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Exhibit 10.1 ASSIGNMENT AND ASSUMPTION
AGREEMENT This Assignment and
Assumption Agreement (the " Agreement ") is made and is
effective as of 11:59 p.m. the 31st day of December, 2008 (the
"Effective Date") by and between MedCath Partners, llc , a
North Carolina limited partnership (the "Assignor"), Cape Cod
Cardiac Cath, Inc. , a Massachusetts charitable corporation
(the "Assignee"), Cape Cod Hospital , a Massachusetts
charitable corporation ("the Hospital") solely for the obligations
of the Hospital expressly set forth herein and CAPE COD
CARDIOLOGY SERVICES, LLC , a North Carolina limited liability
company (the "Company"). All capitalized terms used herein and not
defined herein shall have the respective meanings ascribed to such
terms in that certain Operating Agreement of the Company dated as
of September 30, 2002, by and between the Assignee and the
Assignor (as amended, the "Operating Agreement").
WHEREAS , the Assignor and
the Assignee are the only members of the Company;
WHEREAS , pursuant to
Section 11.04 of the Operating Agreement the Assignee has
exercised its right to acquire, and the Assignor has agreed to
sell, transfer and assign to the Assignee, all of Assignor’s
right, title and interest as a member of the Company, representing
a fifty-one percent (51%) interest in the Company (the "Purchased
Interest"); WHEREAS , the
Assignee has agreed to assume all of the obligations of the
Assignor with respect to the Purchased Interest pursuant to the
Operating Agreement; and
WHEREAS , in connection with the transfer of the Purchased
Interest, the Assignee’s sole shareholder, the Hospital has
agreed to guarantee all of the Company’s obligations to the
Assignor pursuant to the Equipment Lease dated as of
October 20, 1995 by and between the Company (as successor to
Cape Cod Cardiology Services, L.P.), as lessee, and the Assignor,
as lessor (as amended from time to time including without
limitation as of the date hereof, the "Lease");
NOW, THEREFORE , for good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, subject to the terms of the Purchase
Agreement, the parties hereto hereby act and agree as follows:
1. Assignment . Subject
to the terms and conditions of this Agreement, Assignor hereby
assigns, transfers and sets over to the Assignee, effective from
and after the Effective Date, all of such Assignor’s existing
and future rights, title and interest of every nature in and to the
Purchased Interest, free and clear of any and all liens and
encumbrances. 2.
Assumption . Effective on and after the Effective Date, the
Assignee hereby accepts the foregoing assignment and assumes all of
the obligations and liabilities of Assignor with respect to the
Purchased Interest pursuant to the Operating Agreement.
Company agrees, and Assignee and
Hospital agree to cause Company, to pay all liabilities and
obligations of Company whether contingent or absolute, existing or
hereafter arising, known or unknown, disclosed or undisclosed, to
any third party as they come due and acknowledge that Assignor
shall have no liability or obligation therefore.
3. Purchase Price .
The parties hereby agree that the purchase price for the Purchased
Interest is $6,880,848.00 (the "Purchase Price"), payable in cash
by wire transfer on the Effective Date. Upon Assignor’s
receipt of the full amount of the Purchase Price from the Assignee,
Assignor shall acknowledge such payment in writing delivered to
Assignee. 4. Lease;
Guaranty . The parties acknowledge and agree that the Lease is
amended as follows: (a) attached hereto as
Exhibit A is a schedule of the equipment that is
covered by the Lease as of the Effective Date and the payment
schedule therefor, (b) the term of Lease shall continue with
respect to each Group of equipment shown on Exhibit A
for as long as lease payments are due with respect to such Group of
equipment, (c) Section 14 of the Lease is hereby amended
to permit either lessor or lessee to pledge their rights in the
Lease to lenders of such parties or their affiliates as collateral
for loans or other financing made to such parties by such lenders,
subject however to the rights of the other party to the Lease,
(d) Sections 17 and 18 are hereby deleted from the Lease,
(e) the notice address for lessor is 10720 Sikes Place,
Suite 300, Charlotte, NC 28277, Attention: President and
(f) Assignor is the lessor under the Lease. Except as set
forth above, the Lease remains in full force and effect
The Hospital hereby unconditionally
guarantees to Assignor all of the obligations and liabilities of
the Company pursuant to the Lease. This is a guarantee of payment
and not of collection. In the event that the Assignor is not paid
any amount when due under the Lease, Assignor may exercise all of
its rights and remedies directly against the Hospital as guarantor
without any requirement that it first exhaust or exercise any
rights and remedies against the Company.
5. Distributions; Advances;
Additional Amounts Due Assignor. In addition to the Purchase
Price, contemporaneously with the execution of this Agreement and
as a further condition to the effectiveness hereof, the Assignor
shall cause the Company to pay to Assignor the following amounts:
(a) $860,725.00 representing
Assignor’s estimated share of the Company’s
undistributed profits through November, 2008, it being agreed that
Assignor’s share of the Company’s undistributed profits
for December, 2008 shall be paid as part of the adjustment process
described at the end of this Section 5;
(b) $58,031.00 representing the lease
payments due under the Lease with respect to January, 2009;
(c) $77,085.00 representing an
estimate of the reimbursement for payroll and employee benefits due
to the Transferred Employees through December 27, 2008 to be
paid by Assignor on behalf of the Company, it being agreed that
Assignor also will pay payroll and benefits due to the Transferred
Employees for the remainder of December, 2008, the cost of which
shall be paid to Assignor as part of the adjustment process
described at the end of this Section 5 ; and
(d) $13,599.00 representing an
additional amount which the parties acknowledge is due to
Assignor.
2
No later than January 15,
2009 Company, Hospital and Assignor shall reasonably agree upon the
final amounts due to Assignor (x) for Assignor’s share
of the Company’s profits for the year to date through the
Effective Date that have not previously been distributed to
Assignor, and (y) under subsection (c) above. Any adjusting
payments due from one party to another shall be paid in cash no
later than January 20, 2009. Hospital agrees that it is
jointly and severally liable with the Company for any adjusting
payments due to Assignor under the terms of this Section 5.
The Assignor acknowledges and agrees
that except as set forth above: (i) it has received all
distributions from the Company to which it is entitled in respect
of the Purchased Interest and that neither the Company nor the
Assignee shall be required to make any further distributions or
payments to the Assignor in respect of the Purchased Interest;
(ii) neither it nor any of its Affiliates has made any
advances or other loans to the Company that remain outstanding, and
(iii) except for amounts due to the Assignor pursuant to the Lease
or under the terms of this Agreement, no future payments are owed
by the Company or the Assignee (or any of its Affiliates) to the
Assignee or any of its Affiliates.
6. Employees .
(a) The parties acknowledge and agree
that attached hereto as Exhibit B is a list of the
individuals employed by the Assignor (or its affiliate) that are
currently providing services to the Company and their respective
hire dates and job code descriptions. Effective on the Effective
Date, the Assignor (or its affiliate) shall terminate the
employment of such employees, and the Company (or the Hospital)
shall offer employment to all such employees. Such offer shall be
in a comparable position. For purposes of this Agreement, any such
employees who accept employment with the Company (or the Hospital)
shall be referred to as the "Transferred Employees." The
compensation and terms of employment for the Transferred Employees
will governed by the existing policies and/or Collective Bargaining
Agreements of the Company and/or the Hospital. Any Transferred
Employee who does not become a member of a Collective Bargaining
Unit will be employed on an "at-will" basis by the Company or the
Hospital pursuant to applicable policies and procedures of that
respective entity. (b) The Company or
the Hospital shall provide (or cause to be provided) to all
Transferred Employees employee benefits, plans and programs that
are substantially comparable to the benefits, plans and programs
provided to similarly situated employees of the Assignee. For
purposes of eligibility and vesti
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