EXHIBIT 10.7
SUBLEASE AGREEMENT
THIS SUBLEASE is made as of the ____ day of ________________, 1999 by
and between HEALTHTRUST, INC. - THE HOSPITAL COMPANY, a Delaware corporation
("Sublessor"), and LIFEPOINT HOSPITALS, INC., a Delaware corporation
("Sublessee"), under the following circumstances:
A. Pursuant to a certain Lease Agreement, dated December 20, 1996
(the "Prime Lease"), a copy of which is attached hereto as Exhibit A,
Institutional Real Estate Fund II, a California limited partnership ("Prime
Lessor") has leased to Sublessor the premises described therein (the
"Premises").
B. Sublessee desires to lease a portion of the premises leased under
the Prime Lease from Sublessor and Sublessor desires to lease the same to
Sublessee, on the terms and conditions set forth in this Sublease, and
NOW, THEREFORE, in consideration of the covenants and agreements of
the parties hereinafter set forth and other good and valuable consideration,
receipt of which is hereby acknowledged by the parties, Sublessor and Sublessee
hereby agree as follows:
1. Subleased Premises. Sublessor hereby subleases to the Sublessee a
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portion of the premises described in the Prime Lease (hereinafter the "Subleased
Premises") more particularly described on Exhibit A attached hereto and by
reference incorporated herein.
2. Term. The term of this Sublease shall commence on ___________,
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1999 and terminate on February 28, 2002 (the "Term"). Sublessor and Sublessee
shall each have the right to terminate this Sublease by notice to the other
party specifying the termination date which must not be earlier than six (6)
months from the date of such notice.
3. Rent. Sublessee shall pay to Sublessor rent for the Subleased
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Premises equal to all rent payable by Sublessor under the Prime Lease (excluding
rent payable pursuant to Rider No. 2 of the Prime Lease) multiplied by a
fraction with the numerator being the number of rentable square feet in the
Subleased Premises and the denominator being the total number of rentable square
feet of the Premises under the Prime Lease (excluding space leased pursuant to
Rider No. 2 of the Prime Lease) ("Sublessee's Share"). Sublessee's Share of
base rent payable to Sublessor shall be the monthly sum of $____________ payable
in advance on the first day of each month, commencing with the first payment on
_____________, 1999 and continuing on the first day of each calendar month
thereafter until September 1, 1999, on which date such monthly sum shall be
increased to $______________ and such sum shall be payable to Sublessor on the
first day of each calendar month thereafter without demand so long as this
Sublease remains in effect. The rent due for any fractional month during the
term of this Sublease shall be prorated based on the number of days in such
month. Sublessee shall pay as additional rent Sublessee's Share of operating
expenses and any other payment of rent or other payments required to be made by
Sublessor under the terms of the Prime Lease. Additionally, Sublessee agrees to
pay to Sublessor an amount equal to Sublessee's Share of Sublessor's total
expenses for security services incurred with respect to the Premises under the
Prime Lease. The initial monthly payment for security services shall be
$______________. Such sum shall be payable on the due date of the first monthly
installment of rent payable to Sublessor under this Sublease and security
expenses for fractional months shall be prorated. Upon any change in the cost
of security
services, Sublessor shall notify Sublessee of such change and Sublessee shall
pay Sublessee's Share of such revised amount from the date of change in the cost
of such services and Sublessee shall pay to Sublessor the revised monthly amount
for security services. All sums payable by Sublessee to Sublessor pursuant to
this Paragraph 3 are hereinafter referred to as "rent."
4. Assignment/Further Subletting. Sublessee shall not, either
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voluntarily or by operation of law, directly or indirectly sell, hypothecate,
assign or transfer this Sublease, in whole or in part, or further sublet all or
any part of the Subleased Premises, or permit the Subleased Premises to be
occupied by any other person, without the prior written consent of Sublessor and
Prime Lessor in each instance.
Notwithstanding the provisions of the first paragraph of this
Paragraph 4, after first obtaining the prior written consent of Prime Lessor,
Sublessee may assign or sublet the Subleased Premises, or any portion thereof,
without Sublessor's consent, to any corporation which controls, is controlled
by, or is under common control with Sublessee or to any corporation resulting
from the merger or consolidation with Sublessee, or to any person or entity
which acquires all the assets of Sublessee as a going concern of the business
that is being conducted on the Subleased Premises, provided that before such
assignment or sublease shall be effective, (i) said assignee or sublessee shall
assume, in full, the obligations of Sublessee under this Sublease, and (ii)
Sublessor shall be given written notice of such assignment and assumption. Any
such assignment or subletting shall not, in any way, affect or limit the
liability of Sublessee under the terms of this Sublease even if after such
assignment or subletting the terms of this Sublease are materially changed or
altered without the consent of Sublessee, the consent of whom shall not be
necessary.
Any sale, assignment, mortgage, transfer or subletting of this
Sublease, which is not in compliance with the provisions of this Paragraph 4
shall be void and at the option of Sublessor, Sublessor may terminate this
Sublease. Each such permitted assignment, transfer or further subletting of the
Subleased Premises, shall be subject and subordinate to the Prime Lease and this
Sublease and each such assignee or sublessee shall be bound to perform, observe
and comply with all of the covenants, agreements and terms and conditions of
this Sublease, all of which shall be specifically assumed in writing by such
assignee or sublessee. Upon the consummation of any such transfer, assignment
or sublease, Sublessee shall deliver to Sublessor promptly thereafter, a copy of
the fully executed assignment, sublease or other instrument of transfer. The
consent of Sublessor or Prime Lessor to any one assignment or sublease shall not
relieve Sublessee or its assignee or subtenants from obtaining the prior written
consent of Prime Lessor and Sublessor to any further assignment or subletting
and shall not release Sublessee from any liability or obligation hereunder,
whether or not then accrued.
5. Prime Lease. Sublessor represents that a true and complete copy
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of the Prime Lease, as amended, supplemented and modified, is attached hereto as
Exhibit B and Sublessee acknowledges receipt thereof. Sublessor represents and
warrants that the Prime Lease is in full force and effect and Sublessor has no
knowledge of any defaults under the Prime Lease. This Sublease is subject and
subordinate to the Prime Lease, all of the terms and conditions thereof and the
performance by Prime Lessor of all of its obligations thereunder, and to the
extent approved by Sublessee, which approval will not be unreasonably withheld,
all amendments and supplements hereafter entered into. All terms contained in
this Sublease shall
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have the same meanings and definitions ascribed to them in the Prime Lease,
unless any such term is expressly defined in this Sublease or the context
requires otherwise. Sublessee shall not commit or permit to be committed on the
Subleased Premises any act or omission which violates any term or condition of
the Prime Lease. In the event of the termination of the Sublessor's interest as
Sublessee under the Prime Lease for any reason other than a default by Sublessor
under the Prime Lease which occurs for any reason other than a breach or a
default by Sublessee under this Sublease, then this Sublease shall terminate
coincidentally therewith without any liability of Sublessor to Sublessee.
Sublessee shall only have such rights with respect to the Leased Premises which
Sublessor has pursuant to the Prime Lease. Except as specifically exempted as
provided below in this Paragraph 5, Sublessee shall assume, perform and observe
all of the obligations of Sublessor as Lessee under the Prime Lease, to the
extent that such terms and conditions are applicable to the Subleased Premises,
including without limitation thereto payment (or in the case of payment in the
first instance by Sublessor, reimbursement of Sublessor for payment) of
Sublessee's Share of all rent which becomes due under the Prime Lease.
Sublessee's performance and observance of all such obligations shall be effected
so that, whenever time periods are specified in the Prime Lease for Sublessor's
compliance as Lessee thereunder, Sublessee shall have so complied on or prior to
such date, unless otherwise specifically provided herein. Except as otherwise
provided in this Sublease, all of the terms and conditions contained in the
Prime Lease, except for the provisions of 1.2, 1.5, 1.6, 1.7, 1.10, 2.2, 3, 4,
12, 15, Rider No. 1, and Rider No. 2, are incorporated herein as terms and
conditions of this Sublease (with each reference in the Prime Lease to "Lessor"
being deemed to refer to Sublessor and Prime Lessor, with each reference to
"Lessee" therein being deemed to refer to Sublessee and with each reference to
the Premises being deemed to refer to the Subleased Premises); and all such
provisions along with all of the provisions specifically set forth in this
Sublease, shall be the complete terms and conditions of this Sublease.
If Prime Lessor shall be in default of any of its obligations under
the Prime Lease, Sublessee shall be entitled to all rights and remedies against
Prime Lessor which Sublessor would otherwise be entitled to under the Prime
Lease as a result of such default; subject, however, to the following provisions
and procedures: Insofar as Prime Lessor is or may be obligated to construct or
make any alterations or improvements to the Subleased Premises, to furnish any
services to the Leased Premises, to repair or rebuild the same, to insure the
Subleased Premises, to perform any other act whatsoever with respect to the
Premises or the Subleased Premises or to perform any obligation or satisfy any
condition under the Prime Lease, Sublessee expressly acknowledges that
notwithstanding anything to the contrary provided in this Paragraph 5, Sublessor
does not undertake the performance or observance of such obligations, but is
only obligated to use reasonable efforts to obtain Prime Lessor's performance
for Sublessee's benefit and without obligating itself to institute legal action
or incur any out of pocket expense. If after receipt of written request from
Sublessee, Sublessor fails or refuses to take appropriate action for the
enforcement of Sublessor's rights against Prime Lessor with respect to the
Leased Premises, Sublessee shall have the right to take such action in
Sublessee's own name and for that purpose and only to such extent, Sublessor's
rights under the Prime Lease shall be and hereby are conferred upon and assigned
to Sublessee. Sublessee shall be subrogated to such rights to the extent that
the same shall apply to the Subleased Premises. If any such action against
Prime Lessor in Sublessee's name shall be barred by reason of lack of privity,
nonassignability or
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otherwise, Sublessor shall permit Sublessee to take such action in Sublessor's
name; provided, however, that Sublessee shall indemnify, defend and hold
Sublessor harmless from and against all liability, expense, loss or damage which
Sublessor may incur or suffer by reason of any such action, and that copies of
all papers, and notices of all proceedings, shall be given to Sublessor.
6. Late Charges. Sublessee hereby acknowledges that late payment by
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Sublessee to Sublessor of Rent and other sums due hereunder will cause Sublessor
to incur costs not contemplated by this Sublease, the exact amount of which will
be extremely difficult to ascertain. Such costs include, but are not limited
to, processing and accounting charges, and late charges which may be imposed on
Sublessor. Accordingly, if any installment of Rent or any other sum due from
Sublessee shall not be received by Sublessor within 10 days after such amount
shall be due, Sublessee shall pay to Sublessor a late charge equal to 3% of such
overdue amount. The parties hereby agree that such late charge represents a
fair and reasonable estimate of the costs Sublessor will incur by reason of late
payment by Sublessee.
7. Defaults and Remedies. The following events of default and
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remedies shall govern this Sublease:
(a) Defaults. The following events shall constitute a material
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default under this Sublease:
(i) The failure by Sublessee to make any payment of rent or
any other payment required to be made by Sublessee hereunder, as and when due,
where such failure shall continue for a period of 10 days after written notice
thereof from Sublessor or Prime Lessor.
(ii) The failure by Sublessee to observe or perform any of
the covenants, conditions or provisions of this Sublease to be observed or
performed by Sublessee other than those described in Section (i) above, where
such failure shall continue for a period of 30 days after written notice thereof
from Sublessor or Prime Lessor, provided that if the cure of such breach shall
reasonably require more than 30 days, then Sublessee shall not be in default if
Sublessee commenced such cure within said 30 day period and thereafter
diligently prosecutes such cure to completion.
(iii) The making by Sublessee of any general assignment, or
general arrangement for the benefit of creditors; the filing by or against
Sublessee of a petition to have Sublessee adjudged a bankrupt or a petition for
reorganization or arrangement under any bankruptcy law (unless the petition
filed against Sublessee is dismissed within 90 days); the appointment of a
trustee or receiver to take possession of substantially all of Sublessee's
assets located at the Subleased Premises or of Sublessee's interest in this
Sublease, where possession is not restored to Sublessee within 30 days; or the
attachment, execution or other judicial seizure of substantially all of
Sublessee's assets located at the Subleased Premises or of Sublessee's interest
in this Sublease, where such seizure is not discharged within 60 days.
(b) Remedies. In the event of any such material default, Sublessor
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may at any time thereafter, and without limiting Sublessee in the exercise of
any right or remedy which Sublessor may have by reason of such default:
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(i) Terminate Sublessee's right to possession of the
Subleased Premises by any lawful means, in which case this Sublease shall
terminate and Sublessee shall immediately surrender possession of the Subleased
Premises to Sublessor. In which event Sublessor shall be entitled to recover
from Sublessee all damages incurred by Sublessor by reason of Sublessee's
default including, but not limited to, the cost of recovering possession of the
Subleased Premises; expenses of reletting, including renovation and alteration
of the Subleased Premises, reasonable attorney's fees, and any real estate
commissions actually paid; the worth at the time of award of the amount by which
the unpaid rent for the balance of the term after the time of such award exceeds
the amount of such rental loss for the same period that Sublessee proves could
be reasonably avoided; and that portion of any leasing commission paid by
Sublessor applicable to the unexpired term of this Sublease. Unpaid installments
of Rent or other sums shall bear interest from the date due at the "prime rate"
of interest as announced from time to time in the Wall Street Journal plus 2%,
but in no event more than the maximum interest allowed by law (which rate is
hereinafter referred to as the "Interest Rate"). If Sublessee abandons the
Subleased Premises, Sublessor shall have the option of retaking possession of
the Subleased Premises and recovering from Sublessee the amount as specified in
this paragraph.
(ii) Maintain Sublessee's right to possession in which case
this Sublease shall continue in effect whether or not Sublessee shall have
abandoned the Subleased Premises. In such event, Sublessor shall be entitled to
enforce all of Sublessor's rights and remedies under this Sublease, including
the right to recover the rent as it becomes due hereunder.
(iii) Sublessor may remove any or all items of Sublessee's
property from the Subleased Premises and dispose of them in any commercially
reasonable manner, and Sublessee shall pay upon demand to Sublessor the actual
expense of such removal and disposition together with interest at the Interest
Rate, but in no event more than the maximum interest allowed by law, from the
date of payment by Sublessor until repayment by Sublessee.
(iv) Pursue any other remedy now or hereafter available to
Sublessor under the laws or judicial decisions of the State of Tennessee.
8. Notices. Any notice or other communication required or permitted
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to be given under this Sublease shall be in writing and shall be deemed to have
been effectively given if delivered personally or if mailed certified mail,
postage prepaid, return receipt requested, or sent by nationally recognized
overnight carrier as follows:
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If to Sublessor:
Healthtrust, Inc. - The Hospital Company
c/o Columbia/HCA Healthcare Corporation
One Park Plaza
Building 2, 5th Floor
Nashville, TN 37203
If to Sublessee:
LifePoint Hospitals, Inc.
4525 Harding Road
Suite B-300
Nashville, TN 37205
Attn. Neil Hemphill
Any party may change the address to which notices and other
communications are to be directed to it by giving notice of such change to the
other party in the manner provided in this section.
9. Parking. Sublessee shall have the use of 57 parking spaces in
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the Office Building Project on an unreserved basis.
10. Headings. The use of headings, captions and numbers in this
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Sublease is solely for the convenience of identifying and indexing the various
paragraphs, and shall in no event be considered otherwise in construing or
interpreting any provision of this Sublease.
11. Severability. If any term, covenant, conditions or provision of
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this Sublease, or the application thereof to any person or circumstance shall
ever be held to be invalid or unenforceable, then, in each such event, the
remainder of this Sublease or the application of such term, covenant, condition
or provision to any other person or any other circumstances (other than those as
to which it shall be invalid or unenforceable) shall not be thereby affected,
and each term, covenant, condition and provision hereof shall remain valid and
enforceable to the fullest extent provided by law.
12. Entire Agreement. This Sublease (including the Exhibits, the
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Prime Lease and all supplementary agreements provided for herein, if any)
contains the entire agreement of the Sublessor and the Sublessee and no
representations, warranties, inducements, promises or agreements, oral or
otherwise, between the parties not described in this Sublease shall be of any
force or effect.
13. Modifications. This Sublease shall not be modified or amended in
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any respect except by a written agreement executed by the Sublessor and the
Sublessee in the same manner as this Sublease is executed.
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IN WITNESS WHEREOF, Sublessor and Sublessee have executed this
instrument as of the day and year first written above.
SUBLESSOR:
HEALTHTRUST, INC. - THE HOSPITAL
COMPANY
By: _____________________________________
Title: ___________________________________
SUBLESSEE:
LIFEPOINT HOSPITALS, INC.
By: ______________________________________
Title: __________________________________
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EXHIBIT A
DESCRIPTION OF SUBLEASED PREMISES
EXHIBIT B
PRIME LEASE