EXHIBIT 10.12
AMENDMENT NO. 3
TO THE
AGREEMENT TO PROVIDE
MANAGEMENT SERVICES FOR DIALYSIS FACILITIES
BY AND BETWEEN
MONTEFIORE MEDICAL CENTER
AND
NEW YORK DIALYSIS MANAGEMENT, INC.
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THIS AMENDMENT NO. 3 TO THE AGREEMENT TO PROVIDE MANAGEMENT SERVICES FOR
DIALYSIS FACILITIES ("Amendment No. 3") is made this 17th day of July, 1998, by
and between Montefiore Medical Center, a non-profit corporation organized and
existing under the laws of the State of New York ("Hospital"), and New York
Dialysis Management, Inc., a corporation organized and existing under the laws
of the State of New York ("NYDM").
WHEREAS, the parties hereto have entered into that certain Agreement To
Provide Management Services For Dialysis Facilities (the "Original Management
Agreement"), as amended by Amendment No. 1 thereto and Amendment No. 2 thereto
(as so amended herein referred to as the "Principal Management Agreement"); and
WHEREAS, the parties have entered into an Agreement to Amend and Not-To-
Compete, dated July 17, 1998 (the "Agreement to Amend") and, as required by and
in consideration of the Agreement to Amend, the parties desire to amend the
Principal Management Agreement, all as set forth herein, effective as of the
Consideration Payment Date, as defined in the Agreement to Amend;
NOW, THEREFORE, in consideration of the mutual covenants and conditions
herein set forth, the parties hereto agree as follows:
1. The second and third sentences of Paragraph 2.B.(iii) of the Original
Management Agreement are hereby deleted.
2. The following sentence is hereby added at the end of Paragraph 4.A. of
the Original Management Agreement:
"At the conclusion of the third three-year term, and on each third
anniversary thereafter, this Agreement shall automatically be renewed
for successive three-year terms (subject to the Commissioner's
approval) unless terminated earlier. Those provisions which by their
terms are to be performed following termination, or liabilities for
obligations required to be performed prior to termination, shall
survive the termination of this Agreement."
3. The language contained in Paragraph 4D. and Paragraph 8 of the
Original
Management Agreement is hereby deleted in its entirety and is no longer of any
force or effect.
4. The language contained in Paragraph 5 of the Original Management
Agreement is superceded by the language in Section 3 of the Medical Director and
Administrative Services Agreement by and between Hospital and Everest Dialysis
Services, Inc. ("EDS"), which is attached to the Medical Asset Purchase
Agreement by and between Hospital and EDS, dated as of the date hereof. Subject
to compliance with applicable rules of the State of New York, Hospital agrees
that it shall provide medical director services to each of the Facilities under
the Principal Management Agreement, as amended, providing those services as set
forth in Section 3 of the Medical Director and Administrative Services Agreement
by and between Hospital and EDS, which is attached to the Medical Asset Purchase
Agreement, unless the provision of such services by Hospital is prohibited by
law or regulation. In lieu of the medical director fees that would have been
payable under the Principal Management Agreement prior to the effectiveness of
this Amendment, Hospital shall be entitled to the Medical Director fees at the
rates that would otherwise be paid to Hospital pursuant to Section 6 of the
Medical Director and Administrative Services Agreement as if such agreement were
in full force and effect. Subject to compliance with applicable rules of the
State of New York, NYDM shall provide the services under this Agreement as are
set forth in Section 4 of the Medical Director and Administrative Services
Agreement by and between Hospital and EDS, which is attached to the Medical
Asset Purchase Agreement, unless the provision of such services by NYDM is
prohibited by law or regulation, or such services already are being provided
hereunder, and NYDM shall comply with the quality assurance protocols set forth
in Section 7 of the Medical Director and Administrative Services Agreement by
and between Hospital and EDS, which is attached to the Medical Asset Purchase
Agreement.
5. The parties agree that Paragraph 9 of the Principal Management
Agreement shall be of no further force and effect with respect to any future or
subsequent sale of the Business (which shall be defined for purposes hereof as
defined in the Agreement to Amend and shall also include other dialysis
facilities developed pursuant to this Amendment No. 3 and the Operating
Agreement by and between Hospital and EDS, which is attached to the Medical
Asset Purchase Agreement by and between Hospital and EDS, dated as of the date
hereof).
6. So long as the Principal Management Agreement or the Administrative
Services Agreement (as hereinafter defined) is in effect, subject to the
following sentence, Hospital shall not enter into any agreement, arrangements,
understanding, or negotiations or discussions with any third parties with regard
to the sale of the Facilities or management of the Facilities by any parties
other than Hospital or NYDM. If Hospital has given NYDM a bona fide written
notice of termination of the Principal Management Agreement for a material and
egregious breach as provided herein, the preceding sentence shall not apply.
7. The following paragraphs are hereby added to the Principal Management
Agreement:
"19. The parties agree that notwithstanding anything herein to the
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contrary, this Agreement shall terminate and be of no further force and
effect upon the closing of that certain Medical Asset Purchase Agreement by
and between Hospital and Everest Dialysis Services, Inc. ("EDS") (the
"Medical Asset Purchase Agreement"). The parties agree that
notwithstanding anything herein to the contrary, this Agreement may be
terminated by either party "for cause" only in accordance with the
following provisions:
A. If a party desires to terminate this Agreement for cause, it
shall first give written notice (the "Breach Notice") to the breaching
party, of its intention to terminate the agreement for cause
describing in reasonable detail the material and egregious breach.
B. For purposes of this Agreement, "cause" shall mean only a
material and egregious breach which, with respect to Hospital, means
(i) a material breach by it of the non-competition provision set forth
in Section 3 of the Agreement to Amend, (ii) a material breach by it
of its obligations to provide Medical Director Services pursuant to
Section 4 of this Amendment No. 3, (iii) a material breach by Hospital
of its covenants as set forth in Section 5 of the Agreement to Amend,
or (iv) a material failure of Hospital to remit to NYDM or EDS any
amounts received with respect to accounts receivable pursuant to any
contractual obligations to NYDM or EDS which Hospital may have, in
each case which breach is continuing, and for which Hospital has
failed to take diligent actions to cure as promptly as possible, and,
with respect to NYDM, means a material breach by it of its obligations
(i) to comply with the quality assurance protocols set forth in
Section 7 of the Medical Director and Administrative Services
Agreement by and between Hospital and EDS, which is attached to the
Medical Asset Purchase Agreement; (ii) to develop the dialysis
facilities on behalf of Hospital upon the terms and conditions as set
forth in Section 2 of the Operating Agreement attached to the Medical
Asset Purchase Agreement; or (iii) to pay to Hospital or offset from
the fees payable from Hospital to NYDM the compensation that would
otherwise be paid to Hospital pursuant to Section 6 of the Medical
Director and Administrative Services Agreement as if such agreement
were in full force and effect, in each case which breach is
continuing, and for which NYDM has failed to take diligent actions to
cure as promptly as possible.
C. If the material and egregious breach described in the Breach
Notice has not been cured within sixty (60) days of the breaching
party's receipt of such notice, or if the breach cannot be cured
within sixty (60) days and the breaching party is not taking diligent
actions to cure the breach as promptly as reasonably possible, the
non-breaching party may give a notice of termination for cause
whereupon this Agreement shall be terminated for
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cause upon the breaching party's receipt of such notice.
D. Any termination for reasons other than a material and
egregious breach or as a result of an order, ruling, or regulation
issued by the New York Public Health Council or the New York
Department of Health shall be considered for purposes of this
Agreement as a termination without cause by the terminating party.
E. In the event a party breaches this Agreement and the breach
is not a material and egregious breach as defined herein, the non-
breaching party shall not have the right to terminate this Agreement
other than without cause, but nevertheless shall have all other rights
at law or in equity, which it may exercise in the event the breaching
party has not cured the breach within sixty (60) days of receipt of
written notice from the non-breaching party describing in reasonable
detail the breach, or if the breach cannot be cured within sixty (60)
days, if the breaching party is not taking diligent actions to cure
the breach as promptly as reasonably possible.
"20. In the event this Agreement must be terminated or not renewed or
extended as a result of an order, ruling, or regulation issued by the New
York Public Health Council or the New York Department of Health, and the
parties also are unable to enter into the Administrative Services and
Consulting Agreement in the form attached hereto as Exhibit A (the
"Administrative Services Agreement") as a result of an order, ruling, or
regulation issued by the New York Public Health Council or the New York
Department of Health, then:
(i) on the date of termination or expiration of this
Agreement, (A) Hospital shall pay to NYDM an amount equal to the
sum of (x) twenty three million two hundred ten thousand dollars
($23,210,000) reduced in equal monthly amounts pro rata over two
hundred forty (240) months for each month elapsed from the date
of this Amendment No. 3 to the date of termination or expiration,
(y) the depreciated value of all tangible assets of the Business
then held by NYDM (provided, however, that such obligation by
Hospital to pay for such tangible assets shall apply to tangible
assets acquired after the date of this Amendment No. 3 with a
value at the time of acquisition by NYDM in excess of one hundred
thousand dollars ($100,000) only if Hospital shall have given its
prior written consent to such acquisition, which consent shall
not be unreasonably withheld) as reflected in its financial
statements in accordance with generally accepted accounting
principles ("GAAP") (the depreciated value referenced in this
item (y) shall be referred to herein as the "Depreciated Book
Value"), (B) NYDM shall transfer to Hospital, free and clear of
any encumbrances, all tangible assets of the Business then held
by
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NYDM and all contracts, leases, and agreements relating thereto
(provided, however, that Hospital shall be obligated to assume,
and NYDM shall assign, only such contracts, leases, or agreements
entered into by NYDM after the date of this Amendment No. 3 (i)
in the normal course of business and if terminable upon no more
than 90 days notice without any liability or (ii) if Hospital
shall have given its prior written consent to the entering into
of such contract, lease, or agreement, which consent shall not be
unreasonably withheld) and Hospital shall (a) assume all
obligations thereunder which are to be performed after the
transfer thereof and (b) reimburse NYDM for any deposits and pre-
paid expenses under such contracts, leases, or agreements;
provided, further however, that NYDM shall indemnify and hold
harmless Hospital for any liability under any of the
aforementioned contracts, leases, or agreements accruing or
arising prior to the date of termination or expiration of this
Agreement, and (C) the Medical Asset Purchase Agreement and the
Agreement to Amend shall be terminated, and the parties shall
have no obligations to each other thereunder for obligations
required to be performed after the time of such termination
(provided such termination shall not relieve them of liability
for indemnification or to perform obligations required to be
performed thereunder prior to such termination);
(ii) from and after the date of termination or expiration of
this Agreement, Hospital and NYDM shall collect all accounts
receivable for goods and services provided through the Business
and accrued through the date of termination or expiration and
remit to NYDM, promptly upon receipt, any and all amounts
received by Hospital in connection with such accounts receivable;
(iii) from and after the date of termination or expiration
of this Agreement, NYDM shall pay, in the ordinary course, all
accounts payable for the Business accrued through the date of
termination or expiration; and
(iv) in the event that Hospital, within two (2) years after
the date of termination or expiration of this Agreement pursuant
to this Section 20, sells all or substantially all of the
Business or the assets related thereto, or otherwise transfers
the economics of the Business, directly or indirectly, or enters
into a legally binding agreement to do the same, whether in
connection with a single transaction or a series of related or
unrelated transactions, for an aggregate purchase price in excess
of the amount received by
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NYDM in accordance with subparagraph (i)(A) above, then Hospital
shall pay fifty percent (50%) of such excess to NYDM promptly
after the receipt thereof. Hospital shall provide NYDM with
copies of any agreement relating to any such sale of the Business
or the assets related thereto or transfer of the economics of the
Business.
The provisions contained in subparagraphs (ii), (iii) and (iv) shall
survive the termination or expiration of this Agreement, as applicable, as
provided for in this Paragraph 20.
"21. In the event Hospital terminates this Agreement without cause
any time prior to the date forty (40) years from the Consideration Payment
Date or fails to extend the term of this Agreement upon expiration of the
fourth three-year term or any subsequent term which ends prior to the date
forty (40) years from the Consideration Payment Date, the following
provisions shall apply:
A. NYDM may elect, at it option, that as a condition to and
effective upon termination or expiration, Hospital and NYDM shall
enter into the Administrative Services Agreement.
B. (x) In the event the parties are unable to enter into the
Administrative Services Agreement as a result of an order, ruling, or
regulation issued by the New York Public Health Council or the New
York Department of Health, or (y) in the event that NYDM elects that
the parties shall not enter into the Administrative Services Agreement
as set forth in 21.A. above, then:
(i) as a condition to and on the date of termination or
expiration of this Agreement (A) Hospital shall pay to NYDM an
amount equal to the sum of (x) twenty three million two hundred
ten thousand dollars ($23,210,000), (y) the Depreciated Book
Value, and (z) the organizational, pre-opening, and start-up
costs for each dialysis facility developed on behalf of Hospital
upon the terms and conditions as set forth in Section 2 of the
Operating Agreement which could be eligible for capitalization
under GAAP as in effect on July 17, 1998, but prior to and
without giving effect to the adoption of SOP 98-5, reduced in
equal monthly amounts pro rata over two hundred forty (240)
months for each month elapsed from the date of the opening of
such facility, (B) NYDM shall transfer to Hospital, free and
clear of any encumbrances, all tangible assets of the Business
then held by NYDM and all contracts, leases, and agreements
relating thereto (provided, however, that Hospital shall
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be obligated to assume, and NYDM shall assign, only such
contracts, leases, or agreements entered into by NYDM after the
date of this Amendment No. 3 (i) in the normal course of business
and if terminable upon no more than 90 days notice without any
liability or (ii) if Hospital shall have given its prior written
consent to the entering into of such contract, lease, or
agreement, which consent shall not be unreasonably withheld) and
Hospital shall (a) assume all obligations thereunder which are to
be performed after the transfer thereof and (b) reimburse NYDM
for any deposits and pre-paid expenses under such contracts,
leases, or agreements; provided, further however, that NYDM shall
indemnify and hold harmless Hospital for any liability under any
of the aforementioned contracts, leases, or agreements accruing
or arising prior to the date of termination or expiration of this
Agreement, and (C) the Medical Asset Purchase Agreement and the
Agreement to Amend shall be terminated, and the parties shall
have no obligations to each other thereunder for obligations
required to be performed after the time of such termination
(provided such termination shall not relieve them of liability
for indemnification or to perform obligations required to be
performed thereunder prior to such termination);
(ii) from and after the date of termination or expiration of
this Agreement, Hospital and NYDM shall collect all accounts
receivable for goods and services provided through the Business
and accrued through the date of termination or expiration and
remit to NYDM, promptly upon receipt, any and all amounts
received by Hospital in connection with such accounts receivable;
(iii) from and after the date of termination or expiration
of this Agreement, NYDM shall pay, in the ordinary course, all
accounts payable for the Business accrued through the date of
termination or expiration; and
(iv) in the event that Hospital, within two (2) years after
the date of termination of this Agreement by Hospital without
cause or expiration of this Agreement pursuant to this Section
21, sells all or substantially all of the Business or the assets
related thereto, or otherwise transfers the economics of the
Business, directly or indirectly, or enters into a legally
binding agreement to do the same, whether in connection with a
single transaction or a series of related or unrelated
transactions, for an aggregate purchase price in excess of the
amount received by NYDM in accordance with subparagraph
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(i)(A) above, then Hospital shall pay fifty percent (50%) of such
excess to NYDM promptly after the receipt thereof. Hospital shall
provide NYDM with copies of any agreement relating to any such
sale of the Business or the assets related thereto or transfer of
the economics of the Business.
The provisions contained in subparagraphs (ii), (iii) and (iv) shall
survive the termination or expiration of this Agreement, as provided for in
this Paragraph 21.
"22. In the event Hospital terminates this Agreement without cause any time
after the date forty (40) years from the Consideration Payment Date or fails to
extend the term of this Agreement upon expiration of any term which ends after
the date forty (40) years from the Consideration Payment Date, the following
provisions shall apply:
(i) as a condition to and on the date of termination or
expiration of this Agreement (A) Hospital shall pay to NYDM an
amount equal to the Depreciated Book Value, (B) NYDM shall
transfer to Hospital, free and clear of any encumbrances, all
tangible assets of the Business then held by NYDM and all
contracts, leases, and agreements relating thereto (provided,
however, that Hospital shall be obligated to assume, and NYDM
shall assign, only such contracts, leases, or agreements entered
into by NYDM after the date of this Amendment No. 3 (i) in the
normal course of business and if terminable upon no more than 90
days notice without any liability or (ii) if Hospital shall have
given its prior written consent to the entering into of such
contract, lease, or agreement, which consent shall not be
unreasonably withheld) and Hospital shall (a) assume all
obligations thereunder which are to be performed after the
transfer thereof and (b) reimburse NYDM for any deposits and pre-
paid expenses under such contracts, leases, or agreements;
provided, further however, that NYDM shall indemnify and hold
harmless Hospital for any liability under any of the
aforementioned contracts, leases, or agreements accruing or
arising prior to the date of termination or expiration of this
Agreement, and (C) the Medical Asset Purchase Agreement and the
Agreement to Amend shall be terminated, and the parties shall
have no obligations to each other thereunder for obligations
required to be performed after the time of such termination
(provided such termination shall not relieve them of liability
for indemnification or to perform obligations required to be
performed thereunder prior to such termination);
(ii) from and after the date of termination or expiration of
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this Agreement, Hospital and NYDM shall collect all accounts
receivable for goods and services provided through the Business
and accrued through the date of termination or expiration and
remit to NYDM, promptly upon receipt, any and all amounts
received by Hospital in connection with such accounts receivable;
and
(iii) from and after the date of termination or expiration
of this Agreement, NYDM shall pay, in the ordinary course, all
accounts payable for the Business accrued through the date of
termination or expiration.
The provisions contained in subparagraphs (ii) and (iii) shall survive
the termination or expiration of this Agreement, as provided for in this
Paragraph 22.
"23. In the event, and only in the event, Hospital terminates this
Agreement for cause due to a material and egregious breach by NYDM as
defined above, the following provisions shall apply as Hospital's sole
remedy for such breach, and Hospital shall have no other remedies for such
breach:
A. As a condition to and on the date of termination, (A)
Hospital shall pay to NYDM an amount equal to the the Depreciated Book
Value, (B) NYDM shall transfer to Hospital, free and clear of any
encumbrances, all tangible assets of the Business then held by NYDM
and all contracts, leases, and agreements relating thereto (provided,
however, that Hospital shall be obligated to assume, and NYDM shall
assign, only such contracts, leases, or agreements entered into by
NYDM after the date of this Amendment No. 3 (i) in the normal course
of business and if terminable upon no more than 90 days notice without
any liability or (ii) if Hospital shall have given its prior written
consent to the entering into of such contract, lease, or agreement,
which consent shall not be unreasonably withheld) and Hospital shall
(a) assume all obligations thereunder which are to be performed after
the transfer thereof and (b) reimburse NYDM for any deposits and pre-
paid expenses under such contracts, leases, or agreements; provided,
further however, that NYDM shall indemnify and hold harmless Hospital
for any liability under any of the aforementioned contracts, leases,
or agreements accruing or arising prior to the date of termination or
expiration of this Agreement, and (C) the Medical Asset Purchase
Agreement and the Agreement to Amend shall be terminated and the
parties shall have no further obligations to each other thereunder
(provided such termination shall not relieve them of liability for
indemnification or to perform obligations required to be performed
thereunder prior to such termination);
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B. From and after the date of termination, Hospital and NYDM
shall collect all accounts receivable for goods or services provided
through the Business and remit to NYDM, promptly upon receipt, any and
all amounts received by Hospital in connection with such accounts
receivable; and
C. From and after the date of termination, NYDM shall pay, in
the ordinary course, all accounts payable of the Business and accrued
through the date of termination or expiration.
The provisions contained in subparagraphs B. and C. shall survive the
termination of this Agreement as provided for in this Paragraph 23.
"24. In the event, and only in the event, NYDM terminates this
Agreement for cause due to a material and egregious breach by Hospital, as
defined above, any time prior to the date forty (40) years from the
Consideration Payment Date, the following provisions shall apply as NYDM's
sole remedy for such breach, and NYDM shall have no other remedies for such
breach:
A. on the date of termination of this Agreement, (A) Hospital
shall pay to NYDM an amount equal to (x) twenty three million two
hundred ten thousand dollars ($23,210,000), (y) the Depreciated Book
Value, and (z) the organizational, pre-opening, and start-up costs for
each dialysis facility developed on behalf of Hospital upon the terms
and conditions as set forth in Section 2 of the Operating Agreement
which could be eligible for capitalization under GAAP as in effect on
July 17, 1998, but prior to and without giving effect to the adoption
of SOP 98-5, reduced in equal monthly amounts pro rata over two
hundred forty (240) months for each month elapsed from the date of the
opening of such facility, (B) NYDM shall transfer to Hospital, free
and clear of any encumbrances, all tangible assets of the Business
then held by NYDM and all contracts, leases and agreements relating
thereto (provided, however, that Hospital shall be obligated to
assume, and NYDM shall assign, only such contracts, leases, or
agreements entered into by NYDM after the date of this Amendment No. 3
(i) in the normal course of business and if terminable upon no more
than 90 days notice without any liability or (ii) if Hospital shall
have given its prior written consent to the entering into of such
contract, lease, or agreement, which consent shall not be unreasonably
withheld) and Hospital shall (a) assume all obligations thereunder
which are to be performed after the transfer thereof and (b) reimburse
NYDM for any deposits and pre-paid expenses under such contracts,
leases, or agreements; provided, further however, that NYDM shall
indemnify and hold harmless
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Hospital for any liability under any of the aforementioned contracts,
leases, or agreements accruing or arising prior to the date of
termination or expiration of this Agreement, and (C) the Medical Asset
Purchase Agreement and the Agreement to Amend shall be terminated and
the parties shall have no further obligations to each other thereunder
(provided such termination shall not relieve them of liability for
indemnification or to perform obligations required to be performed
thereunder prior to such termination);
B. from and after the date of termination, Hospital and NYDM
shall collect all accounts receivable for goods and services provided
through the Business and remit to NYDM, promptly upon receipt, any and
all amounts received by Hospital in connection with such accounts
receivable; and
C. from and after the date of termination or expiration, NYDM
shall pay, in the ordinary course, all accounts payable of the
Business accruing through the date of termination or expiration.
D. In the event that Hospital, within two (2) years after the
date of termination of this Agreement by NYDM for cause due to a
material and egregious breach by Hospital pursuant to this Section 24,
sells all or substantially all of the Business or the assets related
thereto, or otherwise transfers the economics of the Business,
directly or indirectly, or enters into a legally binding agreement to
do the same, whether in connection with a single transaction or a
series of related or unrelated transactions, for an aggregate purchase
price in excess of the amount received by NYDM in accordance with
subparagraph (i)(A) above, then Hospital shall pay fifty percent (50%)
of such excess to NYDM promptly after the receipt thereof. Hospital
shall provide NYDM with copies of any agreement relating to any such
sale of the Business or assets related thereto or transfer of the
economics of the Business.
The provisions contained in subparagraphs B., C., and D. shall survive
the termination of this Agreement as provided for in this Paragraph 24.
"25. In the event NYDM terminates this Agreement for cause due to a
material and egregious breach by Hospital, as defined above, any time on or
after the date forty (40) years from the Consideration Payment Date, the
following provisions shall apply as NYDM's sole remedy for such breach, and
NYDM shall have no other remedies for such breach:
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A. as a condition to and on the date of termination of this
Agreement, (A) Hospital shall pay to NYDM an amount equal to the
Depreciated Book Value, (B) NYDM shall transfer to Hospital, free and
clear of any encumbrances, all tangible assets of the Business then
held by NYDM and all contracts, leases, and agreements relating
thereto (provided, however, that Hospital shall be obligated to
assume, and NYDM shall assign, only such contracts, leases, or
agreements entered into by NYDM after the date of this Amendment No. 3
(i) in the normal course of business and if terminable upon no more
than 90 days notice without any liability or (ii) if Hospital shall
have given its prior written consent to the entering into of such
contract, lease, or agreement, which consent shall not be unreasonably
withheld) and Hospital shall (a) assume all obligations thereunder
which are to be performed after the transfer thereof and (b) reimburse
NYDM for any deposits and pre-paid expenses under such contracts,
leases, or agreements; provided, further however, that NYDM shall
indemnify and hold harmless Hospital for any liability under any of
the aforementioned contracts, leases, or agreements accruing or
arising prior to the date of termination or expiration of this
Agreement, and (C) the Medical Asset Purchase Agreement and the
Agreement to Amend shall be terminated and the parties shall have no
further obligations to each other thereunder (provided such
termination shall not relieve them of liability for indemnification or
to perform obligations required to be performed thereunder prior to
such termination);
B. from and after the date of termination, Hospital and NYDM
shall collect all accounts receivable for goods and services provided
through the Business and remit to NYDM, promptly upon receipt, any and
all amounts received by Hospital in connection with such accounts
receivable; and
C. from and after the date of termination or expiration, NYDM
shall pay, in the ordinary course, all accounts payable of the
Business accruing through the date of termination or expiration.
The provisions contained in subparagraphs B. and C. shall survive the
termination of this Agreement as provided for in this Paragraph 25.
"26. Until the termination or expiration of this Agreement, the
parties shall continue to operate hereunder in the ordinary course of
business consistent with the past practices and customs of the parties.
"27. NYDM agrees that it shall develop the dialysis facilities on
behalf of Hospital upon the terms and conditions as set forth in Section 2
of the Operating
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Agreement attached to the Medical Asset Purchase Agreement, such facilities
shall be deemed "Facilities" as defined in the Principal Management
Agreement and all references therein to Facilities shall include such new
facilities; provided, however, that in the event Hospital unreasonably
withholds its consent to the entering into by NYDM of any material
contract, lease, or agreement, or the purchase by NYDM of any material
asset, necessary for the development of any such Facility, then NYDM shall
be relieved of its obligation to develop such Facility.
"28. NYDM and Hospital agree that they shall comply with the terms
and conditions as set forth in Section 3 of the Operating Agreement
attached to the Medical Asset Purchase Agreement until such time as this
Principal Management Agreement is terminated."
8. Except as amended by this Amendment No. 3, the provisions of the
Principal Management Agreement shall remain in full force and effect without
modification.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment No. 3
as of the date first herein above written.
MONTEFIORE MEDICAL CENTER NEW YORK DIALYSIS
MANAGEMENT, INC.
/s/ Xxxxxx X. Xxxxxxxxx /s/ Xxxxx X. Xxxxx
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Signature Signature
Xxxxxx X. Xxxxxxxxx Xxxxx X. Xxxxx
---------------------------------- ----------------------------------
Print Name Print Name
Executive Vice President-Corporate President
---------------------------------- ----------------------------------
Title Title
[Signature Page for Amendment No. 3 to the Agreement to
Provide Management Services for Dialysis Facilities by and between
Montefiore Medical Center and New York Dialysis Management, Inc.]
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Everest HealthCare Services Corporation hereby unconditionally guarantees
the full and complete performance by New York Dialysis Management, Inc., and all
of its successors and assigns, of its covenants and obligations hereunder.
EVEREST HEALTHCARE SERVICES
CORPORATION
/s/ Xxxxx X. Xxxxx
---------------------------------------
Signature
Xxxxx X. Xxxxx
---------------------------------------
Print Name
Chairman and Chief Executive Officer
---------------------------------------
Office or Title
July 17, 1998
---------------------------------------
Date
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Exhibit A
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CONSULTING AND ADMINISTRATIVE SERVICES AGREEMENT
BY AND BETWEEN
MONTEFIORE MEDICAL CENTER
AND
NEW YORK DIALYSIS MANAGEMENT, INC.
THIS CONSULTING AND ADMINISTRATIVE SERVICES AGREEMENT (the "Agreement") is
entered into as of the date set forth in Article IV.A by and between Montefiore
Medical Center, a not-for-profit corporation duly organized and validly existing
under the laws of the State of New York ("MMC"), and New York Dialysis
Management, Inc., a corporation duly organized and validly existing under the
laws of the State of New York ("NYDM").
WHEREAS, MMC currently owns and operates chronic outpatient dialysis
programs located at 0000 Xxxxxxx Xxxxxx, Xxxxx, Xxx Xxxx (Dialysis Center I),
0000 Xxxxxxx Xxxxxx, Xxxxx, Xxx Xxxx (Dialysis Center II), 0000 Xxxxxx Xxxx
Xxxxxx, Xxxxx, Xxx Xxxx, and 0000 Xxxxxxxxxxx Xxxx, Xxxxx, Xxx Xxxx, and NYDM
has agreed to develop chronic outpatient dialysis sites for MMC, which provide
hemodialysis, peritoneal dialysis, and continuous renal replacement therapies to
end stage renal disease ("ESRD") patients (collectively the "Programs" or the
"Business"); and
WHEREAS, NYDM, either directly or through its affiliates, provides
consulting services to ESRD programs, conducts research relating to the field of
nephrology, and has developed proprietary systems and techniques to enhance the
operation of ESRD programs; and
WHEREAS, prior to the effectiveness of this Agreement, MMC and NYDM were
parties to that certain Agreement to Provide Management Services for Dialysis
Facilities, as amended, (the "Management Agreement"), including Amendment No. 3
to the Management Agreement ("Amendment No. 3"); and
WHEREAS, MMC and NYDM are parties to that certain Agreement to Amend and
Not-to-Compete dated as of July 17, 1998 (the "Agreement to Amend"); and
WHEREAS, MMC desires to retain NYDM to provide certain consulting services
to the Programs, and NYDM desires to provide such services upon the terms and
conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual representations, warranties,
covenants and undertakings of the parties hereto, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto, intending to be legally bound, do hereby agree
as follows:
ARTICLE I.
RELATIONSHIP OF THE PARTIES
AND MISCELLANEOUS MATTERS
A. Appointment of NYDM. MMC engages NYDM, and NYDM accepts such
engagement, pursuant to the terms and conditions hereinafter set forth, to
perform or cause to be performed the consulting services relating to and
required by the Programs, as described in Article II (collectively, the
"Services").
B. Retention of Ownership and Control. MMC shall hold and maintain all
necessary licenses and approvals required to operate the Programs. The parties
acknowledge and agree that this Agreement is intended to be a consulting
agreement, and is not a delegation of MMC's responsibilities for the day-to-day
operations of the Programs to NYDM. Notwithstanding any other provision in this
Agreement, MMC, shall remain responsible for ensuring that all services provided
pursuant to this Agreement with respect to the Programs comply with all
applicable federal, state, and local laws, rules, regulations and ordinances,
and standards of accreditation, including, but not limited to, those regarding
the establishment and operation of health care facilities in New York. Any
powers and responsibilities not specifically delegated to NYDM through the
provisions of this Agreement are not granted to NYDM and remain the
responsibility of MMC. Specifically, notwithstanding anything in this Agreement
to the contrary, MMC's governing body shall retain for itself and shall not
delegate to NYDM:
1. The authority to hire and fire any of MMC's employees and all key
management employees of the Programs. Key management employees
include, but are not limited to, the facility administrator,
Medical Director(s), the Chief Executive Officer and the Chief
Financial Officer;
2. The authority to maintain and control the books and records of
the Programs;
3. The authority to dispose of assets of the Programs and to incur
any liabilities on behalf of the Programs;
4. The authority to adopt and enforce polices regarding the
operation of the Programs;
5. The responsibility for insuring that the Programs operate in
compliance with all laws.
The parties hereto intend that the relationship created by this Agreement shall
not constitute a management agreement as defined in 10 NYCRR (S)405.3(f). In
the event the New York Department of Health or other applicable agency or
department determines that any of the requirements or obligations contained in
this Agreement result in the creation of a management
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agreement as defined in 10 NYCRR (S)405.3(f), Article VII, B shall apply to this
circumstance.
C. Status of Parties. The parties are independent contractors that engage
in the operation of their own respective businesses. Neither party is, or is to
be considered, as the agent or employee of the other party for any purpose.
Neither party has authority to enter into contracts or assume any obligations
for the other party or to make any warranties or representations on behalf of
the other party except as specifically provided herein. Nothing in this
Agreement shall be construed to establish a relationship of co-partners or joint
venturers between the parties.
D. Practice of Medicine. The parties acknowledge and agree that NYDM is
not authorized or qualified to engage in any activity that may constitute the
practice of medicine. To the extent that any act or service herein required of
NYDM should be construed by a court of competent jurisdiction or any regulatory
or administrative body having oversight responsibilities regarding such
professional activities to constitute the practice of medicine, the requirement
to perform that act or service by NYDM shall be deemed waived and unenforceable.
E. Appointment of Medical Directors. MMC shall appoint Medical Directors
for its Programs to direct the medical activities of the various Programs and to
perform the duties as may be assigned from time to time by MMC and required
under the applicable regulations of the Medicare ESRD Program, 42 C.F.R.
(S)405.2161 and by 10 NYCRR (S)751. MMC agrees that it shall provide medical
director services to each of the Programs under this Agreement, providing those
services as set forth in Section 3 of the Medical Director and Administrative
Services Agreement (the "Medical Director and Administrative Services
Agreement") by and between MMC and Everest Dialysis Services, Inc. ("EDS"),
which is attached to the Medical Asset Purchase Agreement by and between MMC and
EDS (the "MAPA"), as if such agreement were in effect, unless the provision of
such services by MMC is prohibited by law or regulation and all subject to
compliance with applicable rules of the State of New York.
F. AECOM Non-Compete. MMC agrees that it shall enforce, at the request
of NYDM, and will not waive, amend, or terminate prior to their scheduled
expiration any non-competition provisions or restrictive covenants it may have
against the Xxxxxx Xxxxxxxx College of Medicine ("AECOM") pursuant to either
that certain Affiliation Agreement by and between MMC and AECOM or pursuant to
that certain Sale and Purchase Agreement dated July 1, 1991, as it relates to
the Baumritter facility, in each case only in accordance with the terms and
conditions of each such agreement as they are in effect on July 17, 1998. MMC
shall be responsible for all fees payable for medical director services under
the Affiliation Agreement. MMC agrees that it shall not support or assist in
any manner, directly or indirectly, the establishment or operation of any
clinical practice of nephrology at AECOM for so long as this Agreement is in
effect, and if MMC has any legal rights to prevent or impede AECOM from
establishing or operating such clinical practice of nephrology, MMC will
exercise those rights.
G. Discussions Regarding Sale or Management. So long as this Agreement
is in effect, subject to the following sentence, MMC shall not enter into any
agreement, arrangements,
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understanding, or negotiations or discussions with any third parties with regard
to the sale of the Business or management of the Business by any parties other
than MMC or NYDM. The preceding sentence shall not apply if MMC has given NYDM a
written notice of termination of this Agreement for a material and egregious
breach as provided herein or during the last year of the term, as set forth
herein.
ARTICLE II.
CONSULTING SERVICES
A. Scope of Services. NYDM shall provide to MMC certain administrative
and non-professional services described in this Article II. NYDM shall
provide the Services described herein, within MMC's treatment capacity, without
discrimination as to race, creed, color, religion, national origin, sex,
disability, sexual orientation or patients' source of payment.
B. Personnel; Employment. NYDM shall employ or arrange for the provision
of all personnel necessary to perform the functions identified in this Article
II; provided however, that the chief executive officer(s) and the chief
financial officer(s) of the Programs, and the Programs' medical directors and
facility administrators, shall be employed by MMC or shall provide services
pursuant to a contractual arrangement with MMC.
C. Equipment, Supplies and Facility Services. NYDM agrees to provide MMC
with all equipment reasonably necessary for the operation of the Programs. NYDM
shall pay, as a part of the budgeted expenses of the Programs, maintenance and
improvements, supplies, utility expenses (telephone, electric, gas, water)
normal janitorial services, refuse disposal, and all other similar costs
relating to the Programs. NYDM will assist in the selection of equipment and
supplies and will maintain all of the dialysis equipment of the Programs, in
accordance with NYDM's maintenance policies. NYDM shall assist in the
negotiation of vendor contracts and assist with the evaluation of alternate
proposals and bids submitted by various companies relating to the Programs.
NYDM shall assist in maintaining records of inventory and arrange for purchases
of necessary and appropriate supplies and equipment on behalf of MMC for the
Programs, including management information systems and related items. NYDM
shall process all approved invoices, and oversee correct payment and receipt of
goods. MMC shall be responsible for approving and executing all contracts and
purchases for equipment, supplies, and facility services after consultation with
NYDM. NYDM shall have no power or authority to incur any debt or liability of
any kind or nature on behalf of the Programs.
D. Medical Record Maintenance. NYDM shall assist MMC with the
organization and maintenance of the medical records reflecting services provided
to patients of the Programs in accordance with all applicable federal, state and
local laws and regulations; provided, however, that the medical records of the
Programs are and shall remain proprietary and confidential information of MMC,
and, in its maintenance of that information, NYDM shall at all times be subject
to the restrictions set forth in Article VI hereof.
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E. Billing and Collection. NYDM shall prepare and submit in the name of
MMC all bills for items and services provided by the Programs, and shall
administer controls and systems for the recording and collection of the revenues
of the Programs as follows:
1. NYDM shall verify patient eligibility, enrollment and termination
with respect to Medicare, Medicaid and other third party payor
programs, and shall respond to all billing inquiries from
patients, payors and physicians.
2. NYDM shall administer the charge structure of the Programs, over
which MMC retains authority.
3. NYDM shall administer collection policies for the Programs that
are reasonable, appropriate, and consistent with all applicable
laws, regulations, and third party payor requirements, as
applicable, it being understood that NYDM has no control over the
adoption of policies by MMC which relate to the delivery of
health care services to patients.
4. All payments and corresponding documents relating to claims for
items and services provided by the Programs shall be promptly
deposited in a designated bank account to which NYDM shall have
access and signatory authority (the "General Account"). MMC
shall remit all such payments received and copies of such related
documents to NYDM when they are deposited to enable NYDM to
provide assistance to MMC with respect to the payment by MMC of
the costs and expenses of operation of the Programs and the
Administrative Fee and other Expenses (as hereinafter defined),
and to perform NYDM's financial and accounting functions
hereunder. With respect to all payments, MMC shall enter into an
agreement with a depository bank designated by NYDM (in such
form as may be required by such bank) to cause the depository
bank to receive such payments into a lockbox account in the name
of MMC, negotiate such payments, and sweep the proceeds of such
account, on a daily basis, into the General Account. MMC shall
cooperate with NYDM's collection effort as reasonably requested
from time to time by NYDM, promptly remit to NYDM amounts
collected, and execute any documents reasonably necessary to
perfect NYDM's interests therein.
5. Nothing in this section grants NYDM authorization to in any way
dispose of MMC's assets without prior approval by and
authorization by MMC.
6. NYDM shall prepare, in the name of the Programs and for MMC's
signature, all cost reports, exception requests and other reports
and data necessary for obtaining appropriate reimbursement from
Medicare, Medicaid or other third party payors for the items and
services provided by
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the Programs.
7. NYDM shall provide regular written reports, not less than
monthly, to the Chief Executive Officer of MMC, or his/her
designee, regarding the consulting services provided hereunder.
F. Accounting and Financial Services. NYDM shall provide accounting and
financial services to MMC for its Programs, as follows:
1. NYDM shall assist MMC in developing an annual budget for the
Programs (the "Budget") with an estimate of the operating
revenues and expenses and capital expenditures for the Programs
for the year. The Budget shall contain an explanation of plans
and projections regarding the operations of the Programs,
utilization, services, staffing and other factors that may affect
the budget, MMC shall have the sole right to approve and amend
the Budget. Upon approval of the Budget by MMC, the parties
shall use their reasonable efforts to operate the Programs so
that actual expenses and revenues are consistent with the Budget.
2. NYDM shall prepare and submit to MMC monthly and year-to-date
comparative financial statements for MMC's Program, showing
actual revenues and expenses of the Program, which shall include
a report of utilization, an analysis of accounts receivable
activity and reasonable explanations of any variances from the
Budget.
3. NYDM shall administer financial and accounting systems for the
Programs, and shall use such accounting policies and procedures
for the Programs as are adopted by MMC.
4. NYDM shall, from the Programs' revenues received pursuant to
Article II.E, on behalf of MMC, provide assistance to MMC with
respect to, and shall administer the payment by MMC of, the costs
and expenses related to the operation of the Programs as set
forth in Article II.
5. The parties agree that the books and business records of the
Programs remain under the ownership and control of MMC at all
times, and that NYDM is functioning in an administrative capacity
in performing the foregoing. Notwithstanding the foregoing,
financial, purchasing, payroll and other records of NYDM (i.e.,
records related to NYDM's operation, such as NYDM's financial
statements and payroll records relating to NYDM's employees)
shall be and remain the property of NYDM.
G. Policies and Procedures. NYDM shall administer certain non-clinical
policies and
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procedures of the Programs, as adopted by MMC. MMC reserves the right to change
its Programs' policies, procedures and forms at any time, in its sole
discretion. Without limiting the foregoing, NYDM agrees to do the following:
1. To establish, modify, and implement through contract or otherwise
non-clinical policies and procedures concerning the
administration of the Programs including purchasing, personnel
staffing, inventory control, equipment maintenance, accounting,
legal, data processing, medical record keeping, laboratory,
billing, collection, public relations, insurance, cash
management, scheduling, and hours of operation.
2. Subject to Article IV.D hereof, to pay, or arrange to pay, all
wages, salaries, and other compensation, including social
security, unemployment, withholding, and all other taxes and
payroll deductions for any and all personnel of the Programs.
3. To maintain patient-to-staff ratios at the Programs consistent
with national averages for academic medical institutions that
have outsourced their dialysis programs to national vendors.
4. To conduct the Programs' reprocessing of dialyzers in accordance
with all applicable Medicare, AAMI, FDA, and other requirements.
5. To consult with the Medical Director(s) regarding the upgrading,
acquisition, maintenance, and replacement of all major medical
equipment (defined to mean medical equipment with a cost of
$5,000 or more) used at the Programs, including any dialysate
delivery system.
6. To make available to the Medical Director and nephrologists on a
monthly basis, without charge, and in a timely manner, a per-
patient record of the hemodialysis treatments performed, for the
expressed purpose that these are to be used by the physicians for
billing purposes.
H. Service Contracts. With the exception of those ancillary services set
forth in Schedule II.H, which will be provided to the Programs by MMC, NYDM
shall advise and assist MMC in negotiating and maintaining contracts and
arrangements with such individuals or entities appropriate for its Programs for
ancillary medical items and services (e.g., laboratory, blood, EKG, bone
densitometry, pharmacy, etc.), agreements for any other items and services
needed by its Programs, third-party payer contracts, transplant agreements,
affiliation agreements and related agreements for and in the name of the
Programs upon terms reasonably acceptable to NYDM. NYDM and its affiliates
shall be entitled to provide such services.
I. Operating Agreement. NYDM agrees that it shall develop the dialysis
facilities on
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behalf of MMC upon the terms and conditions as set forth in Section 2 of the
Operating Agreement attached to the Medical Asset Purchase Agreement, as if such
agreement were in effect, such facilities shall be deemed "Programs" as defined
in this Agreement and all references therein to Programs shall include such new
facilities; provided, however, that in the event MMC unreasonably withholds its
consent to the entering into by NYDM of any material contract, lease, or
agreement, or the purchase by NYDM of any material asset, necessary for the
development of any such facility, then NYDM shall be relieved of its obligation
to develop such facility. NYDM and MMC agree that they shall comply with the
terms and conditions as set forth in Section 3 of the Operating Agreement
attached to the MAPA until such time as this Agreement is terminated.
J. Quality and Utilization Controls. NYDM shall advise and assist MMC in
the performance of medical record audits and in conducting utilization review
and quality assurance/control programs and activities as necessary and
appropriate for the operation of the Programs.
K. Insurance. NYDM shall maintain insurance, or shall self-insure,
against liabilities arising out of the services provided by NYDM hereunder,
including, without limitation, general liability insurance covering all services
rendered by NYDM, in amounts of not less than one million dollars ($1,000,000)
per occurrence and three million dollars ($3,000,000) per year in the aggregate.
NYDM shall provide MMC with evidence of the foregoing insurance from time to
time upon request by MMC. NYDM shall immediately notify MMC of the lapsing,
cancellation of or any other material change in NYDM's insurance.
MMC shall maintain malpractice and liability insurance, whether self-
insured or purchased through an insurance carrier, of not less than one million
dollars ($1,000,000) per occurrence and three million dollars ($3,000,000) per
year in the aggregate to insure against MMC's acts done within the course and
scope of the performance of its duties under this Agreement. NYDM shall be an
additional insured on all such policies. MMC shall notify NYDM in the event
that it becomes aware of an adverse change in (i) the amount of insurance
coverage or (ii) any policy terms, or in the event of cancellation of such
policies.
L. Physical Facilities. NYDM shall provide MMC with physical space for
the Programs pursuant to written leases and shall pay all rents required by such
leases. Such leases shall be attached to this Agreement upon the effectiveness
of this Agreement.
ARTICLE III
COMPENSATION
A. Compensation for Administrative and Consulting Services. In
consideration of the provision of the services listed in Article II, Paragraphs
D, E, F, G, H, I, and J of this Agreement, MMC shall pay to NYDM, and NYDM shall
accept as full and sufficient compensation therefor, a monthly administrative
fee of fifty thousand dollars ($50,000) (the "Administrative Fee"),
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payable to NYDM in arrears on the last day of each month during the term of this
Agreement, subject to Article III.D below. The Administrative Fee shall be
payable to NYDM's address set forth in Section VII.K. NYDM and MMC acknowledge
and agree that, beginning on the first anniversary of this Agreement, they shall
meet annually to consider any adjustment to the Administrative Fee.
B. Other Expenses. In addition to the fees for the services rendered by
NYDM under this Agreement that are payable pursuant to Article III, Paragraph A
hereof, MMC shall reimburse NYDM for any and all direct and indirect expenses
incurred by NYDM for the services rendered pursuant to Article II, Paragraphs B,
C, I, and L, and any related fees or expenses ("Other Expenses"). Payment of
such Other Expenses shall be made by MMC to NYDM promptly, but no later than ten
(10) days after MMC's receipt of a monthly billing statement from NYDM with
respect to Other Expenses incurred during the preceding month, subject to
Article III.D below.
C. Equipment Lease. In addition to the fees and expenses set forth in
Article III, Paragraphs A and B hereof, MMC shall pay NYDM, subject to Article
III.D below, a monthly equipment lease payment in a reasonable amount which the
parties agree to negotiate in good faith in the event this Agreement becomes
effective.
D. Expenses of the Program. NYDM shall, on MMC's behalf, pay the
contractual obligations and operating expenses of the Programs, including the
expenses NYDM incurs under Article II in providing services to the Programs.
Expenses and obligations of the Programs shall be paid pursuant to the following
priority: (i) the fees owed to MMC for the Medical Director services provided at
each of the Programs at the rates set forth in Section 6 of the Medical Director
and Administrative Services Agreement by and between MMC and EDS (ii)
obligations owed to unrelated third parties, and (iii) the Administrative Fee,
Other Expenses, and payments due under the Equipment Lease. The amounts set
forth in sections A, B, and C shall be paid only out of and from the General
Account and no other source, and MMC shall have no obligation to fund or pay any
deficits or shortfalls by paying money into the General Account or otherwise,
and such deficits and shortfalls shall be the obligation of NYDM. To the extent
any amounts deposited in the General Account remain at the end of each month
after payment of all the foregoing obligations and operating expenses of the
Programs, such amounts shall be the sole property of NYDM.
E. Audit of Books and Records. NYDM and MMC each shall have the right,
at their sole cost and expense, and upon reasonable prior notice to the other
party, to audit the books and records maintained by the other party to verify
the costs and expenses of operating MMC's Programs.
F. Taxes. All business-related taxes arising out of the operation of the
Programs and relating to periods subsequent to the date hereof shall be an
expense of the Programs and paid pursuant to Section III.B. hereof.
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ARTICLE IV.
TERM AND TERMINATION
A. Term. This Agreement shall commence as of the termination of the
Management Agreement and in accordance with Amendment No. 3, and shall continue
for a period of forty (40) years (the "Term") from and after the Consideration
Payment Date under that certain Agreement to Amend, unless earlier terminated as
provided in Section B of this Article.
B. Termination. This Agreement may be terminated upon the occurrence of
the following events:
1. The parties agree that notwithstanding anything herein to the
contrary, this Agreement shall terminate and be of no further force
and effect upon the closing of the MAPA. The parties agree that
notwithstanding anything herein to the contrary, this Agreement may be
terminated by either party "for cause" only in accordance with the
following provisions:
a. If a party desires to terminate this Agreement for cause, it
shall first give written notice (the "Breach Notice") to the
breaching party, of its intention to terminate the agreement for
cause describing in reasonable detail the material and egregious
breach.
b. For purposes of this Agreement, "cause" shall mean only a
material and egregious breach which, with respect to MMC, means
(i) a material breach by it of the non-competition provision set
forth in Section 3 of the Agreement to Amend, (ii) a material
breach by it of its obligations to provide Medical Director
Services pursuant to Article 1.E of this Agreement, (iii) a
material breach by MMC of its covenants as set forth in Article
5 of the Agreement to Amend, (iv) a material failure of MMC to
remit to NYDM any amounts received with respect to accounts
receivable pursuant to any contractual obligations to NYDM it may
have to do so, (v) the adoption of a Budget, or amendment
thereof, by MMC pursuant to Article II, Paragraph F(1) of this
Agreement which would have the effect of reducing the amounts
payable to NYDM pursuant to Article III of this Agreement, and to
which NYDM objects in writing, (vi) the disposition of assets or
incurrence of any liabilities pursuant to Article I, Paragraph
B(3) of this Agreement to which NYDM objects in writing, or (vii)
the adoption of accounting policies and procedures by MMC in
accordance with Article II, Paragraph F(3) of this Agreement
different from those reasonably requested by NYDM, in each case
which breach is continuing, and for which
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MMC has failed to take diligent actions to cure as promptly as
possible, and, with respect to NYDM, means a material breach by
it of its obligations (i) to comply with the quality assurance
protocols set forth in Section 7 of the Medical Director and
Administrative Services Agreement by and between MMC and EDS,
which is attached to the Medical Asset Purchase Agreement; (ii)
to develop the dialysis facilities on behalf of MMC upon the
terms and conditions as set forth in Section 2 of the Operating
Agreement attached to the Medical Asset Purchase Agreement,
subject to the limitations set forth in II.I; or (iii) to pay to
MMC or offset from the fees payable from MMC to NYDM the
compensation that would otherwise be paid to MMC pursuant to
Section 6 of the Medical Director and Administrative Services
Agreement as if such agreement were in full force and effect, in
each case which breach is continuing, and for which NYDM has
failed to take diligent actions to cure as promptly as possible.
c. If the material and egregious breach described in the Breach
Notice has not been cured within sixty (60) days of the breaching
party's receipt of such notice, or if the breach cannot be cured
within sixty (60) days and the breaching party is not taking
diligent actions to cure the breach as promptly as reasonably
possible, the non-breaching party may give a notice of
termination for cause whereupon this Agreement shall be
terminated for cause upon the breaching party's receipt of such
notice.
d. Any termination for reasons other than a material and
egregious breach or as a result of an order, ruling, or
regulation issued by the New York Public Health Council or the
New York Department of Health shall be considered for purposes of
this Agreement as a termination without cause by the terminating
party.
e. In the event a party breaches this Agreement and the breach
is not a material and egregious breach as defined herein, the
non-breaching party shall not have the right to terminate this
Agreement, except without cause, but nevertheless shall have all
other rights at law or in equity, which it may exercise in the
event the breaching party has not cured the breach within sixty
(60) days of receipt of written notice from the non-breaching
party describing in reasonable detail the breach, or if the
breach cannot be cured within sixty (60) days, if the breaching
party is not taking diligent actions to cure the breach as
promptly as reasonably possible.
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2. In the event this Agreement must be terminated during the Term as
a result of an order, ruling, or regulation issued by the New York
Public Health Council or the New York Department of Health, then:
a. On the date of termination of this Agreement, (A) MMC shall
pay to NYDM an amount equal to the sum of (x) twenty three
million two hundred ten thousand dollars ($23,210,000) reduced in
equal monthly amounts pro rata over two hundred forty (240)
months for each month elapsed from the date of this Amendment No.
3 to the date of termination or expiration, (y) the depreciated
value of all tangible assets of the Business then held by NYDM
(provided, however, that such obligation by MMC to pay for such
tangible assets shall apply to tangible assets acquired after the
date of this Amendment No. 3 with a value at the time of
acquisition by NYDM in excess of one hundred thousand dollars
($100,000) only if MMC shall have given its prior written consent
to such acquisition, which consent shall not be unreasonably
withheld) as reflected in its financial statements in accordance
with generally accepted accounting principles ("GAAP") (the
depreciated value referenced in this item (y) shall be referred
to herein as the "Depreciated Book Value"), (B) NYDM shall
transfer to MMC, free and clear of any encumbrances, all tangible
assets of the Business then held by NYDM and all contracts,
leases, and agreements relating thereto (provided, however, that
MMC shall be obligated to assume, and NYDM shall assign, only
such contracts, leases, or agreements entered into by NYDM after
the date of this Amendment No. 3 (i) in the normal course of
business and if terminable upon no more than 90 days notice
without any liability or (ii) if MMC shall have given its prior
written consent to the entering into of such contract, lease, or
agreement, which consent shall not be unreasonably withheld) and
MMC shall (a) assume all obligations thereunder which are to be
performed after the transfer thereof and (b) reimburse NYDM for
any deposits and pre-paid expenses under such contracts, leases,
or agreements; provided further, however, that NYDM shall
indemnify and hold harmless MMC for any liability under any of
the aforementioned contracts, leases, or agreements accruing or
arising prior to the date of termination or expiration of this
Agreement, and (C) the MAPA and the Agreement to Amend shall be
terminated, and the parties shall have no obligations to each
other thereunder for obligations required to be performed after
the time of such termination (provided such termination shall not
relieve them of liability for indemnification or to perform
obligations required to be performed thereunder prior to such
termination);
b. from and after the date of termination or expiration of this
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Agreement, MMC and NYDM shall collect all accounts receivable for
goods and services provided through the Business and accrued
through the date of termination or expiration and remit to NYDM,
promptly upon receipt, any and all amounts received by MMC in
connection with such accounts receivable;
c. from and after the date of termination or expiration of this
Agreement, NYDM shall pay, in the ordinary course, all accounts
payable for the Business accrued through the date of termination
or expiration; and
d. in the event that MMC, within two (2) years after the date of
termination of this Agreement pursuant to this Article IV.B.2,
sells all or substantially all of the Business or the assets
related thereto, or otherwise transfers the economics of the
Business, directly or indirectly, or enters into a legally
binding agreement to do the same, whether in connection with a
single transaction or a series of related or unrelated
transactions, for an aggregate purchase price in excess of the
amount received by NYDM in accordance with subparagraph (i)(A)
above, then MMC shall pay fifty percent (50%) of such excess to
NYDM promptly after the receipt thereof. MMC shall provide NYDM
with copies of any agreement relating to any such sale of the
Business or the assets related thereto or transfer of the
economics of the Business.
e. The provisions contained in subparagraphs b, c, and d shall
survive the termination or expiration of this Agreement, as
applicable, as provided for in this Article IV.B.2.
3. Upon termination of this Agreement at the end of the Term:
a. as a condition to and on the date of termination of this
Agreement (A) MMC shall pay to NYDM an amount equal to the
Depreciated Book Value, (B) NYDM shall transfer to MMC, free and
clear of any encumbrances, all tangible assets of the Business
then held by NYDM and all contracts, leases, and agreements
relating thereto (provided, however, that MMC shall be obligated
to assume, and NYDM shall assign, only such contracts, leases, or
agreements entered into by NYDM after the date of this Amendment
No. 3 (i) in the normal course of business and if terminable upon
no more than 90 days notice without any liability or (ii) if MMC
shall have given its prior written consent to the entering into
of such
-13-
contract, lease, or agreement, which consent shall not be
unreasonably withheld) and MMC shall (a) assume all obligations
thereunder which are to be performed after the transfer thereof
and (b) reimburse NYDM for any deposits and pre-paid expenses
under such contracts, leases, or agreements; provided further,
however; that NYDM shall indemnify and hold harmless MMC for any
liability under any of the aforementioned contracts, leases, or
agreements accruing or arising prior to the date of termination
or expiration of this Agreement, and (C) the MAPA and the
Agreement to Amend shall be terminated, and the parties shall
have no obligations to each other thereunder for obligations
required to be performed after the time of such termination
(provided such termination shall not relieve them of liability
for indemnification or to perform obligations required to be
performed thereunder prior to such termination);
b. from and after the date of termination or expiration of this
Agreement, MMC and NYDM shall collect all accounts receivable for
goods and services provided through the Business and accrued
through the date of termination or expiration and remit to NYDM,
promptly upon receipt, any and all amounts received by MMC in
connection with such accounts receivable; and
c. from and after the date of termination or expiration of this
Agreement, NYDM shall pay, in the ordinary course, all accounts
payable for the Business accrued through the date of termination
or expiration.
d. the provisions contained in subparagraphs b and c shall
survive the termination or expiration of this Agreement, as
provided for in this Article IV, B, 3.
4. In the event, and only in the event, MMC terminates this
Agreement for cause due to a material and egregious breach by NYDM as
defined above, the following provisions shall apply as MMC's sole
remedy for such breach, and MMC shall have no other remedies for such
breach:
a. As a condition to and on the date of termination, (A) MMC
shall pay to NYDM an amount equal to the Depreciated Book Value,
(B) NYDM shall transfer to MMC, free and clear of any
encumbrances, all tangible assets of the Business then held by
NYDM and all contracts, leases, and agreements relating thereto
(provided, however, that MMC shall be obligated to assume, and
NYDM shall assign, only such contracts, leases, or agreements
-14-
entered into by NYDM after the date of this Amendment No. 3 (i)
in the normal course of business and if terminable upon no more
than 90 days notice without any liability or (ii) if MMC shall
have given its prior written consent to the entering into of such
contract, lease, or agreement, which consent shall not be
unreasonably withheld) and MMC shall (a) assume all obligations
thereunder which are to be performed after the transfer thereof
and (b) reimburse NYDM for any deposits and pre-paid expenses
under such contracts, leases, or agreements; provided further,
however, that NYDM shall indemnify and hold harmless MMC for any
liability under any of the aforementioned contracts, leases, or
agreements accruing or arising prior to the date of termination
or expiration of this Agreement, and (C) the MAPA and the
Agreement to Amend shall be terminated and the parties shall have
no further obligations to each other thereunder (provided such
termination shall not relieve them of liability for
indemnification or to perform obligations required to be
performed thereunder prior to such termination);
b. From and after the date of termination, MMC and NYDM shall
collect all accounts receivable for goods or services provided
through the Business and remit to NYDM, promptly upon receipt,
any and all amounts received by MMC in connection with such
accounts receivable; and
c. From and after the date of termination, NYDM shall pay, in
the ordinary course, all accounts payable of the Business and
accrued through the date of termination or expiration.
d. The provisions contained in subparagraphs B. and C. shall
survive the termination of this Agreement as provided for in this
Article IV, B, 4.
5. In the event, and only in the event, NYDM terminates this
Agreement for cause due to a material and egregious breach by MMC, as
defined above, the following provisions shall apply as NYDM's sole
remedy for such breach, and MMC shall have no other remedies for such
breach:
a. as a condition to and on the date of termination of this
Agreement, (A) MMC shall pay to NYDM an amount equal to (x)
twenty three million two hundred ten thousand dollars
($23,210,000), (y) the Depreciated Book Value, and (z) the
organizational, pre-opening, and start-up costs for each dialysis
facility developed
-15-
on behalf of MMC upon the terms and conditions as set forth in
Section 2 of the Operating Agreement which could be eligible for
capitalization under GAAP as in effect on July 17, 1998, but
prior to and without giving effect to the adoption of SOP 98-5,
reduced in equal monthly amounts pro rata over two hundred forty
(240) months for each month elapsed from the date of the opening
of such facility, (B) NYDM shall transfer to MMC, free and clear
of any encumbrances, all tangible assets of the Business then
held by NYDM and all contracts, leases and agreements relating
thereto (provided, however, that MMC shall be obligated to
assume, and NYDM shall assign, only such contracts, leases, or
agreements entered into by NYDM after the date of this Amendment
No. 3 (i) in the normal course of business and if terminable upon
no more than 90 days notice without any liability or (ii) if MMC
shall have given its prior written consent to the entering into
of such contract, lease, or agreement, which consent shall not be
unreasonably withheld) and MMC shall (a) assume all obligations
thereunder which are to be performed after the transfer thereof
and (b) reimburse NYDM for any deposits and pre-paid expenses
under such contracts, leases, or agreements; provided further,
however, that NYDM shall indemnify and hold harmless MMC for any
liability under any of the aforementioned contracts, leases, or
agreements accruing or arising prior to the date of termination
or expiration of this Agreement, and (C) the Medical Asset
Purchase Agreement and the Agreement to Amend shall be terminated
and the parties shall have no further obligations to each other
thereunder (provided such termination shall not relieve them of
liability for indemnification or to perform obligations required
to be performed thereunder prior to such termination);
b. from and after the date of termination, MMC and NYDM shall
collect all accounts receivable for goods and services provided
through the Business and remit to NYDM, promptly upon receipt,
any and all amounts received by MMC in connection with such
accounts receivable; and
c. from and after the date of termination or expiration, NYDM
shall pay, in the ordinary course, all accounts payable of the
Business accruing through the date of termination or expiration.
d. The provisions contained in subparagraphs B. and C. shall
survive the termination of this Agreement as provided for in this
Article IV.B.5.
-16-
ARTICLE V.
INDEMNIFICATION
A. NYDM Indemnification. NYDM shall indemnify, defend and hold harmless
MMC, its officers, directors, agents, and employees, from and against any and
all liability, suits, claims, losses and damages, and expenses in connection
therewith (including reasonable attorneys' fees), to the extent they arise from
any act or omission of NYDM, its officers, agents or employees during the
performance of and related to any of their activities under this Agreement.
B. MMC Indemnification. MMC shall indemnify, defend and hold harmless
NYDM and its officers, directors, agents and employees, from and against any and
all liability, suits, claims, losses and damages, and expenses in connection
therewith (including reasonable attorneys' fees), to the extent they arise from
any act or omission of MMC, its officers, agents and employees during the
performance of and related to any of their activities under this Agreement.
C. Notice of Claims. In the event that any party hereunder shall receive
any notice of any claim or proceeding against said party (the "Indemnitee") that
gives rise to rights of indemnification hereunder, the Indemnitee shall give the
other party (the "Indemnitor") prompt written notice thereof by prepaid
registered or certified mail, return receipt requested, and the Indemnitor shall
have the right to contest and conduct the defense of any action brought against
the Indemnitee at the Indemnitor's own expense provided, however, that if the
Indemnitor shall fail to notify the Indemnitee of the assumption of the defense
of any such action within twenty (20) days after the giving of such notice by
the Indemnitee, then the Indemnitee shall have the right to take any such action
it deems appropriate to defend, contest, settle, or compromise any such action
or assessment and claim indemnification as provided herein. If the Indemnitor
does defend any action for which Indemnification is claimed, the Indemnitee
shall be entitled to participate, at its own expense, in the defense of such
action, which defense, however, shall be conducted and managed by the
Indemnitor. Failure of the Indemnitee to notify the Indemnitor of any claim for
which it is entitled to indemnification hereunder shall not impair, limit, or
affect the indemnification provided herein so long as the ability of the
Indemnitor to contest, defend, or dispute such claim has not been materially and
adversely affected or the Indemnitor has not otherwise been prejudiced by such
failure.
D. Obligations Survive. The obligations of each party in this Article V
shall survive the termination or expiration of this Agreement.
ARTICLE VI.
COVENANTS
A. Nondisclosure of MMC's Proprietary Information. MMC acknowledges and
agrees that during the term hereof it shall have access to Confidential
Information (as defined below) and other proprietary information of NYDM
relating to the operation of ESRD programs
-17-
which shall be deemed to be confidential and MMC shall not, nor shall its
employees and agents, except as may be required by any lawful subpoena, court
order, legal process, or the New York State Department of Health, at any time
without NYDM's prior written consent: (i) disclose any such information to any
third party, or (ii) reproduce or utilize any such information in furtherance of
any other business venture. If MMC is required by lawful subpoena, court order
or legal process to disclose any Confidential Information or other proprietary
information of NYDM, MMC shall provide sufficient notice thereof to NYDM to
enable NYDM to seek a protective order or other appropriate legal or equitable
remedy to prevent such disclosure. For purposes of this Section VI.A., the term
"Confidential Information" shall mean the non-public information of NYDM, or any
entity with which NYDM contracts to provide any of the Services, including, but
not limited to, a formula, pattern, compilation, program, device, method,
system, technique, process, financial information, business strategy, or costing
data, etc. that (1) derives independent economic value, actual or potential,
from not being generally known to, and not being readily ascertainable by proper
means by, other persons who can obtain economic value from its disclosure or
use, or (2) is the subject of efforts that are reasonable under the
circumstances to maintain its secrecy. Confidential Information shall not
include information which: (i) is known to the receiving party prior to
receiving it from the other party, (ii) is generally known to the public, or
(iii) is disclosed to one party at any time by a third party who had the legal
right to disclose it or (iv) is independently developed by the other party in
compliance with law. The provisions of this Section VI.A shall survive
termination of this Agreement. Provided, however, that the foregoing
restrictions shall not limit or restrict MMC's ability or obligations to provide
patient medical records, billing records or similar information to any federal
or state agency or contractor.
B. Nondisclosure of NYDM's Proprietary Information. By virtue of MMC's
retention of NYDM, NYDM will have access to MMC's Confidential Information (as
defined below) and other proprietary information of MMC relating to the
operation of the Programs which shall be deemed to be confidential and NYDM
shall not, nor shall its employees and agents, except as may be required by any
lawful subpoena, court order, legal process, or the New York State Department of
Health, at any time without MMC's prior written consent: (i) disclose any such
information to any third party, or (ii) reproduce or utilize any such
information in furtherance of any other business venture. If NYDM is required
by lawful subpoena, court order or legal process to disclose any Confidential
Information or other proprietary information of MMC, NYDM shall provide
sufficient notice thereof to MMC to enable MMC to seek a protective order or
other appropriate legal or equitable remedy to prevent such disclosure. For
the purposes of the Section VI.B, "MMC Confidential Information" shall mean the
non-public information of MMC, including, but not limited to the methods,
systems, techniques, processes, formulas, business strategies, financial
information, patterns, compilations and programs pertaining to MMC's operation
of the Programs that (1) derives independent economic value, actual or
potential, from not being generally known to, and not being readily
ascertainable by proper means by other persons who can obtain economic value
from its disclosure or use, or (2) is the subject of efforts that are reasonable
under the circumstances to maintain its secrecy. MMC Confidential Information
shall not include information which: (i) is known to the receiving party prior
to receiving it from the other party, (ii) is generally known to the public, or
(iii) is disclosed to one party at any time by a third party who
-18-
had the legal right to disclose it or (iv) is independently developed by the
other party in compliance with law. The provisions of this Section VI.B shall
survive termination of this Agreement.
C. Reasonableness of Restrictions. The parties acknowledge that the
restrictions in this Article VI are reasonable and necessary to protect the
legitimate interests of NYDM and MMC, respectively and that any violation would
result in irreparable injury to the non-breaching party. The parties further
acknowledge that, in the event of a violation of any such restrictions which is
not remedied within fifteen (15) days after notice thereof, the non-breaching
party shall be entitled to preliminary and permanent injunctive relief without
having to prove actual damages or immediate or irreparable harm or to post a
bond. The non-breaching party shall also be entitled to an equitable accounting
of all earnings, profits and other benefits arising from such violation, which
rights shall be cumulative and in addition to any other rights or remedies to
which the non-breaching party may be entitled to at law or equity.
Notwithstanding the foregoing, if the restrictions specified in this Article VI
are adjudged unreasonable in any court proceeding, the parties hereby agree to
the reformation of such restriction by the court to such limits as it finds
reasonable, and the parties will not assert that such restrictions should be
eliminated in their entirety by such court.
D. Salaries. Each party to this Agreement shall remain liable for the
salary and benefits paid to such party's own employees, and shall be ultimately
responsible for compliance with the state and federal laws pertaining to
employment taxes, workers' compensation, unemployment compensation and other
employment-related statutes pertaining to the party's own employees involved in
the administration and day-to-day operation of the Programs.
ARTICLE VII.
MISCELLANEOUS
A. Exhibits and Schedules Incorporated by Reference. The Exhibits and
Schedules to this Agreement are referred to and made a part of this Agreement by
this reference as if set forth at length verbatim where reference is made to
them in this Agreement.
B. Change in Law. If there is a change in Medicare, Medicaid or other
Federal or State statutes or regulations or in the interpretation thereof, which
renders any of the material terms of this agreement unlawful or unenforceable,
this Agreement shall be amended by the parties hereto as a result of good faith
negotiations to the least extent necessary in order to carry out the original
intention of the parties in compliance with such law or regulation. In the
event the parties cannot amend this Agreement in order to bring this Agreement
into compliance with such statutes or regulations within fifteen (15) days after
either party provides the other with notice of such change and the need to amend
this Agreement, the parties shall submit the issue to arbitration according to
the following procedure. If the parties cannot agree upon an arbitrator, each
party shall appoint an arbitrator who in turn shall appoint a third arbitrator.
In the event, within thirty (30) days after the provision of notice set forth
above, the arbitrator cannot determine a permissible manner by which to
restructure this Agreement which maintains the general economic principles
contained herein,
-19-
this Agreement shall terminate, and the provisions of Article IV. B.2. shall
apply. In the event such law or regulation is subsequently amended or
interpreted in such a way to make any provision of this Agreement that was
formerly invalid valid, such provision shall be considered valid from the
effective date of such interpretation or amendment.
C. Approvals. Where the agreement, approval, acceptance or consent by
either party is required under this Agreement, such action shall not be
unreasonably delayed or withheld.
D. Assignment. Neither party shall have the ability to assign this
Agreement with the prior written consent of the other party, except that NYDM
may assign this Agreement to an affiliate without the prior written consent of
MMC.
E. Amendment. This Agreement may be amended only by a writing signed by
the party to be bound by such amendment.
F. Entire Agreement. This Agreement supersedes all agreements previously
made between the parties relating to its subject matter. There are no other
understandings or agreements between them with respect to the subject matter
hereof.
G. Confidentiality of Agreement. With the exception of any disclosure
required for review of this Agreement by the New York Department of Health, the
terms and conditions of this Agreement, as well as any documents or information
(not publicly available) provided in connection with the negotiation and
preparation of this Agreement, shall be maintained confidentially and shall not
be disclosed to any person, firm or entity except to such officers, directors,
trustees, employees and representatives of the parties (and of corporate
affiliates of the parties), as reasonably required for the purposes for which
such information is furnished, or as may be required by law.
H. Non-waiver. No delay or failure by a party to exercise any right under
this Agreement, and no partial or single exercise of that right, shall
constitute a waiver of that or any other right.
I. Headings. Headings in this Agreement are for convenience only and
shall not be used to interpret or construe its provisions.
J. Governing Law. This Agreement shall be construed in accordance with
and governed by the laws of the State of New York.
K. Access to NYDM's Books and Records. For a period of four (4) years
following the last date NYDM furnishes services pursuant to this Agreement, NYDM
shall make available, upon written request by the Secretary of the United States
Department of Health and Human Services ("HHS"),the Comptroller General of the
United States or any of their duly authorized representatives, all contracts,
books, documents and other records of NYDM which are necessary to
-20-
verify the nature and extent of the costs of NYDM's services hereunder.
L. Notice. Whenever notice must be given under the provisions of this
Agreement, such notice must be in writing and will be deemed to have been duly
given by (a) hand-delivery (with written confirmation of receipt) addressed to
the parties at their respective addresses set forth below; or (b) certified
mail, return receipt requested, postage prepaid, and addressed to the parties at
their respective addresses set forth below; or (c) telecopier (with written
confirmation of receipt), provided that a copy is mailed by registered mail,
return receipt requested, addressed to the parties at their respective addresses
set forth below, and provided further that notice shall be deemed given under
this subsection (c) when actually received by the recipient:
If to NYDM:
000 Xxxxx Xxxxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxx Xxxxx
Fax: (000) 000-0000
with a copy to:
Xxxxxx Xxxxxx & Xxxxx
000 Xxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000-0000
Attn.: Xxxx Xxxxx, Esq. and Xxxxxxx X. Xxxxx, Esq.
Fax: (000) 000-0000
and
Hinman, Straub, Xxxxxx & Xxxxxxx, P.C.
000 Xxxxx Xxxxxx
Xxxxxx, Xxx Xxxx 00000-0000
Attn: Ray Kolarsey, Esq.
Fax: (000) 000-0000
If to MMC:
000 Xxxx 000xx Xxxxxx
Xxxxx, Xxx Xxxx 00000
Attn: Xxxxxxx X. Xxxxxxxx, Esq.
Fax: (000) 000-0000
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with a copy to:
Green, Stewart, Xxxxxx & Xxxxxxxx, P.C.
0000 Xxxxxxxx Xxxxxx, X.X.
Xxxxx 0000
Xxxxxxxxxx, X.X. 00000
Attn: Xxxxxx X. Xxxxx, Esquire
Fax: (000) 000-0000
M. Compliance with Law. Notwithstanding any other provision in this
Agreement, MMC remains responsible for ensuring that the ownership and operation
of the Programs, and any Services provided pursuant to this Agreement comply
with all pertinent provisions of federal, state and local statutes, rules and
regulations.
N. Representation by Counsel. The parties agree that each have had the
benefit of representation by legal counsel in negotiating this Agreement. No
party is to be construed as the drafter of this Agreement for purposes of
determining the meaning of any provision of this Agreement, or for allocating
the benefit of any future ambiguity.
IN WITNESS WHEREOF, the parties have caused their duly authorized officers
to execute this Agreement.
MONTEFIORE MEDICAL CENTER NEW YORK DIALYSIS
MANAGEMENT, INC.
---------------------------- -------------------------------
Signature Signature
---------------------------- -------------------------------
Print Name Print Name
---------------------------- -------------------------------
Title Title
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Everest HealthCare Services Corporation hereby unconditionally guarantees
the full and complete performance by New York Dialysis Management, Inc., and all
of its successors and assigns, of its covenants and obligations hereunder.
EVEREST HEALTHCARE SERVICES
CORPORATION
--------------------------------
Signature
--------------------------------
Print Name
--------------------------------
Office or Title
--------------------------------
Date
-23-
