HomeMy WebLinkAbout1994-099 Lease - WongNovember 30, 1994
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City Recorder Nan Franklin
Administrative Secretary Caralyn Dusenberry
Sam Wong - Commercial Lease - 27 1/2 North Main Street
Please file the attached original Commercial Lease signed by Sam Wong and the City of Ashland for the offices
located at 27 1/2 North Main Street.
THANK
COMMERCIAL LEASE
Date: October 14, 1994
Between:
Sam Wong ("Landlord")
1147 Park Street
Ashland, Oregon 97520
And:
City of Ashland ("Tenant")
20 East Main Street
Ashland, Oregon 97520
Landlord leases to Tenant and Tenant leases from Landlord the following described property (the
"premises") on the terms and conditions stated below:
Offices 3 through 6, 8 and 9
Suites A & B
27 1/2 North Main Street
Ashland, Oregon
Landlord retains right to use the small janitorial closet for his storage. Tenant and all those having
business with Tenant in common with the other tenants and others having business with them, shall
have the right to use and enjoy the halls, stairway, open means of ingress and egress, and other similar
areas for their intended purposes subject to the terms of this agreement.
1. Occupancy.
1.1. Original Term. The term of this lease shall commence September 1, 1994, and continue
through August 31, 1996, unless sooner terminated as provided below.
1.2. Possession. Tenant's right to possession and obligations under the lease shall commence
on September 1, 1994.
1.3. Renewal Option, If the lease is not in default at the time each option is exercised or at the
time the renewal term is to commence, Tenant shall have the option to renew this lease for five
successive terms of one year each, as follows:
1.3.1. Each of the renewal terms shall commence on the day following expiration of the
preceding term.
1.3.2. The option may be exercised by written notice to Landlord given not less than 60
days prior to the last day of the expiring term. The giving of such notice shall be sufficient to make the
lease binding for the renewal term without further act of the parties. Landlord and Tenant shall then be
bound to take the steps required in connection with the determination of rent as specified below.
1.3.3. The terms and conditions of the lease for each renewal term shall be identical
with the original term except for rent and except that Tenant will no longer have any option to renew this
lease that has been exercised. Rent for a renewal term shall be the greater of (a) the rental during the
preceding original or renewal term or (b) a reasonable rental for the ensuing term.
1.3.4. If the parties do not agree on the rent within 30 days after notice of election to
renew, the rent shall be determined by a qualified, independent real property appraiser familiar with
commercial rental values in the area. The appraiser shall be chosen by Tenant from a list of not fewer
than five such individuals submitted by Landlord. If Tenant does not make the choice within five days
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after submission of the list, Landlord may do so. If Landlord does not submit such a list within 10 days
after written request from Tenant to do so, Tenant may name as an appraiser any individual with such
qualifications. Within 30 days after appointment, the appraiser shall return a decision, which shall be
final and binding upon both parties. The cost of the appraisal shall be borne equally by both parties.
2. Rent. During the original term, Tenant shall pay to Landlord as rent the sum of $1,075.00 per month.
Rent shall be payable on the first day of each month in advance at such place as may be designated by
Landlord.
3. Use of the Premises. The premises shall be used for city offices and for no other purpose without
the consent of Landlord, which consent shall not be withheld unreasonably.
4. Repairs and Maintenance.
4.1. Landlord's Obligations. The following shall be the responsibility of Landlord:
4.1.1. Repairs and maintenance of the roof and gutters, exterior walls (including
painting), bearing walls, structural members, floor slabs, and foundation.
4.1.2. Repair and maintenance of exterior water, sewage, gas, and electrical services up
to the point of entry to the premises.
4.1.3. Repair of the heating system other than ordinary maintenance.
4.2. Tenant's Obligations. The following shall be the responsibility o1 Tenant:
4.2.1. Repair of interior walls, ceilings, doors, windows, and related hardware, light
fixtures, switches, and wiring and plumbing from the point of entry to the premises.
4.2.2. 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.
4.2.3. Ordinary maintenance of the heating and air conditioning system and any repairs
necessary because of improper maintenance.
4.2.4. 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.
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 payments subsequently becoming due or,
at Tenant's election, collected directly from Landlord. 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 at least 10 days before work
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is commenced, and the defaulting party is given notice in writing outlining with reasonable particularity
the repairs required, and such party fails within that 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.
5. Alterations.
5.1. Alterations Prohibited. Except for repainting, carpet installation, light installation and
rewiring, Tenant shall make no improvements or alterations on the premises of any kind without first
obtaining Landlord's written consent. AIl alterations shall be made in a good and workmanlike manner,
and in compliance with applicable laws and building codes. As used herein, "alterations" includes the
installation of computer and telecommunications wiring, cables, and conduit.
5.2. 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's consent 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 specifically provides otherwise.
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 but shall not be required to insure.
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.
7. Taxes; Utilities.
7.1. Property Taxes. Tenant shall pay as due all taxes on its personal property of located on
the premises. Landlord shall pay as due all real property taxes and special assessments levied against
the premises.
7.2. Special Assessments. If an assessment for a public improvement is made against the
premises, Landlord may elect to cause such assessment to be paid in installments, in which case all of
the installments payable with respect to the lease term shall be treated the same as general real property
taxes for purposes of section 7.1.
7.3. 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, including janitorial services for the
hallway. If any utility services are provided by or through Landlord, charges to Tenant shall be
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comparable with prevailing rates for comparable services. If the charges are not separately metered or
stated, Landlord shall apportion the charges on an equitable basis, and Tenant shall pay its apportioned
share on demand.
8. Damage and Destruction.
8.1. Partial Damage. if the premises are partly damaged and section 8, 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 the cost of repair
exceeds 50% 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, 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.
9. Liability and Indemnity.
9,1. Liens.
9.1.1. 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.
9.1.2. 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. Quiet Enjoyment.
10.1. 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.
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10.2. 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 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.
11. 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 pr[or written consent of Landlord. This provision shall apply to all transfers by
operation of law. No consent in one instance shall prevent the provision from applying to a subsequent
instance. Landlord shall consent to a transaction covered by this provision when withholding such
consent would be unreasonable in the circumstances.
12. Default. The following shall be events of default:
12.1. Default in Rent. Failure of Tenant to pay any rent or other charge within 10 days after
written notice that it is due.
12.2. 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.
12.3. 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 of the 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
12.3 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.
12.4. Abandonment. Failure of Tenant for 60 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.
13, Remedies on Default.
13.1. 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.
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13.2. Reletting. FoJlowing 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 of the 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.
13.3. 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:
13.3.1. 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.
13.3.2. 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
13.5, 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.
13.3.3. 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.
13.4. 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.
13.5. 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% per 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.
13.6. Remedies Cumulative. The foregoing remedies shall be in addition to and shall not
exclude any other remedy available to Landlord under applicable law.
14. Surrender at Expiration.
14.1. Condition of premises. Upon expiration of the lease term or earlier termination on
account of default, Tenant shall deliver all keys to Landlord and surrender the premises in first-class
condition and broom clean. Alterations constructed by Tenant with permission from Landlord shall not
be removed or restored to the original condition unless the terms of permission for the alteration so
require. Depreciation and wear from ordinary use for the purpose for which Tenant is responsible shall
be completed to the latest practical date prior to such surrender. Tenant's obligations under this section
shall be subordinate to the provisions of section 8, 8.2 relating to destruction.
14.2. Fixtures.
14.2.1. 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
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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.
14.2.2. 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 or, by notice in writing given to Tenant within 20 days after removal was required,
Landlord may elect to hold Tenant to its obligation of removal. If Landlord elects to require Tenant to
remove, Landlord may effect a removal and place the property in public storage for Tenant's account.
Tenant shall be liable to Landlord for the cost of removal, transportation to storage, and storage, with
interest at the legal rate on all such expenses from the date of expenditure by Landlord.
14.3. Holdover.
14.3.1. 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.
14.3.2. If a month-to-month tenancy results from a holdover by Tenant under this
section 14.3, 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.
15. Miscellaneous.
15.1. Nonwaiver. Waiver by either party of strict performance of any provision of this lease
shall not be a waiver of or prejudice the party's right to require strict performance of the same provision
in the future or of any other provision.
15.2. Attorney Fees. If suit or action is instituted in connection with any controversy arising
out of this lease, the prevailing party shall be entitled to recover in addition to costs such sum as the
court may adjudge reasonable as attorney fees at trial, on petition for review, and on appeal.
15.3. 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.
15.4. 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.
15.5. 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.
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15.6. 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.
15.7. Proration of Rent. 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 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 shall be refunded to Tenant or paid on its account.
15.8. Time of Essence. Time is of the essence of the performance of each of Tenant's
obligations under this lease.
Tenant:
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