LEASE
This lease ("Lease") is entered into on February 21, 2002 between Sacramento
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County Assisted, LLC ("Landlord"), and RAL, Inc. ("Tenant"), with reference to
the following facts:
1. Landlord is in the processing of acquiring title to the premises
hereinafter described, together with the fixtures and equipment therein and
Tenant has agreed as part of that acquisition transaction to transfer
operational responsibility for the Facility to Landlord at such time as Landlord
and/or its designee is licensed to operate the residential care facility for the
elderly located on the premises.
II. Tenant has agreed to lease the premises and the furniture, fixtures and
equipment therein back from Landlord pursuant to the provisions of this Lease,
for the purpose of operating the residential care facility for the elderly
located on the premises for the benefit of Landlord until such time as Landlord
and/or its designee is licensed to operate the same.
III. Landlord and Tenant are interested in documenting the terms and conditions
under which Tenant will lease and operate the residential care facility for the
elderly located on the premises owned by Landlord. ^l
NO','. THEREFORE, in consideration of the foregoing premises and the mutual
covenants of the parties set forth herein, THE PARTIES HEREBY AGREE AS FOLLOWS:
ARTICLE 1
DEFINITIONS
As used in this Lease, the following words and phrases shall have the following
meanings:
1.1. "Alteration" - any addition, change or modification, structural and
nonstructural, to the Premises (as such term is defined in Section 2.1 below)
made by Tenant including, without limitation, fixtures.
1.2 "Authorized Representative," - any officer, agent, employee or
independent contractor retained or employed by either party, acting within
authority, actual or apparent, given him by that party.
1.3 Reserved.
1.4 "Encumbrance" - any land sale contract, deed of trust, mortgage, or
other written security device or agreement affecting the Premises and/or
Personal Property (as such term is defined in Section 2.1 below), and the note
or other obligation secured by it, that constitutes security for the payment of
a debt or performance of an obligation.
1.5 "Hazardous Substances" - as defined in Section 8.2.6 of this Lease.
1.6 "Hold Harmless" - to defend and indemnify from all liability, losses,
penalties, damages, costs, expenses (including, without limitation, attorneys'
fees), causes of action, claims, or judgments arising out of or related to any
damage to any person or property.
1.7 "Landlord" -Sacramento County Assisted LLC, its Successors (as defined
in Section 1.16 below), and any person or entity succeeding to the rights of
Landlord by reason of an ownership interest or a security interest in the
FACILITY (AS DEFINED IN SECTION 2.1 below) including, without limitation, any
Lender (as DEFINED IN SECTION 1.12 BELOW) of Landlord.
1.8 Law" - any judicial decision, statute, constitution, ordinance, resolution,
regulation, rule, administrative order. or other requirement of any municipal,
county, state, federal, or other government agency or authority having
jurisdiction over the parties or the Facility, or both, in effect whether at the
time of execution of the Lease or at any time during the term, including without
limitation; any regulation or order of a quasi-official entity or body.
1.9 "Lease Year" - the twelve-month period commencing on the Commencement
Date (as defined in Section 3.1 below) and on each succeeding anniversary of the
Commencement Date during the teen (and any extended term) of the Lease.
1.10 "Lender" - a beneficiary, mortgagee, secured party, or other holder of
an Encumbrance on the Facility or any part thereof.
1.11 "Rent" - monthly rent, additional rent, late fees, security deposit,
utility charges, real and personal property taxes and assessments, insurance
premiums, and all other charges payable by Tenant to Landlord or any third
person pursuant to the provisions of this Lease.
1.12 "Rent Adjustment Date" - The first day of each Lease Year other than
the Commencement Date.
1.13 "Restoration" the reconstruction, rebuilding, rehabilitation and
repairs . that are necessary to return damaged or destroyed portions of the
Facility and other property related to the operation of the Facility to
substantially the same physical condition as they were in immediately before the
damage or destruction.
1.14 "Successor" any permitted assignee, transferee or other person or
entity succeeding lawfully, and pursuant to the provisions of this Lease, to the
rights and obligations of either party.
ARTICLE 2
DESCRIPTION
2.1 Subject to the terms and conditions contained herein, Landlord hereby
leases to Tenant and Tenant hereby leases from Landlord the real property
located at 000 Xxxxxxxxxx Xxx, Xxxxxx XX and more fully described in Exhibit
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Attached hereto, together with all improvements now or hereafter located
thereon. commonly known as of the date of the execution of this Lease as Regent
at Willow Creek (the "Premises"), and that certain personal property (furniture,
fixtures, equipment and inventory) located in the Premises and described in
Exhibit B attached hereto and any replacements thereof (the "F, F & E"). The
Premises and the F, F & E are sometimes hereinafter collectively referred to as
the "Facility.".
2.2 Landlord is informed that the Facility is presently licensed by the
state of California to operate as a 130 unit residential care facility for the
elderly and that the Facility is not currently certified to participate in
Medicare or Medi-Cal. Reference hereinafter to the "Licensed Facility" shall
mean the Facility as so licensed.
ARTICLE 3
TERM
3.1 The term of this Lease (the "Term") shall commence on the day Landlord
acquires title to the Facility ("Commencement Date") and shall terminate at
midnight on the earlier to occur of July 31, 2002 (the "Outside Date") or the
day prior to the date on which Landlord and its manager, Emeritus Corporation
("Emeritus") or another operator designated by Landlord, are licensed to operate
the Facility by the State of California (the "Lease Termination Date");
provided, however, that if the Commencement Date shall not have occurred by the
Outside Date and as of the Outside Date, the license application has been filed
and is being processed by the State of California, then Landlord may extend the
Outside Date for ninety (90) days, which extension shall occur automatically
unless Landlord gives notice on or before the Outside Date electing not to have
this extension. Tenant shall have no right to extend this Lease beyond the Term
provided for herein. Upon the Commencement Date being ascertained, it shall be
inserted in the space provided below anal initialed by the parties.
Commencement Date:
Landlord Tenant
3.2 If Landlord has not acquired the Facility by February 28, 2002, then
this Lease shall be void and of no effect unless the parties extend the
Commencement Date by written amendment to this Lease. Should this Lease become
void by virtue of the foregoing provision, Landlord shall return to Tenant any
advance rent and security deposit previously paid to Landlord.
ARTICLE 4
WARRANTIES
4.1 LANDLORD HAS MADE NO REPRESENTATION TS OR
WARRANTIES, EXPRESS OR IMPLIED; NOR DOES LANDLORD MAKE ANY
HEREIN REGARDING THE CONDITION OF THE FACILITY OR ANY PART
THEREOF INCLUDING WITHOUT LIMITATION THE STRUCTURAL,
SOUNDNESS THEREOF, THE. PRESENCE OR ABSENCE OF HAZARDOUS
SUBSTANCES OR THE FACILITY'S FITNESS FOR ANY PARTICULAR USE OR
OCCUPANCY. LANDLORD FURTHER HEREBY SPECIFICALLY DISCLAIMS
ANY REPRESENTATIONS AND/OR WARRANTIES, BOTH EXPRESS AND
IMPLIED IN LAW, WITH RESPECT TO THE CONDITION, HABITABILITY, OR
SUITABILITY OF THE FACILITY, OR ANY PART THEREOF, FOR THE USE AND
PURPOSES PERMITTED HEREUNDER OR ANY OTHER PURPOSE, AND
LANDLORD DOES NOT REPRESENT T OR WARRANT THAT THE FACILITY OR
A NY PART THEREOF COMPLIES WITH ARTY LAWS RELATING TO THE USES
AND OCCUPANCY THEREOF. TENANT FULLY UNDERSTANDS THAT THERE
MAY BE CERTAIN ALTERATIONS, REPAIRS AND REPLACEMENTS
REQUIRED TO CAUSE THE FACILITY TO COMPLY WITH APPLICABLE LAW
(AS THE SAME MAY BE MODIFIED FROM TIME TO TIME THROUGHOUT THE
TERM HEREOF) AND FOR THE CONTINUED LICENSING OF THE FACILITY,
AMID TENANT SHALL BE FULLY RESPONSIBLE FOR THE COST OF AND FOR
EFFECTUATING ANY AND ALL ALTERATIONS, REPAIRS AND
REPLACEMENTS REQUIRED TO BE MADE TO CAUSE THE FACILITY TO
COMPLY WITH APPLICABLE LAW AND FOR THE CONTINUED LICENSING OF
THE FACILITY AS WELL AS ALL ALTERATIONS. REPAIRS AND
REPLACEMENTS REQUIRED TO MAINTAIN AND PRESERVE THE FACILITY IN
THE CONDITION CALLED FOR HEREIN. TENANT ACKNOWLEDGES THAT
LANDLORD IS NOT RESPONSIBLE FOR AND TENANT SHALL HOLD
LANDLORD HARMLESS IN CONNECTION WITH ANY SUCH ALTERATIONS,
REPAIRS AND REPLACEMENTS TO THE FACILITY FOR ANY REASON
WHATSOEVER.
Initials of Tenant: WT
5.1 Tenant shall pay Landlord a monthly rent ("Base Monthly Rent") during
each month of the Lease Year, without deduction, set off, prior notice or
demand. Base Monthly Rent for the term of the Lease is ONE HUNDRED and no/I00
Dollars ($100.00).
5.2 Base Monthly Rent shall be paid on the first day of each month commencing
with the month in which the term of this Lease commences. If the Commencement
Date is on a day other than the first day of a month, Base Monthly Rent for such
partial month shall be prorated at the rate of 1/30th of the Base Monthly Rent
per day.
5.3 All Rent shall be paid in advance to Landlord at 0000 Xxxxx Xxxxxx,
Xxxxx 000, Xxxxxxx XX 00000 or at such other address as may be designated by
Landlord from time to time in writing to Tenant. Rent not paid when due shall
bear interest from the date due until paid at the maximum rate permitted by law,
or if no maximum rate is applicable, at the rate of IS% per annum.
5.4 Tenant acknowledges that late payment of Rent will cause Landlord to
incur damages and costs not contemplated by this Lease, the exact amount of
which would be extremely difficult and impracticable to ascertain. Such costs
include, without limitation, processing and accounting charges, administrative
costs, loss of use of funds and late charges that may be imposed on Landlord by
the terms of any Encumbrance. Therefore, if any installment of Rent is not
received by Landlord within ten (10) days after its due date, Tenant shall pay
to Landlord an additional sum equal to five percent (5 %) of the overdue Rent as
a late charge, unless applicable law requires a lesser late charge, in which
case Tenant shall pay the maximum late charge permitted by law. The parties
agree that this late charge represents a fair and reasonable estimate of the
additional costs that Landlord will incur by reason of late payment by Tenant.
Acceptance of any late charge shall not constitute a waiver of Tenant's default
with respect to the overdue amount, nor prevent Landlord from exercising any of
the other rights and remedies available to Landlord hereunder, at law or in
equity.
5.5 Base Monthly Rent provided in this Lease shall be in addition to all
other payments to be made by Tenant as provided herein. It is the purpose and
intent of Landlord and Tenant that the Base Monthly Rent provided herein shall
be absolutely net to Landlord so that this Lease shall yield net to Landlord the
Base Monthly Rent specified in this Lease in each month during the Term of this
Lease and Landlord shall have no obligation or liability to pay any amounts in
connection with the ownership, operation and/or management of the Facility or
any part thereof, including but not limited to real and personal property taxes,
insurance premiums, maintenance, including but not limited to structural or
exterior maintenance, license fees, and any costs incurred by Landlord or for
which Landlord is responsible by virtue of the existence of any financing on the
Facility (including but not limited to any tax imposed on a Lender by reason of
its having made a loan to Landlord but not including points; fees, or other
costs incurred in making a new loan or refinancing an existing loan), of any
kind or nature whatsoever. Excluding Encumbrances for which Landlord is liable,
all costs and expenses including, without limitation, taxes, assessments,
insurance premiums, maintenance, license fees and obligations of every kind and
nature whatsoever relating to the use and/or management of the Facility by
Tenant which may accrue or become due during or out of the Term hereof shall be
paid by Tenant and Landlord shall be indemnified
and held harmless by Tenant from and against the same,
ARTICLE 6
RESERVED
ARTICLE 7
TAXES AND ASSESSMENTS
7.1 Tenant shall be responsible for the payment of all taxes, assessments.
license fees, and other charges ("Personal Property Taxes") that are levied and
assessed against all personal property, including but not limited to leasehold
improvements, furniture, fixtures and equipment installed, whether by Landlord
or Tenant, or located in or about the Premises, which taxes accrue during the
Term, regardless of when the same may be payable.
7.2 Tenant shall be responsible for the payment of all real property taxes,
assessments and levies, both general and special ("Real Property Taxes") which
are or are hereafter levied, assessed, or are otherwise imposed, against the
Premises during the Term, regardless of when the same may be payable.
7.3 Tenant shall pay to Landlord (or to Landlord's Lender, as Landlord may
direct), together with and in addition to the monthly payments of rental and
other payments payable under the terms of this Lease, on the dates set forth
herein for the making of monthly rental payments, until the end of the Term, a
sum, as estimated by Landlord, equal to the Personal Property Taxes and Real
Property Taxes (collectively "Taxes") next coming due with respect to the
Premises, including any personal property included therein, divided by the
number of months to elapse before one month prior to the date when such Taxes
will become delinquent, such sums to be held by Landlord (or Landlord's Lender,
if Tenant has been directed to pay the same to Landlord's Lender) to pay such
Taxes. Such payments, hereinafter referred to as "Reserves", are to be held
without any allowance of interest or dividend to Tenant and need not be kept
separate and apart from other funds of Landlord or Landlord's Lender, as
applicable. All payments mentioned in this section and all payments to be made
under the Lease shall be added together and the aggregate amount thereof shall
be paid by Tenant each month in a single payment. The arrangement provided for
in this section is solely for the added protection of Landlord and entails no
responsibility on Landlord's part beyond the allowing of due credit, without
interest, for the sums actually received by it. Upon assignment of the Lease by
Landlord or upon any assignment by Landlord's Lender of its loan, any funds then
held by Landlord or Landlord's Lender shall be turned over to Landlord's or
Landlord's Lender's Successor, as applicable, and any responsibility of Landlord
or Landlord's Lender with respect thereto shall terminate. If the total of the
Reserves hereof shall exceed the amount of payments actually applied by Landlord
or Landlord's Lender, as applicable, such excess may be credited by Landlord or
Landlord's Lender, as applicable, on subsequent payments to be made by Tenant
or, at the option of Landlord, refunded to Tenant or its Successors. If,
however, the Reserves shall not be sufficient to pay the sums required when the
same shall become due and payable, Tenant shall immediately deposit with
Landlord or, if so directed by Landlord, with Landlord's Lender, the full amount
of any such deficiency. If there shall be a default under any of the provisions
of this Lease, Landlord may use, apply or retain, to cure such DEFAULT and to
compensate Landlord for all damage sustained by Landlord as a result of such
default, at any time, all or any part of the Reserves held by Landlord, and upon
demand of Landlord, Tenant shall immediately deposit with Landlord a sum equal
to the portion of the Reserves so used, applied or retained by Landlord.
7.4 Tenant's liability to pay Taxes shall be prorated on the basis of a
365-day year to account for any fractional portion of a tax year included in the
Term at its commencement and expiration. Prorations shall be based on
assessments and Tenant shall pay such prorations when the prorated tax
installment becomes due.
7.5 Tenant shall have the right to contest or review by legal
proceeding, or in such other manner as it may deem suitable (which, if
instituted, Tenant shall conduct promptly at its own expense, and free of any
expense to Landlord, and if necessary, in the name of Landlord) any Taxes.
Tenant may defer payment of a contested item upon condition that; before
instituting any such proceeding, Tenant shall furnish to Landlord, or to any
Lender Landlord may designate, security reasonably satisfactory to Landlord and
such Lender sufficient to cover the amount of any Taxes. Notwithstanding the
furnishing of any such security, Tenant shall promptly pay such contested item
if at any time the Facility or any part thereof shall be in danger of being sold
or forfeited. The legal proceeding herein referred to shall include an
appropriate proceeding to review tax assessments and appeals from any judgment,
decree, or order in connection therewith, but such proceeding shall be commenced
as soon as possible after the assessment of any contested item and shall be
prosecuted to final adjudication with dispatch. If there shall be any refund
with respect to any contested item based on a payment by Tenant, provided Tenant
is not then in default of its obligations hereunder, Tenant shall be entitled to
such refund to the extent of such payment.
7.6 Tenant shall, in addition to all other sums, pay all fees for
inspection and examination of the Facility during the Term hereof which are
charged by any public authority having jurisdiction thereof.
7.7 Tenant shall not be required to pay any municipal, county, state,
or federal income or franchise taxes of Landlord, or any municipal, county,
state, or federal estate, succession, inheritance, or (except as provided below)
transfer taxes of Landlord. If at any time during the Term, the state in which
the Facility is located or any political subdivision of such state, including
any county, city; public corporation, district, or any other political entity or
public corporation of such state, levies or assesses against Landlord a tax,
fee, or excise on (1) rents, (2) the square footage of the Premises, (3) the act
of entering into this Lease, or (4) the occupancy of Tenant, or levies or
assesses against Landlord any other tax, fee, or excise, however described,
including, without limitation, a so-called value added tax, as a direct
substitution in whole or in part for, or its addition to, any Real Property
Taxes, Tenant shall pay before, delinquency that tax, fee, or excise.
Notwithstanding the above, if a transfer tax is payable to any governmental
agency or agencies as a result of this Lease, Tenant shall, to the extent
permitted by law, pay the same directly to the taxing authority or authorities
when it is due, or at Landlord's election, Tenant shall pay same to Landlord
within ten (10) days after notice to Tenant from Landlord, and in such event,
Landlord shall pay the tax following receipt from Tenant.
ARTICLE 8
USE
8.1 Tenant shall use the Facility for a 130 unit licensed residential
care facility for the elderly and for no other use without Landlord's prior
written consent, which consent may be withheld in Landlord's sole and absolute
discretion.
8.2 Tenant's use of the Facility as provided in this Lease SHALL BE IN
ACCORDANCE with the following:
8.2.1 Tenant shall not do, bring, or keep, or permit to be done, brought or
kept, anything in, on or about the Premises that may cause an invalidation or
cancellation of any insurance covering the Facility, and Tenant shall comply
with all requirements imposed by any company issuing such insurance.
8.2.2 Tenant shall cause the Facility to be and remain licensed for 130
units by the applicable. state and/or local governmental agencies and shall
maintain such license during the Term of this Lease. At Tenant's sole expense,
Tenant shall cause the Facility to conform to the requirements and provisions of
all applicable laws concerning the use of the Facility as so licensed including,
without limitation, the obligation at Tenant's sole cost to alter, maintain,
replace or restore the Facility or any part thereof in compliance and conformity
with all laws relating to the condition, use or occupancy of the Facility as so
licensed.
8.2.3 Tenant. shall not use the Facility in any manner that will constitute
nuisance, waste to the Facility, or cause unreasonable annoyance to owners or
occupants of adjacent properties.
8.2.4 Tenant shall not do or permit to be done anything on the Premises
that will cause damage to the Facility or any part thereof. The Premises shall
not be overloaded with furniture, equipment or machinery in such manner that
damage is caused to the Premises or any part thereof. No machinery, apparatus or
other appliance shall be used or operated in, on or about the Premises that will
in any manner injure the Facility- or any part thereof.
8.2.5 Tenant shall pay all payrolls promptly when due respecting any
personnel employed by it at the Facility, and shall file all governmental
reports required pursuant thereto (including, without limitation, payroll tax
returns) and shall pay such payroll and related taxes promptly and before
delinquency.
8.2.6 (a) Tenant shall not bring, release, use, generate, manufacture,
store or dispose of, or permit to be brought, released, used, generated,
manufactured, stored or disposed of, on, under or about the Facility, or
transfer or permit to be transferred to or from the Facility, any asbestos,
asbestos containing materials, flammable explosives, radioactive materials,
hazardous wastes, toxic substances or related materials (collectively "Hazardous
Substances"). There is excluded from this prohibition Hazardous Substances of
the type commonly used in assisted living facilities, subject to the condition
that they are used, stored and disposed of in accordance with all applicable
law. As used in this Lease, Hazardous Substances shall include, but not be
limited to, substances defined as "hazardous substances", "hazardous materials",
or "toxic substances" in the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended, 42 U.S.C. Section 9601, et seq.; the
Hazardous Materials Transportation Act, 49 U.S.C. Section 1801 et seq.; the
Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq.; the
Clean Water Act, 33 U.S.C. Section 466 et seq.; the Safe Drinking and
Reauthorization Act of 1986, Public Lain 99-499, 100 Stat. 1613; the Toxic
Substances Control Act, 15 U.S.C. Section 2601 et seq., as amended; and those
materials and substances of a similar nature regulated or restricted under any
other laws now existing or hereafter adopted, and in regulations adopted and
publications promulgated pursuant to said laws, and under all applicable laws in
the State of California.
(b) If Tenant knows, or has reasonable cause to believe, that a
Hazardous Substance, or a condition involving or relating to the same, has come
to be located in, on or about the Facility, Tenant shall immediately give
written notice of such fact to Landlord.
(c) Tenant shall, at its sole cost and expense, promptly take all
investigatory and/or remedial action reasonably recommended, whether or not
formally ordered or required, for the clean-up of any contamination of, and for
the maintenance, security and or monitoring of, the Facility, the elements
surrounding the same, or neighboring properties, to the extent caused or
materially contributed to by Tenant, its agents, officers, directors or
employees, relating to or involving any Hazardous Substances brought onto and/or
released from the Facility.
(d) Tenant shall indemnify, protect, defend and hold Landlord, its
agents, employees, partners, members (including, in the case of a corporate
partner or member, such corporation's shareholders, officers and directors) and
Lenders, harmless from and against any and all damages, liabilities, judgments,
costs, claims, liens, expenses, penalties and attorney's and consultants' fees
arising out of or involving (i) any Hazardous Substances brought onto and/or
released from or onto the Facility by Tenant or its agents or employees and/or
(ii) Tenant's failure to perform any of its obligations under this Section
8.2.6. Tenant's obligations hereunder shall include, but not be limited to, the
effects of any contamination or injury to person, property or the environment
created or caused by Tenant, and the cost of investigation, removal,
remediation, restoration and/or abatement thereof, or of any removal,
remediation, restoration and/or abatement thereof and shall survive the
expiration or earlier termination of this Lease.
No termination, cancellation or release agreement entered into by Landlord
and Tenant
shall release Tenant from its obligations under this Lease with respect to
Hazardous
Substances, unless specifically so agreed by Landlord in writing at the
time of such
agreement.
8.2.7 Tenant shall comply with, and the leasehold created by this
Lease
is subject to, all covenants, conditions, restrictions, easements and
rights of way affecting
the Premises.
8.3. In connection with the operation of the Facility, Tenant's
use and
operation of the Facility shall at all times be subject to Landlord's prior
review and
approval of each of the following:
8.3.1. Operational Policies and Forms: All operational policies,
procedures, controls, and forms.
8.3.2. Charges: All recommended charges, including any and all
special
charges for services rendered to the residents at the Facility.
8.3.3. Information: All informational material, mass media
releases, and
other related publicity materials developed or used by Tenant in connection
with the
operation of the Facility.
8.3.4. Equipment and Improvements: All repairs, replacements and
maintenance to the Facility.
8.3.5. Personnel: All personnel decisions, including, but not limited to,
hiring, firing and staffing of the Facility.
8.3.6. Contracts. All contracts to which the Facility is a party.
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8.3.7. Marketing. All marketing plans and programs as well as advertising
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and promotion budgets.
8.4 Tenant's use and operation of the Facility shall also be subject to
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the following:
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8.4.1 Regulator, Compliance: Landlord's right to review of the regulatory
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compliance status of the Facility and the right to recommend actions to be taken
to ensure such compliance or correct any instances of non-compliance-
8.4.2 Collection of Accounts: Landlord's right to receive monthly aged ------
------- accounts receivable report and to review the collection efforts
undertaken by Tenant with respect to any overdue balances reflected thereon and
to make suggestions with respect to changes thereto.
8.4.3 Third Party, Notices and Claims: Landlord's right to receive copies
of all notices of claims or causes of action from any third party against Tenant
or the Facility within two (2) days of Tenant's receipt of same.
In no event shall Landlord's review and notice rights noted above impair,
reduce or otherwise alter Tenant's obligations hereunder.
ARTICLE 9
MAINTENANCE
9.1 Tenant shall, at its sole cost and expense, at all times during the
Term of this Lease, maintain the Premises and ever.- part thereof in good, clean
working order, condition and repair including, without limitation, the
structural portions of the building and improvements thereon, the interior and
exterior thereof, foundations, roofs, plate glass, wiring, plumbing, heat and
air conditioning units, mechanical systems, parking and service areas,
landscaping, the approaches thereto and appurtenances thereof, including all
adjacent sidewalks and alleys. Tenant's obligation to maintain the Premises
shall specifically include, without limitation, the obligation to make any and
all repairs, including, but not limited to, any and all repairs, alterations,
replacements and additions to the Facility required by law and/or as necessary
to obtain and maintain licensing as the Licensed Facility, and to repaint and/or
restain all painted and wood surfaces and restripe the parking areas as
required. Landlord shall not have any responsibility to maintain the Premises or
any part thereof including, without limitation, any structural or mechanical
maintenance, repair or replacement. Tenant waives all rights under any laws
which may provide for Tenant's right to make repairs and deduct the expenses of
such repairs from rent or to withhold rent or terminate the Lease based upon the
condition of the Premises.
9.2 Tenant shall, at its sole cost and expense, at all times during the
term of this Lease, keep and maintain the F, F & E , in good working order,
condition and repair. Tenant shall not remove the F, F & E, and/or replacements
thereof or any part thereof FRONT the Premises, without the prior written
consent of Landlord. Tenant shall purchase and replace with substitutes of equal
or higher quality any worn out or broken items of F, F & E from time to time
throughout the Term of this Lease with Landlord's prior written consent and at
Tenant's sole cost and expense. Items being replaced by Tenant may be removed
with Landlord's prior consent. The items being replaced and items replacing same
shall be and remain the property of Landlord. Tenant agrees, upon written
request from Landlord, to execute any and all documents necessary to assist
Landlord to fully evidence Landlord's ownership of the F, F & E.
ARTICLE 10
ALTERATIONS
Except in the event of an emergency, Tenant shall not make or allow to be
made any Alterations to the Premises or any part thereof without Landlord's
prior written consent. In the event Tenant intends to undertake any Alterations
to the Premises as
- provided in this Article, Tenant shall provide to Landlord written notice
describing the
nature of the Alterations, the estimated cost thereof and stating the date the
work related
to the Alterations is scheduled to commence. If any structural modifications are
to be
made as a part of such Alterations, then to the extent applicable, the
provisions of
Sections 16.9 and 16.10 shall apply to any requested Alterations as if the
Alteration
project was a Restoration. Landlord may impose such further conditions to its
consent as
it deems reasonably necessary, including the provision of Plans and
Specifications, the
assignment as security of any construction or related contracts AND/OR THE
DEPOSIT WITH
Landlord of the cost of such Alterations and the establishment of disbursal
procedures
with respect thereto. The failure of Landlord to respond within fifteen (15)
days after
Tenant notifies Landlord of its request for Landlord's consent to Alterations
shall be
deemed consent. Any Alterations made by Tenant shall remain on and be
surrendered
with the Premises on expiration or termination of the Term.
ARTICLE IL
MECHANIC'S LIENS
11.1 Tenant shall pay, when due, all costs for construction done by it
or caused to be done by it on the Premises. Tenant shall keep the Premises free
and clear of all mechanic's liens and other liens by reason of work, labor,
services or materials supplied or claimed to have been supplied to or for
Tenant, or anyone holding the Premises or any part thereof through or under
Tenant.
11.2 If Tenant shall, in good faith, contest the validity of any such
lien, then Tenant shall, at its sole cost and expense, indemnify, defend and
hold harmless Landlord, its agents, employees, partners (including, in the case
of a corporate partner, such corporation's shareholders, officers and directors)
and Lenders, against the same and shall pay and satisfy any adverse judgment
that may be rendered thereon before the enforcement thereof against such
parties. Tenant shall furnish to Landlord a surety bond satisfactory to Landlord
in an amount equal to one and one-half times the amount of the contested lien or
such other reasonable security as may be required by Landlord or its Lender to
ensure that the Facility remains free from the effect of such lien or claim and
shall indemnify Landlord and Landlord's Lender against liability for the same.
In addition, Landlord may require Tenant to pay Landlord's attorneys' fees and
costs in participating in such action if Landlord shall decide it is in its best
interest to do so.
11.3 If Tenant shall fail to discharge any such lien within ten (10)
days of its being filed or fails to famish reasonable security therefor as may
be required by Landlord or Landlord's Lender in accordance with the provisions
of Section 11.2, then, in addition to any other right or remedy of Landlord
resulting from Tenant's default, Landlord nay,
but shall not be obligated to, discharge the same either by paying the amount
claimed to be due, by procuring the discharge of such lien by giving security or
in such other manner as is or may be prescribed by law or practice of the state
in which the Facility is located. Tenant shall repay to Landlord, as additional
rent, on demand, all sums disbursed or deposited by Landlord pursuant to the
foregoing provisions of this Section 11.3 plus interest thereon at the then
maximum rate of interest permitted by law, or if no maximum rate then applies,
at the rate of 18% per annum. Nothing contained herein shall imply any consent
or agreement on the part of Landlord to subject Landlord's estate to liability
under any mechanic's or other lien law.
ARTICLE 12
UTILITIES AND SERVICES
Tenant shall make all arrangements, and prior to delinquency pay, for all
utilities and services furnished to the Facility or used by it, including,
without limitation, gas, electricity, water, telephone service, and trash
collection, and for all connection charges and deposits required by any of said
utilities. Landlord shall not be liable for any interruption in the provision of
any such utility services to the Facility.
ARTICLE 13
[INTENTIONALLY LEFT BLANK]
ARTICLE 14
INSURANCE
Tenant, at its sole cost and expense, shall maintain or cause to be
maintained at all times during the Term of this Lease, adequate insurance as
outlined below:
14.1. All Risk, or other broad form coverage property insurance, insuring
full replacement value. Such insurance shall also include, but not be limited
to, business interruption and extra expense coverage, for a period of not less
than six months. Tenant shall also maintain earthquake and flood hazard coverage
at an amount equal to full replacement cost of the Facility.
14.2 Commercial general liability insurance, against any third party
claims for bodily injury or property damage. Such insurance shall also include
coverage for contractual liability as respects this Agreement. Limits of such
coverage should not be less than 81,000,000 per occurrence with a minimum. of
52,000,000 per location aggregate.
14.3 Professional Liability Insurance with limits of such coverage that are
not less than $1,000,000 per occurrence, with a minimum of $2,000,000 per
location aggregate.
14.4 Business Auto Liability for third party bodily injury or property
damage for facility vehicles including owned, hired and non-owned auto liability
for $1,000,000 combined single limit. Coverage shall be extended to cover
physical damage to facility vehicles.
14.5 Umbrella/Excess Commercial General Liability and PROFESSIONAL SERVICES
Liability in the amount of $10,000,000 per occurrence.
14.6 Workers' Compensation coverage with statutory limits and Employers'
Liability insurance coverage with minimum limits of S 1;000,000 per occurrence.
14.7 Crime insurance to cover employee dishonesty, theft of money and
security loss in limits of not less than $1.000,000
14.8 Tenant shall provide, or shall cause to be provided, to Landlord
evidence of all insurance, naming Landlord as an additional insured on policies
14.2, 14.3, 14.4, and 14.5 above, and subject to the requirements of a lender,
loss payee as respect the property policies. Such evidence of insurance shall
give Landlord at least thirty (30) days prior notice of cancellation or any
material change to policies. Tenant shall also reasonably assist Landlord to
procure such other insurance coverages as may be required by a lender for the
Facility, provided any expenses incurred by Tenant in doing so will be
reimbursed by Landlord.
ARTICLE 15
CONDEMNATION
15.1 Definitions:
15.1.1 "Condemnation" means (1) the exercise of any governmental or
governmentally-derived power, whether by legal proceedings or otherwise, by a
Condemnor (as defined below), and (2) a voluntary sale or transfer by Landlord
to any Condemnor, either under threat of condemnation or while legal proceedings
for condemnation are pending.
15.1.2 "Date of Taking" means the date the Condemnor has the right to
possession of the property being condemned.
15.1.3 "Award" Incans all compensation, sums, or anything of value awarded,
paid, or received on a total or partial Condemnation.
15.1.4 "Condemnor" means any public or quasi-public authority, or private
entity or individual, having the power of Condemnation.
_ 15.2 If during the Term there is any taking of all or any part of the
Premises or
any interest in this Lease by Condemnation, the rights and obligations of the
parties shall
be determined pursuant to the provisions of this Article 15.
15.3 If the Premises are totally taken by Condemnation, this Lease shall
terminate on the Date of Taking.
15.4 If the Premises are partially taken by Condemnation, this Lease shall
remain in effect, except that Tenant can elect to terminate this Lease if the
remaining portion of the building or other improvements or the parking area that
are a part of the Premises is rendered unsuitable for Tenant's continued use of
the Premises. If Tenant elects to terminate this Lease, Tenant must exercise its
right to terminate by giving notice ("Termination Notice") to Landlord within
thirty (30) days after the nature and extent of the taking have been finally
determined. The Termination Notice shall state the date of termination, which
date shall not be earlier than thirty (30) days nor later than ninety (90) days
after Tenant has notified Landlord of its election to terminate (except that
this Lease shall terminate on the Date of Taking if the Date of Taking falls on
a date before the date of termination as designated by Tenant in the Termination
Notice). If Tenant does not terminate this Lease within the thirty (30) day
period specified above, this Lease shall continue in full force and effect,
except that Base Monthly Rent shall be reduced pursuant to Section 15.5. below.
15.5 If any portion of the Premises (other than that portion consisting of
land
upon which no buildings, improvements, parking areas, driveways, walkways or
recreation areas are located, hereinafter referred to as "Excluded Premises") is
taken by
Condemnation and this Lease remains in full force and effect, on the date of the
Award,
the Base Monthly Rent shall be reduced by an amount that is in the same ratio to
Base
Monthly Rent as the amount that the Award bears to the total value of the
Premises
immediately before the date of Award.
15.6 If there is a partial taking of the Premises and this Lease remains in
full force and effect, Landlord shall restore the Premises to the extent of the
proceeds available from the Award or, at its option, shall make the Award
available to Tenant for the Restoration thereof; provided, however, that if the
Award is not sufficient to pay for Restoration, Landlord may elect to furnish
the deficiency or Landlord may elect to terminate this Lease, at Landlord's
discretion, in which latter event, Tenant may elect to furnish the deficiency by
written notice to Landlord within ten (10) days following Landlord's notice to
Tenant of Landlord's election to terminate hereunder. Base Monthly Rent shall be
abated or reduced during the period from the Date of Taking until the completion
of Restoration, but all other obligations of Tenant under this Lease shall
remain in full force and effect. The abatement or reduction of Base Monthly Rent
shall be based on the extent to which the Restoration interferes with Tenant's
use of the Premises; provided, however, that in the event the Premises cannot be
fully restored after such Taking, the Base Monthly Rent due hereunder shall be
permanently abated or reduced in accordance with the provisions of Section 15.5
hereof.
16
' 15.7. Notwithstanding anything to the contrary set forth in this Article
15, in the
event of any total or partial Condemnation of the Premises, Landlord shall have
the right,
on written notice to Tenant, to elect to terminate this Lease and relieve Tenant
from its
obligation to repair or restore the Premises as well as any and all other
obligations
imposed on Tenant hereunder, other than those obligations which specifically
survive
termination of the Lease.
15.8 If the Lease remains in full force and effect after a total or
partial Condemnation, the entire Award shall belong to and be paid to Landlord.
If the Lease terminates or is terminated in accordance with this Article 15
after a total or partial Condemnation, the Award shall belong to and be paid to
Landlord, except that Tenant shall receive from the Award any sum separately
awarded for relocation, plus any sum separately awarded to compensate Tenant for
the value of any of Tenant's personal property taken by the Condemnor.
ARTICLE 16
DESTRUCTION
16.1 If during the Term the Premises or any part thereof are totally or
partially destroyed from a risk required to be. covered by the insurance
described in Article 14 of this Lease, Tenant shall restore the Premises to
substantially the same condition as they were in immediately before destruction,
whether or not the insurance proceeds are sufficient to cover the actual cost of
Restoration. Such destruction shall not terminate this Lease. If the existing
laws do not permit the Restoration, either party can terminate this Lease
immediately by giving notice to the other party in which case all proceeds of
insurance payable by reason of such destruction shall belong to Landlord, other
than any proceeds specifically allocated to Tenant's personal property.
16.2 If during the Term the Premises or any part thereof are totally or
partially destroyed from a risk not required to be covered by the insurance
described in Article 14 of this Lease, Tenant shall restore the Premises to
substantially the same condition as they were in immediately before destruction.
Such destruction shall not terminate this Lease. If the existing laws do not
permit the Restoration, either party can terminate this Lease immediately by
giving notice to the other party in which case, if the risk is covered by the
insurance described in Article 14 of this Lease, all proceeds of insurance
payable by reason of such destruction shall belong to Landlord, other than any
proceeds specifically allocated to Tenant's personal property.
16.3 If during the Term any portion of the Premises are damaged or
destroyed from a risk covered by the insurance described in Article 14 of this
Lease, and the total amount of loss does not exceed ten thousand dollars
($10,000), Tenant shall make the loss adjustment with the insurance company
insuring the loss. The proceeds shall be paid directly to Tenant for the sole
purpose of making the Restoration of the Premises in accordance with Sections
16.8 et seq. of this Lease.
16.4 If during the Term any portion of the Premises are damaged or
destroyed from a risk covered by the insurance described in Article 14 of this
Lease, and the total amount of loss exceeds ten thousand dollars (,S 10,000),
Tenant shall, with Landlord's approval, make the loss adjustment with the
insurance company insuring the loss, and on receipt of the proceeds, the parties
shall immediately pay them to a bank, savings and loan association, or other
person or company furnishing construction disbursement control services
acceptable to Landlord ("Insurance Trustee") to act as insurance trustee
hereunder.
16.5 All sums ("Trust Funds") deposited with the Insurance Trustee
(including insurance proceeds) shall be held for the following purposes and the
Insurance Trustee shall have the following powers and duties:
16.5.1 The Trust Funds shall be paid in installments by the Insurance
Trustee to the contractor retained by the Tenant as construction progresses, for
payment of the cost of Restoration. A 10% retention fund shall be established
that will be paid to the contractor on the last to occur of (i) completion of
Restoration, (ii) payment of all costs thereof, (iii) receipt of all necessary
governmental inspection approvals, (iv) expiration of all applicable lien
periods, and (v) proof that the Premises are free of all mechanics' liens and
lienable claims.
16.5.2 Payments shall be made on presentation of certificates or vouchers
from the architect, engineer, or other inspection agency retained by the
Insurance Trustee or Tenant showing the amount due. If the Insurance Trustee, or
Landlord, in its reasonable discretion, determines that the certificates or
vouchers are being improperly approved. either shall have the right to appoint
an architect, engineer, or inspection agency to supervise construction and to
make payments only on certificates or vouchers approved by such person. The
expenses and charges of the person retained by Landlord or the Insurance Trustee
shall be paid out of the Trust funds.
16.5.3 If after deposit by the parties of all sums required by this Article
16, the sums held by the Insurance Trustee are not sufficient to pay the actual
cost of Restoration., Tenant and/or Landlord (as applicable) shall deposit the
amount of the deficiency with the Insurance Trustee within seven (7) days after
request by the Insurance Trustee indicating the amount of the deficiency.
16.5.4 Insurance proceeds not disbursed by the Insurance Trustee after
Restoration has been completed and final payment has been made to Tenant's
contractor shall be delivered within seven (7) days (after demand made by either
party on the Insurance Trustee, with a copy to Landlord's Lender) by the
Insurance Trustee to Landlord's Lender and shall be applied by Landlord's Lender
to reduce the balance of the loan held by the Lender.
. 16.5.5 Any undisbursed funds remaining after compliance with the
provisions of this Article 16 shall be delivered to Landlord. All actual costs
and charges of the Insurance Trustee shall be paid by Tenant.
16.5.6 If the Insurance Trustee resigns or for any reason is unwilling to
act or continue to act, the parties shall jointly substitute a new trustee
meeting the requirements of Section 16.5. above in the place of the designated
Insurance Trustee.
16.6 Landlord shall not be required to provide any funds to cover the cost
of restoring the Premises.
16.7 Promptly following the date that Tenant is obligated to restore the
Premises in accordance with this Section 16, Tenant at its cost shall prepare or
cause to be prepared by a licensed architect and engineer final plans and
specifications and working drawings (collectively "Plans") complying with
applicable laws that will be necessary for Restoration of the Premises. The
Plans shall be subject to approval by Landlord. Landlord shall have twenty (20)
days after receipt of THE PLANS TO EITHER approve or disapprove the Plans and
return them to Tenant. If Landlord disapproves the Plans, Landlord shall notify
Tenant of its objections, and Tenant shall submit revised Plans responding to
Landlord's objections. The process shall continue until Landlord has approved
the Plans. Any unresolved controversy arising out of our relating to this
Section 16.8 shall be settled by arbitration in accordance with the
then-prevailing rules of the American Arbitration Association, and judgment upon
the award may be entered in any Court having jurisdiction thereof. Tenant
acknowledges that the Plans shall be subject to approval of the appropriate
government bodies and that they will be prepared in such a manner as to obtain
that approval.
16.8 The Restoration shall be accomplished as follows:
16.8.1 Tenant shall complete the Restoration as promptly as possible after
final Plans have been approved by Landlord and all appropriate government bodies
and all required permits have been obtained (subject to a reasonable extension
for delays resulting from causes beyond Tenant's reasonable control).
16.8.2 Tenant shall retain a licensed general contractor that is bondable.
The contractor shall be required to carry public liability and workers'
compensation insurance, and such other coverages as may be reasonably required
by Landlord or its Lender, during the period of construction. Landlord,
Landlord's Lender if required, and Tenant shall be named as additional insureds
on the contractor's general liability insurance policy. Such insurance shall
contain a waiver of subrogation clause in favor of Landlord, Landlord's Lender
if required, and Tenant. The contract for Restoration between Tenant and its
contractor shall be approved by Landlord, in advance, which approval shall not
be unreasonably withheld. During Restoration, Tenant, at its sole cost and
expense, shall take out a course of construction policy that includes Landlord
(and Landlord's Lender, if required) as an insured. Such policy shall provide
for "special form"
peril's coverage, but shall exclude earthquake, in an amount sufficient to
protect an estimated amount to complete the Restoration, including transit and
installation coverage.
Rent or any other sums required to be paid under this Lease when due no such
notice and opportunity to cure shall be provided to Tenant.
18.1.2 Abandonment, except for emergencies, of the Facility (failure to
maintain legally-required staff for the operation of the Facility for eight (8)
consecutive hours shall be an abandonment). Vacation of the Facility due TO ACTS
OF GOD, NATURAL catastrophes, war, riot or other similar events beyond Tenant's
control shall not be deemed an abandonment.
18.1.3 Tenant fails to pay its debts as they become due, or admits in
writing its inability to pay its debts, or makes a general assignment for the
benefit of creditors.
18.1.4 Commencement by Tenant of any case, proceeding or other action
seeking reorganization, arrangement, adjustment, liquidation, dissolution or
composition
of it or its debts under any law relating to bankruptcy, insolvency,
reorganization or relief
of debtors, or seeking appointment of a receiver, trustee, custodian or other
similar
official for it or for all or any substantial part of its property.
18.1.5 Tenant taking any corporate action to authorize any of the actions
set forth above.
' 18.1.6 Commencement of any case, proceeding or other action against Tenant
seeking to have an order for relief entered against it as debtor, or seeking
reorganization, arrangement, adjustment, liquidation, dissolution or composition
of it or its debts under any law relating to bankruptcy, insolvency,
reorganization or relief of debtors, or seeking appointment of a receiver,
trustee, custodian or other similar official for it or for all or any
substantial part of its property, and such case, proceeding or other action (i)
results in the entry of an order for relief against it which is not fully stayed
within seven (7) business days after entry thereof or (ii) remains undismissed
for a period of thirty (30) days.
18.1.7 Notwithstanding any other provisions of this Lease, the failure of
Tenant to comply with any of the provisions of the Lease or any other act or
omission by Tenant (whether occurring at the Facility or elsewhere) which, in
the reasonable and good faith judgment of Landlord, places in imminent jeopardy
the continued licensing of the Facility as then currently licensed and if,
within twenty-four (24) hours after written notice thereof from Landlord to
Tenant, Tenant shall not have either (i) cured such failure; or (ii) obtained an
injunction or other order preventing revocation or suspension of licensing of
the Facility by virtue of such failure or alleged failure, or (iii) provided
Landlord with assurances satisfactory to Landlord that the Facility will not be
subject to license suspension or revocation as a result of such failure or
alleged failure.
18.1.8 Notwithstanding any other provisions of this Lease, a release,
generation or disposal of Hazardous Substances from the Premises or onto the
Premises, except in accordance with law.
18.1.9 Failure by Tenant to observe or perform any other covenants,
conditions, or provisions of this Lease to be observed or performed by Tenant
where such failure shall continue for a period of thirty (30) days after written
notice (unless a shorter cure period is specifically provided for in this Lease
with respect to such covenant, condition or provision) thereof from Landlord to
Tenant. If the nature of TENANT'S DEFAULT IS SUCH that more than thirty (30)
days are reasonably required for its cure (it being understood and agreed that
any default which can be cured with the payment of money can reasonably be cured
within thirty (30) days), Tenant shall not be deemed to be in default if Tenant
commences such cure within said thirty (30) day period and thereafter diligently
prosecutes such cure to completion within the subsequent thirty (30) day period,
it being understood and agreed that Tenant shall not have more than sixty (60)
days to cure any such default.
18.2 Landlord shall have the following remedies without further notice to
Tenant if Tenant commits a default. These remedies are not exclusive and are in
addition to any other remedies provided hereunder or allowed at law or equity:
18.2.1 Landlord may reenter and resume possession of the Facility, and
remove Tenant and Tenant's personal property therefrom, and declare all of the
Base Monthly Rent due for the remaining Term of the Lease to be immediately due
and payable and at its option either terminate this Lease or, without
terminating it, lease the Facility for the account of Tenant for the remainder
of the Term, or for such term or terms as Landlord shall see fit and recover
from Tenant all damages incurred by reason of such Event of Default, including
the cost of repairs and alterations required as a result of Tenant's default,
future unmitigated lost rents, the cost of recovering the Premises and
Landlord's reasonable attorneys fees. Should default be made by Tenant, as
aforesaid, Landlord may, on the other hand, should it so desire, without
reentering or resuming possession of the Facility and without terminating this
Lease, enforce, by all proper and legal suits and other means, its rights
hereunder, including the collection of Rent. Should it be necessary for Landlord
to take any legal action hereunder, Tenant shall pay to Landlord all reasonable
attorneys' fees and all other costs and expenses incurred by Landlord in
connection with such action. Landlord may, in its sole and absolute discretion,
elect to have a receiver appointed to effect any of the remedies set forth in
this Section 18.2. If a receiver is appointed, Tenant shall pay, without
limitation, all the associated direct and indirect costs of such appointment and
such receiver
18.2.2 If Landlord elects to relet the Facility as provided in this Section
18.2, Rent that Landlord receives from reletting shall be applied to the payment
of: First, any indebtedness from Tenant to Landlord other than Rent due from
Tenant; second, all costs, including for maintenance, incurred by Landlord in
reletting; and third, Rent due and unpaid under this Lease. After deducting the
payments referred to in this paragraph, any suns remaining from the Rent
Landlord receives from reletting shall be held by Landlord and applied in
payment of future Rent as Rent becomes due under this Lease. In no event shall
Tenant be entitled to any excess Rent received by Landlord.
16.8.3 Tenant shall notify Landlord of the scheduled date of commencement
of the Restoration at least ten (10) days before commencement of the
Restoration. The contractor retained by Tenant shall not commence construction
until a performance bond and a labor and material payment bond in the full
amount of the cost of Restoration have been delivered to Landlord and Landlord's
Lender, if required, to insure completion of the construction.
16.8:4 Tenant shall accomplish the Restoration in a manner that will cause
the least inconvenience, annoyance, and disruption to the Premises.
16.8.5 Prior to commencement of construction of the Restoration and upon
completion of the Restoration, Tenant shall immediately furnish Landlord
evidence satisfactory to Landlord that the Restoration complies with all
applicable statutes, ordinances, codes and law and that all necessary and
applicable permits and approvals have been obtained for the Restoration.
16.8.6 The Restoration shall not be commenced until sums sufficient to
cover the cost of Restoration are placed with the Insurance Trustee.
16.9 In case of damage or destruction to the Premises or any part thereof,
there shall be no abatement or reduction of Rent.
16.10 The provisions of this Article 16 assume that the insurance proceeds,
in the event of an insurable loss, are made available to the parties for the
purpose of Restoration of the Premises. In the event that Landlord's Lender(s)
refuse(s) to make the proceeds available for such purpose, having the right to
do so, and/or as a condition of malting the proceeds available alter(s) the
terms of any obligations secured by encumbrance(s) affecting the Premises so as
to materially change the cost of or the manner in which such obligation(s )
is/are to be paid or discharged, Landlord shall have the right to terminate this
Lease by giving notice to Tenant not later than thirty (30) days after
determination of such condition(s).
16.11 Notwithstanding anything to the contrary set forth in this Article
16, in the event of any damage to or destruction of the Premises, Landlord shall
have the right, on written notice to Tenant, to elect to terminate this Lease
and relieve Tenant from its obligation to repair or restore the Premises as well
as any and all other obligations imposed on Tenant hereunder, other than those
obligations which specifically survive. termination of the Lease. In the event
Landlord exercises its rights under this Section i6.1?. all o_ the insurance
proceeds payable as a result of such damage and destruction said be paid by
Tenant to Landlord concurrently with, or as a condition to, the termination of
this Lease, it being understood and agreed that the Lease shall not terminate
unless and until such proceeds have been paid to Landlord by Tenant.
SUCH PERSON, (II) ALL OF THE TERMS AND CONDITIONS OF SUCH OFFER, AND (III) THE
ADEQUATE ASSURANCE TO BE PROVIDED LANDLORD TO ASSURE SUCH PERSON'S FURTHER
PERFORMANCE UNDER THE LEASE, INCLUDING, WITHOUT LIMITATION, THE ASSURANCE
REFERRED TO IN SECTION 365(F)(3)(B) OF THE BANKRUPTCY CODE, SHALL BE GIVEN TO
LANDLORD BY TENANT NO LATER THAN TWENTY (20) DAYS AFTER RECEIPT BY TENANT, BUT
IN ANY EVENT NO LATER THAN TEN (10) DAYS PRIOR TO THE DATE THAT TENANT SHALL
MAKE APPLICATION TO A COURT OF COMPETENT JURISDICTION FOR AUTHORITY AND APPROVAL
TO ENTER INTO SUCH ASSIGNMENT AND ASSUMPTION, AND LANDLORD SHALL THEREUPON HAVE
THE PRIOR RIGHT AND OPTION, TO BE EXERCISED BY NOTICE TO TENANT GIVEN AT ANY
TIME PRIOR TO THE LEASE TERMINATION DATE OF SUCH PROPOSED ASSIGNMENT, TO ACCEPT
AN ASSIGNMENT OF THIS LEASE UPON THE SAME TERMS AND CONDITIONS AND FOR THE SAME
CONSIDERATION, IF ANY, AS THE BONA FIDE OFFER MADE BY SUCH PERSON, LESS ANY
BROKERAGE COMMISSIONS WHICH MAY BE PAYABLE OUT OF THE CONSIDERATION TO BE PAID
BY SUCH PERSON FOR THE ASSIGNMENT OF THIS LEASE.
17.10.3 ANY PERSON OR ENTITY TO WHICH THIS LEASE IS ASSIGNED PURSUANT
TO THE PROVISIONS OF THE BANKRUPTCY CODE SHALL BE DEEMED WITHOUT FURTHER ACT OR
DEED TO HAVE ASSUMED ALL OF THE OBLIGATIONS ARISING UNDER THIS LEASE ON AND
AFTER THE DATE OF SUCH ASSIGNMENT. ANY SUCH ASSIGNEE SHALL UPON DEMAND EXECUTE
AND DELIVER TO LANDLORD AN INSTRUMENT CONFIRMING SUCH ASSUMPTION.
17.11 TENANT IMMEDIATELY AND IRREVOCABLY ASSIGNS TO LANDLORD, AS SECURITY
FOR TENANT'S OBLIGATIONS UNDER THIS LEASE, ALL PAYMENTS OF RENT FROM ANY
SUBLETTING OF ALL OR PART OF THE PREMISES AS PERMITTED BY THIS LEASE. LANDLORD,
AS SUCCESSOR AND AS ATTORNEY-IN-FACT FOR TENANT, OR A RECEIVER FOR TENANT
APPOINTED ON LANDLORD'S APPLICATION, MAY COLLECT SUCH RENT AND APPLY IT TOWARD
TENANT'S OBLIGATIONS UNDER THIS LEASE. HOWEVER, UNTIL THE OCCURRENCE OF AN ACT
OF DEFAULT OF TENANT, TENANT SHALL HAVE THE RIGHT TO COLLECT SUCH RENT. NOTHING
HEREIN IS INTENDED TO ABROGATE OR AFFECT THE PROVISIONS OF SECTION 17.8.
17.12 FOLLOWING THE CONSENT TO AN ASSIGNMENT, ENCUMBRANCE, TRANSFER OR
SUBLEASE, LANDLORD MAY, BUT SHALL NOT BE OBLIGATED TO, CONSENT TO SUBSEQUENT
ASSIGNMENTS, ENCUMBRANCES, TRANSFERS OR SUBLEASES OF THE SUBLEASE OR ANY
AMENDMENTS OR MODIFICATIONS THERETO WITHOUT NOTIFYING TENANT, OR ANY OTHER
PERSONS LIABLE ON THE LEASE OR ANY SUBLEASE AND WITHOUT OBTAINING THEIR CONSENT,
AND SUCH ACTION SHALL NOT RELIEVE SUCH PERSONS FROM LIABILITY UNDER THIS LEASE
OR ANY SUBLEASE.
ARTICLE 18
DEFAULTS; REMEDIES
18.1 The OCCURRENCE OF ANY ONE or more of the FOLLOWING EVENTS SHALL
CONSTITUTE A DEFAULT AND BREACH OF THIS LEASE BY TENANT:
18.1.1 FAILURE TO PAY RENT or any other sums required to be paid under this
Lease when any such failure continues for more than seven (7) DAYS AFTER WRITTEN
NOTICE of such failure is delivered by Landlord to Tenant; provided, however,
that from and after the failure of Tenant on more than two occasions in any one
Lease Year to pay
17.5 [intentionally left blank]
17.6 The consent by Landlord to any assignment or sublease shall not
release Tenant from its and their obligations under this Lease or ALTER THE
PRIMARY LIABILITY OF Tenant to pay the Rent and perform and comply with all of
the obligations of Tenant to be performed under this Lease.
17.7 If Tenant requests Landlord to consent to a proposed assignment or
sublease, Tenant shall pay to Landlord (whether or not consent is ultimately
given) a reasonable sum not exceeding one-half of one month's then-current Base
Monthly Rent on account of Landlord's costs, expenses and attorneys' fees in
connection with such request.
17.8 No interest of Tenant in this Lease shall be assignable by
involuntarily or by operation of law. Each of the following acts shall be
considered an involuntary assignment:
17.8.1 If Tenant is or becomes bankrupt or insolvent, makes an assignment
for the benefit of creditors, or institutes a proceeding under the Bankruptcy
Code in which Tenant is the debtor:
s
17.8.2 If a writ of attachment or execution is levied on this Lease;
17.8.3 If, in any proceeding or action to which Tenant is a party, a
receiver is appointed with authority to take possession of the Premises.
17.9 An involuntary assignment shall constitute a default by Tenant
under this Lease and Landlord shall have the right to elect to terminate this
Lease, in which case this Lease shall not be treated as an asset of Tenant. If a
writ of attachment or execution is levied on this Lease, Tenant shall have
thirty (30) days in which to cause the attachment or execution to be removed.
17.10 Bankruptcy:
17.10.1 If this Lease is assigned to any person or entity pursuant to
the provisions of the Bankruptcy Code, I1 U.S.C. Section 101 et seq. (the
"Bankruptcy Code"); any and all monies or other consideration payable or
otherwise to be delivered in connection with such assignment snail be paid or
d-livered to Landlord, shall be and remain the exclusive property of Landlord
and shall not constitute property of Tenant or of the estate of Tenant within
the meaning of the Bankruptcy Code.
17.10.2 If Tenant assumes this Lease and proposes to assign the same
pursuant to the provisions of the Bankruptcy Code to any person or entity who
shall have made a bona fide offer to accept an assignment of this Lease on terms
acceptable to Tenant, then notice of such proposed assignment setting forth (i)
the name and address of
ARTICLE 17
ASSIGNMENT AND SUBLETTING
17.1 Tenant shall not voluntarily assign or otherwise transfer or encumber
its interest in this Lease or in the Premises, including but not limited to,
ENTERING INTO A management agreement or contract with anyone to operate the
Facility (collectively an "assignment"), or sublease all or any part of the
Premises or allow any other person or entity (except Tenant's agents, invitees
and patients) to occupy or use all of any part of the Premises (collectively a
"sublease")Any such assignment, encumbrance, transfer or sublease without
Landlord's written consent shall be voidable and, at Landlord's election, shall
constitute a default under this Lease. No consent to any such assignment,
encumbrance transfer or sublease shall constitute consent to any future
assignment, encumbrance, transfer or sublease or a further waiver of the
PROVISIONS OF THIS ARTICLE 17. If Tenant is a partnership or limited liability
company, a withdrawal or change, voluntary, involuntary, or by operation of law,
of a partner or partners or member or members owning 50% or more of the
partnership or limited liability company, or the dissolution of the partnership
or limited liability company, shall be deemed a voluntary assignment or
transfer. If Tenant consists of more than one person, a purported assignment,
voluntary, involuntary, or by operation of law, from a majority of such persons
to the others shall be deemed a voluntary assignment or transfer. If Tenant is a
corporation or limited liability company. any dissolution, merger,
consolidation, or other reorganization of Tenant, as applicable, or the sale or
other transfer of a controlling percentage of the capital stock or other equity
interests of Tenant, or the sale of 50 io of the value of the assets of Tenant,
shall be deemed a voluntary assignment or transfer. The phrase "controlling
percentage" means the ownership of; and the right to vote, stock possessing at
least 51% of the total combined voting power of all classes of Tenant's capital
stock or other equity interests issued; outstanding, and entitled to vote for
the election of directors or managing members.
17.2 Notwithstanding anything to the contrary contained herein, Landlord's
acceptance of rent from any person or entity other than Tenant shall not be
deemed, in and of itself, to be a waiver of any of the provisions of this Lease
or a consent to an assignment or subletting.
17.3 No sublease entered into by Tenant shall be effective unless and
until it has been approved in writing by Landlord. In entering into any
sublease, Tenant shall use only such form of sublease as is satisfactory to
Landlord, and once approved by Landlord, such sublease shall not be changed or
modified without Landlord's prior written consent.
17.4 Any assignee or sublessee shall, by reason of entering into an
assignment or sublease under this Lease shall be deemed, for the benefit of
Landlord, to have assumed and agreed to conform and comply with each and every
obligation under tills Lease to be performed by Tenant other than such
obligations as are contrary to or inconsistent with provisions contained in an
assignment or sublease to which Landlord has expressly consented in writing.
18.2.3 In the event of a default under Section 18.1.8 above, Landlord may,
in addition to all other remedies which it may pursue, elect to shut down
Tenant's operations and require cleanup of the contamination at Tenant's expense
while still enforcing the remaining terms of this Lease. In such event, Landlord
shall have no liability to Tenant for any damages arising out of the shutdown of
operation. If Landlord elects to terminate the Lease on account of such default,
Landlord shall be entitled to collect as an item of its damages the cost of the
cleanup of the contamination.
18.2.4 Landlord, at any time after Tenant commits a default, can cure the
default at Tenant's cost. If Landlord at any time, by reason of Tenant's
default, pays any sum or does any act that requires the payment of any sum, the
sum paid by Landlord shall be due immediately from Tenant to Landlord at the
time the sum is paid, and if repaid at a later date, shall bear interest at the
maximum rate permitted by law, or if no maximum rate applies, then 18% per
annum, from the date the sum is paid by Landlord until Landlord is reimbursed by
Tenant.
18.2.5 Should Landlord require Tenant to deliver possession of the Facility
to Landlord or to another assisted living facility operator following a breach
of the Lease by Tenant, Tenant agrees to fully cooperate with Landlord and/or
such Landlord in effecting a transition in the operation of the Facility that
will least disrupt the continuing operation and the comfort and welfare of the
patients. Such cooperation shall include, to the extent deemed necessary by
Landlord and permitted under applicable law, permission by Tenant for such
Landlord (i) to operate for its own account under Tenant's license pursuant to a
management agreement until a new license is obtained.
18.3 If Landlord is in default of this Lease, and as a consequence
Tenant, recovers a money judgment against Landlord, the judgment shall be
satisfied only out of (i) the proceeds of sale received by voluntary sale of, or
on execution of the judgment against, the right, title and interest of Landlord
in the Facility or (ii) Rent or other income from the Facility receivable by
Landlord. Neither Landlord nor any of the partners or members comprising any
partnership designated as Landlord nor any of the members of any limited
liability company designated as Landlord (including, in the case of a corporate
partner or member, the shareholders, directors and officers thereof) shall be
personally liable for any deficiency.
ARTICLE 19
SIGNS
Subject to Landlord's prior written approval, Tenant at its cost shall have
the right to place, construct, and maintain on the Premises one or more signs
advertising its business at the Premises. Any sign that Tenant has the right to
place, construct, and maintain shall comply with all laws, ordinances,
regulations and covenants, conditions and restrictions affecting the Premises,
and Tenant shall obtain any approval required thereby. Landlord makes no
representation with respect to Tenant's ability to obtain such approval. Upon
the expiration or sooner termination of this Lease, Tenant shall; at the option
of Landlord, either remove any signs erected by Tenant and repair the Premises
to the same condition it was in prior to the installation or construction of the
sign(s), or leave such signs in place for Landlord's benefit. Upon expiration or
termination of this Lease, Tenant hereby consents to the use by Landlord, at
Landlord's election, of the name of the Facility and Tenant hereby presently
assigns to Landlord the right, title and interest of Tenant in the name of the
Facility; provided that as long as Tenant is not in default hereunder and/or
until the expiration or termination of this Lease, Landlord consents to Tenant's
use of said name and signs for the benefit of the Facility. Said name shall not
be changed without Landlord's prior written consent.
ARTICLE 20
RIGHT OF ENTRY R
20.1 Landlord and its authorized representatives shall have the right
to enter the Premises at any time in order to:
20.1.1 Determine whether the Facility is in good condition and whether
Tenant is complying with its obligations under this Lease;
20.1.2 Do any necessary maintenance and to make any Restoration to the
Premises that Landlord has the right or may have the obligation to perform;
provided, that nothing herein contained shall constitute an obligation on the
part of Landlord or its designated representative to maintain or restore the
Premises or any part thereof;
20.1.3 Serve, post, or keep posted any notices required or allowed under
the provisions of this Lease or applicable law;
20.1.4 Post "for rent" or "for lease" signs during the last six (6) months
of the Term, or during any period while Tenant is in default; and
20.1.5 Show the Premises to prospective brokers, agents, buyers, tenants,
lender, or persons interested in an exchange, at any time during the Term.
20.2 Landlord shall not be liable in any manner for any inconvenience,
disturbance, loss of business, nuisance, or other damage arising out of
Landlord's entry
on the Premises as provided in this Article 20, except damage resulting from the
gross negligence or intentional acts or omissions of Landlord or its authorized
representatives.
20.3 Tenant shall not be entitled to an abatement or reduction of Rent
or any part thereof if Landlord exercises any rights reserved in this Article
20. Landlord shall conduct its activities on the Premises as allowed in this
Article 20 in a manner that will cause as little inconvenience, annoyance, or
disturbance to Tenant as reasonably practicable.
ARTICLE 21
SUBORDINATION; COMPLIANCE WITH ENCUMBRANCES;
ESTOPPEL; CERTIFICATION
21.1 This Lease is and shall be subordinate to any Encumbrance now or
hereafter recorded affecting all or any part of the Premises including all
advances made or to be made thereunder, and all renewals, replacements,
consolidations and extensions thereof. Such subordination is effective without
any further act of Tenant. Tenant shall from time to time, on request of
Landlord, execute and deliver any documents or instruments that may be required
by a Lender to effectuate any subordination. If Tenant fails to execute and
deliver any such documents or instruments, Tenant irrevocably constitutes and
appoints Landlord as Tenant's special attorney-in-fact to execute and deliver
any such documents or instruments.
21.2 Notwithstanding the above, if a Lender requires that Tenant execute an
agreement confirming that this Lease is subordinate to any such Encumbrance,
Tenant shall execute the same on the condition that Landlord obtains from the
Lender a written agreement providing, substantially, that as long as Tenant
performs its obligations under this Lease, no foreclosure of, deed given in lieu
of foreclosure of, or sale under the Encumbrance shall affect Tenant's rights
under this Lease. Landlord shall further use its best efforts to secure the
consent of such Lender to include in such agreement language to the effect that
the provisions of this Lease concerning disposition of insurance proceeds on
damage or destruction of Premises, and disposition of condemnation awards, shall
prevail over any conflicting provisions in the Encumbrance.
21.3 Tenant shall attorn to any purchaser at any foreclosure sale, or to
any grantee or transferee designated in any deed given in lieu of foreclosure.
Tenant shall execute upon demand any and all documents required by Lender(s) to
accomplish the purpose of this Article 21.
21.4 Tenant, within ten (10) days after notice from Landlord, shall execute
and deliver to Landlord a certificate in recordable form stating that this Lease
is unmodified and in full force and effect, or in full force and effect as
modified, and stating the modifications. The certificate also shall state the
amount of Base Monthly Rent then applicable, the dates to which the Base Monthly
Rent has been paid in advance, and the amount of any security deposit or prepaid
Rent and whether or not there is then outstanding any default or Events of
Default hereunder and, if so, specifying the nature thereof. The failure of
Tenant to deliver the certificate within the ten (10) day period provided for
herein shall be conclusive upon Tenant that this Lease is in full force and
effect and has not been modified, that no Base Monthly Rent other than for the
current month has been paid in advance, that the security deposit is in the
amount set forth in the Lease and that there is not other prepaid Rent, all
except as may be represented otherwise by Landlord in the certificate. If Tenant
fails to deliver the certificate within the ten (10) day period provided for
herein, Tenant irrevocably constitutes and appoints Landlord as its special
attorney-in-fact to execute and deliver the certificate to any third party.
1.5 Notwithstanding any other provisions of this Lease contained to the
contrary; with respect to any Encumbrance secured by the Premises and the
obligations of Landlord thereunder and provided Landlord has notified Tenant in
writing with respect to the existence and substance thereof. Tenant shall at all
times and in all respects fully, timely and faithfully comply with and observe
each and all of the conditions, covenants and provisions required on the part of
the LANDLORD AND OF WHICH TENANT HAS received notice under any such Encumbrance
(including any renewals, modifications, extensions, replacements and/or
consolidations thereof of which Tenant has received notice) to which this Lease
is subordinate or to which it later may become subordinate, including without
limitation, such conditions, covenants and provisions thereof as relate to the
care, maintenance, repair, insurance, restoration, preservation and condemnation
of the Premises. In addition, Tenant agrees that Tenant shall not do or permit
to be done. , anything which would constitute a breach or a default under any
obligation of Landlord under any such Encumbrance, it being the intention hereof
that Tenant shall so comply with and observe each and all of such covenants,
conditions and provisions of any such Encumbrance so that it will at all times
be in good standing and there will not be any, default on the part of the
Landlord thereunder. However, nothing contained in this - section shall be
construed to require Tenant to pay any part of the principal or interest due
under any such Encumbrance or to change the use of the Facility from that
described in Article 8 hereof.
ARTICLE 22
WAR
22.1 No delay or omission in the exercise of any right or remedy of
Landlord upon any default by Tenant shall impair such right or remedy or be
construed as a waiver.
22.2 The receipt and acceptance by Landlord of delinquent Rent or any
other amounts due hereunder shall not constitute a waiver of such default or any
other default or a waiver to demand timely performance in the future.
22.3 No act or conduct of Landlord including, without limitation, the
acceptance of the keys to the Premises, shall constitute an acceptance of the
surrender of the Premises by Tenant before the expiration of the Term. Only a
written notice from Landlord to Tenant shall constitute acceptance of the
surrender of the Premises and accomplish a termination of the Lease.
22.4 Either party's consent to or approval of any act by the other
requiring such party's consent or approval shall not be deemed to waive or
render unnecessary such party's consent to or approval of any subsequent act by
the other.
22.5 Any waiver by Landlord or Tenant of any default must be in writing and
shall not be a waiver of any other default concerning the same or any other
provision of the Lease.
22.6 In the event Tenant defaults under any provisions of this Lease and
Landlord elects to reenter and resume possession of the Premises and remove
Tenant therefrom, Tenant hereby waives the notice to vacate prior to filing an
eviction suit.
ARTICLE 23
SALE OR TRANSFER OF PREMISES
If Landlord sells or transfers the Facility or any interests therein, at
the option of Landlord to be exercised in its sole and absolute discretion, this
Lease shall terminate and whether or not this Lease terminates, Landlord, on
consummation of the sale or transfer, shall be released from any liability
thereafter accruing under this Lease.
ARTICLE 24
FINANCIAL STATEMENTS AND OPERATING INFORMATION
23.1 During the Term of this Lease, Tenant shall provide Landlord, or
cause to be provided to Landlord, a copy of Tenant's true and complete income
statement prepared in accordance with generally accepted accounting principles
and certified as true and correct by Tenant, reflecting operations at the
Premises for each month falling within the Term of this Lease and on a year to
date basis and a balance sheet as of the end of each month prepared in like
manner for the Premises, which statements shall be delivered to Landlord within
thirty (20) days following the expiration of each month. With each of the
foregoing income statements and balance sheets furnished, statements of cash
flow and occupancy reports for the same periods shall also be provided to
Landlord.
23.2 During the Term of this Lease, Tenant shall furnish to Landlord, or
cause to-be furnished to Landlord, promptly upon receipt by Tenant, copies of
all licenses, surveys and inspection reports relating to the Facility, together
with copies of all correspondence received by Tenant from any and all regulatory
authorities having cognizance or authority over operations at the Facility,
including but not limited to the Department of Social Services. Tenant shall
also furnish to Landlord, or cause to be furnished to Landlord, copies of all
plans of correction to be submitted to any such agency prior to such submission.
Tenant shall insure that Landlord is immediately notified each time a survey or
inspection of the Facility is commenced by any regulatory body or authority and
in the event, as a result of any such survey or inspection, Tenant is advised
that the applicable regulatory body or authority intends to take any action to
revoke, rescind or not renew the Facility's license.
ARTICLE 25 LICENSING
25.1 Tenant shall maintain at all time during the term hereof and any
extensions or holdover period all governmental licenses, permits and
authorizations necessary for the establishment and operation of the Licensed
Facility in the city, county and state in which the Facility is located, and
shall qualify and comply with all applicable laws as they may from lime to time
exist. Tenant shall not, without the prior written consent of Landlord (which it
agrees not to unreasonably withhold), effect any change in the license category
or status of the Facility or any part thereof or reduce the licensed capacity of
the Facility whether temporarily or permanently.
25.2 Nothing in this Lease shall be construed as granting Tenant any right,
title or interest in or to the beds/units which are located at the Facility or
granting Tenant any right to move the beds/units to another facility owned or
operated by Tenant, it being understood and agreed that Tenant's only right
hereunder is to operate the Facility during the Term hereof as the Licensed
operator in accordance with the terms hereof.
25.3 Landlord will not do anything so as to cause the licenses and
permits for the Facility to be invalidated. Tenant shall cause any special
staffing requirements imposed as a condition to maintaining any licenses or
other permits to be met.
ARTICLE 26
SURRENDER F PREMISES; HOLDING OVER
26.1 On the earlier to occur of the expiration of the Term hereof or
ten (10) days after sooner termination of the Term, Tenant shall surrender to
Landlord the Facility, including, without limitation, any and all patients,
patient records, and any and all documents of every kind whatsoever necessary to
enable Landlord to continue operation and including at least a fifteen (15) day
supply of necessary inventory and operational items, in good condition and
repair (except for ordinary wear and tear and insured casualty), and fit for use
by Landlord as the Licensed Facility and Tenant shall thereafter comply with the
operations transfer provision set forth in Exhibit C hereto.
26.2 If Tenant fails to surrender the Facility as required by- this
Article 26, Tenant shall hold Landlord harmless from all damages resulting from
Tenant's failure to surrender the Facility, including, without limitation,
claims made by a succeeding tenant resulting from Tenant's failure to surrender
the Facility.
26.3 If Tenant fails to surrender the Facility as required by this
Article 26, Tenant shall be deemed to be a tenant at sufferance on a month to
month basis and the Base Monthly Rent for such month-to-month tenancy shall be
One Hundred Thousand and no/100 Dollars (S100,000) plus an amount equal to any
damages suffered by Landlord as a result of Tenant's wrongful failure to
surrender the Facility it being understood and agreed that nothing in this
Article 26 shall be construed as giving Tenant any right to hold over after the
expiration or earlier termination of the Lease.
26.4 Tenant shall fully cooperate with Landlord in turning the Facility
over to Landlord so as to assure to Landlord and patients uninterrupted patient
care.
ARTICLE. 27
PRESERVATION OF PATIENT RECORDS
Tenant shall preserve all patient charts and records as required by
applicable law and deliver them to Landlord on expiration or sooner termination
of this Lease.
ARTICLE 28
PATIENT CARE; CENSUS
28.1 Tenant shall take all steps appropriate to maintain a high level
of quality patient care, and to promote and maintain a high patient census at
the Facility consistent with law and ethical standards governing the operation
of assisted living facilities. Except as otherwise permitted by law-, Tenant
shall not transfer patients from the Facility except for non payment of stay,
reasons of health, family request and/or convenience or request of the patient,
and shall not transfer patients to another facility or facilities owned or
operated directly or indirectly by Tenant, or in which Tenant has any interest,
except in cases where. an alternative facility is not available, or pursuant to
a request by the patient or family.
ARTICLE 29
MISCELLANEOUS
29.1 Time is of the essence of each provision of this Lease.
29.2 Each party represents that it has not had dealings with any real
estate broker, finder, or other person, with respect to this Lease in any
manner. Each party shall hold harmless the other party from all damages
resulting from any misrepresentations hereunder.
29.3 All exhibits referred to are attached to this Lease and
incorporated by reference.
29.4 All provisions, whether covenants or conditions on the part of
Tenant, shall be deemed to be both covenants and conditions.
29. 5 This Lease contains all the agreements of the parties with respect to
the subject matter hereof and cannot be amended or modified except by a written
agreement signed by Landlord and Tenant.
29.6 Any notice, demand, request, consent, approval or communication that
either party desires or is required to give to the other party or any other
person shall be in writing and either served personally or sent by registered or
certified United States mail, or by overnight courier or by facsimile
transmission. Any notice, demand, request, consent, approval or communication
that either party desires or is required to give to the other party shall be
addressed to the other party at the address appearing on the signature page of
this Lease. Either party may change its address by notifying the other party of
the change of address. Notice shall be deemed communicated within three (3)
business days from the time of deposit in the United States mail if mailed as
provided in this section, or upon delivery or refusal of delivery if delivered
personally or by overnight courier or by facsimile.
29.7 In the event of default hereunder by either party, and the other party
engages an attorney to prepare a notice or notices and/or to otherwise
communicate with the defaulting party, the defaulting party shall be liable to
the other party for its reasonable attorneys' fees incurred by it for such
services.
29.8 If any party brings an action or proceeding to enforce or
interpret the terms hereof or declare rights hereunder, the prevailing party (as
hereinafter defined) in any such proceeding, action, or appeal thereon, shall be
entitled to reasonable attorneys' fees. Such fees may be awarded in the same
suit or recovered in a separate suit, whether or not such action or proceeding
is pursued to decision or judgment. The term "prevailing party" shall include,
without limitation, a party who substantially obtains or defeats the relief
sought, as the case may be, whether by compromise, settlement, judgment, or the
abandonment by the other party of its claim or defense. The attorneys' fee award
shall not be computed in accordance with any court fee schedule, but shall be
such as to fully reimburse all attorneys' fees reasonably incurred. Landlord
shall be entitled to attorneys' fees, costs and expenses incurred in the
preparation and service of notices of default and consultations in connection
therewith, whether or not a legal action is subsequently commenced in connection
with such default or resulting breach. If either party or its authorized
representatives ("Passive Party") becomes a party to any litigation concerning
the Lease or the Facility, by reason of any act or omission of the other party
or its authorized representatives ("Active Party") and not by any act or
omission of the Passive Party or any act or omission of its authorized
representatives, the Active Party shall be liable to the Passive Party for
reasonable attorneys' fees and court costs incurred by the Passive Party in that
litigation.
29.9 This document shall, in all respects, be governed by the laws of the
state in which the Facility is located applicable to agreements executed and to
be wholly performed within such state. Nothing contained herein shall be
construed so as to require the commission of any act contrary to law, and
wherever there is any conflict between any provision contained herein and any
present or future statute, law, ordinance or regulation contrary to which the
parties have no legal right to contract, the latter shall prevail, but the
provision of this Lease which is affected shall be curtailed and limited only to
the extent necessary to bring it within the requirements of the law without
invalidating or affecting the remaining provisions of this Lease.
29.10 Each of the parties hereto shall execute and deliver any and all
additional papers, documents, and other assurances, and shall do any and all
acts and things reasonably necessary in connection with the performance of their
obligations hereunder and to carry out the intent of the parties hereto.
29.11 No amendment, change or modification of this document shall be valid
unless in writing and signed by all of the parties hereto.
29.12 All of the terms and provisions contained herein shall inure to the
benefit of and shall be binding upon the parties hereto and their permitted
successors and assigns.
29.13 This document may be executed in one or more separate counterparts,
each of which, when so executed, shall be deemed to be an original. Such
counterparts shall together constitute and be one and the same instrument.
29.14 The. captions appearing at the commencement of the articles hereof
are descriptive only and for convenience in reference. Should there be any
conflict between any such caption and the article, the article and not such
caption shall control and govern in the construction of this document.
29.1 5 As long as Tenant is not in default of any of the terms,
covenants and conditions of this Lease, Landlord covenants that Tenant, during-
the Term hereof; shall have the quiet use and enjoyment of the Facility.
29.16 The persons executing this Lease on behalf of Tenant represent
and warrant to Landlord that such persons are executing this Lease pursuant to a
resolution of Tenant's board of directors. Concurrently with Tenant's execution
of this Lease, Tenant shall deliver to Landlord a certified copy of a board of
directors' resolution confirming the foregoing authority.
29.17 Whenever under any provision of this Lease or any exhibit
thereto, Tenant shall be obligated to make any payment or expenditure, or to do
any act or thing, or to incur any liability whatsoever, and Tenant fails,
refuses or neglects to perform as herein provided, Landlord shall be entitled
but shall not be obligated to make such payment or expenditure, or do any such
act or thing, or to incur any such liability, all on behalf of and at the cost
and for the account of Tenant, together with interest at the maximum rate of
interest permitted by law, or if no maximum rate then applies, at the rate of
18% per annum.
29.18 This Lease is subject to the terms of the Working Capital
Agreement between Landlord and Tenant attached hereto as Exhibit D.
WILLOW CREEK ASSISTED LIVING
SIGNATURE PAGE FOR LEASE OF Folsom, CA DATED
February 21, 2002 between Sacramento County Assigned, LLC (Landlord) and the
RAL, Inc.(TENANT).
Landlord:
Landlord Address:
Sacramento County
Assisted LLC
0000 Xxxxx Xxx., #000
Xxxxxxx, XX 00000
With a copy to:
Xxxxx Xxxxxx LLP
Xxx Xxxxxxx Xxxxx
Xxxxxxxxxxxx, XX 00000-0000
Attn: Xxxxx X. Xxxx
Tenant: RAL, Inc.
dba RAL-Operations, Inc.
By: _
Tenant's Address: Name: Xxxxxx X.1GXsh )
000 XX Xxxxxxxx, #0000 Title: Treasurer
--
--
Xxxxxxxx, XX 00000
With a copy to: Xxxxx X. Xxxxxx, Esq.
Stoel Rives LLP
000 XX Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxx, XX 00000
SIGNATURE PAGE FOR LEASE OF DATED
BETWEEN,ar,~h . t.~ ('f~ `(LANDLORD) AND THE
(TENANT).s ,-~p ~~
Landlord:
Landlord Address:
With a copy to:
Tenant:
Tenant's Address:
With a copy to:
EXHIBIT INDEX:
Exhibit A - Description of Folsom, California Real Property
Exhibit B - Description of Personal Property
Exhibit C - Transfer of Operations Provisions
Exhibit D - WorkingCapital Agreement
-------
EXHIBIT A
DESCRIPTION OF FOLSOM, CALIFORNIA REAL PROPERTY
See Attached
CITY OF FOLSOM
PARCELS B AND C AS SHOWN ON THAT CERTAIN PARCEL MAP FILED IN THE OFFICE OF THE
COUNTY RECORDER OF SACRAMENTO COUNTY, CALIFORNIA ON MAY 26, 1992 IN BOOK 130 OF
PARCEL MAPS AT PAGE 21.
SAID PARCELS WERE MERGED INTO ONE PARCEL BY A CERTIFICATE OF COMPLIANCE RECORDED
FEBRUARY 18, 1997 IN DOCUMENT N0. 970218-1285, OFFICIAL RECORDS
ASSESSOR'S PARCEL NUMBER: 071-1160-010-0000
EXHIBIT B
DESCRIPTION OF PERSONAL PROPERTY
COLUMBIA PACIFIC MANAGEMENT
FOLSOM & SCOTTSDALE
PERSONAL PROPERTY LIST
WILLOW CREEK FOLSOM
Acquisition
Date Description Cost
FURNITURE & EQUIPMENT
------- ----
8/29/97 1 Host Carpet Dry Clean Machine 1,334.19
8/29/97 Aquacat 10 SCE Extractor 2,151.13
8/29/97 Xx Xxxxxxx Recept Bge (6) 655.04
8/29/97 Sanitare 7 Amp Vacuum 1,060.70
8/29/97 Sanitare Wide Track 16 (2) 565.68
10/28/97 2 JVC 27" TVs 879.94
10128/97 2 VCRs & 1 Telecorder 639.96
10/28/97 Stereo 1.239.76
11/1/97 Popcorn Machine & Cart 1,314.64
1/1/98 Paging System 8.446.01
4/1/98 1 Uninsulated Holding Cabinet 1,235.46
4/15/99 Floor and Carpet scrubber 1,128.43
10/1 /99 Coutnertop Fryer 581.20
8/1/00 Wander Guard 20,953.96
9/13/00 Wander Guard 896.40
11/1/00 Bench & Wall Hangings 2,415.94
11/1/00 Framed Artwork 4,954.95
11/1/00 Wander Guard 1,095.57
1/10/01 Wander Guard 1,106.50
5/2/01 Wandergard Wrist straps 725.48
7/27/01 Beauty Shop Chair & Dryer 734.21
10/31/97 1 Acrylic Table top 61.75
10131/97 1 Furniture Installation 3,606.00
10/31/97 1 Fabrics for Chairs 127.38
10/31/97 1 Lane Marbella Chair 882.00
10/31/97 1 Folsom Historical Photos 529.89
10/31/97 1 Frame & Mat Photos 1,270.10
10/31/97 1 Install Artwork/Mirrors 1,223.04
10/31/97 1 Accessories 1,825.04
10/31/97 1 Xxxxxxx Dining Table 200.50
10/31/97 8 Windsor 5 Ft Bench 2,414.72
10/31/97 8 Windsor Shorea Armchair 1,545.60
10/31/97 4 Windsor 24x24 Planters 893.76
10/31/97 4 Windsor 19x19 Planters 624.96
10/31/97 4 Chelsea 21" End Table 739.20
10/31/97 4 42" Round table w/ umbrella 874.00
10/31/97 16 Huntington Contract Dining Chair 2,096.00
10/31/97 4 Siena Octagon Market Umbrella 1,226.36
10/31/97 2 Huntington Double Glider 719.30
10/31/97 4 Round Steel Umbrella Base 360.88
10/31/97 1 Furniture Installation 11,984.00
10/31/97 1 Security Mount Brackets 276.00
10/31/97 1 Accessories 1,277.36
10/31/97 1 Fine Art Bowl w/metal stand 162.40
10/31/97 1 Vignale Furniture Fabric 98.00
10/31/97 1 Vanguard Framed Prints 9,391.98
10/31/97 1 Silk Peddler Trees and Plants 10,659.05
10/31/97 1 Wurlitzer Baby Grand Piano 6,540.80
10,`31/97 1 Twin Mattress sets, Bedding Etc. 341.87
10/31/97 1 Furniture Installation 1, 740.74
10/31/97 1 FlexsteelOttoman 161.78
10/31/97 2 Xxxxxxxx Lamp 378.56
10/31/97 2 Albany Soft Side Shade Lamp 311.36
10/31/97 1 Chickabee Table Lamp 133.28
10/31/97 45 Shower Chairs 2,475.00
10/31/97 0 Xxxxxxx Xxxx Xxx Table 508.48
10/31/97 1 Winston Writing Table 224.00
10/31/97 4 Xxxxxxx Xxxxxxxxxxx Desk Chair 609.28
10/31/97 1 Xxxx Del Mar Lamp 211.68
10/31/97 2 Winston Pedestal Activity Table 161.28
10/31/97 2 Winston Twin Size Headboard 302.40
10/31/97 2 Winston Nightstand 439.04
10/31/97 0 Xxxxxxx Xxxxx 369.60
10/31/97 2 Carolina Mirror 21 x 35 161.28
10/31/97 2 Winston TV Armoire 1,182.72
10/31 /97 2 Kaemark Kwikset Dryer w/ Hood 423.26
10/31/97 1 Kaemark Nail Station 550.23
10/31/97 1 Kaemark Magnifier Lamp 95.76
10/31/97 2 Xxxxx Xxxx Bench 303.00
10/31/97 1 Furniture Fabric 167.70
10/31/97 1 American Revival Home Electronics C 1,363.04
10/31/97 1 Cannister Table Lamp 218.40
10/31/97 2 Remington Jar table Lamp 257.60
10/31/97 7 Institutional Stacker Chairs w/ arms 597.10
10/31/97 1 Hydraulic Styling Chair 530.88
10/31/97 1 Xxxxxx Xxxxxxxxxx Chair 222.26
10/31/97 1 Furniture Fabric 45.68
10/31/97 8 Xxxxxxx Activity Chair 1,513.28
10/31/97 1 Furniture Fabric 302.40
10/31/97 2 Farmcraft Wood Top Table 1,422.40
10/31/97 i Furniture Fabric 433.23
10/31/97 1 Xxxxxxx Lounge Chair 301.19
10/31/97 1 Furniture Fabric 307.45
10/31/97 2 Xxxxxxx Lounge Chair 548.40
10/31/97 1 Furniture Fabric 169.65
10/31/97 1 Quoizel Table Lamp 182_.00
10/31/97 1 Xxxxxx Floor Lamp 361.20
10/31/97 1 Xxxxxxx Sofa w/ reversible cushions 526,84
10/31/97 '1 Furniture Fabric 475.15
10/31/97 1 Xxxxxxx Loveseat w/ reversible cushi 434.52
10/31/97 1 Furniture Fabric 322.56
10/31/97 1 Compatible Suranac End Table 486.08
10/31/97 1 Falcon Wood Arm Chair-upholstered 143.64
10/31/97 1 Furniture Fabric 40.32
10/31/97 1 Xxxxxx Table Lamp 226.80
10/31/97 1 Furniture Fabric 726.70
10/31/97 2 Flexsteel Lounge Chair 648.14
10/31/97 1 Furniture Fabric 1,383.20
10/31/97 1 Fabric Repellent 72.39
10;31/97 1 Skirted Straightback Loveseat 315.71
10/31/97 30 Institutional Stacker Chairs w/ arms 2,419.20
10/31/97 5 Fold-a-top Table 1,424.65
10/31/97 5 Falcon Table Base 775.60
10/31/97 2 Rectangular Folding Banquet Table 333.76
10/31/97 4 Xxxxxxx Wing Chair w/ reversible cu 1,289.12
10/31/97 2 Camden Cove Activity/Arm Chair 463.68
10/31/97 1 Furniture Fabric 151.20
10/31/97 1 Falcon Table Base 122.72
10/31/97 1 Falcon Table Top 349.94
10/31/97 4 Symmetry Arm Stack Chair 1,048.32
10/31/97 4 Xxxxx Ceramic Table Lamp 667.52
10/31/97 2 Camden Cove Activity Table 380.80
10/31/97 2 Camden Cove Activity/Arm Chair 463.68
10/31/97 2 Home Run open Bookcase 492.80
10/31/97 2 Thomasville Recliner 564.48
10/31/97 2 Motmot Wicker Table Lamp 322.56
10/31/97 1 Southland Entertainment Center 730.24
10/31/97 1 Furniture Fabric 151.20
10/31/97 2 Thomasville Recliner 564.48
10/31 /97 2 Camden Cove End Table 331.52
10/31/97 4 Eclipse Club Chair 1,814.40
10/31 /97 2 Marbella Chair 882.00
10/31/97 1 Furniture Fabric 127.38
10/31/97 2 Chippendale End Table 291.20
10/31/97 1 Furniture Fabric 224.96
10/31/97 1 Xxxxxxx Xxxxxx Table Lamp 144.48
10/31/97 1 Xxxxxxx Oval End Table 189.19
10/31/97 1 Fold-a-top Table 309.57
10/31 /97 1 Eclipse Settee 574.56
10,131/97 2 Marbella Round End Table 399.84
10/31/97 2 Acrylic Table Top 56.00
10/31/97 2 Melon Ceramic Table Lamp 132.16
10/31/97 1 Single TVNCR Center 412.16
10/31/97 2 Large Gooseneck Chair 557.94
10/31/97 7 42 x 42 Table Top 861.84
10/31/97 33 Ladder Back Arm Chair 5,673.36
10/31/97 1 Marbella Settee 746.76
10/31/97 1 Furniture Fabric 234_70
10/31/97 2 Marbella Chair 882.00
10/31/97 2 Xxxxx Xxxx Bench 321.16
10/31/97 1 Furniture Fabric 241.92
10/31/97 4 Xxxxxxx Sofa Table 936.36
10/31/97 5 Carolina Mirror 27 x 35 442.40
10/31/97 8 Falcon Table Base 788.48
10/31/97 2 American Revival Eastlake Bookcase
1,507.52
10/31/97 2 European Crossroads Lamp 560.00
10/31/97 2 European Crossroads Lamp 178.08
10/31/97 3 American Revival Wood Top Lamp Ta
1,065.12
10/31/97 2 Xxxxxxx Wing Chair w/ reversible cus
493.52
10/31/97 1 Xxxxxx Exam Stool 391.16
10/31/97 1 Midmark Exam Light 282.24
10/31/97 3 Symmetry Arm Stack Chair 840.69
- 10/31/97 3 Reveal Double Pedestal Desk 1,486.32
10/31/97 1 Reveal Credenza 474.27
10/31/97 1 Furniture Fabric 524.16
- 10/31/97 1 Xxxxxxxxx Ceramic Table Lamp 155.68
10/31/97 3 Institutional Stacker Chairs w/ arms
235.74
10/31/97 1 Xxxxxx Exam Table 1,114.40
- 10/31/97 1 Furniture Fabric 698.88
10/31/97 4 Xxxxxxx Wing Chair w/ reversible cus
1,215.68
10/31/97 1 Furniture Fabric 235.68
10/31 /97 1 Xxxxxxx Oval End Table 189.19
10/31/97 1 Grandview Sofa Table 650.72
Aft 10/31/97 8 Institutional Stacker Chairs
365.28
10/31/97 2 Decorator Bulletin Board 34.72
10/31/97 1 Xxxxxxx Sofa w/reversible cushions 463.58
10/31/97 9 Antrhom Posture Chair 1,873.44
10/31/97 11 Xxxxxxx Dining Table 2,205.50
10/31/97 2 Xxxxxxxxxx Xxxx Lamp 336.00
10/31/97 1 Xxxxxxx Straightback sofa 568.55
10/31/97 1 Furniture Fabric 309.12
10/31/97 1 Stain Repellant 95.20
10/31/97 4 Xxxxxxx Straightback Chair 1,144.92
10/31/97 2 Small Gooseneck Chair 379.22
10/31/97 1 Furniture Fabric 156.80
10/31/97 1 Stain Repellant 95.20
10/31/97 2 Xxxxxxx End Table 378.38
10/31/97 2 Pantheon Bakers Rack 918.40
10/31/97 80 Xxxxxxx Arm Chair w/casters 14,443.20
10/31/97 1 Furniture Fabric 996.27
10/31 /97 1 Furniture Fabric 265.32
10/31/97 1 Xxxxxxx Straightback Loveseat 332.50
10/31/97 1 Furniture Fabric 352.80
10/31/97 1 Acrylic Table Top 679.25
10/31/97 8 Xxxxxxx Custom Dining Table 1;837.28
10/31/97 8 Acrylic Table Top 544.32
10/31/97 2 Xxxxxxx Dining Table 423.68
Aft 10/31/97 2 Acrylic Table Top 123.50
10/31/97 1 Terrace Garden Door 890.40
10/31/97 1 Terrace Garden End Table 361.76
10/31/97 1 Remington Swing Arm Desk Larnp 207-20
10/31 /97 2 Falcon Table Top 241.92
10/31 /97 2 Falcon Table Base 310.22
10/31/97 1 Prairie Oak Sideboard 1,298.08
10/31/97 1 Prairie Oak Sideboard Gallery Rail 151.20
10/31/97 1 Pantheon Mirror 240.80
10/31/97 1 Chair to Match dimensions 295.68
10/31/97 1 Furniture Fabric 191.52
10/31/97 1 Craftsman Oval Dining Table 985.60
10/31/97 6 Trio Side Chair 1,391.04
10/31/97 1 Furniture Fabric 78_66
10/31/97 2 Trio Arm Chair 546.56
10/31/97 1 Furniture Fabric 26.22
10/31/97 1 EOC Printer Table 391.61
10/31/97 4 EOC Lateral File Cabinets 2,070.44
10/31/97 4 EOC Open Bookcase 973.76
10/31/97 1 Anthrom Posture Armchair 309.96
10/31/97 1 EOC Cylinder Table 195.56
10/31/97 1 Granite Top Mobile Server 993.44
10/31/97 2 Tanaier Lamp 380.80
10/31 /97 2 Anthrom Posture Armchair 619.92
10/31/97 3 Symmetry Arm Stack Chair 786.24
10/31/97 1 Special Reveal Desk 1.041.27
10/31/97 1 Evanston Cocktail Table 602.56
10/31 /97 1 Falcon Hospitality Table 612.62
10/31/97 1 Elmhurst Mirror 404.32
10/31/97 2 Tanaier Lamp 369.60
10/31/97 1 Tangier Lamp 207.20
10/31/97 1 Furniture Fabric 290.55
10/31/97 2 Xxxxxxx Wing Chair 489.00
10/31/97 1 Furniture Fabric 164.88
10/31/97 4 Settlement End Table 1,420.20
10/31/97 4 Pantheon Oval End Table 1,232.00
10/31/97 2 Xxxxx Xxxx Bench 266.72
10/31/97 1 Furniture Fabric 61.60
10/31 /97 1 Straightback Sofa 483.54
10/31/97 1 Furniture Fabric 245.85
10/31/97 2 Straightback Chair 572.46
10/31/97 1 Furniture Freight 14,444.51
10/31/97 1 Xxxxxxxxx.Xxx 14,696.47
04/28/97 1 Additional Furnishings 2,954.36
03/22/98 2 Trio Side Chair 463.68
03/22/98 1 Furniture Fabric 26.22
03/22/98 1 Furniture Freight 67.50
03/22/98 1 Furniture Tax 43.20
03/23/98 1 Signage (tax/freight included) 114.81
08/01/98 1 Additional Office Furniture 31,601.35
08/11/97 1 Kitchen Equipment 78,031.00
08/11/97 1 Kitchen Equipment Tax 6,047.40
1 Intercom System 6,500.00
1 Residential Appliances 50,623.15
1 Nurse Call System 35,500.00
TOTAL FURNITURE & EQUIPMENT 476,986.11
COMPUTER EQUIPMENT
5/10/97 Powersite, BCL Power Anywhere 1.939.50
5/27/97 Kronos Time Clock 3,662.42
5/27/97 LaserJet 6P 835.07
7/1/97 Clone p133 1.6 GB, 16MB 1,755.25
6/1-/98 GP6-266 System with MMX 1,577.46
10/1/99 Reps Software 1;772.49
12/15,'99 DeskJet Printer 225.20
12/15/99 Gateway Computer 1,217.57
11/1/00 Fax Machine/Printer/Scanner 299.31
1/25/01 Gateway Printer 214.42
1/25/01 Gateway Computer 1,204.65
2/12/01 Computer Equipment 421.94
3/1/01 Kronos Software 771.19
7/ 1 1 /01 Computer System 1,612.50
Total Computer Equipment 17.508.97
0
EXHIBIT C
TRANSFER OF OPERATIONS PROVISIONS
1. On the Lease Termination Date, Tenant shall transfer and convey to
Landlord all
consumable inventories of every kind and nature whatsoever (specifically
including, but
not limited to, all pharmacy supplies, medical supplies, office supplies, other
supplies and
foodstuffs) owned by Tenant as of the Lease Termination Date and located at the
Facility
(the "Inventory"). Tenant shall have no obligation to deliver the Inventory to
any
location other than the Facility, it being understood and agreed that the
presence of the
Inventory at the Facility on the Lease Termination Date shall constitute
delivery thereof.
Tenant shall execute a Xxxx of Sale in form and substance acceptable to
Tenant and
Landlord which confirms the conveyance of the Inventory provided for herein.
2. Transfer of Resident Deposits
--------------------------------
2.1. Within five (5) days after the Lease Termination Date, Tenant
shall prepare. and deliver to Landlord a true, correct, and complete accounting
and inventory (properly reconciled) of any resident deposits held by Tenant as
of the Lease Termination Date (the "Resident Deposits").
2.2. On the Lease Termination Date. Tenant shall transfer to Landlord the
'r Resident Deposits and Landlord hereby agrees that it will accept such
Resident Deposits
in trust for the residents/responsible parties and be accountable to the
residents/responsible parties for such Resident Deposits in accordance with the
terms of
this Agreement and applicable statutory and regulatory requirements
2.3. Landlord shall have no responsibility to the applicable
resident/responsible party and regulatory authorities in the event the Resident
Deposits delivered by Tenant to Landlord pursuant to Section 2.2 are
demonstrated to be less than the full amount of the Resident Deposits for such
resident as of the Lease Termination Date, for inaccuracies in the accounting
and inventory provided by Tenant, or for claims which arise from actions or
omissions of Tenant with respect to the Resident Deposits prior to the Lease
Termination Date.
2.4. From and after the Lease Termination Date Tenant shall have no
responsibility to the applicable resident/responsible party and regulatory
authorities with respect to any Resident Deposits delivered to Landlord.
3. Employees.
To the extent Tenant has any employees at the Facility during the Lease
Term, Tenant shall terminate all such employees at the Facility effective as of
the Lease Termination Date, and Tenant shall pay directly to such employees all
wages and benefits which are required by law to be paid to such employees as of
the Lease Termination
_ Date.
4. Access to Records.
-------------------
4.1. On the Lease Termination Date, Tenant shall deliver to LANDLORD
ALL of the records of the Facility. Nothing herein shall be construed as
precluding Tenant from removing from the Facility, with the consent of Landlord,
which shall not be unreasonably withheld, at reasonable times copies of the
financial records which relate to its operations at the Facility and/or the
originals of any proprietary materials related to its overall corporate
operations that are not necessary to the efficient operation of the Facility.
4.2. From and after the Lease Termination Date and for a period of one
(1) year thereafter, Landlord shall allow Tenant and its agents and
representatives to have reasonable access to (upon reasonable prior notice and
during normal business hours), and to make copies of, the books and records and
supporting material of the Facility relating to the period prior to and
including the Lease Termination Date, to the extent reasonably necessary to
enable Tenant to among other things investigate and defend malpractice, employee
or other claims, to file or defend tax returns, to verify accounts receivable
collections due Tenant. At the expiration of such one year period, Tenant shall
have the right, at its sole cost and expense to make copies of any of the
Facility records j which relate to the period covered by the Term of the Lease
which is reasonably deems to be necessary for the purposes described herein.
4.3. Tenant shall be entitled to remove the originals of any records
delivered to Landlord, for purposes of litigation involving a patient or
employee to whom such record relates, if an officer of or counsel for Tenant
certifies that such original must be produced in order to comply with applicable
law or the order of a court of competent jurisdiction in connection with such
litigation. Any record so removed shall promptly be returned to Landlord
following its use, and nothing herein shall be interpreted to prohibit Landlord
from retaining copies of any such documents.
The provisions of this Exhibit C shall survive the expiration or earlier
termination of the Term of the Lease.
EXHIBIT D
---------
FORM OF WORKING CAPITAL AGREEMENT
---------------------------------
WORKING CAPITAL AGREEMENT
THIS AGREEMENT is made and entered into as of the 21st day of February, 2002 by
and between Sacramento County Assisted LLC ("Landlord") and RAL, Inc.
("Tenant").
RECITALS
A. Tenant is the licensed operator of that 130 unit licensed residential care
facility for the elderly commonly known as Regent at Willow Creek and located in
Folsom, California (the "Facility").
B. Landlord has agreed to purchase the Facility, and Tenant has agreed to
lease the Facility back from Landlord pursuant to the terms of a certain
Lease dated this date between Landlord and Tenant (the "Lease"), which
Lease provides for a term commencing on the date Landlord acquires title
to the Facility and continuing until such time as Landlord and/or its
designee can secure a license to operate the Facility from the California
Department of Social Services or October 29, 2002, whichever is earlier
(the "Lease Term").
C. Landlord has agreed to provide Tenant with funds sufficient to cover the
expenses associated with the operation of the Facility during the Lease Term.
D. The parties are interested in documenting the terms and condition on
which such funding will be provided and the rights of each of the parties
hereto in and to such funding.
NOW, THEREFORE, in consideration of the foregoing premises and the mutual
covenants of the parties set forth herein, it is hereby agreed as follows:
1. Landlord shall provide Tenant with the funds required for the operation
of the Facility during the Lease Term on the following terms and conditions:
(a) Landlord and Tenant shall establish for the Facility a working capital
account ("Working Capital Account"). Such Working Capital Account shall be
available to Tenant for the payment of ordinary and necessary expenses for the
operation of the Facility. Landlord shall make deposits to the Working Capital
Account from time to tune as necessary to maintain a minimum balance of 530,000
at all tinges during the Lease Term. All of the expenditures by Tenant during
the Lease Term shall be ordinary and reasonable and consistent with past
practices. Any capital expenditures or expenses not in the ordinary course of
business shall be approved by Landlord in its sole discretion.
(b) Tenant shall cause to be prepared and provided to Landlord any reasonable
operational information with respect to the Facility which may from time to time
be specifically requested by Landlord, including any information needed to
assist Landlord in completing tax returns and in complying with the reporting
requirements. In addition, within thirty (30) days after the end of each
calendar month during the Lease Term, Tenant shall provide, or shall cause to be
provided, to Landlord an unaudited balance sheet of the Facility, dated the last
day of such month, and an unaudited statement of income and expenses for such
month and for the fiscal year to date relating to the operation of the Facility
showing trends, the variance between THE ACTUAL AND BUDGETED operating results
of the Facility for said month and with a rent roll and census report for the
month indicating the number of units occupied and the number of units vacant
(collectively, the "Statements"). Such monthly reports shall also show summary
and itemization of accounts receivable for the Facility and report of collection
action(s) taken and status of any collection action(s). Furthermore, Tenant
shall prepare and provide, or cause to be prepared and provided, to Landlord
such other reports and information as Landlord shall reasonably request. Upon
request, Tenant shall cooperate with Landlord or Landlord's certified public
accountant in the event Landlord elects, or is required, to have audited annual
financial statements prepared.
(c) In the event that the Statements for any month during the Lease Term
show a net operating profit, then the amount of such profit shall be remitted to
Landlord within three (3) business days after Landlord's receipt of the
Statement.
(d) For purposes hereof, the. cash receipts of the Facility shall be
defined as all cash received by the Facility in any manner, directly or
indirectly from the operation and use of the Facility, including without
limitation, fees and other amounts received directly from residents, all
receipts from the sale of food and beverages from the Facility, all receipts
from medical, nursing and personal care of patients or residents, amounts
received from concessionaires, subcontractors, agencies, etc., but shall
specifically exclude the proceeds from the sale of the Facility or any portion
thereof including any of the Facility equipment and any insurance and
condemnation proceeds and any and all pass through amounts for which Tenant is
merely acting as the collection agent. The cash disbursements of the Facility
shall not include depreciation or amortization expense, but shall include
capital expenditures approved by Landlord.
(e) Tenant covenants and agrees that during the Lease Term it shall cause the
Facility to be operated in accordance with its past practices (except to the
extent such practices are modified at the request of regulatory authorities)
including, but not limited to, paying its accounts payable and incurring
operating expenses in accordance with its past operating practices. In
furtherance and not in limitation of the foregoing, Tenant shall be deemed to
have incurred operating expenses in accordance with past practices (A) if at
anytime during the Lease Term the Facility is not subject to extraordinary
regulatory sanctions, such as stop placement orders, if such expenses are
consistent with the amounts expended during prior periods when the Facility was
not subject to such extraordinary regulatory sanctions and (B) if at anytime
during the Lease Term the Facility is subject to extraordinary regulatory
sanctions, such as stop placement orders, if such expenses are consistent with
the amounts expended during prior periods when the Facility was subject to such
extraordinary regulatory sanctions. In addition to the foregoing, expenses
related to the maintenance and/or renewal of Tenant's Facility license,
including without limitation fees and reasonable travel expenses, if any, shall
be reasonable expenses covered by Section 1(a).
(f) In the event Tenant receives invoices subsequent to the expiration
or earlier termination of the Lease Term which relate to the expenses incurred
by Tenant in connection with the operation of the Facility and were incurred by
Tenant in accordance with this Agreement during the Lease Term and which were
not included in the Statements which are the subject of this Section I(e), it
shall forward the same to Landlord and Landlord shall timely process the same
for payment. In the event Tenant receives and pays invoices subsequent to the
expiration or earlier termination of the Lease Term which relate to expenses
incurred by Tenant in connection with the operation of the Facility during the
Lease Term and ,which were not included in the Statements which are the subject
of this Section 1, upon submission to Landlord of copies of the applicable
invoices along with documentation confirming such payment, Landlord shall timely
reimburse Tenant for such payments. Any payments due from Landlord to Tenant
pursuant to this -Section 1(e) which are not paid within thirty (30) days after
Landlord's receipt of Tenant's request for payment shall bear interest at the
rate of 1 % per month from the date of submission to Landlord to the date paid
by Landlord. Landlord's obligation to, pay the invoices described in this
Section I(e) is subject to Tenant's obligation to have incurred the same in
accordance with the operating requirements. set forth in Section I(e) and to the
limitations on Landlord's obligations set forth in Section 1(e) .
(g) Notwithstanding anything otherwise set forth herein, Tenant
acknowledges and agrees that Landlord's obligations under this Agreement shall
be subject to the following additional limitations: (i) Landlord shall have no
obligation to reimburse Tenant for any amounts expended by Tenant to cure a
default under the Lease or under this Agreement unless Tenant is able to
demonstrate that such default is solely and directly attributable to a breach by
Landlord of its obligations under this Agreement, (ii) Landlord shall have no
obligation to reimburse Tenant for any amounts expended with respect to the
operation of the Facility from and after the occurrence of a material default
under the Lease until such time as the default is cured; provided, however,
nothing herein shall preclude Landlord from providing such reimbursement subject
to any rights or remedies available to it under the Lease as a result of such
default, and (iii) Landlord shall have no obligation to reimburse Tenant for any
amounts expended with respect to the operation of the Facility by Tenant from
and after the expiration or earlier termination of the Lease. All sums expended
for matters which Tenant is obligated to pay for under Articles 7, 12 and 14, or
paragraph 8.2.5 of the Lease are agreed to be amounts expended in the ordinary
course of business.
2. Tenant shall have no obligation to repay to Landlord the amounts advanced
pursuant to this Agreement and there shall be no proration of revenues or
expenses related to the operation of the Facility during the Lease Term between
Landlord and Tenant it being understood and agreed that, notwithstanding
anything contained in the Services Agreement to the contrary, Landlord shall be
entitled to all such revenues and shall be responsible for all such expenses,
subject to the limitations set forth in this Agreement.
3. Landlord shall indemnify and hold harmless Tenant, all affiliates, successors
and assigns of Tenant, and all of Tenant's and such affiliates, successor's and
a1,,,,n's directors, officers, employees and agents FROM AND AGAINST ANY AND ALL
DEMANDS, claims, causes of action, fines, penalties, damages (including
consequential damages), losses, liabilities (including strict liability),
judgments, and expenses (including, without limitation, reasonable attorneys'
and other professionals' fees and court costs) incurred in connection with or
arising from: (i) Landlord's operation of the Facility after the Lease Term has
expired and Tenant has vacated the Facility, (ii) any breach, violation, or
nonperformance of any law, ordinance, or governmental requirement of any kind by
Landlord with respect to the Facility after the Lease Term has expired and
Tenant has vacated the Facility; and (ii) any injury or damage to the person,
property or business of Landlord, its employees, agents, contractors, invitees,
visitors, or any other person
entering upon the Facility that occurs after the Lease Term has expired and
Tenant has vacated the Facility. In addition, Landlord shall indemnify and hold
harmless Tenant and Emeritus and their respective shareholders, directors,
officers and employees from any and all third party claims, demands, causes of
action, losses, damages, fines, penalties, liabilities, costs and expenses,
including attorneys' fees and court costs (except to the . extent covered by
insurance carried or required to be carried pursuant to the Lease) sustained or
incurred by or asserted against any one or more of them relating to the Facility
that results from the negligence or willful misconduct of Landlord in performing
its obligations under this Agreement or from a breach of this Agreement by
Landlord.
4. Tenant shall indemnify and hold harmless Landlord, its partners, members
(including the shareholders, officers and directors of any corporate partner or
member), agents, employees, successors and lenders from and against any and all
demands, claims, causes of action, fines, penalties, damages (including
consequential damages), losses, liabilities (including strict liability),
judgments, and expenses (including, without limitation, reasonable attorneys'
and other professionals' fees and court costs) caused by, or arising in
connection with, any negligent act or omission or willful misconduct of Tenant,
its agents, contractors, employees or invitees.
5. This Agreement, together with the Lease, represents the entire and final
agreement of the parties hereto with respect to the subject matter hereof and
supersedes all prior negotiations, discussions or writings with respect thereto.
This Agreement may not be amended or modified except by written instrument
signed by the parties hereto. Notwithstanding the foregoing, Tenant specifically
acknowledges and agrees that any and all rights granted to Tenant under the
Lease shall be subject to any limitations imposed on Tenant under this Agreement
with respect to the operation of the Facility.
6. In the event of a dispute among the parties hereto with respect to
the interpretation or enforcement of the terms hereof no provision shall be
construed so as to favor or disfavor either party hereto. In the event of a
conflict between the provisions of this Agreement and the provisions of the
Lease regarding Landlord's obligation to reimburse Tenant for expenses the
provisions of this Agreement shall apply.
7. In the event of a litigated dispute among the parties hereto with
respect to the interpretation or enforcement of the terms hereof the prevailing
party shall be entitled to collect its reasonable attorneys fees and costs,
including its costs and fees on appeal.
8. This Agreement may be executed in counterparts, each of which shall be
deemed to be an original, but all of which taken together shall constitute but
one and the same instrument.
9. This Agreement shall be governed by and construed in accordance with
the laws of the State of California.
10. Any notice required to be provided hereunder shall be sent by (i)
overnight delivery, with provision for a receipt, postage or delivery charges
prepaid; or (iii) facsimile transmission. All notices shall be addressed to the
parties at the addresses set forth below:
If to Landlord: Sacramento County Assisted, LLC
0000 Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxx XX 00000
(000) 000-0000
Attn: Xxxx Xxxxxxx
With copy to: Xxxxx Xxxxx LLP
Xxx Xxxxxxx Xxxxx
Xxxxxxxxxxxx, XX 00000-0000
(000) 000-0000
Attn: Xxxxx X. Xxxx
If to Tenant: RAL, Inc. d/b/a RAL-Operations, Inc.
000 XX Xxxxxxxx Xx., Xxxxx 0000
Xxxxxxxx, XX 00000
(000)- 000-0000
Attn: Xxxxxx X. Xxxx
Will] copy to: Stoel Rives LLP
000 XX Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxx, XX 00000
(000) 000-0000
Attn: Xxxx X. Xxxxxx
Any such notice, if sent (a) by overnight delivery, shall be deemed
delivered on the earlier of the date of actual delivery or the next business day
following deposit, postage prepaid, with such overnight delivery service, or (b)
by facsimile, shall be deemed delivered on the date when such facsimile was
confirmed as received. Either party may change its address for notice purposes
by giving notice of its new address to the other party in accordance with the
terms of this Section 9.
11. In the event any provision of this Agreement is deemed to be invalid or
unenforceable said determination shall not affect the validity or enforceability
of the remaining provisions of this Agreement.
IN WITNESS WHEREOF, the parties hereby execute this Agreement as of the day
and year first set forth above.
Sacramento County Assisted LLC
By: Columbia Pacific DA '02
Limited Partnership. Its sole member
By: BF Limited Partnership
By: /s/ Xxxxxx X. Xxxx
Name: Xxxxxx X. Xxxx
Title: Partner
RAL, Inc., an Oregon corporation doing business as RAL-Operations, Inc.
By: /s/ Xxxx Xxxxx
Name: Xxxx Xxxxx
Title:
