YORK CARE FACILITY
YORK, SOUTH CAROLINA
AGREEMENT TO PROVIDE ACCOUNTING
AND ADMIMSTRATIVE SERVICES
TO AN ASSISTED LIVING FACILITY
AGREEMENT TO PROVIDE ACCOUNTING AND
ADMINISTRATIVE SERVICES TO AN INDEPENDENT/ASSISTED
LIVING FACILITY
This Agreement made this 31, day of March,
1997 by and between EMERITUS CORPORATION, a
Washington corporation (hereinafter referred to as
"Administrator"), and COLUMBIA HOUSE, LLC, a
Washington limited liability company (hereinafter
referred to as "Lessee").
WHEREAS, Lessee is the lessee of property
located at 00-00 Xxxx Xxxxxx Xxxxxx in York, South
Carolina (the "Property") including an assisted
living facility (the "Facility"), pursuant to the
terms of that certain Lease Agreement dated
January 13,1997 between Xxxxxx Xxxxx, an
individual resident in the state of South
Carolina, as lessor, and Lessee, as lessee (the
"Facility Lease");
WHEREAS, Lessee is interested in retaining
Administrator to assist it with certain
administrative and accounting functions (the
"Administrative Responsibilities");
WHEREAS, Administrator is experienced and
qualified in the field of health care management
and is qualified to provide Lessee with assistance
with the Administrative Responsibilities; and
WHEREAS, Lessee and Administrator are
interested in documenting the terms and conditions
under which said assistance will be provided.
NOW THEREFORE, in consideration of the
foregoing premises and the mutual covenants herein
contained, IT IS AGREED AS FOLLOWS:
I. RESPONSIBILITIES OF ADMINISTRATIOR:
Lessee ' hereby engages Administrator and
Administrator hereby accepts such engagement and
agrees to assist Lessee with respect to the
performance by Lessee of the Administrative
Responsibilities. By entering into this Agreement,
Lessee does not delegate to Administrator any
powers, duties or responsibilities which it is
prohibited by law from delegating. Lessee also
retains such other authority as shall not have
been expressly delegated to Administrator pursuant
to this Agreement. Subject to the foregoing,
Administrator shall provide the following
services:
A. CHARGES: Administrator shall assist Lessee
in establishing the schedules of recommended
charges, including any and all special charges for
services rendered to the residents at the
Facility.
B. ACCOUNTING: Administrator shall provide
administrative and accounting support to the
Facility. All accounting procedures and systems
utilized in providing said support shall be in
accordance with the operating capital and cash
programs developed by Administrator; which
programs shall conform to generally accepted
accounting principles and shall not materially
distort income or loss. In addition, at Lessee's
sole cost and expense, Administrator shall prepare
or cause to be prepared all payroll tax returns
and shall cause all local taxes to be timely paid
or contested, as appropriate (for purposes of
clarification Lessee shall be responsible for
preparation and filing of state and federal tax
returns). The costs incurred by Administrator in
preparing such returns shall not be included in
Administrator's management fee, but shall be
separately reimbursed by Lessee.
C. REPORTS: Within thirty (30) days after the
end of each calendar month, Administrator shall
provide Lessee with 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 relating to the operation of the
Facility. Within ninety (90) days after the end of
the fiscal year of the Facility, Administrator
shall provide Lessee with unaudited financial
statements including a balance sheet of the
Facility, dated the last day of said fiscal year,
and a statement of income and expense for the year
then ended relating to the operation of the
Facility.
D. PERSONNEL:
(i) All employees shall remain the
employees of Lessee. Administrator shall
administer, including payroll tax reporting, and
Lessee shall fund, payroll twice monthly, in
accordance with all applicable federal and state
laws and regulations. Lessee shall promptly
reimburse Administrator for all amounts expended
by Administrator in connection therewith.
(ii) Lessee shall hire, train, promote,
direct, discipline, suspend and discharge
personnel at the Facility; establish salary levels
and personnel policies; and establish employee
performance standards, all as needed during the
term of this Agreement to ensure the efficient
operation of all departments within and services
offered by the Facility. Lessee shall, as a matter
which shall survive any termination of this
Agreement, indemnify, defend and hold harmless
Administrator from and against any and all costs,
expenses, liabilities, suits or other causes of
action arising from or relating to the employment
of employees at the Facility.
E. INSURANCE: During the term hereof, Lessee,
at its sole cost and expense, shall arrange for
and maintain (i) all necessary and proper hazard
insurance covering the Facility, the furniture,
fixtures, and equipment situated thereon, (ii) all
employee health
insurance for so long as it is the employer of the
Facility employees under the terms hereof, which
insurance shall be administered by Lessee and
(iii) all necessary and proper malpractice and
public liability insurance for the protection of
itself, its officers, agents and employees. Any
insurance provided pursuant to this paragraph
shall comply with the requirements of the Facility
Lease.
III. PROPRIETARY INTEREST: The systems,
methods, procedures and controls employed by
Administrator and any written materials or
brochures developed by Administrator to document
the same are to remain the property of
Administrator and are not, at any time during or
after the term of this Agreement, to be utilized,
distributed, copied or otherwise employed or
acquired by Lessee, except as authorized by
Administrator.
IV. TERM: The Term of this Agreement shall
commence on April 1,1997 or such later date on
which the transaction with respect to the
financing of the Renovations occurs as evidenced
by a written acknowledgment of Lessee and
Administrator (the "Commencement Date") and shall
terminate concurrently with the termination of the
Facility Lease.
V. DEFAULT: Either party may terminate this
Agreement, as specified in this Section V, in the
event of a default ("Event of Default") by the
other party.
(a) With respect to Administrator, it shall
be an "Event of Default" hereunder:
(i) If
Administrator shall fail to keep, observe or
perform any material agreement, term or provision
of this Agreement, and such default shall continue
for a period of thirty (30) days after notice
thereof shall have been given to Administrator by
Lessee, which notice shall specify the event or
events constituting the default; or
(ii) If Administrator shall apply
for or consent to the appointment of a receiver,
trustee or liquidator of Administrator of all or a
substantial part of its assets, file a voluntary
petition in bankruptcy, or admit in writing its
inability to pay its debts as they become due,
make a general assignment for the benefit of
creditors, file a petition or an answer seeking
reorganization or arrangement with creditors or
taking advantage of any insolvency law, or if an
order judgment or decree shall be entered by a
court of competent jurisdiction, on the
application of a creditor, adjudicating
Administrator, a bankrupt or insolvent or
approving a petition seeking reorganization of
Administrator, or appointing a receiver, trustee
or liquidator of Administrator, of a11 or a
substantial part of its assets.
(b) With respect to Lessee, it shall be an
Event of Default hereunder:
(i) If Lessee shall fail to make or
cause to be made any payment to Administrator
required to be made hereunder (other than its
working capital obligation), and such failure
shall continue for a period of thirty (30) days;
(ii) If Lessee shall fail to keep,
observe or perform any material agreement, term or
provision of this Agreement and such default shall
continue for a period of thirty (30) days after
notice, which notice shall specify an event or
events constituting the default thereof by
Administrator to Lessee; provided, however, that
in the case of Lessee's failure to provide
necessary working capital upon demand by
Administrator, it shall be deemed to be an Event
of Default hereunder if the same is not paid
within ten (10) days of Administrator's initial
demand therefor without any further notice from
Administrator being required;
(iii) If Lessee shall fail to make
payments, or keep any covenants, owing to any
third party which are beyond the control of
Administrator to make or keep, and which would
cause Lessee to lose possession of the Facility or
any personal property which would be required to
operate the Facility in the normal course; or
(iv) If Lessee shall be dissolved
(other than as a result of a transfer of the
ownership of the Facility to a limited partnership
in which Lessee's shareholders are general and/or
limited partners) or shall apply for or consent to
the appointment of a receiver, trustee or
liquidator of Lessee or of all or a substantial
part of its assets, file a voluntary petition in
bankruptcy, or admit in writing its inability to
pay its debts as they become due, make a general
assignment for the benefit or creditors, file a
petition or an answer seeking reorganization or
arrangement with creditors or taking advantage of
any insolvency law, or if an order, judgment or
decree shall be entered by a court of competent
jurisdiction, on the application of a creditor,
adjudicating Lessee a bankrupt or insolvent or
approving a petition seeking reorganization of
Lessee or appointing a receiver, trustee or
liquidator of Lessee of all or a substantial part
of its assets.
VI. REMEDIES UPON DEFAULT:
(a) If any Event of Default by Lessee
shall occur, Administrator may, in addition to any
other remedy available to it in law or equity on
account of such Event of Default, forthwith
terminate this Agreement, and neither party shall
have any further obligations whatsoever under this
Agreement, but Administrator shall immediately be
entitled to receive payment of all amounts
theretofore unpaid but earned to the date of
termination.
(b) If any Event of Default by
Administrator shall occur, Lessee may, in addition
to any other remedy available to it in law or
equity on account of such Event of Default,
forthwith terminate this Agreement, and neither
party shall have any further obligation whatsoever
under this Agreement; provided, however, that
Administrator shall immediately be entitled to
receive payment of all amounts theretofore unpaid
but earned to date of termination, subject to
Lessee's right to receive payment of damages from
Administrator.
VII. LESSEE'S INSPECTION: During the term
hereof, Lessee shall have the right, upon request
and at reasonable times, to inspect and/or audit
all books and records pertaining to the operation
of the Facility prepared or maintained by
Administrator.
VIII. ADMINISTRATIVE SERVICES FEE: Throughout
the term of this Agreement, Administrator shall
receive a monthly fee equal to $2,500.00 per
month.
A. PRORATION OF FEE. If the services of
Administrator commence or terminate (for any
reason, including those set forth in Paragraph V)
other than on the first day of the month, the fee
shall be prorated in proportion to the number of
days for which services are actually rendered.
B. PAYMENT OF FEE. The Management fee
provided for herein shall be payable to
Administrator on the first day of each month, with
the first such payment due on the Commencement
Date.
IX. ASSIGNMENT: This Agreement shall not be
assigned by either party without the prior written
consent of the other party, which consent shall
not be unreasonably withheld.
X. NOTICES: All notices required or permitted
hereunder shall be given in writing by hand
delivery, by registered or certified mail, postage
prepaid, by overnight delivery or by facsimile
transmission (with receipt confirmed with the
recipient). Notice shall be delivered or mailed to
the parties at the following addresses or at such
other places as either party shall designate in
writing.
To Administrator: Emeritus Corporation
0000 Xxxxxxx Xxxxxx,
Xxxxx 000
Xxxxxxx, Xxxxxxxxxx 00000
Telephone No. : (206) 298-
2909
Facsimile No.: (206) 301-
4500
Attn: President
To Lessee: Columbia House, LLC
0000 Xxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Telephone No.: (206) 298-
1201
Facsimile No. : (206) 301-
4545
Attn: Xxxx Xxxxxxxxxx
XI. RELATIONSHIP OF THE PARTIES: The
relationship of the parties shall be that of
Lessee and Independent Contractor and all acts
performed by Administrator during the term hereof
as Administrator of the Facility shall be deemed
to be performed in its capacity as an independent
contractor. Nothing contained in this Agreement is
intended to or shall be construed to give rise to
or create a partnership or joint venture or lease
between Lessee, its successors and assigns on the
one hand, and Administrator, its successors and
assigns on the other hand.
XII. INDEMNIFICATION: Administrator will not
be liable in the performance of its duties for any
loss incurred by or damage to the Lessee, unless
such loss or damage results from the negligence or
willful misconduct of Administrator. Administrator
shall indemnify, defend and hold harmless Lessee
from any loss or damage resulting from the acts or
omissions of Administrator's officers, agents or
employees in connection with the operation of the
Facility by Administrator. Lessee shall indemnify,
defend and hold Administrator harmless from any
loss incurred by or damage to Administrator where
such loss or damage result from the negligence or
willful misconduct of Lessee in performing its
obligations under the Agreement.
XIII. ENTIRE AGREEMENT: This Agreement
contains the entire agreement between the parties
and shall be binding upon and inure to the benefit
of their successors and assigns, and shall be
construed in accordance with the laws of the State
of Washington. This Agreement may not be modified
or amended except by written instrument signed by
both of the parties hereto.
XIV. CAPTIONS: The captions used herein are
for convenience of reference only and shall not be
construed in any manner to limit or modify any of
the terms hereof.
XV. ATTORNEY'S FEES: In the event either
party brings an action to enforce this Agreement,
the prevailing party in such action shall be
entitled to recover from the other all costs
incurred in connection therewith, including
reasonable attorney's fees.
XVI. SEVERABILITY: In the event one or more
of the provisions contained in this Agreement is
deemed to be invalid, illegal or unenforceable in
any respect under applicable law, the validity,
legality and enforceability of the remaining
provisions hereof shall not in any way be impaired
thereby.
XVII. CUMULATIVE; NO WAIVER: A right or
remedy herein conferred upon or reserved to either
of the parties hereto is intended to be exclusive
of any other right or remedy, and each and every
right and remedy shall be cumulative and in
addition to any other right or remedy given
hereunder, or now or hereafter legally existing
upon the occurrence of an Event of Default
hereunder. The failure of either party hereto to
insist at any time upon the strict observance or
performance of any of the provisions of this
Agreement or to exercise any right or remedy as
provided in this Agreement shall not impair any
such right or remedy or be construed as a waiver
or relinquishment thereof with respect to
subsequent defaults. Every right and remedy given
by this Agreement to the parties hereof may be
exercised from time to time and as often as may be
deemed expedient by the parties thereto, as the
case may be.
XVIII. AUTHORIZATION FOR AGREEMENT: The
execution and performance of this Agreement by
Lessee and Administrator have been duly authorized
by all necessary laws, resolutions or corporate
action, and this Agreement constitutes the valid
and enforceable obligations of Lessee and
Administrator in accordance with its terms.
XIX. COUNTERPARTS: This Agreement may be
executed in any number of counterparts, each of
which shall be an original, and each such
counterpart shall together constitute but one and
the same Agreement.
[SIGNATURE PAGE FOLLOWS.]
IN WITNESS WHEREOF, the parties have hereto
caused this Agreement to be duly executed, as of
the day and year first above written.
COLUMBIA HOUSE, LLC,
a Washington limited liability
company
By: /s/ Xxxx Xxxx
-
--------------------------------
Its:
Managing Member
By: Xxxx Xxxx
Its: Managing Member
EMERITUS CORPORATION,
a Washington corporation
/s/ Xxxxxxx X. Xxxxxxxxxx
--------
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By:
Xxxxxxx X. Xxxxxxxxxx
Its:
President
