ASSIGNMENT AGREEMENT
(Raynham, Massachusetts)
THIS ASSIGNMENT AGREEMENT (the "Agreement") is entered into as of the 6th
day of June, 1996, by and between Continuum Care of Massachusetts, Inc.
("Assignor") and CareMatrix of Massachusetts, Inc. ("Assignee").
WITNESSETH:
WHEREAS, Continuum Care Corporation (predecessor in interest to Assignor)
and Raynham Medical Investors Limited Partnership entered into a certain Turnkey
Construction Contract dated as of March 3, 1994 for the construction of a one
hundred forty-two (142) bed (which may be increased to one hundred fifty-four
(154) beds) long term care facility to be located on South Street, East, in
Raynham, Massachusetts (the "Turnkey Construction Agreement"), a copy of which
is attached hereto as Exhibit A.
WHEREAS, Assignor desires to assign its rights and obligations under the
Turnkey Construction Agreement to Assignee and Assignee desires to assume such
rights and obligations.
NOW THEREFORE, for and in consideration of the sum of Ten Dollars ($10.00)
and other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, Assignor and Assignee hereby agree as follows:
1. Assignor hereby grants, bargains, sells, assigns and transfers to
Assignee all of Assignor's right, title and interest in and all contractual and
other rights under the Turnkey Construction Agreement.
2. Assignee hereby accepts this assignment and hereby agrees to assume all
of Assignor's right, title, interest, duties and obligations under the Turnkey
Construction Agreement.
3. This Agreement may be executed by facsimile and in counterparts, each of
which shall constitute an original document.
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as
of the day and year first above written.
ASSIGNOR:
CONTINUUM CARE OF
MASSACHUSETTS INC.
By: /s/ Xxxxx X. Xxxxx
-------------------------
Name: Xxxxx X. Xxxxx
Title:
ASSIGNEE:
CAREMATRIX OF
MASSACHUSETTS, INC.
By: /s/ Xxxxx X. Xxxxx
-------------------------
Name: Xxxxx X. Xxxxx
Title:
EXHIBIT A
TURNKEY CONSTRUCTION CONTRACT
Between
CONTINUUM CARE CORPORATION
And
RAYNHAM MEDICAL INVESTORS LIMITED PARTNERSHIP
Table of Contents
For
Turnkey Construction Contract
Between
CONTINUUM CARE CORPORATION
And
RAYNHAM MEDICAL INVESTORS LIMITED PARTNERSHIP
ARTICLE I - Status of Facility
Section 1.1 - Title to Premises
Section 1.2 - Encumbrances
Section 1.3 - Permits and Approvals
Section 1.4 - Documentation
Section 1.5 - Representations of Contractor
Section 1.6 - Representations of Owner
Section 1.7 - Other Agreements
Section 1.8 - Opinions of Counsel
ARTICLE II - Construction of the Facility
Section 2.1 - Architect
Section 2.2 - Other Professionals
Section 2.3 - Failure to Approve Final Plans
Section 2.4 - Construction
Section 2.5 - Personal Property
Section 2.6 - Changes
Section 2.7 - Commencement of Construction
Section 2.8 - Continuity of Construction
Section 2.9 - Completion of Construction
Section 2.10 - Punch-List
Section 2.11 - Work and Warranties
Section 2.12 - Subcontractors
Section 2.13 - Right of Owner to Cure
Section 2.14 - Termination by Owner
ARTICLE III - Financial
Section 3.1 - Construction/Permanent Financing
Section 3.2 - Price Increase Loan
ARTICLE IV - Closing
Section 4.1 - Date of Closing
Section 4.2 - Contract Price
Section 4.3 - Payment of Contract Price
Section 4.4 - Documents to be delivered by Contractor at Closing
Section 4.5 - Documents to be delivered by Owner at Closing
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ARTICLE V - Additional Responsibilities of Parties
Section 5.1 - Contractor's Responsibilities
Section 5.2 - Owner's Responsibilities
Section 5.3 - Indemnification
ARTICLE VI - Contingencies
Section 6.1 - Required Occurrences
Section 6.2 - Fai1ure of Contingencies
Section 6.3 - Default
ARTICLE VII - Concluding Provisions
Section 7.1 - Entire Agreement
Section 7.2 - Representations
Section 7.3 - Amendments
Section 7.4 - Joint Effort
Section 7.3 - No Brokers
Section 7.6 - Assignment
Section 7.7 - Notices
Section 7.8 - Arbitration
Section 7.9 - Captions
Section 7.10 - Successors
Section 7.11 - Counterparts
Section 7.12 - Severability
Section 7.13 - Effective Date
Section 7.14 - No offer
Section 7.15 - Governing Law
Section 7.16 - Survival
Section 7.17 - Compliance with Loan Documents
EXHIBIT LIST
Exhibit "A" - Description of Premises
Exhibit "B" - Survey
Exhibit "C" - Title Commitment
Exhibit "D" - Determination of Need, Approval of
Transfer and DPH Plan Approval
Exhibit "E" - Final Plans
Exhibit "F" - Group III Items
Exhibit "G" - FFE
Exhibit "H" - Form of Assignment of Lender Deposit Pledge
Exhibit "I" - MCE Line Items
Exhibit "J" - Contractor Indemnification
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TURNKEY CONSTRUCTION CONTRACT
This Turnkey Construction Contract ("Agreement") is between CONTINUUM CARE
CORPORATION, a Delaware corporation (the "Contractor") with an office at River
Place, 00 Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx 00000 and RAYNHAM MEDICAL
INVESTORS LIMITED PARTNERSHIP, a Tennessee limited partnership (the "Owner")
with an office at 0000 Xxxxx Xxxxxx, X.X., Xxxxxxxxx, Xxxxxxxxx 00000-0000 and
is entered into for the purpose of reducing to a formal writing all of their
understandings with respect to the construction, financing and ownership of a
one hundred forty-two (142) bed (which may be increased to one hundred
fifty-four (154) beds) long term care facility (the "Facility") to be located on
certain property located on South Street East in Raynham, Massachusetts and more
particularly described on attached Exhibit "A" (the "Premises").
In consideration of the undertakings of each of the parties to the other,
IT IS AGREED:
ARTICLE I
Status of Facility
Section 1.1 - Title to Premises. The Contractor, or its affiliate
("Premises Owner"), holds fee simple title to the Premises described in Exhibit
"A" subject to the Existing Encumbrances (as hereinafter defined). Exhibit "A"
and each of the other Exhibits referred to in this Agreement shall be
incorporated into this Agreement by such reference as if fully set forth in this
Agreement. At the Closing, upon the satisfaction of the contingencies set forth
in Article VI and elsewhere in this Agreement, the Contractor shall convey or
cause the Premises Owner to convey fee simple title to the Premises, reasonably
satisfactory to the Owner and Owner's Lender ("Lender"), to the Owner subject to
the Existing Encumbrances, the physical conditions with respect to utilities,
rights of way, easements, landscaping and improvements which are disclosed by
the survey of the Premises, a copy of which is attached hereto as Exhibit "B"
("Survey"), as such conditions may change during the course of construction as
permitted or contemplated by this Agreement and the Final Plans (as defined
herein). Owner acknowledges that it has reviewed, inspected and approved the
location and general characteristics of the Premises.
Section 1.2 - Encumbrances. The Contractor has been provided with a
commitment for policy of title insurance from First American Title Insurance
Company (commitment number 50369113/20177249) to insure title to the Premises, a
copy of which is attached hereto as Exhibit "C". The encumbrances set forth as
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items 1 through 1l,inclusive, in Schedule B of such commitment are collectively
referred to herein as the "Existing Encumbrances". At the Closing, upon the
satisfaction of the contingencies set forth in Article VI and elsewhere in this
Agreement, the Owner shall purchase the Premises from the Contractor subject to
the Existing Encumbrances, the physical conditions with respect to utilities,
rights of way, easements, landscaping and improvements which are disclosed by
the Survey of the Premises, as such conditions may change during the course of
construction as permitted or contemplated by this Agreement and the Final Plans.
Section 1.3 - Permits and Approvals.
(a) If it has not already, Contractor shall make application for and use
its reasonable best efforts to obtain, on behalf of Owner, all necessary zoning,
land use, environmental and building permits, consents and approvals from the
appropriate state and local government agencies ("Land Use Approvals") which
will permit the construction and operation of the Facility on the Premises. All
of such Land Use Approvals shall be assigned to the Owner at the Closing (to the
extent assignable) and the Owner shall grant to the Contractor, at the Closing,
a license under the Land Use Approvals so that Contractor may perform its
obligations hereunder. Owner's obligations with respect to obtaining federal,
state and local government permits, consents and approvals for the Facility
shall be limited to promptly cooperating with the Contractor in every respect in
obtaining such permits, consents and approvals. Prior to Physical Completion,
the Contractor shall perform or cause to be performed all of the obligations
required of the owner of the Premises under the Land Use Approvals. Prior to
Physical Completion all indemnifications set forth in the Land Use Approvals and
all amounts due and payable under the Land Use Approvals as fees or charges
relating to the construction (as opposed to the operation) of the Facility, and
not as taxes or assessments, including, without limitation, all amounts
deposited or to be deposited into escrow with the issuer of any such Land Use
Approval shall be the obligation of the Contractor. The Contractor hereby
indemnifies the Owner for any loss incurred by the Owner because of the
Contractor's breach of the preceding sentence.
(b) Contractor has applied to the Department of Public Health of the
Commonwealth of Massachusetts ("DPH") and has received approval of the transfer
of both the Determination of Need for the Facility, No. 5-1162, a copy of which
is attached hereto as Exhibit "D" ("DON") and the Premises to the Owner.
(c) Contractor shall have the right, in its sole discretion, to increase
the number of beds in the Facility from one hundred forty-two (142) to one
hundred fifty-four (154) (the
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"Bed Increase"), which shall increase the Contract price by Eight Hundred
Thirty-five Thousand Eight Hundred Twenty-three Dollars ($835,823.00), subject
to the conditions set forth in this subparagraph. In the event that any expenses
incurred in such Bed Increase are not included in the computation of Owner's
reimbursable capital costs for the purpose of determining the Owner's per diem
rates for the Facility ("Non-Reimbursable Expenses"), the Contract price will be
reduced by the amount of such Non-Reimbursable Expenses. In the event that the
Bed Increase does not occur, for any reason, no consequence shall result to the
Contractor and the Contract price shall not be increased as a result.
Section 1.4 - Documentation.
(a) The Owner covenants that it will provide fully and in a timely fashion
all reasonable documentation required by Contractor, any governmental bodies or
any lenders, supporting Owner's representations, warranties and covenants
hereunder, supporting all applications for any necessary governmental permits,
consents and approvals, and supporting any applications for construction or
permanent financing. Such documentation nay include, but not be limited to,
financial statements of the Owner or its affiliate, as required by Contractor,
any governmental bodies or any lender, Owner's certificate of limited
partnership; all authorizations for the transactions contemplated by this
Agreement; and other information relevant to any such applications or requested
by any lender. The contractor covenants that it will provide fully and in a
timely fashion all reasonable documentation requested by Lender and all
reasonable documentation of Owner's costs required by governmental bodies in
connection with the development or construction of the Facility, including
without limitation, reasonable documentation of Owner's costs which may be
required by governmental bodies auditing the Facility.
(b) As used herein the term "Loan Documents" shall mean a Construction Loan
Agreement ("Loan Agreement"), a Mortgage and Security Agreement, a Collateral
Assignment of Permits, Licenses, Approvals and Contracts, a Collateral
Assignment of this Agreement, and a Deposit Pledge Agreement, all dated as of
the Closing Date, and each of which is by and between Owner and Lender.
Section 1.5 - Representations of Contractor. Contractor represents that it
is duly organized1 validly existing, and in good standing under the laws of the
State of Delaware. Contractor represents that it is empowered and authorized to
execute, deliver, and perform its obligations under this Agreement, and, upon
such execution and delivery of this Agreement, this Agreement shall be a valid,
binding, and legal obligation of the contractor, enforceable in accordance with
its terms and duly
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authorized by a vote of its Board of Directors in compliance with its
certificate of incorporation and bylaws and all applicable laws of the
Commonwealth of Massachusetts.
Section 1.6 - Representations of Owner. Owner represents that it is duly
organized and validly existing under the laws of the State Of Tennessee and duly
authorized to do business in Massachusetts. Owner represents that it is
empowered and authorized to execute, deliver, and perform its obligations under
this Agreement, and, upon such execution and delivery, this Agreement shall be a
valid, binding, and legal obligation of the Owner, enforceable in accordance
with its terms, in compliance with its certificate of limited partnership and
partnership agreement and all applicable laws of the State of Tennessee.
Section 1.7 - Other Agreements. The Contractor and Owner each represents
to the other that neither entering into this Agreement nor performing their
respective obligations hereunder will violate any other agreements or documents
by which it may be bound.
Section 1.8 - Opinions of Counse1. Contemporaneously with the execution of
this Agreement, Owner shall deliver to contractor an opinion of Owner's in-house
counsel, X. Xxxxx Day, Jr., Esq. with respect to the due organization, valid
existence and good standing of Owner, the power of the Owner to enter into this
Agreement and perform its obligations hereunder and the Owner shall deliver to
the Contractor an opinion of Hinckley1 Xxxxx, et al. as to the enforceability
of this Agreement, and a partnership resolution of the Owner authorizing the
transactions set forth herein, each in form and substance reasonably
satisfactory to Contractor. Contemporaneously with the execution of this
Agreement, Contractor shall deliver to Owner an opinion of Contractor's in-house
Counsel, Xxxxxxx X. Xxxx, Esq. or Xxxxxx X. Xxxxxx, Esq., with respect to the
due organization, valid existence and good standing of Contractor, the power of
Contractor to enter into this Agreement and perform its obligations hereunder
and the enforceability of this Agreement, and a corporate resolution of the
Contractor authorizing the transactions set forth herein, each in form and
substance reasonably satisfactory to Owner.
ARTICLE II
Construction of the Facility
Section 2.1 - Architect.
(a) Contractor has engaged Xxxx X. Xxxxxxx, AIA, of Quincy, Massachusetts
as the architect for the Facility ("Architect"). Contractor will also engage
engineers which Contractor selects, in its sole discretion. The Architect has
prepared final plans
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and specifications for the Facility. Such final plans and specifications are
listed on Exhibit "E" ("Final Plans")
(b) Upon the payment of the Contractor's requisition for the Architect's
preparation of the Final Plans, the Owner shall have the exclusive right to use
the Final Plans, provided however, that in the event a transfer of the DON to
the Contractor is made pursuant to Section 2.8, upon reconveyance of the
Premises to Contractor, the Contractor shall have the exclusive right to use the
Final Plans, subject, however, to whatever rights Lender has to such Final
Plans, if any.
(c) The Final Plans have been approved by DPH. Within two (2) weeks after
the execution of this Agreement, the parties will meet to review and approve the
same, revising them if required. Owner agrees that it will not unreasonably
withhold its approval of the Final Plans if they conform in material respects to
the preliminary plans which have been approved by the Owner ("Preliminary
Plans"). The parties agree to use their best efforts to reach a prompt and
reasonable conclusion. The parties shall initial the Final Plans as an
indication of their approval of the same.
Section 2.2 - Other Professionals. Except as otherwise set forth in Section
2.14, the Owner represents that it shall not engage any architects nor any
engineers, lawyers, consultants, accountants nor other professionals with
respect to the Facility which Contractor viii be obligated to pay, Other than as
requested by Contractor. Contractor shall have complete discretion to approve
and retain all professionals, contractors and subcontractors who will be
involved in the design, development and construction of the Facility.
Section 2.3 - Failure to Approve Final Plans. If Owner fails to approve the
Final Plans and that failure is a result of Owner's good faith belief that the
Final Plans do not substantially conform to the Preliminary Plans, Owner shall
give Contractor written notice specifying the areas of the alleged nonconformity
with the Preliminary Plans. Contractor may, at contractor's cost and expense,
cause the Architect to revise the Final Plans or Contractor may submit the issue
of conformity with the Preliminary Plans to arbitration in accordance with this
Section. Contractor shall give Owner written notice of Contractor's election
within twenty (20) days of Contractor's receipt of Owner's notice of
nonconformity if Contractor determines to seek arbitration. Owner and Contractor
shall, within fifteen (15) days of the date of Contractor's notice, each select
an architect, and the two architects shall within ten (10) days of their
selection, select a third architect, all of whom shall be licensed to practice
in the Commonwealth of Massachusetts and shall have substantial experience in
health care design. The Architect shall not be a member of such panel.
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The architects so selected shall review the Preliminary Plans and the Final
Plans and shall, acting by a majority, render a written decision as to whether
the Final Plans are in substantial conformity with the Preliminary Plans and, if
not so, shall state such deficiency. Such decision shall be rendered within
thirty (30) days of the selection of the third architect, shall set forth in
reasonable detail the reasons for the arbitrators' decision, and shall be
binding upon the parties. If the arbitrators determine that the Final Plans do
substantially conform to the Preliminary Plans, then Owner shell be obligated to
reimburse Contractor for the expenses incurred by the Contractor for the
arbitration proceedings. If the arbitrators determine that the Final Plans do
not substantially conform to the Preliminary Plans, Contractor shall reimburse
Owner for all costs and expenses incurred by Purchaser in connection with the
arbitration proceeding and Contractor shall at its sole cost and expense, cause
the Architect to revise the Final Plans in accordance with the arbitrators'
written decision.
Section 2.4 - Construction. The Contractor shall perform the work
substantially in accordance with the Final Plans subject to field changes, minor
design changes, and other immaterial changes which Contractor deems appropriate
during the course of construction, provided, however, that any change deemed
material by the Owner and the Contractor, or, if the Owner and the Contractor
cannot agree within seven (7) business days, then in the opinion of an architect
jointly chosen by the Owner and the Contractor ("Second Architect"), shall
require the Owner's written approval, which approval shall not be unreasonably
withheld or delayed. The Owner's granting of such approval shall not cause any
such change to be deemed all Owner Change as defined in Section 2.6. All work
shall be done in a good and workmanlike manner in accordance with applicable
federal and state statutes and regulations, and municipal building codes and
zoning ordinances, and in accordance with the DON and Land Use Approvals, if
required. The construction shall be performed in conformity with requirements of
applicable federal, state and local governmental agencies having jurisdiction of
the Facility, including Life Safety Code requirements imposed by the Federal
Department of Health and Human Services. The Contractor, on behalf of the Owner,
shall obtain all local, state or federal governmental approvals, if any, of the
Final Plans.
Section 2.5 - Personal Property.
(a) Contractor and Owner acknowledge that, incorporated into the Contract
Price (as defined herein) is an allowance of One Hundred Thousand Dollars
($100,000) for certain furniture, fixtures and equipment ("Group III Items")
more specifically set forth on Exhibit "F". The choice of the vendor for the
Group III Items and the nature. makes, models and quantities of the Group III
Items shall be in the sole discretion of the Owner. The
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Owner agrees to choose the vendors for the Group III Items and the makes, models
and quantities of the Group III Items promptly after notice from the Contractor
so that the Facility is equipped in a timely fashion in preparation for its
inspection by any state or local fire xxxxxxxx, representative of DPH, building
inspector, or other governmental representative having jurisdiction over the
Facility. Contractor will provide all other furniture, fixtures and equipment
other than the Group III Items consistent with the Final Plans and the
furnishings list which is included hereto as Exhibit "G" ("FFE"). The FFE listed
on Exhibit "G" hereto shall be of substantially the same pro-rata quantity (on a
per bed basis) and quality as the furnishings, fixtures and equipment in certain
123 bed skilled nursing facility owned and operated by an affiliate of Owner in
Attleboro, Massachusetts ("Attleboro Facility"). All furniture, fixtures and
equipment of a quality or pro-rata quantity (on a per bed basis) exceeding that
of the furnishings, fixtures and equipment of the Attleboro Facility shall be
paid for by the Owner for a price not included in the Contract Price.
(b) Reference is made to the 123 bed skilled nursing facility located in
Milford, Massachusetts known as Xxxxxxx Xxxxxxx which is owned and operated by
an affiliate of Contractor (the "Milford Facility"). Owner and Contractor agree
that the interior design for the Facility (i.e., wallpaper, carpet, trim and
molding, light fixtures, ceiling finishes, window treatments, cubicle curtains,
etc.) shall be substantially the same as or substantially consistent with the
design of the Milford Facility.
Section 2.6 - Changes.
(a) Owner agrees that Contractor shall have the right to make changes in
the Final Plans if required by any federal, state or local governmental
authority or official or if required due to the unavailability of any
construction material. Any such change shall not be deemed an Owner Change (as
defined below) unless it arises out of a change to the Final Plans requested by
Owner. Owner shall be consulted with respect to any such changes or
substitutions but Contractor shall have final authority to make all decisions
with respect to such changes as long as such changes result in construction,
space, equipment. interior design. and exterior design substantially equivalent
in quality and quantity to that shown on the Final Plans provided, however, that
any change deemed material by the Owner and the Contractor, or alternatively by
the Second Architect, shall require the Owner's written approval, which approval
shall not be unreasonably withheld or delayed. Any changes in the Final Plans,
made either at the request of the Owner or required by modifications made by the
Owner ("Owner Changes"), which have the effect of increasing the cost of the
work shall result in an addition to the Contract price in an amount equal to the
actual net cost thereof for the first $100,000 of such Owner Changes and
thereafter shall result
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in an addition to the Contract Price in an amount equal to the net cost thereof
plus ten percent (10%). Owner shall pay for any net increase to the Contract
Price caused by any Owner Changes at the time of the payment or the requisition
for any such change order. All change orders must be in writing and signed by
both Owner and Contractor.
(b) All work performed and equipment utilized in providing; the Facility
with piped medical gases shall be deemed to be an addition requiring a change
order and snail result in a payment to contractor of Seventy Thousand Dollars
($70,000) in addition to the Contract Price.
Section 2.7 - Commencement of Construction. The parties agree that
construction of the Facility started on August 13, 1993 ("Start Date").
Section 2.8 - Continuity of Construction. Construction, once undertaken,
shall proceed in a continuous and expeditious manner until Physical Completion,
as such term is defined in Section 2.9, is achieved. Physical Completion shall
take place no later than fourteen (14) months from the Start Date (the
"Completion Date"). Any delays caused by acts of God, fire, accident, casualty,
labor strikes or job actions, or any other cause not attributable to the failure
of the Contractor to use reasonable care and due diligence ("Force Majeure"),
however, shall be excused by the Owner, provided that Contractor shall use its
best efforts to minimize any such delays and shall resume construction at the
earliest possible time. Notwithstanding the foregoing, in the event of any delay
caused by a Force Majeure which extends the date of Physical Completion beyond
the Completion Date, the Contractor shall be Obligated to pay to the Lender any
additional interest, attorneys', inspection and consulting fees and all other
expenses under the Lender Loan payable as a direct and proximate result of any
such delay (the "Lender Direct Costs") beyond the Completion Date which shall be
the Owner's sole and exclusive remedy as a result of such delay. In the event
that any delay as a result of a Force Majeure extends the date of Physical
Completion beyond the Completion Date by a period of twelve (12) months or more,
the Owner shall within three (3) days after receipt of notice from the
Contractor, deliver to the Contractor a completed and signed application to
transfer the ownership of the DON to the Contractor or its designee. In such
event, the Owner agrees to use its reasonable best efforts to obtain DPH
approval for such transfer which shall include, without limitation, timely and
accurate responses to questions or requests for information from DPH whether
such questions or requests shall be written or oral, the timely completion and
submission of any applications requested by DPH and attendance at any hearings
held by DPH at such the Owner's attendance is requested, mandated or otherwise
necessary. Upon the approval by DPH of a transfer of the DON
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back to the Contractor or its designee, the Owner shall within thirty (30) days
of the date of Owner's receipt of the Contractor's notice thereof, reconvey all
right, title and interest in and to the Premises and the Facility and all rights
related thereto and the Contractor shall assume all of the obligations of the
Owner under the Lender Loan, subject to the consent of Lender, and whether or
not Lender consents to such an assumption shall indemnify the Owner for all
obligations arising under the Lender Loan from and after the date such transfer
occurs pursuant to the terms of the Contractor Indemnification.
Section 2.9 - Completion of Construction. For the of this Agreement, the
terms "Physical Completion" or "Physically Completed" shall be deemed to occur
on the date on which the building and improvements described and set forth in
the Final Plans: (i) have been completed in accordance with the Final Plans, as
the same may have been modified in accordance with the terms of this Agreement;
(ii) have been approved for occupancy by the local building inspector (and by
the local Fire Xxxxxxxx in the event his approval is required) as evidenced by
the issuance of a temporary certificate of occupancy provided that such
temporary certificate of occupancy does not affect actual occupancy of the
Facility by patients or the licensing of the Facility by the DPH; (iii) have
passed the so-called physical plant inspection by the DPH in a manner which does
not prevent the licensing inspection of the Facility; and (iv) the FFE has been
furnished such that the Facility may be licensed and such that with respect to
other than patient rooms, the Facility is fully operational, provided, however
that in the event of delays in the furnishing of the FFE occasioned by the
action or inaction of the Owner in choosing or ordering any it items of FFE,
this subparagraph (iv) shall not be a condition in determining whether Physical
Completion has occurred. Physical Completion shall be deemed to have been
achieved notwithstanding that any of such officials or agencies have issued a
Punch-List listing items requiring completion or correction. Physical Completion
shall also be deemed to have been achieved notwithstanding that the Owner may
not yet have satisfied the requirements of the DPH with respect to the
administration of the Facility, medical supplies, medical records, nursing
service and staff, dietary requirements, and other general conditions necessary
to obtain a license for the rendering of nursing services.
Section 2.10 - Punch-List If, at the time the Facility has Physically
Completed, there exist any items requiring completion or correction, then the
Contractor agrees to use all reasonable diligence to complete or correct the
items so that each conforms to the Final Plans. The parties shall make a
Punch-List of the items requiring completion or correction. Each item on the
Punch-List shall be assigned a reasonable value based upon the Contractor's and
Owner's good faith estimate of the cost or completion or correction of the same.
Contractor shall deduct
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one hundred and fifty percent (l50%) of such total cost (the "Punch-List Amount"
from the balance of the Contract Price (as defined in Section 4.1). Owner and
the Contractor shall execute and deliver an agreement concurrently with the
approval of the Punch-List, under the terms of which the Owner shall agree to
promptly pay to the Contractor an amount equal to 150% of the estimated cost of
completion or correction of each item in the Punch-List upon its completion or
correction. If any item is not completed or corrected within a period of ninety
(90) days, at the Owner's option an amount equal to the cost of completion or
correction of the item say be offset against the Punch List Amount, and
Contractor shall have no further obligation with respect to such item. If the
Owner elects not to offset against the Punch List Amount, the Contractor shall
continue to be obligated to correct such items. After all appropriate offsets,
the Owner .shall promptly pay the balance of the Punch-List Amount, if any, to
the Contractor.
Section 2.11 - Work and Warranties. At the Closing. Contractor will assign
to Owner. in addition to any warranties created by law, all warranties and
guarantees received from subcontractors and suppliers of equipment and
furnishings1 to the extent assignable. Contractor will agree to remedy any
defect in construction caused by poor workmanship or materials which are brought
to its attention by written notice within a period of one (1) year from the date
of Physical Completion.
Section 2.12 - Subcontractors. The Contractor shall furnish the names of
all subcontractors who supplied equipment. labor or materials having a value in
excess of Fifty Thousand Dollars ($50,000) in connection with the construction
of the improvements on the Premises, after the hiring of subcontractors. All of
such subcontractors shall contract with the Contractor for the provisions of
equipment, labor or materials for the Facility and not with the Owner.
Contractor hereby indemnifies and saves Owner harmless from claim for payment by
any subcontractor of Contractor who furnishes equipment, materials or supplies
or performs labor or services in the prosecution of the work, other than any
supplier of the Group III Items or person performing work in connection with any
Group II Items in excess of the allowance therefor, or otherwise contracting
directly with Owner.
Section 2.13 - Right of Owner to Cure. If the Contractor defaults or
neglects to carry out its obligations under the terms of this Agreement in
accordance with the term of this Agreement and fails within thirty (30) days
after receipt of written notice from the Owner to commence and continue
correction of such default or neglect with diligence and promptness, the Owner
may, if such default remains uncured after such thirty (30) day period and
without prejudice to other remedies the Owner may have, correct such
deficiencies. In such case an appropriate change order shall be issued deducting
from payment then or thereafter
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due the Contractor, the reasonable costs of correcting such deficiencies. If the
payments then or thereafter due the Contractor are not sufficient, the
Contractor shall pay the difference to the Owner.
Section 2.14 - Termination by the Owner.
(a) This Agreement may be terminated by the Owner upon fifteen (15)
business days written notice to the Contractor in the event that
Contractor stops all work on the facility construction inspector or
alternatively, a mutually agreeable Second Architect issues a
certificate to such effect) and abandons the Facility, other than as a
result of a Force Majeure or a breach by Owner hereunder; unless
Contractor shall have recommenced Work on the Facility continuously
and diligently during the second fifteen (15) business day notice
period.
(b) If the Contractor materially defaults under this Agreement or
persistently fails or neglects to carry out the material terms of this
Agreement or materially fails to perform the provisions of this
Agreement in a manner that has a material adverse effect upon the
construction or the progress of construction (as certified by the
Architect), the Owner my give written notice to Contractor that the
Owner intends to terminate this Agreement. If the Contractor fails to
correct the material defaults, failure or neglect within fifteen (15)
business days after being given notice, the Owner my then give a
second written notice and, after an additional fifteen (l5) business
days if such default remains uncured after such second fifteen
(15)business day cure period or such longer period as my reasonably be
required to effect a cure, provided that the Contractor commences and
diligently prosecutes a cure, the Owner my at the Owner's option,
terminate this Agreement.
(c) In the event of any termination under clause (a) or (b) above, the
Owner shall pay the Contractor for work completed and for proven loss
sustained upon materials, equipment and applicable damages, and, upon
Physical Completion, reasonable profit and overhead. Such reasonable
profit and overhead shall include, without limitation, a sum equal to
the percent complete of the hard construction cost of the Facility as
indicated on a draw request multiplied by the principal amount of the
Price Increase Loan and the Cash Collateral Holdback, offset by the
Owner's actual reasonable costs incurred directly by Owner and
certified by the
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Architect, in excess of the balance of the Contract Price related to
promptly achieving Physical Completion of the Facility after such
termination proceeding in a reasonable manner. Upon any such payment,
all debts and obligations of each party to the other on account of
such termination and this Agreement (except for those representations
and warranties, covenant and indemnities which survive this Agreement)
shall be deemed discharged, terminated and released.
ARTICLE III
FINANCING
Section 3.1 - Construction/Permanent Financing.
(a) Owner has obtained construction and permanent financing (collectively,
the "Financing") for the Facility from Lender upon terms and conditions
reasonably acceptable to Owner ("Lender Loan"). Owner represents and warrants to
the Contractor that the Lender Loan is of an adequate principal amount to
provide for progress payments to the Contractor in the amount of $10,831,689.00.
Owner shall be solely responsible for paying the financing costs, legal fees,
title insurance and other so-called "soft costs" associated with the Financing
as described below. Owner shall receive a credit against the Contract Price,
pursuant to Section 4.2(vi), to the extent of such soft costs paid by the Owner,
up to the allowance for such soft costs set forth in the DON as finally
determined by the DPH.
(b) The Contractor and Owner also contemplate that the Premises and
Facility may serve as security for the payment obligations under the Lender Loan
and that the Owner will be the obligor for the repayment of all financial
obligations thereunder. Owner agrees to promptly execute and deliver all
commitments, mortgages, collateral assignments, promissory notes, guaranties,
agreements, documents, certificates, affidavits, and other writings required to
be executed by Lender in connection with the Lender Loan.
(c) The cost of securing financing in an amount equal to the allowance for
such items under the final DPH approved DON and interest which accrues on all
financing prior to the date of Physical Completion in an amount equal to the
allowance for such item under the final DPH approved DON are included in the
Contract Price, provided, however, that the Owner shall Pay loan fees interest
and attorneys fees in excess of such amounts incurred in connection with the
Lender Loan. In the event loan fees are assessed or interest accrues beyond the
amount in the maximum capital allowance under the DON as a result of delays in
construction which are the Owner's fault, then the Owner shall pay such
additional loan fees or interest. In the event that the
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Contractor is solely or in part responsible for delays in construction beyond
the Completion Date, or in the event of a Force Majeure pursuant to Section 2.8,
the Contractor shall be responsible to the Owner for the increased interest
coats or any other Lender Direct Costs that Owner incurred for the period of
such delay which are attributable to the Contractor or such Force Majeure.
However, in no event shall the Contractor be responsible for any delays in
construction so long as the Facility is completed by the Completion Date. In any
event of an increase in such fees or interest the Contractor will assist the
Owner in attempting to obtain an increase in the maximum expenditure under the
DON to cover such increase.
Section 3.2 Price Increase Loan.
(a) At the Closing, subject to the contingencies set forth in Article VI
and elsewhere in this Agreement, in the event that the Contractor chooses, in
its sole discretion, to increase the number of licensed beds at the Facility as
set forth in Section 1.3, the Contractor shall provide to the Owner additional
financing in an amount equal to the resulting increase in the Contract Price
("Price Increase Loan"), in accordance with Section 1.3 until such increase is
funded to the Owner under the Lender Loan.
(b) The Price Increase Loan shall bear no interest and shall be due and
payable only: (i) upon the Facility's census reaching one hundred twelve (112)
patients; and (ii) the Lender's release of loan proceeds sufficient to pay the
Price Increase Loan, unless Lender refuses to release such loan proceeds as a
result of the matters set forth in clauses (i), (ii) or (iii) of Section 7.17
hereof. The Price Increase Loan may be prepaid without penalty. The Price
Increase Loan shall be due and payable, at the option of the Contractor, if
after Physical Completion the Owner shall:
1) admit in writing its inability to pay its debt as they become
due;
2) file a petition in bankruptcy or a petition to take advantage of
any insolvency act;
3) make an assignment for the benefit of its creditors;
4) consent to the appointment of a receiver for itself or the whole
or substantially all of its property;
5) as a result of a petition in bankruptcy filed against it without
such petition being dismissed within 120 days after the date of
such filing;
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6) file a petition or answer seeking reorganization or arrangement
or other aid or relief under any bankruptcy or insolvency laws or
any other lawful relief of debtors; or
7) transfer any interest in the Facility, either directly or
indirectly except for a bequest or intestate succession arising
out of the death of Xxxxxxx X. Xxxxxxx and except for transfers
to affiliates of the Owner without the prior written consent of
Contractor.
ARTICLE IV
Closing
Section 4.1 - Date of Closing. The conveyance of title to the Premises and
the payment to Contractor of the Contractor's initial requisition to the extent
approved by Owner and Lender, which shall include, all out of pocket expenses
incurred by Contractor and its affiliates through the closing date with respect
to the Facility, including without limitation, for architects, engineers,
attorneys and consultants; the amount, if any, expended by Contractor in
connection with the acquisition of the Premises; and the amount expended by the
Contractor in the development and construction of the Premises, shall take place
simultaneously with the consummation of the Lender Loan (the "Closing") which
shall take place on or before June 30, 1994. Said payment to the Contractor at
Closing shall be limited to the maximum amount funded by Lender and shall be
credited against the Contract Price; provided, however, that nothing herein
shall abrogate the obligation of the Owner to pay the Contract Price in
accordance with Section 4.3.
Section 4.2 - Contract Price. The price to be paid by the Owner for all of
the materials and services to be provided by Contractor hereunder ("Contract
Price") shall be equal to the sum of: (i) the final maximum capital expenditure
("MCE") amount allowed under the DON, as determined by the DPH based upon the
Contractor's submission pursuant to 105 C.X.R. l00.551(I)(l)-(5), which
submission is to be made within 180 days after Final Plan approval; plus (ii)
$500,000; plus (iii) the cost of any additional furniture, fixtures and
equipment if not previously paid by the Owner (as described in Section 2.5);
plus (iv) any Owner Changes (as described in Section 2.6); plus (v) $835,823.00
in the event of the Bed Increase to the extent such amount is not included in
the MCE in accordance with subparagraph (i) above, minus any Non-Reimbursable
Expenses; minus (vi) any costs or expenses, if any, allowed in the MCE up to the
amount of the line item in the MCE for each such item which has been paid
directly by Owner after obtaining the approval of the Contractor.
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Section 4.3 - Payment of the Contract Price. The Owner shall pay the
Contract Price at the following times and in the following manner:
(a) The expenses to be reimbursed at the Closing in accordance with Section
4.1 will be paid at Closing. Prior to the Closing, the Contractor and the Owner
shall develop and agree upon a schedule of values for the Facility based upon
the line items in the MCE, a copy of which is attached hereto as Exhibit "I"
which shall be initialled by the Contractor and the Owner to evidence their
agreement and be approved by Lender ("Schedule of Values"). Based upon
applications for payment submitted to the Architect by the Contractor and
verified by Owner, and Certificates for Payment issued by the Architect, the
general contractor, and the Contractor, the Owner shall submit applications for
payment requesting Lender to make progress payments on account of certain items
on the Schedule of Values based upon a percent complete basis as certified by
the Architect to the Contractor. Certain other items on the Schedule of Values
will be paid as incurred. The Cash Collateral Holdback (as hereinafter defined)
shall be paid as set forth in Section 4.3(c) and the Price Increase Loan shall
be paid as set forth in Section 4.3(b). The period covered by each Application
for Payment shall be one calendar month ending on the last day of the month.
Each Application for Payment shall be based upon the most recent Schedule of
Values submitted by the Contractor and approved by Owner and Lender, which
approval shall not be unreasonably withheld or delayed. Applications for Payment
shall show the amount due for each item shown on said Schedule of Values as of
the end of the period covered by the Application for Payment. The amount of each
such progress payment which is to be paid based on a percent complete basis
shall be the Sum of (i) the product of multiplying that portion of such item
properly allocable to completed work for such item by the percentage of
completion of that item, and (ii) the portion of such item properly allocable to
materials and equipment delivered and suitably stored at the site for subsequent
incorporation in the work or suitably stored off the site, minus the aggregate
of previous payments made by the Owner for such item and minus such retainage as
is typically required in other construction loans obtained by Owner's
affiliates. Notwithstanding anything set forth in this paragraph to the
contrary, the terms and expense of progress payments on account of the Contract
Price made from the Owner to the Contractor shall be subject to the terms and
conditions of the Lender Loan as they relate to the Contractor's obligations.
Owner shall use its best efforts to have the Certificates for Payment approved
by and paid by lender. In the event that Owner does not approve an application
for payment, the Owner will within two (2) business days notify Contractor, in
writing, of the reasons for the withholding of such approval. If Contractor and
Owner cannot agree on a revised amount the Owner will promptly execute an
application for payment for the amount
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for which Owner feels is due and paying in accordance with the terms of this
Agreement. If the Owner does not issue an application for payment or a written
notification to Contractor of its reason for withholding an application for
payment in accordance with this Agreement, through no fault of Contractor,
within five business days after the receipt of an application for payment or if
Owner does not request that Lender pay Contractor within five days after the
receipt by Owner of an application for payment, then Contractor, may upon seven
additiona1 business days after written notice to Owner and Lender, stop the work
order this Agreement until payment of the amount owing has been received. Any
such period of stoppage shall be added to the period of time during which the
Contractor is to achieve Physical Completion as set forth in Section 2.8.
(b) That portion of the Contract Price relating to the Price Increase Loan
shall be payable in accordance with the terms of Section 3.2.
(c) That portion of the contract Price in the amount of Five Hundred
Thousand Dollars ($500,000) (the "Loan Collateral Holdback") shall be due upon
Physical Completion but shall not be payable until the Owner's achievement of a
debt service coverage ratio at the Facility of 1.2 to 1 as determined by Lender,
and the Lender's release of the Cash Collateral Holdback; provided, however,
that the Cash Collateral Holdback shall be payable by the Owner in any event
upon the Facility achieving a debt service coverage ratio of 1.2 to 1 if Lender
refuses to release the cash collateral held by the Lender as a result of any
default of Owner, or any of its affiliates, under any agreement between Owner.
or any of its affiliates, and Lender not attributable to any action or inaction
of or by the Contractor. The Cash Collateral Holdback shall bear interest from
the date of Physical Completion at the rate of the base rate then in effect at
the Bank of Boston, plus three percent (3%) per annum until paid. Owner shall
assign its rights to the first $500,000 of such collateral plus interest thereon
to Contractor pursuant to a collateral assignment thereof in the form attached
as Exhibit "H" which the Owner hereby agrees to execute and deliver to the
Contractor upon Physical Completion.
(d) In the event that any of Contractor's approved requisitions, or
payments set forth in subsections (b) or (c) above, are not paid when due,
solely due to delays incurred through the fault of or through circumstances
under the control of the Owner or its affiliates, the Owner shall pay interest
to the Contractor, monthly in arrears on any such outstanding amount. Such
monthly interest shall be computed at a rate equal to the base rate then in
effect at the Bank of Boston, plus three percent (3%) per annum.
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(e) Owner's obligation to pay the Price Increase Loan and Owner's
obligation to pay the Cash Collateral Holdback may be offset by proven losses
sustained upon materials and equipment caused by the Contractor's material
breach of this Agreement which is not cured within the applicable time period
therefor. In the event that the Owner chooses to exercise its right of offset
under this Section 4.3(e), it shall first provide the Contractor with written
notice of such intent, to offset, setting forth the reasons therefor. Contractor
shall have a period of seven days from its receipt of the Owner's notice within
which to notify the Owner of the Contractor's desire to contest such offset. In
the event that the Owner and the Contractor cannot agree within seven (7) days
from the date of the Contractor's notice whether such offset is appropriate, the
parties agree to submit such issue to binding arbitration before the American
Arbitration Association in Boston, and agree to be bound by the decision
rendered in any such arbitration.
Section 4.4 - Documents to be Delivered by Contractor at Closing. At the
Closing, the Contractor shall deliver, or shall cause to be delivered, the
following to the Owner:
(a) A quitclaim deed with covenants against grantor's acts;
(b) A xxxx of sale;
(c) The assignment of Land Use Approvals set forth in Section 1.3;
(d) The survey described in Section 1.2;
(e) A hazardous waste affidavit;
(f) The insurance certificates described in Section 5.1(b);
(g) The affidavits and waivers described in Section 5.1(c);
(h) The Contractor's initial requisition and supporting information
relating thereto; and
(i) Final approval of the transfer of the DON and an assignment thereof.
Section 4.5 - Documents to be Delivered by the Owner at Closing. At the
Closing the Owner shall deliver the following to the Contractor:
(a) The payment set forth in Section 4.1; and
(b) The license to Contractor set forth in Section 1.3(a).
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ARTICLE V
Additional Responsibilities of Parties
Section 5.1 - Contractor's Responsibilities. In addition to its obligations
elsewhere expressed in this Agreement, the Contractor shall have the following
responsibilities:
(a) To obtain and pay for the Certificate of Occupancy;
(b) The Contractor shall at all times, commencing with the date upon which
construction begins, carry or cause to be carried the following types of
insurance with an insurance carrier or carriers reasonably acceptable to Lender:
(i) Worker's compensation insurance covering all persons engaged in
the performance of this Agreement in accordance with applicable
law.
(ii) Public liability insurance covering death or bodily injury with
limits of not less than $300,000 for one person and $1,000,000
for any one accident or disaster; and property damage coverage
limits of not less. than $100,000; all of which insurance shall
name the Owner and Lender if any, as an additional insured.
(iii) "Builders Risk" insurance against damage or destruction by fire
and full extended coverage, including vandalism and malicious
mischief, covering all improvements to be erected hereunder and
all materials for the same which are on or about the Premises, in
an amount equal to the full insurable value of such improvements
and materials; such insurance, to be payable to Owner, Contractor
and Lender, if any, as their interests may appear, with, standard
mortgage endorsement to Lender or its assigns as mortgagee.
(iv) Comprehensive general liability under a primary policy and
umbrella policy with limits not less than $5,000,000.00 which
will include the following:
(a) Contractor's Liability;
(b) Contractual Liability;
(c) Owners and Contractors Protective Liability;
(d) Completed Operations Liability;
(e) Products Liability; and
(f) Personal Injury
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(v) Any other insurance required of the Contractor by Lender.
The Contractor shall furnish to the Owner and Lender, if any, duplicate
policies of insurance as set forth in Subparagraphs (i), (ii), (iii) and
(iv) hereof. The coverages described above may be carried by the Contractor
under an Owner's Protective Liability Policy with the same limits of
coverage, naming Owner, which policy shall be subject to the Owner's
reasonable approval. The Owner shall be named as an additional insured on
such policies as may be appropriate. Each of such policies shall contain,
to the extent customarily obtainable in Massachusetts, a provision to the
effect that they may not be canceled except upon ten days' prior written
notice to the Owner and Lender.
(c) At the time of Closing, and with each requisition, Contractor shall
deliver to Owner the following:
(i) a duly executed waivers of mechanic's liens signed by each
subcontractor which provided labor or materials for the
construction of the Facility;
(ii) an affidavit to the title insurance company enabling Owner to
obtain title insurance coverage insuring the Owner and Lender, if
any, against collection as enforcement of mechanic's liens
against the Premises;
(iii) Such other documents or instruments as Owner may reasonably
require or as Lender may require of Contractor.
Section 5.2 - Owner's Responsibilities. In addition to its obligations
elsewhere expressed in this Agreement, the Owner shall have the following
responsibilities:
(a) To cause Owner's counsel to render legal opinion to Lender with respect
to the Owner's obligations, warranties, and representations set forth herein (as
they pertain to legal matters) and with respect to other legal opinions
(pertaining to the Owner, the Facility and the Premises) as any Lender may
require.
(b) Owner is solely responsible for obtaining financing as set forth in
Section 3.1(a). Owner will use its best efforts to consummate financing for the
contemplated construction, including the furnishing of financial statements,
providing an appraisal of the Premises and Facility and by notes, guarantees,
mortgages, assumption agreements and other documents reasonably necessary to
effectuate such financing, and Owner shall pay all costs associated with such
financing (which
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costs shall be deducted from the Contract Price) in accordance with Section
3.1(d).
(c) To keep the DON in full force and effect as the holder thereof,
subsequent to the transfer of the DON to the Owner.
Section 5.3 - Indemnification. The Contractor hereby agrees to indemnify
and hold the Owner harmless from all liabilities, claims, and demands for
personal injury or property damage arising out of or caused by any act or
omission of Contractor, its subcontractors, agents, or employees, or, to the
extent not caused by any action or inaction of Owner, its agents or employees,
arising in or about the Premises for the period from the date of this Agreement
until Physical Completion. The Contractor further covenants to use proper care
and caution in the performance of its work hereunder so as not to cause damage
to any adjoining or adjacent property.
ARTICLE VI
Contingencies
Section 6.1 - Required Occurrences. At the time of closing if not otherwise
specified below, unless such period is extended by written notice of the Owner,
this Agreement and the undertakings of Contractor or the Owner shall, at the
election of Contractor (as to subparagraph (f) below only) or the Owner (as to
subparagraphs (a) through (f) below), as the case may be, be contingent upon the
occurrence of each of the following contingencies:
(a) Additional Approvals. Licenses. Permits, Easements and Premises All of
the zoning approvals, additional licenses, and additional easements, if any,
needed for the construction of the Facility shall have been obtained in form
reasonably satisfactory to Owner, Contractor and Lender, with no limitations or
conditions which are reasonably unacceptable to Contractor, Owner and Lender,
and no appeals of said additional licenses shall have been taken during the
applicable appeal periods by Closing.
(b) Utility Letters. Letters in form reasonably satisfactory to Contractor,
Owner and Lender confirming the availability of all utility services shall be
obtained by Contractor by Closing.
(c) Environmental Receipt by Closing of an environmental report reasonably
satisfactory to Owner and Lender indicating that the premises are free of any
material environmental contamination.
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(d) Title and Survey. Owner shall have received by Closing evidence
reasonably satisfactory to it and Lender that the title to the Premises is good,
clear record and marketable title free of encumbrances except for Existing
Encumbrances, those other encumbrances permitted by Section 1.2 and those which
will not materially and adversely effect the construction and use of the
Facility thereon and a survey of the Premises reasonably acceptable to Owner and
Lender.
(e) Contractor Indemnification. An indemnification reasonably satisfactory
in form and in substance to Owner, Xxxxxxx X. Xxxxxxx and Life Care Centers of
America, Inc., by the Contractor against costs and expenses incurred under the
Lender Loan in the event that the transfer of the DON back to the Contractor is
made pursuant to Section 2.8 ("Contractor Indemnification") so long as the Owner
transfers the Facility and the Premises back to the Contractor's nominee, a copy
of which is attached hereto as Exhibit "J".
(f) The continued accuracy of all of the representations and warranties of
each party. as of the Closing.
(g) The DON shall have been transferred to the Owner and is in full force
and effect.
Section 6.2 - Failure of Contingencies. In the event that any one or more
of the contingencies set forth in this Article is not satisfied or waived by the
Owner, or the Contractor in the case of a failure of the contingency in
subparagraph (f) caused by Owner ("Owner's Default"), in writing at the time of
Closing or within such other period of time set forth above applicable to such
contingency, then, upon notice to the Contractor (or the Owner, in the case of
Owner's Default) and a fifteen (15) day period during which Contractor (or the
Owner, in the case of Owner's Default) may cause such contingency to be
satisfied. the Owners (or the Contractor, in the case of Owner's Default) may
terminate this Agreement. In such event, neither party shall have further
responsibility or liability to the other except for Contractor's indemnification
of the Owner pursuant to Section 5.3, which shall survive the closing or the
termination of this Agreement.
Section 6.2 - Default. (a) In the event that the Owner defaults in any of
its obligations under Section 4.3 hereof after fifteen (15) business days
written notice and such default remains uncured fifteen (15) business days after
the expiration of the first fifteen (15) business day period ("Event of
Default"), the Owner shall within three (3) days after receipt of notice from
the Contractor, deliver to the Contractor a completed and signed application to
transfer the ownership of the DON to the Contractor or its designee. In such
event, the Owner agrees to use its reasonable best efforts to obtain DPH
approval for
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such transfer which shall include, without limitation, timely and accurate
responses to questions or requests for information from DPH whether such
questions or requests shall be written or oral, the timely completion and
submission of any applications requested by DPH and attendance at any hearings
held by DPH at which the Owner's attendance is requested, mandated or otherwise
necessary. In the event of such a default by the Owner in its obligations under
this Agreement, and the approval of the retransfer of the DON to the Contractor
is approved by DPH, the Owner agrees that certain of the damages suffered by the
Contractor are not readily susceptible to calculation. Therefore, in such event,
the Owner agrees to pay the Contractor the sum of Five Hundred Thousand Dollars
($500,000) as liquidated damages and not as penalty, within seven (7) days after
receipt of notice of the approval by DPH of the retransfer of the DON, the
premises, and the Facility to the Contractor. In the case of an Event of
Default, the foregoing shall be the Contractor's exclusive remedy. If an Event
of Default occurs and, for whatever reason, the DON, the Premises or the
Facility are not retransferred to the Contractor, the Owner shall pay to the
Contractor all damages to which the Contractor shall be entitled at law or in
equity within seven (7) days after the receipt by the Owner of notice from the
Contractor of such Event of Default and the failure of the Owner to retransfer
the DON, the Premises and the Facility to the Contractor with the approval of
the DPH. upon the approval by DPH of a transfer of the DON back to the
Contractor or it. designee, the Owner shall within ten (10) days of the date of
Owner's receipt of the Contractor's notice, reconvey to the Contractor or its
nominee all right, title and interest in and to the Premises and the Facility
and all rights related thereto.
(b) In the event the Owner defaults under any of its obligations under this
Agreement other than those set forth in Section 4.3 after fifteen (15) business
days written notice from the Contractor to the Owner and an additional fifteen
(15) business days within which to cure, the Contractor may seek whatever
damages and use whatever remedies it may have at law or in equity.
ARTICLE VII
Concluding Provisions
Section 7-1 - Entire Agreement. All prior understandings, letters of intent
and agreements between the parties are merged in and superseded by this
Agreement (including all Exhibits hereto), which alone fully and completely
expresses their understanding with respect to its subject matters.
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Section 7.2 - Representations. None of the parties shall be bound by any
promises, representations or agreements except as herein expressly set forth.
Section 7.3 - Amendments This Agreement may not be amended, waived,
modified, altered or changed in any respect whatsoever except by a further
agreement, in writing, executed by each of the parties.
Section 7.4 - Joint Effort. The preparation of this Agreement has been a
joint effort of the parties, and the resulting document shall not be construed
more severely against one of the parties than the other.
Section 7.5 - No Brokers. Contractor and Owner each represent and warrant
to the other that no broker or finder has acted on its behalf in connection with
this Agreement, or the transactions contemplated hereby or referred to herein.
Contractor and Owner each agrees to indemnify and hold and save the other
harmless from any claim or demand for commission or other compensation by any
other broker, finder or similar agent.
Section 7.6 - Assignment. Neither Owner nor Contractor shall have the right
to assign its rights and delegate its obligations under this Agreement to
another entity or person without the prior written consent of the other parties
hereto.
Section 7.7 - Notices. All notices which may be given to any of the parties
hereunder shall be in writing and shall be hand delivered or sent by registered
or certified mail, return receipt requested, or by any nationally recognized
overnight carrier and postage prepaid as follows:
(a) In the event that notice is directed to Owner, it shall be sent to
Raynham Medical Investors Limited Partnership, 0000 Xxxxx Xxxxxx, X.X.,
Xxxxxxxxx, Xxxxxxxxx 00000-0000, Attention: Corporate Counsel, or at such other
address or addresses Owner shall from time to time designate by notice to
Contractor.
(b) In the event that notice is directed to contractor, it shall be sent to
Attention: President, Continuum Care Corporation, River Place. 00 Xxxxx Xxxxxx,
Xxxxxxxxx, XX 00000, and a copy thereof mailed to Corporate Counsel, at 00
Xxxxxx Xxxxxx, Xxxxxxxxx, XX 00000; or at such other address or addresses as
Contractor shall from time to time designate by notice to Owner with a copy to:
Xxxxxx X. Xxxxxx, Esq., Levy & Xxxxxx, 00 Xxxxxxxxx Xxxx Xxxx, Xxxxxxxxxx,
Xxxxxxxxxxx 00000. The effective date of any such notice shall be the earlier of
actual receipt by the addressee or three (3) days after such notice is properly
deposited for mailing.
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Section 7.8 - Arbitration. Any dispute or controversy arising between the
parties involving the interpretation or application of any provision of the
Agreement, or arising out of this Agreement, or concerning the construction of
the proposed Facility or the furnishing thereof shall be submitted to and
determined by arbitration in accordance with the rules of the American
Arbitration Association then in effect.
Section 7.9. - Captions. The captions of this Agreement are for convenience
and reference only and in no way define, describe, extend or limit the scope or
intent of this Agreement or the intent of any provision hereof.
Section 7.10 - Successors. This Agreement shall be binding upon the parties
hereto, their respective heirs, executors, administrators, successors and
assigns.
Section 7.11 - Counterparts. This Agreement maybe executed in counterparts,
each of which shall be deemed an original.
Section 7.12 - Severability. The invalidity or unenforceability of one or
more of the phrases, sentences, provisions, clauses, Sections or Articles
contained in this Agreement shall not affect the validity or enforceability of
the remaining portions so long as the material purposes of this can be
determined and effectuated.
Section 7.13 - Effective Date. This Agreement shall be deemed to be
effective as of the date of the execution of this Agreement.
Section 7.14 - No Offer. The delivery of an unexecuted copy of this
Agreement shall not be deemed an offer. No rights are to be conferred upon any
party until this Agreement has been executed and delivered to each party.
Section 7.15 - Governing Law. This Agreement shall be governed by and
enforced in accordance with the laws of the Commonwealth of Massachusetts.
Section 7.16 - Survival. Each of the representations. warranties and
indemnifications of the parties hereto shall survive the Closing or the
termination of this Agreement provided, however, that the monetary obligations
of the parties will be paid in accordance with Section 2.14(a) in the event of a
termination of this Agreement by the Owner pursuant thereto.
Section 7.17 - Compliance with Loan Documents. Notwithstanding anything set
forth herein to the contrary, in the event that any of the terms or conditions
of this Agreement are inconsistent with the terms or conditions of the Lender's
Loan Documents, the terms and conditions of the Lender's Loan
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Documents shall control, provided, however, that in the event of a default under
any of the Loan Documents either (i) attributable to any action or inaction of
the Owner which is not attributable to any action or inaction by or of the
Contractor or (ii) as a result of any cross-default with any other loan between
the Owner, or any of its affiliates, and the Lender, or any of its affiliates or
(iii) not attributab1e to the Contractor, then the obligation of the Owner to
the Contractor hereunder shall remain unaffected and the provisions of this
Agreement shall control; provided however, that Owner shall not consent to any
material amendment of any of the Lender Loan Documents without the prior written
consent of the Contractor. Any material amendment to the Lender Loan Documents
without the prior written consent of the Contractor shall not be binding on the
Contractor. The Owner covenants to cause the Lender to provide to the contractor
true1 accurate and complete copies of all of the Loan Documents.
Dated as of this 3rd day of March. 1994.
Witness: RAYNHAM MEDICAL INVESTORS LIMITED
PARTNERSHIP
By: Developers Investment Company, Inc.
Corporate General Partner
/s/ [Illegible] By: /s/ Xxxx X. X'Xxxxx
----------------------------- -------------------------------
/s/ [Illegible] Its
----------------------------- Duly Authorized Vice-President
CONTINUUM CARE CORPORATION
/s/ [Illegible] By: /s/ X.X. Xxxxxx
----------------------------- -------------------------------
/s/ [Illegible] Its Vice President
----------------------------- Duly Authorized
STATE OF TENNESSEE)
) ss:
COUNTY OF XXXXXXX )
The foregoing instrument was acknowledged before me this 3rd day of March,
1994, by Xxxx X. O'Xxxxx, Vice President of Developers Investment Company, Inc.,
a corporate general partner of Raynham Medical Investors Limited Partnership, a
Tennessee limited partnership on behalf of the limited partnership.
/s/ Xxxxx Xxxxx
-------------------------------
Notary Public
[Notary Public Seal]
-00-
XXXXX XX XXXXXXXXXXXXX)
) ss:
COUNTY OF NORFOLK )
The foregoing instrument was acknowledged before me this 17th day of March,
1994, by Xxxxx X. Xxxxxx, Vice President of Continuum Care Corporation, a
Delaware corporation, on behalf of the corporation.
/s/ Xxxxx X. Xxxxxxxxx
-------------------------------
Notary Public
My Commission Expires June 30, 2000
GUARANTY
The obligations of the Owner hereunder are hereby irrevocably and
unconditionally guarantied by Xxxxxxx X. Xxxxxxx.
WITNESSES:
/s/ [Illegible] /s/ Xxxxxxx X. Xxxxxxx
----------------------------- -------------------------------
Xxxxxxx X. Xxxxxxx
/s/ [Illegible]
-----------------------------
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