EXHIBIT 10R
LEASE
DATED: November 16, 1994
BETWEEN: REAL ESTATE PROPERTIES LIMITED PARTNERSHIP,
an Oregon limited partnership LANDLORD
AND: FRED MEYER, INC.,
a Delaware corporation TENANT
Tenant wishes to lease from Landlord the following
described property, hereinafter referred to as "the Premises":
Approximately 3,490 square feet of warehouse space
located in North Basin-Swan Island Warehouse, 3205 N. Webster,
Portland, Oregon 97217 and as further described on the attached
Exhibit A.
If the Premises consist of a portion but not all of a
building, the building housing the Premises is hereinafter
referred to as "the Building."
Landlord leases the Premises to Tenant for a term of 60
months commencing December 1, 1994 and continuing through
November 31, 1999 at a base rent of Two Thousand and No/100
Dollars ($2,000.00) per month.
Rent for the first month of the lease term has been paid upon
execution of this lease. All rent, including base rent together
with the charges, taxes and expenses to be paid to Landlord
specified in paragraphs 3 and 4 of this lease, is payable in
advance on the first day of each calendar month. If Landlord
consents, Tenant may occupy the Premises prior to such
commencement date upon payment of rent on a prorated basis and
compliance with all terms of this lease.
Delivery of possession shall occur when the Premises
are occupied by Tenant or are ready to be occupied by Tenant with
all work to be performed by Landlord substantially completed. No
notice shall be required from Landlord if the Premises are ready
on the date set for commencement of the term or on the first
business day thereafter. If Landlord is unable to deliver
possession of the Premises to Tenant because of strikes, acts of
God, or any other cause beyond Landlord's control, then Tenant
may take possession when Landlord notifies Tenant that the
Premises are ready for possession, and the term of this lease
shall commence on the first day of the first month following such
date and continue for the specified number of months thereafter,
notwithstanding the commencement and termination dates stated
above. Tenant shall owe no rent until the Premises are ready for
possession. Landlord shall have no liability for such delays in
delivery of possession, and neither party shall have the right to
terminate except that Landlord may cancel this lease without
liability if permission to construct, use, or furnish necessary
utilities to the Premises is denied or revoked by any
governmental agency or public utility with such authority.
This lease is subject to the following additional terms
to which the parties agree:
1. Use of the Premises.
(a) Tenant shall use the Premises only for the purpose
of conducting the following business:
Truck maintenance and parking for trucks.
If such use is prevented by any law or governmental regulation,
Tenant may use the Premises for other reasonable uses.
(b) In connection with its use, Tenant shall at its
expense comply with all applicable laws, ordinances, and
regulations of any public authority, including those requiring
alteration of the Premises because of Tenant's specific use;
shall create no nuisance nor allow any objectionable liquid,
odor, or noise to be emitted from the Premises; shall store no
gasoline or other highly combustible materials on the Premises
which would violate any applicable fire code or regulation nor
conduct any operation that will increase Landlord's fire
insurance rates for the Premises; and shall not overload the
floors or electrical circuits of the Premises. Landlord shall
have the right to approve the installation of any power-driven
machinery by Tenant and may select a qualified electrician whose
opinion will control regarding electrical circuits and a
qualified engineer or architect whose opinion will control
regarding floor loads. Allowable ground floor load shall be 300
pounds per square foot.
(c) Tenant may erect a sign stating its name,
business, and product after first securing Landlord's written
approval of the size, color, design, wording, and location, and
all necessary governmental approvals. No signs shall be painted
on the Building or exceed the height of the Building. All signs
installed by Tenant shall be removed upon termination of this
lease with the sign location restored to its former state.
(d) Tenant shall make no alterations, additions, or
improvements to the Premises or change the color of the exterior
without Landlord's prior written consent and without a valid
building permit issued by the appropriate governmental agency.
Upon termination of this lease, any such alterations, additions,
or improvements (including without limitation all electrical,
lighting, plumbing, heating and air-conditioning equipment,
doors, windows, partitions, drapery, carpeting, shelving,
counters, and physically attached fixtures) shall at once become
part of the realty and belong to Landlord unless the terms of the
applicable consent provide otherwise, or Landlord requests that
part or all of the additions, alterations, or improvements be
removed. In such case, Tenant shall at its sole cost and expense
promptly remove the specified additions, alterations, or
improvements and repair and restore the Premises to its original
condition.
2. Security Deposit.
Tenant has deposited with Landlord the sum of
$2,000.00, hereinafter referred to as "the Security Deposit," to
secure the faithful performance by Tenant of each term, covenant,
and condition of this lease. If Tenant shall at any time fail to
make any payment or fail to keep or perform any term, covenant,
and condition on its part to be made or performed or kept under
this lease, Landlord may, but shall not be obligated to and
without waiving or releasing Tenant from any obligation under
this lease, use, apply or retain the whole or any part of the
Security Deposit (i) to the extent of any sum due to Landlord; or
(ii) to make any required payment on Tenant's behalf; or (iii) to
compensate Landlord for any loss, damage, attorneys' fees, or
expense sustained by Landlord due to Tenant's default. In such
event, Tenant shall, within 5 days of written demand by Landlord,
remit to Landlord sufficient funds to restore the Security
Deposit to its original sum; Tenant's failure to do so shall be a
material breach of this lease. Landlord shall not be required to
keep the Security Deposit separate from its general funds, and
Tenant shall not be entitled to interest on such deposit. Should
Tenant comply with all of the terms, covenants, and conditions of
this lease and at the end of the term of this lease leave the
Premises in the condition required by this lease, then the
Security Deposit, less any sums owing to Landlord, shall be
returned to Tenant (or, at Landlord's option, to the last
assignee of Tenant's interests hereunder) within 30 days after
the termination of this lease and vacancy of the Premises by
Tenant.
3. Utility Charges; Maintenance.
(a) Tenant shall pay when due all charges for
electricity, natural gas, water, garbage collection, janitorial
service, sewer, and all other utilities of any kind furnished to
the Premises during the lease term. If charges are not
separately metered or stated, Landlord shall apportion the
utility charges on an equitable basis. Landlord shall have no
liability resulting from any interruption of utility services
caused by fire or other casualty, strike, riot, vandalism, the
making of necessary repairs or improvements, or any other cause
beyond Landlord's reasonable control. Tenant shall control the
temperature in the Premises to prevent freezing of any sprinkler
system.
(b) Landlord shall repair and maintain the roof,
gutters, downspouts, exterior walls, building structure,
foundation, exterior paved areas, and curbs of the Premises in
good condition. Except for such obligations of Landlord, Tenant
shall keep the Premises neatly maintained and in good order and
repair. Tenant's responsibility shall include maintenance and
repair of the electrical system, plumbing, drainpipes to sewers,
air-conditioning and heating systems, overhead and personnel
doors, and the replacement of all broken or cracked glass with
glass of the same quality. Tenant shall refrain from any
discharge that will damage the septic tank or sewers serving the
Premises.
(c) If the Premises have a separate entrance, Tenant
shall keep the sidewalks abutting the Premises or the separate
entrance free and clear of snow, ice, debris, and obstructions of
every kind.
4. Taxes, Assessments, and Operating Expenses.
(a) In conjunction with monthly rent payments, Tenant
shall each month pay a sum representing Tenant's proportionate
share of real property taxes and operating expenses for the
Premises. Such amount shall annually be estimated by Landlord in
good faith to reflect actual or anticipated costs. Upon
termination of this lease or at periodic intervals during the
term hereof, Landlord shall compute its actual costs for such
expenses during such period. Any overpayment by Tenant shall be
credited to Tenant, and any deficiency shall be paid by Tenant
within 15 days after receipt of Landlord's statement. Landlord's
records of expenses for taxes and operating expenses may be
inspected by Tenant at reasonable times and intervals.
(b) Tenant's proportionate share of real property
taxes shall mean that percentage of the total assessment
affecting the Premises which is the same as the percentage which
the rentable area of the Premises bears to the total rentable
area of all buildings covered by the tax statement. Tenant's
proportionate share of operating expenses for the Building shall
be computed by dividing the rentable area of the Premises by the
total rentable area of the Building. If in Landlord's reasonable
judgment either of these methods of allocation results in an
inappropriate allocation to Tenant, Landlord shall select some
other reasonable method of determining Tenant's proportionate
share.
(c) Real property taxes charged to Tenant hereunder
shall include all general real property taxes assessed against
the Premises or payable during the lease term, installment
payments on Bancrofted special assessments, and any rent tax, tax
on Landlord's interest under this lease, or any tax in lieu of
the foregoing, whether or not any such tax is now in effect.
Tenant shall not, however, be obligated to pay any tax based upon
Landlord's net income.
(d) Operating expenses charged to Tenant hereunder
shall include all usual and necessary costs of operating and
maintaining the Premises, Building, and any surrounding common
areas including, but not limited to, the cost of all utilities or
services not paid directly by Tenant, property insurance,
property management, maintenance and repair of landscaping,
parking areas, and any other common facilities. Operating
expenses shall not include roof replacement or correction of
structural deficiencies of the Building.
5. Parking and Storage Areas.
(a) Tenant, its employees, and customers shall have
the exclusive right to use any private parking spaces immediately
adjacent to the Premises. Tenant shall control the use of such
parking spaces so that there will be no unreasonable interference
with the normal traffic flow, and shall permit no parking on any
landscaped or unpaved surface. Under no circumstances shall
trucks serving the Premises be permitted to block streets.
(b) Tenant shall not store any materials, supplies, or
equipment outside in any unapproved or unscreened area. If
Tenant erects any visual barriers for storage areas, Landlord
shall have the right to approve the design and location. Trash
and garbage receptacles shall be kept covered at all times.
6. Tenant's Indemnification; Liability Insurance.
(a) Tenant shall not allow any liens to attach to the
Premises as a result of its activities. Tenant shall indemnify
and defend Landlord from any claim, liability, damage, or loss
arising out of any activity on the Premises by Tenant, its
agents, or invitees or resulting from Tenant's failure to comply
with any term of this lease.
(b) Tenant shall carry general liability insurance on
an occurrence basis with combined single limits of not less than
$1,000,000. Such insurance shall be provided by an insurance
carrier reasonably acceptable to Landlord and shall be evidenced
by a certificate delivered to Landlord stating that the coverage
will not be canceled or materially altered without 10 days'
advance written notice to Landlord. Landlord shall be named as
an additional insured on such policy.
7. Property Damage; Subrogation Waiver.
(a) If fire or other casualty causes damage to the
Building or the Premises in an amount exceeding 30 percent of the
full construction-replacement cost of the Building or Premises,
respectively, Landlord may elect to terminate this lease as of
the date of the damage by notice in writing to Tenant within 30
days after such date. Otherwise, Landlord shall promptly repair
the damage and restore the Premises to their former condition as
soon as practicable. Rent shall be reduced during the period to
the extent the Premises are not reasonably usable for the use
permitted by this lease because of such damage and required
repairs.
(b) Landlord shall be responsible for insuring the
Building, and Tenant shall be responsible for insuring its
personal property and trade fixtures located on the Premises.
(c) Neither party shall be liable to the other for any
loss or damage caused by water damage, sprinkler leakage, or any
of the risks covered by a standard fire insurance policy with
extended coverage and sprinkler leakage endorsements, and there
shall be no subrogated claim by one party's insurance carrier
against the other party arising out of any such loss.
8. Condemnation.
If a condemning authority takes the entire Premises or
a portion sufficient to render the remainder unsuitable for
Tenant's use, then either party may elect to terminate this lease
effective on the date that title passes to the condemning
authority. Otherwise, Landlord shall proceed as soon as
practicable to restore the remaining Premises to a condition
comparable to that existing at the time of the taking. Rent
shall be abated during the period of restoration to the extent
the Premises are not reasonably usable by Tenant, and rent shall
be reduced for the remainder of the term in an amount equal to
the reduction in rental value of the Premises caused by the
taking. All condemnation proceeds shall belong to Landlord.
9. Assignment and Subletting.
(a) Tenant shall not assign its interest under this
lease nor sublet the Premises without first obtaining Landlord's
consent in writing. This provision shall apply to all transfers
by operation of law or through mergers and changes in control of
Tenant. No assignment shall relieve Tenant of its obligation to
pay rent or perform other obligations required by this lease and
no one assignment or subletting shall be a consent to any further
assignment or subletting.
(b) Subject to the above limitations on transfer of
Tenant's interest, this lease shall bind and inure to the benefit
of the parties, their respective heirs, successors, and assigns.
10. Default.
Any of the following shall constitute a default by
Tenant under this lease:
(a) Tenant's failure to pay rent or any other charge
under this lease within 10 days after it is due, or failure to
comply with any other term or condition within 20 days following
written notice from Landlord specifying the noncompliance. If
such noncompliance cannot be cured within the 20-day period, this
provision shall be satisfied if Tenant commences correction
within such period and thereafter proceeds in good faith and with
reasonable diligence to effect compliance as soon as possible.
(b) Tenant's insolvency; assignment for the benefit of
its creditors; Tenant's voluntary petition in bankruptcy or
adjudication as bankrupt, or the appointment of a receiver for
Tenant's properties.
11. Remedies for Default.
In case of default as described in paragraph 10 above,
Landlord shall have the right to the following remedies which are
intended to be cumulative and in addition to any other remedies
provided under applicable law:
(a) Terminate this lease without relieving Tenant from
its obligation to pay damages.
(b) Retake possession of the Premises by summary
proceedings or otherwise, in which case Tenant's liability to
Landlord for damages shall survive the tenancy. Landlord may,
after such retaking of possession, relet the Premises upon any
reasonable terms. No such reletting shall be construed as an
acceptance of a surrender of Tenant's leasehold interest.
(c) Recover damages caused by Tenant's default which
shall include reasonable attorneys' fees at trial and on any
appeal therefrom. Landlord may sue periodically to recover
damages as they occur throughout the lease term, and no action
for accrued damages shall bar a later action for damages
subsequently accruing. Landlord may elect in any one action to
recover accrued damages plus damages attributable to the
remaining term of the lease equal to the difference between the
rent under this lease and the reasonable rental value of the
Premises for the remainder of the term, discounted to the time of
judgment at the rate of 6 percent per annum.
(d) Make any payment or perform any obligation
required of Tenant so as to cure Tenant's default, in which case
Landlord shall be entitled to recover all amounts so expended
from Tenant, plus interest at the rate of 10 percent per annum
from the date of the expenditure.
12. Surrender on Termination.
(a) On expiration or early termination of this lease,
Tenant shall deliver all keys to Landlord, have final utility
readings made on the date of move out, and surrender the Premises
clean and free of debris inside and out, with all mechanical,
electrical, and plumbing systems in good operating condition, all
signing removed and defacement corrected, and all repairs called
for under this lease completed. The Premises shall be delivered
in the same condition as at the commencement of the term, subject
only to depreciation and wear from ordinary use. Tenant shall
remove all of its furnishings and trade fixtures that remain its
property and restore all damage resulting from such removal.
Failure to remove said property shall be an abandonment of same,
and Landlord may dispose of it in any manner without liability.
(b) If Tenant fails to vacate the Premises when
required, including failure to remove all its personal property,
Landlord may elect either: (i) to treat Tenant as a tenant from
month to month, subject to all provisions of this lease except
the provision for term and at a base rental of 120 percent of
that specified in this lease; or (ii) to eject Tenant from the
Premises and recover damages caused by wrongful holdover.
13. Landlord's Liability.
(a) Landlord warrants that so long as Tenant complies
with all terms of this lease it shall be entitled to peaceable
and undisturbed possession of the Premises free from any eviction
or disturbance by Landlord or persons claiming through Landlord.
(b) All persons dealing with Pacific Realty
Associates, L.P. ("Partnership") must look solely to the property
and assets of Partnership for the payment of any claim against
Partnership or for the performance of any obligation of
Partnership as neither the general partner, limited partners,
employees, nor agents of Partnership assume any personal
liability for obligations entered into on behalf of Partnership
(or its predecessors in interest) and their respective properties
shall not be subject to the claims of any person in respect of
any such liability or obligation. As used herein, the words
"property and assets of partnership" exclude any rights of
Partnership for the payment of capital contributions or other
obligations to it by the general partner or any limited partner
in such capacity.
14. Mortgage or Sale by Landlord; Estoppel Certificates.
(a) This lease is and shall be prior to any mortgage
or deed of trust ("Encumbrance") recorded after the date of this
lease and affecting the Building and the land upon which the
Building is located. However, if any lender holding an
Encumbrance secured by the Building and the land underlying the
Building requires that this lease be subordinate to the
Encumbrance, then Tenant agrees that this lease shall be
subordinate to the Encumbrance if the holder thereof agrees in
writing with Tenant that so long as Tenant performs its
obligations under this lease no foreclosure, deed given in lieu
of the foreclosure, or sale pursuant to the terms of the
Encumbrance, or other steps or procedures taken under the
Encumbrance shall affect Tenant's rights under this lease. If
the foregoing condition is met, Tenant shall execute the written
agreement and any other documents required by the holder of the
Encumbrance to accomplish the purposes of this paragraph.
(b) If the Building is sold as a result of foreclosure
of any Encumbrance thereon or otherwise transferred by Landlord
or any successor, Tenant shall attorn to the purchaser or
transferee, and the transferor shall have no further liability
hereunder.
(c) Either party shall 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 of
whom the certificate was requested that the lease is in full
force and effect and has not been modified except as may be
represented by the party requesting the certificate.
15. Disputes - Attorneys' Fees.
In the event of any litigation arising out of this
lease, the prevailing party shall be entitled to recover from the
other party, in addition to all other relief provided by law or
judgement, its reasonable costs and attorneys' fees incurred both
at and in preparation for trial and any appeal or review, such
amount to be as determined by the court(s) before which the
matter is heard. Disputes between the parties which are to be
litigated shall be tried before a judge without a jury.
16. Severability.
If any provision of this lease is held to be invalid,
unenforceable or illegal the remaining provisions shall not be
affected and shall be enforced to the fullest extent permitted by
law.
17. Interest and Late Charges.
Rent not paid within 10 days of when due shall bear
interest from the date due until paid at the rate of 10 percent
per annum. Landlord may at its option impose a late charge of
$.05 for each $1.00 of rent for rent payments made more than 10
days late in addition to interest and other remedies available
for default.
18. General Provisions.
(a) Waiver by either party of strict performance of
any provision of this lease shall not be a waiver of nor
prejudice the party's right otherwise to require performance of
the same provision or any other provision.
(b) Subject to the limitations on transfer of Tenant's
interest, this lease shall bind and inure to the benefit of the
parties, their respective heirs, successors, and assigns.
(c) 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 the Premises,
or to show the Premises to any prospective tenant or purchasers.
During the last two months of the term, Landlord may place and
maintain upon the Premises notices for leasing or sale of the
Premises.
(d) If this lease commences or terminates at a time
other than the beginning or end of one of the specified rental
periods, then the rent (including Tenant's share of real property
taxes, if any) shall be prorated as of such date, and in the
event of termination for reasons other than default all prepaid
rent shall be refunded to Tenant or paid on its account.
(e) Notices between the parties relating to this lease
shall be in writing, effective when delivered, or if mailed,
effective on the second day following mailing, postage prepaid,
to the address for the party stated in this lease or to such
other address as either party may specify by notice to the other.
Rent shall be payable to Landlord at the same address and in the
same manner.
19. Tenant Improvements.
The Premises shall be taken by Tenant in "as-is"
condition with existing improvements configured generally as
shown on the attached Exhibit A except that Tenant shall, at its
expense, install a fence as shown on Exhibit A.
IN WITNESS WHEREOF, the duly authorized representatives
of the parties have executed this lease as of the day and year
first written above.
REAL ESTATE PROPERTIES LIMITED FRED MEYER, INC.,
PARTNERSHIP, an Oregon limited a Delaware corporation
partnership
By FMGP Associates, an Oregon
limited partnership, its
General Partner
By FMGP Incorporated, a
Delaware corporation,
its General Partner
By DAVID W. RAMUS By SCOTT L. WIPPEL
----------------------- ---------------------------
David W. Ramus Name _________________________
Vice President Title ________________________
By ______________________
Name ______________________
Title _____________________
Address for Notices/ Address for Legal Notices
Rent Payments to Landlord: to Tenant:
15115 S.W. Sequoia Parkway, ______________________________
Suite 200 ______________________________
Portland, Oregon 97224-7199 ______________________________
Address for Invoices
to Tenant:
______________________________
______________________________
______________________________