Exhibit 6(e)
MANAGEMENT SERVICES AGREEMENT
THIS MANAGEMENT SERVICES AGREEMENT ("Agreement") is made as of this
____day of __________ , 199__ , between Greenbriar Corporation, a Nevada
corporation, ("Manager"), and Residential Healthcare Properties, Inc., a
Nevada corporation ("Owner").
WHEREAS, Owner owns an assisted living facility consisting of ___ beds
and related amenities, located in ___________, and known as_____________
(hereinafter referred to as the "Facility");
WHEREAS, Manager is capable of managing the Facility to provide personal
and residential care services to the elderly.
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
APPOINTMENT OF MANAGER
1.1 Appointment of Manager. Owner hereby appoints Manager and Manager
hereby accepts appointment, subject to the terms and conditions of this
Agreement, as the sole and exclusive Manager for the daily operation and
management of the Facility.
1.2 Management Services. Manager shall provide those Management Services
set forth in the Agreement.
ARTICLE II
DEFINITIONS
The following terms shall have the following meanings when used in the
Agreement:
2.1 Affiliate. The term "Affiliate" shall mean any one or more
individuals or entities which control, are controlled by, or are under common
control with the Manager or Owner.
2.2 Agreement. The terms "Agreement" and "this Agreement" shall mean
this Management Services Agreement between Owner and Manager, and any amendments
thereto as may be from time to time agreed to in writing by the parties.
2.3 Commencement of Management Services. The term "Commencement of
Management Services" shall mean that date when this Agreement is executed.
2.4 Facility. The term "Facility" shall mean the assisted living facility
located in Lewiston, Idaho and, if incorporated by Owner, any other property
near or adjacent to the Facility which may be used in conjunction with the
Facility.
2.5 Facility Expense. The term "Facility Expense" shall mean an expense
directly related to the operating costs and staffing of the Facility, which
expenses and payment of expenses shall be administered by the Manager from
the Facility's income derived as further set forth herein.
2.6 Management Fee. The term "Management Fee" shall mean the fee
provided for in Article VI hereof.
2.7 Management Services. The term "Management Services" shall mean the
Managerial and personnel administration services described in Articles V,
VII, VIII, IX, X, and XIII hereof in particular, and in any other section of
this Agreement, all as are authorized and approved by Owner.
2.8 Manager. The term "Manager" shall mean Greenbriar Corporation, a
Nevada corporation, or its assigns as set forth in Article XIV, paragraph
14.9.
2.11 Operating Year. The term "Operating Year" shall mean the year
commencing on the date hereof.
2.12 Revenues. The term "Revenues" shall mean all monies received by
Manager from or on behalf of Residents and/or fees for ancillary services
provided to such Residents by Manager or Manager's employees, including any
community fee, with the exception of any pass-through fees and any escrow
monies held for the residents by the Manager. Any community fees or deposits
which are refunded to a resident shall be credited against revenues during
the month in which such refunds are made. Revenues shall also mean proceeds
from rental interruption insurance actually received and all applicable
miscellaneous revenues, such as that from vending machines.
2.13 State. The term "State" shall mean the State of ____, and any
regulatory agencies with overview authority or other authority over the
Facility, unless otherwise specifically indicated.
2.14 Term. The initial term of this Agreement shall be the period
beginning on the date this Agreement is executed and shall continue until
terminated as set forth in Article III below (the "Term").
ARTICLE III
TERMINATION OF AGREEMENT
3.1 Termination. Manager may terminate, subject to the provisions of
Section
4.4, if Owner defaults under any material provision of this Agreement
as set forth in Article IV and Article IX. Owner may terminate this Agreement
sooner if Manager defaults under any material provision of this Agreement as
set forth in Article IV. This Agreement may also be terminated sooner by
Owner without penalty if Manager causes, or through its omissions permits,
the licenses for operation of the Facility to at any time be suspended,
terminated or revoked resulting in cessation of operations for more than 30
days at the Facility. Owner may terminate this Agreement in the event of the
institution of bankruptcy proceedings on behalf of Manager.
If any of these events occur, Manager shall be entitled to any fees
provided for herein which are earned as of the date of termination subject to
any claims or offsets of Owner. Manager shall turn over to Owner all funds in
any account maintained by or on behalf of Owner. Manager shall turn over to
Owner all books and records relating to the Facility and all files relating to
the Facility.
3.2 Termination without Cause. Either party may terminate this Agreement
on 60-days prior written notice to the other.
ARTICLE IV
DEFAULTS
4.1 Default by Manager. Manager shall be deemed to be in default under
this Agreement in the event Manager shall fail to keep, observe or perform
any material covenant, agreement, term or provision of this Agreement to be
kept, observed or performed by Manager, and such default shall continue for a
period of ten (10) days after written notice thereof by Owner to Manager in
case of monetary defaults or for a period of thirty (30) days after written
notice thereof by Owner to Manager in the case of non-monetary defaults or,
if such non-monetary default cannot be cured within such thirty (30) day
period, then an additional thirty (30) day period, provided Manager is
capable of curing same, has proceeded to commence cure of such default within
said period, and thereafter diligently prosecutes the cure to completion.
4.2 Default by Owner. Owner shall be deemed to be in default hereunder
in the event Owner shall fail to keep, observe or perform any material covenant,
agreement, term or provision of this Agreement to be kept, observed or performed
by Owner and such default shall continue for a period of ten (10) days after
written notice thereof by Manager to Owner in case of monetary defaults or for a
period of thirty (30) days after written notice thereof by Manager to Owner in
the case of non-monetary defaults, or, if such default cannot be cured within
such thirty (30) day period, then an
additional period of thirty (30) days, provided that Owner is capable of curing
same, has proceeded to commence cure of such default within said period, and
therefore diligently prosecutes the cure to completion.
4.3 Remedies of Owner. Upon the occurrence of an event of default by
Manager as specified in Section 4.1 of this Agreement and expiration of any
applicable cure period provided by this Agreement, Owner shall be entitled to
terminate this Agreement, to remove Manager from the day-to-day management of
the Facility and replace Manager and otherwise to exercise all of its rights at
law or in equity.
4.4 Remedies of Manager. Upon the occurrence of an event of default by
Owner as specified in Section 4.2 of this Agreement and the expiration of any
applicable cure period provided by this Agreement, Manager shall be entitled to
terminate this Agreement and to exercise all of its rights at law or in equity.
4.5 No Waiver of Default. The failure of Owner or Manager to seek
remedy for any violation of, or to insist upon the strict performance of, any
term or condition of this Agreement shall not prevent a subsequent act by
Owner or Manager which would have originally constituted a violation of this
Agreement by Owner or Manager, from having all the force and effect of an
original violation. Owner or Manager may waive any breach or threatened
breach by Owner or Manager or any term or condition herein contained. The
failure by Owner or Manager to insist upon the strict performance of any one
of the terms or conditions of this Agreement or to exercise any right, remedy
or election herein contained or permitted by law shall not constitute or be
construed as a waiver or relinquishment for the future of such term,
condition, right, remedy or election, but the same shall continue and remain
in full force and effect. All rights and remedies that Owner or Manager may
have at law, in equity or otherwise for any breach of any term or condition
of this Agreement, shall be distinct, separate and cumulative rights and
remedies and no one of them, whether or not exercised by Owner or Manager,
shall be deemed to be in exclusion of any right or remedy of Owner or Manager.
4.7 Covenant of Owner. Owner shall fund the Facility consistent with the
funding described in the Approved Budget( as herein after defined).
ARTICLE V
DUTIES AND RIGHTS OF MANAGER
5.1 Management Services Duties. As Manager of the Facility, Manager
shall implement all aspects of the operation of the Facility in accordance
with the terms of
this Agreement, and shall have responsibility and
commensurate authority for all such activities. In addition to any other
duties set forth in this Agreement, Manager shall:
A. Enter into all contracts, leases and agreements required in the
ordinary course of business for the supply, operation, maintenance, service
and insurance of the Facility (including but not limited to food
procurement, trash removal, pest control and elevator maintenance) and,
subject to adequate funds being available, pay the costs of all such
services when due. Manager shall not: enter into any agreement, contract or
lease unless it is provided for in the Approved Budget, except that Manager
may enter into agreements not provided for in the Approved Budget which, in
the aggregate, impose monetary obligations on the Owner not in excess of
$5,000.00 in any one Operating Year or which are approved in writing by
Owner and for which Owner has provided sufficient fund to cover any
shortfall in the Approved Budget.
B. Purchase such inventories, provisions, food, supplies and other
expendable items as are necessary and consistent with the Approved Budget
to operate and maintain the Facility in a proper manner and store the same
at the Facility.
C. Maintain all permits, licenses and documentation necessary for
the operation of the Facility. Manager shall provide, at no additional cost
to Owner, all required preparation of documents, records and filings
necessary to acquire, maintain and renew all necessary licenses and permits
for the Facility and shall assist Owner in processing applications for such
licenses and permits. Any fees due for the filing of applicable licenses
shall be a Facility Expense.
D. Provide care to Residents of the Facility as provided for in the
resident agreement agreed to by the parties consistent with the Approved
Budget.
E. In addition to any specific obligations set forth herein, Manager
shall do all things necessary to manage and administer the day-to-day
operations of the Facility consistent with the Approved Budget.
5.2 Personnel Administration. The personnel at the Facility shall be
employed by Manager. Manager shall be responsible for recruiting, hiring,
training, promoting, assigning, supervising and discharging the personnel of
the Facility and shall be responsible for the formulation, implementation,
modification and administration of wage scales, rates of compensation,
employee insurance, employee taxes, in-service training, attendance at
seminars or conferences, staffing schedules, job
descriptions and personnel policies with respect to the personnel of the
Facility in accordance with the Approved Budget. Manager shall ensure that all
employees are properly licensed by the applicable authorities. All expenses of
Manager's employees utilized in managing the Facility, including but not limited
to salaries, wages, benefits, vacations, and employment taxes, shall be a
Facility expense and shall be paid by Owner in accordance with the Approved
Budget.
5.3 Purchasing. Manager shall use, on behalf of the Facility, such
purchasing systems and procedures developed by or otherwise available to
Manager for all items that are consistent with the Approved Budget. In
furtherance thereof, Manager shall utilize, to the extent that they offer
competitive prices, any national purchasing contracts that Manager may from
time to time have in effect with suppliers of equipment supplies provided
that the cost of such goods to the facility shall be no higher than the cost
paid by any other facility owned or managed by Manager or its affiliates.
Manager shall not enter into any purchase or service contract not generally
contained within the Approved Budget, without the prior written consent of
Owner. Any purchase by Manager made pursuant to or otherwise ancillary to
this Agreement and made in compliance with the terms of this Agreement shall
be made with Manager acting as agent for and at the expense of the Facility
or Owner. Manager shall indemnify and hold Owner harmless for any liabilities
or obligations arising from any purchase made by Manager which does not
comply with the Approved Budget or violate the conflict of interest
provisions set forth below. Manager shall fully disclose to Owner any
interest of Manager and/or Affiliate in any vendor and Manager shall
establish to Owner's reasonable satisfaction that the purchase or contract
was made after a competitive selection process and at a fair market price.
5.4 Leases. Manager shall submit any forms of resident agreements,
leases or other occupancy agreements used in the leasing of the Facility for
Owner's approval before they are used by Manager. Manager shall act as agent for
Owner in executing resident agreements, leases and occupancy agreements, but
Manager shall not enter into such agreement or lease for a duration of more than
one year without the prior consent of Owner. Manager will be responsible for
formulating and implementing procedures for all resident agreements, leases or
other occupancy agreements. All leases shall contain rents consistent with the
Approved Budget except as otherwise authorized by Owner in writing.
5.5 Maintenance and Repair. Manager shall make, install, or cause to be
made or installed, as a Facility Expense and in the name of Owner, all
necessary and
proper repairs, replacements, additions, and improvements in
and to the Facility, its furnishings and equipment, in order to best keep and
maintain the same in good repair, working order, and condition. Any repairs,
replacements, additions or improvements that Manager determines will exceed
the budgeted amounts in the Approved Budget shall be submitted to Owner for
prior approval.
ARTICLE VI
MANAGEMENT FEES
6.1 Management Services Fee.
A. Operating Period. During all Operating Years as compensation
for all services rendered by Manager in accordance with this Agreement
inclusive, Owner shall pay Manager on a monthly basis in arrears a
management fee equal to 6% of Revenues. The Manager shall be permitted to
withdraw the sums due from the Facility's account for such Fees on the
first day of each month based on Manager's estimated amount of such Fees
using the prior month's fee. After the close of each calendar month, the
Manager shall send Owner and the Owner's accountant an invoice for the
Management Fee payable under this subparagraph 6.1(A) for such month,
accompanied by supporting calculations and records showing Revenues, cash
receipts, and the number of Residents for such month. Owner shall have five
(5) days to object to the calculations in writing, by sending a notice to
Manager specifying the grounds for the objection. If Owner objects, the
parties shall resolve the dispute within five (5) days of the date of such
objection or submit the matter to binding arbitration pursuant to the
provisions of this Agreement.
B. No Other Compensation Due. Except for the compensation
described above, the Manager shall not be entitled to any other
compensation or reimbursement from the Owner for any Management Services to
be provided by Manager under this Agreement.
ARTICLE VII
OPERATING PROFITS, CREDITS AND COLLECTIONS, AND
PROCEDURE FOR HANDLING RECEIPTS AND OPERATING CAPITAL
7.1 Operating Profits. Manager shall be responsible for collecting all
revenues and fees billed to Residents and for paying Facility Expenses as
agreed in the Approved Budget. The Management Fee will be deducted from the
Revenues as a
Facility Expense.
7.2 Credits and Collections. Manager shall install credit and collection
policies and procedures, and Manager shall institute reasonable steps necessary
to effectuate monthly billing by the Facility, and the collection of accounts
and monies owed to the Facility. This also includes the institution of legal
proceedings in the name of Owner, Manager and/or the Facility, if necessary, and
authorized by Owner in writing after Manager has made its best efforts to
collect such accounts, and the enforcement of the rights of Owner as creditor
under any contract in connection with the rendering of any service or the
purchase of any goods. Any and all unreimbursed costs and/or fees charged by a
third party in connection with the collections and/or enforcement set forth in
this Section whose retention has been authorized by Owner shall be a Facility
Expense.
7.3 Depositories for Funds. Manager shall maintain accounts and
investments in such banks, savings and loan associations, and other financial
institutions as reasonably directed by Owner. These accounts shall be in the
Facility's name. Subject to the terms of this Agreement, including those
relating to the Approved Budget, Manager shall be authorized to access the
accounts without the approval of Owner. These accounts shall be segregated from
any other Manager's accounts and investments. Distributions shall be made to
Owner in the maximum amounts and with the maximum frequency permitted by the
applicable regulations and subject to the Approved Budget and any amendments
thereto. In the event this Agreement is terminated, Manager shall not make any
withdrawal or payment from any depository holding the Facility funds, and its
access to any Facility accounts shall be deemed irrevocably terminated.
ARTICLE VIII
FINANCIAL RECORDS
8.1 Accounting and Financial Records. Manager shall, at its own
expense, establish and administer accounting procedures and controls and
systems for the development, preparation and safekeeping of records and books
of accounting relating to the business and financial affairs of the Facility,
including payroll, accounts receivable and accounts payable, and shall
prepare a monthly profit and loss report for Owner within approximately
twenty (20) days of month end. Such records shall be on an accrual basis and
in accordance with generally accepted accounting principles and shall compare
monthly and year to date amounts with Approved Budgets. The Manager
will cooperate with the Owner's accountant in formulating accounting and
financial reporting procedures and at accountant's request, will furnish all
back-up documentation for profit and loss reports furnished hereunder.
8.2 Reports. In addition to the monthly profit and loss report, required
pursuant to Sections 7.1 and 8.1, Manager shall keep Owner informed as to the
financial status, condition, and operation of the Facility and as to any State
or local reporting requirements in connection with the licenses and permits
necessary for Manager to operate the Facility, with written reports and such
other or special reports as Manager may from time to time determine are
necessary. In addition, Manager shall provide Owner with all standard reports
which Manager usually generates at other facilities which it owns or operates.
8.3 Access. Owner shall have the right at all reasonable times, during
normal business hours, to audit, examine, and make copies of books of account
maintained by Manager with respect to the Facility. Such right may be exercised
through any agent or employee designated by Owner or by an independent public
accountant designated by Owner. Further, at the end of the Term of this
Agreement, or upon other termination of this Agreement, as provided herein,
originals of all books and records kept for the Facility, including all records
kept on electronic media, and accounts and funds belonging to the Facility, are
to be promptly delivered to Owner.
ARTICLE IX
BUDGET
Manager will prepare a draft annual operating budget based on Manager's
experience in operating similar facilities. The draft budget will be
presented to Owner thirty (30) days prior to the commencement of any term or
renewal term under this Agreement for Owner's approval which shall not be
unreasonably withheld. In the event Owner has not notified Manager of
Owner's objections within ten (10) days of commencement of the term to which
the draft budget applies, the budget will be deemed not approved. Upon
approval by Owner the draft budget or an approved revision thereof shall be
the Approved Budget for purposes of this Agreement. Mid-term adjustments
will be developed by Manager if experience is significantly different than
budgeted and a mid-term budget will be present to Owner for approval in the
same manner as the original budget
In the event either party believes that the Approved Budget for an
Operating Year should be modified, either may propose such a modification in
writing no later than
sixty (60) days before the commencement of such Operating Year.
ARTICLE X
OTHER FINANCIAL MATTERS
10.1 Employee Withholding. Manager shall comply with all applicable local,
State and Federal requirements concerning the withholding of taxes from employee
wages and sales taxes.
ARTICLE XI
INSURANCE
11.1 Insurance Coverage. Manager shall obtain and carry professional
liability insurance in its name for its operation of the Facility naming the
Owner and, if required, any Mortgagee as additional insured with a carrier
reasonably satisfactory to Owner licensed in the State of ____. Manager shall
also obtain liability insurance for Owner in Owner's name. Subject to the
provisions of any Mortgage for the Facility, Manager shall negotiate a
contract or contracts for, and keep in full force and effect, all policies of
property insurance of the type, extent, amount and cost of coverage which is
consistent with sound management of the Facility, insuring Owner, Manager and
the Facility against the risks customarily insured against for such a
facility. The cost of such insurance, including the Facility's share of
professional liability insurance, will be included in the Approved Budget as
a Facility Expense. Such insurance shall include coverage for building and
contents (full replacement value except excavation and foundation),
comprehensive general liability in the amount of at least $1,000,000 combined
single limit, overlying umbrella liability coverage in the amount of at least
$5,000,000, comprehensive automobile liability in the amount of at least
$1,000,000, statutory workers' compensation coverage in the amounts required
by applicable laws and business interruption, all of which coverage shall
name Manager and any lender as additional named insured to the extent their
interests may appear. Manager shall timely provide Owner with a certificate
or certificates issued by such insurers evidencing such insurance, which
certificate or certificates shall be cancelable only upon not less than
thirty (30) days prior written notice by the insurer to Manager and any
Lender, and all policies will be written so as to provide notice to Owner
prior to any action by the insurer to cancel the policy. Notwithstanding the
foregoing, unemployment and workers' compensation insurance for employees of
Owner shall be in Owner's name.
11.2 Waiver of Subrogation. Owner and Manager each waive any right of
recovery against each other for any claims that may be brought for any loss
which is covered by insurance upon or relating to the Facility and the
furnishings and equipment located at the Facility. This waiver of
subrogation shall be valid and binding only in the event it is recognized and
accepted by the insurance companies under the policies obtained pursuant to
this Agreement. Each party further agrees that its sole source of
reimbursement of loss or damages shall be the insurance proceeds of the
policies to be provided under this Agreement, and that the other party shall
not be liable for any damage or loss in excess of such insurance coverage.
ARTICLE XII
LEGAL ACTIONS, GOVERNING LAW, ARBITRATION,
LIABILITY OF MANAGER AND INDEMNITY
12.1 Legal Actions. Legal counsel for Manager and Owner shall cooperate
in the defense or prosecution of any action affecting the Facility. Manager
shall not institute or defend any legal action affecting the Facility without
Owner's consent. Manager shall immediately forward all legal notices to Owner
which relate to the Facility. Manager shall advise and assist Owner in
instituting or defending any legal or regulatory action affecting the
Facility, in the name of Facility, Owner and/or Manager. All legal fees and
disbursements paid pursuant to a retainer agreement approved by Owner shall
be a Facility Expense. Manager shall not be entitled to any additional
compensation for performing its obligations under this Section.
Notwithstanding the foregoing, neither Owner nor the Facility shall be
responsible for any legal fees, disbursements, costs, judgments or
settlements caused by acts or omissions of the Manager which constitute
negligence, willful misconduct, a breach of this Agreement, or a breach of
applicable laws or regulations; Manager will be responsible for such items.
Manager shall assist Owner to take the acts necessary to protest or litigate
to a final decision in any appropriate court or forum, as a Facility Expense,
any violation, order, rule, or regulation affecting the Facility, except if
such violation is due to the negligence or willful misconduct of Manager, in
which case Manager will bear the expense. No legal action or proceeding
brought against the Owner or the Facility may be settled without the approval
of Owner. Owner shall have the absolute right to settle any action or
proceeding brought against the Owner or the Facility on any terms.
12.2 Legal Fees and Costs. In the event either party elects to incur
legal expenses to enforce or interpret any provision of this Agreement
against the other party
to this Agreement, the prevailing party shall be entitled to recover such legal
expenses, including without limitation, reasonable attorney's fees, costs and
necessary disbursements, in addition to any other relief to which such party
shall be entitled.
12.3 Choice of Law and Venue. Whereas Manager's principal place of
business is in the State of Texas, and the Facility is located in the State of
____, the parties agree that this Agreement shall be governed by and construed
in accordance with the laws of Texas, which shall be the exclusive courts of
jurisdiction and venue for any litigation, special proceeding or other
proceeding between the parties that may be brought, or arise out of, or in
connection with, or by reason of this Agreement except for all arbitration
proceedings which shall be conducted in Dallas, Texas.
12.4 Liability of Manager.
A. Standard of Care. Manager agrees to exercise, with respect to
all services provided by Manager under or pursuant to this Agreement, due care,
skill, and diligence and shall take all actions necessary for the maintenance of
any license or permit required for the Facility.
B. Other Persons. Manager shall not be responsible for the acts or
omissions of any of Owner's other contractors or any subcontractor, or any
employees of Owner, or any persons representing Owner performing any services
for or in connection with the Facility.
C. Non-Recourse. In the event that Manager makes any claim against
Facility and Owner, Manager shall have no recourse to directors, officers,
employees, and shareholders of the Owner.
12.5 Indemnity. Manager will defend, indemnify and hold Owner harmless
from and against any claims, losses, expenses, costs, suits, actions,
proceedings, demands or liabilities that are asserted against, or sustained or
incurred by Owner because of Manager's breach of this Agreement or because of
legal actions or regulatory violations arising from Manager's negligence, fraud,
willful misconduct or acts or omissions which violate or cause the Facility to
violate any applicable law, regulation or ordinance or acts or omissions which
violate this Agreement. Further, Manager will defend, at its own expense, any
actions brought directly against Manager as a result of negligence in managing
and/or operating the Facility. The scope of the foregoing indemnities includes
any and all costs and expenses properly incurred in connection with any
proceedings to defend any indemnified claim, or to enforce the indemnity, or
both. Owner will defend, indemnify, and hold Manager harmless, from and against
any and all claims, expenses, losses, costs, suits, actions, proceedings,
demands, or
liabilities that are asserted against, or sustained or incurred by
Manager in connection with or related to the performance of Manager's duties
under this Agreement or otherwise within the scope of the agency established by
the parties to this Agreement, except this indemnity shall not apply to claims
arising from Manager's acts or omissions which constitute negligence, willful
misconduct, fraud, breach of applicable laws, regulations or ordinances or
breach of this Agreement. The scope of the foregoing indemnities includes any
and all costs and expenses properly incurred in connection with any proceedings
to defend any indemnified claim, or to enforce the indemnity, or both. Recovery
upon an indemnity contained in this Agreement shall be reduced dollar-for-dollar
by any applicable insurance collected by either Owner or Manager.
12.6 Arbitration. It is the mutual intent of the parties hereto to
establish procedures to facilitate the informal and inexpensive resolution of
any disputes arising under this Agreement by mutual cooperation and without
resort to litigation. Accordingly, any controversy, dispute, or claim arising
out of or relating to this Agreement shall be resolved in accordance with the
following procedures:
A. The parties shall first attempt to negotiate a mutually
satisfactory resolution to the dispute as follows:
(1) The complaining party shall write a description of the
alleged dispute, controversy, claim, or breach of contract (hereinafter
"Dispute") and send it to the other party by certified or registered mail. This
letter shall explain the nature of the Dispute and refer to the relevant section
of the Agreement upon which the Dispute is based. The complaining party shall
also set forth a proposed solution to the Dispute, including a specific time
frame within which the parties must act.
(2) The party receiving the letter must respond in writing
within ten (10) days with an explanation, including references to the relevant
parts of the Contract and a response to the proposed solution.
(3) Within ten (10) day of receipt of this response, the parties
must meet and discuss options for resolving the Dispute. The complaining party
must initiate the scheduling
of this resolution meeting.
B. If the parties are unable to satisfactorily resolve the Dispute
through negotiation, a mediation must be held within thirty (30) days of an
unsuccessful resolution meeting. The mediation will be held at the Dallas office
of Judicial Arbitration & Mediation Service, Inc. (J.A.M.S.). The complaining
party must contact J.A.M.S. to schedule the mediation. The parties may agree on
a jurist from the J.A.M.S. panel. If they are unable to agree, J.A.M.S. will
provide a list of three available jurists and each party may strike one. The
remaining jurist will serve as the mediator.
C. If the Dispute is not settled by mediation, the parties agree to
submit the Dispute to J.A.M.S. for binding arbitration. The parties may agree on
a jurist from the J.A.M.S. panel. The aggrieved party may initiate arbitration
by sending written notice of an intention to arbitrate by registered or
certified mail to all parties and to J.A.M.S. The notice must contain a
description of the Dispute, the amount involved, and the remedy sought. If the
parties are unable to agree on an arbitrator, J.A.M.S. will provide a list of
three available panel members and each party may strike one. The remaining
jurist will serve as the arbitrator. If the parties agree, the jurist that
serves as the mediator may serve as the arbitrator. If and when a demand for
arbitration is made by either party, the parties agree to execute a Submission
Agreement, provided by J.A.M.S., setting forth the rules and procedures to be
followed at the arbitration hearing. If the parties cannot agree on rules and
procedures to be followed at the arbitration hearing, the arbitrator shall
establish the rules and procedures. The parties agree that arbitration must be
initiated within one year after the claimed breach occurred and that the failure
to initiate arbitration within the one-year period constitutes an absolute bar
to the institution of any new proceedings. Any judgment or award entered by the
arbitrator may be entered on an ex parte basis in the Dallas County Courts or
any other court having jurisdiction over
the party against whom the award is entered and enforced according to the terms
of the judgment or award. The venue of all hearings shall be in Dallas, County,
Texas.
D. If J.A.M.S. does not exist at the time a Dispute arises in
connection with this Agreement, these provisions shall continue in full force
and effect, subject to the following changes: In the event the parties are
unable to agree upon a mediator or alternative mediation service, the mediation
provision shall become null and void. If the parties are then unable to agree
upon an arbitrator or alternative arbitration service, the arbitration
provisions of this Section shall be fully enforceable, with Dallas County Courts
having jurisdiction to appoint a single arbitrator to arbitrate the Dispute.
E. In the event it is necessary for any party hereto, or its
authorized representative, successor, or permitted assign, to institute suit or
begin arbitration proceedings in connection with this Agreement or the breach
thereof, the prevailing party in such suit or proceeding shall be entitled to
reimbursement for its reasonable costs, expenses, and attorneys' fees incurred,
including costs, expenses, and attorneys' fees incurred on appeal or in
enforcing any arbitration award or judgment.
F. Notwithstanding the foregoing, either party shall have the right
to appeal the award of any arbitrator in the event that such award is made
contrary to applicable law.
ARTICLE XIII
REGULATORY AND CONTRACTUAL REQUIREMENTS
13.1 Regulatory and Contractual Requirements. Manager shall cause all
things to be done in and about the Facility reasonably necessary to comply
with the requirements of any applicable constitution, statute, ordinance,
law, rule, regulation, or order of any governmental or quasi-governmental
regulatory body or agency, or board of fire underwriters respecting the use
of the Facility or the construction, maintenance, or operation thereof.
Manager shall take all necessary actions to maintain all federal, State and
county permits and licenses needed for its management. Manager shall keep its
corporate organization in good standing in the State and shall maintain all
corporate
permits and licenses required by the State.
ARTICLE XIV
MISCELLANEOUS PROVISIONS
14.1 Additional Assurances. The provisions of this Agreement shall be
self-operative and shall not require further agreement by the parties except
as may be herein specifically provided to the contrary; provided, however, at
the request of either party, the party requested shall execute such
additional instruments and take such additional acts as the requesting party
may deem necessary to effectuate this Agreement.
14.2 Consents, Approval and Discretion. Except as expressly provided
herein to the contrary, whenever this Agreement requires any consent or approval
to be given by either party or either party must or may exercise discretion, the
parties agree that such consent or approval shall not be unreasonably withheld
or delayed and such discretion shall be reasonably exercised, in good faith.
14.3 No Brokerage. Each party represents to the other that it has not
engaged a broker in connection with this transaction, and agrees to defend,
indemnify, and hold the other party harmless from any claim made by a broker
through the indemnifying party.
14.4 Notices. All notices, demands, consents, approvals, and requests
given by either party to the other hereunder shall be in writing and shall be
sent by hand, by overnight courier, or by registered or certified mail, postage
prepaid, to the parties at the following addresses:
Owner: Residential Healthcare Properties, Inc.
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Attn:_______________
Manager: Greenbriar Corporation
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Attention: ______________
or to such other address and to the attention of such other person as either
party may from time to time designate in writing. Notices shall be effective
upon receipt. Refusal to accept delivery shall constitute receipt.
14.5 Severability. If any term or provision of this Agreement or the
application
thereof to any person or circumstance is held to be invalid or
unenforceable for any reason, the remainder of this Agreement, or the
application of such term or provision to persons or circumstances other than
those as to which it is held invalid or unenforceable, shall not be affected
thereby, and each term and provision of this Agreement shall be valid and be
enforced to the fullest extent permitted by law.
14.6 Gender and Number. Whenever the context of this Agreement requires,
the gender of all words herein shall include the masculine, feminine, and
neuter, and the number of all words herein shall include the singular and
plural.
14.7 Division and Headings. The divisions of this Agreement into
sections and subsections and the use of captions and headings in connection
therewith are solely for convenience and shall have no legal effect whatsoever
in construing the provisions of this Agreement.
14.8 Right to Perform. In the event that Owner or Manager shall fail to
perform any duty or fulfill any obligation hereunder to the material detriment
of the other, Owner or Manager, in addition to any rights or remedies available
to it under law, shall have the right, but not the obligation to perform any
such duty or fulfill any such obligation, but in no way obligating the party
beyond any termination period allowable hereunder.
14.9 Assignment by Manager. Manager shall not assign its rights or
obligations under this Agreement without Owner's consent which may be withheld
by Owner in its discretion, provided, however, Manager, shall have the right to
assign its rights and obligations under this Agreement to an Affiliate that is a
wholly-owned subsidiary of Greenbriar Corporation.
14.10 Assignment by Owner. Owner shall have the right to sell, lease and
convey the Facility, or any portion thereof, without the consent of Manager.
Any party to which the Facility, or any portion thereof, is conveyed shall
agree in writing to be bound by the terms of this Agreement and shall assume
Owner's obligations hereunder.
14.11 Entire Agreement/Amendment. With respect to the subject matter
hereof, this Agreement supersedes all previous contracts and constitutes the
entire Agreement between the parties, and no party shall be entitled to benefits
other than those specified herein. As between the parties, no oral statements or
prior written material not specifically incorporated herein shall be of any
force and effect. The parties specifically acknowledge that in entering into and
executing this Agreement, the parties rely solely upon the representations and
agreements contained in this Agreement and no others.
All prior representationsor agreements not expressly incorporated herein,
whether written or verbal, are superseded, and no changes in or additions to
this Agreement shall be recognized unless and until made in writing and signed
by both parties hereto. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed under seal by their duly authorized offices, all as of the day and year
first above written.
WITNESS/ATTEST:
Manager:
[signature] Greenbriar Corporation
By: [signature]
Name:
Title: President
WITNESS/ATTEST: Owner:
Residential Healthcare Properties, Inc.
[signature] By: [signature]]
Name:
Title: