EXHIBIT 10.29
LONG TERM CARE FACILITY
MANAGEMENT AGREEMENT
(River Oaks)
THIS MANAGEMENT AGREEMENT (the "Agreement") made as of the 1st day of
April, 1993, by and between International Health Care Properties XX, L.P., a
Georgia limited partnership ("Owner"), and WelCare International Management
Corporation, a Georgia corporation
("WelCare").
W I T N E S S E T H :
WHEREAS, the Owner presently owns certain real and personal property
comprising a certain 120 bed nursing center located in Tarrant County, Texas
(the "Facility"); and
WHEREAS, the Owner desires to retain WelCare under the terms of this
Agreement to provide its experience, skill and supervision to operate the
Facility on behalf of Owner; and
WHEREAS, WelCare desires to perform the management services on behalf of
Owner under and subject to the terms of this Agreement.
NOW, THEREFORE, in consideration of the premises and mutual promises and
covenants of the parties contained herein and for such other good and valuable
consideration, the receipt, adequacy and sufficiency of which is hereby
acknowledged, the parties hereby agree as follows:
ARTICLE I
MANAGEMENT DUTIES AND OBLIGATIONS
1.01 Control Retained by Owner. Owner shall at all times exercise overall
control over the assets and operations of the Facility, and WelCare shall
perform the duties herein required to be performed by it as the agent of Owner
and in accordance with the policies and directives from time to time adopted by
Owner.
1.02 Changes in Method of Operation. WelCare shall make substantial
changes in the method of operating the Facility only after timely notification
to and approval from Owner.
1.03 Management of Facility. During the term of this Agreement, WelCare
shall on behalf of Owner manage all aspects of the operation of the Facility,
including, but not limited to staffing, accounting, billing, collections,
setting of rates and charges and general administration. In connection
therewith, WelCare (either directly or through supervision of employees of the
Facility) shall:
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(a) Hire on behalf of Owner and retain (to the extent such personnel
are reasonably available in the community in which the Facility is located) an
adequate staff of nurses, technicians, nurse aides, office and other employees,
including a qualified administrator (the "Administrator") and shall promote,
direct, assign and discharge all such employees on behalf of Owner at WelCare's
sole discretion. All employees shall be employees of the Owner and carried on
the payroll of the Facility and shall not be deemed employees or agents of
WelCare.
(b) Institute and amend, from time to time general salary scales,
personnel policies and appropriate employee benefits for all employees on behalf
of Owner. Employee benefits may include pension and profit sharing plans,
insurance benefits, incentive plans for key employees and holiday, vacation,
personal leave and sick leave policies.
(c) Issue appropriate bills for services and materials furnished by
the Facility and use its best efforts to collect accounts receivable and monies
owed to the Facility, design and maintain accounting, billing, patient and
collection records; and prepare and file insurance, Medicare, Medicaid and any
and all other necessary or desirable reports and claims related to revenue
production. Owner hereby grants WelCare the right to enforce Owner's rights as
creditor under any contract or in connection with rendering any services for
purposes of collecting accounts receivable and monies owed the Facility.
(d) Order, supervise and conduct a program of regular maintenance
and repair, except that physical improvements costing more than $3,000 shall be
subject to approval of Owner.
(e) Purchase food, beverage, medical, cleaning and other supplies,
equipment, furniture and furnishings for the account of Owner, except that the
purchase of any single item which costs more than $3,000 shall be subject to
approval to Owner.
(f) Administer, supervise and schedule all patient and other
services of the Facility, including the operation of food, ▇▇▇▇▇▇/beautician and
other ancillary services.
(g) Provide for the orderly payment (to the extent funds of Owner
are available therefor) of accounts payable, employee payroll, amounts due on
short and long-term indebtedness, taxes, insurance premiums, and all other
obligations of the Facility.
(h) Institute standards and procedures for admitting patients, for
charging patients for services, and for collecting the charges from the patients
or third parties.
(i) Obtain and maintain insurance coverage for the Facility naming
Owner, WelCare and such other persons requested by Owner as insureds as provided
in Section 4.01 hereof.
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(j) Negotiate and enter into, in the name of and on behalf of Owner,
such agreements, contracts and orders as WelCare may deem necessary or
advisable, for the furnishing of services, concessions and supplies for the
operation and maintenance of the Facility.
(k) Negotiate on behalf of Owner (and in conjunction with Owner's
counsel) with any labor union lawfully entitled to represent employees of Owner
who work at the Facility, but any collective bargaining agreement or labor
contract must be submitted to Owner for its approval and execution.
(1) Assist in maintaining all licenses and permits required for the
operation of the Facility, its contracts with third party payors and other
similar governmental and non-governmental agencies and intermediaries.
(m) Make periodic evaluations of the performances of all departments
of the Facility.
(n) Design, establish and maintain a suitable accounting system
using accounts and classifications consistent with those used in similar
facilities.
(o) Advise and assist Owner in designing an adequate and appropriate
public relations program.
1.04 Reports to Owner.
(a) WelCare shall prepare and deliver to Owner, within thirty (30)
days after the close of each calendar month, unaudited financial statements
covering the prior month and containing a balance sheet and statement of income
in reasonable detail. WelCare shall also provide any required assistance to the
independent accountants for the Facility, who shall be selected by WelCare and
approved by Owner, in the preparation of unaudited (or audited if so requested
by Owner) financial statements for the operation of the Facility. Such financial
statements shall be prepared at Owner's expense in accordance with generally
accepted accounting principles in the health care field consistently applied and
delivered to WelCare and Owner promptly after the end of each fiscal year of the
Facility.
(b) WelCare shall submit to Owner each twelve (12) months a proposed
budget for the operation of the Facility setting out anticipated income,
expenses and capital expenditures during the succeeding twelve (12) month
period, and shall use its best efforts to operate the Facility in accordance
with the provisions of the budget for the Facility submitted to and approved by
Owner. Such proposed budget for the Facility shall be delivered to Owner no
later than thirty (30) days prior to the commencement of the operational fiscal
year of the Facility.
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(c) WelCare shall schedule periodic management meetings to be
attended by representatives of both WelCare and Owner no less frequently than
semi-annually and shall furnish to Owner quarterly written progress reports
concerning the operation of the Facility.
1.05 Bank Accounts and Working Capital. WelCare, in the Facility's name
and on behalf of Owner, shall deposit in a bank account or accounts of the
Facility (the "Operating Accounts") established in Owner's name all funds
received from the operations of the Facility. Owner shall provide sufficient
working capital for the operation of the Facility and shall make deposits in the
Operating Account of such working capital from time to time upon the request of
WelCare. All costs and expenses incurred in the operation of the Facility shall
be paid out of the Operating Accounts. WelCare shall specify with the approval
of the Owner the signatory or signatories required on all checks or other
documents of withdrawal for the Operating Accounts.
1.06 Access to Books, Records and Documents. If it is ultimately
determined that Section 952 of the Omnibus Reconciliation Act of 1980 and final
regulations promulgated thereunder apply to this Agreement:
(a) Until the expiration of four years after the furnishing of
services pursuant to this Agreement, WelCare shall, as provided in Section 952,
make available, upon written request, to the Secretary of Health and Human
Services, or upon request, to the Comptroller General of the United States, or
any of their duly authorized representatives, this Agreement, and all books,
documents and records of WelCare that are necessary to verify the nature of this
Agreement for which payment may be made under the Medicare program; and
(b) If WelCare carries out any of the duties of this Agreement
pursuant to a subcontract or subcontracts with an aggregate value or cost of
$10,000 or more over a twelve (12) month period with a related organization,
such subcontract or subcontracts shall contain a clause to the effect that,
until the expiration of four years after the furnishing of such services
pursuant to such subcontract or subcontracts, the related organization shall, as
provided in Section 952, make available, upon written request, to the Secretary
of Health and Human Services, or upon request, to the Comptroller General of the
Untied States, or any of their duly authorized representatives, the subcontract
or subcontracts, and all books, documents and records of such subcontractors for
which payment may be made under the Medicare program.
1.07 Licenses.
(a) WelCare shall, on behalf of Owner, use its reasonable best
efforts to apply for, obtain and maintain all necessary licenses, permits,
consents, and approvals from all
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governmental agencies which have jurisdiction over the operation of
the Facility.
(b) Neither Owner not WelCare shall knowingly take any action or
fail to take any action which may (1) cause any governmental authority having
jurisdiction over the operation of the Facility to institute any proceeding for
the rescission or revocation of any necessary license, permit, consent or
approval, or (2) adversely affect Owner's right to accept and obtain payments
under Medicare, Medicaid, or any other public or private third party medical
payment program.
(c) WelCare shall, with the written approval of Owner, have the
right to contest by appropriate legal proceedings, diligently conducted in good
faith in the name of Owner, the validity or application of any law, ordinance,
rule, ruling, regulation, order or requirement of any governmental agency having
jurisdiction over the operation of the Facility. Owner, after having given its
written approval, shall pay attorneys' fees incurred with regard to the contest.
Counsel for any such contest shall be selected by WelCare and approved by Owner.
WelCare shall have the right, without the written consent of the Owner, to
process all third-party claims for the services of the Facility, including,
without limitation, the full right to contest to the exhaustion of all
applicable administrative proceedings or procedures, adjustment and denials by
governmental agencies or their fiscal intermediaries as third-party payors.
1.08 Administrator. WelCare shall employ for the Facility an Administrator
reasonably acceptable to Owner, to serve as the chief executive officer of such
Facility. The Administrator shall be an employee of and shall be compensated by
Owner and Owner shall pay, in advance, on or before the fifth (5th) day of each
month all compensation, including salary, fringe benefits, bonuses and business
expense reimbursements approved by WelCare, payable to the Administrator. The
term "fringe benefits" shall include, without limitation, employer's F.I.C.A.
payments, unemployment compensation and other employment taxes, bonuses,
vacation, personal and sick leave benefits, workers' compensation, group life,
health and accident insurance premiums and disability and other benefits.
1.09 Taxes. Any federal, state or local taxes, assessments or other
governmental charges properly imposed on the Facility are the obligations of the
Owner, not of WelCare, and shall be paid out of the Operating Accounts of the
Facility. With the Owner's prior written consent, WelCare may contest the
validity or amount of any such tax or imposition on the Facility in the same
manner as described in Section 1.07(c) hereof.
1.10 Use of WelCare's Personnel. An authorized representative of WelCare
shall visit the Facility as often as ▇▇▇▇▇▇▇ ▇▇▇▇▇ necessary. The time spent by
such authorized representative of WelCare during such visits and all
out-of-pocket expenses arising
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from travel and lodging connected with such visitations shall not be charged
separately to Owner.
1.11 Government Regulations. WelCare agrees to operate and maintain the
Facility in substantial compliance with the requirements of any statute,
ordinance, law, rule, regulation or order of any governmental or regulatory body
having jurisdiction over the Facility and to comply with all orders and
requirements of the local board of fire underwriters or any other body which may
exercise similar functions; provided, however, that WelCare shall not be
required to expend any funds in order to comply with any such statutes,
ordinances, laws, rules, regulations or orders and to the extent any funds are
so required; it shall fulfill its obligations hereunder by notifying Owner of
the actions necessary in order to be in compliance therewith.
1.12 Quality Controls. WelCare shall activate and maintain on a continuing
basis a "Quality Assurance Program" in order to provide objective measurements
of the quality of health care provided at the Facility and, in connection
therewith, shall utilize such techniques as patient questionnaires and
interviews, physician questionnaires and interviews, and inspections.
1.13 Staff Specialists. In addition to the other managerial services
provided for herein, WelCare shall make available to the Facility, for
consultation and advice, when necessary, specialists in such fields as
accounting, auditing, budgeting, dietary services, environmental control,
management, maintenance, nursing, personnel, pharmacy operations, public
relations, purchasing, quality assurance, systems and procedures, and
third-party reimbursement.
1.14 Performance of Services by WelCare. In the performance of its
services hereunder, WelCare shall exercise the same standards and degree of care
used by reasonable and prudent managers of nursing homes of similar size, nature
and character as the Facility. Notwithstanding anything herein to the contrary,
WelCare shall not be deemed in violation of this Agreement if WelCare is
prevented from performing any of its obligations hereunder for any reason beyond
its reasonable control including, without limitation, strikes, walkouts or other
employee disturbances, acts of God, or the action or promulgation of any
statute, rule, regulation or order by any federal, state, or local governmental
or judicial agency or official, nor shall it be deemed in default hereunder or
otherwise liable for any error of judgment or act or omission in the performance
of its services hereunder, which is made in good faith, except for its wilful
default or gross negligence.
1.15 Extraordinary Services. Owner agrees that any extraordinary or
specialized service recommended by WelCare and approved by Owner, even if
provided by WelCare, may be performed
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for a separate fee as agreed upon by WelCare and Owner in advance
of the performance of such service.
ARTICLE II
TERM AND TERMINATION
2.01 Term. The term of this Agreement shall commence on the date of this
Agreement and, unless sooner terminated as provided herein, shall extend for
twenty (20) years.
2.02 Option to Extend Term. WelCare shall have the option to extend the
term of this Agreement for two (2) additional periods of ten (10) years each, by
giving written notice to Owner of WelCare's exercise of such right and option
not later than three (3) months prior to the end of the original term hereof or
the term hereof as previously extended. Each and all of the provisions of this
Agreement shall apply during the extended term(s) of this Agreement.
2.03 Termination for Cause.
(a) If either party shall apply for or consent to the appointment of
a receiver, trustee or liquidator of such party or all or a substantial part of
its assets, file a voluntary petition in bankruptcy, make a general assignment
for the benefit of creditors, file a petition or an answer seeking
reorganization or arrangement with creditors or take advantage of any insolvency
law, or if an order, judgment or decree shall be entered by any court of
competent jurisdiction, on the application of a creditor, adjudicating such
party bankrupt or insolvent or approving a petition seeking reorganization of
such party or appointing a receiver, trustee or liquidator for such party or all
or a substantial part of its assets, and such order judgment or decree shall
continue unstayed and in effect for any period of ninety (90) consecutive days,
then, in case of any such event, the term of this Agreement shall expire, at the
other party's option, upon five (5) days written notice.
(b) If Owner or WelCare shall fail to keep, observe or perform any
material covenant, agreement, term or provision of this Agreement to be kept,
observed, or performed by such party, and such default shall continue for a
period of thirty (30) days, (or ten (10) days in the case of a failure to pay
any amounts due WelCare under this Agreement) after notice thereof by one party
to the other, then, in case of any such event and upon the expiration of any
period of grace applicable thereto, the term of this Agreement shall expire, at
the option of the nondefaulting party, upon five (5) days written notice to the
other party. Such termination shall be without prejudice to WelCare's right to
receive management fees under Article III hereof through the end of the month in
which such termination becomes effective.
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2.04 Optional Termination.
(a) Either party has the option to terminate this Agreement, without
damage or penalty, upon ten (10) days prior written notice to the other, upon
the occurrence of either of the following events:
(i) The Facility or any material portion thereof is damaged
or destroyed to the extent that in the written opinion of an independent
architect or engineer reasonably acceptable to both parties (x) it is not
practicable or desirable to rebuild, repair or restore the Facility within
a period of six (6) months to its condition immediately preceding such
damage, or (y) the conducting of normal operations of the Facility would
be prevented for a period of six (6) months or more; or
(ii) Title to or the temporary use of all or substantially all
the Facility is taken under the exercise of the power of eminent domain by
any governmental authority or person, firm or corporation acting under
governmental authority which in the opinion of an independent architect or
engineer reasonably acceptable to both parties prevents or is likely to
prevent the conducting of normal operations at the Facility for a period
of at least six (6) months.
Provided, however, that in either of such events, if Owner or any
affiliate thereof rebuilds, restores or otherwise rearranges the Facility and
recommences operations thereof, Owner shall give WelCare the first option to
manage the Facility under the same terms, conditions, and fees as provided
herein.
(b) WelCare shall have the option to terminate this Agreement
without damage or penalty upon ten (10) days prior written notice to the Owner
following the sale, transfer, assignment, or other disposition, in whole or in
part, by the Owner of its interest in the Facility. In the event Owner is a
corporation, any dissolution, merger, consolidation or other transfer of a
substantial portion of the stock of Owner shall constitute an assignment of the
Facility for all purposes of this Section 2.05(b). The term "substantial
portion" means the ownership of stock possessing, and of the right of exercise,
at least fifty percent (50%) of the total combined voting power of all classes
of stock of such corporation, issued, outstanding and entitled to vote for the
election of directors whether such ownership is direct ownership, or indirect
ownership through ownership of stock possessing, and of the right to exercise,
at least fifty percent (50%) of the total combined voting power of all classes
of stock of another corporation or corporations; provided, however, that this
prohibition on stock transfer shall not apply to a "publicly traded
corporation," which term is hereby defined for all purposes under this Agreement
as a corporation whose shares of
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stock have been registered pursuant to the Securities Exchange Act of 1933, as
amended, the Securities Act of 1934, as amended, or the state securities laws
pursuant to an exemption from the aforementioned statutes.
2.05 Status of Employees After Termination. During the two (2) year period
commencing on the date of termination or expiration of the term of this
Agreement, neither Owner nor any of its affiliates shall hire or attempt to hire
any employees of WelCare or any of its affiliates, without the prior written
approval of WelCare; provided, however, that Owner shall not be prevented from
re-employing persons working at the Facility who were employed by the Owner on
the date of such termination or expiration.
ARTICLE III
MANAGEMENT FEE
3.01 Management Fee. Effective as of the date of this Agreement and for
the remainder of the term, WelCare shall receive from Owner, and Owner shall pay
to WelCare, each month during the term hereof, as the amount due for services, a
management fee equal to six percent (6%) of the Gross Revenues of the Facility.
"Gross Revenues" shall mean, for the Facility, total revenues of such Facility,
including, without limitation, all ancillary fees, charges, rentals and other
revenue derived in any way from the operation of such Facility, on an accrual
basis, after deduction of allowances for contractual adjustments as they relate
to third-party payors and before deduction of any and all expenses.
3.02 Payment of Management Fees. On or before the tenth (10th) day of each
month during the term hereof, Owner shall be obligated to pay WelCare an
estimated management fee, calculated in accordance with Section 3.01 hereof,
based on the estimated Gross Revenues of the Facility during the current month.
All management fees due hereunder shall be withdrawn from the Operating Accounts
and paid to WelCare. Any late payments of management fees not made after three
(3) days written notice to Owner shall bear interest equal to the Advance Rate
(as defined in Section 5.11 hereof) from their original due date until fully
paid.
3.03 Adjustment. Within fifteen (15) days after the delivery of the annual
financial statements of the Facility, Owner shall pay to Manager or Manager
shall pay to Owner such amount as is necessary to make the amount of the
management fees paid with respect to the year to which the financial statements
relate equal to the amount of management fees shown to be due by the annual
audit.
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ARTICLE IV
COVENANTS OF OWNER
4.01 Insurance. WelCare shall provide and maintain, on behalf of Owner and
at Owner's expense, throughout the term of this Agreement, insurance with
responsible companies naming Owner and WelCare (as their respective interests
may appear) as insureds in the minimum amounts and covering the risks described
below:
(a) Comprehensive public liability insurance, including personal
injury or death and property damage in the combined single limit of not less
than $500,000.00;
(b) Workmen's compensation, employers' liability or similar
insurance as may be required by law;
(c) Insurance against loss or damage to the Facility from fire,
lightning and such other risks and casualties now or thereafter covered by the
uniform standard form of extended coverage insurance endorsement then in use in
the State of Texas and against loss or damage with respect to all boilers and
pressure vessels and pressure pipes, if any, installed in the Facility and, if
the Facility is located within a 100 year flood plain designated by the Untied
States Army Corps of Engineers, against loss or damage due to floods to be
maintained under the National Flood Insurance Program or under comparable
commercial insurance programs; all such policies being in an amount not less
than ninety percent (90%) of the actual replacement cost of the Facility as
determined every two (2) years by the Owner;
(d) Professional liability insurance against claims for bodily
injury or death or otherwise arising out of the operations of the Facility, such
insurance to afford minimum protection of not less than $500,000.00 with respect
to bodily injury or death to any one person;
(e) Automobile liability insurance covering owned, hired and
non-owned vehicles, such insurance to afford minimum protection of not less than
$500,000.00 for bodily injury or death to any one person in any one accident
(subject to a maximum recovery by all persons in any one accident of
$500,000.00) and $50,000.00 for damage to property (including loss of the use
thereof) in any one accident;
(f) Business interruption insurance in an amount sufficient to cover
the estimated management fees payable hereunder and all other fixed expenses of
the Facility for a period of not less than six (6) months;
(g) Employee fidelity bond or insurance, including comprehensive
coverage for dishonesty, disappearance and discrepancy for all employees of
Owner; and
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(h) Such other insurance or additional insurance as both WelCare and
Owner shall reasonably deem necessary for protection against claims, liabilities
and losses arising from the operation or Ownership of the Facility.
The insurance specified above for the Facility may be provided by any
combination of underlying and umbrella policies, which policies may also cover
other facilities owned, leased or managed by WelCare or its affiliates. No
policy shall have deductible provisions in excess of $10,000.00, plus, if an
umbrella policy, the amount of the underlying policy.
4.02 Licensing; Changes and Services. Owner agrees to take or cause to be
taken any and all actions necessary to be taken by it as the overall supervisor
of the assets and operations of the Facility in order to maintain all required
licenses, permits for the operation of the Facility and the Facility's
eligibility to participate in all public or private third-party medical payment
programs, including providing sufficient funds to bring the Facility in
compliance with all applicable fire safety codes and other laws, regulations and
orders, and to correct all structural, maintenance, procedural and staffing
deficiencies as shown on the surveys and reports of governmental agencies having
jurisdiction over the Facility. Owner agrees that it will not, through the
exercise of its overall supervisory powers, substantially change the services
rendered by the Facility during the term hereof without the prior written
approval of WelCare.
Nothing contained in this Section 4.02 shall affect the duties and
obligations of WelCare with regard to the applying for, obtaining and
maintaining all necessary governmental licenses, permits, consents and approvals
set forth in Section 1.07 hereof.
4.03 Transfer of Ownership. Owner further acknowledges and agrees that
upon the transfer, lease, assignment, sale or other disposition or conveyance of
all or any part of its ownership of the Facility, this Agreement shall remain in
full force and effect unless otherwise terminated as provided in Section
2.04(b). Owner covenants and agrees that in the event that it sells, assigns or
otherwise transfers its ownership of the Facility at any time while this
Agreement is in effect, it will require the transferee to assume the obligations
of the Owner hereunder.
4.04 Damage or Destruction. If the Facility or any portions thereof shall
be damaged or destroyed by fire or other casualty, Owner shall commence to
repair, restore, rebuild or replace any such damage or destruction within sixty
(60) days after such fire or other casualty and shall proceed with due diligence
to complete such work within a reasonable period of time.
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ARTICLE V
MISCELLANEOUS COVENANTS
5.01 Assignment. Owner shall not assign its rights and/or obligations
under this Agreement without the prior written consent of WelCare, except to
Owner's construction or permanent lender, in the event of foreclosure of such
lender's mortgage against the Facility; provided, however, that such lender or
lenders shall first agree in writing to assume and be bound by Owner's
obligations hereunder. WelCare shall not assign its rights and/or obligations
under this Agreement, except to an affiliate of WelCare, without prior written
consent of Owner.
5.02 Binding Agreement. The terms, covenants, conditions, provisions and
agreements herein contained shall be binding upon and inure to the benefit of
the parties hereto, their successors and assigns.
5.03 Relationship of Parties. Nothing contained in this Agreement shall
constitute or be construed to be or to create a partnership, joint venture or
lease between Owner and WelCare with respect to the Facility.
5.04 Notices. All notices, demands and requests contemplated hereunder by
either party to the other shall be in writing, and shall be delivered by hand,
transmitted by cable, telegram or telecopy (receipt confirmed), or mailed,
postage prepaid, registered, or certified mail return receipt requested:
(a) to Owner, by addressing the same to:
International Health Care Properties XX, L.P.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇
(b) to WelCare, by addressing the same to:
WelCare International Management Corporation
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Mr. J. ▇▇▇▇▇▇▇ ▇▇▇▇▇, President
or to such other address or to such other person as may be designated by notice
given from time to time during the term of this Agreement by one party to the
other. Any notice hereunder shall be deemed given five (5) days after mailing,
if given by mailing in the manner provided above, or on the date delivered or
transmitted if given by hand, cable, telegraph or telecopy (receipt confirmed).
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5.05 Entire Agreement; Amendments. The Agreement contains the entire
agreement between the parties hereto, and no prior oral or written, and no
contemporaneous oral representations or agreements between the parties with
respect to the subject matter of this Agreement shall be of any force and
effect. Any additions, amendments or modifications to this Agreement shall be of
no force and effect unless in writing and signed by both Owner and WelCare.
5.06 Governing Law. This Agreement has been executed and delivered in the
State of Texas, and all the terms and provisions hereof and the rights and
obligations of the parties hereto shall be governed by, and construed and
enforced in accordance with, the laws of the State of Georgia (without regard to
its rules of conflicts of laws).
5.07 Captions and Headings. The captions and headings throughout this
Agreement are for convenience and reference only and do not constitute a part
hereof.
5.08 Disclaimer of Employment of Facility Employees. No person employed in
the operation of the Facility will be an employee of WelCare, and WelCare will
have no liability for payment of their wages, fringe benefits, payroll taxes and
other expenses of employment.
5.09 Costs and Expenses; Indemnity. All fees, costs and expenses arising
out of, relating to or incurred in the operation of the Facility, including,
without limitation, the fees, costs, and expenses of outside consultants and
professionals, shall be the sole responsibility of Owner. WelCare, by reason of
the execution of this Agreement or the performance of its services hereunder,
shall not be liable for or deemed to have assumed any liability for such fees,
costs and expenses, or any other liability or debt of Owner whatsoever, arising
out of or relating to the Facility or incurred at its operation, except the
salary of WelCare's employees and the expenses and costs incurred at its central
administrative offices in performance of its obligations hereunder. Owner agrees
to indemnify and hold WelCare and its officers, directors, agents and employees
harmless from and against all losses, claims, damages or other liabilities,
including the costs and expenses incurred in connection therewith, arising out
of or relating to the ownership of the Facility (except those resulting from the
wilful misconduct or gross negligence of WelCare), including, without
limitation, any liability asserted against WelCare or any of its officers,
directors, employees or agents by reason of any action taken by any of the
foregoing while performing the duties of WelCare hereunder on behalf of Owner.
5.10 Responsibility for Misconduct of Employees and Other Persons. WelCare
will have no liability whatsoever for damages suffered on account of the
dishonesty, misconduct or negligence of any employee of the Facility or any
officer, director, partner, stockholder, employee or agent of Owner. WelCare
shall be liable
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to the Facility in connection with damage or loss directly sustained by Owner by
reason of the dishonesty, wilful misconduct and gross negligence of WelCare's
employees in the operation of the Facility during the term of the Agreement.
5.11 Advances by WelCare. WelCare shall have the right, but not the
obligation, to advance to Owner any and all sums required to maintain all
necessary licenses and permits and to otherwise keep the Facility operating as a
fully insured nursing home in good condition and repair. All such sums advanced
by WelCare to Owner shall be repaid by Owner, with interest commencing on the
date such sums were advanced at a rate equal to the announced prime rate of
interest of Chase Manhattan Bank, N.A., New York, New York, plus two percent
(2%) per annum ("Advance Rate"), immediately upon written notice thereof to
Owner, and WelCare shall have the right at any time and from time to time to
instruct the signatories of the Operating Accounts to withdraw and pay to
WelCare amounts necessary in order to repay such advances.
5.12 Definition of Affiliate. For purposes of this Agreement, the term
"affiliate" shall mean any person or entity which WelCare or Owner or its
general partners, or its partners and their respective stockholders or
individual partners, directly or indirectly, through one or more intermediaries,
controls, is in common control with, or is controlled by.
5.13 Authorization of Agreement. WelCare and Owner represent and warrant,
each to the other with respect to itself, that the execution and delivery of
this Agreement has been duly authorized by all respective action, will not
presently or with the passage of time, the giving of notice, or both result in a
default under or violate or conflict with (i) the provisions of the partnership
agreement or articles of incorporation and bylaws, as the case may be, of
WelCare or Owner, or (ii) any other agreement, mortgage, loan agreement or other
contract or instrument by which either party is bound or to which any of their
property or assets is subject, or (iii) any existing law, regulation, court
order or consent decree by which either party is bound or to which any of their
property or assets are subject.
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IN WITNESS WHEREOF, the parties hereto have executed, sealed and delivered
this Agreement through their duly authorized representatives, as of the day and
year first above written.
WELCARE INTERNATIONAL MANAGEMENT
CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇
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▇▇▇▇ ▇. ▇▇▇▇, Vice President
INTERNATIONAL HEALTH CARE
PROPERTIES XX, L.P.
By: International Health Care
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Associates XX, Inc.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇,
Executive Vice President
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SCHEDULE 10.29
CHMC has entered into an agreement substantially identical to Exhibit
10.29 as follows:
1. Long Term Care Facility Management Agreement dated May 31, 1991 with
International Health Care Properties IX, L.P. for Roscommon County, Michigan
facility. A material detail in which this agreement differs from Exhibit 10.29
is that this agreement terminates on May 31, 2011.
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