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EXHIBIT 10.20
LEASE
LANDLORD SIERRA EQUITIES, INC.
TENANT MESA GENERAL HOSPITAL, INC.
DATED AS OF JULY 29, 1977
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1. Defined Terms.
Each reference in this Lease to any of the following terms
shall incorporate the data stated for that term. Other terms are as defined in
the Lease.
Landlord: Sierra Equities, Inc., a California corporation
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Tenant: Mesa General Hospital, Inc., an Arizona corporation
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Street Address of Premises
(paragraph 2): 000 Xxxxx Xxxx Xxxxx, Xxxx, Xxxxxxx 00000
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Term (paragraph 3): 120 months
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Commencement Date August 1, 1977
(paragraph 3): ---------------------------------------------------
Fixed Rent (paragraph $57,170 / month
4(a)): ---------------------------------------------------
Permitted Uses
(paragraph 5) ---------------------------------------------------
Landlord's Address 0000 Xxxxxx Xxxxxx Xxxx., Xxxxxx Xxxx, XX 00000
(paragraph 16(h)): ---------------------------------------------------
Tenant's Address 000 Xxxxx Xxxx Xxxxx, Xxxx, Xxxxxxx 00000
(paragraph 16(h)): ---------------------------------------------------
Real Estate
Broker/Commission
Responsibility
(paragraph 38(t)): None.
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2. Leased Premises.
Landlord hereby leases to Tenant, and Tenant hereby leases from
Landlord, subject to the terms and conditions contained herein, (a) that
certain real property located at the street address set forth in paragraph 1
hereof and more particularly described in Exhibit A attached hereto and
incorporated herein by this reference (the "Property") and (b) the improvements
thereon (the "Improvements"). The Property and the Improvements are sometimes
hereinafter referred to collectively as the "Premises".
3. Term.
The Term of this Lease, which shall be for the period set forth in
paragraph 1 above, shall commence on the Commencement Date set forth in
paragraph 1 above.
4. Rent.
(a) Tenant shall pay Landlord as fixed rent for the Premises a sum
equal to the fixed Rent set forth in paragraph 1 on or before the first day of
each and every month during the Term of this Lease.
(b) On or before the first day of each and every month of each
thirty-six (36) month period (the "Adjustment Period"), the first of which
shall commence August 1, 1980, in addition to the Fixed Rent due pursuant to
subparagraph (a) above, Tenant shall pay as additional rent an additional
amount (the "Adjustment") to be determined in accordance with the variations,
if any, in the costs of living as shown by the Consumer Price Index for all
Urban Consumers, as published by the Bureau of Labor Statistics, United States
Department of Labor, or any successor agency (the "CPI") The Adjustment for
each month of each Adjustment Period shall be an amount equal to fifty per cent
(50%) of the difference between (i) the product obtained by multiplying the
Fixed Rent by a fraction, the numerator of which shall equal the CPI reported
for the calendar month of May immediately prior to the first day of such
Adjustment Period and the denominator of which shall equal the CPI reported for
May, 1977 and (ii) the Fixed Rent. The computation of the Adjustment for each
month of each Adjustment Period shall be made without regard to whether any
Adjustment was payable with respect to any preceding Adjustment Period. In no
event shall the calculation of the amount of the Adjustment operate to reduce
the total rent due pursuant to this paragraph 3 below the Fixed Rent. In the
event that the necessary CPI figures are not available to compute the
Adjustment upon the commencement of any Adjustment Period, Tenant shall
continue to pay the Fixed Rent plus the Adjustment in effect, if any, for the
prior Adjustment Period (the "Tentative Adjustment") until such CPI figures
become available, at which time the appropriate Adjustment for each month of
such Adjustment Period shall be determined. Immediately following such
determination, either Landlord shall refund to Tenant thc amount by which the
sum of all Tentative Adjustments actually paid during such Adjustment Period
exceeds the sum of all Adjustments properly payable during such Adjustment
Period, or Tenant shall pay to Landlord the amount by which the sum of all
Adjustments properly payable during such Adjustment Period exceeds the sum of
all Tentative Adjustments actually paid during such Adjustment Period. In the
event the CPI is no longer published, Landlord and Tenant shall determined
another index of similar nature showing changes in the cost of living to be
used to calculate the Adjustment due Landlord. If Landlord and Tenant cannot
agree on the selection of an index, or if Landlord and Tenant disagree as to
the computations called for in this subparagraph (b), any disagreed matters
shall then be resolved by arbitration in the county in which the Premises are
located, in accordance with the then rules of the
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American Arbitration Association. The Fixed Rent and any Adjustments are
sometimes collectively referred to as the "Rent."
(c) Rent for any period during the Term which is for less than one
month shall be a pro rata portion of the monthly installment. Rent shall be
payable, without deduction or offset, in lawful money of the United States to
Landlord at the address stated herein or to such other persons or at such other
places as Landlord may designate in writing.
(d) This Lease is what is commonly called a "net lease", it being
understood that Landlord shall receive the [illegible] of any and all
impositions, taxes, liens, charges or expenses of any nature whatsoever in
connection with its ownership and leasing of the Premises. In addition to the
Rent provided in this paragraph, Tenant shall pay to the parties respectively
entitled thereto all impositions, taxes, insurance premiums, operating charges,
costs and expenses which arise or may be contemplated under any provisions of
this Lease during the Term. All of such charges, costs and expenses shall
constitute additional rent, and upon the failure of Tenant to pay any of such
costs, charges or expenses, Landlord shall have the same rights and remedies as
otherwise provided in this Lease for the failure of Tenant to pay Rent. It is
the intention of the parties hereto that Tenant shall in no event be entitled
to any abatement of or reduction in Rent payable hereunder, except as expressly
provided herein. Any present or future law to the contrary shall not alter this
agreement of the parties.
5. Use:
(a) The Premises shall be used and occupied only for the Permitted
Uses set forth in paragraph 1 above and for no other purpose.
(b) Tenant shall, at Tenant's sole cost and expense, comply with
all present and future laws, ordinances, orders, rules, regulations and
requirements of all federal, state and municipal governments, courts,
departments, commissions, boards, and officers, and any national or local Board
of Fire Underwriters, or any other body exercising functions similar to those
of any of the foregoing, foreseen or unforeseen, ordinary as well as
extraordinary, which may be applicable to the Premises and the sidewalk, curbs
and vaults adjoining the Premises or to the use or manner of use of the
Premises, whether or not such law, ordinance, order, rule, regulation or
requirement shall necessitate structural changes or improvements, or the
removal of any encroachments or projections, ornamental, structural or
otherwise, onto or over the streets or sidewalks adjacent to the Premises, or
onto or over other property contiguous or adjacent thereto. Tenant shall obtain
any required certificate of occupancy with respect to its use of the Premises,
the Improvements and the Property within thirty (30) days from the Commencement
Date and shall deliver a copy thereof to Landlord within such thirty (30) day
period. Tenant shall not use or permit the use of the Premises in any manner
that will tend to create waste or a nuisance.
(C) Tenant hereby accepts the Premises subject to all applicable
zoning, municipal, county and state laws, ordinances and regulations governing
and regulating the use of the Premises and subject to all liens, claims and
encumbrances currently existing against the Premises or any part thereof, and
accepts this Lease subject thereto and to all matters disclosed thereby and by
any exhibits attached hereto. Tenant acknowledges that neither Landlord nor
Landlord's agents have made any representations or warranties as to the
Premises, including without limitation, any representation or warranty as to
condition or fitness of the Improvements or the suitability of the Improvements
for the conduct of Tenant's business.
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6. Maintenance and Repairs.
(a) Tenant shall during the Term keep in good order, condition and
repair, the Premises (including the Improvements and any and all alterations
and additions made by Tenant pursuant to the provisions hereof), structural or
non-structural, and all adjacent sidewalks, landscaping, driveways, parking
lots, fences and signs located in the areas which are adjacent to or included
with the Premises. Landlord shall incur no expense nor have any obligation of
any kind whatsoever in connection with maintenance of the Premises, and Tenant
expressly waives the benefits of any statute now or hereafter in effect which
would otherwise afford Tenant the right to make repairs at Landlord's expense
or to terminate this Lease because of Landlord's failure to keep the Premises
in good order, condition and repair.
(b) On the last day of the Term, or on any sooner termination of
this Lease, Tenant shall surrender the Premises to Landlord in the same
condition as when received, broom clean, ordinary wear and tear alone excepted.
Tenant shall repair any damage to the Premises occasioned by the removal of
Tenant's alterations and improvements (including, without limitation, its trade
fixtures, furnishings and equipment) which repair shall include, without
limitation, the patching and filling of holes and repair of structural damage.
(c) If Tenant fails to perform Tenant's obligations under this
paragraph, Landlord may at its option enter upon the Premises after ten (10)
days prior written notice to Lessee, and put the same in good order, condition
and repair and the [illegible] the rate of ten percent (10%) per annum shall
become due and payable as additional rental to Landlord together with Tenant's
next monthly Rent payment. Nothing herein shall imply any duty upon the part of
Landlord to do any such work and the performance thereof by Landlord shall not
constitute a waiver of Tenant's default in failing to perform the same.
Landlord may, during the progress of any such work in or on the Premises, keep
and store therein all necessary materials, tools, supplies and equipment.
Landlord shall not be liable for the inconvenience, annoyance, disturbance,
loss of business or other damage of Tenant by reason of making such repairs or
the performance of any such work, or on account of bringing materials, tools,
supplies or equipment into or through the Premises during the course thereof
and the obligations of Tenant under this Lease shall not be affected thereby.
7. Alterations and Additions.
(a) Tenant shall not, without Landlord's prior written consent,
make any alterations, improvements, additions, or utility installations (which
term "utility installations" shall include ducting, power panels, fluorescent
fixtures, space heaters, conduits and wiring) in, or about the Premises, except
for nonstructural alterations to the Premises costing less than One Thousand
Dollars ($1,000) in the aggregate over any one (1) year period. As a condition
to giving such consent, Landlord may require that Tenant agree to (i)
[illegible] additions or utility installations at the expiration of the Term
and restore the Premises to their prior condition or, in the alternative, (ii)
require that such alterations, improvements, additions or utility installations
shall become the property of Landlord and shall be left by Tenant upon the
expiration of the Term. As a further condition to giving such consent, Landlord
may require Tenant to provide Landlord, at Tenant's sole cost and expense, lien
and completion bonds in an amount equal to one and one-half (1-1/2) times the
estimated cost of such improvements to insure Landlord against any liability
for mechanics' and material-men's liens and to insure completion of the work.
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(b) Tenant shall pay, when due, all claims for labor or materials
furnished or alleged to have been furnished to or for Tenant at or for use on
or in connection with the Premises, which claims are or may be secured by any
mechanics' or materialmen's lien against the Premises or any interest therein.
Tenant shall give Landlord not less than ten (10) days notice prior to the
commencement of any work on the Premises, and Landlord shall have the right to
post notices of non-responsibility in or on the Premises as provided by law.
(c) Unless Landlord requires their removal as set forth in
subparagraph (a) above or otherwise consents to such removal, all alterations,
improvements, additions and utility installations which may be made on or to
the Premises shall become the property of Landlord and remain upon and be
surrendered with the Premises at the expiration of the Term. Notwithstanding
the provisions of this subparagraph (c). Tenants machinery and equipment other
than that which is affixed to the Promises so that it cannot be removed without
material damage to the Premises, shall remain the property of Tenant and may be
removed by Tenant subject to the provisions of paragraph 8(c) above.
8. Insurance.
(a) Tenant at its sole cost and expense, and for the mutual
benefit of Landlord and Tenant as named insureds, shall maintain comprehensive
general liability insurance on an "occurrence basis" against claims for
"personal injury," including without limitation, bodily injury, death or
property damage, occurring upon, in or about the Premises and on, in or about
the adjoining sidewalks, streets, and passageways and for all other areas
appurtenant thereto, such insurance to afford immediate minimum protection, at
the time of the inception of this Lease, and at all times during the Term, to a
limit of not less than One Million Dollars ($1,000,000) with respect to
personal injury or death to any one or more persons or to damage to property.
Such insurance shall also include coverage against liability for bodily injury
or property damage arising out of the use, by or on behalf of Tenant, or any
other person or organization, of any owned, non-owned, leased or hired
automotive equipment in the conduct of any and all operations called for under
this Lease. The limits of said insurance shall not, however, limit the
liability of Tenant hereunder.
(b) Tenant, at its sole cost and expense, shall keep the
Improvements insured during the Term for the mutual benefit of Landlord and
Tenant as named insureds, against loss or damage by fire and lightning and
against loss or damage by other risks embraced by coverage, of the type now
known as the broad form of extended coverage, including but not limited to
fire, riot and civil commotion, vandalism and malicious mischief, special
extended perils (all risk) and sprinkler leakage, and against such other risks
or hazards as Landlord may from time to time reasonably designate, in amounts
sufficient to prevent Landlord or Tenant from becoming a co-insurer under the
terms of the applicable policies, but in any event in an amount not less than
the full replacement cost of the Improvements and the Personal Property,
without deduction for physical depreciation, and with not more than One
Thousand Dollars ($1,000) deductible from the loss payable for any casualty.
The policies of insurance carried in accordance with this paragraph shall
contain a "Replacement Cost Endorsement." Such full replacement cost shall be
determined from time to time, but not more frequently than once in any twelve
(12) consecutive calendar months (except in the event of substantial changes or
alterations to the Improvements undertaken by Tenant as permitted hereunder)
upon the written request of Landlord by an appraiser, architect or contractor
who shall be mutually and reasonably acceptable to Landlord and Tenant. A copy
of any such determination shall promptly be sent to Landlord, and subject to
the approval of such determination by Landlord, the insurance maintained in
this paragraph shall be adjusted to the new full
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replacement cost. Said insurance shall provide for payment for loss thereunder
to Landlord or, at Landlord's request, to the holder of any mortgage or deed of
trust on the Premises.
(c) Insurance required hereunder shall be by companies rated AAA
or better in "Best's Insurance Guide" licensed to do business in the state in
which the Promises are located and acceptable to Landlord and the holder of any
mortgage or deed of trust on the Premises or any part or portion thereof.
Tenant shall deliver to Landlord copies of policies of such insurance or
certificates evidencing the existence and amounts of such insurance with loss
payable clauses satisfactory to Landlord. No such policy shall be cancellable
or subject to reduction of coverage or other modification except after thirty
(30) days written notice to Landlord. Tenant shall, within ten (10) days of the
expiration of such policies, furnish Landlord with renewals of "binders"
thereof, or Landlord may order such insurance and charge the cost thereof to
Tenant, which amount shall be payable by Tenant upon demand. Each such policy
or certificate therefor issued by the insurer shall to the extent obtainable
contain (i) a provision that no act or omission of Tenant which would otherwise
result in forfeiture or reduction of the insurance therein provided shall
affect or limit the obligation of the insurance company to pay the amount of
any loss sustained and (ii) an agreement by the insurer that such policy shall
not be cancelled without at least thirty (30) days prior written notice by
registered mail to Landlord. Tenant shall not do or permit to be done anything
which shall invalidate the insurance policies referred to herein. If Tenant
shall fail to procure and maintain any insurance required to be maintained by
it by virtue of any provision of this paragraph, Landlord may, but shall not be
required to, procure and maintain the same, but at the expense of Tenant.
(d) Landlord and Tenant each hereby waive any and all rights of
recovery against the other, or against the officers, employees, agents and
representative of the other, for loss of or damage to such waiving party or its
property or the property of other under its control to the extent that such
loss or damage is insured against under any insurance policy in force at the
time of such loss or damage. Tenant shall, upon obtaining the policies of
insurance required hereunder, give notice to the insurance carrier or carriers
that the foregoing mutual waiver of subrogation is contained in this Lease.
9. Indemnity; Exemption of Landlord from Liability.
(a) In addition to any other obligations of Tenant hereunder,
including the obligations of Tenant to provide insurance, Tenant shall
indemnify and hold Landlord harmless from and against any and all claims
arising from Tenant's use of the Premises, or from the conduct of Tenant's
business or from any activity, work or things done, permitted or suffered by
Tenant in or about the Premises or elsewhere and shall further indemnify and
hold Landlord harmless from and against any and all claims arising from any
breach or default in the performance of any obligation on Tenant's part to be
performed under the terms of this Lease, or arising from any negligence of
Tenant, or any of Tenant's agents, contractors, or employees, and from and
against all costs, attorneys' fees, expenses and liabilities incurred in the
defense of any such claim or any action or proceeding brought thereon; and in
case any action or proceeding be brought against Landlord by reason of any such
claim, Tenant upon notice from Landlord shall defend the same at Tenant's
expense by counsel satisfactory to Landlord. Tenant, as a material part of the
consideration to Landlord for Landlord's execution of this Lease, hereby
assumes all risk of damage to property or injury to persons in, upon or about
the Premises arising from any cause and Tenant hereby waives all claims in
respect thereof against Landlord.
(b) In addition to any other obligation of Tenant hereunder,
including any obligation of Tenant to provide insurance, hereby agrees that
Landlord shall not be liable for injury to Tenant's
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business or any loss of income therefrom or for damage to the goods, wares,
merchandise or other property of Tenant, Tenant's employees, invitees,
customers, or any other person in or about the Premises, nor shall Landlord be
liable for injury to the person of Tenant or Tenant's employees, agents or
contractors, whether such damage or injury is caused by or results from fire,
steam, electricity, gas, water or rain, or from the breakage, leakage,
obstruction or other defects of pipes, sprinklers, wires, appliances, plumbing,
air conditioning or lighting fixtures, or from any other cause, resulting from
conditions arising upon the Premises, or from other sources or places, and
regardless of whether the cause of such damage or injury or the means of
repairing the same is inaccessible to Tenant.
10. Damage or Destruction; Obligation to Rebuild.
In the event that during the Term the Improvements are damaged or
destroyed, partially or totally, from any cause whatsoever, whether or not such
damage or destruction is covered by any insurance required to be maintained
under this Lease, then Tenant shall repair, restore, and rebuild the Premises
to their condition existing immediately prior to such damage or destruction and
this Lease shall continue in full force and effect. Such repair, restoration
and rebuilding (all of which are herein called the "repair") shall be commenced
within a reasonable time after such damage or destruction and shall be
diligently prosecuted to completion. There shall he no abatement of Rent or of
any other obligation of Tenant hereunder by reason of such damage or
destruction. The proceeds of any insurance maintained under paragraph 8 hereof
shall be made available to Tenant for payment of the costs and expenses of the
repair; provided, however, that such proceeds may be made available to Tenant
subject to reasonable conditions including, but not limited to, architects'
certification of costs and retention of a percentage of such proceeds pending
final notice of completion. Landlord may require that Tenant provide, at
Tenant's sole cost and expense, lien and completion bonds in an amount equal to
one and one-half (1-1/2) times the estimated cost of repairs to insure against
mechanics' or materialmen's liens arising out of the repair and to insure
completion of the repair. In the event that the insurance proceeds are
insufficient to cover the cost of the repair, then any amount in excess thereof
required to complete the repair shall be paid by Tenant.
11. Property Taxes.
(a) Tenant shall pay all "Property Taxes" (as defined below)
applicable to the Premises during the Term. Each payment shall be made at least
ten (10) days prior to the delinquency date of such payment; provided, however,
that if in connection with any financing obtained by Landlord on the Premises
or any portions thereof, Landlord is required to pay into an impound account
any sums due as Property Taxes, then Tenant shall pay such sums to Landlord in
satisfaction of Tenant's obligation to pay such sums due as Property Taxes as
additional rent and without deduction or offset on or before the first day of
each and every month during which said sums are required to be impounded.
Tenant shall promptly furnish Landlord with evidence satisfactory to Landlord
that Property Taxes have been paid. If any Property Taxes due with respect to
the Premises shall cover any period of time prior to or after the expiration of
the Term, Tenant's share of such Property Taxes shall be equitably prorated to
cover only the period of time within the tax fiscal year during which this
Lease shall be in effect If Tenant shall fail to pay any Property Taxes,
Landlord shall have the right, but not the obligation, to pay the same, in
which case Tenant shall repay such amount to Landlord with Tenant's next Rent
installment.
(b) As used herein, the term "Property Taxes" shall include any
form of general or special assessment, license fee, commercial rental tax,
levy, penalty, or tax (other than inheritance or estate taxes) imposed by any
authority having the direct or indirect power to tax, including any
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city, county, state or federal government, or any school, agricultural,
lighting, drainage or other improvement district, or any part or parts thereof,
or against any legal or equitable interest of Landlord in the Premises or any
part thereof or against Landlord's right to rent or other income therefrom (but
exclusive of taxes levied on or computed by reference to Landlord's net income
as a whole), or against Landlord's business of leasing the Premises, it being
the intention of the parties hereto that the Rent to be paid hereunder shall be
paid to Landlord absolutely net, without deduction of any nature whatsoever,
foreseeable or unforeseeable.
(c) If the Premises are not separately assessed, Tenant's
liability shall be an equitable proportion of the Property Taxes for all of the
land and improvements included within the tax parcel assessed, such proportion
to be determined by Landlord from the respective valuations assigned in the
assessor's work sheet or such other information as may be reasonably available.
Landlord's reasonable determination thereof, in good faith, shall be
conclusive.
(d) Tenant shall pay prior to delinquency all taxes assessed
against and levied upon trade fixtures, furnishings, equipment and all other
personal property of Tenant contained on the Premises or elsewhere. When
possible, Tenant shall cause such trade fixtures, furnishings, equipment and
all other personal property to be assessed and billed separately from the
Premises.
(e) As between the parties hereto, Tenant alone shall have the
duty of attending to, making or filing any declaration, statement or report
which may be provided or required by law as the basis of or in connection with
the determination, equalization, reduction or payment of any Property Taxes
which are to be borne or paid or which may become payable by Tenant under the
provisions of this paragraph and Landlord shall not be or become responsible to
Tenant therefor, nor for the contents of any such declaration, statement or
report.
12. Condemnation.
(a) If the Premises or any portion thereof is taken under the
power of eminent domain, or sold under the threat of the exercise of said power
(all of which are herein called "condemnation"), this Lease shall terminate as
to the part so taken as of the date the condemning authority takes title or
possession, whichever first occurs (the "Condemnation Date") and the Rent shall
be reduced (as of the Condemnation Date) as provided below. If (i) more than
ten percent (10%) of the floor area of any building comprising the Improvements
or more than twenty-five percent (25%) of the land area of the Property which
is not occupied by any such building is taken by condemnation, and (ii) as a
result of such taking by condemnation the balance of the Premises remaining
after such condemnation is not reasonably suitable for the use to which the
Premises were being put immediately prior to the condemnation Landlord or
Tenant may, at either's option, to be exercised in writing only within ten (10)
days after Landlord shall have given Tenant written notice of such taking (or
in the absence of such notice, within ten (10) days of the Condemnation Date)
terminate this Lease as of the Condemnation Date. If Landlord or Tenant does
not terminate this Lease in accordance with the foregoing, or in the event that
portion of the Premises taken by condemnation is not sufficiently large so as
to give rise to the right to terminate this Lease as above provided, this Lease
shall remain in full force and effect as to the portion of the Premises
remaining, except that the Fixed Rent shall be reduced (as of the Condemnation
Date) in the proportion that the area taken by condemnation bears to the total
area of the Premises.
(b) Any award for the taking of all or any part of the Premises
under the power of eminent domain or any payment made under threat of the
exercise of such power shall be the property of Landlord, whether such award
shall be made as compensation for diminution in value
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of the leasehold or for the taking of the fee, or as severance damages;
provided, however, that Lessee shall be entitled to any award specifically
attributed by the condemning authority to loss or damage to Tenant's trade
fixtures and removable personal property. In the event that this Lease is not
terminated by reason of such condemnation, Landlord shall, to the extent of
severance damages received by Landlord in connection with such condemnation,
repair any damage to the Premises caused by such condemnation except to the
extent that Tenant has been reimbursed therefor by the condemning authority (in
which event such reimbursement to Tenant shall also be applied to such repair).
Tenant shall pay any amount in excess of such severance damages required to
complete such repair.
(c) If the temporary use of the whole or any part of the Premises
shall be taken by condemnation, the Term shall not be reduced or affected in
any way, and Tenant in such event shall continue to pay in full the rent and
other charges herein reserved, without reduction or abatement, and except to
the extent that Tenant is prevented from so doing by reason of any order of the
condemning authority, shall continue to perform and observe all of the other
covenants, conditions and agreements of this Lease to be performed or observed
by Tenant as though such taking had not occurred. In the event of any such
temporary condemnation Tenant shall, so long as it is otherwise in compliance
with the provisions of this Lease, be entitled to receive for itself any and
all awards or payments made for such use of that portion of the Premises so
taken; provided, however, that Tenant shall repair any and all damages to the
Premises (whether or not covered by any award to Tenant) caused by such
temporary condemnation.
13. Utilities.
Tenant shall pay for all water, gas, heat, light, power, telephone and
other utilities and services supplied to the Premises, together with any taxes
thereon. If any such services are not separately metered to Tenant, Tenant
shall pay a reasonable portion to be determined by Landlord of all charges
jointly metered with other premises, and Landlord's determination thereof, in
good faith, shall be conclusive.
14. Assignment and Subletting.
(a) Tenant shall not voluntarily or by operation of law assign,
transfer, mortgage, sublet, or otherwise transfer or encumber all or any part
of Tenant's interest in this Lease or in the Premises without Landlord's prior
written consent, which Landlord shall not unreasonably withhold. Landlord may
withhold its consent to such assignment, transfer, mortgage, subletting or
other transfer or encumbrance pursuant to the preceding sentence for reasons
including, without limitation, the financial condition of the proposed assignee
or transferee. Any attempted assignment, transfer, mortgage, subletting or
encumbrance without such consent shall be void, and shall constitute a breach
of this Lease. The consent of Landlord to any one assignment, transfer,
mortgage, subletting, or encumbrance shall not be deemed to be a consent to any
subsequent assignment, transfer, mortgage, subletting, or encumbrance. The
transfer of more than twenty-five percent (25%) of the stock or other ownership
interest in Tenant, or the merger or consolidation of Tenant with or into
another firm or entity, shall be deemed to be a transfer of Tenant's interest
under this Lease and shall be subject to the provisions of this subparagraph
(a).
(b) Regardless of Landlord's consent, no subletting or assignment
shall alter the primary liability of Tenant to pay the Rent or release Tenant
of Tenant's obligation to perform all other obligations to be performed by
Tenant hereunder unless Landlord's written consent shall so specifically
provide, and Landlord under no circumstances shall be obligated to release
Tenant from
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any such liability. The acceptance of rent by Landlord from any other person
shall not be deemed to be a waiver by landlord of any provision hereof.
(c) In the event that Landlord shall consent to a sublease or
assignment under subparagraph (a) above, Tenant shall pay Landlord's reasonable
attorneys' fees not to exceed Five Hundred Dollars ($500) incurred in
connection with the giving of such consent.
15. Defaults; Remedies.
(a) Defaults. The occurrence of any one or more of the following
events shall constitute a default and breach of this Lease by Tenant:
(i) The vacating or abandonment of the Premises by
Tenant;
(ii) The failure by Tenant to make any payment of Rent or
any other payment required to be made by Tenant hereunder, as and when due,
where such failure shall continue for a period of three (3) days after written
notice thereof from Landlord to Tenant;
(iii) The failure by Tenant to observe or perform any of
the covenants, conditions or provisions of this Lease to be observed or
performed by Tenant, other than described in subparagraph (ii) above, where
such failure shall continue for a period of ten (10) days after written notice
hereof from Landlord to Tenant; provided, however, that if the nature of
Tenant's default is such that it is capable of being cured but more than ten
(10) days are reasonably required for its cure, then Tenant shall not be deemed
to be in default if Tenant commences such cure within such ten (10) day period
and thereafter diligently prosecutes such cure to completion; or
(iv) The making by Tenant of any general assignment for
the benefit of creditors; the filing by or against Tenant of a petition to have
Tenant adjudged a bankrupt or of a petition for liquidation or reorganization
or rehabilitation or arrangement or rearrangement under any law relating to
bankruptcy whether now existing or hereafter enacted (including, without
limitation, any petition filed by or against Tenant under any one or more of
the following Chapters of the Federal Bankruptcy Act: Chapters 1-6 or Chapter
10 or Chapter 11 or Chapter 12 or Chapter 13); the adjudication of Tenant as a
bankrupt or insolvent; the appointment of a trustee or receiver to take
possession of all or substantially all of Tenant's assets located at the
Premises or of Tenant's interest in this Lease, where possession is not
restored to Tenant within twenty (20) days; the attachment, execution or other
judicial seizure of substantially all of Tenant's assets located at the
Premises or of Tenant's interest in this Lease, where such seizure is not
discharged within twenty (20) days. Unless Landlord's express written consent
thereto is first obtained, in no event shall this Lease, or any interest herein
or hereunder or any estate created hereby, be assigned or assignable by
operation of law or by, in or under voluntary or involuntary bankruptcy or
insolvency or reorganization proceedings or otherwise and in no event shall
this Lease or any rights or privileges hereunder be an asset of Tenant under
any bankruptcy or insolvency or reorganization proceedings. Any purported
assignment or transfer in violation of the provision of this subparagraph (iv)
shall constitute a default and breach of this Lease by Tenant and in connection
with any such default and breach Landlord shall have the rights and remedies
described in subparagraph (b) below, including, without limitation, the
election to terminate this Lease. As used in this subparagraph (iv) the words
"bankruptcy or insolvency or reorganization proceedings" shall include any
proceedings under any law relating to bankruptcy whether now existing or
hereafter enacted (including, without limitation, proceedings under any one or
more of the following Chapters of the Federal Bankruptcy Act: Chapters 1-6 or
Chapter 10 or Chapter 11 or Chapter 12 or Chapter 13).
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(b) Remedies.
(i) In the event of any default and breach by Tenant of
any of its obligations under this Lease and notwithstanding the vacation or
abandonment of the Premises by Tenant, this Lease shall continue in effect so
long as Landlord does not expressly terminate Tenant's right to possession in
any of the manners specified in this paragraph and Landlord may, at Landlord's
option and without limiting Landlord in the exercise of any other rights or
remedies which it may have by reason of such default and breach, exercise all
of its rights and remedies hereunder, including, without limitation:
(A) The right to declare the Term ended and to re-enter
the Premises and take possession thereof and remove all persons therefrom, and
Tenant shall have no further claim in or to the Premises or under this Lease;
or
(B) The right without declaring this Lease ended to
re-enter the Premises, take possession thereof, remove all persons therefrom
and occupy or lease the whole or any part thereof for and on account of Tenant
and upon such terms and conditions and for such rent as Landlord may deem
proper and to collect such rent or any other rent that may hereafter become
payable and apply the same as provided in subparagraph (ii) below; or
(C) The right, even though Landlord may have relet the
Premises or brought an action to collect Rent and other charges without
terminating this Lease, to thereafter elect to terminate this Lease and all of
the rights of Tenant in or to the Premises; or
(D) The right, without terminating this Lease, to bring
an action or actions to collect Rent and other charges hereunder which are from
time to time past due and unpaid or to enforce any other provisions of this
Lease imposing obligations on Tenant; it being understood that the bringing of
any such action or actions shall not terminate this Lease unless written notice
of termination is given.
(ii) Should Landlord relet the Premises under the
provisions of subparagraph (b)(i)(B) above, Landlord may execute any
lease either in its own name or in the name of Tenant, but Tenant
hereunder shall have no right or authority whatever to collect any rent
from the new tenant. The proceeds of any such reletting shall first be
applied to the payment of the costs and expenses of reletting the
Premises, including without limitation, reasonable brokerage
commissions and alterations and repairs which Landlord, in its sole
discretion, deems unreasonably necessary and advisable and to the
payment of reasonable attorneys' fees incurred by Landlord in
connection with the retaking of the Premises and such reletting and,
second, to the payment of any indebtedness, other than Rent, due
hereunder including, without limitation, storage charges owing from
Tenant to Landlord. When such costs and expenses of reletting have been
paid, and if there is no such indebtedness or such indebtedness has
been paid, Tenant shall be entitled to a credit for the net amount of
rental received from such reletting each month during the unexpired
balance of the Term, and Tenant shall pay Landlord monthly on the first
day of each month as specified herein such sums as may be required to
make up the rentals provided for in this Lease. Nothing contained
herein shall be construed as obligating Landlord to relet the whole or
any part of the Premises.
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(iii) Should Landlord elect to terminate this
Lease under the provisions of subparagraphs (b)(i)(A) or (C) above, Landlord
shall be entitled to recover immediately from Tenant (in addition to any other
amounts recoverable by Landlord as provided by law), the following amounts:
(A) The worth at the tine of award of
the unpaid rent which had been earned at the time of
termination;
(B) The worth at the time of award of
the amount by which the unpaid rent which would have been
earned after termination until the time of award exceeds the
amount of such rental loss that Tenant proves could have been
reasonably avoided;
(C) The worth at the time of award of
the amount by which the unpaid rent for the balance of the
Term after the time of award exceeds the amount of such
rental loss that Tenant proves could be reasonably avoided;
and
(D) Any other amount necessary to
compensate Landlord for all the detriment proximately caused
by Tenant's failure to perform its obligations under the
Lease or which in the ordinary course of things would be
likely to result therefrom.
For purposes of computing "the worth at the time of the
award" of the amount specified in subparagraph (b)(iii)(C)
above, such amount shall be discounted at the discount rate
of the Federal Reserve Bank of San Francisco at the time of
award. For purposes of computing "the worth at the time of
the award" under subparagraph (b)(iii)(A) and (b)(iii)(B)
above, an interest rate of ten percent (10%) per annum shall
be utilized.
(iv) If Landlord shall elect to re-enter the
Premises as provided above, Landlord shall not be liable for damages by reason
of any reentry. Tenant hereby waives all claims and demands against Landlord
for damages or loss arising out of or in connection with any reentering and
taking possession of the Premises and waives all claims for damages or loss
arising out of or in connection with any destruction of or damage to the
Premises, or for any loss of property belong to Tenant or to any other person,
firm or corporation which may be in or upon the Premises at the tine of such
reentry.
(v) Landlord shall not be deemed to have
terminated this Lease, Tenant's right to possession of the Premises or the
liability of Tenant to pay Rent thereafter to accrue or its liability for
damages under any of the provisions hereof by any reentry hereunder or by any
action in unlawful detainer or otherwise to obtain possession of the Premises,
unless Landlord shall notified Tenant in writing that Landlord has so elected
to terminate this Lease. Tenant agrees that the service by Landlord of any
notice pursuant to the unlawful detainer statutes or comparable statutes of the
state or locality in which the Premises are located and the surrender of
possession pursuant to such notice shall not (unless Landlord elects to the
contrary at the time of or at any time subsequent to the service of such notice
and such election shall be evidenced by a written notice to Tenant) be deemed
to be a termination of this Lease and of Tenant's obligations hereunder. No
reentry or reletting under this paragraph shall be deemed to constitute a
surrender or termination of this Lease, or of any of the rights, options,
elections, powers and remedies reserved by Landlord hereunder, or a release of
Tenant from any of its obligations hereunder, unless Landlord shall
specifically notify Tenant, in writing, to that effect. No such reletting shall
preclude Landlord from thereafter at any time terminating this Lease as herein
provided.
(vi) All fixtures, furnishings, goods, equipment,
chattels or other personal property of Lessee remaining on the Premises at the
time that Landlord takes possession
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thereof may at Landlord's election be stored at Tenant's expense or sold or
otherwise disposed of by Landlord in any manner permitted by applicable law.
(vii) All rights, options, elections, powers and
remedies of Landlord under the provisions of this Lease are cumulative of each
other and of every other right, option, election, power or remedy which
Landlord may otherwise have at law or in equity and all or any of which
Landlord is hereby authorized to exercise. The exercise of one or more rights,
options, elections, powers or remedies shall not prejudice or impair the
concurrent or subsequent exercise of other rights or remedies Landlord may have
upon a breach and default under this Lease and shall not be deemed to be a
waiver of Landlord's rights or remedies thereupon or to be a release of Tenant
from Tenant's obligations thereon unless such waiver or release is expressed in
writing and signed by Landlord.
(viii) In the event of the exercise by Landlord of
any one or more of its rights and remedies hereunder, Tenant hereby expressly
waives any and all rights of redemption, if any, granted by or under any
present or future laws.
(c) Defaults by Landlord. Landlord shall not be in default under
this Lease unless Landlord fails to perform obligations required of Landlord
within a reasonable time, but in no event later than ten (10) days after
written notice by Tenant to Landlord and to the holder of any first mortgage or
deed of trust covering the Premises whose name and address shall have
theretofore been furnished to Tenant in writing, specifying wherein Landlord
has failed to perform such obligation; provided, however, that if the nature of
Landlord's obligation is such that more than ten (10) days are required for
performance, then Landlord shall not be in default if Landlord commenced
performance within such ten (10) day period and thereafter diligently
prosecutes the same to completion.
(d) Late Charges. Tenant hereby acknowledges that late payment by
Tenant to Landlord of Rent and other sums due hereunder will cause Landlord to
incur costs not contemplated by this Lease, the exact amount of which will be
extremely difficult to ascertain. Such costs include, but are not limited to
processing and accounting charges, and late charges which may be imposed on
Landlord by the terms of any mortgage or trust deed covering the Premises.
Accordingly, if any installment of rent or any other sum due from Tenant shall
not be received by Landlord or Landlord's designee within ten (10) days after
such amount shall be due, Tenant shall pay to Landlord a late charge equal to
ten percent (10%) of such overdue amount. The parties hereby agree that such
late charge represents a fair and reasonable estimate of the costs Landlord
will incur by reason of late payment by Tenant. Acceptance of such late charge
by Landlord shall in no event constitute a waiver of Tenant's default with
respect to such overdue amount, nor prevent Landlord from exercising any of the
other rights and remedies granted hereunder.
16. Miscellaneous.
(a) Estoppel Certificate.
(i) Tenant shall at any time upon not less than ten (10)
days prior written notice from Landlord execute, acknowledge, and deliver to
Landlord a statement in writing 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 date to which the Rent and other charges are paid in advance, if any,
and acknowledging that there are not, to Tenant's knowledge, and uncured
defaults on the part of Landlord hereunder,
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or specifying such defaults if any are claimed. Any such statement may be
conclusively relied upon by any person to whom it shall be delivered by
Landlord including any prospective purchaser or encumbrancer of the Premises or
any part thereof.
(ii) Tenant's failure to deliver such statement within
such time shall be conclusive upon Tenant that this Lease is in full force and
effect, without modification except as may be represented by Landlord; that
there are no uncured defaults in Landlord's performance; and that not more than
one month's Rent has been paid in advance.
(iii) If Landlord desires to finance or refinance the
Premises, or any part thereof, Tenant hereby agrees to deliver to any lender
designated by Landlord such financial statements of Tenant as may be reasonably
required by such lender. Such statements shall include the past three years
financial statements of Tenant. All such financial statements shall be received
by Landlord in confidence and shall be used only for the purposes herein set
forth.
(b) Landlord's Liability. The term "Landlord" as used herein shall
mean only the owner or owners at the time in question of the fee title (or
the lessee's interest in any ground or master lease) to the Premises and in the
event of any transfer of such title, Landlord herein named (and in case of any
subsequent transfers, the then grantor) shall be relieved from and after the
date of such transfer of all liability as respects Landlord's obligations
thereafter to be performed, provided that any funds in the hands of Landlord or
the then grantor at the time of such transfer in which Tenant has an interest
shall be delivered to the grantee. The obligation contained in this Lease to be
performed by Landlord shall, subject as aforesaid, be binding on Landlord's
successors and assigns only during their respective periods of ownership.
(c) Construction. Paragraph captions are solely for the
convenience of the parties and shall not be deemed to or be used to define,
construe, or limit the terms hereof. As used in this Lease, the masculine,
feminine and neuter genders shall be deemed to include the others, and the
singular number shall be deemed to include the plural whoever the context so
requires. The invalidity of any provision of this Lease as determined by a
court of competent jurisdiction shall in no way affect the validity or any
other provision hereof. This Lease shall be governed by the laws of the state
in which the Premises are located.
(d) Interest on Past-due Obligations. Except as expressly herein
provided, any amount due to Landlord not paid when due shall bear interest at
the lesser of (i) ten percent (10%) per annum or (ii) the maximum rate
permitted by law, from the date due until the date such amount is paid. Payment
of such interest shall be made when such amount is paid. Payment of such
interest shall not excuse or cure any default by Tenant under this Lease.
(e) Time of Essence. Time is of the essence of this Lease and all
of the covenants and obligations hereof.
(f) Counterparts. This Lease may be executed in two or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same Lease.
(g) Incorporation of Prior Agreements; Amendments. This Lease
contains all agreements of the parties with respect to any matter mentioned
herein. No prior agreement or understanding pertaining to any such matter shall
be effective. This Lease may be modified in writing only, signed by the parties
in interest at the time of the modification.
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(h) Notices. Any notices, approval, agreements, certifications,
other documents or communications between the parties hereto required or
permitted under this Lease shall be in writing. Any such communications shall
he deemed to have been duly given or served if delivered in hand or forty-eight
(48) hours after deposit in the United States mail, certified or registered,
postage and fees prepaid, return receipt requested, addressed to the parties at
the addresses set forth in paragraph 1 of this Lease. The address to which any
such communications shall be sent may be changed by either party hereto from
time to time by a notice mailed as aforesaid.
(i) Waivers. No waiver by Landlord of any provision hereof shall
be deemed a waiver of any other provision hereof or of any subsequent breach by
Tenant of the same or any other provision. Landlord's consent to or approval of
any act shall not be deemed to render unnecessary the obtaining of Landlord's
consent to or approval of any subsequent act by Tenant. The acceptance of Rent
hereunder by Landlord shall not be a waiver of any preceding breach by Tenant
of any provision hereof, other than the failure of Tenant to pay the particular
Rent so accepted, regardless of Landlord's knowledge of such preceding breach
at the time of acceptance of such Rent.
(j) Recording. Tenant shall not record this Lease without
Landlord's prior written consent and such recordation shall, at the option of
Landlord, constitute a non-curable default of Tenant hereunder. Landlord and
Tenant shall, upon the request of either party, execute, acknowledge and
deliver to the other a "short form" memorandum of this Lease for recording
purposes.
(k) Holding Over. If Tenant remains in possession of the Premises
or any part thereof after the expiration of the Term or sooner termination of
this Lease without the express written consent of Landlord, such occupancy
shell be a tenancy from month to month at a rental equal to one hundred twenty
percent (120%) of the last monthly Rent plus all other charges payable
hereunder, and upon all the terms hereof applicable to a month-to-month
tenancy.
(1) Covenants and Conditions. Each provision of this Lease
performable by Tenant shall be deemed both a covenant and a condition.
(m) Binding Effect. Subject to any provisions hereof restricting
assignment or subletting by Tenant and subject to the provision of subparagraph
(b) above, this Lease shall bind the parties and their personal
representatives, successors end assigns.
(n) Subordination.
(i) This Lease, at Landlord's option, shall be
subordinate to any ground lease, mortgage, deed of trust, or any other
hypothecation for security now or hereafter placed upon the Premises, the
Property or the Improvements, or any part or parts thereof, and to any and all
advances made on the security thereof and to all renewals, modifications,
consolidations, replacements and extensions thereof. If any present or future
mortgagee, trustee or ground lessor shall at any time elect to have this Lease
prior to the lien of its mortgage, deed of trust or ground lease, and written
notice of such election shall be given to Tenant, this Lease shall be deemed
prior to such mortgage, deed of trust, or ground lease, whether this Lease is
dated prior or subsequent to the date of said mortgage, deed of trust or ground
lease or the date of recording thereof.
(ii) Tenant agrees to execute any documents required to
effectuate such subordination or to make this Lease prior to the lien of any
mortgage, deed of trust or ground lease, as the case may be, and failing to do
so within ten (10) days after written demand, does hereby
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make, constitute and irrevocably appoint Landlord as Tenant's attorney in fact
and in Tenant's name, place and stead, to do so.
(o) Attorneys' Fees. If either party brings an action to enforce
the terms hereof or declare rights under this Lease, the prevailing party in
the final adjudication or any such action, on trial or appeal, shall be
entitled to its costs and expenses of suit, including, without limitation, its
actual attorneys' fees, to be paid by the losing party as fixed by the court.
(p) Landlord's Access. Landlord and Landlord's agents shall have
the right to enter the Premises at reasonable times for the purpose of
inspecting the same, showing the same to prospective purchasers or lenders, and
making such alterations, repairs, improvements or additions to the Premises or
the Improvements as Landlord may deem necessary or desirable. Landlord may at
any time place on or about the Premises any ordinary "For Sale" signs and
Landlord may at any time during the last one hundred twenty (120) days of the
Term place on or about the Premises any ordinary "For Lease" signs, all without
rebate of rent or liability to Tenant.
(q) Signs and Auctions. Tenant shall not place any sign upon the
Premises or conduct any auction thereon without Landlord's prior written
consent. Further, Tenant shall erect an exterior, identifying sign in form and
substance satisfactory to Landlord.
(r) Merger. The voluntary or other surrender of this Lease by
Tenant, or a mutual cancellation thereof, shall not work a merger, and shall,
at the option of Landlord, terminate all or any existing subtenancies or may,
at the option of Landlord, operate as an assignment to Landlord of any or all
of such subtenancies.
(s) Joint and Several Liability. Each party signing this Lease as
Tenant shall be jointly and severally liable for the failure on the part of
Tenant to pay any sums due under the terms of this Lease or for the breach by
Tenant or any of the covenants or obligations of Tenant contained herein.
(t) Brokers and Finders. Landlord and Tenant agree that the
execution of this Lease was not incurred or procured through any person, firm
or corporation acting as a broker or finder other than the broker set forth in
paragraph 1 hereof, whose compensation shall be the responsibility of the party
designated in paragraph 1. Each party agrees to hold the other harmless from
any loss, damage, or charge resulting from any claim by any other person, firm
or corporation based upon their having acted as a broker or finder for or in
connection with this transaction on behalf of such party.
IN WITNESS WHEREOF, the undersigned have executed this Lease as of the
date and year first above written.
"LANDLORD" Sierra Equities, Inc., a California corporation
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By: /s/ Xxxxx Xxxxxx, Secty
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"TENANT" Mesa General Hospital, Inc. an Arizona corporation
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By: /s/ Xxx Xxxxxxxx, V.P.
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