SECOND EXTENSION AGREEMENT
DATE: Effective as of August 28, 1998
PARTIES: Tigard-Tualatin School District 23J "TTSD"
Eagle Hardware & Garden, Inc. "Eagle"
A. TTSD and Eagle entered into an Agreement to Lease dated April 30,
1997, (the "Agreement") covering certain real property in Tigard, Oregon (the
"10.5-acre parcel") and a Put to Lease Property dated April 30, 1997, (the
"Put") covering certain other adjoining real property in Tigard, Oregon (the
B. TTSD and Eagle thereafter entered into an extension agreement
("First Extension Agreement") effective August 30, 1997, that confirmed the
exercise of the Put, extended certain of Eagle's deadlines, and required
Eagle to pay a $190,000 nonrefundable fee.
C. In recent weeks, Eagle has concluded that it will take the City of
Tigard several additional weeks to determine if, and under what conditions,
the City will issue the permits and approvals Eagle requires to develop the
10.5-acre parcel and 1.52-acre parcel. As a consequence, Eagle has requested
that TTSD extend certain of its deadlines in accordance with this Second
D. TTSD and Eagle each desire to successfully enter into and conclude
the leases of the 10.5-acre and 1.52-acre parcels from TTSD to Eagle and
understand the need to extend the deadlines as hereinafter described.
In consideration of the mutual covenants set forth below, TTSD and
Eagle agree as follows:
1. EXTENSION REGARDING EAGLE'S SOLE REMAINING CONDITION. Provided that
the $100,000 is remitted to TTSD in accordance with Section 3 below, the
August 29, 1998, deadline for Eagle's waiver or satisfaction of the condition
set forth in Section 3(b)(iii) of the Agreement is hereby extended until
10 a.m. on November 2, 1998.
2. CLOSING. Provided that the $100,000 is remitted to TTSD in
accordance with Section 3 below, (a) the Closing shall occur at or before
5 p.m. on November 2, 1998, and (b) the dates of September 19, 1997, October
20, 1997, and November 21, 1997, set forth in Section 8 of the Agreement are
hereby modified to the
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effect that the sole specified date for the Closing is "at or before 5 p.m.
on November 2, 1998."
3. PAYMENT OF ADDITIONAL NONREFUNDABLE FEE. First American Title
Insurance Company of Oregon is currently holding no less than $110,000 cash
in escrow for this transaction. Eagle shall have until 5 p.m. on September
1, 1998, to cause First American to remit $100,000 of the $110,000 to TTSD as
a nonrefundable fee designed solely to compensate TTSD for postponing the
deadlines as described in this Second Extension Agreement and agreeing to
keep the 10.5-acre parcel and 1.52-acre parcel off the market between August
29, 1998, and November 2, 1998. (TTSD shall cooperate with Eagle in causing
First American to remit the $100,000 to TTSD on or before September 1, 1998.)
Eagle agrees that this fee is not a penalty, that this fee is fair and
reasonable compensation for postponing the deadlines as described above and
agreeing to keep the property off the leasehold market, and that this fee is
nonrefundable. Provided that the $100,000 is remitted to TTSD by September 1,
1998, and the Closing occurs in accordance with the Agreement (as modified by
the First Extension Agreement and by this Second Extension Agreement), TTSD
shall credit the $100,000 to Eagle as prepaid rent for the 10.5-acre parcel.
If Eagle fails to cause the $100,000 to be remitted to TTSD by 5 p.m. on
September 1, 1998, the Agreement and Put shall have no further force or
4. SUPPLEMENTAL EXTENSION FEE. At Closing, the parties shall
calculate a supplemental extension fee by assuming that they had closed on
October 17, 1998, and computing the ground rent that would have accrued under
the two ground leases from October 17, 1998, through the actual date of
Closing. That amount shall then be divided in half, and Eagle shall remit
that sum (i.e., the imputed ground rent divided by two) to TTSD at Closing as
a supplemental extension fee. The supplemental extension fee is in addition
to the sum described in Section 3 above and shall not be credited as prepaid
5. REMAINDER OF AGREEMENT. In all other respects, the terms and
conditions of the Agreement and the Put (as previously modified by the First
Extension Agreement) shall remain in full force and effect.
TIGARD-TUALATIN SCHOOL DISTRICT 23J EAGLE HARDWARE & GARDEN, INC.
Patricia N. Biggs
By /s/ Patricia N. Biggs By /s/ Paul B. Morris
Chair of the School Board Paul B. Morris
Russell A. Joki
By /s/ Russell A. Joki
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