Exhibit 10.7
Form of Lease Agreement including Rent Addendum,
Construction Addendum and Memorandum of Lease
_________ #(Site Number)/(City), (County) County, (State)
LEASE AGREEMENT
THIS LEASE AGREEMENT is made and entered into as of (Closing Date), by
and between:
(i) CNL __________, a (State of Registration) (Landlord Entity
Type) with principal office and place of business at ▇▇▇ ▇.
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Landlord"),
and
(ii) (TENANT NAME), a (State of Incorporation) (Tenant Entity
Type), with a mailing address of (Tenant Street Address),
(Tenant Street Address), (Tenant City), (Tenant State) (Tenant
Zip) ("Tenant").
WITNESSETH:
Landlord leases to Tenant, for the purpose of [[developing,
constructing and]] operating a _________ health care facility and for no other
use or purpose whatsoever [[and subject to the terms and conditions of the
Construction Addendum attached hereto]], and Tenant rents from Landlord the
following described premises, (hereinafter "Premises") located at (Site
Address), (City), (County) County, (State) and being more particularly described
in Exhibit "A" attached hereto and made a part hereof, together with all rights
and privileges in and about the Premises as may be necessary or convenient to
Tenant's business, inclusive of all easements benefitting the real property
described in Exhibit "A". Premises shall include all improvements and structures
whether now existing or hereafter constructed thereon.
The following additional stipulations are hereby declared to be
covenants of this Lease and shall, unless otherwise expressly stated, be
applicable at all times throughout the term of this Lease and any extension or
renewal thereof:
1. DEFINITIONS
For purposes of this Lease, the following terms are hereby defined to
mean:
"Effective Date" shall mean the first date set forth at the beginning
of this Lease.
"Landlord" shall mean CNL __________, a (State of Registration)
(Landlord Entity Type), its successors and assigns.
"Lease" shall include this Lease Agreement and all amendments hereto,
if any, entered into from time to time hereafter.
"Lease Year" shall mean a fiscal period beginning on the Effective Date
(and each anniversary thereof) and expiring twelve (12) months
thereafter.
"Rent" shall mean the Rent payable under this Lease as set forth in the
Rent Addendum attached hereto and incorporated herein, and shall
include [[Interim Rent]] and Annual Rent (all as defined in the Rent
Addendum).
2. TERM AND RENT
(a) Term. The term of this Lease shall begin on the Effective Date and
shall expire on a date ________ (__) years thereafter unless previously
terminated or renewed or extended as provided herein.
(b) Rent. Rent shall be due and payable as provided in the Rent
Addendum attached hereto and incorporated herein.
3. ALTERATIONS AND IMPROVEMENTS, INVESTMENT TAX CREDIT, MECHANIC'S LIENS,
LANDLORD'S DISCLAIMER
(a) Tenant shall be permitted to install, use on and about, and remove
from the Premises at any time and from time to time all trade fixtures and other
personal property (exclusive of lighting, electrical, heating and air
conditioning improvements) which are not a component of the building located or
to be located on the Premises (hereinafter referred to as the "Tenant's
Property"), all of which at all times shall remain the property of Tenant with
the right of removal (subject to paragraph (d) below) at the expiration of this
Lease. Trade fixtures shall include: (1) removable decor items and office
equipment; (2) building lettering, signs, sign posts and sign standards; (3)
unattached equipment; and (4) equipment attached to the building by bolts and
screws and/or by utility connections. Tenant shall also have the right, at its
option and expense, to redecorate or otherwise remodel the Premises upon any
termination hereof or upon subletting or assignment in such manner as will,
without reducing the fair market value thereof, avoid the appearance of the
________ health care facility operated under this Lease; provided, however,
Tenant shall not impair the structural condition of the Premises or reduce the
size thereof. Tenant shall have the right to make any additions, alterations,
changes and improvements, structural and nonstructural, including but not
limited to construction of additional buildings and additions to the then
existing buildings, as Tenant shall desire; provided, however, (i) Tenant shall
submit plans of all structural changes to Landlord at least thirty (30) days in
advance of the proposed construction date, (ii) Tenant shall provide Landlord
with evidence of Tenant's financial ability to pay for such changes, (iii) if
the cost of structural changes exceeds TEN THOUSAND AND NO/100 DOLLARS
($10,000.00), Tenant shall post payment and performance bonds for such work
naming Landlord and Tenant as dual obligees, (iv) all such construction shall be
completed in a workmanlike manner and in full compliance with all
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building laws and ordinances applicable thereto, at Tenant's expense, and (v)
such additions, alterations, changes and improvements shall not reduce the fair
market value of the Premises. All such additions, alterations, changes and
improvements shall be deemed to be a part of the Premises.
(b) Landlord hereby grants Tenant the right and privilege of applying
for and receiving all investment tax credits, if any, under the Internal Revenue
Code which may be available with respect to the building and other improvements
to be constructed. To this end, Landlord agrees to execute all such further
documents and supply such additional information as may be required to make such
election effective.
(c) Tenant shall not do or suffer anything to be done whereby the
Premises, or any part thereof, may be encumbered by a mechanic's lien or similar
lien, and, if, whenever and as often as any mechanic's lien or similar lien is
filed against the Premises, or any part thereof, purporting to be for or on
account of any labor done, materials or services furnished in connection with
any work in or about the Premises, done by, for or under the authority of
Tenant, or anyone claiming by, through or under Tenant, Tenant shall discharge
the same of record within ten (10) days after service upon Tenant of notice of
the filing thereof; provided, however, Tenant shall have the right to remove the
lien by bonding same in accordance with applicable law and to contest any such
lien; provided further that Tenant shall diligently prosecute any such contest,
at all times effectively staying or preventing any official or judicial sale of
the Premises under execution or otherwise, and, if unsuccessful, satisfy any
final judgment against Tenant adjudging or enforcing such lien or, if
successful, procuring record satisfaction or release thereof.
(d) All of Tenant's Property placed in or upon the Premises by Tenant
shall remain the property of Tenant with the right to remove the same at any
time during the term of this Lease. Landlord, if requested by Tenant, agrees to
execute such documentation subordinating its lien rights (vis a vis any
equipment lender or landlord) to Tenant's personalty and to all rights of levy
for distraint for rent against same as shall be reasonably required by any
equipment lender or lessor of Tenant; provided any damage caused by, or
resulting from the removal of any trade fixtures, equipment or other personal
property shall be promptly repaired by Tenant or the party entitled to remove
same.
4. DESTRUCTION OF PREMISES; INSURANCE
(a) If the Premises are damaged or destroyed by fire, flood, tornado or
other element, or by any other casualty and such damage or destruction does not
occur within the last twenty-four (24) months of the original or of any extended
or renewed term of this Lease, this Lease shall continue in full force and
effect and Tenant shall, as promptly as possible, restore, repair or rebuild the
Premises to substantially the same condition as it existed before the damage or
destruction. Tenant shall for this purpose use all, or such part as may be
necessary, of the insurance proceeds received from insurance policies carried on
the Premises under the provision of subparagraph 4(b) hereinbelow. If such
insurance proceeds are not sufficient to pay such costs, Tenant shall pay such
deficit. Should the Premises be damaged or destroyed by any of the
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foregoing described casualties within the last twenty-four (24) months of the
original term or of any extended or renewed term of this Lease, to the extent
that they are untenantable or unsuitable, in Tenant's opinion for continued use
in the normal conduct of Tenant's business, Tenant shall have the right,
exercisable by written notice to Landlord given within thirty (30) days after
the date of such damage or destruction, of terminating this Lease effective upon
the date of such damage or destruction. If Tenant terminates this Lease as thus
provided Landlord shall be entitled to all of the insurance proceeds on the
Premises, but not to the proceeds of insurance carried by Tenant on Tenant's
Property; provided, however, Tenant shall not have the right to terminate this
Lease unless (i) the damage or destruction of the Premises was caused by a peril
which was insured against by the provisions of subparagraph 4(b) of this Lease;
(ii) at the time of such damage and destruction the said insurance policies to
be carried by Tenant were in the amount of the full replacement cost of such
improvements (without deduction or co-insurance) and in full force and effect;
and (iii) the insurer has confirmed coverage and its obligation to pay. If
Tenant defaults in its obligation to carry insurance in the amount required
under subparagraph 4(b), then Tenant shall be obligated to pay toward said
reconstruction or to Landlord, if this Lease is cancelled but prior thereto, the
difference between the amount actually carried and the amount required to be
carried under this paragraph.
(b) Tenant, at its expense and as additional rent hereunder, shall
throughout the term of this Lease and any extension or renewal thereof, keep the
Premises insured with "all risk" coverage, including builder's risk if
applicable, ("all risk" as such term is used in the insurance industry) for the
full replacement value, with any deductible to be approved by Landlord (and
without any co-insurance provision (Agreed Value endorsement)). If the Premises
are located in a flood or earthquake zone, then additional coverage shall be
obtained by Tenant in amounts and in forms acceptable to Landlord. Tenant shall
provide Landlord with copies of such policies or certificates of such coverage,
and the policy or policies shall name Landlord and any mortgagee designated by
Landlord as an additional insured (or, if elected by Landlord, loss payee) and
shall provide that all losses shall be payable as herein provided. All such
policies of insurance shall provide that the amount thereof shall not be reduced
and that none of the provisions, agreements or covenants contained therein shall
be modified or cancelled by the insuring company or companies without thirty
(30) days prior written notice being given to Landlord; and that all insurance
proceeds shall be paid by check payable to Landlord. Such policy or policies of
insurance may also cover loss or damage to Tenant's Property, and the insurance
proceeds applicable to Tenant's Property shall not be paid to Landlord or any
mortgagee but shall accrue and be payable solely to Tenant. In the event of a
casualty, Tenant shall be responsible for any deficiency between the replacement
cost of the Premises and the amount actually paid by the insurance company.
(c) Tenant shall maintain, at its own expense and as additional Rent,
public liability insurance covering the Premises, for the joint benefit of and
insuring Tenant and Landlord, with coverage of not less than $2,000,000.00 per
occurrence, with any deductible to be approved by Landlord, and with a general
aggregate limit of not less than $__0,000,000.00. Landlord (and if Landlord is
either a general or limited partnership, all general partners) shall be named as
an additional insured (or, if elected by Landlord, loss payee). All such
policies of insurance shall
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provide that the amount thereof shall not be reduced and that none of the
provisions, agreements or covenants contained therein shall be modified or
cancelled by the insuring company or companies without thirty (30) days prior
written notice being given to all parties to this Lease. A copy of the policy or
certificate of such insurance shall be delivered to Landlord and shall be issued
by a company or companies licensed to do business in the state where the
Premises are located.
(d) Tenant shall maintain, at its own expense, rental value insurance
covering risk of loss due to the occurrence of any of the hazards insured
against under Tenants' "all risk" coverage insurance and providing coverage in
an amount sufficient to permit the payment of rents payable hereunder for a
period (in such case) of not less than six (6) months. All such policies of
insurance shall provide that Landlord is additional insured (or, if elected by
Landlord, loss payee); and that the amount thereof shall not be reduced and that
none of the provisions, agreements or covenants contained therein shall be
modified or cancelled by the insuring company or companies without thirty (30)
days prior written notice being given to all parties to this Lease. A copy of
the policy or certificate of such insurance shall be delivered to Landlord and
shall be issued by a company or companies licensed to do business in the state
where the Premises are located.
(e) All insurance companies providing the coverage required under this
Paragraph 4 shall be selected by Tenant and shall be rated A minus (A-) or
better by Best's Insurance Rating Service, shall be licensed to write insurance
policies in the state in which the Premises is located, and shall be acceptable
to Landlord in Landlord's reasonable discretion.
5. MAINTENANCE AND REPAIR
(a) Tenant shall maintain the Premises and all buildings and
improvements thereon (interior and exterior, structural and otherwise) in good
order and repair and, subject to the provisions of paragraph 4(a) with respect
to damage within the last twenty-four (24) months of the Lease, and paragraph 6
herein, return the Premises and all buildings and improvements thereon at the
expiration of the term of this Lease or any extension thereof in as reasonably
as good condition as when received, ordinary wear and tear excepted.
(b) Tenant agrees that Landlord shall have no obligation under this
Lease to make any repairs or replacements (including the replacement of obsolete
components) to the Premises or the buildings or improvements thereon, or any
alteration, addition, change, substitution or improvement thereof or thereto,
whether structural or otherwise. The terms "repair" and "replacement" include
the replacement of any portions of the Premises which have outlived their useful
life during the term of the Lease (or any extensions thereof). Landlord and
Tenant intend that the rent received by Landlord shall be free and clear of any
expense to Landlord for the construction, care, maintenance (including common
area maintenance charges and charges accruing under easements or other
agreements relating to the Premises), operation, repair, replacement,
alteration, addition, change, substitution and improvement of or to the Premises
and any building and improvement thereon. Upon the expiration or earlier
termination of this Lease,
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Tenant shall remain responsible for, and shall pay to Landlord, any cost, charge
or expense for which Tenant is otherwise responsible for hereunder attributable
to any period (prorated on a daily basis) prior to the expiration or earlier
termination of this Lease.
6. CONDEMNATION
(a) In the event that the whole or any material part of the building on
the Premises or such a material portion of the land (for purposes hereof,
"material" shall mean more than 20% of the building on the Premises or more than
40% of the land) shall be taken during the term of this Lease or any extension
or renewal thereof for any public or quasi-public use under any governmental
law, ordinance, regulation or by right of eminent domain, or shall be sold to
the condemning authority under threat of condemnation with the result that the
Premises cannot continue to be operated as the type of health care facility
contemplated herein, or if all reasonable access to the adjacent roadways from
the existing or comparable curb cuts shall be taken (any of such events being
hereinafter referred to as a "taking"), Tenant shall have the option of
terminating this Lease as of a date no earlier than the date of such taking,
such termination date to be specified in a notice of termination to be given by
Tenant to Landlord not fewer than fourteen (14) days prior to the date on which
possession of the Premises, or part thereof, must be surrendered to the
condemning authority or its designee.
(b) In the event of any taking which does not give rise to an option to
terminate or in the event of a taking which does give rise to an option to
terminate and Tenant does not elect to terminate, Landlord shall make its award
available to Tenant and Tenant shall, to the extent of the award from such
taking (which word "award" shall mean the net proceeds after deducting expenses
of any settlement, or net purchase price under a sale in lieu of condemnation
but shall exclude the value of Landlord's reversionary interest), promptly
restore or repair the Premises and all improvements thereon (except the items
which Tenant is entitled to remove) to the same condition as existed immediately
prior to such taking insofar as is reasonably possible. If the estimated cost of
restoration or repair shall exceed the amount of Landlord's award, Tenant shall
deposit with Landlord the amount of such excess. The award and any excess shall
be held in trust by Landlord and used, to the extent required, for the purpose
of such restoration or repair. A just and proportionate part of the Rent payable
hereunder shall be abated from the date of such taking until ten (10) days after
Tenant has restored same and thereafter the Rent shall be reduced in proportion
to the reduction in the then rental value of the Premises after the taking in
comparison with the rental value prior to the taking. If the award shall exceed
the amount spent or to be spent promptly to effect such restoration, repair or
replacement, such excess shall unconditionally belong to Landlord and shall be
paid to Landlord.
(c) In the event of any partial taking where this Lease is not
terminated, Tenant shall not be entitled (except for use in reconstruction) to
any part of the compensation or award given Landlord for the taking of the fee
of the Premises, but Tenant shall have the right to recover from the condemning
authority such compensation as is specifically awarded to Tenant (i) to
reimburse Tenant for any cost which Tenant may incur in removing Tenant's
Property from the Premises and (ii) for loss of Tenant's business.
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(d) If this Lease is terminated by reason of a taking then Landlord
shall be entitled to receive the entire award in any such condemnation or
eminent domain proceedings or purchase in lieu thereof and Tenant hereby assigns
to Landlord all of its right, title and interest in and to all and any part of
such award, provided, however, Tenant shall be entitled to receive any award
specifically made to reimburse Tenant.
7. TAXES AND ASSESSMENTS
Tenant shall pay prior to delinquency all taxes and assessments which
may be levied upon or assessed against the Premises and all taxes and
assessments of every kind and nature whatsoever arising in any way from the use,
occupancy or possession of the Premises or assessed against the improvements
situated thereon, together with all taxes levied upon or assessed against
Tenant's Property. To that end Landlord shall not be required to pay any taxes
or assessments whatsoever which relate to or may be assessed against this Lease,
the Rent and other amounts due hereunder, the Premises, improvements and
Tenant's Property. Provided, however, that any taxes or assessments which may be
levied or assessed against the Premises for a period ending after the
termination hereof shall be prorated between Landlord and Tenant as of such
date. Within thirty (30) days after Tenant receives the paid receipted tax
bills, Tenant shall furnish Landlord with copies of a paid receipt for such tax
bills. Upon demand by Landlord, Tenant shall deliver and pay over to Landlord
such additional sums as are necessary to satisfy any deficiency in the amount
necessary to pay the taxes before the same become due. Tenant may, at its
option, contest in good faith and by appropriate and timely legal proceedings
any such tax and assessment; provided, however, that Tenant shall indemnify and
hold harmless Landlord from any loss or damage resulting from any such contest,
and all expenses of same (including, without limitation, all attorneys' fees,
court and other costs) are paid solely by Tenant.
8. COMPLIANCE, UTILITIES, SURRENDER
(a) Tenant at its expense shall promptly comply with all governmental
requirements, whether or not compliance therewith shall require structural
changes in the Premises; will procure and maintain all permits, licenses and
other authorizations required for the use of the Premises or any part thereof
then being made and for the lawful and proper installation, operation and
maintenance of all equipment and appliances necessary or appropriate for the
operation and maintenance of the Premises, and shall comply with all easements,
restrictions, reservations and other instruments of record applicable to the
Premises. Tenant shall indemnify and save Landlord harmless from all expenses
and damages by reason of any notices, orders, violations or penalties filed
against or imposed upon the Premises, or against Landlord as owner thereof,
because of Tenant's failure to comply with this paragraph.
(b) Tenant shall pay all charges for heat, water, gas, sewage,
electricity and other utilities used or consumed on the Premises and shall
contract for the same in its own name. Landlord shall not be liable for any
interruption or failure in the supply of any such utility service to the
Premises.
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(c) Tenant shall peacefully surrender possession of the Premises, the
buildings and other improvements thereon, to Landlord at the expiration, or
earlier termination, of the original term or any extended or renewed term of
this Lease.
9. QUIET ENJOYMENT
Landlord covenants and warrants that Landlord has full power and
authority to make this Lease, and that Tenant shall have and enjoy full, quiet
and peaceful possession of the Premises, their appurtenances and all rights and
privileges incidental thereto during the term hereof and any renewals or
extensions, subject to the provisions of this Lease and any easements,
restrictions, reservations and other instruments of record applicable to the
Premises and in existence at the time of the conveyance of the Premises to
Landlord by Tenant.
10. OPTION TO RENEW
Tenant shall have ___ (_) successive five (5) year options to extend
this Lease for up to an additional _____ (__) years upon the same terms,
covenants, conditions and rental as set forth herein provided that Tenant is not
in default hereunder at the commencement of such option period. Tenant may
exercise each such five (5) year option by giving written notice to Landlord not
less than six (6) months prior to the expiration of the then current term of
this Lease. Should Tenant fail to give Landlord such timely written notice
during the required period, all remaining rights of renewal shall automatically
expire.
11. FIRST RIGHT OF REFUSAL TO PURCHASE; OPTION TO PURCHASE
(a) So long as Tenant is not in default under this Lease, Tenant shall
have the right to purchase the Premises in accordance with the terms of this
paragraph. If Landlord receives and desires to accept a bona fide offer to
purchase (excluding any transfer to an affiliate of Landlord) the Premises
during the term of this Lease or any extension or renewal thereof, Landlord
shall serve a notice on Tenant stating the name of such offeror with a copy of
the terms and conditions of such offer attached and Tenant shall have the right
to purchase the Premises on the same terms and conditions set forth in
Landlord's notice, provided Tenant delivers written notice to Landlord of its
election to do so within twenty (20) days after receipt of such notice from
Landlord. If Tenant does not elect to exercise its right to purchase as
aforesaid, Landlord may sell the Premises, provided the sale is consummated with
the offeror and on the terms and conditions set forth in Landlord's notice to
Tenant. The foregoing preemptive right shall remain in existence notwithstanding
its non-exercise in respect to any sale and shall be binding upon Landlord's
successors in title.
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(b) Tenant shall have the option to purchase the Premises at any time
after the _____________ (__th) Lease Year, as follows:
(i) Tenant shall exercise its option hereunder by giving
written notice in writing to Landlord in accordance with the requirements of
paragraph 20 of this Lease. At the time of the exercise of the option, Tenant
shall also pay to Landlord (or if required by Landlord, to the qualified
intermediary described in Paragraph 19(b) of this Lease Agreement) a
non-refundable deposit of FIVE HUNDRED AND NO/100 DOLLARS ($500.00).
(ii) The purchase price to be paid by Tenant shall be the
greater of (A) the fair market value of the Premises as of the date of the
exercise of the option, as determined by an appraisal of an M.A.I. qualified
appraiser selected by Landlord, or (B) Landlord's cost for the Premises, plus
___________ percent (__%).
(iii) The closing pursuant to the option shall be held in the
office of Landlord's attorneys on or before a date which is thirty (30) days
after Landlord and Tenant have received the above mentioned appraisal from the
appraiser, or at such other place as shall be acceptable to Landlord.
(iv) Tenant shall receive a credit for the deposit required
under (i) above and the balance of the purchase price shall be paid at closing
in cash, by cashier's check on cleared local funds or by wire transfer to
Landlord's account.
(v) All expenses of closing shall be paid equally by Tenant
and Landlord.
(vi) The option granted to Tenant pursuant to this
subparagraph (b) shall terminate and become null and void (A) in the event
Tenant shall purport to exercise said option at a time when Tenant shall then be
in default under any term or condition of this Lease, or (B) in the event
Tenant's right of first refusal becomes operative, Tenant fails to exercise such
right of first refusal, and the offer triggering such right of first refusal
closes.
(c) Tenant's rights and options granted in (a) and (b) above shall be
subject and subordinate to any rights or options currently of record or those
existing under Tenant's franchise agreement, if any.
12. NONCOMPETE
Tenant shall not own an interest in, or operate, another __________
health care facility within a _________ (__) mile radius of the Premises.
Violation of this covenant shall constitute a default hereunder and, because the
parties agree that damages would not be an adequate remedy, Tenant hereby agrees
that Landlord shall be entitled to equitable relief, including injunctive relief
and specific performance in addition to any remedy available at law.
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13. DEFAULT
(a) If any one or more of the following events occur, said event or
events shall hereby be classified as a "Default":
(i) If Tenant fails to pay Interim Rent (if applicable) Annual
Rent, any additional rent, or any other charges required hereunder or under any
other lease with Landlord or an affiliate of Landlord when same shall become due
and payable, and such failure continues for ten (10) days after written notice
from Landlord.
(ii) If Tenant shall fail to perform or observe any term,
condition, covenant, agreement, or obligation of this Lease or any other lease
with Landlord or an affiliate of Landlord, and such failure continues for
fifteen (15) days after written notice from Landlord (except that such fifteen
(15) day period shall be automatically extended for such additional period of
time as is reasonably necessary to cure such Default, if such Default cannot be
cured within such period, provided Tenant is in the process of diligently curing
the same).
(iii) If any default or event of default shall occur and
remain uncured under that certain Franchise Agreement (the "Franchise
Agreement") between Tenant and _________________ following any cure period
applicable thereto and established in the Franchise Agreement, or if such
Franchise Agreement is terminated for any reason. Notwithstanding the foregoing,
Tenant shall have the right to engage in good faith disputes with the franchisor
under the Franchise Agreement without such dispute constituting a default under
this Lease, provided that such dispute shall not prevent Tenant from performing
its obligation to continuously operate a _______ health care facility at the
Premises.
(iv) If Tenant fails to continuously operate its business
within the Premises except for temporary periods of closure caused by casualty,
or temporary and reasonable periods of remodeling not to exceed ninety (90) days
in any Lease Year without first obtaining Landlord's written approval.
(v) If Tenant shall make an assignment for the benefit of
creditors or file a petition, in any federal or state court, in bankruptcy,
reorganization, composition, or make an application in any such proceedings for
the appointment of a trustee or receiver for all or any portion of its property.
(vi) If any petition shall be filed under federal or state law
against Tenant in any bankruptcy, reorganization, or insolvency proceedings, and
said proceedings shall not be dismissed or vacated within thirty (30) days after
such petition is filed.
(vii) If a receiver or trustee shall be appointed under
federal or state law for Tenant, or any guarantor of Tenant's obligations
hereunder, for all or any portion of the property of either of them, and such
receivership or trusteeship shall not be set aside within thirty (30) days after
such appointment.
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(viii) If, after Lessee has obtained approval for Medicare
and/or Medicaid funding, a final unappealable determination is made by the
applicable Governmental Authority that Tenant shall have failed to comply with
applicable Medicare and/or Medicaid regulations in the operation of the
facility, as a result of which failure Tenant declared ineligible to receive
reimbursements under the Medicare and/or Medicaid programs, which determination
shall have a material adverse effect on Tenant, any Guarantor or the facility,
unless such determination is the result of a business decision of Tenant,
approved in advance by Landlord (which approval shall not be unreasonably
withheld or delayed), to operate the facility on a one hundred percent (100%)
non-Medicare and/or non-Medicaid basis, as the case may be; provided, however,
that notwithstanding the foregoing, upon the prior approval of Landlord (which
approval shall not be unreasonably withheld or delayed) Tenant may elect to
decertify (or otherwise remove or withdraw) a portion of the beds at the
facility from participation in the Medicare and/or Medicaid programs.
(ix) If Tenant or any Guarantor receives notice of (a) a final
unappealable determination by applicable Governmental Authorities of the
revocation of any permit required for the lawful operation of the facility in
accordance with its primary intended use, and such revocation shall have a
material adverse affect on the ability of Tenant to operate the facility in
accordance with the primary intended use, or (b) the loss of any permit under
any other circumstances under which Tenant is permanently required to cease
operation of the facility in accordance with its primary intended use.
(b) Upon the happening of any one or more of the aforementioned
Defaults which are not cured within the cure period applicable thereto, if any,
Landlord shall have the right, in addition to any other rights and remedies, to
terminate this Lease by giving written notice of same to Tenant. Upon such
notice, this Lease shall cease and expire, and Tenant shall surrender the
Premises to Landlord. Notwithstanding such termination, Tenant's liability and
obligation under all provisions of this Lease, including the obligation to pay
Rent and any and all other amounts due hereunder shall survive and continue. In
addition, in the event of Tenant's Default under this Lease, Landlord may, by
notice to Tenant, accelerate the monthly installments due hereunder for the
remaining term of this Lease, in which event such amount, together with any sums
then in arrears, shall immediately be due and payable to Landlord. Tenant hereby
expressly agrees that its occupation of the Premises after default constitutes
forcible detainer (or equivalent) as is defined by the law in force in the
jurisdiction in which the Premises are located.
(c) If this Lease shall terminate as provided hereinabove, Landlord may
re-enter the Premises and remove Tenant, its agents and sub-tenants, together
with all or any of Tenant's Property, by suitable action at law, or by force.
Tenant waives any right to the service of any notice of Landlord's intention to
re-enter and Landlord shall not be liable in any way in connection with any
action it takes pursuant to this paragraph. Notwithstanding such re-entry or
removal, Tenant's liability under the provision of this Lease shall survive and
continue.
(d) In case of re-entry, repossession or termination of this Lease,
Tenant shall remain liable for Rent, any additional rent and all other charges
provided for in this Lease for the
11
otherwise remaining term of this Lease, and any and all expenses which Landlord
may have incurred in re-entering the Premises including, but not limited to,
allocable overhead, alterations to the building, leasing, construction,
architectural, legal and accounting fees. In addition, Tenant shall pay to
Landlord any and all attorneys' fees, legal costs and expenses incurred with
respect to enforcement of the provisions hereof. Landlord shall have the right,
but not the obligation, to relet the whole or part of the Premises upon terms
which Landlord, in its sole discretion, deems appropriate and Tenant shall be
responsible for all expenses incurred by Landlord in re-letting or attempting to
re-let and all rent collected for reletting shall be credited against all of
Tenant's obligations hereunder.
(e) The rights and remedies of Landlord set forth herein shall be in
addition to any other right and remedy now or hereinafter provided by law, and
all such rights and remedies shall be cumulative. No action or inaction by
Landlord shall constitute a waiver of a Default, and no waiver of Default shall
be effective unless it is in writing, signed by Landlord.
14. HOLDING OVER
In the event Tenant remains in possession of the Premises after the
expiration of this Lease, without executing a new lease, Tenant shall occupy the
Premises as a tenant from month to month subject to all the terms hereof, but
such possession shall not limit Landlord's rights and remedies by reason thereof
nor constitute a holding over.
15. WAIVER OF SUBROGATION
Notwithstanding anything in this Lease to the contrary, other than
Tenant's obligations to repair, restore or rebuild described in paragraph 4
hereinabove, neither party shall be liable to the other for any damage or
destruction of the property of the other resulting from fire or other casualty
covered by insurance required of either party hereunder, whether or not such
loss, damage or destruction of property is caused by or results from the
negligence of such party (which term includes such party's officers, employees,
agents and invitees), and each party hereby expressly releases the other from
all total liability for or on account of any said loss, damage or destruction,
whether or not the party suffering the loss is insured against such loss, and if
insured whether fully or partially. Each party shall procure all endorsements of
insurance policies carried by it necessary to protect the other from any right
of subrogation and/or liability in the event of such loss.
16. LIEN FOR RENTS
As security for Tenant's payment of Rent and all other payments
required to be made by Tenant hereunder (including, by way of illustration only,
taxes, damage to the Premises, court costs, and attorneys' fees) Tenant hereby
grants to Landlord a lien upon all of Tenant's Property now or hereafter located
upon the Premises. The lien herein provided shall be subordinate to the lien of
any chattel mortgage, collateral assignment or security interest given by Tenant
to any seller of such property. If default is made by Tenant in the payment of
any sum which may
12
become due hereunder and said sum is not paid within ten (10) days after written
notice is given by Landlord to Tenant for Tenant's default, Landlord may enter
upon the Premises and take possession of Tenant's Property, or any part thereof,
and may sell all or any part of Tenant's Property at public or private sale in
one or successive sales, with or without notice, to the highest bidder for cash
and on behalf of Tenant. Landlord may sell and convey Tenant's Property, or any
part thereof, to such bidder, delivering to such bidder all of Tenant's title
and interest in such property sold to him. The proceeds of such sale shall be
applied by Landlord toward the costs thereof and then toward the payment of all
sums when due by Tenant to Landlord hereunder.
17. ASSIGNMENT AND SUBLETTING
(a) The Tenant shall not have the right, without first obtaining
Landlord's prior written consent which will not be unreasonably withheld, to
assign or sublet any part or all of the Premises to any party for any purpose. A
change in ownership of the controlling interest of Tenant shall also constitute
an assignment subject to this subparagraph. Landlord, without being deemed
unreasonable, may withhold its consent to any proposed assignment or subletting
where (i) the financial capacity of such assignee or subtenant is materially
less than that of tenant or (ii) such assignee or subtenant does not intend to
operate a health care facility on the Premises or (iii) even if such assignee or
subtenant intends to operate a health care facility on the Premises, the type of
health care facility or the operating history of such assignee or subtenant or
the operating history of such type of health care facility reflects an inability
to generate Gross Revenues and potential revenues growth equal to or greater
than that of the Tenant. Even if such consent to assignment or subletting is
given by Landlord, such assignment or subletting shall not relieve Tenant of its
liability for the continued performance of all terms, covenants and conditions
of this Lease, including without limitation the payment of all rent, additional
rent and Percentage Rent and other charges thereunder. Likewise, as a condition
of any such assignment by Tenant, the assignee shall be required to execute and
deliver to Landlord, upon the effective date of such assignment, an agreement,
in recordable form, whereby such assignee assumes and agrees to discharge all
obligations of Tenant under this Lease.
(b) In the event of the subletting or assignment of this Lease, any
monetary consideration obtained from an assignee or transferee upon such
subletting or assignment shall be paid to Landlord. In the event of the
subletting or assignment of this Lease, if Tenant derives funds or rental income
greater than what it is paying to Landlord under this Lease, the Annual Rent
provided for herein shall be increased to that amount received by Tenant from
sublessee or assignee of this Lease.
(c) Prior to any assignment allowed hereunder, Tenant shall deliver to
Landlord (i) a copy of the assignment documents (including copies of any
recorded documents), and (ii) the name, address and telephone number of such
assignee and a designated contact person for such assignee, and (iii) a new
insurance policy and binder complying with the terms of this Lease and naming
such assignee as the tenant of the Premises. Notwithstanding anything herein to
the contrary, in the event of any assignment of this Lease or subletting of the
Premises, Tenant shall not be released from its obligations under this Lease
unless specifically released by virtue of a
13
separate written instrument executed by Landlord, which may be withheld in
Landlord's sole discretion.
(d) The Landlord shall have the right without limitation (subject to
paragraph 11 hereof) to sell, convey, transfer or assign its interest in the
Premises or its interest in this Lease, and upon such conveyance being completed
all covenants and obligations of Landlord under this Lease accruing thereafter
shall cease, but such covenants and obligations shall run with the land and
shall be binding upon the subsequent landlord or owners of the Premises or of
this Lease.
18. SUBORDINATION, NON-DISTURBANCE, ATTORNMENT, ESTOPPEL CERTIFICATE.
(a) Upon written request of the holder of any mortgage (which term
"mortgage" shall also include deeds of trust) now or hereafter relating to the
Premises, Tenant will subordinate its rights under this Lease to the lien
thereof and to all advances made or hereafter to be made upon the security
thereof, and Tenant shall execute, acknowledge and deliver an instrument in the
form customarily used by such encumbrance holder to effect such subordination;
provided, however, as a condition of all such subordinations, the holder of such
mortgage shall be first required to agree with Tenant that, notwithstanding the
foreclosure or other exercise of rights under any such first or other mortgage,
Tenant's possession and occupancy of the Premises and the improvements and its
leasehold estate shall not be disturbed or interfered with nor shall Tenant's
rights and obligations under this Lease be altered or adversely affected thereby
so long as Tenant is not in default hereunder.
(b) Notwithstanding anything set out in subparagraph (a) above to the
contrary, in the event the holder of any such mortgage elects to have this Lease
be superior to its mortgage, then upon Tenant's being notified to that effect by
such encumbrance holder, this Lease shall be deemed prior to the lien of said
mortgage, whether this Lease is dated prior or subsequent to the date of said
mortgage, and Tenant shall execute, acknowledge and deliver an instrument, in
the form customarily used by such encumbrance holder, effecting such priority.
(c) In the event proceedings are brought for the foreclosure of, or in
the event of the exercise of the power of sale under any mortgage made by
Landlord covering the Premises, or in the event of delivery of a deed in lieu of
foreclosure under such a mortgage Tenant will attorn to the purchaser upon any
such foreclosure or sale and recognize such purchaser as Landlord under this
Lease, and upon the request of the purchaser, Tenant shall execute, acknowledge
and deliver an instrument, in form and substance satisfactory to such purchaser,
evidencing such attornment.
(d) Each party agrees, within seven (7) days after written request by
the other, to execute, acknowledge and deliver to and in favor of any proposed
mortgagee or purchaser of the Premises, an estoppel certificate, in the form
customarily used by such proposed mortgagee or purchaser, stating, among other
things (i) whether this Lease is in full force and effect, (ii) whether this
Lease has been modified or amended and, if so, identifying and describing any
such
14
modification or amendment, (iii) the date to which rent and other charge has
been paid, and (iv) whether the party furnishing such certificate knows of any
default on the part of the other party or has any claim against such party and,
if so, specifying the nature of such default or claims.
(e) Upon written demand by the holder of any mortgage covering the
Premises, Tenant shall forthwith execute, acknowledge and deliver an agreement
in favor of and in the form customarily used by such encumbrance holder, by the
terms of which Tenant will agree to give prompt written notice to such
encumbrance holder in the event of any casualty damage to the Premises or in the
event of any default on the part of Landlord under this Lease, and will agree to
allow such encumbrance holder a reasonable length of time after notice to cure
or cause the curing of such default before exercising Tenant's rights under this
Lease, or terminating or declaring a default under this Lease.
19. COOPERATION
(a) Landlord shall fully cooperate with Tenant throughout the term of
this Lease to secure or maintain proper zoning, building and other permits and
compliance with all applicable laws. Landlord shall execute any petitions,
requests, applications and the like as Tenant shall reasonably request in order
to obtain any permit, license, variances and approvals which, in the reasonable
judgment of Tenant, are necessary for the lawful construction and/or operation
of Tenants business on the Premises, provided, however, that Tenant shall
indemnify and save Landlord harmless from any and all expenses, costs, charges,
liabilities, losses, obligations, damages and claims of any type which may be
imposed upon, asserted against or incurred by Landlord by reason of same.
(b) In the event that Tenant elects to purchase the Premises pursuant
to the terms and conditions of paragraph 11 hereof, Landlord shall have the
right, in Landlord's sole discretion, to enter into an exchange agreement (the
"Exchange Agreement") with a qualified intermediary (the "Intermediary") in
order to effectuate a like-kind exchange of the Premises for one or more other
properties (the "Replacement Property"). In that event, Landlord shall assign to
the Intermediary all of Landlord's right, title and interest in the written
contract for purchase and sale of the Premises entered into between Landlord and
Tenant as required by paragraph 11 hereof (the "Purchase Contract"), and any
deposit paid by Tenant in connection with the purchase of the Premises shall be
placed directly with the Intermediary, subject to the terms and conditions of
the Purchase Contract and the Exchange Agreement. Landlord and Tenant agree
that, at Landlord's option, Tenant shall cooperate with Landlord in effecting a
like-kind exchange of the Premises by Landlord pursuant to and in accordance
with the provisions of Section 1031 of the Internal Revenue Code of 1986, as
amended, and the Treasury Regulations promulgated thereunder, which cooperation
shall include, without limitation, Tenant's consent to Landlord's assignment of
its interest in the Purchase Contract to the Intermediary and Tenant receiving
or taking title to the Premises from the Intermediary or another third party
utilized in the transaction in order to facilitate the like-kind exchange on
behalf of Landlord.
15
20. NOTICES
All notices and other communications required or permitted to be given
hereunder shall be in writing and shall be delivered by a nationally recognized
overnight courier or mailed by registered or certified mail, postage prepaid,
return receipt requested, addressed as follows:
If to Landlord: CNL __________
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
with copy to: (Attorney's Name and Address)
-------------------------
-------------------------
-------------------------
If to Tenant: (TENANT NAME), a (State of Incorporation)
(Tenant Entity Type)
(Tenant Street Address)
(Tenant Street Address)
(Tenant City), (Tenant State) (Tenant Zip)
Any party may change its address for notices by written notice in like
manner as provided in this paragraph and such change of address shall be
effective seven (7) days after the date notice of such change of address is
given. Notice for purposes of this Lease shall be deemed given when it shall
have been deposited in the mail by the party who is giving such notice with
sufficient postage prepaid.
21. INDEMNIFICATION
Tenant does hereby indemnify and exonerate Landlord against and from
all liabilities, losses, obligations, damages, penalties, claims, costs, charges
and expenses, including reasonable architects' and attorneys' fees, which may be
imposed upon or asserted against or incurred by Landlord by reason of any of the
following occurring:
(a) any work or thing done in respect of construction of, in or to
the Premises or any part of the improvements now or hereafter constructed on
the Premises;
(b) any use, possession, occupation, operation, maintenance or
management of the Premises or any part hereof;
(c) any failure to, or to properly, use, possess, occupy, operate,
maintain or manage the Premises or any part thereof;
(d) the condition, including environmental conditions, of the
Premises or any part thereof;
16
(e) any negligence on the part of Tenant or any of its agents,
contractors, servants, employees, licensees or invitees;
(f) any accident, injury or damage to any person or property occurring
in, on or about the Premises or any part thereof including any sidewalk adjacent
thereto; or
(g) any failure on the part of Tenant to perform or comply with any of
the covenants, agreements, terms or conditions contained in this Lease on its
part to be performed or complied with.
22. HOLD HARMLESS
Tenant agrees to hold Landlord harmless against any and all claims,
damages, accidents and injuries to persons or property caused by or resulting
from or in connection with anything in or pertaining to or upon the Premises
during the term of this Lease or while Tenant is occupying the Premises, except
if such claim, damage, accident or injury shall be caused by the negligence of
Landlord or its agents. Landlord shall not be liable to Tenant, Tenant's
employees, agents, invitees, licensees or any other person whomsoever for any
injury to person or damage to property on or about the Premises caused by the
negligence or misconduct of Tenant, its agents, servants or employees or of any
other person entering the building under expressed or implied invitation by
Tenant or due to any other cause whatsoever, unless caused by the negligence or
neglect of Landlord, its employees or its authorized representatives.
23. LANDLORD'S LIABILITIES
The term "Landlord" as used in this Lease means the owner from time to
time of the Premises. Neither Landlord nor any partner, shareholder or
beneficiary thereof shall have any personal liability with respect to any of the
provisions of this Lease and if Landlord is in default with respect to its
obligations hereunder Tenant shall look solely to the equity of Landlord in the
Premises.
24. SUCCESSORS
The covenants, conditions and agreements contained in this Lease shall
bind and inure to the benefit of Landlord and Tenant and their respective heirs,
legal representatives, successors and assigns.
25. ENTIRE AGREEMENT/MEMORANDUM OF LEASE
This Lease contains the entire agreement between the parties hereto and
may not be modified in any manner other than in writing signed by the parties
hereto or their successors in interest. A memorandum of this Lease shall be
executed by the parties and shall be recorded in the official records of the
county where the Premises are located.
17
26. GENDER
Whenever the context hereof permits or requires, words in the singular
may be regarded as in the plural and vice-versa, and personal pronouns may be
read as masculine, feminine and neuter.
27. BROKERAGE FEES
It is understood and agreed that neither party has incurred any real
estate brokerage fees or commissions arising out of this Lease and each party
agrees to hold the other harmless from and against all such fees and commissions
incurred, and costs related thereto including legal fees, as a result of its own
conduct or alleged conduct.
28. CAPTIONS
The captions of this Lease are for convenience only, and do not in any
way define, limit, disclose, or amplify terms or provisions of this Lease or the
scope or intent thereof.
29. LANDLORD'S RIGHT TO CURE
In the event Tenant shall fail, refuse or neglect to perform, observe
or comply with any term, condition, covenant, agreement or obligation contained
in the Lease on its part to be performed or complied with, then Landlord may, at
its sole option, enter upon the Premises, if deemed necessary by Landlord in its
sole discretion, and/or do whatever may be deemed necessary by Landlord in its
sole discretion to cure such failure by Tenant. Tenant shall pay to Landlord
within five (5) days of Landlord's request, all costs incurred by Landlord in
connection with Landlord's curing of such failure by Tenant including, but not
limited to, reasonable attorney and paralegal fees whether or not judicial
proceedings are involved. In addition to the above costs, in the event Landlord
does not receive payment from Tenant when due hereunder, interest at the rate of
eighteen percent (18%) per annum or the highest rate allowable by law shall be
due and payable with respect to such payment from the due date thereof until
Landlord receives such payment.
30. COMMITMENT LETTER
That certain commitment letter dated ______________, 199_ is hereby
incorporated herein by reference and the terms and conditions thereof shall
survive closing with respect to the transaction contemplated by this Lease. In
the event any terms of the commitment letter are inconsistent with the terms
contained in this Lease, the terms of this Lease shall control.
18
31. NOT A SECURITY ARRANGEMENT
The parties hereto agree and acknowledge that this transaction is not
intended as a security arrangement or financing secured by real property, but
shall be construed for all purposes as a true lease.
32. NET LEASE
It is the intention of the parties hereto that this Lease is and shall
be treated as a triple net lease. Any present or future law to the contrary
notwithstanding, this Lease shall not terminate (except as expressly provided in
paragraph 4(a)) nor shall Tenant be entitled to any abatement, suspension,
deferment, reduction (except as expressly provided in paragraph 6(b) hereof),
setoff, counterclaim, or defense with respect to the rent, nor shall the
obligations of Tenant hereunder be affected by reason of: any damage to or
destruction of the Premises or any part thereof; any taking of any Premises or
any part thereof or interest therein by Condemnation or otherwise (except as
expressly provided in paragraph 6(b) hereof); any prohibition, limitation,
restriction or prevention of Tenant's use, occupancy or enjoyment of the
Premises or any part thereof, or any interference with such use, occupancy or
enjoyment by any person or for any other reason; any title defect or encumbrance
or any matter affecting title to the Premises or any part thereof; any eviction
by paramount title or otherwise; any default by Landlord hereunder; any
proceeding relating to Landlord; the impossibility or illegality of performance
by Landlord, Tenant or both; any action of governmental authority; any breach of
warranty or misrepresentation; any defect in the condition, quality or fitness
for use of the Premises or any part thereof; or any other cause whether similar
or dissimilar to the foregoing and whether or not Tenant shall have notice or
knowledge of any of the foregoing. The parties intend that the obligations of
Tenant hereunder shall be separate and independent covenants and agreements and
shall continue unaffected unless such obligations shall have been modified or
terminated in accordance with an express provision of this Lease.
33. WAIVER
No waiver by Landlord of any provision hereof shall be deemed a wavier
of any other provision hereof or of any subsequent breach by Tenant of the same
or any other provision. Landlords'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.
34. TIME OF THE ESSENCE
Landlord and Tenant agree that time shall be of the essence of all
terms and provisions of this Lease.
19
35. GOVERNING LAW
This Lease shall be construed in accordance with the laws of the state
in which the Premises is located.
IN WITNESS WHEREOF, the parties hereto have caused this Lease Agreement
to be executed the day and date first above written.
Signed, Sealed and Delivered
in the presence of: "LANDLORD"
CNL ___________________ , a
__________________corporation
-------------------------
By:
----------------------------------------
Name:
---------------------
-------------------------
Name:
---------------------
STATE OF FLORIDA
COUNTY OF ORANGE
The foregoing instrument was acknowledged before me this ____ day of
_______________, 1998 by ____________________, as ______________________ of CNL
_____________________, a ____________________, on behalf of the
_______________________. He is personally known to me and did not take an oath.
---------------------------------
Notary Signature
---------------------------------
Printed Name
Notary Public, State of Florida
Commission Number:
---------------
My Commission Number:
---------------
20
"TENANT"
(TENANT NAME), a (State of
Incorporation) (Tenant Entity Type)
-----------------------
By:
---------------------------------
Name: Name:
------------------ ---------------------------------
As Its:
-------------------------------
-----------------------
Name:
------------------
STATE OF ______________
COUNTY OF ____________
The foregoing was executed before me on , 1998, by
_______________________________ as ____________________________ of
__________________________________, a __________ corporation, on behalf of the
corporation. He/She is personally known to me or produced
______________________________________________________________ as identification
and did not take an oath.
-------------------------------------------
(NOTARY SEAL) Notary Public, State of
--------------------
Printed Name:
------------------------------
Notary Commission No.
-----------------------
My Commission Expires:
---------------------
Exhibit "A" - Legal Description
Exhibit "A"
Legal Description of the Premises
RENT ADDENDUM
to
LEASE AGREEMENT
THIS RENT ADDENDUM dated (Closing Date), by and between CNL __________,
a (State of Registration) (Landlord Entity Type) as "Landlord", and (TENANT
NAME),a (State of Incorporation) (Tenant Entity Type), as "Tenant", for (HEALTH
CARE FACILITY NAME) (Site Number), (City), (County) County, (State), is attached
to and made a part of that certain Lease Agreement by and between Landlord and
Tenant of even date herewith (the "Lease"). Notwithstanding any other provision
to the contrary which may be contained in said Lease, it is specifically agreed
by and between Landlord and Tenant as follows:
(a) Commencement of Rent.
On the date hereof, Landlord has simultaneously entered into the Lease
with Tenant pursuant to which Tenant has agreed to lease from Landlord the
Premises and all improvements now or hereafter constructed thereon. Payment of
Interim Rent (if applicable), Annual Rent and Percentage Rent shall commence as
of the Effective Date as provided herein, notwithstanding that the improvements
may not be constructed or complete at that time.
(b) Interim Rent.
The terms and provisions of this paragraph (b) shall apply only if a
Construction Addendum is attached to and incorporated in the Lease. From and
after the Effective Date until Annual Rent shall first become due and payable
pursuant to subparagraph (c) below, Interim Rent shall be due and payable in
advance monthly installments on the first day of each month. For purposes of
this Lease, the term "Interim Rent" shall mean an amount equal to the product of
(i) ___________ percent (_____%) per annum, multiplied by (ii) the amount
theretofore funded by Landlord under the terms of the Construction Addendum.
Interim Rent for partial months shall be prorated on a per diem basis.
[[INSERT FOLLOWING VERSION OF PARAGRAPH (c) FOR CONSTRUCTION
SITES]]
(c) Annual Rent
(i) Definitions. Capitalized terms used in the Lease and the
Construction Addendum shall have the same meaning in this Rent Addendum unless
otherwise defined. In addition to those terms defined elsewhere in this Rent
Addendum, as used herein the following terms shall have the meaning indicated:
"Construction Period" shall mean the period beginning on the Effective
Date and ending on the earliest of (i) ____________ (___) days after the
Effective Date; (ii) the date a certificate of occupancy for the Premises is
issued; (iii) the date the health care facility opens for business
on the Premises; and (iv) the date Tenant receives from Landlord its final
funding of the construction costs for the Project under this Construction
Addendum.
"Annual Rent Commencement Date" shall mean the last day of the Construction
Period.
"Total Cost" shall mean the sum of (i) the purchase price paid by
Landlord for the land comprising a portion of the Premises, plus (ii) all
approved closing costs paid by Landlord, plus (iii) all actual "hard"
construction costs and approved "soft" costs incurred by Tenant and funded by
Landlord during the Construction Period pursuant to the terms and conditions of
the Construction Addendum.
(ii) Initial Annual Rent. Beginning on the Annual Rent
Commencement Date, Tenant covenants and agrees to pay to Landlord Annual Rent in
an annual amount equal to ______________ percent (______%) multiplied by the
Total Cost, payable to Landlord in equal monthly installments in advance, on the
first (1st) day of each month. Landlord and Tenant agree that prior to the
Annual Rent Commencement Date they will endeavor to establish the Total Cost so
that rent payable on the Annual Rent Commencement Date will be known prior to
such date. However, if the exact amount of the Total Cost shall not have been
finally ascertained prior to the Annual Rent Commencement Date, Tenant shall as
of the Annual Rent Commencement Date pay Landlord rent based on an annual rent
under the Lease determined by multiplying ___________ percent (____%) times
$__________________________ (the Funding Limitation set forth in the
Construction Addendum), and if, when the exact amount of the Total Cost shall
have been ascertained (the "Final Disbursement Date"), such Total Cost is more
or less than $_________________, Landlord or Tenant, as the case may be, shall
promptly refund or remit to the other an amount equal to the excess rent paid or
the underpayment of rent due. On the Final Disbursement Date, Landlord shall
mail to Tenant a statement setting forth a schedule of funds disbursed by
Landlord to Tenant under the Construction Addendum; shall compute the Annual
Rent payable hereunder; and shall state the excess rent paid or underpayment of
rent due. The Annual Rent set forth in such statement shall constitute the
Annual Rent due hereunder.
(iii) Increases in Annual Rent. Commencing at the end of the
______ Lease Year after the Effective Date, and on each ______ anniversary of
such date thereafter during the term of this Lease (and any extension thereof),
Annual Rent shall be increased by an amount equal to _____ percent (__%) of the
Annual Rent payable during the immediately preceding Lease Year.
(iv) Partial Months. If the date on which Annual Rent shall
first be due and payable shall fall on a day other than the first day of a
calendar month, then rent for the partial rental month shall be prorated on a
per diem basis on the first Annual Rent payment and shall be paid by Tenant to
Landlord for such month.
[[INSERT FOLLOWING VERSION OF PARAGRAPH (c) FOR EXISTING STORES/NO
CONSTRUCTION ADDENDUM]]
2
(c) Annual Rent
(i) Beginning on the Effective Date, Tenant covenants and
agrees to pay to Landlord Annual Rent in the annual amount of
_________________________________________, payable to Landlord in equal monthly
installments in the amount of ___________________________________ AND
___/DOLLARS ($ ) monthly in advance, on the first (1st) day of each month.
(ii) Increases in Annual Rent. Commencing at the end of the
______ Lease Year after the Effective Date, and on each _______ anniversary of
such date thereafter during the term of this Lease (and any extension thereof),
Annual Rent shall be increased by an amount equal to _______ percent (__%) of
the Annual Rent payable during the immediately preceding Lease Year.
(iii) Partial Months. If the date on which Annual Rent shall
be first due and payable shall fall on a day other than the first day of a
calendar month, then rent for the partial rental month shall be prorated on a
per diem basis on the first Annual Rent payment and shall be paid by Tenant to
Landlord for such month.
(d) Sales/Use Tax.
Tenant shall also pay to Landlord any sales and use tax imposed on any
Rents payable hereunder from time to time by state law or any other governmental
entity, which sums are due monthly.
(e) Late Charges.
In the event any installment of rent due hereunder (including Interim
Rent and Annual Rent) is not received by Landlord within ten (10) days of its
respective due date, there shall be an automatic late charge due to Landlord
from Tenant in the amount of five percent (5%) of such delinquent installment of
rent. All such late charges due hereunder shall be deemed additional Rent, and
are not penalties but rather are charges attributable to administrative and
collection costs arising out of such delinquency. In addition to such late
charge, in the event Landlord does not receive Rent when due hereunder, interest
at the rate of the maximum rate allowable by law shall be due and payable with
respect to such payment from the due date thereof until Landlord receives such
payment.
(f) Payments of Rents.
Except as provided in the following sentence, all Rent payments shall
be made by check payable to the order of Landlord and shall be sent to ▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, or to such other place or places as
Landlord or its successors or assigns, respectively, may from time to time
designate in writing. In the event Tenant is late in the payment of Interim,
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Annual or Percentage Rent on three (3) or more occasions, and if Landlord shall
so request, Tenant shall establish arrangements whereby Rent is transferred by
wire or other means directly from Tenant's bank account to such account as
Landlord may designate.
(g) No Abatement.
Unless otherwise stated in the Lease, no abatement, offset, diminution
or reduction (a) of Rent, charges or other compensation, or (b) of Tenant's
other obligations under this Lease shall be allowed to Tenant or any person
claiming under Tenant, under any circumstances or for any reason whatsoever.
Initialed for Identification:
-----------------------------------
By Landlord
------------------------------------
By Tenant
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CONSTRUCTION ADDENDUM
THIS CONSTRUCTION ADDENDUM, executed as of (Closing Date), by and
between CNL __________, a (State of Registration) (Landlord Entity Type) with
principal office and place of business at ▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇ ("Landlord"), and (TENANT NAME), a (State of Incorporation) (Tenant Entity
Type), with a mailing address of (Tenant Street Address), (Tenant Street
Address), (Tenant City), (Tenant State) (Tenant Zip) ("Tenant").
PRELIMINARY STATEMENT
Landlord has acquired the real property which constitutes a portion of
the Premises described in Exhibit "A" attached to the Lease Agreement and has
leased the same to Tenant under the terms of the Lease Agreement. Landlord
desires to construct or have constructed certain improvements on the Premises
and is entering into this Construction Addendum with Tenant for the purpose of
setting forth the terms and conditions under which Tenant shall serve as
developer in connection with the Project (as that term is defined hereinbelow).
NOW, THEREFORE, it is agreed, by and between the parties hereto as
follows:
1. Definitions. Capitalized terms used in the Lease Agreement shall
have the same meaning in this Construction Addendum unless otherwise defined. In
addition to those terms defined elsewhere in this Construction Addendum, as used
herein the following terms shall have the meaning indicated:
"Project" shall mean construction of the building and all necessary
site improvements on the Premises for the initial use as a ___________ health
care facility by Tenant who is Tenant under the Lease Agreement between Tenant
and Landlord of even date herewith (the "Lease Agreement"). Such building and
improvements shall be completed in accordance with the plans and specifications
approved by Landlord and Tenant prior to Landlord's acquisition of the Premises,
which approval shall not be unreasonably withheld, delayed or conditioned.
"Construction Period" shall mean the period beginning on the Effective
Date and ending on the earliest of (i) _____________ (___) days after the
Effective Date; (ii) the date a certificate of occupancy for the Premises is
issued; (iii) the date the __________ health care facility opens for business on
the Premises; and (iv) the date Tenant receives from Landlord its final funding
of the construction costs for the Project under this Construction Addendum.
2. Authorization, Independent Contractor. Landlord hereby engages
Tenant as an independent contractor and authorizes Tenant to enter upon the
Premises and to undertake responsibilities, duties, obligations, rights and
authority expressly herein set forth and, subject to the provisions hereof,
Tenant hereby accepts such appointment and agrees to perform and fully discharge
all of its duties, responsibilities and obligations herein set forth diligently,
promptly and in full compliance with the provisions hereof.
3. Co-Tenant and Sub-Agents. Tenant may delegate the performance of any
of its responsibilities hereunder to one or more contractors, subcontractors,
consultants, co-developers or sub-agents; provided, however, that no such
delegation shall relieve Tenant of its duties, responsibilities and obligations
hereunder.
4. Specific Duties and Obligations. Tenant shall be responsible for the
complete development and construction of the Project and shall deliver a
turn-key facility to Landlord. In that connection, Tenant's duties, obligations
and responsibilities include, but shall not be limited to the following:
(a) Project Design. Procuring all necessary architectural and
engineering services related to the site work, design and engineering related to
the Project, any and all engineering and impact studies or reports related to
the development of the Project, and processing and obtaining all required
governmental approvals.
(b) Licenses and Permits. Obtaining all licenses, permits and
approvals required to prepare the site for development, to permit construction
of the Project and to operate it for its intended purposes. Such licenses,
permits and approvals shall include, but shall not be limited to, water
management district approvals, approvals required under any franchise agreement,
financing agreement or any instrument of record, building permits, certificates
of occupancy, and any other required governmental consents or approvals.
(c) General Contractor, Construction Contracts and Purchase
Orders. Negotiating all necessary construction contracts, for the benefit of
Landlord, relating to the development and construction of the Project. All
construction contracts and purchase orders for work, material or equipment shall
be entered into between Tenant and the contractors or vendors selected and shall
be satisfactory in form and substance to Landlord, Tenant, and legal counsel for
Landlord and Tenant, including a payment and performance bond from the general
contractor in the amount of the general construction contract. The general
construction contract and construction/trade cost breakdown shall be approved by
Landlord prior to Landlord's purchase of the property. The general construction
contract shall contain provisions for a ten percent (10%) retainage and
submission to Landlord of all underlying contracts with and invoices (required
only if a cost-plus contract) from materialmen and subcontractors. All change
orders to such contract must be approved in writing by Landlord. Tenant shall
cause its general contractor to submit (and the general construction contract
shall so provide) all subcontracts to Landlord prior to commencement of
construction.
(d) Construction Coordination. Coordinating all aspects of
construction of the Project to completion. Tenant shall monitor the progress of
construction and the compliance by all contractors with the provisions of their
construction contracts, through periodic on-site visits and inspections and
through written and other reports from the architect, contractors and other
construction supervisory personnel. Tenant shall keep Landlord advised from time
to time of the progress of construction. Tenant shall review and approve all
contractor and other payment requests made from time to time and shall review
all such requests to ensure compliance with the
2
construction contract and the terms hereof. Tenant shall determine which, if
any, contractor or subcontractor is in default under the provisions of its
applicable contract or subcontract, and what measures should be taken in
connection therewith.
(e) Funding. Financing to be provided by Landlord hereunder
shall be limited to all actual "hard" construction costs of the Project together
with approved "soft" costs (to the extent set forth herein), exclusive of any
developer's fee. Landlord's funding shall be disbursed to Tenant monthly against
draw requests submitted by Tenant to Landlord. Each such draw request shall be
submitted on AIA Forms G-702 and G-703 (or other forms approved by Landlord),
shall be prepared in accordance with Landlord's instructions and shall be
received by Landlord no later than the twenty-fifth (25th) day of each month.
Each draw request shall be accompanied by all supporting documentation required
by Landlord (including partial lien waivers from the general contractor and all
subcontractors waiving all lien rights through the date of the last draw
request, and copies of invoices for "soft" costs which may be reimbursable). If
properly prepared and documented requests are received by the twenty-fifth
(25th) day of a month, Landlord shall pay proper amounts reflected in such
request by the tenth (10th) day of the following month. The funds to be advanced
by Landlord pursuant to this Construction Addendum shall at no time in the
aggregate exceed $________________ (the "Funding Limitation"), minus the
purchase price Landlord paid at closing for the acquisition of the Premises,
including Landlord's acquisition costs and closing costs. Tenant shall be solely
responsible for the full and timely payment of any and all costs of developing
the Project which exceed the Funding Limitation determined hereinabove. If, at
any time after the date hereof, there exists any unpaid costs in excess of the
Funding Limitation, then Landlord shall have the right to immediately stop
funding under this Construction Addendum until such time as Tenant has funded
such excess costs and has provided Landlord with evidence that such excess costs
have been paid in full by Tenant. Tenant shall obtain no construction financing
for the Project which is secured by a lien on the Project. Construction
financing shall not include equipment financing.
(f) General Construction Matters. Tenant shall commence
construction as soon as practicable after the date hereof and, after
commencement and subject to Paragraph 9 hereinbelow, shall diligently complete
the Project within __________ (___) days thereafter in a first-class,
workmanlike manner and in conformity with all applicable governmental laws,
ordinances, rules, orders, regulations and other requirements and in substantial
compliance with the plans and specifications approved by Landlord, Tenant's
franchisor and the final working drawings. Notwithstanding the foregoing,
Landlord agrees to consider reasonable written requests from Tenant for
extensions of time to complete the Project beyond the __________(___) day
period.
All of Tenant's records pertaining to the construction of the
Project shall be available for inspection and copying by Landlord and its agents
and employees during normal business hours. Following completion of the Project,
Tenant shall execute such documents and instruments as Landlord may request (in
form and substance reasonably satisfactory to Landlord and Tenant) to evidence
Landlord's ownership of and title to all improvements on the Premises
3
comprising, in the aggregate, the Project and shall assign to Landlord all
warranties relating to the work and/or materials performed at or incorporated
into the Project.
Tenant shall as part of the construction and development work
engage an inspecting architect or engineer suitable to Landlord to make monthly
inspections and to certify all draw requests to Landlord. Such certification
shall include a statement of work done if not reasonably ascertainable from the
draw request and shall be accompanied by color photographs in no less than 3
1/2" by 5" formats showing the construction work completed as of the inspection
date. Such photographs shall be taken from such vantage points as are required
to clearly show all work done and once vertical construction has commenced shall
show all elevations. The final draw request shall be accompanied by: (1) the
contractor's affidavit of completion and proof of payment of all subcontractors
and all materialmen; (2) an assignment of all manufacturer's warranties for any
material, equipment or workmanship installed as a part of the Project; (3) an
ALTA as-built survey of completed Project certified to Landlord and Tenant, and
any title company designated by Landlord; (4) Certificate(s) of Occupancy for
the Project issued by the appropriate regulatory agencies; and (5) a complete
certified final set of plans, specifications and working drawings for the
Project as completed. At the time such draw request is submitted to Landlord,
Landlord shall order or cause to be ordered an update search or endorsement to
its title insurance policy for the Premises, which must show no additional
matters of record through a then current date (except for matters which have
been previously accepted by Landlord).
No approvals or inspections made, given or conducted by
Landlord shall relieve Tenant of any duties, responsibilities, obligations or
liabilities hereunder.
5. Development Fee. Neither Tenant nor any affiliate shall receive a
development or construction supervision fee for its services hereunder. A
licensed general contractor shall be entitled to reasonable, normal and
customary overhead and profit in connection with the performance of its services
under a general construction contract. Said profit shall include reasonable,
normal and customary superintendent compensation.
6. General. With respect to matters not specifically related to the
Premises or its development, this Construction Addendum shall be governed by the
laws of the state where the Premises is located. All captions and section
headings used herein are for convenience and ease of reference only and do not
constitute part of this instrument. The Preliminary Statement set forth at the
beginning of this Construction Addendum is hereby incorporated herein by
reference and is deemed to constitute an integral part of this instrument.
7. Landlord's Right to Complete Construction on Tenant's Default.
Except for delays caused by events not within the control of Tenant, failure to
continuously prosecute to completion the construction of the Project within
____________ (___) days following the date hereof shall constitute a default by
Tenant hereunder. If, after ten (10) days notice to Tenant, any such default
shall not have been remedied, then Landlord may, if it elects to do so, either:
(a) take over construction of the Project and, at its option, complete such
construction or cause the same to be completed, or (b) terminate the Lease
Agreement and this Construction Addendum, in
4
which case Tenant shall be required to purchase the Premises from Landlord
(subject to all liens, claims or encumbrances not placed on the Premises by
Landlord) at a price equal to Landlord's purchase price of the Premises, plus
all sums disbursed to Tenant pursuant to this Construction Addendum, plus all
Interim Rent due under the Lease Agreement, plus all fees, costs and expenses
paid by Landlord in connection with its purchase of the Premises, plus interest
on all such sums accruing from the date of disbursement thereof at the rate of
ten percent (10%) per annum. Closing of such purchase and sale shall take place
within thirty (30) days following the date of Landlord's notice of default to
Tenant.
8. Force Majeure. The time for completion of the Project shall be
extended by the period of time, if any, that construction is delayed by virtue
of labor unrest, materials shortage, natural disaster, weather, Acts of God, and
other causes beyond the reasonable control of Tenant; provided, however, that no
such extension shall be permitted with respect to any delay unless written
notice of the delay specifying the cause of the delay and the expected time of
the delay is delivered to Landlord within fifteen (15) days after such delay is
encountered.
9. Entire Agreement. This Construction Addendum and the Lease Agreement
of which this Construction Addendum is a part constitute the entire agreement of
Landlord and Tenant with respect to the development of the Premises, and
supersedes any prior or contemporaneous agreement with respect thereto. No
amendment or modification of this Construction Addendum shall be binding upon
the parties unless made in writing and signed by both Landlord and Tenant.
(Signatures begin on next page)
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IN WITNESS WHEREOF, Landlord and Tenant have caused this Construction
Addendum to be executed and sealed as of the date first above written.
Signed, Sealed and Delivered
in the presence of: "LANDLORD"
CNL _______________________, a
__________________ corporation
----------------------------
By:
Name: --------------------------
------------------------
----------------------------
Name:
-----------------------
STATE OF FLORIDA
COUNTY OF ORANGE
The foregoing instrument was acknowledged before me this ____ day of
_______________, 1998 by ____________________, as ______________________ of CNL
_____________________, a ____________________, on behalf of the
_______________________. He is personally known to me and did not take an oath.
-----------------------------------
Notary Signature
-----------------------------------
Printed Name
Notary Public, State of Florida
Commission Number:
-----------------
My Commission Number:
--------------
6
"TENANT"
(TENANT NAME), a (State of
Incorporation) (Tenant Entity Type)
----------------------- By:
-----------------------------
Name: Name:
------------------ -----------------------------
As Its:
-----------------------------
-----------------------
Name:
-----------------------
STATE OF ______________
COUNTY OF ____________
The foregoing was executed before me on , 1998 by
_______________________________ as ____________________________ of
__________________________________, a __________ corporation, on behalf of the
corporation. He/She is personally known to me or produced
_____________________________________________________________ as identification
and did not take an oath.
------------------------------------------
(NOTARY SEAL) Notary Public, State of
-------------------
Printed Name:
-----------------------------
Notary Commission No.
---------------------
My Commission Expires:
--------------------
EXHIBITS ATTACHED
Exhibit "A" - Legal Description
7
REQUESTED BY:
AFTER RECORDATION RETURN TO:
(Attorney's Name and Address)
------------------------------
------------------------------
------------------------------
------------------------------
RETURN BY: MAIL (X) PICK UP ( )
_________ #(Site Number)/(City), (County) County, (State)
MEMORANDUM OF LEASE
This Memorandum of Lease is made as of (Closing Date), by and between
CNL __________, a (State of Registration) (Landlord Entity Type) with principal
office and place of business at ▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
("Landlord"), and (TENANT NAME), a (State of Incorporation) (Tenant Entity
Type), with a mailing address of (Tenant Street Address), (Tenant Street
Address), (Tenant City), (Tenant State) (Tenant Zip) ("Tenant").
In consideration of ONE AND NO/100 DOLLARS ($1.00) and other valuable
consideration paid by Tenant to Landlord and the mutual covenants contained in
that certain Lease Agreement between the parties hereto dated on even date
herewith (hereinafter called the "Lease"), Landlord has leased and does hereby
lease to Tenant, and Tenant has hired and does hereby hire from landlord, upon
the terms and conditions set forth in said Lease, the real property more
particularly described in Exhibit "A" attached hereto and made a part hereof
(the "Premises").
The term of the Lease is __________ (__) years commencing on the date
hereof and ending on _______ ___, 20__. Said Lease provides for options to renew
for _________ (__) five (5) year terms. Tenant shall not allow any mechanic's
lien or similar type of lien to be filed against the Premises. Tenant has the
first right of refusal to purchase the Premises and an option to purchase the
Premises during the term of the Lease and any renewals or extensions thereof
upon the terms and conditions set forth in the Lease.
(Signatures begin on next page)
IN WITNESS WHEREOF, Landlord and Tenant have caused this Memorandum of
Lease to be executed and sealed as of the date first above written.
Signed, Sealed and Delivered
in the presence of: "LANDLORD"
CNL ________________________, a
__________________ corporation
------------------------
Name: By:
-------------------- ----------------------------
------------------------
Name:
--------------------
STATE OF FLORIDA
COUNTY OF ORANGE
The foregoing instrument was acknowledged before me this ____ day of
_______________, 1998 by ____________________, as ______________________ of CNL
_____________________, a ____________________, on behalf of the
_______________________. He is personally known to me and did not take an oath.
----------------------------
Notary Signature
----------------------------
Printed Name
Notary Public, State of Florida
Commission Number:
------------
My Commission Number:
----------
2
"TENANT"
(TENANT NAME), a (State of
Incorporation) (Tenant Entity Type)
------------------------ By:
Name: ---------------------------------
----------------------
---------------------------------
Name:
---------------------------------
As Its:
----------------------------------
-----------------------
Name:
-------------------
STATE OF ______________
COUNTY OF ____________
The foregoing was executed before me on , 1998 by
_______________________________ as ____________________________ of
__________________________________, a __________ corporation, on behalf of the
corporation. He/She is personally known to me or produced
______________________________________________________________ as identification
and did not take an oath.
-------------------------------
(NOTARY SEAL) Notary Public, State of
--------
Printed Name:
------------------
Notary Commission No.
------------
My Commission Expires:
-----------
3