
then exercising the rights of Tenant under the lease.
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13.4 Abandonment. Failure of Tenant for seven days or more to occupy the Premises
for one or more of the purposes permitted under this lease, unless such failure is excused under
other provisions of this lease.
Section 14. Remedies on Default
14.1 Termination. In the event of a default the lease may be terminated at the option
of Landlord by written notice to Tenant. Whether or not the lease is terminated by the election
of Landlord or otherwise, Landlord shall be entitled to recover damages from Tenant for the
default, and Landlord may reenter, take possession of the premises, and remove any persons or
property by legal action or by self-help with the use of reasonable force and without liability for
damages and without having accepted a surrender. Tenant shall have the right to terminate this
Lease not less than 90 days after providing the Landlord written notice of its intent to do so in the
event the City's revenues are adversely effected, and the City is required to curtail its business
services, reduce staff and office space. In the event the Lease is terminated by the Tenant under
the previous sentence, Tenant shall pay Landlord the remaining unamortized costs for initial
Tenant improvement costs of $48,206.36. The amount due shall be determined by multiplying
the sum of $803.44 per month by the number of months remaining in the Lease Term.
14.2 Reletting. Following reentry or abandonment, Landlord may relet the Premises
and in that connection may make any suitable alterations or refurbish the Premises, or both, or
change the character or use ofthe Premises, but Landlord shall not be required to relet for any use
or purpose other than that specified in the lease or which Landlord may reasonably consider
injurious to the Premises, or to any tenant that Landlord may reasonably consider objectionable.
Landlord may relet all or part of the Premises, alone or in conjunction with other properties, for
a term longer or shorter than the term of this lease, upon any reasonable terms and conditions,
including the granting of some rent-free occupancy or other rent concession. Landlord shall first
offer to relet the Premises to the Marion County. Marion County shall have thirty (30) days to
accept the offer to relet.
14.3 Damages. In the event of termination or retaking of possession following default,
Landlord shall be entitled to recover immediately, without waiting until the due date of any future
rent or until the date fixed for expiration of the lease term, the following amounts as damages:
(1) The loss of rental from the date of default until a new tenant is, or with the exercise
of reasonable efforts could have been, secured and paying out.
(2) The reasonable costs of reentry and reletting including without limitation the cost
of any cleanup, refurbishing, removal of Tenant's property and fixtures, costs incurred under
Section 14.5, or any other expense occasioned by Tenant's default including but not limited to,
any remodeling or repair costs, attorney fees, court costs, broker commissions, and advertising
costs.
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(3) Any excess of the value of the rent and all of Tenant's other obligations under this
lease over the reasonable expected return from the premises for the period commencing on the
earlier of the date of trial or the date the premises are relet, and continuing through the end of the
term. The present value of future amounts will be computed using a discount rate equal to the
prime loan rate of major Oregon banks in effect on the date of trial.
14.4 Right to Sue More than Once. Landlord may sue periodically to recover damages
during the period corresponding to the remainder of the lease term, and no action for damages
shall bar a later action for damages subsequently accruing.
14.5 Landlord's Right to Cure Defaults. If Tenant fails to perform any obligation
under this lease, Landlord shall have the option to do so after 30 days' written notice to Tenant.
All of Landlord's expenditures to correct the default shall be reimbursed by Tenant on demand
with interest at the rate of 9% annum from the date of expenditure by Landlord. Such action by
Landlord shall not waive any other remedies available to Landlord because of the default.
Landlord shall provide notice to the Marion County which shall have the right to cure Tenant's
default as provided in Section 14.6.
14.6 Tenants Right to Cure Defaults. If Landlord fails to perform any obligation under
this Lease, Tenant shall have the option to do so after 30 days' written notice to Landlord.
Tenant may be collect the amounts due directly from Landlord with interest at the rate of 9% per
annum from the date of expenditure by Tenant. Such action by Tenant shall not waive any other
remedies available to Tenant because of the default.
14.7 Remedies Cumulative. The foregoing remedies shall be in addition to and shall
not exclude any other remedy available to Landlord under applicable law.
Section 15. Surrender at Expiration
15.1 Condition of Premises. Upon expiration of the lease term or earlier termination,
Tenant shall deliver all keys to Landlord and surrender the Premises in first-class condition and
broom clean, depreciation and ordinary wear and tear excepted, but repairs for which Tenant is
responsible shall be completed to the last practical date before surrender. Tenant's obligations
under this section shall be subordinate to the provisions of Section 8 relating to destruction.
15.2 Fixtures
(1) All fixtures placed upon the Premises during the term, other than Tenant's trade
fixtures, shall, at Landlord's option, become the property of Landlord. If Landlord so elects,
Tenant shall remove any or all fixtures that would otherwise remain the property of Landlord, and
shall repair any physical damage resulting from the removal. If Tenant fails to remove such
fixtures, Landlord may do so and charge the cost to Tenant with interest at the legal rate from the
date of expenditure.
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(2) Prior to expiration or other termination of the lease term Tenant shall remove all
furnishings, furniture, and trade fixtures that remain its property. If Tenant fails to do so, this
shall be an abandonment of the property, and Landlord may retain the property and all rights of
Tenant with respect to it shall cease.
15.3 Holdover
(1) If Tenant does not vacate the Premises at the time required, Landlord shall have the
option to treat Tenant as a tenant from month to month, subject to all of the provisions of this lease
except the provisions for term and renewal and at a rental rate equal to 150 percent of the rent last
paid by Tenant during the original term, or to eject Tenant from the Premises and recover damages
caused by wrongful holdover. Failure of Tenant to remove fixtures, furniture, furnishings, or trade
fixtures that Tenant is required to remove under this lease shall constitute a failure to vacate to
which this section shall apply if the property not removed will substantially interfere with
occupancy of the Premises by another tenant or with occupancy by Landlord for any purpose
including preparation for a new tenant.
(2) If a month-to-month tenancy results from a holdover by Tenant under this Section
15.3, the tenancy shall be terminable at the end of any monthly rental period on written notice
from Landlord given not less than 10 days prior to the termination date which shall be specified
in the notice. Tenant waives any notice that would otherwise be provided by law with respect to
a month-to-month tenancy.
Section 16. Miscellaneous
16.1 Nonwaiver . Waiver by either party of strict performance of any provision of this
lease shall not be a waiver of or prejudice the party I s right to require strict performance of the
same provision in the future or of any other provision.
16.2 Attorney Fees. If suit, action or arbitration is instituted in connection with any
controversy arising out of this lease, including any proceedings under the United States
Bankruptcy Code, as amended, the prevailing party shall be entitled to recover in addition to costs
such sum as the arbitrator, judge or court determines reasonable as attorney fees at arbitration or
trial, on petition for review, and on appeal.
16.3 Notices. Any notice required or permitted under this lease shall be given when
actually delivered or 48 hours after deposited in United States mail as certified mail addressed to
the address first given in this lease or to such other address as may be specified from time to time
by either of the parties in writing.
16.4 Succession. Subject to the above-stated limitations on transfer of Tenant's interest,
this lease shall be binding on and inure to the benefit of the parties and their respective successors
and assigns.
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16.5 Recordation. Landlord shall execute and acknowledge a memorandum ofthis lease
in a form suitable for recording, and Tenant may record the memorandum. Tenant shall pay the
recording costs.
16.6 Entry for Inspection. Landlord shall have the right to enter upon the Premises at
any time to determine Tenant's compliance with this lease, to make necessary repairs to the
building or to the Premises, or to show the Premises to any prospective tenant or purchaser, and
in addition shall have the right, at any time during the last two months of the term of this lease,
to place and maintain upon the Premises notices for leasing or selling of the Premises.
16.7 Interest on Rent and Other Charges. Any rent or other payment required of Tenant
by this lease shall, if not paid within 10 days after it is due, bear interest at the rate of 9% per
annum (but not in any event at a rate greater than the maximum rate of interest permitted by law)
from the due date until paid. In addition, if Tenant fails to make any rent or other payment
required by this lease to be paid to Landlord within five days after it is due, Landlord may elect
to impose a late charge of five cents per dollar of the overdue payment to reimburse Landlord for
the costs of collecting the overdue payment. Tenant shall pay the late charge upon demand by
Landlord. Landlord may levy and collect a late charge in addition to all other remedies available
for Tenant's default, and collection of a late charge shall not waive the breach caused by the late
payment.
16.8 Proration of Rent and other Charges. In the event of commencement or
termination of this lease at a time other than the beginning or end of one of the specified rental
periods, then the rent and other charges shall be prorated as of the date of commencement or
termination and in the event of termination for reasons other than default, all prepaid rent and
other charges shall be refunded to Tenant or paid on its account. Tenant shall have the right to
reasonably review supporting data for Landlord I s proration of rent, utilities, insurance, taxes and
assessments.
16.9 Time of Essence. Time is of the essence of the performance of each of Tenant's
obligations under this lease.
Section 17. Mediation and Arbitration
17.1 Mediation. In the event of a dispute between the parties arising out of or relating
to this Lease, the parties agree to submit such dispute to a mediator agreed to by the parties as
soon as practicable after the dispute arises, and preferably before commencement of litigation or
arbitration. The parties agree to exercise their best efforts in good faith resolve all disputes in
mediation.
17.2 Disputes to Be Arbitrated. If any dispute arises between the parties with respect
to any matter or thing arising out of, or in any way relating to this lease, except with respect to
actions to renter or take possession of the premises, or other statutory or equitable actions, not as
Page 14 - Commercial Lease
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an exclusive remedy, and only upon the mutual agreement of Landlord and Tenant to do so, such
dispute or difference may be referred to arbitration. The parties shall mutually select an
arbitrator. If the parties can not agree on an arbitrator, then each party shall select one competent
person, and those two individuals will then select a third neutral person to act as arbitrator. The
arbitrator should have experience in commercial real estate.
17.3 Procedure for Arbitration. The arbitration shall proceed according to the Oregon
statutes governing arbitration, and the award of the arbitrator shall have the effect therein
provided. The arbitration shall take place in the county where the leased premises are located.
Costs of the arbitration shall be shared equally by the parties, but each party shall pay its own
attorney fees incurred in connection with the arbitration.
Landlord:
Ira Gordon
Daniel M. Oredson
Val A. Yanagihara
Clifford B. Dart, Trustee under the Clifford
B. Dart Declaration of Trust Dated July 6,
1989
Tenant:
City of Woodburn
By:eO~ ~
Tit Ma 0 r ,
W:\ WORK\JAN\KEY\MALL99\LEASECIT. WPD
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