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Case 3:15-cv-00749-BR

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Randolph C. Foster, OSB No. 784340


randy.foster@stoel.com
Edward A. Piper, OSB No. 141609
ed.piper@stoel.com
STOEL RIVES LLP
900 SW Fifth Avenue, Suite 2600
Portland, OR 97204
Telephone: (503) 224-3380
Facsimile: (503) 220-2480
Attorneys for Defendant
C.E. John Properties 65, LLC

UNITED STATES DISTRICT COURT


DISTRICT OF OREGON
PORTLAND DIVISION

TUATARA ENTERPRISES, INC., dba


BESAW'S, an Oregon corporation,
Plaintiff,

Case No.: 3:15-cv-00749-BR


C.E. JOHN PROPERTIES 65, LLC'S
ANSWER, DEFENSES AND
COUNTERCLAIMS

v.
C.E. JOHN PROPERTIES 65, LLC, an
Oregon limited liability company,
Defendant.
ANSWER
For its answer to the allegations in Plaintiff's Complaint, C.E. John Properties 65, LLC
("C.E. John") admits, denies and alleges as set out below. Unless otherwise indicated, the
numbered paragraphs 1-55 of this Answer respond to the corresponding numbered paragraphs of
Plaintiff's Complaint, e.g., Answer paragraph 1 responds to Complaint paragraph 1.
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Admits that there is a justiciable controversy existing between the parties as more

1.

particularly alleged in C.E. John's First Counterclaim and denies the balance of the allegations in
paragraph 1 of Plaintiff's Complaint.
Admits that there is a justiciable controversy existing between the parties as more

2.

particularly alleged in C.E. John's First Counterclaim and that the controversy involves
Plaintiff's threat to operate a restaurant under the Besaw's name following termination of the
current Lease Agreement between the parties in violation of the Lease Agreement's provisions
governing continued use of the Besaw's name, and denies the balance of the allegations in
paragraph 2 of Plaintiffs Complaint.
Admits that there is a justiciable controversy existing between the parties as to

3.

their respective rights in the use of the Besaw's name upon termination of the Lease Agreement
as more particularly alleged in C.E. John's First Counterclaim, and denies the balance of the
allegations in paragraph 3 of Plaintiffs Complaint.
4.

Denies the allegations in paragraph 4 of Plaintiffs Complaint.

5.

Admits that if the Court has subject matter jurisdiction under the Lanham Act,

then venue is proper in this district as alleged in paragraph 5 of Plaintiffs Complaint.


Admits that this Court has personal jurisdiction over C.E. John as alleged in

6.

paragraph 6 of Plaintiffs Complaint.


Admits that Plaintiff is an Oregon corporation with its principal place of business

7.
in Oregon.

Admits that C.E. John is an Oregon limited liability company with its

8.

headquarters in the state of Washington.

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Admits that various persons and entities have operated the restaurant facilities at

9.

the Besaw's building location (2301 NW Savier Street, Portland, Oregon) (the "Besaw's
building"); admits that any restaurant that has been operated at the Besaw's building over the last
100 years has been called or known as "Besaw's" or "Besaw's Caf"; admits that there have
been periods of time when the restaurant facilities were not being operated at the Besaw's
building; and alleges that any lessee/operator of the restaurant at the Besaw's building only used
the name "Besaw's" with permission of the building/restaurant owner independent of the
Besaw's building's owner and only for the term of the governing lease. Except as admitted
above, C.E. John denies the balance of the allegations in paragraph 9 of Plaintiff's Complaint.
10.

C.E. John is without sufficient information to admit or deny the allegations in

paragraph 10 regarding the alleged purchase of a restaurant by Besaw's Caf, Inc. ("BCI"), but
admits that a partnership called Jones Group Associates ("JGA") owned the Besaw's building
prior to selling the building to C.E. John in 2011, and that prior to C.E. John's acquisition of the
Besaw's building, JGA entered into a Lease Agreement with BCI under which BCI was
authorized to operate the restaurant at the building and to use the Besaw's name for the
restaurant operations as permitted by the Lease Agreement. A true copy of the JGA/BCI Lease
Agreement that was assumed by C.E. John as part of the 2011 acquisition of the Besaw's
building (the "Lease Agreement") is attached to this Answer as Exhibit 1. The Lease
Agreement includes a pre-printed form, an addendum, a guarantee from the owners of BCI and a
memorandum extending the lease term. Except as admitted above, C.E. John denies the balance
of the allegations in paragraph 10 of Plaintiffs Complaint.
11.

Admits that BCI and JGA executed the March 20, 2005 Lease Agreement and

admits that the Lease Agreement contains provisions governing the tenant's use of the Besaw's
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name (and any variation) during and after the term of the Lease Agreement. Specifically,
paragraph 27 of the Lease Agreement, titled "Name," provides:
It is hereby agreed that the name "Besaw's" or "Besaw's Caf" or
any variation of the name "Besaw's" shall at all times be and
remain the sole and exclusive property of lessor. Lessor grants to
lessee the right to use the name "Besaw's Caf" at the location
known as 2301 NW Savier St, solely in conjunction with lessee's
restaurant at that address, for the term of the lease, as extended,
and not otherwise. The name may be used in all normal activities
associated with the operation of the proposed restaurant as an
allowed use under the terms of the lease and any extensions
thereof; however, the right to use the name shall terminate with the
termination of the lease.
Paragraph 32.3 of the Lease Agreement, titled "Trade Name," also addresses use of the Besaw's
name and provides:
In addition to the provisions of paragraph 27, [I]essee agrees upon
termination of lease that the trade name "Besaw's" or "Besaw's
Caf" or any variation of the name Besaw's shall revert to lessor
and that lessee will discontinue to use trade name "Besaw's" or
"Besaw's Caf" or any variation of "Besaw's" and will execute
any documents to transfer trade name to lessor including
"Besaw's" or "Besaw's Caf" or any variation thereof. Lessee
further agrees to change its corporate name to a name other than
"Besaw's["] or "Besaw's Caf, Inc." or any variation thereof upon
termination of the lease or in the event that [I]essee is no longer
leasing the above described premises.
Except as admitted above, denies the allegations in paragraph 11 of Plaintiff's Complaint.
12.

Denies the allegations in paragraph 12 of Plaintiff's Complaint. While JGA did

not employ persons to run the restaurant facilities that it had invested in remodeling and restoring
when it acquired the building in the early 1990s, the various lessee/operators were approved by
JGA.

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13.

Denies the allegations in paragraph 13 of Plaintiff's Complaint.

14.

Denies the allegations in paragraph 14 of Plaintiff's Complaint.

15.

Denies the allegations in paragraph 15 of Plaintiff's Complaint.

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C.E. John is without sufficient knowledge or information to admit or deny the

allegations in paragraph 16 of Plaintiffs Complaint, but admits that Plaintiff succeeded to BCI's
operation of the restaurant at the Besaw's building, that around June 2005 BCI assigned the
Lease Agreement to Plaintiff, and that Plaintiff accepted the assignment of the rights and
obligations under the Lease Agreement. Except as admitted above, C.E. John denies the balance
of the allegations in paragraph 16 of Plaintiffs Complaint.
17.

Admits that through three documents each titled "Assignment and Assumption of

Lease," and each effective June 23, 2005, BCI assigned its rights and obligations as lessee under
the Lease Agreement and related lease agreements to Plaintiff. The assignment agreements
between BCI and Plaintiff each governed different aspects of the Besaw's buildingthe
restaurant facilities, the patio and the parking lot. The assignment governing the restaurant
portion of the leased property (the "2005 Restaurant Assignment") and the Lease Agreement,
together with JGA's consent to that assignment, are attached as Exhibit 2. Sections 7.4-7.6 of
the 2005 Restaurant Assignment between BCI and Plaintiff state:
7.4.

Assigning party [BCI] shall discontinue use of the trade


name, Besaw's or Besaw's Caf, to assuming party and
assigning party will notify assuming party and Landlord of
its new corporate name.

7.5

The trade name "Besaw's" or Besaw's Caf or variation


thereof shall remain the property of [JGA] pursuant to
paragraph 27 of the lease.

7.6

[Plaintiff] shall be allowed to use the trade name as long as


it leases the above-described premises.

Except as admitted above, denies the balance of the allegations in paragraph 17 of Plaintiff s
Complaint.
18.

C.E. John is without information sufficient to admit or deny when Plaintiff began

operating the restaurant at the Besaw's building, but admits that it happened sometime in 2005.
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19.

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Admits that JGA continued as the owner and landlord of the Besaw's building

and restaurant facilities until JGA sold the property to C.E. John in 2011, and denies the balance
of the allegations in paragraph 19 of Plaintiff's Complaint.
20.

Admits the allegations in paragraph 20 of Plaintiff's Complaint and states further

that the deed was in furtherance of a transaction evidenced by a Purchase and Sale Agreement
dated February 11, 2011, as amended (the "2011 Sale Agreement"). Through the 2011 Sale
Agreement, C.E. John purchased the Besaw's building, all rights in the Besaw's name and other
property from JGA, and succeeded to all of JGA's rights under the Lease Agreement. The actual
execution of the 2011 Sale Agreement took place on or about November 16, 2011.
21.

Admits that as part of the transaction evidenced by the 2011 Sale Agreement, C.E.

John assumed the Lease Agreement. A copy of the 2011 Lease Assumption agreement is
attached as Exhibit 3. The 2011 Lease Assumption provides, in part:
Assignment. On and as of the Effective Date, Assignor
1.
[JGA] hereby assigns, transfers and conveys to Assignee [C.E.
John] all of Assignor's rights and interests as lessor in, to and
under leases of the Property, including without limitation and
without warranty and indemnification all of Assignor's rights in
and to the trade names of "Besaw's" and "Besaw's Caf" under the
lease between Assignor and Tuatara Enterprises, Inc. Assignor
further quitclaims and assigns to Assignee any rights Assignor may
otherwise have in and to such trade names.
Through Exhibit 3 and the 2011 Sale Agreement, C.E. John became the landlord under the Lease
Agreement with Plaintiff.
22.

Denies the allegations in paragraph 22 of Plaintiff's Complaint.

23.

C.E. John is without sufficient information to admit or deny the allegations in

paragraph 23 of Plaintiff's Complaint, but admits that Plaintiff currently provides breakfast,
lunch and dinner service and further admits that the name "Besaw's" is well-known in the
Portland area and is associated with the building at 2301 NW Savier Street and that restaurant
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operations have been conducted there for over 100 years exclusively under the Besaw's name.
C.E. John is the current owner of the Besaw's building, Besaw's restaurant facilities, the
Besaw's name used in connection with that property and the rights retained under the Lease
Agreement regarding use of the Besaw's name upon termination of Plaintiff's operation of the
Besaw's restaurant facilities on May 31, 2015.
24.

C.E. John denies the allegations in paragraph 24 of Plaintiff's Complaint but

admits that the name "Besaw's" is well-known in the Portland area and has been associated with
the building and restaurant located at 2301 NW Savier Street for over 100 years.
25.

Admits that the Lease Agreement expires on May 31, 2015 and denies the balance

of the allegations in paragraph 25 of Plaintiffs Complaint.


26.

Admits that C.E. John intends to continue to cause the restaurant at the Besaw's

building to be operated under the Besaw's name by a tenant/operator, and denies the balance of
the allegations in paragraph 26 of Plaintiffs Complaint.
27.

Admits the allegations contained in the first sentence of paragraph 27 of

Plaintiffs Complaint; admits that C.E. John advised the U.S. Patent and Trademark Office that
the Besaw's mark had been used in commerce since 1903 by C.E. John or its predecessors in
interest (or their authorized tenant operators); admits that C.E. John provided the U.S. Patent and
Trademark Office with a copy of the menu from the restaurant being operated subject to the
Lease Agreement; and, based on information and belief, admits that the menu was developed for
use by Plaintiff. Except as admitted above, C.E. John denies the remaining allegations in
paragraph 27 of Plaintiffs Complaint.
28.

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Admits the allegations in paragraph 28 of Plaintiffs Complaint.

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Admits that Plaintiff sent a letter to C.E. John on or about March 20, 2015

demanding that C.E. John withdraw its federal trademark application for "Besaw's." Except as
admitted above, C.E. John denies the remaining allegations in paragraph 29 of Plaintiff's
Complaint.
30.

Admits that C.E. John responded to Plaintiff's March 20 demand letter, and that

C.E John rejected Plaintiff's demand and reminded Plaintiff of C.E. John's rights and Plaintiff's
obligations under the Lease Agreement, including the obligation that Plaintiff cease use of the
names "Besaw's" or "Besaw's Caf" at the termination of the Lease Agreement on May 31,
2015 and that any and all rights that Plaintiff had in the name will be transferred to C.E. John at
that time. Except as admitted above, denies the remaining allegations in paragraph 30 of
Plaintiff's Complaint.
31.

Admits the allegations in paragraph 31 of Plaintiff's Complaint.

32.

Based on Plaintiff's public announcements about its future business plans, which

appear in part to be designed to gain free advertising for Plaintiff's new restaurant while also
and animosity directed toward C.E. John and any future operator of the

creating

restaurant at the Besaw's building, admits the allegations of paragraph 32 of Plaintiff's


Complaint.
33.

Admits that there exists an actual controversy between the parties concerning

their respective rights to use the Besaw's name upon termination of the Lease Agreement
effective May 31, 2015, but denies that an adjudication of trademark rights is necessary to
resolve the dispute as suggested by the allegations in paragraph 33 of Plaintiff's Complaint. The
Lease Agreement provides that Plaintiff must cease use of "Besaw's" upon termination of the
Lease Agreement and transfer to C.E. John any and all rights (including trademark rights) that
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Plaintiff may have to "Besaw's," "Besaw's Caf" or any variation. The enforcement of these
contract obligations will render Plaintiff's trademark claims moot and Plaintiff will lack
standing.
34.

C.E. John is without sufficient knowledge to admit or deny the allegations in

paragraph 34 of Plaintiff's Complaint, but admits that the parties' dispute over their respective
rights and obligations under the Lease Agreement is ripe for adjudication and that Plaintiff is
actively planning to breach its obligations under the Lease Agreement by opening and operating
in close proximity to the Besaw's building a restaurant that Plaintiff intends to call "Besaw's."
35.

Denies the allegations in paragraph 35 of Plaintiff's Complaint.

36.

Admits that there is an actual and justiciable controversy between the parties

regarding their respective rights and obligations under the Lease Agreement regarding use of the
Besaw's name following expiration of the Lease Agreement on May 31, 2015, and otherwise
denies the allegations in paragraph 36 of Plaintiffs Complaint.
37.

Paragraph 37 of Plaintiff's Complaint incorporates the allegations in paragraphs

1-36 of the Complaint. In response, C.E. John realleges the admissions, denials and allegations
of paragraphs 1-36 of this Answer.
38.

Admits that C.E. John advised Plaintiff that Plaintiff's continued use of the

Besaw's name following expiration of the Lease Agreement will violate C.E. John's legal rights
under the Lease Agreement and otherwise, and admits that C.E. John advised Plaintiff that C.E.
John would reluctantly seek the assistance of the courts if Plaintiff failed to honor its obligations
under the Lease Agreement regarding use of the Besaw's name and the transfer to C.E. John of
any and all rights Plaintiff may have or claim in the name at the time of termination. Except as
admitted above, denies the allegations in paragraph 38 of Plaintiff's Complaint.
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39.

Denies the allegations in paragraph 39 of Plaintiff's Complaint.

40.

Denies the allegations in paragraph 40 of Plaintiff's Complaint.

41.

Denies the allegations in paragraph 41 of Plaintiff's Complaint.

42.

Denies the allegations in paragraph 42 of Plaintiff's Complaint.

43.

Denies the allegations in paragraph 43 of Plaintiff's Complaint.

44.

Denies the allegations in paragraph 44 of Plaintiff's Complaint.

45.

Denies the allegations in paragraph 45 of Plaintiff's Complaint.

46.

Denies the allegations in paragraph 46 of Plaintiff's Complaint.

47.

Denies the allegations in paragraph 47 of Plaintiff's Complaint.

48.

Denies the allegations in paragraph 48 of Plaintiff's Complaint.

49.

Paragraph 49 of Plaintiff's Complaint incorporates the allegations in paragraphs

1-37 and 39-45 of the Complaint. In response, C.E. John realleges the admissions, denials and
allegations in this Answer corresponding to those numbered paragraphs of the Complaint.
50.

Admits that C.E. John intends to continue restaurant and food service operations

at the Besaw's building and associated property through a lease or other operating agreement that
permits the tenant operator to use the Besaw's name only during the term of the lease, that
ensures ultimate rights to use of the Besaw's name remain with C.E. John, and that requires the
tenant to assign to C.E. John upon termination of the lease any rights the tenant may acquire or
claim in the Besaw's name during the term of the lease.
51.

Denies the allegations in paragraph 51 of Plaintiff's Complaint.

52.

Admits the allegations in paragraph 52 of Plaintiff's Complaint.

53.

Denies the allegations in paragraph 53 of Plaintiff's Complaint.

54.

Denies the allegations in paragraph 54 of Plaintiff's Complaint.

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Denies the allegations in paragraph 55 of Plaintiff's Complaint. Except as

expressly admitted above, denies each and every other allegation in Plaintiff's Complaint.
Without assuming Plaintiffs burden of pleading or proof as to any claim or issue for
which Plaintiff has such burden as a matter of law or procedure, C.E. John asserts the following
defenses and counterclaims:
FIRST DEFENSE
(Noninfringement/Standing)
56.

C.E. John has not infringed, contributed to the infringement of or actively induced

others to infringe upon any trademark or other interest that Plaintiff has or may have in
"Besaw's" or any variation. Rather, as alleged above, as between Plaintiff and C.E. John, C.E.
John enjoys the exclusive right to use the name Besaw's or any variation. To the extent Plaintiff
has or claims any right to use of "Besaw's" or any variation, Plaintiff is prohibited upon
termination of the Lease Agreement from using the Besaw's name or logo (or any variation) for
any purpose and, at that time, is required to transfer to C.E. John any and all rights Plaintiff may
have in the name, logo or any variation.
SECOND DEFENSE
(Estoppel)
57.

In an estoppel certificate dated June 16, 2011 that it executed and delivered to

C.E. John (the "Estoppel Certificate"), Plaintiff affirmed and represented to C.E. John that the
Lease Agreement was in full force and effect and had not been modified, changed, altered or
amended in any respect; that the landlord had not waived any right granted in the Lease
Agreement; that tenant had no existing defenses against the landlord's enforcement of the Lease
Agreement; and that the Estoppel Certificate was given with the understanding that C.E. John
would rely on the truth of the matters stated in the Estoppel Certificate in connection with the
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transaction between the landlord (JGA) and C.E. John. A copy of the Estoppel Certificate is
attached as Exhibit 4.
58.

C.E. John reasonably relied on the representations of Plaintiff in the Estoppel

Certificate in proceeding with the acquisition of the Besaw's building and restaurant and
assuming the rights and obligations of JGA in the Lease Agreement.
59.

Plaintiff should be estopped from denying its obligations upon termination of the

Lease Agreement to (i) cease use of the Besaw's name or any variation upon termination of the
Lease Agreement and (ii) transfer to C.E. John any and all rights that Plaintiff may have or claim
in the Besaw's name or any variation.
FIRST COUNTERCLAIM AND THIRD DEFENSE
(Breach of Contract)
60.

C.E. John incorporates and realleges its admissions, denials and allegations in

paragraphs 1-59 as though fully set forth herein.


61.

This Court has subject matter jurisdiction over this First Counterclaim under 28

U.S.C. 1367, because it arises out of the same property, agreements, and other transactions and
occurrences that are the subject matter of Plaintiff's Complaint, and is so related to Plaintiff s
claims that it forms part of the same case or controversy.
62.

Venue in this judicial district is proper under 28 U.S.C. 1391(b)(1) because

Plaintiff is an Oregon corporation with its principal place of business in Oregon.


63.

The Lease Agreement originally entered into by BCI and JGA is a valid and

enforceable contract.
64.

Through the 2005 Restaurant Assignment and other associated transaction

documents regarding the Besaw's building and related property, all of which became effective on
June 23, 2005, Plaintiff assumed all of BCI's rights and duties under the Lease Agreement,
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including, but not limited to, those rights and obligations related to use of the Besaw's name
during and after the term of the Lease Agreement.
65.

When it assumed the rights and obligations under the Lease Agreement from BCI,

Plaintiff reaffirmed the provisions of the Lease Agreement providing that JGA remained the sole
owner of all right, title and interest in the Besaw's name. As more specifically alleged in
paragraph 17 of this Answer, sections 7.4-7.6 of the 2005 Restaurant Assignment reaffirmed that
Tuatara Enterprises, Inc. was only permitted to use the Besaw's name (or any variation) during
the term of the Lease Agreement.
66.

Through the 2011 Sale Agreement transaction, C.E. John fully assumed all of

JGA's rights and duties under the Lease Agreement, including, but not limited to, those rights
and obligations related to the use of "Besaw's."
67.

Additionally, in connection with the 2011 Sale Agreement, Plaintiff provided

JGA and C.E. John with the Estoppel Certificate.


68.

The Lease Agreement permits Plaintiff to use the Besaw's name only for as long

as it operates the restaurant in the Besaw's building pursuant to the Lease Agreement.
69.

Specifically, paragraphs 27 and 32.3 of the Lease Agreement (which are set out in

their entirety in paragraph 11 of this Answer) expressly prohibit Plaintiff from using the Besaw's
name for any other purpose or at any other time, and require Plaintiff to transfer whatever rights
it may have in the Besaw's name to C.E. John upon termination of the Lease Agreement.
70.

Both JGA and C.E. John fully performed and, to the extent necessary, will

continue to fully perform all of their respective obligations under the Lease Agreement, and have
not breached any of those obligations.

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Plaintiff has repudiated and breached its obligations under the Lease Agreement

by positively, definitely, absolutely, unconditionally and unequivocally declaring that it will not
honor its obligations to (i) cease all use of the Besaw's name upon termination of the Lease
Agreement and (ii) transfer to C.E. John whatever interest it may have or claim in the Besaw's
name.
72.

Plaintiff asserts that it owns all rights in the Besaw's name, that it intends to open

a new restaurant near the Besaw's building following the termination of the Lease Agreement
and that it will call the new restaurant "Besaw's." Plaintiff also has engaged in a public relations
campaign designed to undermine C.E. John and any future operator of the restaurant facilities at
the Besaw's building. Plaintiff has falsely represented to the public that it owns the Besaw's
name and that it has the right to continued use of that name following termination of the Lease
Agreement. It has also falsely stated that C.E. John refused to negotiate a new lease or lease
extension with Plaintiff and somehow failed to deal with Plaintiff in good faith.
73.

Additionally, Plaintiff has filed two federal trademark applications claiming that it

owns the Besaw's nameone for the name itself (Appl. No. 86567183), and another for a logo
derived from the historic sign on the Besaw's building that incorporates the Besaw's name
(Appl. No. 6567209). Plaintiff has also filed an Oregon state trademark registration for the
Besaw's name (Registration No. 43686), claiming that Plaintiff owns the Besaw's name.
74.

Plaintiff's repudiation and breach are material, and thus constitute a total breach

of the Lease Agreement, because the Lease Agreement's terms concerning the Besaw's name go
to the substance of the agreement, and because Plaintiff's breach of those terms defeats an
essential object and premise of the Lease Agreement to permit Plaintiff, as a tenant operator, to
operate the restaurant for a limited time and subject to the conditions in the Lease Agreement
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concerning use of the Besaw's name, which name has been intimately associated with the
Besaw's building and restaurant facilities and their owners for over 100 years.
75.

As a result of Plaintiff's breach of the Lease Agreement, C.E. John has suffered

and will suffer irreparable harm to the value of its goodwill associated with the Besaw's building
and restaurant facilities and business. However, such damages would be very difficult to
quantify or prove with reasonably certainty and C.E. John is without an adequate remedy at law.
76.

C.E. John is entitled to declaration of rights under the Lease Agreement.

Specifically, the Court should declare that upon and after termination of the Lease Agreement,
Plaintiff has no further right to use the Besaw's name, whether in a trademark sense or as the
name of a restaurant or other business, and that Plaintiff is obliged to transfer and assign to C.E.
John any and all right, title or interest that Plaintiff may have or claim in the Besaw's name or
any variation, whether in connection with providing restaurant services or for any other purpose.
77.

In addition, C.E. John is entitled to an order mandating Plaintiff to specifically

perform its obligations under the Lease Agreement related to the name Besaw's and any
variation. Specifically, the Court should:
77.1

Order Plaintiff to cease any and all trademark, trade name, business name

or similar use of "Besaw's" or any variation upon termination of the Lease Agreement.
77.2

Order Plaintiff to assign to C.E. John all right, title and interest in the

Besaw's name, including, without limitation, all right, title and interest in the Besaw's logo, the
internet domain name "www.besaws.com," all of Plaintiffs pending federal trademark
applications related to the Besaw's name and Plaintiffs current state registration of the Besaw's
name.

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Alternative to the relief requested in paragraph 77.2 above, in the event

such relief is not granted, the Court should compel Plaintiff to immediately cancel or abandon all
right, title and interest in "Besaw's" or any variation, including, without limitation, all of
Plaintiff's federal trademark applications concerning the Besaw's name or logo, its state
registration of the Besaw's name and its registration of the internet domain name
"www.besaws.com."
78.

C.E. John also is entitled to a preliminary and permanent injunction ordering

Plaintiff, and all those acting in concert with it, to:


78.1 Refrain from using the Besaw's name, the Besaw's logo, and any and all
variations thereof for any purpose, including, without limitation, for any restaurant or hospitality
business or service, as a trade name or trademark, and from maintaining "www.besaws.com" as
an internet domain name for any purpose.
78.2

Refrain from filing, prosecuting or maintaining any and all federal or state

trademark applications or registrations that relate to the Besaw's name, including, without
limitation, (i) federal trademark applications (#86567183 and #86567209), which currently are
pending in the U.S. Patent and Trademark Office, and (ii) the registration with the Oregon
Secretary of State (#43686).
79.

C.E. John is entitled to an award of its attorneys' fees under terms of the Lease

Agreement on page 4: "[i]n case suit or action is instituted to enforce compliance with any of the
terms, covenants or conditions of this lease . . . the losing party agrees to pay the prevailing
party's reasonable attorney fees incurred throughout such proceeding, including at trial, on
appeal, and for post-judgment collection." The Lease Agreement further provides that "[Ole
lessee agrees to pay and discharge all lessor's costs and expenses, including lessor's reasonable
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attorney's fees that shall arise from enforcing any provision or covenants of this lease even
though no suit or action is instituted."
80.

Additionally, paragraph 6.7 of the 2005 Restaurant Assignment executed by C.E.

John's predecessor in interest provides that "[i]f any arbitration or litigation is instituted to
interpret, enforce or rescind this Assignment . . . the prevailing party on a claim will be entitled
to recover with respect to the claim, in addition to any other relief awarded, the prevailing party's
reasonable attorney's fees and other fees, costs, and expenses of every kind[.]"
81.

Accordingly, C.E. John is entitled to an award of reasonable attorneys' fees and

costs, including those fees incurred prior to the time Plaintiff filed this lawsuit.
SECOND COUNTERCLAIM
(Trademark InfringementLanham Act Section 43(a) (15 U.S.C. 1125(a)))
In the event that the Court finds that the adjudication of the parties' respective rights and
obligations under the Lease Agreement does not resolve the parties' dispute and render
consideration of Plaintiff's trademark infringement claims allegations unnecessary, C.E. John
asserts the following alternative counterclaim:
82.

C.E. John incorporates and realleges its admissions, denials and allegations in

paragraphs 1-80 as though fully set forth herein.


83.

This Court has subject matter jurisdiction over this Second Counterclaim under 28

U.S.C. 1331 because it concerns a question of federal law.


84.

C.E. John owns all rights in the Besaw's name and the goodwill associated with

the restaurant services and operations at the Besaw's building. C.E. John and its predecessors in
interest have deliberately and continuously used the Besaw's name since at least the early 1990s
in operating, either directly or through the use of tenant restaurant operators, a restaurant known
as "Besaw's" located in the Besaw's building. Restaurant operations at the Besaw's building
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have been conducted, off and on, since approximately 1903, and always under the Besaw's
name.
85.

The Besaw's name is widely known in Portland, Oregon and has led the public to

identify the Besaw's name exclusively with the Besaw's building and the Besaw's building's
restaurant facilities and operations owned by C.E. John and its predecessors in interest. The
Besaw's building is a historic location that has housed a restaurant or similar establishment off
and on for over 100 years.
86.

Any right, title or interest that Plaintiff may currently have in the Besaw's name is

governed by the Lease Agreement, which permits Plaintiff to use the Besaw's name only in
connection with its operation of the restaurant at the Besaw's building and only until the
termination of the Lease Agreement. When the Lease Agreement terminates on May 31, 2015,
Plaintiff's right to use the Besaw's name will terminate, and Plaintiff will have no further or
continuing right to use the Besaw's name for any trademark or commercial purpose.
87.

Plaintiffs current public relations campaign and its stated intention to use the

Besaw's name for a new restaurant near the Besaw's building are wrongful, and are likely to
cause confusion and mistake among consumers, and to deceive consumers as to the ownership,
affiliation, connection and association of Besaw's with Plaintiff and its new restaurant, or with
C.E. John and the restaurant operations at the Besaw's building.
88.

Through its conduct as alleged above, Plaintiff has violated and, unless restrained,

will continue to violate Section 43(a) of the Lanham Act (15 U.S.C. 1125(a)).
89.

Plaintiffs misuse of the Besaw's name has caused and will continue to cause

C.E. John to sustain substantial damage, loss and injury, in an amount that is not currently
capable of being ascertained. C.E. John has no adequate remedy at law.
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90.

Document 6

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Because of the willful nature of Plaintiff's conduct in the face of the clear

language of the Lease Agreement, the Court should declare that this is an exceptional case and
that C.E. John is entitled to an award of attorneys' fees under 15 U.S.C. 1117(a).
THIRD COUNTERCLAIM
(Cancellation of Oregon Trademark RegistrationORS 647.075)
In the event that the Court finds that the adjudication of the parties' respective rights and
obligations under the Lease Agreement does not resolve the parties' dispute regarding Plaintiffs
state trademark registration, C.E. John asserts the following alternative counterclaim:
91.

C.E. John incorporates and realleges its admissions, denials and allegations in

paragraphs 1-80 as though fully set forth herein.


92.

This Court has subject matter jurisdiction over this Third Counterclaim under 28

U.S.C. 1367, because it arises out of the same property, agreements, and other transactions and
occurrences that are the subject matter of Plaintiffs Complaint, and is so related to Plaintiffs
claims that it forms part of the same case or controversy.
93.

Plaintiff filed an Oregon state trademark registration for the Besaw's name

(#43686), claiming that Plaintiff owns the Besaw's name.


94.

Plaintiff is not the owner of the Besaw's name and is obliged under the Lease

Agreement to cease all use of the name after May 31, 2015. Plaintiff acquired only a limited,
temporary right to use the Besaw's name for the duration of the Lease Agreement and solely in
connection with its restaurant operations at the Besaw's building pursuant to, and subject to the
terms of, the Lease Agreement. C.E. John and its predecessors were and remain the sole owners
of all right, title and interest in the Besaw's name and to its use in connection with restaurant
operations in the Portland metropolitan area, at least, and in connection with conducting leasing
operations and development at the Besaw's building.
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95.

Document 6

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In connection with its registration of "Besaw's" with the Oregon Secretary of

State as an Oregon trademark, Plaintiff represented that it "own[s] the mark, the mark is in use,
and no other person has registered the mark with the federal government or in Oregon or has the
right to use the mark or a mark that so resembles the mark as to be likely to cause confusion or
mistake or deceive when applied to the goods or services of the other person."
96.

At the time Plaintiff registered "Besaw's" as a trademark with the Oregon

Secretary of State, (i) Plaintiff was aware that C.E. John was the true owner of all right, title and
interest in the Besaw's name, (ii) Plaintiff was aware of its obligations under the Lease
Agreement to cease all use of the Besaw's name upon the Lease Agreement's termination, and to
convey whatever rights it may have or claim in the name to C.E. John, and (iii) Plaintiff was
aware that C.E. John previously had filed an application to register "Besaw's" with the U.S.
Patent and Trademark Office (Appl. No. 86518024).
97.

Notwithstanding the foregoing, Plaintiff filed its registration and made the

representations above with the intent that the Oregon Secretary of State rely on them. The
Oregon Secretary of State did rely on Plaintiff's representations, which, on information and
belief, it had no reason to believe were false, by registering Besaw's as a trademark in Plaintiff's
name.
98.

Pursuant to ORS 647.075, C.E. John is entitled to an order (i) finding that Plaintiff

is not the owner of the Besaw's name and that Plaintiffs registration of that name with the
Oregon Secretary of State was obtained fraudulently, and (ii) ordering cancellation of Plaintiffs
state registration of the Besaw's name. Alternatively, C.E. John is entitled to an order requiring
Plaintiff to assign to C.E. John the state registration or, alternatively, to withdraw and cancel its
state trademark registration of "Besaw's."
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PRAYER FOR RELIEF


WHEREFORE, the Court should enter judgment in favor of C.E. John as follows:
1.

Dismissing Plaintiff's claims with prejudice;

2.

Declaring that upon and after termination of the Lease Agreement, Plaintiff has

no right to use the Besaw's name or any variation, whether in a trademark sense, as a trade name,
as the name of a restaurant or other business, or for any other commercial purpose, and that
Plaintiff is obliged to transfer and assign to C.E. John any and all right, title or interest that
Plaintiff may have or claim in the Besaw's name or any variation, whether in connection with
providing restaurant services or for any other purpose;
3.

Ordering Plaintiff to perform its obligations under the Lease Agreement related to

the Besaw's name and all variations. Specifically,


3.1

Ordering Plaintiff to cease use of "Besaw's" (or any variation) upon and

after termination of the Lease Agreement.


3.2

Ordering Plaintiff to assign to C.E. John (in a form of document

reasonably satisfactory to C.E. John) all right, title and interest that Plaintiff may have in the
Besaw's name, including, without limitation, all right, title and interest in the Besaw's logo, the
internet domain name "www.besaws.com," all of Plaintiffs pending federal trademark
applications related to the Besaw's name or logo and Plaintiffs current Oregon state registration
of the Besaw's name.
(a)

In the alternative to the relief requested in paragraph 3.2 of this Prayer,

and in the event such relief is not granted, the Court should order Plaintiff to immediately cancel
or abandon all of its claimed interests in the Besaw's name, including, without limitation, its

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federal trademark applications concerning the Besaw's name and logo, its state registration of the
Besaw's name and its registration of the internet domain name "www.besaws.com;"
4.

Entering a preliminary and permanent injunction restraining Plaintiff, and all

those acting in concert with Plaintiff, from:


4.1

Using the Besaw's name, the Besaw's logo, and any and all variations

thereof for any purpose, including, without limitation, for any restaurant or hospitality business
or service, or as a trade name or trademark, and from maintaining the "wwvv.besaws.com" as an
internet domain name for any purpose.
4.2

Filing, prosecuting or maintaining any and all federal or state trademark

applications or registrations that relate to the Besaw's name or any variation, including without
limitation, (i) federal trademark applications #86567183 and #86567209, which currently are
pending in the U.S. Patent and Trademark Office, and (ii) Plaintiff's "Besaw's" trademark
registration with the Oregon Secretary of State (#43686);
5.

Requiring Plaintiff to file with this Court (with a copy to C.E. John) a report, in

writing and under oath, setting forth in detail the manner and form in which it has complied with
the orders of the Court, which report must be filed and served within 30 days after entry of the
Court's judgment;

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6.

Document 6

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Awarding C.E. John its reasonable attorneys' fees and costs, together with its

costs and disbursements; and


7.

Awarding C.E. John such other and further relief as the Court may deem just and

proper.
DATED: May 8, 2015.

STOEL RIVES LLP

s/ Randolph C. Foster
Randolph C. Foster, OSB No. 784340
randy.foster@stoel.com
Edward A. Piper, OSB No. 141609
ed.piper@stoel.com
900 SW Fifth Avenue, Suite 2600
Portland, OR 97204
Telephone: (503) 224-3380
Facsimile: (503) 220-2480
Attorneys for Defendant
C.E. John Properties 65, LLC

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CERTIFICATE OF SERVICE
I hereby certify that I served the foregoing C.E. JOHN PROPERTIES 65, LLC'S
ANSWER, DEFENSES AND COUNTERCLAIMS on the following named person(s) on the
date indicated below by
nn notice of electronic filing using the
Cm/ECF system
Dennis Steinman, OSB No. 954250
dsteinman@kelrun.com
Thomas R. Rask, III, OSB No. 934031
traskAkelrun.com
Scott J. Aldworth, OSB No. 113123
saldworthAkelrun.com
Mathew W. Lauritsen, OSB No. 083949
mlauritsena,kelrun.com
KELL, ALTERMAN & RUNSTEIN, LLP
520 SW Yamhill Street, Suite 600
Portland, OR 97204
Telephone: (503) 222-3531
Fax: (503) 227-2980
Attorneys for Plaintiff
DATED: May 8, 2015.

STOEL RIVES LLP

s/ Randolph C. Foster
Randolph C. Foster, OSB No. 784340
randy foster@stoel.com
Edward A. Piper, OSB No. 141609
ed.piperAstoel.com
900 SW Fifth Avenue, Suite 2600
Portland, OR 97204
Telephone: (503) 224-3380
Facsimile: (503) 220-2480
Attorneys for Defendant
C.E. John Properties 65, LLC

Page 1

CERTIFICATE OF SERVICE

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EXHIBIT
1

Exhibit 1 - CE John Properties LLC Answer


Page 1 of 25

Case 3:15-cv-00749-BR
i

FORM No. 812 - LEASE - BUSINESS PROPERTY.

Document 6

Filed 05/08/15

STEVENS-NESS LAW PUBLISHING

COPY

Page 26 of 65
CO.. PORTLAND. OR 97204

NtEE

THIS INDENTURE OF LEASE, entered into this


ASSOCIATES
ASSOC
between JONES GR
hereinafter called the lessor, and

day of March

2.005

BMW'S CAFE

,hereinafter called the lessee,

lessee those
the
unto
leases
hereby
the
herein,
lessor
covenants
the
of
n
WITNESSETH: In consideratio
and State
a.
of
County
...111,11:Mgra
,
.ged
Ffygt.l
of
City
the
in
certain premises, as is, situated
as
followsl
described
premises,
the
called.
hereinafter
,
of Oregon

A portion of the hut14#8 commonly known as "Besaws" located at the Northwest corner
of Northwest .4vter and Northwest .23rd Ave,, Lot 4, Block 312, COUCHIS ADDITION,
also known as 2301 NW Sayer St, Portland, Oregon, the portion of the building
A,
constituting the demised premises being shown on .the amp attached hereto as Exhibit
tely
approxima
and
space
floor
main
of
feet
square
1,500
ately
approxin
of
g
and consistin
576 square feet of basement space,

2005

June
1st day of
To Have and to Hold the premises commencing with the
a rental of $-.1.82-416
20.11)for
alat day of .N.ay
and ending at midnight on the
NArbox_Mx..,..1.17
for the whole term, which lessee agrees to pay, at
Portland
, State of Oregon 97217at the following times and in the following amounts, to-wit:
City of
June 1,
June 1,
June 1,
June 1,
June 1,

2005
2005
2007
.2008
2009

through tlay.31,
through avlay31,
through 2'!ay'.1,
through day, 31,
through MAy. :31,

Total Dase Pent


ktriple net)

2006
2007
2008
2009.
2010

$2,857.00
$2,943.00
$3,031.00
$3,122.00
$3,215.00

per me:. .= $34,284.00


per mo. ==. $35,316.00
per mo. = $36,372.00
Per no. = $37,464.00
per 1110. = $38,580.00
$182,016.00

the parties
In consideration of the leasing of the premises and of the mutual agreements herein contained,
agree as follows:
Exhibit 1 - CE John Properties LLC Answer
Page 2 of 25

Case 3:15-cv-00749-BR

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LESSEE'S
ACCEPTANCE
OF LEASE

(1) The lessee accepts this letting and agrees to pay to the order of the lessor the monthly rentals above stated for the
full term of this lease, in advance, at the times and in the manner aforesaid.

USE OF
PREMISES

(2a) The lessee shall use the premises during the term of thid lease for the conduct of the following business:

Restaurant.

and for no other purpose whatsoever without lessor's written consent.


(2b) The lessee will not make any unlawful, improper or offensive use of the premises the lessee will not suffer any strip or waste
thereof; the lessee will not permit any objectionable noise or odor to escape or to be emitted 'from the premises or do anything.or permit
anything to be done upon or .about the premises in any way tending to create a nuisance; the lessee will not sell or permit to be sold any
product, substance or service upon or about the premises, excepting such as lessee may be licensed by law to sell and as may be herein
expressly permitted.

(2c) The lessee will not allow the premises at any time to fall into such a state of repair or disorder as to increase the fire hazard
thereon; the lessee will not install any power machinery on the premises except under the supervision and with written consent of the lessor;
the lessee will not store gasoline or other highly combustible materials on the premises at any time; the lessee will not use the premises in
such a way or for such a purpose that the fire insurance rate on the improvements on the premises is thereby increased or that would
prevent the lessor from taking advantage of any rulings of any agency of the state in which the premises are situated, or which would
allow the lessor to obtain reduced premium rates for long term fire insurance policies.
(2d) The lessee shall comply at lessee's own expense with all laws and regulations of any municipal, county, state, federal or other
public authority respecting the use of the premises. These include, without limitation, all laws, regulations and ordinances pertaining to
air and water quality, Hazardous Materials as herein defined, waste disposal, air emissions, and other environmental matters. As used
herein, Hazardous Material means any hazardous or toxic substance, material, or waste, including but not limited to those substances,
materials, and 'waste listed in the U.S. Department of Transportation Hazardous. Materials Table or by the U.S. Environmental Protection
Agency as hazardous substances and amendments thereto, petroleum products, or such other substances, materials, and waste that are or
become regulated under any applicable local, state, or federal law.
or vacate the
(2e) The lessee shall regularly occupy and use the premises for the conduct of lessee's business, and shall not abandon

premises 'for more than ten days without written approval of lessor.
(2f) Lessee shall not cause or permit any Hazardous Material to be brought upon, kept or used in or about the premises by
lessee, its agents, employees, contractors, or invitees without the prior written consent of lessor, which consent will not be unreasonably
withheld so long as lessee demonstrates to lessor's reasonable 'satisfaction that such Hazardous Material is necessary or useful to lessee's
business and will be used, kept, and stored in a manner that will comply at all times with all laws regulating any such Hazardous Material
so brought upon or used or kept on or about the premises.
:UTILITIES
(3) The lessee shall pay for all heat, light, water, power, and other services or utilities used in the premises during the
term of this lease.
REPAIRS AND
(4a) The lessor shall not be required to make any repairs, alterations, additions or improvements to or upon the pramIMPROVEMENTS ises during the term of this lease, except only those hereinafter specifically provided for; the lessee hereby agrees to
maintain and keep the premises, including all interior and exterior walls and doors, heating, ventilating and cooling systems, interior wiring,
plumbing and drain pipes to sewers or septic tank, in good order and repair during the entire term of this lease, at lessee's own cost and
expense, and to replace all glass which may be broken or damaged during the term hereof in the windows and doors of the premises with
glass of as good or better quality as that now in use; it is further agreed that the lessee will makp po alterations, additions,qrsimprovements
to or upon the premises without the written consent of the lessor first being obtained. (scont a at raragrapn 19)
(4b) The lessor agrees to make all necessary structural repairs to the building, including exterior walls, foundation, roof, gutters and
downspouts, and the abutting sidewalks. The lessor reserves and at any and all times shall have the right to alter, repair or improve the
building of which the premises are a part, or to add thereto, and for that purpose at any' time may erect scaffolding and all other necessary
structures about and upon the premises and lessor and lessor's representatives, contractors and workers for that purpose may enter in or
about the premises with such materialsats lessor may deem ne-Le ssary therefor. and lessee waives any claim to damages includine loss of
aims tor lessor's negi,igent itjury to
business resulting therefrom. excepting therefrom taose

4
therefrom
Person or . prop erty aring

LESSOR'S
RIGHT OF
ENTRY

RIGHT OF
ASSIGNMENT

(5) It shall be lawtullor fhe lessor, the lessor s agants and representatives, at any reasonable time to enter into or upon
the premises for the purpose Of examining into the condition thereof, or for any other lawful purpose.

LIENS

(7) The lessee will not permit any lien of any kind, type or description to be placed or imposed upon the improvements
in which the premises are situated, or any part thereof, or the land on which they stand.

(6) The lessee will not assign, transfer, pledge, hypothecate, surrender or dispose of this lease, or any interest herein,
sublet, or permit any other person or persons whomsoever to occupy' the premises without the written consent of the
lessor being first obtained in writing; this lease is personal to lessee; lessee's interests, in whole or in part, cannot be
sold, assigned, transferred, seized or taken by operation at law, or under or by virtue of any execution or legal process, attachment or proceedings instituted 'against the lessee, or under or by virtue of any bankruptcy or insolvency proceedings had in regard to the lessee, or in
any other manner, except as above mentioned. '

ICE, SNOW,
DEBRIS

(8) If the premises are located at street level, then at all times lessee shall keep the sidewalks in front of the premises
free and clear of ice, snow, rubbish, debris and obstruction; and if the lessee occupies the entire building, the lessee will
not permit rubbish, debris, ice or snow to accumulate on the roof of the building so as to stop up or obstruct gutters or
downspouts or cause damage to the roof, and will save harmless and protect the lessor against any injury whether to lessor or to lessor's
property or to any other person or property caused by lessee's failure in that regard.
OVERLOADING
OF FLOORS

(9) The lessee will not overload the floors of the premises in such a way as to cause any undue or serious stress or
strain upon the building in which the premises are located, or any part thereof, and the lessor shall have the' right, at
any time, to call upon any competent engineer or architect whom the lessor may choose, to decide whether or not the
floors of the premises, or any part thereof, are being overloaded so as to cause any undue or serious stress or strain on the building, or anj'
part thereof, and the decision of the engineer or architect shall be final and binding upon the lessee; and in the event that it is the
opinion of the engineer or architect that the stress or strain is such as to endanger or injure the building, or any part thereof, then and
in that event the lessee agrees immediately to relieve the stress or strain, either by reinforcing the building or by lightening the load which
causes such stress or strain, in a manner satisfactory to the lessor.
ADVERTISING
SIGNS

(10) The lessee will not use the outside walls of the premises, or allow signs or devices of any kind to be attached
thereto or suspended therefrom, for advertising or displaying the name or business of the lessee or for any purpose
whatsoever without the written consent of the lessor; however, the lessee may make use of the windows of the premises
to display lessee's name and business when the workmanship of such signs shall be of good quality and permanent nature; provided further
that the lessee may not suspend or place within said windows or paint thereon any banners, signs, sign-boards or other devices in violation
of the intent and meaning of this section,

Exhibit 1 - CE John Properties LLC Answer


Page 3 of 25

Case 3:15-cv-00749-BR

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(11) At all times during the term hereof, the lessee will, at the lessee's own expense, keep in effect and deliver to the
lessor liability insurance policies in form, and with an insurer, satisfactory to the lessor. Such policies shall insure both
the lessor and the lessee against all liability for damage to persons or property in, upon, or about the premises. The amount of such insur500,000

500,000
for injuries
for injury to one person, not less than $
ance shall be not less than $
500,
000
for damage to property, or a combined
to all persons arising out of any single incident, and not less than $
500, 000
It shall be the responsibility of lessor to purchase casualty insurance with
single limit of not less than $
extended coverage so as to insure any structure on the premises against damage caused by fire or the effects of fire (smoke, heat, means
of extinguishment, etc.), or any other means of loss. It shall be the responsibility of the lessee to insure all of the lessee's belongings upon
the premises, of whatsoever nature, against the same. With respect to these policies, lessee shall cause the lessor to be named as an additional insured party. Lessee agrees to and shall indemnify and hold lessor harmless against any and all claims and demands arising from
the negligence of the lessee, lessee's officers, agents, invitees and/or employees, as well as those arising from lessee's failure to comply
with any covenant of this lease on lessee's part to be performed, and shall at lessee's own expense defend the lessor against any and all
suits or actions arising out (4 such negligence, actual or alleged, and all appeals therefrom and shall satisfy and discharge any judgment
which may be awarded against lessor in any such suit or action,
LIABILITY
INSURANCE

(12) All partitions, plumbing, electrical wiring, additions to or improvements upon the premises, whether installed by
the lessor or lessee, shall be and become a part of the building in which the premises are located as soon as installed and the property of
the lessor unless otherwise herein provided.

FIXTURES

LIGHT
AND AIR

(13) This lease does not grant any rights of access to light and air over the premises or any adjacent property.

DAMAGE BY
CASUALTY,.
FIRE AND
DUTY TO
' .
REPAIR

(14) In the event of the destruction of the improvements in which the premises are located by fire or other casualty,
either party hereto may terminate this lease as of the date of fire or casualty, provided, however, that in the event

25
per cent or more of the sound
of damage to the improvements by fire or other casualty to the extent of

value thereof, the lessor may or may not elect to repair the same; written notice of lessor's election shall be given,lessee within fifteen
days after the occurrence of the damage; if notice is not so given, lessor conclusively shall be deemed to have elected not to repair; in the
event lessor elects not to repair,.then and in that event this leaseshall terminate with the date of the damage; but if the improvements
in which the premises are located be but partially destroyed and the damage so occasioned shall not amount to the extent indicated,above,
or if greater than said extent and lessor elects to repair, as aforesaid, then the lessor shall repair the same with all convenient speed and
shall have the rightto take possession of and occupy, M the exclusion of the lessee, all or any part thereof in order to make the necessary
repairs, and the lessee hereby agrees to vacate upon request, all or any part thereof which the lessor may require for the purpose of making
necessary repairs, and for the period of time between the day of such damage and until such repairs have been substantially completed
there shall be such an abatement of rent as the nature of the injury or damage and its interference with the occupancy of the premises by
the lessee shall warrant; however, if the premises be but slightly injured and the damage so occasioned shall not cause any material interference with the occupation of the premises by lessee, then there shall be no abatement of rent and the lessor shall repair the damage

with all convenient speed.


(15) Neither the lessor nor the lessee shall be liable to the other for loss arising out of damage to or destruction of
the premises, or the building or improvement of which the premises are a part or with which they are connected, or
the contents of any thereof, when such loss is caused by any of the perils which are or could be included within or insured against by a standard form of fire insurance with extended coverage, including sprinkler leakage insurance, if any. All such claims
for any and all loss, however caused, hereby are waived. Such absence of liability shall exist whether or not 'the damage or destruction is
caused by the negligence of either lessor or lessee or by any of their respective agents, servants or employees. It is the intention and agreement of the lessor and the lessee that the rentals reserved by this lease. have been fixed in contemplation that both parties shall fully
provide their own insurance protection at their own expense, and that both parties shall look to their respective insurance carriers for
reimbursement of any such loss, and further, that the insurance carriers involved shall not be entitled to subrogation under- any circumstances against any party to this lease. Neither the lessor nor the lessee shall have any interest or claim in the other's insurance policy or
policies, or the proceds thereof, unless specifically covered therein as a joint assured.
WAIVER OF
SUBROGATION
RIGHTS

(16) In case of the condemnation or purchase of all or any substantial part of the premises by any public or private
corporation with the power of condemnation this lease may be terminated, effective on the date possession is taken, by
either party hereto on written notice to the other and in that case the lessee shall not be liable for any rent after the termination date..
Lessee shall not be entitled to and hereby expressly waives any right to any part of the condemnation award or purchase price.
. . .
.
.
FOR SALE
(17) During the period of 120
days prior to the date above fixed for the termination of this lease, the lessor
AND
herein
may
post
on
the
premises
or
in
the
windows
thereof
signs
of
moderate
size
notifying
the
public
that
the premises
FOR RENT
are "for sale" or "for lease."
SIGNS
EMINENT
DOMAIN

DELIVERING UP
PREMISES ON
TERMINATION

(18) At the expiration of the lease term or upon any sooner termination thereof, the lessee will quit and deliver up
the premises and all future erections or additions to or upon the same, broom-clean, to the lessor or,those having lessor's
estate in the premises, peaceably, quietly, and in as good order and condition, reasonable use and wear thereof, damage
by fire, unavoidable casualty and the elements alone excepted, as the same are now in or hereafter may be put in by the lessor.
ADDITIONAL
COVENANTS
OR
EXCEPTIONS

(19)

See addendum to lease for additional lease provisions

Paragraph 4(a) contM


Lessee Sail maintain in :
0 )(7) 4 condition and repair the heating, ventilating and
air conditioning systgru(PV4C) and Lessee shall provide.Lessor.with redeipts.of
maintenance .service. Lessor ligly..at.Lessor's sole option, contract with a
service.coWany for IT;a4itpgallge o the.gVAC system; in sueh event, the full.
he.
..00st.of-this..serlilce shall
paid by Lessee as additional .rnt;in equal
i thl3n installments,

Exhibit 1 - CE John Properties LLC Answer


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the
PROVIDED, ALWAYS, and then presents are upon these conditions, that (I) if the lessee shall be in arrears in
neglect to perform
payment of rent for a period of feaNdbys after the same becomes due, or (2) if the lessee shall fail or
or observe any of the covenants and agreements contained herein on 'lessee's part to be done, kept, performed and obbe given
served and such default shall continue forLiPikeys or more after written notice of such failure or neglect shall
insolvent according to law, or (4) if any assignment of lessee's property shall be
to lessee, or (3) if the lessee shall be declared bankrupt or
possession of the premises, the lessor or
made for the benefit of creditors, or (5) if on the expiration of this lease lessee fails to surrender
option
immediately or at any time thereafter,
lessor's
at
and,
lawfully,
lease
this
terminate
the
may
premises,
in
estate
those having lessor's
and every part thereof and reposses the same, and expel lessee and those
without demand or notice, enter into and upon the premises
effects at lessee's expense, forcibly it necessary and store the same, all without
claiming by, through and under lessee and remove lessee's
remedy which otherwise might be used for arrears of rent or preceding
being deemed guilty of trespass and without prejudice to any
breach of covenant.
of possession of the premises shall deprive lessor of
Neither the termination of this lease by forfeiture nor the taking or recovery
damages, nor shall any omission by lessor to enforce any forfeiture,
any other action, right, or remedy against lessee for possession, rent or
by lessor of the right to enforce the performance of all terms and
a
right or remedy to which lessor may be entitled be deemed waiver
conditions of this lease by lessee.
in whole or in part to any tenant or tenants who may
In the event of any re-entry by lessor, lessor may lease or relet the premises
and conditions as lessor may reasonably obtain. Lessor shall apply
be satisfactory to lessor, for any duration, and for the best rent, terms
remodeling required to obtain any
the rent received from any such tenant first to the cost of retaking and reletting the premises, including
this lease and any other damages to which lessor may be entitled
such tenant, and then to any arrears of rent and future rent payable under
hereunder.
more than ten days after any
Any property which lessee leaves on the premises after abandonment or expiration of the lease, or forsell the property at public or
and
and
lessor
may
remove
abandoned,
been
have
to
deemed
be
shall
landlord,
by
lease
the
termination of
by reason thereof, and the net proceeds of
private sale as lessor sees fit, without being liable for any prosecution therefor or for damages balance of such amounts, if any, shall be
any such sale shall be applied toward the expenses of landlord and rent. as aforesaid, and the
held for and paid to the lessee.
over shall not be
HOLDING
In the event the lessee for any reason shall hold over after the expiration of this lease, such holding
OVER
deemed to operate as a renewal or extension of this lease, but shall only create a tenancy at sufferance which may
be terminated at will at any time by the lessor.
this lease,
ATTORNEY
In case suit or action is instituted to enforce compliance with any of the terms, covenants or conditions of
FEES AND
the rental which may become due hereunder, or any portion thereof, the losing party agrees to pay the precollect
to
or
COURT COSTS
vailing party's reasonable attorney .fees incurred throughout such proceeding, including at trial, on appeal, and for postjudgment collection. The lessee agrees to pay and discharge all lessor's costs and expenses, including lessor's reasonable
no suit or action is instituted.
attorney's fees that shall arise from enforcing any provision or covenants of this lease even though
otherwise, either during the
Should the lessee be or become the debtor in any bankruptcy proceeding, voluntarily, involuntarily or

created by this lease in favor of the lessor, the


period this lease is in effect or while there exists any outstanding obligation of the lessee
incur as the result of lessor's participation in
lessee agrees to pay the lessor's reasonable attorney fees and costs which the lessor may federal bankruptcy law or rules of procedure
applicable
that
parties
both
by
agreed
and
is
It
understood
proceedings.
such bankruptcy
sentence.
may affect, alter, reduce or nullify the attorney fee and cost awards mentioned in the preceding
ATTACHMENT
BANKRUPT
DEFAULT

by the lessee shall


Any waiver by the lessor of any breach of any covenant herein contained to be kept and performed
from declaring
not be deemed or considered as .a continuing waiver, and shall not operate to bar or prevent the lessor
otherwise.
or
covenant
or
condition
same
the
of
either
breach,
succeeding
any
for
forfeiture
a
be given,
NOTICES
Any notice required by the terms of this lease to be given by one party hereto to the other or desired so to
and
shall be sufficient if In4riting,contained in a sealed envelope, allifient first class mail, with postage fully prepaid,
..
._97217--.....
3
..1
.ctrtland..-0R
rbox,..Dz.....7...#17.,.
:....9.01.1rlia
at
lessor
the
if
to
addressed
then
herein,
lessor
if intended for the
and if intended for the lessee, then if addressed to the
Any such
9721.0.
Vartland
2301 Ng
lessee at
in the U.S. Mail.
notice shall be deemed conclusively to have been delivered tothe addressee forty-eight hours after the deposit thereof

WAIVER

to, inure
HEIRS AND
All rights, remedies and liabilities herein given to or imposed upon either of the parties hereto shall extend'
ASSIGNS
to the benefit of and bind, as the circumstances may require, the heirs, successors, personal representatives and so far
as this lease is assignable by the terms hereof, to the assigns of such parties.
requires,
In construing this lease; it is ._understood tharthe lessor or the lessee may be more.thamone ..passon; that if the context so assumed
be made,
the singular pronoun shall be taken.-to mean and include the, plural, and that generally all grammatical changes shall
and implied to make the provisions hereof apply equally to corporations and to individuals.

IN WITNESS WHEREOF, the parties have executed this lease on the day and year first hereinabove written,
aorporation signature being by authority of its Board of Directors. N,
(
4,1
.2

f.

4e c.

The publisher strongly recommends that both the lessor and the lessee become familiar with the Americans with Disabilities Act of
1990, Public Laws 101-336. The Act may impose certain duties and responsibilities upon either or both parties to this lease. These
duties and responsibilities may include but not be limited to the removal of certain architectural barriers and ensuring that disabled
persons are not denied the opportunity to benefit from the same goods and services as those available to persons without disabiliowner, operator, lessor, or lessee of a place
ties. Under the Act, prohibition against discrimination applies to any person who is the
Exhibit 1 - CE John Properties LLC Answer
of public accommodation.
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ADDENDUM TO LEASE
JONES GROUP ASSOCIATES
TO
BESAW'S CAF INC.
THIS ADDENDUM, made and entered into concurrent with the Form No. 812 Lease
Business Property (the "Form Lease") between the parties is intended to supplement and,
where inconsistent, modify the terms of the said form lease.
19. (continued). Payment of Rent. Rent shall be payable on the first day of each
month in advance at such place as may be designated by Lessor except that the sum of $3,210
for the last month's rent and approximately one month's property taxes and insurance shall be
prepaid on June 1, 2005.
20. Security Deposit. To secure Lessee's compliance with all terms of this Lease,
Lessee has paid Lessor the additional sum of $1,000 as a deposit, receipt of which is hereby
acknowledged. The deposit shall be a debt from Lessor to Lessee, refundable within 30 days
following expiration of the Lease term or other termination not caused by Lessee's default.
Lessor shall have the right to offset against such deposit any and all sums owing from Lessee
to Lessor and not paid when due, any damages caused by Lessee's default, the cost of curing
any default by Lessee should Lessor elect to do so, and the cost of performing any repair or
clean up that is Lessee's responsibility under this Lease. Lessor shall give notice to Lessee
each time an offset is made and Lessee shall, within 10 days following such a notice, deposit
with Lessor a sum equal to the amount of the offset, so that the total deposit amount, net of
offset, shall remain constant through the Lease term. Lessor shall have no obligation to pay
interest upon or maintain said deposit in a separate account, and may co-mingle same.
21. Additional Rent. All taxes and insurance costsand any other sum which lessee is
required to pay to lessor or third parties by this lease shall be additional monthly rent. Lessee
shall pay all utilities directly to.utility companies.
21.1 Additional Rent/Taxes and Assessments. In addition to basic monthly rent set
out above, lessee agrees, during each lease year at the same time as its monthly rent shall be
paid, to pay to lessor as additional monthly rent an amount equal to one-twelfth of 66% of the
real property taxes and special assessments levied against the buirding and/or the land upon
which it is situated from the lease year, 66% being the approximate percentage of the building
devoted to the demised premises under this lease.
In the event a real property tax limitation measure is passed, any substitute taxes, in
any name or form, which may be adopted to replace or supplement real property taxes,
including but not limited to any tax on leaseholds or rents, shall be considered the equivalent
of real property tax for purposes of this section. Lessee shall pay such portion of such taxes,
assessments, and charges promptly when they are first due. Lessee's share of real property
taxes and assessments for the years in which this lease respectively is consummated and
thereafter terminates shall be prorated based upon the portion of the tax year for which this
lease is in effect. Lessee shall pay all personal property taxes applicable to the leased
premises and its contents, as and when they are due.

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Exhibit 1 - CE John Properties LLC Answer


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'

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In addition to other taxes, Lessee shall pay any taxes, fees or charges levied against
Lessor for Lessee's use, occupancy or rental of said premises imposed by any state, county,
city or political subdivision.
21.2 Additional Rent/Utilities. Pursuant to paragraph 3 of the form Lease, .Lessee
shall obtain and pay for in Lessee's name, as additional rent, all necessary utilities for the
leased premises, including electrical, gas, water and sewer, garbage, telephone and security,
and hereby agrees to indemnify, defend and hold Lessor harmless from all claims arising
therefrom.
21.3. Additional Rent/Fire Insurance. In addition to basic monthly rent set out above,
lessee agrees, during each year at the same time its monthly rent shall be paid, to pay to lessor
as additional monthly rent an amount equal to 1/12th of 66% of the lessor's annual fire
insurance premiums for the building in which the leased premises are located.
21.4. Additional Rent/Late Charge. If lessee fails to pay any rent or other payment
required by lessee within 10 days of when due, lessor shall have the right to impose a late
charge equal to 10% of the amount not paid; provided that this provision shall not abridge
lessor's ability to declare a default for a late payment
Acceptance of Premises. In addition to the provisions contained in Paragraph
22.
1 of the form Lease, it is understood and agreed that Lessee, upon execution of this lease will
be deemed to have accepted the premises AS IS.. Lessor makes no representations or
warranties to Lessee concerning the condition of the Leased Premises or the applicable uses,
variances or permits relating thereto.
23.1 Alterations Prohibited. In addition to the provisions of Paragraph 4 of the form
Lease, the restriction on alterations and improvements of the Leased Premises by the Lessee
without the prior written consent of the Lessor shall apply, to all interior design treatments
made by the Lessee to the Leased Premises including, without limitation, colors and materials
for floor, counters, window and wall coverings, including paint, which consent shall not be
unreasonably withheld. Lessee may make alterations, changes, additions and improvements
in and to the Leased Premises only according to plans and specifications therefor which
consent shall first be submitted to and approved in writing by the Lessor. No such work shall
be undertaken until the Lessee shall have submitted the plans and specifications therefor all
governmental approvals and permits shall have been procured. All such work shall be
performed subject to and in compliance with the requirements of the law and the orders, rules,
regulations and requirements of all governmental departments or authorities having
jurisdiction.
23.2 Liability Insurance. At all times when any change or alteration as approved by
Lessor is in progress, there shall be maintained, at the Lessee's sole expense, general liability
insurance for the mutual benefit of the Lessee and Lessor expressly covering the additional
hazards due to the changes or alterations.
23.3 Manner of Work. Any alterations or improvements as approved by Lessor
shall be constructed, and all worked performed, in a first-class workmanlike manner, and shall
not weaken or. impair the structural strength or lessen the value of the Leased Premises.

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Addendum to Lease

Exhibit 1 - CE John Properties LLC Answer


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-23.4 Ownership of Alterations, Improvements, and Fixtures. This paragraph


modifies and supplements the provisions of paragraph 12 of the form Lease. Except for
Lessee's trade fixtures, all fixtures, additions, and improvements, including built-in cabinets,
counters and shelving, placed upon the Leased Premises during the Lease term, whether
installed by Lessor or Lessee, shall, at Lessor's sole option, be and become a part of the
building and shall remain affixed thereto at the expiration or termination of the Lease.
However, notwithstanding the above, if Lessor so elects, Lessee shall remove any or all of
said alterations, improvements, and fixtures so designated by Lessor which would otherwise
remain the property of Lessor, and Lessee shall repair any physical damage resulting 'from the
removal. If Lessee fails to remove such fixtures or to repair the damage resulting therefrom,
Lessor may do so and charge the cost to Lessee with interest at the rate of 10% per annum
from the date of expenditure.
23.5 Removal of Trade Fixtures. Subject to the provision of paragraph 23.6, upon
expiration or termination of the Lease term, Lessee shall remove all Lessee's trade fixtures
and repair any physical damage resulting from removal. If Lessee fails to do, so, this shall be
an abandonment of the property, and Lessor shall retain the property, and all rights of Lessee
with respect to it shall cease or, by notice in writing given to Lessee within 20 days after
removal was required, Lessor may elect to hold Lessee to his obligation of removal. If Lessor
elects to require Lessee to remove, Lessor may effect the removal and place the property in
public storage for Lessee's account. Lessee shall be liable to Lessor for the cost of removal,
transportation to storage, and storage expenses from the date of expenditure by Lessor.
23.6 Reimbursement for Repairs Assumed. In addition to the provisions of
paragraphs 2 and 4 of the form Lease, if Lessee fails or refuses to make repairs which are
required thereunder, Lessor may make the repairs which are required thereunder, and charge
the actual costs of repair to Lessee. Such expenditures by Lessor shall be reimbursed by
Lessee on demand, together with interest at the rate of 10% per annum from the date of
expenditure by Lessor.
23.7 Liens. Except with respect to activities for which the Lessor is responsible, the
Lessee shall pay as due all claims for work done on and for services rendered or material
furnished to the Leased Premises, and shall keep the premises free from any liens. If Lessee
fails to pay any such claims or to discharge any lien, Lessor may do so and collect the cost as
additional rent. Any amount so added shall bear interest at the rate of.10% per annum from
the date expended by Lessor and shall be payable on demand. Such action by Lessor shall not
constitute a waiver of any right or remedy which Lessor may have on account of Lessee's
default from allowing or failing to remove said liens.
23.8 Indemnification of Lessor. Lessee will defend, indemnify and hold Lessor
harmless from any liability, loss, or damage Lessor may suffer (including reasonable attorney
fees and expenses) as a result of all claims, demands, costs or damages made against Lessor
of any kind whatsoever in connection with or arising out of (1) any violation of law,
ordinance or regulation by Lessee, its agents, employees, invitees of visitors, or (2) any injury
or damage occurring to any person or to property of any kind belonging to any person from
any cause or causes whatsoever while on or in any way connected with any portion of the
Leased Premises during the lease term, except any claims caused by the negligence of Lessor
or Lessor's agents or employees.

Page 3

Addendum to Lease

Exhibit 1 - CE John Properties LLC Answer


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23.9 Lessee's Obligation to Repair. Repair, replacement or restoration of any trade


fixtures, inventory and personal property owned by Lessee or any additions, improvements or
fixtures installed to or upon the Leased Premises shall be the responsibility of Lessee
regardless of the cause of the damage, unless caused by the negligence of the Lessor, its
agents or employees.
24.1 Security Agreement/Trade Fixtures, Restaurant Equipment and
Furnishings/Removal/Remedies. With the exception of Lessee's dishwasher, for valuable
consideration, lessee hereby grants to lessor an exclusive security interest in and to all of
lessee's trade fixtures, restaurant equipment and furnishings, now or hereafter acquired
(including but not limited to substitutions or replacements for said collateral), all accessions
thereto, and all proceeds thereof which shall be situated within or upon the leasehold
premises, to secure the payment and performance of all lessee's obligations under this lease, a
schedule of said trade fixtures, restaurant equipment, and furnishings being attached hereto as
Exhibit B.
24.2 Default/Acceleration/Remedies. Time is of the essence hereof. In the event of
any default by Lessee in performance of any obligation enumerated in this Lease, Lessor shall
have each and all of the rights and remedies granted to Lessor by the Uniform Commercial
Code of Oregon and by this Lease and may, at Lessor's option, declare all obligations
hereunder immediately due and payable without demand or notice to Lessee. All the
remedies in the accompanying Lease are cumulative, can be exercised singly, jointly, or in
any order, the waiver of one does not waive another, and all such remedies are in addition to
any other remedies allowed by law, including any possessory landlord's lien created by
Oregon Revised Statutes.
24.3 Documents. Lessee shall promptly execute and deliver to lessor all other
documents which may be or become necessary to evidence or perfect such security interests,
including, without limitation, a detailed description of all such trade fixtures and restaurant
equipment and furnishings, after-acquired property, accessions thereto and proceeds thereof
and any renewal thereof.
24.4 Warranty by Lessee. With respect to lessee's trade fixtures, restaurant
equipment, and furnishings, lessee hereby warrants to lessor that:
I. Lessee's business is in good standing in all applicable jurisdictions;
2. The collateral is owned by lessee and is free of all liens, encumbrances and
other security interests and the lessee will defend the security interest of the
lessor therein against all other claims and demands; and
3. The lessee has authority and has obtained all consents necessary to incur the
obligations secured and to enter into the security agreement.
24.5 Exclusive Security Interest. Lessee hereby agrees that it shall refrain from
granting any other security interests in and to said trade fixtures, restaurant equipment, and
furnishings and shall not otherwise encumber said collateral during this lease or any extension
thereof.

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Exhibit 1 - CE John Properties LLC Answer
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25. Removal. Notwithstanding the provisions of paragraph 23.3. above, lessee shall
not remove any trade fixtures, restaurant equipment, or furnishings, after-acquired property
accessions thereto or proceeds thereof from the leasehold premises without the prior written
consent of the lessor.
26. Signage. Notwithstanding the provisions of Paragraph 10 of the Lease, Lessee's
exterior signage shall conform to a style and size agreed upon by Lessor, which consent shall
not be unreasonably withheld. Notwithstanding Lessor's consent to any such signs, marks or
other materials referred to above, Lessee shall remove all said signs and other materials upon
termination of the Lease, and repair any damage to the premises caused thereby at Lessee's
own cost and expense.
27. Name. It is hereby agreed that the name "Besaw's" or "Besaw's Caf" or any
variation of the name "Besaw's" shall at all times be and remain the sole and exclusive
property of lessor. Lessor grants to lessee the right to use the name "Besaw's Cafe" at the
location known as 2301 NW Sayler St., solely in conjunction with lessee's restaurant at that
address, for the term of this lease, as extended, and not otherwise. The name may be used in
all normal activities associated with the operation of the proposed restaurant as an allowed use
under the terms of the lease and any extensions thereof; however, the right to use the name
shall terminate with the termination of the lease.
Restriction on Assignment and Sub-Letting. Regarding the provisions of
28.
Paragraph 6 of the form Lease, it is expressly understood that the prohibition against
assignment or subletting without consent shall apply to any sale of a controlling interest in
Lessee's business. Moreover, no consent in one instance shall prevent the provision from
applying to a subsequent instance. Any assignment or subletting made without consent will,
at Lessor's option, terminate this Lease.
Insurance Requirements. In addition to the provisions of Paragraph 11 of the
29.
form Lease, Lessee shall be required to adequately insure its own fixtures and inventory from
casualty, including fire, and adequately to insure its business against losses incident to
interruption thereof. In the event of serving alcoholic beverages as part of its business to
provide liquor liability insurance thereof. Lessee shall provide to Lessor a copy of insurance
policy and Lessor shall be named as an additional insured. ,
Hold-Over Tenancy/ Rental Rate. Notwithstanding the provisions of the
30.
"Holding Over" paragraph for the form Lease, any successor month-to-month tenancy created
by the holding over shall be on the same terms, covenants, and agreements as for the original
Lease term, excepting for the month-to-month nature,and.excepting that the basic rental may
be raised up to 150% of the rental for the last month of the prior Lease term.
30.1 Subordination, in General. Lessee hereby agrees that this Lease shall be and
hereby is subordinate to the lien of any mortgages or deed of trust in any amount now or
hereafter placed on or against the land and/or improvements by Lessor, of which the Leased
Premises are a part, without the necessity of execution and delivery to Lessor of any further
instrument on the part of Lessee to effectuate such subordination.
30.2 Subordination Agreement. Lessee agrees to execute promptly on request such
further instruments evidencing such subordination of this Lease to the lien of any such
mortgages or deeds of trust, as may reasonably be required by the Lessor.
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Exhibit 1 - CE John Properties LLC Answer


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30.3 Options for Extension. Provided that Lessee shall not at any time be in default
of any provision hereof, the term of the Lease may be extended, at the option
performance
in
of the Lessee, for one further term of five years. Such option to extend shall be exercised by
the Lessee by giving written notice as otherwise provided for in this Lease to the Lessor not
less than 180 days prior to the expiration of the-then-existing term.
30.4 Conditional Option and Term of Extension Term. The extension term shall be
same terms and covenants as provided in this Lease for the initial terrn, except for
the
upon
rental rate for' extended term as, set forth below. The payment of all additional rent and other
charges required to be made by the Lessee as provided in this Lease for the initial term shall
continue to be made during the extended term. Such renewal lease shall require the further
deposit of the increased 'amounts necessary to constitute full payment of the first and last
month's rental under the renewal term, plus a security deposit equal to the amount of the last '
month's rent during the renewal term. Lessee's option to extend and all rights of extension
hereunder are conditioned upon Lessee's full, complete and timely performance of all terms
and conditions of this Lease, and any default by Lessee in performance of any of those terms
and conditions during the initial term shall automatically, without any notice by Lessor,
terminate said option to extend and all rights of extension hereunder. Further, and termination
of this Lease during the initial term shall terminate all rights of extension hereunder.
30.5 Rental Rate Under Extended Term. The basic rent for each year during the
renewal term shall be the then-current and projected fair rental value of the Leased Premises,
as improved. "Fair Rental Value" shall be determined according to generally-accepted real.
estate appraisal techniques exclusively indexed by compilation and comparison of the most
recently negotiated rental rates for other retail store fronts on Northwest 21st and Northwest
23td Avenues, between Burnside and Northwest Vaughn Streets. If the parties are unable to
agree upon such "Fair Rental Value' for each year of the renewal term, within 20 days of the
expiration date of the original term, they shall. promptly resolve such dispute by arbitration in
the manner provided for in this Lease. In no event shall the rental rate under the extended
term be less than the monthly rate for the last year of this lease.
30.6 Arbitration. If the Lessor and Lessee are unable to agree on the amount of the
basic rent for the renewal term by the date which is 120 days prior to. the beginning of the
renewal term, then the Lessor and Lessee shall each in writing select a list of three potential
appraisers, and submit the same to the other party within five days thereafter. On receipt of
the list of the other, each party shall appoint one from the list submitted from the other as his
"approved" appraiser within five days and so notify the other party. The two appraisers so
appointed shall forthwith meet and determine the basic rent for each year of the renewal term
based upon the then current and projected "Fair Rental Value of the Leased Premises, as
improved. "Fair Rental 'Value shall be determined according to generally accepted real
estate appraisal techniques but, for purposes of arbitrating Fair Rental Value under this Lease,
the appraisers shall make their appraisals exclusively by compilation and comparison of the
most recently negotiated rental rates for other retail store fronts on Northwest 21st and
Northwest 23rd Avenues, between Burnside and Vaughn Streets. In the event the two
appraisers so appointed are unable to agree on the basic rents within 10 days from the date of
their first meeting, then they shall in writing immediately appoint by mutual agreement a third
appraiser, and the majority of the three appraisers so appointed shall determine the basic rent
for each year within the renewal period within a period of ten days from the appointment of
the third appraiser in accordance with the criteria set forth above. In the event either party

Page 6

Addendum to Lease

Exhibit 1 - CE John Properties LLC Answer


Page 11 of 25

Case 3:15-cv-00749-BR

Document 6

Filed 05/08/15

Page 36 of 65

fails to select a list of appraisers or appoint an appraiser from the other's list within the
requisite time or the two appraisers fail to mutually agree upon a third appraiser within the
requisite time, then either party may, by application, have such appraiser appointed by the
Presiding Judge of Multnomah County Circuit Court. The appraiser so appointed shall, in all
instances, be licensed real estate appraisers, or, in the alternative, licensed real estate
brokers/salesmen employed as commercial leasing agents by recognized, major real estate
brokerage firms; shall reside within a radius of 25 miles of the Leased Premises; and shall be
persons familiar with both Northwest Portland and commercial, in particular, retail, leases.
The appraisers shall reduce to writing and deliver to Lessor and Lessee a statement of the
applicable basic rent so determined for each year of the renewal term, and such determination
of basic rent shall be binding and conclusive upon Lessor and Lessee. It is further agreed that
Lessor and Lessee shall each pay one-half the cost and expense involved in any appraisal,
including but not limited to the payment of appraiser's fees.
31.1 Estoppel Certificate. Lessee shall, promptly upon request from the Lessor,
execute, acknowledge, and deliver to the Lessor a statement: (a) certifying that this Lease is
unmodified, and in full force and effect, or, if modified, stating the nature of such
modification and certifying that this Lease, as so modified, is in full force and effect, and the
day to which rent and other charges are pain in advance, if any, and (b) acknowledge that
there are not, to such party's knowledge, any uncured defaults on the part of the Lessor
hereunder, or specifying such defaults, if any are claimed. Any such statement may be
conclusively relied on by a prospective purchaser or encumbrancer of the property.
31.2 Attornment. Lessee, in the event of any voluntary or involuntary transfer of
Lessor's interest in said premises, shall attorn to the transferee upon any such transfer,
whether by sale or foreclosure, and recognize such transferee as the Lessor under this Lease.
31.3 Landlord's Right to Entry. Notwithstanding any contrary provision of
Paragraph 5 of the form Lease, Lessor and Lessor's agents.may retain and use a pass key to
the Leased Premises to enable them to inspect, exhibit, work on, or repair the said premises or
the building shell, from time to time. Except in the case emergencies, Lessor shall give
reasonable advance notice to Lessee to arrange for a mutually-convenient time to conduct any
such inspection, exhibit, work or repair.
32.1 Exterior Areas of Premises. Lessor retains ownership of patio area along NW
23rd Ave. Lessor -may enter into a separate two year, lease with Lessee to use said patio as
described in Exhibit B in the attached map for outside seating.. Lessee shall comply with all
terms of the separate lease agreement and shall pay additional compensation pursuant to the
terms of the lease agreement for patio area.
32.2 Off Street Parking. Lessee represents that off street parking shall not be a part of
premises leased to lessee and lessor retains rights to all offsite parking. Lessor may enter into
a separate two year lease agreement with Lessee to use off street parking property owned by
Lessor. Lessee shall comply with all tennis and conditions of separate lease agreement for off
street parking and shall pay additional compensation to Lessor pursuant to the terms of the
lease agreement for the off street parking.

Page 7

Addendum to Lease

Exhibit 1 - CE John Properties LLC Answer


Page 12 of 25

Case 3:15-cv-00749-BR

Document 6

Filed 05/08/15

Page 37 of 65

32.3 Trade Name. In addition to the provisions of paragraph 27, Lessee agrees upon
termination of lease that the trade name "BesaW's" or "Besaws Cafe or any variation of the
name "Besaw's" shall revert to lessor and that lessee will discontinue to use trade name
"Besaw's" or "Besaw's Cafe or any variation of "Besaw's" and will execute any documents
to transfer trade name to lessor including "Besaw's" or "Besaw's Cafe" or any variation
thereof. Lessee further agrees to change its corporate name to a name other than "Besaw's or
Besaw's Caf, Inc." or any variation thereof upon termination of the lease or in the event that
Lessee is no longer leasing the above described premises.
33. Notices. Unless subsequently changed, all notices to be provided under this
Lease shall be sent to the respective parties at the following addresses:
LESSOR:

905 N Harbor Dr., #17


Portland OR 97217

LESSEE:

2301 NW Savier
Portland OR. 97210

LESSOR:

LESSEE:

Jones Group Associates


An Oregon Limited Partnership

Besaw's Caf, Inc.

ra cane easley

chard G. Beasely

Page 8

Addendum to Lease

Exhibit 1 - CE John Properties LLC Answer


Page 13 of 25

Case 3:15-cv-00749-BR

Document 6

Filed 05/08/15

Page 38 of 65

UCC FINANCING STATEMENT

FOLLOW INSTRUCTIONS (front and back) CAREFULLY


A. NAME & PHONE OF CONTACT AT FILER [optional)

Donald P,. Roach

503-228-7306

B. SEND ACKNOWLEDGMENT TO: (Name and Address)

[ Donald P. Roach
Attorney at Law
140 SW Arthur, Suite 200
Portland OR 97201

THE ABOVE SPACE IS FOR FILING OFFICE USE ONLY


1. DEBTOR'S EXACT FULL LEGAL NAME - insert only one debtor name (la or lb) - do not abbreviate or combine names
la. ORGANIZATION'S NAME
OR

Besawls Cafe, Inc., an Oregon Corporation


lb. INDIVIDUAL'S LAST NAME

lc. MAILING ADDRESS

FIRST NAME

MIDDLE NAME

SUFFIX

CITY

STATE

POSTAL CODE

COUNTRY

OR

97210

Portland

2301 NW Savier St.


ADD'L INFO RE
ORGANIZATION
DEBTOR

le. TYPE OF ORGANIZATION lf. JURISDICTION OF ORGANIZATION

USA

lg. ORGANIZATIONAL 10.40, if any

EJNONE

Oregon

corpotation

'2. ADDITIONAL DEBTOR'S EXACT FULL LEGAL NAME - insert only one debtor name (2a or 2b) -do not abbreviate or combine names
2a. ORGANIZATION'S NAME
OR

FIRST NAME

2b. INDIVIDUAL'S LAST NAME

CITY

2c. MAILING ADDRESS

Portland

2301 NW Savier
ADM INFO ltE
ORGANIZATION
DEBTOR

2d.

MIDDLE NAME

SUFFIX

STATE

POSTAL CODE

COUNTRY

OR

97210

USA

Geraldine

Beasley

2e. TYPE OF ORGANIZATION 21. JURISDICTION OF ORGANIZATION

2g. ORGANIZATIONAL ID #, h eny


ONONE

3. SECURED PARTY'S NAME (or NAME of TOTAL ASSIGNEE OF ASSIGNOR S/P) - insert only one secured party name (3a or 3b)
3a, ORGANIZATIONS NAME

Jones Group Associates


um 3b. INDIVIDUAL'S LAST NAME

FIRST NAME

MIDDLE NAME

SUFFIX

.
CITY

3c. MAILING ADDRESS

905 N. Harbor Dr., 117

STATE

Portland

' POSTAL CODE

OR

97217

COUNTRY

USA

4. This FINANCING STATEMENT covers the following collateral:

A11 trade fixtures (except dishwasher), restaurant equipment and furnishings'


now owned or hereafter acquired and.all substitutions, replacements and
accessories thereto located at 2301 Ng Savier St., Portland OR 97210
and more fully set forth in the attached Exhibit A.

5. ALTERNATIVE DESIGNATION ta appNcJable):


8.

0 LESSEE/LESSOR

El CONSIGNEE/CONSIGNOR

0 BAILEE/BAJLOR

ri This FINANCING STATEMENT Is to be filed [for record) (or recorded) m the REAL ESTATE RECORDS,
"" Attach Addendum flf applicable)

SELLERIBUYER

7.

AG. LIEN

0 NON-UCC FILING

See Instruction Debtor(s)

8. OPTIONAL FILER REFERENCE DATA

401 FILING OFFICE COPY NATIONAL UCC FINANCING STATEMENT (FORM UCC1) (REV. 8/02)

FORM No. UCC-1


OA
Stevens-Ness Law Publishing Co.

Exhibit 1 - CE John Properties


LLCwww.stevertsness.com
Answer
Portland, OR
Page 14 of 25

Case 3:15-cv-00749-BR

Document 6

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Page 39 of 65

EXHIBI4 A

Desk
)
File Cabinet 2:
Shelf (1) Office
Beer Cooler
Cash Drawer
Walk-in Racks (3)
Shelving Units (5)
. ,)
;
Ceiling Fan Fixture (2

Three w Freezers
Stove Cleaning Pcs.
24" Griddle Mira.alKillerey
6 Burner Stove, 2 Oven,
uipment
oiler (36") and Stainless Eq
Ember Glow Electric Br
Stand
ble
3 Compartment Steam Ta
60" Sandwich Table
Reach In (True)
:.

er
Espresso Machine & Grind
tem
Micros Cash Register Sys
Custom Dessert Case

36" Heat Lamp


Kettle
6 Gal. Convection Steam
Equipment Stand
t . Set (Veggie sink)
Stainless Sink & Fauce
Stainless Ice Bin
Soup Warmer
PAGE 1 - EXHIBIT A
Exhibit 1 - CE John Properties LLC Answer
Page 15 of 25

Case 3:15-cv-00749-BR

Document 6

Filed 05/08/15

Page 40 of 65

Dinner Plates
Salad Plates
Dessert Plates
Soup Bowls
Soup Cups
Pasta Bowls
Black Bowls
Flatware
Champagne Glasses
Coffee Mugs
Brandy Glasses
Pop Glasses
Water Glasses
Juice Glasses
Martini Glasses
Rocks Glasses
8-oz. Glasses
Irish Coffee

Bloody Mary Glasses


Knives/Knife Rack
Microwave
Ice Machine
Water Pitchers
Iced Tea Pitchers
Coffee Pots
Coffee Warmers
Garbage Cans
PAGE 2 - EXHIBIT A
Exhibit 1 - CE John Properties LLC Answer
Page 16 of 25

Case 3:15-cv-00749-BR

Document 6

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Page 41 of 65

Bullets
Butter/Jam Holders
Scales
Cutting Boards
EitchenAid & Attachments
1/9 Pans
1/6 Pans
1/3 Pans
1/2 Pans
.2/3 Pans
Hotel Pans
Sheet Pans
Baking Equipment
Stainless Bowls
Large Storage Containers
Easel
Slide Order Rack
Toasters
Salad Spinner
Flour Bin
Line Food Cart
ce
D

ktr

4 P

Meat Slicer (Globe)


Robot Coupe & Attachments
Sherry Glasses
Wine Glasses
PAGE 3 - EXHIBIT A
Exhibit 1 - CE John Properties LLC Answer
Page 17 of 25

Case 3:15-cv-00749-BR

Document 6

Filed 05/08/15

Page 42 of 65

Serving Trays
Sugar Holders
Syrup Holderf
Salt & Peppers

res
Hanging Light Fixtu
d Stands. (13)
Mahagony Tables an
Chairs .(.441-

5J

Outdoor Tables

clai-

Outdoor Chairs
Outdoor Cart.
Rubber Mats
Walk-in Shelving
Work Table
Glass & Dish Racks
Mop Bucket & Mops
et
. Wait Station Cabin
Coat Rack
Pots
Sauce Pans
Saute Pans
Egg Pans
Steel Pans
s
Ladles, Spoons, Tong
Strainers
Whisks
Bleach .Buckets
A
.PAGE 4 - EXHIBIT

Exhibit 1 - CE John Properties LLC Answer


Page 18 of 25

Case 3:15-cv-00749-BR

Document 6

Filed 05/08/15

Page 43 of 65

Clock
Bus Tubs
Brooms
Misc. Utensils
Wooden Book Case
Two Telephones

d to:
including, but not limite
Leasehold Improvements
ion
23rd Street Window Addit
Door
Back Window Addition and
cture & Awning)
Back Patio Awning (Stru
ent & Extension)
Front Awning (Replacem
per
Fixtures (Toilet Paper, Pa
Replacement of Bathroom
ns)
Fa
p Dispensers, Exhaust
Towel, Dispensers, Soa
rrors
Addition of Bathroom Mi
hind Cooks Line
Stainless Steel Work Be
n (Cooks Line)
Rehabing of Exhaust Fa
and Upgrade
Ansel System Relocation
s
Kitchen Walls and Counter
Reconstruction of Open
(Cooks Line)
ter
Bar Shelving Under Coun
Construction of Back
hts
r Lig
Shelving & Glass for Ba
Prep Kitchen
Shelf Construction in
h Area
Stainless Work around Dis
a
Glass Racking in Dish Are
New Compressor Walk-in
oler
New Compressor Beer Co
tem
Reconditioned H-VAC Sys
r Refrigeration
New Condenser/Fan Back Ba
Basement Shelving

PAGE 5 - EXHIBIT A
Exhibit 1 - CE John Properties LLC Answer
Page 19 of 25

Case 3:15-cv-00749-BR

Document 6

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Page 44 of 65

LEASE GUARANTY
Richard G. Beasley and Geraldine Beasley ("Guarantor") irrevocably and unconditionally
guarantees to Jones Group Associates ("Lessor") the full and prompt payment and performance
of all of the obligations of lease between Besaw's Cafe, Inc. ("Lessee") and Jones Group
Associates (Lessor). Upon Lessor's demand,'Guarantor will immediately pay and perform the
then-due Obligations.
Guarantor is directly liable for the payment and performance of the Obligations of Lessee.
Lessor may exercise Lessor's remedies against Guarantor without making a demand, instituting
an action, or exercising or exhausting Lessor's remedies against Lessee or any collateral.
This Guaranty will not be affected by: (i) Lessor's 'release of Lessee or any collateral that may
secure the payment and performance of any of the Obligations; (ii) Lessor's amendment of any
agreement evidencing, guaranteeing, or securing any of the Obligations; (iii) Lessor's waiver of
a breach of a provision of any agreement evidencing, guaranteeing, or securing any of the
Obligations; (iv) Lessor's extension or postponement of the due date of any of the Obligations;
(v) the death, dissolution, or insolvency of Lessee; or (vi) the Obligations becoming
unenforceable against Lessee for any reason, including but but limited to the application of
bankruptcy, insolvency, or other similar laws for the benefit of creditors.
Guarantor waives all rights to terminate this Guaranty before the Obligations are fully paid and
performed. This Guaranty will be automatically reinstated to the extent that any payment or
performance of the Obligations is rescinded or must otherwise be restored by Lessor for any
reason, including but not limited to the application of bankruptcy, insolvency, or other similar
laws for the benefit of creditors.
Guarantor waives demand, presentment for payment, notice of dishonor or nonpayment, protest,
notice of protest, and lack of diligence in collection with respect to the Obligations. No waiver
will be binding on Lessor unless it is in writing and signed by Lessor. Lessor's waiver of a
breach of a provision of this Guaranty or any agreement evidencing, guaranteeing, or securing
any of the Obligations will not be a waiver of any other provision or a waiver of a subsequent
breach of the same provision. Lessor's failure to exercise any remedy under this Guaranty or
any agreement evidencing, guaranteeing, or securing any of the Obligations will not be
considered a waiver by Lessor of Lessor's right to exercise the remedy.
Time is of the essence with respect to all dates and time periods in this Guaranty.
This Guaranty is governed by the laws of the State of Oregon, without giving effect to any
conflict-of-law principle of any jurisdiction. If any arbitration or litigation is instituted to
interpret, enforce, or rescind this Guaranty, including but not limited to any proceeding brought
under the United States Bankruptcy Code, the prevailing party on a claim will be entitled to

1 LEASE GUARANTY
Exhibit 1 - CE John Properties LLC Answer
Page 20 of 25

Case 3:15-cv-00749-BR

Document 6

Filed 05/08/15

Page 45 of 65

recover with respect to the claim, in addition to any other relief awarded,the prevailing party's
reasonable attorney's fees and other fees, costs, and expenses of every kind, including but not
limited to the costs and disbursements specified in ORCP 68 A(2), incurred in connection with
the arbitration, the litigation, any appeal or petition for review, the collection of any award, or the
enforcement of any order, as determined by the arbitrator or court.
Guarantors:
Richard G. Beasley
DATE:

3/3dos--

I
I
4e1D
Guarantor

/Al

Geraldine Beasley
DATE

AA

(MAK;

Guarantor

2 - LEASE GUARANTY
Exhibit 1 - CE John Properties LLC Answer
Page 21 of 25

Case 3:15-cv-00749-BR

Document 6

Filed 05/08/15

Page 46 of 65

MEMORANDUM OF AGREEMENT FOR LEASE


Jones Group Associates
5419 SW Viewpoint Terrace
Portland OR 97201
Lessor
Besaw's Cafe, Inc.
Lessee
After recording return to:
Donald P. Roach
140 SW Arthur, Suite 200
Portland OR 97201
Caf,
day of March, 2005, Jones Group Associates, as Lessor, and Besaw's
Whereas, on. the
are
ses
premi
which
Caf
w's
Besa
n as
Inc., as Lessee, entered into a written lease for the premises know
and
nce,
refere
orated hereto by this
described on Exhibit A attached hereto, which Exhibit is incorp
may extend the lease for one term of
Whereas, the said lease provides that the Lessees thereunder
ded,
five years, and the parties hereto desire that the lease be so exten
n, the parties agree as follows:

Therefore, in consideration of the mutual promises contained herei

for aperiod of five years to


The lease of the premises described in'Exhibit A is extended
to end at Midnight on May 31, 2010. The
commence immediately after Midnight on June 1, 2005, -and
rent during the period of this lease shall be as follows:
June 1, 2005 through. May 31, 2006
June 1, 2006 through May 31, 2007
June 1, 2007 through May 31, 2008
June 1, 2008 through May 31, 2009
June 1, 2009 through May 31, 2010
TOTAL BASE RENT:
(triple net)

$2,857.00 per mo. =


$2,943.00 per mo. =
$3,031.00 per mo. =
$3,122.00 per mo.
$3,215.00 per mo. =

$34,284.00
$35,316.00
$36,372.00
$37,464.00
$38,580.00
$182,016, 00

Exhibit 1 - CE John Properties LLC Answer


Page 22 of 25

Case 3:15-cv-00749-BR

Document 6

Filed 05/08/15

Page 47 of 65

only one
Lessee understands the original lease and this Memorandum grant
extension or option to extend the term of the lease.
DATED: March

ti

, 2005

Stewart Jo
General Partner, Jones Group Associates

DATED: March

2005

Marianne Jones
General Partner, Jones Group Associates

Title of Besaw's Officer

Exhibit 1 - CE John Properties LLC Answer


Page 23 of 25

Case 3:15-cv-00749-BR

Document 6

Filed 05/08/15

Page 48 of 65

*A portion of the building commonly known as "Desaws"


located at the northwest corner of Northwest Sayler and
Northwest 23rd Avenue, Lot 4; Block 312, COUCH'S ADDITION,
also known as 2301.Northwest Sevier Street, Portland,
Oregon, the portion of the building constituting the
demised premises being shown on the map attached hereto
as Exhibit "A", and consisting of approximately 1500
square feet of main floor space and approximately 576
square feet of basement space.

EXHIBIT A

Exhibit 1 - CE John Properties LLC Answer


Page 24 of 25

Case 3:15-cv-00749-BR

5-- XJ-11671T

Document 6

Filed 05/08/15

Page 49 of 65

eA A

.4
.0.

pt

2 -5 C>

7". -

NI,V1. SAW!

7.-ere2"

sT

Exhibit 1 - CE John Properties LLC Answer


Page 25 of 25

Case 3:15-cv-00749-BR

Document 6

Filed 05/08/15

Page 50 of 65

Exhibit 2 - CE John Properties 65 LLC Answer


Page 1 of 7

Case 3:15-cv-00749-BR

Document 6

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Exhibit 2 - CE John Properties 65 LLC Answer


Page 2 of 7

Case 3:15-cv-00749-BR

Document 6

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Exhibit 2 - CE John Properties 65 LLC Answer


Page 3 of 7

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Document 6

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Exhibit 2 - CE John Properties 65 LLC Answer


Page 4 of 7

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Document 6

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Exhibit 2 - CE John Properties 65 LLC Answer


Page 5 of 7

Case 3:15-cv-00749-BR

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Exhibit 2 - CE John Properties 65 LLC Answer


Page 6 of 7

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Document 6

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Exhibit 2 - CE John Properties 65 LLC Answer


Page 7 of 7

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EXHIBIT
3

Exhibit 3 - CE John Properties 65 LLC Answer


Page 1 of 5

Case 3:15-cv-00749-BR

Document 6

Filed 05/08/15

Page 58 of 65

ASSIGNMENT AND ASSUMPTION OF LEASES


THIS ASSIGNMENT AND ASSUMPTION OF LEASES (this "Agreement") is made and
'day of November, 2011 (the "Effective Date") by and between JONES GROUP
entered into as of this
ASSOCIATES ("Assignor") and C.E. JOHN PROPERTIES 65, LLC ("Assignee"), which has accepted
an assignment of the buyer's interest under the Purchase Agreement from C.E. JOHN COMPANY, INC.
Recitals:
Assignor and Assignee are parties to that certain Purchase and Sale Agreement dated as
A.
as amended (the "Purchase Agreement"), pursuant to which Assignee has agreed to
2011,
of February 11,
purchase, and Assignor has agreed to sell, among other things, the Property, on the terms and conditions
set forth therein. Capitalized terms used herein without definition shall have the respective meanings set
forth in the Purchase Agreement.
In conjunction with the closing of the transactions contemplated by the Purchase
B.
Agreement, Assignor desires to assign and convey the Leases to Assignee, and Assignee desires to accept
such assignment and assume Assignor's obligations thereunder, pursuant to and on the terms set forth in
this Agreement.
Agreements:
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants of the parties
herein and in the Purchase Agreement, the parties agree as follows:
forth
set
Assignment. On and as of the Effective Date, Assignor hereby assigns, transfers and
1.
conveys to Assignee all of Assignor's rights and interests as lessor in, to and under the leases of the
Property identified on the attached Exhibit A (collectively, the "Leases"), including without limitation and
without warranty and indemnification all of Assignor's rights in and to the trade names "Besaw's" and
"Besaw's Caf" under the lease between Assignor and Tuatara Enterprises, Inc. Assignor further
quitclaims and assigns to Assignee any rights Assignor may otherwise have in and to such trade names.
Acceptance and Assumption. Assignee hereby accepts the assignment pursuant to
2.
Section 2, and hereby assumes, and agrees to perform, all obligations of the lessor under the Leases
arising from and after the Effective Date.
3.

Indemnities.

By Assignor. Assignor agrees to pay, indemnify, and hold harmless Assignee


3.1
from and against any and all claims, losses, liabilities and expenses (including reasonable attorneys' fees)
arising out of any failure of Assignor to perform any obligation of the lessor under the Leases which
relates to the period prior to the Effective Date.
By Assignee. Assignee agrees to pay, indemnify, and hold harmless Assignor
3.2
from and against any and all claims, losses, liabilities and expenses (including reasonable attorneys' fees)
arising out of any failure of Assignee to perform any obligation of the lessor under the Leases which
relates to the period after the Effective Date.
Attorneys' Fees. If a suit, action, or other proceeding of any nature whatsoever (including
4.
any proceeding under the U.S. Bankruptcy Code) is instituted in connection with any controversy arising

Exhibit 3 - CE John Properties 65 LLC Answer


Page 2 of 5

Case 3:15-cv-00749-BR

Document 6

Filed 05/08/15

Page 59 of 65

out of this Agreement or to interpret or enforce any rights hereunder, the prevailing party shall be entitled
to recover its attorneys', paralegals', accountants' or other experts' fees and all other fees, costs and
expenses actually incurred and reasonably necessary in connection therewith, as determined by the court
at trial or on any appeal or review, in addition to all other amounts provided by law.
5.
Binding Effect. This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first
above written.
Assignor:

JONES GROUP ASSOCIATES,


an Oregon general partnership

Mari ' e E. Jones, arner


By:
,Stewarty.fones, Partner
Assignee:

C.E. JOHN PROPERTIES 65, LLC,


an Oregon limited liability company
By: CEJ HOLDINGS LLC,
a Washington limited liability
company, its Managing Member
By: C.E. John Company, Inc.,
a Washington corporation,
its Manager
By:
Robert A. Hinnen, President

[Acknowledgments on next page]

Exhibit 3 - CE John Properties 65 LLC Answer


Page 3 of 5

Case 3:15-cv-00749-BR

STATE OF OREGON
County of Multnomah

Document 6

Filed 05/08/15

Page 60 of 65

)
) ss.
)

The foregoing instrument was acknowledged before me on this /"-day of November,


2011 by Marianne E. Jones, a Partner of Jones Group Associates, an Oregon general partnership,
on behalf of the partnership.
Notary Public for Oregon
My commission expires:

STATE OF OREGON
County of Multnomah

)
) ss.
)

OFFICIAL SEAL

MAVIS J KIMBALL

NOTARY PUBLIC-OREGON

COMMISSION NO. 436277


MY COMMISSION
MIRES MAR. 9, 2013

The foregoing instrument was acknowledged before me on this lea-day of November,


ip,
2011 by Stewart R. Jones, a Partner of Jones Group Associates, an Oregon general partnersh
on behalf of the partnership.
Notary Public for Oregon
My commission expires:
OFFICIAL SEAL

STATE OF WASHINGTON

) ss.

MAVIS J KIMBALL
NOTARY PUBUC-OREGON
COMMISSION NO. 4362T1
MY COMMISSION EXPIRES MAR. 9, 2013

County of Clark
day of November, 2011, before me personally appeared Robert A. Hinnen, to
On this
and
me known to be the President of C.E. John Company, Inc., the corporation that executed the within
Properties
John
C.E.
of
Member
Managing
foregoing instrument on behalf of CEJ Holdings LLC, as the
limited
65, LLC, who acknowledged the said instrument to be the free and voluntary act and deed of said
authorized
was
he
that
stated
liability company, for the uses and purposes therein mentioned, and on oath
to execute the said instrument.
IN WITNESS WHEREOF,Ihave hereunto set my hand and affixed my official seal the
day and year first above written.
JOYCE M. WITT

NOTARY PUBLIC

STATE OF WASHINGTON
COMMISSION EXPIRES
OCTOBER 30, 2014

-ry ,Iblic for Washington


ission Expires: l0/99)/
y C

j:\23rd & savier (besaw's)Megal\closing\assignment of leases final.doe

Exhibit 3 - CE John Properties 65 LLC Answer


Page 4 of 5

Case 3:15-cv-00749-BR

Document 6

Filed 05/08/15

Page 61 of 65

EXI4BIT A
Leases
Lease dated 07/01/2007 with Liza Rietz for premises at 2305 N.W. Savier Street
1.
store).
(apparel
Lease dated 04/01/2010 with Jean Dugan dba NW Wellness Center for premises
2.
Avenue (wellness center).
23rd
at 1715 N.W.
3.
(residence).

Lease dated 04/27/2010 with Liza Rietz for premises at 2319 N.W. Savier Street

Lease dated 05/01/2010 with Joanne Rollins dba Art of Framing for a parking
4.
space at the Property.
Lease dated 05/12/2008 with Aimee Miller for premises at 2311 N.W. Savier
5.
Street (residence).
Lease dated 04/01/2010 with Stephanie Ryan for premises at 1715 N.W. 23rd
6.
Avenue (residence).
Lease dated 03/30/2005 with Tuatara Enterprises, Inc. for premises at 2301 N.W.
7.
Savier Street (Besaw's restaurant).
Lease dated 03/30/2005 with Tuatara Enterprises, Inc. for premises between 2301
8.
N.W. Savier Street and 1715 N.W. 23rd Avenue (Besaw's patio).
Lease dated 03/30/2005 with Tuatara Enterprises, Inc. for 11 parking spaces at
9.
the Property (Besaw's parking).

Exhibit 3 - CE John Properties 65 LLC Answer


Page 5 of 5

Case 3:15-cv-00749-BR

Document 6

Filed 05/08/15

Page 62 of 65

EXHIBIT
4

Exhibit 4 - CE John Properties LLC Answer


Page 1 of 4

Case 3:15-cv-00749-BR

Document 6

Filed 05/08/15

Page 63 of 65

TENANT ESTOPPEL CERITHCATE


FOR
BESAW'S CAFE RESTAURANT LEASE
TO:

Jones Group Associates ("Landlord") and C.E. John Company, Inc.


("Buyer")

FROM:

Tuatara Enterprises, Inc. ("Tenant")

Re:
Lease, dated or referred to as March 30, 2005 and May
2005, between
Tenant's predecessor, Besaw's Caf, Inc. and Jones Group Associates for certain real
property located at 2301 NW Savier Street, Portland, Oregon 97210 (the "Premises").
1.
Tenant has been advised that Landlord will assign the lease to Buyer at the
closing of Buyer's pending purchase of Landlord's property which includes the Premises.
Tenant hereby certifies to Buyer that the folloWing information regarding the lease and
the Premises is accurate as of the date set forth below:
2.
On or about June 23, 2005 Landlord and Tenant agreed to an assignment and
assumption of Tenant's interest in the lease to Tuatara Enterprises, Inc. Tuatara
Enterprises, Inc. is the current Tenant under the lease.
3.
Except as set forth in paragraph 4 below a true, correct and complete copy of the
referenced lease is attached to this Certificate as Exhibit A (the "Lease"):
3.1

Besaw's Caf, Inc. Restaurant Lease;

3.1.1 Addendum to Besaw's Caf, Inc. Restaurant Lease.


3.1.2 Tenant Assignment and Assumption of Lease to Tuatara
Enterprises, Inc.
4.
The Lease is in full force and effect and has not been modified, changed, altered
or amended in any respect and it is the only Lease or other agreement between Tenant
and Landlord with respect to the Premises except as follows;
4.1. While no written Addendum has been signed by Landlord and Tenant, by
informal agreement the following understanding is effective;
4.1.1 The Lease expires May 31, 2015;
increase m rentfor-the period from June 1, 2010 to May 31, 2015
under the Lease is subject to the following agreethent:

*1727Any

Page 1 of 3 Tenant Estoppel Certificate Jones Group Associates/Besaw's Cafe Restaurant Lease

21466/243910

Exhibit 4 - CE John Properties LLC Answer


Page 2 of 4

Case 3:15-cv-00749-BR

Document 6

Filed 05/08/15

Page 64 of 65

4.1.2.1 The parties to the Lease have agreed to delay negotiations


for any rent increase until after the current pending sale of the
Premises either closes or is terminated.
4.1.2.2 Neither Landlord nor Tenant is deemed to have waived
any right granted in the Lease.
4.1.2.3 The delay in negotiating the rent increase will not
prejudice either the Landlord or Tenant at any time from exercising
their right in the Lease to implement the appraisal procedure.
4.1.2.4 Until such time as the rent increase shall be determined
the Tenant and Landlord shall continue to perform all obligations
in the Lease.and.Tenant shall continue to pay the same rent as due
and payable for the month of May 2010.
4.1.2.5 The rent increase shall be effective January 1, 2011 and
not before. Tenant shall have sixty (60) days after determination
of any rent increase to pay the accumulated increase for the period
of January 1, 2011 to the date of such determination.
5.
Tenant has accepted possession of and now occupies the Premises and, subject to
paragraph 4, is paying the rent stipulated in the Lease.
6.
The fixed minimum or base rent currently being paid under the Lease is as
follows:
6.1
Three Thousand Two Hundred and Fifteen Dollars and NO/100
($3,215.00) per month plus monthly pro-rated amount for property taxes and
reimbursement for insurance which the Landlord and Tenant are in the process of
adjusting.
7.
Except for the pending adjustment of property taxes and insurance all rental
payments and other charges due and payable by Tenant under the Lease as of the date
hereof have been paid in full. No rental payments or other charges under the Lease have
been pre-paid for more than one (1) month.
8.
Under the Lease the Landlord is holding a security deposit in the amount of One
Thousand Dollars and NO/100 ($1,000.00).
9.
Tenant is not in default under the Lease. To the best of the Tenant's knowledge,
Landlord is not in default under the Lease. Tenant has no existing defenses against the
enforcements of this Lease by Landlord, and Tenant is not entitled to any free rent, any

Page 2 of 3 Tenant Estoppel Certificate Jones GrOup Associatesn3esaw's Caf Restaurant Lease

21466/243910

Exhibit 4 - CE John Properties LLC Answer


Page 3 of 4

Case 3:15-cv-00749-BR

Document 6

Filed 05/08/15

Page 65 of 65

credits, offsets or deductions in rent, or any other leasing concessions or inducements


with respect to the Premises, except as may be expressly set forthin the Lease.
Other than as set forth herein Tenant has not entered into any sublease,
10.
assignment or other agreement transferring any of its interest in the Lease or Premises.
Landlord has granted tenant an oral revocable, non exclusive license for use of
11.
Seller's adjacent property at 2325 NW Savier Street for Besaw's employee pedestrian
access for Besaw's installation and maintenance of portable planting beds for herbs. No
fee for license. (See attached general drawing for location of planting beds)
This Certificate is given with the understanding that Buyer will rely on the truth
of the matters stated above in connection with Landlord's assignment of the Lease to
Buyer.
DATED this

day of

, 2011.
TUATARA

ES, INC.

Page 3 of 3 Tenant Estoppel Certificate Jones Group Associates/Sesaw's Cafe Restaurant Lease

21466/243910

Exhibit 4 - CE John Properties LLC Answer


Page 4 of 4

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