Commercial Lease Agreement - Oregon

COMMERCIAL LEASE AGREEMENT

(Oregon – Comprehensive Template)

TABLE OF CONTENTS

1. Document Header
2. Definitions
3. Premises, Term & Possession
4. Rent; Additional Charges
5. Use of Premises
6. Representations & Warranties
7. Covenants & Restrictions
8. Maintenance, Repairs & Alterations
9. Insurance; Waiver of Subrogation
10. Environmental Compliance
11. Assignment & Subletting
12. Default & Remedies
13. Risk Allocation
14. Dispute Resolution
15. General Provisions
16. Execution Block

1. DOCUMENT HEADER

1.1 Parties.
This Commercial Lease Agreement (“Agreement”) is entered into as of [EFFECTIVE DATE] (the “Effective Date”) by and between [LANDLORD LEGAL NAME], a [STATE OF FORMATION & ENTITY TYPE] (“Landlord”), and [TENANT LEGAL NAME], a [STATE OF FORMATION & ENTITY TYPE] (“Tenant”). Landlord and Tenant are sometimes referred to herein individually as a “Party” and collectively as the “Parties.”

1.2 Recitals.
A. Landlord is the fee owner of the real property and improvements commonly known as [PROPERTY NAME / ADDRESS], located in the State of Oregon (the “Building”).
B. Tenant desires to lease from Landlord, and Landlord desires to lease to Tenant, certain premises within the Building on the terms and conditions set forth herein.
C. The Parties enter into this Agreement in consideration of the mutual promises and obligations herein.

2. DEFINITIONS

The following capitalized terms have the meanings set forth below and apply equally to singular and plural forms. Defined terms appear throughout this Agreement.

“Additional Rent” – All amounts (other than Base Rent) required to be paid by Tenant under this Agreement, including Operating Expenses, Taxes, late charges, and indemnity obligations.

“Affiliate” – Any entity controlling, controlled by, or under common control with a Party.

“Base Rent” – The fixed rent payable pursuant to Section 4.1.

“Building Rules” – The rules and regulations promulgated by Landlord from time to time pursuant to Section 7.4.

“Commencement Date” – The earlier of (a) [INSERT DATE], or (b) the date Tenant first takes possession of the Premises for the conduct of its business.

“Event of Default” – Any default described in Section 12.1.

“Hazardous Materials” – Any substance, waste, or material classified as hazardous, toxic, contaminant, or pollutant under applicable Environmental Laws.

“Lease Term” – The period commencing on the Commencement Date and ending on the Expiration Date, as each may be extended or earlier terminated in accordance with this Agreement.

“Operating Expenses” – All costs of owning, operating, managing, repairing, and maintaining the Building and the Land (as defined below), excluding those costs expressly excluded under Section 4.4.

“Premises” – The portion of the Building shown on Exhibit A, containing approximately ☐ rentable square feet, together with the appurtenant right to use Common Areas.

“Taxes” – Real property taxes, special assessments, and all other governmental charges imposed with respect to the Building or Land, as allocated under Section 4.3.

3. PREMISES, TERM & POSSESSION

3.1 Lease Grant. Landlord leases to Tenant, and Tenant leases from Landlord, the Premises for the Lease Term, together with the non-exclusive right to use Common Areas.

3.2 Lease Term. The Lease Term shall commence on the Commencement Date and expire at 11:59 p.m. on [EXPIRATION DATE] (the “Expiration Date”), unless extended or earlier terminated pursuant hereto.

3.3 Delivery & Acceptance.
(a) Condition. Landlord shall deliver the Premises in “AS-IS” condition, broom-clean, with all Building systems serving the Premises in good working order.
(b) Punch List. Tenant shall, within ten (10) days after taking possession, deliver a written punch list of latent defects; failure to timely do so shall constitute conclusive acceptance.
(c) Delay in Delivery. If Landlord fails to deliver possession on or before the Scheduled Commencement Date, Rent shall abate until delivery; such delay shall not constitute Landlord default unless exceeding [___] days.

3.4 Option(s) to Extend. [OPTIONAL – Insert renewal rights with notice deadlines, fair-market rent methodology, and conditions precedent.]

4. RENT; ADDITIONAL CHARGES

4.1 Base Rent. Tenant shall pay monthly Base Rent in the amounts set forth below, in advance, on or before the first (1st) day of each calendar month:

Year 1: $[___] per RSF | $[Total] per month
Year 2: $[___] per RSF | $[Total] per month
…

4.2 Operating Expense & Tax Pass-Through. Tenant shall pay its Pro Rata Share ([Premises RSF ÷ Building RSF] %) of Operating Expenses and Taxes as Additional Rent, payable monthly based on Landlord’s estimate and subject to annual reconciliation.

4.3 Taxes. “Taxes” include any governmental levy on real property, personal property of Landlord used in connection with the Building, or rent (other than federal/state income taxes). [Consider carve-outs for capital gains, franchise taxes, etc.]

4.4 Exclusions from Operating Expenses. Operating Expenses shall not include: (i) capital improvements (except those that reduce Operating Expenses or are required by new laws, amortized over useful life); (ii) depreciation; (iii) interest or principal on debt; (iv) costs reimbursed by insurance; (v) leasing commissions.

4.5 Late Charge & Interest. Any Rent not received within five (5) days after due shall accrue a late charge of five percent (5 %) of the overdue amount plus interest at the lesser of ten percent (10 %) per annum or the maximum rate permitted by law.

4.6 Payment Method. All payments shall be made in lawful U.S. funds by ACH or other method reasonably designated by Landlord to [PAYMENT ADDRESS / ACCOUNT].

5. USE OF PREMISES

5.1 Permitted Use. Tenant shall use the Premises solely for [DESCRIBE USE; e.g., general office, light manufacturing, retail] and for no other purpose without Landlord’s prior written consent.

5.2 Compliance with Laws. Tenant shall, at its sole cost, comply with all applicable federal, state, and local laws, ordinances, regulations, and codes (“Laws”) respecting (a) the Premises, (b) Tenant’s use and occupancy, and (c) Tenant Improvements.

5.3 Prohibited Activities. Tenant shall not (a) create nuisance or unreasonable noise, odors, or vibrations, (b) use Hazardous Materials except in compliance with Section 10, or (c) overload Building systems.

5.4 Continuous Operation. [Optional for retail] Tenant shall operate its business in the Premises continuously during normal business hours, except during remodel or Force Majeure.

6. REPRESENTATIONS & WARRANTIES

6.1 Mutual Reps. Each Party represents to the other that:
(a) It is duly organized, validly existing, and in good standing under the laws of its formation state, and qualified to do business in Oregon;
(b) It has full power and authority to enter into and perform this Agreement; and
(c) This Agreement constitutes its valid and binding obligation.

6.2 Landlord’s Limited Warranty. Landlord warrants that, to Landlord’s actual knowledge as of the Effective Date, (i) the Premises are not subject to any pending condemnation, and (ii) Landlord has not received written notice of material Building code violations unresolved as of the Effective Date.

6.3 Disclaimer of Implied Warranties. EXCEPT AS EXPRESSLY SET FORTH HEREIN, LANDLORD MAKES NO WARRANTY, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF HABITABILITY, FITNESS, MERCHANTABILITY, OR SUITABILITY FOR TENANT’S INTENDED USE.

6.4 Survival. The representations and warranties in Sections 6.1-6.3 shall survive the delivery of this Agreement but shall be subject to any applicable notice and cure periods.

7. COVENANTS & RESTRICTIONS

7.1 Affirmative Covenants of Tenant. Tenant shall:
(a) Pay Rent and perform its obligations timely;
(b) Maintain the Premises in neat and sanitary condition;
(c) Promptly give Landlord notice of any condition requiring repair;
(d) Carry insurance as required by Section 9;
(e) Deliver estoppel certificates within ten (10) business days after request.

7.2 Negative Covenants of Tenant. Tenant shall not:
(a) Make structural alterations without Landlord’s prior written consent;
(b) Place liens against the Premises (any such lien must be removed within ten (10) days);
(c) Use the Premises for any immoral, illegal, or objectionable purpose.

7.3 Landlord Covenants. Landlord shall maintain structural components, roof, and Building systems serving the Premises in good working order, except to the extent caused by Tenant’s acts or omissions.

7.4 Building Rules. Tenant shall comply with the Building Rules attached as Exhibit B, as reasonably modified by Landlord following thirty (30) days’ written notice.

8. MAINTENANCE, REPAIRS & ALTERATIONS

8.1 Tenant Obligations. Tenant, at its expense, shall keep the Premises (excluding structural components) in good order and promptly make all necessary non-structural repairs.

8.2 Landlord Obligations. Landlord shall maintain the structural portions of the Building, roof, exterior walls, and Building systems; the cost thereof shall be included in Operating Expenses except as otherwise provided.

8.3 Alterations. Any Alterations shall (i) be performed in accordance with Laws, (ii) require Landlord’s prior written approval (except for decorative, non-structural work under $[___]), and (iii) become Landlord’s property upon installation unless Landlord elects removal.

8.4 Mechanic’s Liens. Tenant shall keep the Premises free of liens; if a lien is filed, Tenant must bond or discharge it within ten (10) business days.

9. INSURANCE; WAIVER OF SUBROGATION

9.1 Tenant Insurance. Tenant shall maintain, at its expense:
(a) Commercial General Liability Insurance with limits not less than $[___] combined single limit per occurrence;
(b) Property insurance covering Tenant’s personal property and Alterations on an “all-risk” basis at replacement cost;
(c) Workers’ compensation coverage, if any, required by applicable law.

9.2 Landlord Insurance. Landlord shall maintain property insurance on the Building (excluding Tenant’s personal property) and liability insurance customary for similar properties.

9.3 Certificates. Certificates of insurance shall be delivered prior to occupancy and on renewal, naming Landlord (and its mortgagee, if any) as additional insureds where applicable.

9.4 Waiver of Subrogation. Each Party waives and releases the other, and their respective insurers waive subrogation, for any loss covered (or which should have been covered) by property insurance.

10. ENVIRONMENTAL COMPLIANCE

10.1 Tenant Use of Hazardous Materials. Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, generated, or used in or about the Premises except for ordinary office or cleaning supplies in reasonable quantities and in compliance with all Environmental Laws.

10.2 Compliance. Tenant shall (a) comply with all Environmental Laws; (b) obtain and maintain all required permits; (c) provide copies of any environmental report or notice received relating to the Premises.

10.3 Tenant Indemnity. Tenant shall indemnify, defend, and hold Landlord harmless from all claims, costs, and liabilities (including remediation and attorneys’ fees) arising from Tenant’s breach of Section 10 or the presence of Hazardous Materials introduced by Tenant, its employees, invitees, or contractors.

10.4 Environmental Inspections. Landlord may enter and conduct environmental testing upon reasonable notice if Landlord reasonably suspects contamination caused by Tenant.

11. ASSIGNMENT & SUBLETTING

11.1 Consent Required. Tenant shall not assign this Agreement or sublet all or any part of the Premises without Landlord’s prior written consent, which shall not be unreasonably withheld, conditioned, or delayed, subject to Section 11.2.

11.2 Permitted Transfers. No consent shall be required for (a) a transfer to an Affiliate resulting from a merger, consolidation, or sale of substantially all Tenant’s assets, provided net worth is not diminished and Tenant remains liable, or (b) an assignment to a successor entity resulting from internal reorganization, provided written notice is delivered to Landlord at least fifteen (15) days prior to the transfer.

11.3 Recapture. For any proposed sublease of fifty percent (50 %) or more of the Premises for the remainder of the Lease Term, Landlord may, within ten (10) business days, elect to recapture the affected portion in lieu of consenting.

11.4 Sharing of Profit. If Tenant assigns or subleases at a rental rate in excess of the effective rate payable hereunder, Tenant shall pay Landlord fifty percent (50 %) of the net profit, after reasonable brokerage fees and tenant improvement costs amortized over the term of the sublease.

11.5 No Release. Consent to any assignment or sublease shall not release Tenant from its obligations unless Landlord expressly so agrees in writing.

12. DEFAULT & REMEDIES

12.1 Events of Default. Each of the following constitutes an “Event of Default”:
(a) Monetary Default – Failure to pay any Rent within five (5) days after written notice (notice deemed given on first failure in a rolling 12-month period);
(b) Non-Monetary Default – Failure to perform any non-monetary obligation within thirty (30) days after notice (or such longer period as reasonably required provided Tenant commences cure within thirty (30) days and diligently pursues completion);
(c) Insolvency – Tenant’s insolvency, assignment for benefit of creditors, or filing of a bankruptcy petition not dismissed within sixty (60) days, but only to the extent this provision and any resulting remedy are enforceable under applicable law;
(d) Abandonment – Vacating or deserting the Premises for fifteen (15) consecutive days while in monetary default.

12.2 Remedies. Upon an Event of Default, Landlord may exercise only remedies available under this Agreement and applicable law, including:
(a) Terminate this Agreement and recover possession by Tenant’s voluntary surrender, by a lawful and peaceable entry if a right of entry is provided by law and stated in this Agreement, or through a forcible-entry or wrongful-detainer action and enforcement of a judgment of restitution under ORS 105.105, 105.110 and 105.151;
(b) Recover accrued Rent and other damages, and pursue any future-Rent or liquidated-damages remedy only to the extent enforceable, with credit for amounts avoided or recovered through reletting and without double recovery;
(c) After lawfully recovering possession, relet the Premises and recover any deficiency permitted by this Agreement and applicable law;
(d) Enforce the lien on covered Tenant chattels provided by ORS 87.162 only after the lien attaches under ORS 87.166 and only through procedures permitted by law;
(e) Seek injunctive relief or specific performance where available; and
(f) Recover reasonable attorneys’ fees and costs as provided in Section 14.5 and ORS 20.096.

12.3 Mitigation. Landlord shall use commercially reasonable efforts to mitigate damages and shall credit Tenant with net amounts recovered through reletting that are allocable to the remaining Lease Term.

12.4 Landlord Default. Landlord shall not be in default unless Landlord fails to perform its obligations within thirty (30) days after receipt of Tenant’s written notice (extended as reasonably necessary where performance requires more than thirty (30) days and Landlord diligently pursues completion). Subject to applicable law, Tenant’s contractual remedies are actual damages or specific performance; no rent offset is permitted except as expressly provided.

13. RISK ALLOCATION

13.1 Indemnification.
(a) Tenant Indemnity. Tenant shall indemnify, defend, and hold Landlord harmless from and against all claims, damages, fines, and expenses arising from (i) Tenant’s use or occupancy of the Premises, (ii) any act or omission of Tenant or its agents, employees, contractors, or invitees, or (iii) breach of this Agreement, except to the extent caused by Landlord’s gross negligence or willful misconduct.
(b) Landlord Indemnity. Landlord shall indemnify Tenant from claims arising from Landlord’s gross negligence or willful misconduct occurring in the Common Areas or Building systems.

13.2 Limitation of Liability. Landlord’s liability to Tenant for any reason shall not exceed [CAP AMOUNT OR “the equity interest of Landlord in the Building”]. In no event shall either Party be liable for lost profits, consequential, or punitive damages, except in connection with third-party indemnified claims or willful misconduct.

13.3 Insurance Proceeds. Indemnification obligations shall be net of any insurance proceeds actually received.

13.4 Force Majeure. Except for monetary obligations, performance is excused during delay caused by acts of God, governmental actions, labor disputes, shortages, or other events beyond the impacted Party’s reasonable control (“Force Majeure Event”), provided the Party gives prompt notice and resumes performance promptly upon cessation.

14. DISPUTE RESOLUTION

14.1 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Oregon, without regard to conflict-of-laws principles.

14.2 Forum Selection. The state courts located in [COUNTY, OREGON] (and, if applicable, the federal courts for the District of Oregon) shall have exclusive jurisdiction, except that an action for possession must be filed in the court and county required by ORS 105.110 and other applicable law.

14.3 Arbitration. [OPTIONAL] If elected by initialing below, any dispute (except actions for possession or injunctive relief under Section 12.2(e)) shall be resolved by binding arbitration administered by [AAA/JAMS] under its commercial rules.
Landlord Initials: _____ Tenant Initials: _____

14.4 Jury Trial Waiver. [OPTIONAL — DO NOT SELECT WITHOUT OREGON COUNSEL CONFIRMING ENFORCEABILITY, SCOPE, PRESENTATION, AND CONSENT FOR THIS TRANSACTION.] EACH PARTY WAIVES TRIAL BY JURY IN ANY ACTION ARISING OUT OF THIS AGREEMENT.
Landlord Initials: _____ Tenant Initials: _____

14.5 Attorneys’ Fees. In any action or proceeding to enforce this Agreement, the prevailing Party shall be entitled to recover reasonable attorneys’ fees and costs under ORS 20.096, including on appeal and, to the extent allowed by applicable law, in bankruptcy.

15. GENERAL PROVISIONS

15.1 Amendments & Waivers. No amendment or waiver is effective unless in writing signed by both Parties. A waiver is effective only for the specific instance given.

15.2 Notices. All notices shall be in writing and deemed given (a) on receipt if delivered by hand-delivery with signed receipt; (b) one (1) business day after deposit with a nationally recognized overnight courier; or (c) three (3) days after mailing by certified U.S. Mail, return receipt requested, to the addresses set forth below (or as updated by notice).
Landlord: [ADDRESS]
Tenant: [ADDRESS]

This Section governs contractual notices only. A notice to terminate the tenancy or to quit that will support a possession action must also be served in the manner and for the period required by ORS 91.110 and 105.120; delivery under this Section alone is not a substitute for those statutory requirements.

15.3 Successors & Assigns. This Agreement shall bind and inure to the benefit of the Parties and their permitted successors and assigns.

15.4 Severability. If any provision is held invalid, the remainder shall be enforced to the fullest extent permitted, and a valid provision as close as possible shall be substituted.

15.5 Entire Agreement. This Agreement (including exhibits) constitutes the entire agreement of the Parties, superseding all prior negotiations and understandings.

15.6 Counterparts; Electronic Signatures. The Parties agree to conduct the execution of this Agreement by electronic means. This Agreement may be executed in counterparts and delivered electronically. Under ORS 84.013, 84.019 and 84.025, a record, signature, or contract may not be denied legal effect solely because it is electronic, but attribution and effect remain subject to the Parties’ agreement, context, surrounding circumstances, and other applicable law.

15.7 No Merger. Termination of this Agreement shall not impair rights or obligations accruing prior to termination.

15.8 Recording. If either Party requests a recorded memorandum and Oregon counsel confirms that recording is appropriate, the Parties shall execute a separate short-form memorandum of lease that satisfies then-current recording requirements; Tenant shall pay agreed recording costs.

16. EXECUTION BLOCK

IN WITNESS WHEREOF, the Parties have executed this Commercial Lease Agreement as of the Effective Date.

LANDLORD:
[LANDLORD LEGAL NAME], a [ENTITY TYPE]
By: _______________________________
Name: _____________________________
Title: ______________________________

Date: ______________________________

TENANT:
[TENANT LEGAL NAME], a [ENTITY TYPE]
By: _______________________________
Name: _____________________________
Title: ______________________________

Date: ______________________________

EXHIBIT A – Floor Plan / Legal Description

[Attach scaled drawing or metes-and-bounds description.]

EXHIBIT B – Building Rules & Regulations

[Insert rules regarding hours of operation, deliveries, signage, etc.]

EXHIBIT C – Work Letter (If Landlord Delivering TI Allowance)

[Detail scope of improvements, schedule, allowance, and disbursement mechanics.]