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HomeMy WebLinkAbout1992-141 Lease - Oak KnollSTATE OF OREGON ) County of Jackson) I, Brian Almquist, being ~ ~, A~-,~,, ltD'URN TO: % ', ti,' ~ ~ . first duly sworn, say that: 1. I am the city administrator for the city of Ashland, Oregon. 2. The current lessee for the Oak Knoll Golf Course in the City of Ashland, a description of which is contained in the document attached as Exhibit A, is Oak Knoll Enterprises, Inc. by virtue of a lease executed on November 27, 1974 between the City of Ashland and Oak Knoll Enterprises, Inc., a true copy of which is attached as Exhibit A. 3. Prior to Oak Knoll Enterprises, Inc. being the lessee, Oak Knoll Corporation was the lessee. The lease between the City of Ashland and Oak Knoll Corporation was surrendered on January 1, 1975, by means of a "Surrender of Lease," a true copy of which is attached to this affidavit as Exhibit B. 4. The City of Ashland and Oak Knoll Enterprises, Inc. have released their interest in that portion of the golf course described in "Release of Lease on Real Property" the original of which is attached as Exhibit C. 5. The City of Ashland, by and through its city Administrator, makes this affidavit for the purposes of removing any encumbrance from the title of that lot being insured through American Pacific Title & Escrow Company, 346 E. Main Street, Ashland, Oregon 97520, escrow number 706443-CT, resulting from the city of Ashland leasing the golf course described above to those lessees or assignees listed in exception 6 of the preliminary title report dated December 16, 1992. In that respect, the city of Ashland agrees to indemnify American Pacific Title and Escrow Company from any loss it may suffer from insuring the title free of any encumbrance resulting from the leases or assignments listed as exceptions in paragraph 6 of this preliminary title report. STATE OF OREGON County of Jackson s This instrument was acknowledged before me,.on /~-/i~ :?~ by Brian Almquist as City Administrator for. the city of A~hiand, Oregon. Noth~y ~gblic for Oregon ,, My commission expires: ,-/-:, / / Attachments: A. lease executed on November 27, Ashland and Oak Knoll Enterprises, attached as Exhibit A. 1974 between the City of Inc., a true copy of which is B. "Surrender of Lease," a true copy of which is attached to this affidavit as Exhibit B. C. "Release of Lease on Real Property" the original of which is attached as Exhibit C. LEASE Oregon, THIS AGtqEEMENT OF LEASE made and entered into at Ashland, this ~day of ~,nt~ , by and b~tween the CITY OF ASHLAND, a Municipal corporation, hereinafter designated as "Les.sor", and OAK KNOLL ENTERPRISE, iNC. corporation of the State of Oregon, hereinafter designated as "Lessee", WITNESSETH: The parties hereto agree as follows: The Lessor, for and in consideration of the covenants and payments hereinafter mentioned to be performed and made by the Lessee, does hereby LEASE and LET unto the Lessee for the term and subject to the conditions hereinafter set forth upon the following premises in Jackson County, Oregon, to-wit: Eighty-three (83) acres, more or less, located in D.L.C. ~53, Township 39 South, Range 1 East, W. M., as more particularly described in Vol. 227, page 478, Deed Records of said Jackson County, Oregon, except that portion of the above described property lying southerly of a line 100 feet South and running parallel to the Number 1 fairway of the golf course as it now exists. Also an access roadway along the southerly boundary of said golf course. II The term of this Lease shall be, and is, for a per~ed of twenty (20) years from the 1st da%~o_f January , ]975, to and including the 3]stday of , ~11~,~ III Thc Lessee promises and agrees to pay to l~essor as rental -1- Lease for said premises an amount equal to One Percent (1%) of the total 9ross income of the corporation up to FOUR-HUNDRED THOUSAND DOLLARS ($400,000.00) and to pay to the Lessor an amount equal to Two Percent (2%) of all annual gross income exceeding FOUR-~UNDRED THOUSAND DOLLARS ($400,000.00). Such pa]~ents to be made on a yearly basis and to be due to the Lessor no later than Sixty (60) Days after the date the Corporation's Federal Annual Income Tax Report is due. oessee agrees to furnish to the Lessor a certified copy of Its Federal An~lual Income Tax the date that such report Lessee as computed on Its Report no later than Sixty (60) Days after is due. The total gross income of the Federal Income Tax Return shall be used as the total gross income in determining the rental herein. IV The Lessee agrees that within the first two (2) years of this lease-period It will spend, in cash, or by means of credit, and not by donated labor or material, not less than FORTY-THOUSAND DOLLARS ($40,000.00) on capital improvements as set forth specifically in this article, ghe Lessee further agrees that It will furnish to the Lessor, no later than the end of the first two-year period written proof that It has spent such sum of FORTY-THOUSEqD DOLLARS ($40,000.00). If the Lessee fails for any reason to spend the full sum of $40,000.00 as herein stated and furnish such proof as above recuired to the Lessor within the two-year period, then this Lease will automatically tez~inate. The $40,000.00 shall be spent on one (1) or more of the following capital improvements as selected by the Lessee, said improve- ments to be to the golf course a:~d they are hereby gpprovod by thc Lessor: -2- Lease 1. Irrigation system. 2. improve sandtraps and lakes. 3. Construet ©quipment shed. 4. Add additional tees and improve ladies' tees. 5. Pave cart paths. 6. Ccnshruct new tee boxes on the leased property for a driving range whicl! need not be on the ]eased property. 7. Improve restrooms in V Lessor agrees to forgive clubhouse and on golf course. and not to require payment to It of the annual ren[al for the first two (2) years. During the next eight (8) years of the Lease the rent due to the Lessor shall be spent by the Lessee on capital improvements to any part of the leased premises as selected by the Lessee. This money must be spent within eighteen (18) months of the date that ~he rent is due to the Lessor wi~h written proof being given within that eighteen-month period Eo the Lessor of the fact of the improvemen~ being made and also, describing the nature of the improvement. During the last ten (10) years of the Lease, the rent shall be paid to the Lessor when due and the Lessor shall then use ~he money for capital improvements to the golf course, the clubhouse or any other capital improvement to the premises as It deems to be appropriate. The Lessor may retain any annual rental payment so as to accumulate a sufficient sum to make capital improvements as It deems appropriate. Ail capital improvements made to the leased premises shall be improvements to the rea]. property and shall become the Lessors' at the termination of the Lease. -3- Lease The rent to be'used by the Lessee pursuant to the second period consisting of eight (8) years shall be set aside by it in a separate account from the date that it is due until it is spent. Further, the Lessee agrees to maintain separate accounting procedures for the golf course on the one hand, of the .corporation on the other. If the Lessee spends more and for all other functions than is required by the terms of this Lease on capital improvements during any one (1) year, it shall not have a credit for the excess payment toward the rent due in the following years. VI The Lessee covenants and agrees that the Corporation, which is the Lessee herein, shall engage in no other business than the business of operating the Oak Knoll Golf Course, Clubhouse, Restaurant~ Cocktail Lounge, and related facilities, as herein defined, or ~s may hereinafter be permitted by the Lessor. VII Lessee covenants and agrees to use the land and buildings only as a public golf course, clubhouse, and related uses, or such uses as may be approved by the Lessor. VIII The Lessee agrees and covenants that all facilities herein being leased to It, or which it may hereafter construct, shall be open to all members of the public. Lessor is -4- Lease IX It is agreed and understood that the prime interest of the in havinq adequate go]fJnc] l~ci]ities for th< use of the general public, and it or indiiect action, to by the general public. X Lessee agrees and covenants that it will make annual memberships not limited in number to individuals is agreed that the Lessee shall take in any way discourage the use of the no direct, premises available to play on said Golf Course and utilize the facilities thereof; and, that said annual membership fees and all daily rates and charges for the use in any way of any portion of the golfing facilities must be in such amount as to permit the Lessee to make a reasonable profit after taking into consideration the profit derived by Lessee for the operation of all other aspects of Its business and be approved by the Lessor. In the event there is a dispute as to the reasonable charge for any of the above mentioned uses cf uhe Golf Course, the matter shall be submitted to a board of arbitrators, one to be selected by each party, and a third by the first two arbitrators, of said Board shall be considered final. The current rates being cn~g~a for use of the golf course facilities are hereby jointly approved, and they are as follows: Green Fees - Week Days 9 holes ....... $ 2.25 18 holes ....... $ 4.00 Green Fees - Weekends and Holidavs 9 holes ....... $ 3.00 18 holes ....... $ 5.00 Green Fees Annual Mer~bership Family (children under years) unl ~m_~o ...... $240.00 Individual - uniin~ted ...... $205.00 Individual - weekdays helidays) . - ......... $175.00 -5- Lease and the decision Golf Cart Rental Electric - 9 ho]es ..... $ 4.50 18 holes $ 8.00 Pull-type - 9 or 18 holes $ .75 It is further agreed that no charge will be made to members of the public for the use of private golf carts until the Lessee provides an adequate storage shed for such golf carts. At that time, it is agreed that the Lessee may charge the following rates for the use of private golf carts on the golf course: $100.00 per year if golf carts are stored on the premises. $ 50.00 per cart is Lessor covenants year or $1.00 per not stored on the XI and agrees day if the golf premises. to furnish water for drinking purposes at the usual metered rates, and further agrees to make avail- able to Lessee the share of Lessor in the output from the nearby sulfur springs without cost or charge. Lessor further agrees to make available to Lessee irrigation water from the Talent Irrigation District ditch, as may be required by Lessee in excess of the sulfur springs' water, and said water from the Talent Irrigation District shall be furnished at prevailing irrigation XII Lessee covenants and and proper state and condition and all improvements thereon in a of repair, all at Its own expense, surrendered at the termination of -6- Lease rates. agrees to keep said premises in a good for use as a golf course and golf club, good and proper state and condition so that the premises will be the Lease to the Lessor in a better condition than thcy are at present and in a good and proper condition for use as a golf course ,n~d golf club. To do this, the Lessee agrees, at a minimum, to do the following ]toms of maintenance: 1. .Fa]rways to bc pl~[gged and fertilized twice a year. 2. Greens aerif.ied three (3) times a year - Spring, Summer and Fall. 3. Greens to be fertilized and top-dressed at the same time as beir~g aerified. 4. Greens to be cut three (3) times a week - more often for tournaments. 5. Course to be watered six (6) times each week, except during the times when it is otherwise being watered by the natural rainfall. 6. Fairways to be cut twice a week. 7. Cups to be changed twice a week on Tuesday or Wednesday and on Friday or Saturday. 8. Rough to be cut throughout the summer so as to keep the course in a good and playable condition. 9. Traps to be raked on the same days as the greens are cut. 10. Greens to be verticut once during the Spring of each year. Items 4, 5, 6 and 7 above, are to be done from May 1 through September 30th of each year. XIII Lessee covenants ~nd agrees to [}ay all real and personal property taxes assessed aga~n~:t the above-describ~d property -7- Lease ~he term of this Lease; November 15th of the year in which the XIV The.Lessee shall at Its sole comprehensive general public liability and the Lessor with limits of at least such payments to be made no later than taxes become due and payable. cost and expense, maintain insurance in favor of Itself ONE-HUNDRED THOUSAND DOLLARS/ THREE-HUNDRED THOUSAND DOLLARS ($100,000.00/$300,000.00) for bodily injury and FIFTY THOUSAND DOLLARS ($50,000.00) for property damage. Such policies shall name the Lessor and Lessee as the maned insureds. Further, such policies shall contain a clause that they may not be cancelled by the insurance company without first giving the Lessor thirty (30) days written notice of such intended cancellation. XV Lessee agrees to insure for fire with extended coverage all improvements now on, or which may be hereafter constructed on the said premises, said insurance to be to the full replacement cost of the improvements. insureds so that any by way of checks payable jointly to the Lessor and the Lessee. and Lessee jointly agree to forthwith reconstruct or repair any Both the Lessee and the Lessor shall be named proceeds payable from such insurance shall be i~essor property so damaged or destroyed so as condition it was in before the fire. Lessee agrees that it will to be in substantially the not construct any new buildings, nor make any substantial changes to any of the existing buildings or to any building hereafter constructed without first having obtained written consent of the I,essor which shall not be unreasonably withheld. -8- Loase XVI Upon termination of this Lease, all capital improvements, all buildings including fixtures arid items attached to such buildings or built into such buildings, sprinkler systems and other physical and capital improvements to the premises shall be the sole property of the Lessor. XVII On failure of the Lessee to comply with any of the conditions of this Lease within thirty (30) days after written notice is given thereof, time being of the essence, the Lessor, at Its option, may terminate the same without notice and may re-enter and take possession of the premises and expell the occupant thereof without in any way being a trespasser; the failure to take possession at the time as stated aforesaid shall not, however, estop the Lessor from afterward asserting Its rights. Such remedy, however, shall be cumulative and not exclusive and Lessor shall have the right to any other remedy at law or equity. XVIII The Lessee covenants and agrees not to sublease, transfer or assign this Lease, or any portion of the leased premises, without first having and obtaining the written consent of the Lessor. it is further agreed and understood that the stockholders of the Lessee reasons, shall not sell or assign any interest in said stock without first having and obtaining the written consent of the Lessor herein. Such consent, however, shall not be withheld by the Lessor for any captious but shall be given iii the event any proposed new stockholder -9- Lease or neW Lessee is in the reasonable judgment of the Lessor a person who has sufficient financial resources and is of such training and experience as to guarantee to the Lessor that the premises will be operated in a manner that will make available to the public a good and proper golf course and club house and related facilities. XIX Lessee further agrees that It will never suffer or permit any mechanics', ~aterialmens', or other lien of any kind or nature to be enforced against said premises. Further, to the extent that It is able, It will never permit any lien of any nature whatsoever to be created against the property and as for liens upon this Lease, It will not permit such liens to be created or exist to the extent that It is able without first having obtained the consent of the Lessor which shall not be unreasonably withheld. XX The Lessee agrees that if the Lessor chooses to annex the subject land to the City of Ashland and to withdraw the subject land from the Talent Rural Fire Protection District, then the Lessee will pay to the Lessor an amount equal to the then current annual assess- ment against the subject land for the bonds outstanding of the Talent Rural Fire Protection District multiplied by the number of years remaining on such bonds. XXI This Lease shall become effective when the Oregon Liquor Control Cormmission has approved a liquor lJcense for Lessee at this location and the Lessee has acquired and delivered to the I,cssor the surrender of the existing Lc~se between the pros~nt Lessor and the ~%~' -!0-Lease ,resent Lessee, which is thc Oak Knoll Golf Club, Inc. If boti] of these conditions are not accomplished by February 1, ]975, then this Lease shall be of no force and effect whatsoever, and all rights herein shall end and terminate %;ithout further action by either party. XXII This Lease is, and shall be, binding upon and inure to the benefit of the parties hereto, their successors and assigns. IN WITNESS ~{EREOF, the parties hereto have hereunto set their hands and seals in duplicate on the date first above written. CITY © SHLAN, D MAYOR "LESSOR" ATTEST: ' CITY RECORDER OAK KNOLL ENTERPRISE, INC. ~t~SIDE~ By ~,, SECRETARY "LESSEE" -] ] -Lease EXHIB}T B ~2--3~j SURRENDER OF LEASE THIS AG_~EEMENT made this / day of ,/ V/~ ~ ,~, ~, ,/ , 197.4% between the CITY OF AoHL~ND, a municipal corporation of the State of ~\. Oregon, hereinafter referred to as "Lessor", and the OAK KNOLl, CORPORATION, hereinafter referred to as "Lessee"; ~KLE~EAS, the Oak Knoll Corporation is the assignee the Lessee's rights irt a Lease doted May 1, 1962 between the Ashland and the Oak Knoll Golf Club, of City of Inc., which Lease was. ~o_ premises located in Jackson County, Oregon, follows: Eighty-three (83) acres, in D.L.C. ~53, Township and more particularly described as more or less, located 39 South, Range 1 East, W.M., as more particularly described in Vol. 227, page 478, Deed Records of said Jackson County, Oregon, except that portion of the above described property lying southerly of a line 100 feet Sou~h and running parallel to the Number 1 fairway of the golf course as it now exists. Also an access roadway along the southerly boundary of said golf course. WHEREAS, the Lessee has negotiated a sale of Its interest in the premises and the Lease and the Purchaser and the Lessor desire to enter into a new and different Lease. NOW, THEREFORE, it is mutually agreed that the above- referenced Lease is hereby completely terminated and the Lessee does hereby surrender Its interest in said Lease and does surrender the possession of the property to the Lessor. IN WITNESS WHEREOF, the parties have hereunto set their hands and seals on the day first written above. CITY OF ASHLAND ' P~IqE ~ I Di':N T // 'CITY t~ECORDER SECreTARY ~ "LESSOR" OAK KNOLL CORPO!LATION "LESSEE" EXHIBIT C RELEASE OF LEASE ON REAL PROPERTY The undersigned, for valuable consideratior~, re~ceip,t of.which is aqknowledged, does release the property in Jackson Countthya, ro~n~fS, wU~c-t~'~i~ c~s~6e~l~lethe attached Exhibit A, from all claim or interest in the same or any part thereof which the undersigned may have under and by virtue of a lease dated May 1, 1962, recorded December 16, 1964 in volume 579, page 67, Jackson County Deed Records, where the City of Ashland is lessor and Oak Knoll Golf Club, Inc. is lessee. Lessee's interest has been assigned and is now held by Oak Knoll Enterprises Incorporated. DATED this ' ? '-' day of December, 1992. Lessor: City of Ashland Brian Almquist, City Adm~ator STATE OF OREGON County of Jackson Lessee: Oak Knoll Enterprises Inc. This instrument was acknowledged before me on Z¢-..~,... /'7 , 1992, by Brian AImquist as City Administrator of the City of Ashland, Oregon. NOtary Public for Oreg6tn My Commission expires: State of Oregon County of Jackson This instrument was acknowledged before me o,n/'2.¢¢¢.. , /~' , 1992, (~./j~<~'~-.~.~,~.__ as of Oak Knoll Corporation. FY ' Notary Public for Ore~on My Commission expires: EXHIBIT A ¢ommencin~ a% thc Northwest corne~ ~ Donation 5and Claim No. 56 in ~oWnsh~p 3~ Sou%b, R~ge 1 ~aI~ Of ~b~ W~l~amet%~ sou~h 71" 00~ $1" Sa~ 90.73 f~t; 'thence South ~$~ 22' 02" Zast j~c~$on _~unty, Oregon O.-'F~C!AL R~CORD$ DEC 2 1 1992 ~ KATHLEEN S. BECKEIt