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EXHIBIT 10.16
EQUIPMENT SUB-LEASE
EQUIPMENT SUB-LEASE made this __ day of _______ , 19__ (the "Lease"),
by and between Complete Wellness Centers, Inc., a Delaware corporation having
its principal place of business at 000 Xxxxxxxxxxxx Xxxxxx, Xxxxxxxxxx, XX
00000 ("Lessor") and ((CWMC_Name)), a ((State)) chartered professional
corporation having its principal place of business at ((Address1)) ("Lessee").
TERMS AND CONDITIONS OF LEASE
1. LEASE. Lessor hereby leases to Lessee, and Lessee hereby hires and
takes from Lessor the personal property described in Exhibit "A" attached
(hereinafter, with all replacement parts, additions, repairs, and accessories
incorporated therein and/or affixed thereto, referred to as "Equipment") upon
the following terms and conditions.
2. TERMS OF RENTAL.
A. Term. This Lease is for a term to run concurrent with the term of
that certain Integrated Medical Center Management and Security Agreement (the
"Integrated Agreement") dated of even date herewith by and among Lessor,
((CWMC_Name)) and (but in no event for a period of less than one (1) year).
B. Annual Rental. The annual rental payment for the Equipment shall be
$________, payable in arrears, in twelve consecutive monthly installments, plus
applicable taxes thereon, as follows:
Month 1 Month 5 Month 9
---------- ----------- ------------
Month 2 Month 6 Month 10
---------- ----------- ------------
Month 3 Month 11
---------- ------------
Month 7
-----------
Month 4 Month 12
---------- ------------
Month 8
-----------
Thereafter, annual rental payments shall be adjusted for additional one
year terms pursuant to negotiation between the Lessor and the Lessee, but in no
event shall the adjusted rental payment rate be less than the rental rate
described herein.
3. DESTRUCTION OF EQUIPMENT. If any Equipment is totally destroyed, the
liability of the Lessee to pay rent therefor may be discharged by paying to the
Lessor all the rent due thereon, plus all the rent to become due thereon less
the net amount of the recovery, if any, actually received by Lessor from
insurance or otherwise for such loss or damage. Lessor shall not be obligated to
undertake, by litigation or otherwise, the collection of any claim against any
person for loss or damage of the Equipment. Except as expressly provided in this
paragraph, the total or partial destruction of any Equipment, or total or
partial loss of use or possession thereof to Lessee, shall not release or
relieve Lessee from the duty to pay the rent herein provided.
4. NO WARRANTIES BY LESSOR; MAINTENANCE, COMPLIANCE WITH LAWS AND
INSURANCE. LESSOR, NOT BEING THE MANUFACTURER OF THE EQUIPMENT, NOR
MANUFACTURER'S AGENT, MAKES NO WARRANTY OR REPRESENTATION, EITHER EXPRESS OR
IMPLIED, AS TO THE FITNESS, QUALITY, DESIGN, CONDITION, CAPACITY, SUITABILITY,
MERCHANTABILITY OR PERFORMANCE OF THE EQUIPMENT OR OF THE MATERIAL OR
WORKMANSHIP THEREOF, IT BEING AGREED THAT THE EQUIPMENT IS LEASED "AS IS" AND
THAT ALL SUCH RISKS, AS BETWEEN THE LESSOR AND THE LESSEE, ARE TO BE BORNE BY
THE LESSEE AT ITS SOLE RISK AND EXPENSE. Lessee accordingly agrees not to assert
any claim whatsoever against the Lessor based thereon. Lessee further agrees,
regardless of cause, not to assert any claim whatsoever against the Lessor for
loss of anticipatory profits or consequential damages. Lessor shall have no
obligation to install, erect, test, adjust, or service the Equipment. No oral
agreement, guaranty, promise, condition, representation, or warranty shall be
binding; all prior conversations, agreements, or representations related hereto
and/or to the Equipment are integrated herein, and no modification hereof shall
be binding unless in writing signed by Lessor. Lessee agrees, at its own cost
and expense, (a) to pay all shipping charges and other expenses incurred in
connection with the shipment of the Equipment by the Seller to the Lessee; (b)
to pay all charges and expenses in connection with the operation of each item of
Equipment; (c) to comply with all governmental laws, ordinances, regulations,
requirements, and rules with respect to the use, maintenance, and operation of
each item of Equipment; (d) to maintain at all times public liability, property
damage, fire with extended coverage, theft, and comprehensive insurance in an
amount satisfactory to Lessor, protecting Lessor's interest as it may appear,
delivering to Lessor evidence of such insurance coverage; all insurance policies
shall provide that no cancellation thereof shall be effective without 30 days
prior written notice to Lessor, and (e) to make all repairs and replacements
required to be made to maintain the Equipment in good condition, reasonable wear
and tear excepted.
5. TAXES. Lessee agrees that, during the term of this Lease, in
addition to the rent and all other amounts provided herein to be paid, it will
promptly pay all taxes, assessments, and other governmental charges (including
penalties and interest, if any, and fees for titling or registration, if
required) levied or assessed, (a) upon the interest of the Lessee in the
Equipment or upon the use or operation thereof; or on the earnings arising
therefrom, and (b) against Lessor on account of its acquisition or ownership of
the Equipment or any part thereof, or the use or operation thereof or the
leasing thereof to the Lessee, or the rent herein provided for, or the earnings
arising therefrom, exclusive, however, of any taxes based on net income of
Lessor. Lessee agrees to file, in behalf of Lessor, all required tax returns and
reports concerning the Equipment with all appropriate governmental agencies, and
within not more than 45 days after the due date of such filing to send Lessor
confirmation, in form satisfactory to Lessor, of such filing.
6. LESSOR'S TITLE, RIGHT OF INSPECTION, AND IDENTIFICATION OF
EQUIPMENT: Title to the Equipment shall at all times remain in the Lessor and
Lessee will at all times protect and defend, at its own cost and expense, the
title of Lessor from and against all claims, liens, and legal processes of
creditors of the Lessee and keep all the Equipment free and clear from all such
claims, liens, and processes. The Equipment is and shall remain personal
property. Upon the expiration or termination of this Lease: (i) the Lessee at
Lessee's sole expense shall return the Equipment unencumbered to Lessor at the
place where the rent is payable or to such other place as Lessor and Lessee
agree upon, and in the same condition as when received by Lessee, reasonable
wear and tear resulting from use thereof alone excepted, or (ii) in lieu of
returning the Equipment to the Lessor, Lessee agrees that Lessee will, upon
request of Lessor, store the Equipment on Lessee's premises, at an inside
location protected from the weather and elements, without charge to Lessor for a
period of 180 days following the date of expiration or termination of this
Lease. During such storage period Lessee shall not use the Equipment for any
purpose. Upon expiration of such storage period Lessee shall not use the
Equipment for any purpose. Upon expiration of such storage period Lessee will
return the Equipment to the Lessor in accordance with the provisions of (i)
above. Lessor shall have the right from time to time during reasonable business
hours to enter upon the Lessee's premises or elsewhere for the purpose of
confirming the existence, condition, and the proper maintenance of the Equipment
during any period of storage. Lessor shall also have the right to demonstrate
and show the Equipment to others. The foregoing rights of entry are subject to
any applicable governmental laws, regulations and rules concerning industrial
security. Lessee shall, upon the request of Lessor, and at its own expense
firmly affix to the Equipment, in a conspicuous place, such a decal or metal
plate as shall be supplied by Lessor showing Lessor as the owner and lessor of
such Equipment.
7. POSSESSION, PLACE OF USE, AND CHANGES IN LOCATION OF EQUIPMENT. So
long as Lessee shall not be in default under this Lease it shall be entitled to
the possession and use of the Equipment in accordance with the terms of this
Lease. The Equipment shall be used in the conduct of the lawful business of the
Lessee and shall be kept at the address of Lessee set forth above. The Lessee
shall not, without Lessor's prior written consent, remove the Equipment from
such location, part with possession or control of the Equipment or attempt to
purport to sell, pledge, mortgage, or otherwise encumber any of the Equipment or
otherwise
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dispose of or encumber any interest under this Lease.
8. PERFORMANCE OF OBLIGATIONS OF LESSEE BY LESSOR. In the event that
the Lessee shall fail duly and promptly to perform any of its obligations under
the provisions of paragraphs 4, 5, and 6 of this Lease, the Lessor may, at its
option, perform the same for the account of Lessee without thereby waiving such
default, and any amount paid or expense incurred (including reasonable
attorney's fees), penalty, or other liability incurred by Lessor in such
performance, together with interest at the rate of 1 1/2% per month thereon
until paid by the Lessee to the Lessor, shall be payable by the Lessee upon
demand as additional rent for the Equipment.
9. DEFAULT. An event of default shall occur if: (a) Lessee fails to pay
when due any installment of rent and such failure continues for a period of 10
days, (b) Lessee shall fail to perform or observe any covenant, condition, or
agreement to be performed or observed by it hereunder and such failure continues
uncured for 15 days after written notice thereof to Lessee by Lessor, (c) Lessee
ceases doing business as a going concern, makes an assignment for the benefit of
creditors, admits in writing its inability to pay its debts as they become due,
files a voluntary petition in bankruptcy, is adjudicated a bankrupt or an
insolvent, files a petition seeking for itself any reorganization, arrangement,
composition, readjustment, liquidation, dissolution, or similar arrangement
under any present or future statute, law, or regulation or files an answer
admitting the material allegations of a petition filed against it in any such
proceeding, consents to or acquiesces in the appointment of a trustee, receiver,
or liquidator of it or of all or any substantial part of its assets or
properties, or if it or its shareholders shall take any action looking to its
dissolution or liquidation, (d) within 60 days after the commencement of any
proceedings against Lessee seeking reorganization, arrangement, readjustment,
liquidation, dissolution, or similar relief under any present or future state,
law, or regulation, such proceedings shall not have been dismissed, or if within
60 days after the appointment without Lessee's written consent of any trustee,
receiver, or liquidator of it or of all or any substantial part of its assets
and properties, such appointment shall not be vacated, or (e) Lessee attempts to
remove, sell, transfer, encumber, part with possession, or sublet the Equipment
or any item thereof.
Upon the occurrence of an event of default, Lessor shall have all the
rights and remedies provided by applicable law and by this Lease.
Notwithstanding that this agreement is a Lease and title to the Equipment is at
all times in Lessor, Lessor may nevertheless at its option choose those rights
and remedies of a secured party under the Uniform Commercial Code. In addition,
Lessor, at its option, may: (a) declare all unpaid rentals and other sums due
and to become due hereunder immediately due and payable; (b) proceed by
appropriate court action or actions or other proceedings either at law or in
equity to enforce performance by Lessee of any and all covenants of this Lease
and to recover damages for the breach thereof; (c) demand that Lessee deliver
the Equipment forthwith to Lessor at Lessee's expense at such place as Lessor
may designate; and (d) without notice, liability or legal process, enter by
itself and/or its agents into any premises of or under control or jurisdiction
of Lessee or any agent of Lessee where the Equipment may be or by Lessor is
believed to be, and repossess all or any item thereof, disconnecting and
separating all thereof from any other property and using all force necessary and
permitted by applicable law so to do, Lessee hereby expressly waiving all
further rights to possession of the Equipment and all claims for injuries
suffered through or loss caused by such repossession.
Notwithstanding recovery of the Equipment by Lessor, Lessor shall,
nevertheless, also be entitled to recover immediately as liquidated damages for
loss of the bargain and not as penalty any unpaid rent that accrued on or before
the occurrence of the event of the event of default plus an amount equal to the
difference between the present value, as of the date of the occurrence of such
event of default, of the aggregate rent reserved hereunder for the unexpired
term of this Lease and the then present value of the aggregate rental value of
all Equipment for such unexpired term which the Lessor reasonably estimates to
be obtainable for the use of all of the Equipment during such unexpired term. If
any statute governing the proceeding in which such damages are to be proved
specifies the amount of such claim, Lessor shall be entitled to prove as and for
damages for the breach an amount equal to that allowed under such statute. The
provisions of this paragraph shall be without prejudice to any rights given to
the Lessor by such statute to prove for any amounts allowed thereby. Should any
proceedings be instituted by or against Lessor hereunder and/or for possession
of any or all of the Equipment or for any other relief, Lessee shall pay a
reasonable sum as attorney's fees.
No remedy of Lessor hereunder shall be exclusive of any remedy herein
or by law provided, but each shall be cumulative and in addition to every other
remedy.
10. INDEMNITY. Lessee agrees that Lessor shall not be liable to Lessee
for, and Lessee shall indemnify and save Lessor harmless from and against any
and all liability, loss, damage, expense, causes of action, suits, claims, or
judgments arising from or caused directly or indirectly by: (a) Lessee's failure
to promptly perform any of its obligations under the provisions of paragraphs 4,
5, and 6 of this Lease, or (b) injury to person or property resulting from or
based upon the actual or alleged use, operation, delivery, or transportation of
any or all of the Equipment or its location or condition, or (c) inadequacy of
the Equipment, or any part thereof, for any purpose or any deficiency or defect
therein or the use or maintenance thereof or any repairs, servicing or
adjustments thereto or any delay in providing or failure to provide any thereof
or any interruption or loss of service or use thereof or any loss of business;
and shall, at its own cost and expense, defend any and all suits which may be
brought against Lessor, either alone or in conjunction with others upon any such
liability or claim or claims and shall satisfy, pay, and discharge any and all
judgments and fines that may be recovered against Lessor in any such action or
actions, provided, however, that Lessor shall give Lessee written notice of any
such claim or demand.
11. ASSIGNMENT, NOTICES, REMEDIES, AND WAIVERS. This Lease and all
rights of Lessor hereunder shall be assignable by Lessor without Lessee's
consent, but Lessee shall not be obligated to any assignee of the Lessor except
after written notice of such assignment from the Lessor. Without the prior
written consent of Lessor, the Lessee shall not assign this Lease or its
interests hereunder or enter into any sublease with respect to the Equipment
covered hereby, it being agreed Lessor will not unreasonably withhold its
consent to a sublease of the Equipment. All notices relating hereto shall be
delivered in person to an officer of the Lessor or Lessee or shall be mailed
registered to Lessor or Lessee at its respective address above shown or at any
later address last known to the sender. No remedy of Lessor hereunder shall be
exclusive of any other remedy herein or by law provided, but each shall be
cumulative and in addition to every other remedy. A waiver of a default shall
not be a waiver of any other or a subsequent default.
12. FURTHER ASSURANCES. Lessee shall execute and deliver to Lessor,
upon Lessor's request, such instruments and assurances as Lessor deems necessary
or advisable for the confirmation or perfection of this Lease and Lessor's
rights hereunder, including the filing or recording of this agreement at
Lessor's option.
13. LEASE IRREVOCABILITY. This Lease is irrevocable for the full term
hereof and for the aggregate rentals hereinabove reserved and the rent shall not
xxxxx by reason of termination of Lessee's right of possession and/or the taking
of possession by the Lessor or for any other reason, and delinquent installments
of rent shall bear interest at 1 1/2% per month if not prohibited by law,
otherwise at the highest lawful contract rate.
14. RENEWAL. Any renewal privilege shown above shall be exercised by
the Lessee giving the Lessor a notice in writing and paying the Lessor the
amount of the renewal rental, at least 30 days prior to the commencement of the
renewal term of the Lease. Upon such notification and payment, this Lease shall
be renewed for the stated renewal term at the stated renewal rental with the
other provisions and conditions of the Lease continuing unchanged.
15. NO PURCHASE OPTION. Lessee shall have no option to purchase or
otherwise acquire title to or ownership of any of the Equipment and shall have
only the right to use the same under and subject to the term and provisions of
this Lease.
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UNDERSIGNED AGREE TO ALL TERMS AND CONDITIONS SET FORTH ABOVE AND IN WITNESS
WHEREOF, THEY HEREBY EXECUTE THIS LEASE.
Complete Wellness Center, Inc. ((CWMC_Name))
by: by:
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E. Xxxxxx Xxxxxx, President , President
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EXHIBIT "A"
Description of Leased Equipment
OTHER
MAKE KIND MODEL NO. SERIAL NO. PERTINENT I.D.
