CORPORATE MANAGEMENT AGREEMENT
THIS CORPORATE MANAGEMENT AGREEMENT, dated this 21st day of May 1999
("Agreement"), is entered into by and between NewCare Health Corporation, a
Nevada corporation, and its affiliated companies and subsidiaries ("NewCare")
and Lenox Healthcare, Inc. a Massachusetts corporation ("Manager") (NewCare
and Manager are hereinafter also referred to collectively as "Parties").
WHEREAS, NewCare desires to have Manager manage some or all of its
corporate books, records and corporate operations;
AND WHEREAS, Manager is desirous of managing some or all of NewCare's
corporate books, records and corporate operations;
NOW THEREFORE, in consideration of the mutual and reciprocal covenants and
agreements set forth herein, and for other consideration acknowledged as
received,
the Parties agree as follows:
1. SCOPE OF ENGAGEMENT
1.1 Manager shall have authority and responsibility to manage
all aspects of NewCare's corporate operations as to each of the following:
Financial oversight, of and regarding NewCare's accounts receivable,
accounts payable, accounts payable and accounts receivable processing, bank
accounts, loans, loan payments, securing new loans or lines of credit (as to
all intended loans, securing new loans or lines of credit, the final form must
be approved by NewCare's Board of Directors);
All Facility matters of NewCare, including federal tax withholding,
other employee-related tax considerations, employee hiring and firing,
promotions, compensation, benefits, benefit plans, corporate policies toward
employees, compliance with EEOC, OSHA and other laws applying to NewCare
employees and their working environment; labor disputes and resolution;
NewCare's litigation and litigation files, but only to the extent
that it is related to Facility operations;
Document storage and retrieval of all Facility-related NewCare
documents, including confidential documents;
In consultation with NewCare, MIS, computer systems, technology and
equipment; storage and retrieval of NewCare information; any changes in such
systems, hardware and /or software components; networks and intra-company
sharing of information and software; computer and telephone inter- and
intra-office compatibility.
1.2 To the extent requested and directed by NewCare's Board of
Directors, Manager shall have the authority and responsibility to do some or
all of the following:
NewCare trademarks, service marks, copyrights, patents (if any),
trade secrets and proprietary information; protection and registration of such
intellectual property in the U.S. and in other countries, as may be
appropriate;
Marketing matters for NewCare, including any and all advertising and
promotions, including advertising and promotional budgets;
All real estate leases, licenses, purchases or sales of NewCare
property or property interests of any kind and wherever located;
Preparation of all corporate tax returns and payment of taxes due
and receipt of any refunds due; this shall include other duties, levies,
assessments or other impositions, whether local, state, federal, special or
otherwise; only Manager may file for and seek tax abatements or refunds on
real estate taxes or on other impositions;
All licensing and governmental approvals for all aspects of
NewCare's corporate operations; this responsibility shall include, but shall
not be limited to, all due diligence required in connection with filings
before the U.S. Securities and Exchange Commission, all due diligence required
in connection with Blue Sky registration, and the actual filing thereof (but
to be signed by an officer or officers of NewCare); Manager shall have similar
authority and responsibility with regard to any registrations necessitated
because of any contemplated or actual public offering or private offering by
NewCare; in addition, preparation of quarterly and annual reports shall be
undertaken, managed and coordinated by Manager, including the printing,
dissemination and filing thereof;
All matters normally performed by the Corporate Secretary or Clerk
of NewCare shall be performed by Manager, including annual and special
shareholder meetings, board of director meetings, minutes of such meetings and
dissemination of same; proxy preparation, dissemination and voting entries and
recordation; conduct of such meetings, including annual shareholder and board
of directors meetings;
Supervision and control of NewCare's litigation and litigation
files, not included under Section 1.1 (c) above.
1.3 In connection with the above-described authority and
responsibilities of Manager, NewCare hereby represents, warrants and agrees
that it shall fully assist Manager and cooperate with Manager on items
requested by NewCare to be handled by Manager.
1.4 The Parties agree that, as to the categories of services
under Section 1.2 (categories listed in subsections "a" through "g"),
NewCare's Board of Directors may, in its sole discretion, direct Manager to no
longer perform any particular category of services. Any services requested by
NewCare's Board of Directors under Section 1.2 must be reasonably requested in
advance ( at least 30 days' notice ) so as to allow Manager to perform such
services.
2. MANAGER'S AUTHORITY; NON-INTERFERENCE; INDEMNIFICATION
2.1 Manager has complete authority to carry out its obligations
hereunder without hindrance or interference from any officer or employee of
NewCare, unless otherwise stated in this Agreement, and Manager may in all
instances use its own reasonable discretion regarding matters within its
authority and areas of responsibility.
2.2 Manager is acting as agent of NewCare in performing its
obligations hereunder, in recognition of which NewCare hereby agrees to
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indemnify and hold Manager, its agents, employees, directors, and officers,
(jointly and severally, "Manager Indemnitees") harmless from and against any
and all liabilities, losses, costs, expenses, claims, damages, suits, actions
or proceedings ever suffered or incurred by Manager Indemnitees (including but
not limited to reasonable, actual attorneys' fees) of or in connection with
the proper performance of Manager's obligations and responsibilities hereunder
or actions taken by or on behalf of Manager pursuant to or in furtherance of
such obligations and responsibilities. This section shall survive the
expiration or sooner termination of this Agreement.
2.3 Manager hereby agrees to indemnify and hold Owner, its
agents, employees, directors, and officers (jointly and severally "Owner
Indemnitees") harmless from and against any and all liabilities, losses,
costs, expenses, claims damages, suits, actions or proceedings every suffered
or incurred by Owner Indemnitees (including but not limited to reasonable
attorneys' fees) of or in connection with Manager's or its employees' gross
negligence or willful misconduct in the performance of its duties hereunder.
This section shall survive the expiration or sooner termination of this
Agreement.
3. REIMBURSEMENTS
3.1 In addition and not in lieu of the management fee to which
Manager is entitled under the Management Services Agreement, but due and
payable at such time as said management fee, NewCare shall reimburse Manager
an amount equal to the actual costs associated with providing Manager's
services hereunder ("Corporate Management Reimbursement") provided, however,
that consulting costs shall not also be included in the calculation of the fee
pursuant to the Management Services Agreement. Such Corporate Management
Reimbursement shall be due and payable monthly in arrears. The Corporate
Management Fee shall include documented time spent by Manager's employees, and
by any outside consultants or agents, on NewCare matters pursuant to or in
furtherance of Manager's responsibilities under this Agreement.
3.2 NewCare grants Manager the right and authority to hire and
to direct in Manager's own discretion outside consultants, and NewCare agrees
to reimburse Manager for all expenses so incurred by Manager on behalf of
NewCare or in furtherance of the purposes of this Agreement for matters
performed by such outside consultants, including tax preparers, accountants,
attorneys or independent contractors deemed to be necessary by Manager in
Manager's reasonable discretion. Such reimbursement shall be made by Manager
on behalf of NewCare.
4. TERM
4.1 The effective date of this Agreement shall be the same as the
effective date of the management services agreement dated __________, 1999
between the Parties ("Management Services Agreement"); and this Agreement
shall expire or sooner terminate as of the time that said Management Services
Agreement expires or terminates.
5. MISCELLANEOUS PROVISIONS
5.1 Notices. All notices, requests, demands and other
communications required or permitted to be given or made under this Agreement
shall be in writing and shall be deemed to have been given (a) on the date of
transmission by facsimile, with proof of receipt thereof or (b) on the date
following the date of (i) deposit in the United States mail, postage prepaid,
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by registered or certified mail, return receipt requested, effective when
received or (ii) delivery to a nationally recognized overnight courier service
effective when received. In each case, it is to be addressed as follows, or
to such other address, person or entity as the Party shall designate by notice
to the other in accordance herewith;
If to Manager: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President and Chief Executive Officer
Lenox Healthcare, Inc.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax No. (▇▇▇) ▇▇▇-▇▇▇▇
If to Owner: NewCare Health Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: General Counsel
Fax No. (▇▇▇) ▇▇▇-▇▇▇▇
5.2 Waiver of Subrogation. Manager and NewCare each hereby
waive any rights of recovery against the other, or against the officers,
employees, agents and representatives of the other, for loss or damages to
such waiving Party's property or the property of others under its control,
where and to the extent that such loss or damage is insured against under any
insurance policy in force at the time of such loss or damage. Upon obtaining
the policies of insurance required hereunder, Manager and NewCare shall give
notice to the insurance carriers that the foregoing mutual waiver of
subrogation is contained in this Agreement.
5.3 Continued Liability of Parties. Unless otherwise expressly
stated, expiration or termination of the Term shall not relieve any Party
hereto of any of its liabilities and obligations hereunder that accrued prior
to expiration or termination of the Term.
5.4 Governing Law. This Agreement shall be construed and
enforced in accordance with, and the performance of its terms shall be
governed by, the laws of the State of Delaware, without giving effect to
conflict of laws principles.
5.5 Assignability. No Party shall assign any of its rights and
obligations under this Agreement without obtaining the prior consent of the
other Parties. Subject to the foregoing, the terms of this Agreement shall
inure to the benefit of, and shall be binding upon, the Parties hereto and
their respective successors and assigns.
5.6 Non-Waiver. No waiver by any Party hereto of any failure of
any other Party to keep or perform any provision, covenant or condition of
this Agreement shall be deemed to be a waiver of any preceding or succeeding
breach of the same or any other provision, covenant or condition. All rights
and remedies herein granted or referred to are cumulative. If any Party
resorts to any one remedy, it shall not be precluded from resorting to any
other right or remedy provided by law or in equity.
5.7 No Financial Responsibility by Manager. It is understood
and agreed that Manager shall have no responsibility or obligation of any kind
or nature to make any payments or to in any manner fund any payments or
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activities contemplated under this Agreement, including but not limited to,
those responsibilities and NewCare liabilities contemplated under Section 1.1
hereto except out of NewCare funds controlled by Manager.
5.8 Headings. The headings of this Agreement are inserted for
convenience only and are not to be considered in the interpretation of this
Agreement. They shall not in any way limit or expand the scope, or modify the
substance or context, of any section of this Agreement.
5.9 Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
5.10 Insurance. NewCare shall maintain director's and officer's
liability insurance, at its own expense, naming Manager's officers and
directors and others designated by Manager as named insureds with regard to
their performance of duties, obligations and responsibilities contemplated by
the terms of this Agreement.
5.11 Termination of Management Services Agreement. If the
Management Services Agreement terminates or is terminated pursuant to Section
6 of said Management Services Agreement, then this Agreement shall likewise
terminate as of such date; termination notice under the Management Services
Agreement may, but need not, mention termination of this Agreement in addition
to termination of the Management Services Agreement for said notice to be an
effective termination of both agreements.
5.12 No Conflict. NewCare hereby represents and warrants, for
itself and all affiliated entities, that there is nothing in its By-laws,
Charter, corporate books, records, corporate documents, licenses, resolutions
of its stockholders or Board of Directors, or contracts of any kind or nature
that contradict, invalidate or that are contrary to, any of the terms or
conditions of this Agreement, or that establish conditions precedent or
conditions subsequent to any of the terms or conditions of this Agreement,
other than anything which has been disclosed to Manager in writing prior to or
as of the date of this Agreement first above written.
5.13 Enforcement. If any Party seeks to enforce this
Agreement, the prevailing party in any lawsuit shall be entitled to receive
from the other Party its reasonable attorneys' fees, court costs, costs of
collection and reasonable expenses.
IN WITNESS WHEREOF, the Parties hereto have signed this Agreement as of
the date first above written.
LENOX HEALTHCARE, INC.
("Manager")
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President
NEWCARE HEALTH CORPORATION
("NewCare")
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
Its: Chairman
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