HomeMy WebLinkAbout2004-07-09 Resolution Prepared by: Andy Matthews, Asst. City Atty., 410 E. Washington St., Iowa City, IA 52240 (319) 356-5030
RESOLUTION NO. 04-200
RESOLUTION OF INTENT TO ENTER INTO A FIVE YEAR LEASE
AGREEMENT WITH OPTIONS TO RENEW BETWEEN THE CITY OF IOWA
CITY AND BRADFORD CHILD CARE SERVICES, INC. FOR OPERATION OF
AN APPLE TREE CHILDREN'S CENTER IN THE COURT STREET
TRANSPORTATION CENTER, AND SETrlNG A PUBLIC HEARING FOR JULY
14, 2004.
WHEREAS, the Court Street Transportation Center under construction includes commercial
space which will provide a child care component; and
WHEREAS, the City of Iowa City has negotiated a lease agreement with Bradford Child Care
Services, Inc. to operate a childcare center in said facility, which lease is attached hereto and
requires City Council approval.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF IOWA
CITY, IOWA, THAT:
1. The City Council does hereby declare its intent to approve the attached lease agreement
between the City of Iowa City and Bradford Child Care Services, Inc. for a five year lease
with options to renew in accordance with that agreement.
2. A public hearing on said proposed agreement should be and is hereby set for July 14,
2004 at 11:30:00 a.m. in Emma J. Harvat Hall of City Hall, 410 E. Washington Street, Iowa
City, IA or if said meeting is cancelled, at the next meeting of the City Council thereafter as
posted by the City Clerk. The City Clerk is hereby directed to cause notice of public
hearing to be published as provided by law.
Passed and approved this qth day of July ,20 04 ·
Approved by
ATTEST: ,/~~ ,~- ~"/~r~,2 ~ 2'-,-'¢~/
CITY~ERK City Attorney's Office
Resolution No. 04-200
Page 2
It was moved by Champion and seconded by 0'Donnel 1 the Resolution be
adopted, and upon roll call there were:
AYES: NAYS: ABSENT:
X Bailey
X . Champion
X Elliott
X Lehman
X O'Donnell
X Vanderhoef
X Wilbum
LEASE
THIS LEASE (the "Lease") dated this 14th day of July ,2004, is
made and entered into by and between the City of Iowa City, Iowa, a municipal
corporation, ("Landlord"), and BRADFORD CHILD CARE SERVICES, INC., a
Pennsylvania not-for-profit corporation ("Tenant").
WITNESSETH
That for and in consideration of the rentals hereinafter reserved and of the mutual
covenants and agreements hereinafter set forth, Landlord and Tenant do hereby agree
as follows with the intent to be legally bound hereby:
Section 1. Premises, Construction and Delivery.
(a) For and in consideration of the Rent (as defined in Paragraph 3 of
this Lease) and of the covenants, conditions and agreements herein contained,
Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord, the
property and building located at 325 South Dubuque St., Iowa City, in the County of
Johnson and State of Iowa, together with all improvements, appurtenances, fixtures,
rights and privileges thereto consisting of approximately 8,083 square feet of improved
building space plus a playground area outside of the building of approximately 2,733
square feet (collectively, the "Premises"), as further described in Exhibit A - Legal
Description, and as shown on Exhibit B - Site and Floor Plan, attached hereto and
made a part hereof.
(b) [Construction Requirements and Specifications] Landlord, at its
cost, agrees to provide the Premises to Tenant as identified in Section l(a), consistent
with the site plan and design specifications prepared by OPN Architects, Inc., and
drawings #Al16, #A122, #A402, #A403, #M1.05, #P1.05, #P1.06, #E1.01, #E2.01,
#E4.00, #E6.00, #E6.01, #E6.02, and #E6.03, which are incorporated herein by this
reference. Landlord shall provide an electronic security system consisting of electrified
doors and a keyed or card system to enable Tenant to access the various exterior doors
and selected interior doors accessible from the exterior door entrances. Tenant shall be
responsible for, and shall pay all costs associated with the fit-out of the subject
premises, consisting of non-fixtures, furniture, any floor coverings, and playground
equipment other than the resilient playground and deck surface, which Landlord shall
provide pursuant to design plans and specifications,
(c) [Delivery Schedule]: The subject Premises will be delivered
between May 1, 2005 and July 1, 2005, with the specific date of
delivery constituting the "Delivery Date", following issuance of a
certificate of occupancy to Landlord by the City of Iowa City's
Housing and Inspection Services. Landlord shall provide Tenant
with fourteen (14) days' notice of the Delivery Date, to Permit the
subject Premises to be available to Tenant for Tenant's fit-out work.
If Tenant, with Landlord's written consent, occupies the Premises
prior to the Commencement Date as set forth in Section 2, the
obligations in this lease, including Base Rent and any other
payment obligations hereunder shall be in effect during such
period. Any early possession shall not affect nor advance the
expiration date of the original term of this lease, except that Tenant
shall be allowed access to the Premises one month prior to the
date set for commencement of the Lease Term set in Section 2 for
the purpose of completing its fixturing of the Premises without any
rent becoming due and owing during said month.
(d) Liquidated Damages: Landlord and Tenant recognize that time is of
the essence and that Tenant will suffer financial loss if the
Premises are not available for Tenant by the date specified in
Section 2 herein. The Tenant asserts, and the Landlord also
recognizes the delays, expenses and difficulties involved in proving
in a legal proceeding the actual loss suffered by the Tenant if the
Premises are not available for Tenant within the time specified in
Section 2 herein. Accordingly, instead of requiring such proof, it is
intended that this Lease shall include provisions for Liquidated
Damages to be paid in the event Tenant is unable to occupy the
Premises on the date set for commencement of the tenancy herein
(but not as a penalty) in accordance with the provisions set forth
herein. Liquidated damages in the amount of $1,000 per day will be
paid by the Landlord to the Tenant for each calendar day that
expires after the dates established in Section 2 for commencement
of the term of the lease,
Section 2. Term. The term of this Lease shall be for a period of five (5) years
(the "Term"), commencing thirty (30) days following the Delivery Date as set out in
Section 1(c) herein, (the "Commencement Date"), and terminating at midnight on the
last day of the month, sixty (60) months thereafter, unless extended pursuant to
Section 22 of this Lease, or earlier terminated pursuant to the provisions of this Lease.
Section 3. Rent.
(a) Commencing on the Commencement Date, Tenant shall pay to
Landlord as base rent for the Premises the sum of $40,415.04 for the first year, payable
in equal monthly installments at the rate of $3,367.92 per month for each month of the
first year of the Term (the "Base Rent"); thereafter, for years two through and including
year five of the first lease term, Tenant shall pay the sum of $82,850.76 annually,
payable in equal monthly installments at the rate of $6,904.23 per month for each month
of the Term.
(b) All Base Rent shall be paid monthly, in advance, on the first day of
each month during the Term or any extensions thereof.
(c) Payment of Base Rent shall be made to The City of Iowa City, Att'n:
Assistant Controller, 410 E. Washington St., Iowa City, IA 52240, or at such other place
as shall from time to time be designated by Landlord in writing.
(d) Each monthly payment of Base Rent shall have a ten (10) day
grace period, after which a late fee of two percent (2%) of the amount due shall be
imposed. Landlord shall use good faith efforts to notify Tenant of a failure to make
payment within five (5) days after the due date.
(e) All sums other than Base Rent required to be paid by Tenant
pursuant to this Lease, whether to Landlord or to other parties, shall be considered as
"Additional Rent." Base Rent and Additional Rent are sometimes collectively referred to
in this Lease as "Rent." The failure to pay any item of Additional Rent shall carry the
same consequences as the failure to pay Base Rent.
Section 4. Operatinq Expenses.
(a) The parties believe that Tenant's business practices and activities
will not cause the real estate to be subject to property taxation pursuant to Iowa Code §
427.1(2) and § 427.1(8), and other applicable Iowa Code provisions, and accordingly,
Landlord shall be responsible for the payment of all real estate and other ad valorem
taxes and assessments applicable to the Premises, the building and the land on which
the building is located (the "Land"), and any other tax imposed against Landlord with
respect to the Premises and the Land, by federal, state or local taxing authorities or as a
substitution for or in addition to the current method of property taxation used for the
funding of governmental services. In the event Tenant changes its business practices or
activities such that the Premises become subject to such taxation, such taxes shall be
the obligation of the Tenant, and Tenant shall timely pay such taxes. Landlord and/or
Tenant shall have the right to appeal such taxes pursuant to Iowa law. If the Premises
occupied by the Tenant become subject to taxation for reasons other than a change in
the Tenant's business practices or activities, Landlord agrees to assume responsibility
for payment of such taxes as identified herein.
(b) Landlord shall promptly pay and discharge operating expenses of
the Premises consisting of all landscaping, the cost of maintenance and repair of the
exterior of the building, snow removal and cleaning of the sidewalks and parking areas,
and cleaning. It is the intent that, except as may be otherwise provided in this Lease,
Landlord shall contract for and directly incur and discharge all operating expenses for
the Premises, including exterior lighting, but excluding janitorial services, trash removal,
and utilities, which shall be separately metered and which are the responsibility of
Tenant. Tenant shall be responsible for cleaning and janitorial services for the interior of
the Premises. Landlord shall be responsible for cleaning exterior windows of the
Premises twice a year. Tenant shall have no obligations with respect to any of the other
operating expenses except as specifically provided in this Lease.
(c) Landlord covenants and agrees that it shall maintain or cause to be
maintained, the Common Areas of the Land and the building in good order and repair at
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its sole cost and expense, consistent with the standards applicable to first-class retail or
mixed-use developments within the trade area in which the Property is located.
Common Areas is defined as and shall consist of all parking areas, landscaped areas,
streets, sidewalks, driveways, elevators, loading platforms, washrooms, lounges,
vestibules and hallways, and other facilities available for joint use, all as they may from
time to time exist and be available to all the tenants on the Property and their
employees, agents, customers, licensees and invitees.
Section 5. Use.
(a) Tenant shall use the Premises for child care and/or early education
services, and related services, and for no other purpose.
(b) Landlord shall obtain a certificate of occupancy for the Premises, if
one is required by applicable law for Tenant's occupancy. Landlord represents that the
Premises comply with all applicable local, state and federal laws, ordinances, statutes,
orders, rules and regulations ("Laws") as of the date of this Lease, and that Tenant's
proposed use of the Premises is in compliance with applicable zoning ordinances.
(c) Tenant shall obtain all necessary permits required by the city,
county or any governing authority having jurisdiction over the Premises in order for
Tenant to lawfully conduct its business as described in Paragraph 5(a) above on the
Premises. Tenant shall make diligent, good faith efforts to obtain all such permits so
required as soon as possible after the execution of this Lease.
(d) Notwithstanding any other provision of this Lease, Tenant shall not
be required to operate in the Premises, and no term or condition of this Lease shall be
deemed to be an implied covenant to operate. In the event, however, that Tenant
discontinues operations at the Premises, Tenant shall continue to pay Rent and perform
its obligations as required by this Lease.
Section 6. Compliance. Tenant shall, during the Term of this Lease, conform
the use Tenant makes of the Premises to all Laws, provided that the provisions of this
Paragraph 6 shall not require the Tenant to rebuild, repair or alter the Premises and/or
the improvements forming a part of the Premises in order to make said Premises and/or
improvements comply with any such Laws, and provided further that if Tenant is unable
to use the Premises for the purposes specified in Paragraph 5(a), Tenant shall have the
right to terminate this Lease immediately upon written notice to Landlord. Landlord shall
make any structural additions or improvements to the Premises which are necessary in
order for the Premises to be in compliance with Laws.
Section 7. ADA Compliance. Landlord and Tenant agree that any
improvements undertaken on the Premises shall be performed in accordance with the
Americans With Disabilities Act Accessibility Guidelines, to the extent applicable under
Title III of the Americans With Disabilities Act (ADA). Furthermore, Landlord and Tenant
agree to make "good faith" efforts to comply with the ADA Guidelines regarding the
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Premises. To the best of Landlord's and Tenant's knowledge, the Premises currently
comply with the ADA.
Section 8. Chanqes, Alterations and Additions. Tenant shall have the right to
make any minor change, alteration or addition to the Premises without Landlord's
approval, provided such change, alteration or improvement costs no more than FIVE
THOUSAND AND 00/100s DOLLARS ($5,000.00). No change, alteration or addition
costing more than $5,000.00 shall be made to the Premises by Tenant without the prior
approval of Landlord, which approval shall not be unreasonably withheld or delayed;
provided, however, that repainting, repapering or changing of floor covering is excluded
from said $5,000.00 threshold. In seeking Landlord's approval, Tenant shall submit a
written description of the proposed work along with plans and drawings respecting same
to Landlord for Landlord's approval, which approval shall not be unreasonably delayed
or withheld. Landlord shall approve or disapprove same within fifteen (15) days after
receipt thereof, and if Landlord fails to disapprove such plans and drawings by notice in
writing to Tenant within such time, they shall be deemed approved. Landlord agrees, if
necessary, to join in any applications to governmental authorities for such permits as
may be required to do the work contemplated in this Paragraph 8. Any permanent
additions to or alterations of the Premises which cannot be removed without matedal
damage to the Premises, except Tenant's Personal Property (as hereinafter defined),
shall become a part of the realty and belong to Landlord unless otherwise agreed by
Landlord and Tenant. Tenant's removable paneling and wall fixtures and furniture, trade
fixtures and signs used in Tenant's business ("Tenant's Personal Property") shall at all
times remain Tenant's Personal Property, and may be removed from time to time by
Tenant or other occupants of the Premises; provided, however, that Tenant shall be
responsible for the cost of any physical damage to the Premises caused by the removal
of any such Personal Property, but not for any diminution in value of the Premises
caused by the absence of the Personal Property removed or by any necessity for
replacing such Personal Property. In no event shall Tenant make any changes,
modifications, alterations, or additions to the exterior of the Premises without Landlord's
specific written approval, notwithstanding any provision contained herein to the contrary.
Section 9. Si¢lnaqe. Tenant shall be allowed a cabinet sign three (3) feet high
by ten (10) feet wide, to be located on the building facade directly over the entrance
canopy. Sign construction shall be an extruded aluminum bleed face cabinet with
internal fluorescent illumination. Graphics shall be cut out of the aluminum face panel
and backed up with translucent acrylic. Landlord shall provide such signage at its
expense.
Section 10. Repairs and Maintenance
(a) Landlord, at Landlord's sole cost and expense, shall maintain, in
good condition, the structural parts of the Premises, which shall include, without
limitation, the foundations, bearing and extedor walls (excluding glass), subflooring,
floor slabs, roofs, the unexposed electrical, plumbing and sewerage system, as well as
the gutters and down spouts on the building. Landlord shall secure and maintain all
available building, construction and manufacturer's warranties on the construction
including, but not limited to, the electrical, plumbing, heating, ventilating and air
conditioning systems, and shall enforce the same for Tenant's benefit when so
requested. Landlord shall promptly correct and pay for all expenses associated with any
construction defects.
(b) Except as provided in Section 10(a) above or Sections 10(c) and
10(d) below, Tenant, at Tenant's sole cost and expense, shall maintain and repair the
non-structural interior portions of the Premises in good condition including, without
limitation, by maintaining and repairing all interior walls, storefronts, floors, ceilings,
interior and exterior doors, interior and exterior windows, and fixtures.
(c) Landlord shall deliver the Premises to Tenant with the parking area
in good condition, and Landlord shall perform all repairs necessary to maintain the
parking area in good condition including, but not limited to, filling holes and resealing as
necessary, but subject to normal wear and tear and damage by casualty or
condemnation. Regular, periodic maintenance of the lawns, landscaping and shrubbery
as well as snow and ice removal from all exterior areas shall be the responsibility of
Landlord. Tenant shall maintain the playground area and playground fencing at
Tenant's sole cost and expense.
(d) Landlord shall deliver the heating, ventilating and air-conditioning
system at the Premises in good working order. Thereafter, Tenant shall, at its sole cost,
maintain and make all minor repairs to the heating, ventilating and air-conditioning
system and other equipment that is affixed to the Premises, and shall purchase a
maintenance contract for same, providing for the periodic inspection and maintenance
of the system. In the event that any such system or equipment cannot be repaired and
must be totally replaced, or any repair costs in excess of FIVE HUNDRED DOLLARS
($500.00), then Landlord shall pay the costs of such major repair or replacement, unless
such repairs are necessitated by the negligence of Tenant. The systems shall keep the
Premises warm in the winter and cool in the summer consistent with a first-class office
building in the Iowa City, Iowa area.
(e) Upon expiration or termination of this Lease, Tenant shall surrender
the Premises to Landlord in the same condition as existed at the commencement of the
Term, except for reasonable wear and tear, condemnation, or for damage caused by
fire or other casualty. In no event shall Tenant be required to maintain or restore the
Premises to a condition greater than the condition of the Premises at the time Tenant
took occupancy.
Section 11. Liability of Parties. Unless specifically provided for elsewhere in this
Lease, Landlord shall not be liable for damages to Tenant's Personal Property on the
Premises or for injury to any person, unless such damage or injury is caused by
Landlord's failure to make repairs that Landlord is obligated to make or is caused by the
fault or negligence of Landlord, its agents, employees or persons acting in its behalf.
Unless specifically provided for elsewhere in this Lease, Tenant shall not be liable for
damage to the property of Landlord on the Premises or for injury to any person, unless
such damage or injury is caused by Tenant's failure to make repairs that Tenant is
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obligated to make or is caused by the fault or negligence of Tenant, its agents,
employees or persons acting in its behalf.
Section 12. Utilities and Janitorial. Landlord has previously installed all utilities
to the building on the Premises including meters. Tenant shall pay for all water, sewer,
gas, fuel, electricity, and all other utilities supplied to Tenant in the operation of its
business at the Premises during and allocable to the Term, except exterior lighting,
which will be provided by Landlord. Tenant shall pay for telephone service and regular
cleaning and janitorial services at the Premises.
Section 13. Inspection. Tenant shall allow Landlord access to the Premises
upon twenty-four (24) hours' prior notice to Tenant, at reasonable times during normal
working hours for the purposes of examining or exhibiting the Premises or making
repairs Landlord is required to make. Landlord shall use reasonable efforts not to
interfere with the operation of Tenant's business.
Section 14. Damaqe to or Destruction of Premises
(a) In the event of minor damage (costing less than $20,000.00 to
repair) to the Premises by fire or any other cause, which renders the Premises
untenantable in part by Tenant, and Tenant is able to conduct its business therein, and
Tenant continues to occupy such Premises in part, the Base Rent shall be apportioned
and reduced from the date the damage occurs in the proportion of the untenantable
building square footage of the Premises bears to the entire building square footage of
the Premises until the damage has been repaired. Landlord shall direct all repairs
through use of insurance proceeds.
(b) In the event of substantial damage, including destruction (costing
more than $20,000.00 to repair), to the Premises by fire or any other cause, which
renders the Premises untenantable in whole or in such part that Tenant cannot
practicably conduct its business therein in Tenant's reasonable judgment, the Rent shall
wholly abate from the date the damage occurs until the damage has been repaired.
Landlord shall direct all repairs through use of insurance proceeds.
(c) In the event of either minor or substantial damage, unless this
Lease is terminated as hereinafter provided in Paragraph 14(d) below, Landlord shall
commence within ten (10) days after the date the damage occurs to repair the Premises
to the same condition as existed immediately prior to such damage, and Landlord shall
complete such repair with due diligence and dispatch. If the damage is not repaired
within a reasonable time, or in any event within sixty (60) days from the date the
damage occurs in the case of minor damage and one hundred twenty (120) days from
the date the damage occurs in the case of substantial damage, Tenant shall have the
right to terminate this Lease by giving Landlord written notice within fifteen (15) days
after either such applicable time period. Upon such termination, any unearned Base
Rent or other payments paid in advance beyond the date of damage shall immediately
be refunded to Tenant.
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(d) In the event the damage to the Premises is by fire or by any other
cause and equals or exceeds fifty percent (50%) of the replacement value thereof as of
the date such damage occurs, either Tenant or Landlord may elect to terminate this
Lease by giving notice in writing of such election to the other party within ten (10) days
from the date the damage occurs; provided, however, that Tenant may nevertheless
continue the Lease by pre-exercising the Renewal Term or executing a Lease extension
so that an additional five (5) year term is effectuated following completion of repairs; and
provided, further, if the Premises are totally destroyed, this continuance shall not be
available to Tenant. Upon such termination, any unearned Base Rent or other payments
paid in advance beyond the date of damage shall immediately be refunded to Tenant.
(e) If Landlord and Tenant cannot agree whether the damage or
destruction of the Premises is "minor damage" or "substantial damage," or whether the
damage to the Premises equals or exceeds fifty percent (50%) of its replacement value,
then the parties agree to submit such disputed issue or issues to binding arbitration.
Within twenty (20) days of such damage or destruction, each party shall select an
arbitrator who is a duly licensed general contractor in the State of Iowa. If these
arbitrators are unable to agree upon the issues submitted to them within thirty (30) days
of their appointment, then they shall select a third arbitrator of like qualification, and the
decision of the third arbitrator shall be controlling. Each party to this Lease shall pay for
the services of its selected arbitrator, and the parties shall each pay one-half (½) of the
expense for services of the third arbitrator. The decision of the arbitrators in regard to
any issues submitted shall be final and binding upon the parties. Arbitration shall be
governed by the rules and regulations of the American Arbitration Association in effect
for the State of Iowa.
Section 15. Condemnation.
(a) If the whole or any substantial part of the Premises (more than
· twenty-five percent (25%) of the Premises or Premise's parking area) shall be taken or
condemned by any competent authority for any public use or purpose (or deed given in
lieu thereof), Landlord shall notify Tenant immediately, in writing, and Tenant may elect,
upon receipt of such notice, to terminate the Lease by providing written notice of such
election to Landlord. If Tenant does not provide written notice of such election to
Landlord within thirty (30) days of receipt of Landlord's notice, the Term of this Lease
shall end upon, and not before, the date when the possession of the part so taken shall
actually be required for such use or purpose or, in the alternative, the Premises shall be
reduced to eliminate any portion taken. Rent shall thereupon be apportioned as of the
date of such termination.
(b) If any par-[ of the Premises shall be taken or condemned, and
Tenant is able, in its sole judgment, to continue to operate its business on the Premises,
then this Lease shall continue in full force and effect, and the Base Rent due thereunder
shall abate proportionally to the extent that Tenant is deprived of usable area either in
the building or otherwise, and as of the date of such deprivation. If Tenant, in its sole
judgment, is not able to continue to operate its business on the Premises, Tenant may
elect to terminate this Lease upon written notice to Landlord. If Tenant does not elect to
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terminate the Lease under this Paragraph 15(b), Landlord shall, at Landlord's sole cost
and expense, restore the remaining portion of the Premises to the extent necessary to
render it reasonably suitable for the purposes for which it was leased, and shall make all
repairs to each building forming part of the Premises to the extent necessary to make
each building a complete and finished architectural unit of similar quality as prior to the
condemnation.
Section 16. Default. If a breach of any provision hereunder by either party
continues uncured or is not being diligently prosecuted at the end of thirty (30) days
after receipt of written notice from the other party stating with particularity the nature and
extent of the breach, the breach shall become a "Default" hereunder, and the party
giving such notice may terminate this Lease by written notice of termination; provided,
however, that such notice of termination shall not terminate this Lease if within thirty
(30) days after its receipt, the party in Default either (a) undertakes to correct such
Default, or (b) contests the existence of the Default in a court of competent jurisdiction,
and complies with the final order of any court in which the case is tried or the final order
of any court to which an appeal is taken within thirty (30) days after entry of final
judgment. Landlord and Tenant hereby agree that a Default so contested in good faith
shall not constitute an actual Default unless resolved as such. No delay or omission of
either party in exemising any right accruing upon any Default of the other party shall
impair such right to be construed to be a waiver thereof, and every such right may be
exemised at any time during the continuance of such Default. A waiver by either of the
parties of a breach or a Default under any of the terms and conditions of this Lease
shall be exclusive and shall not be deemed a waiver of any subsequent breach or
Default of the same or any other term, condition or covenant of this Lease. Upon the
occurrence of a Default by Tenant, Landlord, at its option, may at such times as it may
determine in its sole discretion, concurrently or successively, without being deemed to
have waived any rights or to have made an election in any circumstance, do any or all
of the following:
(a) Landlord may serve upon Tenant a notice that this Lease and the
then unexpired Term hereof shall terminate and become absolutely void on a date
specified in such notice, to be not less than thirty (30) days after the date of such notice.
On the expiration of the time limited in such notice, this Lease and the Term herein
granted, as well as all of the right, title and interest of the Tenant hereunder, shall,
except as to the rights and remedies of Landlord upon termination as provided herein,
terminate and become void in the same manner and with the same force and effect as if
the date fixed in such notice were the date originally specified for the expiration of the
Term herein demised. The Tenant shall then immediately quit and surrender to Landlord
the Premises, including any and all buildings and improvements thereon, but not
including Tenant's Personal Property, and Landlord may then, or at any time thereafter,
without judicial proceedings of any kind, enter into and repossess the Premises,
breaking open locked doors, if necessary, and may use such force as it may deem
necessary to effect such entrance and may remove all occupants and any property
thereon. Landlord may, but shall not be obligated to, obtain possession of the Premises
by forcible entry and detainer or any other judicial proceeding which it may, in its sole
discretion, institute for such purpose.
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(b) With or without re-entering and obtaining possession of the
Premises, Landlord may lease the Premises to any other person or entity, upon such
terms as the Landlord may deem reasonable, in its reasonable discretion, and for a
term within or beyond the Term of this Lease. Tenant shall be liable for any loss in Rent
through the date of such re-renting, together with expenses or costs incurred by the
Landlord in re-renting the Premises, for the payment of commissions, whether the
recovery of the Landlord shall be classed as rent or damage or otherwise, and Landlord
may recover such loss at any time, or from time to time, after any of the foregoing
events, whether prior to the end of the Term herein granted or otherwise.
(c) The parties hereto waive trial by jury in any action, proceeding or
counterclaim brought by either party against the other on all matters arising out of or in
any way connected with this Lease, the relationship of Landlord and Tenant, Tenant's
use or occupancy of the Premises, and any claim of injury or damage. Both parties shall
be obligated to mitigate damages in the event of Default.
(d) In the event of a breach or threatened breach by Tenant or
Landlord of any covenant or condition hereof, the aggrieved party shall have the right of
injunction to restrain the same and the right to invoke any remedy allowed by law or in
equity whether or not other remedies, indemnity or reimbursements are herein provided.
The various rights and remedies, powers, options and elections reserved, expressed or
contained in this Lease are distinct, separate and cumulative, and no one of the shall be
deemed to be exclusive of the other rights, remedies, powers or options provided
herein, or are not or may hereafter be conferred by statute or by state law.
(e) No such termination of this Lease, nor taking nor recovering
possession of the Premises with or without termination of this Lease, shall deprive
Landlord of any remedies or actions against Tenant for Rent or for damages due or to
become due for the breach of any covenant or condition herein contained, nor shall be
bringing of any such action for Rent, or breach of any covenant or condition, nor the
resort to any other remedy herein or otherwise provided for the recovery of Base Rent
or damage for such breach, be construed as a waiver of the right to insist upon the
forfeiture and to obtain possession in the manner herein provided.
(f) If Landlord defaults in the performance of any of its obligations
under this Lease, which default continues for a period of more than thirty (30) days after
receipt of written notice from Tenant specifying such default, or if such default is of a
nature to require more than thirty (30) days for remedy and continues beyond the time
reasonably necessary to cure (and Landlord has not undertaken procedures to cure the
default within such thirty (30) day period and diligently pursued such efforts to complete
such cure), Tenant may, at its option, in addition to any other remedy available at law or
in equity, terminate this Lease upon written notice to Landlord, or incur any expense
necessary to perform the obligation of Landlord specified in such notice and charge
Landlord for reasonable costs incurred in performing such obligation together with the
interest at the rate of ten percent (10%) per annum. In the event of non-payment for
thirty (30) days after written notice, Tenant shall have the right to set-off such amounts
due against the next ensuing payment(s) of Base Rent.
10
Section 17. Bankruptcy. In the event the leasehold estate created hereby shall
be taken in execution or by other process of law, or if Tenant shall be judged insolvent
or bankrupt pursuant to the provisions of any state or federal insolvency or bankruptcy
law, or if a receiver or trustee of the property of Tenant shall be appointed by reason of
Tenant's insolvency or inability to pay its debts, or if any assignment shall be made of
Tenant's property for the benefit of creditors, then and in any of such events, Landlord
may terminate this Lease by written notice to Tenant; provided, however, if the order of
court creating any such disabilities shall not be final by reason of pendency of such
proceedings, or appeal from such order, then Landlord shall not have the right to
terminate this Lease so long as Tenant performs its obligations hereunder.
Section 18. Environmental Representations and Indemnities. Tenant warrants,
represents and agrees that Tenant shall not, at any time during the Term or any
extension, use, store, treat, transport, manufacture, handle or produce any hazardous
material as defined by any federal, state or local law (whether gas, liquid or solid) at the
Premises, except to the extent such is part of Tenant's business (in which case Tenant
shall comply with all environmental laws with respect thereto), nor shall Tenant use or
occupy the Premises, or suffer the use and occupancy of the Premises, in violation of
any environmental laws. Tenant agrees to indemnify, defend (with counsel approved by
Landlord) and hold Landlord and its employees and agents harmless from any claims,
judgments, damages, penalties, fines, costs, liabilities (including sums paid in
settlement of claims) or loss, including attorney's fees, consultant's fees and expert's
fees (consultants and experts to be selected by Landlord) from or in connection with any
environmental condition at or affecting the Premises to the extent resulting from the acts
or misconduct of Tenant, its officers, directors, employees, agents or invitees. Without
limiting the generality of the foregoing, the indemnification provided by this Paragraph
18 shall specifically cover costs incurred in connection with any investigation of site
conditions or any clean-up, remedial, removal or restoration work required by any
federal, state or local government agency or political subdivision because of an
environmental condition that is a result of the acts or misconduct of Tenant, its officers,
directors, employees, agents or invitees. Landlord represents that it is unaware of any
environmental conditions at the Premises. In the event any such pre-existing
environmental conditions are later found to exist, then Tenant shall have the right to
terminate this Lease if it is unable to operate at the Premises, and in any event Landlord
agrees to indemnify, defend (with counsel approved by Tenant) and hold Tenant and its
agents and employees harmless from any claims, judgments, damages, penalties,
fines, costs, liabilities (including sums paid in settlement of claims) or loss, including
attorney's fees, consultant's fees and expert's fees (consultants and experts to be
selected by Tenant) from or in connection with any environmental condition at or
affecting the Premises to the extent resulting from a pre-existing condition or from the
acts or misconduct of Landlord, its officers, employees, managers, agents or invitees.
Without limiting the generality of the foregoing, the indemnification provided by this
Paragraph 15 shall specifically cover costs incurred in connection with any investigation
of site conditions or any clean-up, remedial, removal or restoration work required by any
federal, state or local government agency or political subdivision because of an
environmental condition which is the result of the acts or misconduct of Landlord, its
officers, managers, employees, agents or invitees.
11
Section 19. Insurance.
(a) Landlord will at all times during the Term of the Lease cause all
buildings, improvements and fixtures on the Premises to be insured against loss or
damage from fire or other peril in amounts not less than the replacement cost of all such
buildings, improvements and fixtures (excluding foundations below the ground,
excavation and grading) and for liability for bodily injury and property damage at the
Premises. Landlord and Tenant agree that the current replacement cost of Landlord's
building, improvements and fixtures on the Premises, for which Landlord shall carry the
insurance, is $409,000. The replacement value of the building shall remain at such level
throughout the Term and any Renewal Terms, but shall be increased if warranted based
on insurance market conditions, inflation or increases in the value of real estate in the
area.
(b) Landlord and Tenant shall each at all times during the Term of this
Lease cause to be maintained in force an insurance policy or policies covering bodily
injury and property damage liability resulting from injury occurring to persons in or about
the Premises, in an amount not less than TWO MILLION DOLLARS ($2,000,000)
combined single limit. Tenant shall at all times cause to be maintained in force an
insurance policy or policies covering its personal property in and about the Premises.
(c) Landlord shall be named as an additional insured on Tenant's said
policies and be provided with prior notice of any cancellation or termination of said
policies. Tenant shall provide a certificate of such insurance to Landlord annually upon
each renewal of its policy.
(d) All policies provided under this Paragraph 19 shall be issued by a
company or companies responsible and authorized to do business in the State of Iowa.
(e) Tenant and Landlord each hereby release and relieve the other,
and waive their right of recovery against the other and against the partners, directors,
officers, employees, agents and representatives of the other, for direct or consequential
loss or damage arising out of or incident to the perils covered by insurance carried by
such party, whether due to the negligence of Landlord or Tenant or their agents,
employees, contractors and/or invitees. All insurance policies required under this Lease
shall be endorsed to so provide.
Section 20. Mechanic's Liens. Tenant will not permit any mechanics' or material
men's or other liens to stand against the Premises for any labor or material furnished to
Tenant in connection with work of any character performed on the Premises. Landlord
will not permit any such liens for work or material furnished to Landlord to stand against
the Premises. Landlord and Tenant shall respectively have the right to contest the
validity or amount of any such lien, but upon the final determination of such questions
shall immediately pay any adverse judgment rendered with all proper costs and charges
and shall have the lien released at the contestant's own expense. If Landlord or Tenant
desires to contest any such lien, then prior to commencing such contest it will furnish
the other party with a bond, if requested, to secure the payment of such obligation.
12
Tenant shall have no authority to incur any indebtedness giving a right to any lien of any
kind upon Landlord's interest in the Premises.
Section 21. Assi~lnment or Subletting. Tenant may not assign this Lease or
sublet the Premises in whole or in part without the written consent of Landlord, which
consent shall not be unreasonably withheld, conditioned or delayed; provided, however,
that no written consent shall be required for an assignment or sublease by Tenant to an
entity which is an affiliated entity of Tenant or an entity which acquires all of the assets
or stock of Tenant. Tenant shall remain liable for the performance of all obligations set
forth in this Lease following any permitted assignment or sublease.
Section 22. Renewal Term.
(a) If Tenant is not otherwise in Default beyond the applicable cure
periods as defined in Section 16 of this Lease, Tenant shall have the right to extend the
Term of this Lease, on the same terms, conditions and covenants as are contained
herein, except as specifically set forth herein, upon giving Landlord written notice not
less than ninety (90) days prior to the expiration date of the initial Term or Renewal
Term, as applicable, for two (2) additional periods of five (5) years each (the "Renewal
Term" or "Renewal Terms"). The Renewal Terms, if exercised, shall commence
immediately upon the expiration of the original Term or Renewal Terms, as applicable.
(b) If Tenant exercises its right to extend the Lease for additional
renewal terms as set forth in Section 22(a) herein, Base Rent shall be increased for
each such Renewal Term by ten (10) percent over the rent amount due for the last year
of the previous Term. Rent owed during the Renewal Term shall be payable in the same
manner as required during the initial Term. Failure by Tenant to timely exercise a
Renewal Term shall terminate Tenant's rights to exercise any Renewal Term, time
being of the essence. If Tenant fails to timely exercise any Renewal Term, then
Landlord shall have the right to display "For Rent" or "For Sale" or similar signage at the
Premises (including affixing such signage on the building or windows thereof as
Landlord may determine) during the final ninety (90) days of the Term or the Renewal
Term. As used herein, the word "Term" may refer to the initial Term of five (5) years and
any properly exercised Renewal Term, as the context shall require.
Section 23. Holdover. Any holding over after the expiration of the Term, with the
consent of Landlord, shall be construed to be a tenancy from month-to-month at the
monthly Base Rent paid during the last month of the Term, and shall otherwise be on
the terms and conditions herein specified, so far as applicable.
Section 24. Notices. All notices, approvals or requests in connection with this
Lease shall be sent by certified mail, return receipt requested, or by a nationally
recognized overnight delivery service, except notices concerning repairs and
replacements which may be given orally, and Base Rent may be sent by US Mail, or by
any other means which might reasonably be expected to give the other party notice;
13
provided, however, that no notice other than by certified mail or overnight delivery shall
constitute a notice of Default authorizing termination of this Lease.
If to Landlord: City of Iowa City.
ATTN: Parking Manager
410 E. Washington St., Iowa City, IA 52240
Telephone: (319) 356-5094
Facsimile: (319) 356-5009
If to Tenant: Bradford Child Care Services, Inc.
A'I-I'N: Mr. Frank Reabe, CEO
2281 McKees Rocks Road
McKees Rocks, PA 15136
Telephone: (412) 787-3080
Facsimile: (412) 787-3844
Section 25. Waiver. Failure or delay on the part of Landlord or Tenant to
exercise any right, remedy, power or privilege hereunder shall not operate as a waiver
thereof. A waiver, to be effective, must be in writing and must be signed by the party
making the waiver. A written waiver of a Default shall not operate as a waiver of any
other Default or of the same type of Default on a future occasion.
Section 26. Amendments. No revision or amendment of this Lease shall be
valid unless made in writing and signed by duly authorized representatives of both
parties.
Section 27. Benefits. This Lease shall be binding upon and inure to the benefit
of the successors and assigns (if assignment is permitted) of each of the parties hereto.
Section 28. Quiet Enjoyment. Landlord will warrant and defend Tenant in the
quiet and peaceful enjoyment and possession of the Premises during the Term hereof
and the Renewal Term without any interruption by Landlord or any person.
Section 29. Right of First Offer. In the event any space on the same floor of the
building becomes available during the Term of this lease, except such space intended
for or leased for a bus or transit station, and the Renewal Term if applicable, Landlord
shall first offer the space in writing to the Tenant upon the same rental terms Landlord is
willing to lease such space to a third party. Tenant shall then have ten (10) business
days to accept or reject Landlord's offer or to negotiate and sign an agreement
acceptable to both parties. Upon Tenant's acceptance of the offer, this Lease shall be
amended to incorporate the additional space and rental terms. If Tenant rejects such
offer or does not respond within ten (10) days, then Landlord shall have the right to
lease such space until the space again becomes available, at which time this right of
first offer shall apply.
14
Section 30. Attorney's Fees. Except as provided in Paragraph 14(e), in the
event of a dispute arising out of, related to, or incidental to the relationship established
between Landlord and Tenant in connection with this Lease, the reasonable and actual
attorney fees of the prevailing party shall be paid by the non-prevailing party; provided,
however, that the attorney's fees shall be owed only following a court or arbitration
proceeding and then only in such sums as the court or arbitrator(s) shall award.
Section 31. Entire Aqreement. This Lease sets forth the entire agreement
between Landlord and Tenant relative to the Premises, and there are no promises,
agreements, conditions or understandings, either oral or written, expressed or implied,
between them other than herein set forth.
Section 32. Subordination. This lease is subject and shall be subordinate at all
times to the lien of existing and future mortgages on the Premises. Although no
instrument or act by Tenant shall be necessary to effectuate such subordination, Tenant
shall, nevertheless, execute and deliver such further instruments subordinating this
Lease to the lien of all such mortgages as Landlord may from time to time request. So
long as Tenant is not in default in the payment of Rent or in the performance of any
term or condition of this Lease, Tenant's possession of the Premises and its rights and
privileges under this Lease shall not be diminished or interfered with by any mortgagee.
Any such mortgagee shall provide a written non-disturbance agreement reasonably
acceptable to the parties.
Section 33. Existinq Mortgage. Landlord represents and warrants to Tenant that
the execution of this Lease by Landlord does not require the consent of any third party,
including Landlord's lender at the Premises. Landlord shall provide a non-disturbance
agreement from the holder of any mortgage or deed of trust on the Premises, in form
and content reasonably acceptable to Tenant, no later than thirty (30) days following the
execution of this Lease. In the event such agreement has not been provided within such
time period, Tenant shall have the right to terminate this Lease by written notice
delivered to Landlord, or may pay Base Rent at fifty percent (50%) of the regular rate
until such non-disturbance agreement is provided.
Section 34. Applicable Law. This Lease, and the rights and obligations of the
parties hereto, shall be construed and enforced in accordance with the laws of the State
of Iowa without reference to the choice of law provisions thereof.
Section 35. Severability. The invalidity of any provision of this Lease as
determined by a court of competent jurisdiction shall in no way affect the validity of any
other provision hereof.
Section 36. Brokeraqe. Each party to this Lease hereby warrants to the other
that it has had no dealings with any broker or agent in connection with this Lease. Each
party to this Lease covenants to pay, hold harmless and indemnify the other party from
and against any and all costs (including reasonable attorneys' fees), expense or liability
for any compensation, commissions and charges claimed by any broker or other agent
with respect to this Lease or the negotiation thereof on behalf of such party.
15
Section 37. Time of Essence. Time is of the essence with respect to the
obligations to be performed by the parties to this Lease.
Section 38. Arbitration. The arbitration provided for herein shall be conducted
pursuant to the rules and regulations of the American Arbitration Association in effect for
the State of Iowa. Unless otherwise provided, each party shall select an arbitrator within
ten (10) days after one party's written notification to the other party of its intent to submit
the matter to arbitration. If said arbitrators are unable to agree upon the issues
submitted to them within ten (10) days of their appointment, then they shall select a third
arbitrator, and the decision of the third arbitrator shall be final, controlling and binding.
Each party shall pay for the services of its selected arbitrator, and the parties shall each
pay one-half (½) of the expense for services of the third arbitrator. The arbitrator or
arbitrators may, but need not, award reasonable attorneys' fees to the prevailing party.
The decision of the arbitrator(s) in regard to any issues submitted shall be final and
binding upon the parties and enforceable by any court of competent jurisdiction. All
arbitration proceedings shall be conducted in Johnson County, Iowa.
Section 39. Exclusivity. Landlord hereby grants to Tenant the exclusive right to
operate a child care facility and/or to offer early education services at the property
described on Exhibit A (the "Property"). Landlord agrees that it will not lease or sell
property owned by it to any other person, company or entity engaged in similar child
care services or early education services within the Court Street Transportation Center
or within a one (1) mile radius of the Property (the "Restricted Area"). Landlord shall not
lease or permit any other person or entity to operate at the Property or within the
Restricted Area in violation of Tenant's exclusive use right. In the event of a violation by
Landlord of the exclusive use right, Tenant's Rent shall be reduced to twenty-five
percent (25%) of the Base Rent required by this Lease until such violation is corrected.
Section 40 . Parkinq. Landlord shall designate up to five (5) parking spaces
immediately in front of, or adjacent to, Tenant's entrance door as short-term parking, to
assist in the drop-off and pick-up of children.
16
IN WITNESS WHEREOF, the parties have executed this Lease on the date first
written above with the intent to be legally bound hereby.
WITNESS
Name
Its:
~p~d By
Federal ID
Telephone:
TENANT:
By:BRAD FORD CHILD ' ~~'~' ~'/CARE SE RVI CES, I NC.
Name: Frank D. Reabe
Its: CEO
Federal ID No.: 25-1752692
Telephone: (412} 787-3080
17
EXHIBITS
Exhibit A - Legal Description
Exhibit B - Site Plan
EXHIBIT A
LEGAL DESCRIPTION
APPLETREE CHILD CARE CENTER
COURT STREET TRANSPORTATION CENTER
IOWA CITY, IOWA
Legal Description
The northerly 133'-$½' of Building Shell Space No. 105 located on the first floor of the Court
Street Transportation Center of the City of Iowa City. Said area contains 8,083 square feet (SF)
of interior shell space and an adjacent outdoor play area encompassing 2,733 square feet (SF).
Said building shell space areas calculated may b¢ subject to minor square footage loss for
columns and/or other structural £caturcs.
See attached Exhibit A drawing of Appletree Child Care Center.
EXHIBIT B
Site Plan
EXHIBIT B
Floor Plan
Date: July 7, 2004
To: City Council
From: Jeff Davidson, Assistant Director, Dept. of Planning and Comj~unity Development
Joe Fowler, Director, Depadment of Parking and Transit--"~
Re.' June 14 special City Council meeting
It is with great pleasure at your June 14 meeting that we present to you the proposed lease of
space in the Court Street Transportation Center to Bradford Childcare Services for operation of
an Apple Tree Children's Center. This City Council meeting will also serve as an oppodunity for
the principals of Bradford Childcare Services to be introduced to you and the community. A
downtown childcare center has been one of our top priorities for the transportation center since
the earliest planning stages. In spite of the fact that Iowa City's main employment center is
located downtown, childcare centers have been unable to locate in downtown Iowa City
because of the high cost of property in the downtown market. This has made it difficult for
persons to take children to childcare using Iowa City Transit. The partnership between the City
of Iowa City and Bradford Childcare Services will allow the establishment of a downtown
childcare center for approximately 100 children ages infant through 6, beginning in summer
2005.
The process of locating a childcare center operator to work with us was more difficult than we
had anticipated. Our initial request for proposals resulted in three providers expressing interest.
Our initial choice was a national franchise firm who later withdrew due to a national downturn in
their business. Our second prospect was a local childcare provider who after negotiating with us
decided to remodel an existing building in Iowa City. A University of Iowa childcare center also
expressed interest in relocating from their existing facilities, but eventually decided not to.
In our second call for proposals we were contacted by Bradford Childcare Services, which is a
non-profit corporation. Bradford operates 30 childcare centers and early education programs in
three states, including eight Apple Tree Children's Centers in the Des Moines area.
Approximately 60% of Bradford's childcare centers have achieved National Association for the
Education of Young Children (NAEYC) accreditation, and their remaining centers are in the
process of achieving this distinction as well. This accreditation is above and beyond the required
state licensing procedures. In 2004 eight Bradford teachers, including three Iowa Appletree
Teachers, received National Child Care Teacher of the Year awards from the Terri Lynne L0k0ff
Foundation. Over the past three years, out of 150 teachers nationwide who have received this
prestigious award, 15 were teachers at Bradford schools.
Bradford is committed to participate fully in all childcare subsidy programs, including the
Department of Human Services Childcare Assistance program in Iowa. This will result in our
downtown childcare center serving children and families of all economic backgrounds. School
hours will be 6:30 a.m. to 6:00 p.m., Monday through Friday. Tuition prices and further program
information will be announced at a later date.
July 7, 2004
Page 2
The proposed lease for your consideration on July 14 calls for the City to construct the childcare
center, which will then be leased to Bradford Childcare Services. The construction of the shell
space for the facility is being conducted as part of the federally funded portion of the
transportation center project. The fit-out of the childcare center according to Bradford's
requirements is being funded 100% by the City, and will be reimbursed by Bradford through
their lease payments. There is an initial five-year lease period with two five-year renewal
periods.
According to federal regulations, the annual net revenue stream from the childcare center after
expenses must be pledged to the operating or capital expenses of Iowa City Transit. This
arrangement will also apply to the Greyhound Bus Station and the two smaller leased spaces
within the Court St. Transportation Center. We have structured the childcare center lease at
Bradford's request so that lease payments are minimized in the initial year while Bradford builds
its initial census of children, and increases in year two when the center will be operating at
capacity.
Bring any comments or questions to the July 14 special meeting and join us in welcoming
Bradford Childcare Services CEO Frank Reabe and his staff to Iowa City. For more information
regarding Apple Tree Children's Center and Bradford Child Care Services, contact Leann Andre
at 515/270-0569, or visit their website at www.earlyeducationpros.or.q.
cc: Steve Atkins
Linda Severson
Karin Franklin
ppdadm/mem/jd-brad ford ,doc