West Park Healthcare Centre - Project Agreement · west park healthcare centre ”) , [redacted]...

Queen’s Printer for Ontario © Copyright 2018 – This document must not be copied or reproduced in any manner without the written permission of Ontario Infrastructure and Lands Corporation.

Confidential

PROJECT AGREEMENT (REDACTED VERSION)

WEST PARK HEALTHCARE CENTRE

HOSPITAL DEVELOPMENT PROJECT

CONFIDENTIAL

West Park Healthcare Centre Project Agreement Hospital Development Project Redacted Version


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TABLE OF CONTENTS

1. DEFINITIONS AND INTERPRETATION ................................................................................ 2

1.1 Definitions and Interpretation ................................................................................................... 21.2 Conflict of Terms ...................................................................................................................... 41.3 Conflict of Documents .............................................................................................................. 5

2. COMMERCIAL CLOSE AND FINANCIAL CLOSE .............................................................. 5

2.1 Effective Date ........................................................................................................................... 52.2 Standby Letter of Credit ........................................................................................................... 52.3 Financial Close ......................................................................................................................... 62.4 Disruption in Financial Markets ............................................................................................... 7

3. SCOPE OF AGREEMENT .......................................................................................................... 8

3.1 Scope of Agreement .................................................................................................................. 8

4. BUSINESS OPPORTUNITIES .................................................................................................... 8

4.1 Business Opportunities ............................................................................................................. 8

5. REPRESENTATIONS AND WARRANTIES ............................................................................ 8

5.1 Project Co Representations and Warranties .............................................................................. 85.2 Contracting Authority Representations and Warranties ......................................................... 10

6. BACKGROUND INFORMATION ........................................................................................... 12

6.1 No Liability ............................................................................................................................. 126.2 No Warranty ........................................................................................................................... 126.3 No Claims ............................................................................................................................... 126.4 Technical Reports ................................................................................................................... 13

7. PROJECT DOCUMENTS .......................................................................................................... 13

7.1 Project Documents .................................................................................................................. 137.2 Ancillary Documents .............................................................................................................. 137.3 Changes to Lending Agreements and Refinancing ................................................................. 147.4 Compliance with Lending Agreements .................................................................................. 14

8. CONTRACTING AUTHORITY RESPONSIBILITIES ......................................................... 15

8.1 General .................................................................................................................................... 15

9. PROJECT CO RESPONSIBILITIES ....................................................................................... 15

9.1 Other Business ........................................................................................................................ 159.2 General .................................................................................................................................... 169.3 Project Co Parties .................................................................................................................... 16



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9.4 Permits, Licences, Approvals and Agreements ...................................................................... 169.5 Safety and Security ................................................................................................................. 179.6 Additional Works .................................................................................................................... 189.7 Protection of Works and Property ........................................................................................... 219.8 Minimize Disturbance in Existing Facilities ........................................................................... 229.9 COR Certification ................................................................................................................... 229.10 Demolition Requirements ....................................................................................................... 24

10. REPRESENTATIVES ................................................................................................................. 26

10.1 Contracting Authority Representative .................................................................................... 2610.2 The Project Co Representative................................................................................................ 2710.3 Communications to Representatives ....................................................................................... 2710.4 Key Individuals ....................................................................................................................... 27

11. WORKS COMMITTEE ............................................................................................................. 28

11.1 Establishment .......................................................................................................................... 2811.2 Function and Role ................................................................................................................... 2911.3 Term of Works Committee ..................................................................................................... 3011.4 Replacement of Committee Members .................................................................................... 3011.5 Procedures and Practices......................................................................................................... 3011.6 Proceeding at Risk .................................................................................................................. 31

12. FACILITIES MANAGEMENT COMMITTEE ....................................................................... 33

12.1 Establishment .......................................................................................................................... 3312.2 Function and Role ................................................................................................................... 3312.3 Replacement of Committee Members .................................................................................... 3412.4 Procedures and Practices......................................................................................................... 34

13. QUALITY ASSURANCE ........................................................................................................... 35

13.1 Quality Plans and Systems ...................................................................................................... 3513.2 Changes to Plans ..................................................................................................................... 3813.3 Quality Manuals and Procedures ............................................................................................ 3813.4 Quality Monitoring ................................................................................................................. 38

14. LICENCE ..................................................................................................................................... 38

14.1 Licence to Site ........................................................................................................................ 3814.2 Non-exclusive Licence/Development of Site ......................................................................... 3914.3 Limited Access Areas ............................................................................................................. 4014.4 Naming and Signage ............................................................................................................... 4014.5 No Interest in Land ................................................................................................................. 4014.6 Non-Disturbance Agreement .................................................................................................. 40

15. TITLE ENCUMBRANCES ........................................................................................................ 40

15.1 Title Encumbrances ................................................................................................................ 40



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15.2 No Site Encumbrances ............................................................................................................ 4115.3 Construction Lien Act (Ontario) ............................................................................................. 41

16. SITE CONDITION ...................................................................................................................... 42

16.1 Acceptance of Site Condition ................................................................................................. 4216.2 Contamination ......................................................................................................................... 4316.3 Items of Geological, Historical or Archaeological Interest or Value ...................................... 44

17. CITY OF TORONTO AND THIRD PARTY FINANCIAL OBLIGATIONS ...................... 45

17.1 City of Toronto and Third Party Financial Obligations .......................................................... 4517.2 Contracting Authority Financial Obligations .......................................................................... 45

18. DESIGN AND CONSTRUCTION OBLIGATIONS ................................................................ 45

18.1 Overall Responsibility ............................................................................................................ 4518.2 Complete and Operational Facility ......................................................................................... 4718.3 Development of Design .......................................................................................................... 4718.4 Start-Up Meeting .................................................................................................................... 4918.5 Design Workshops .................................................................................................................. 4918.6 Clinical Functionality ............................................................................................................. 5218.7 Performance of Design Obligations ........................................................................................ 5318.8 General Construction Obligations ........................................................................................... 5318.9 Substitutions............................................................................................................................ 5418.10 Change in Standards ............................................................................................................... 5418.11 Works Submittals .................................................................................................................... 5418.12 Cash Allowance Items ............................................................................................................ 5418.13 Community Benefits and Apprenticeship Declaration, Plan and Annual Report ................... 5618.14 Procurement Monitoring and Implementation Plan ................................................................ 58

19. CONTRACTING AUTHORITY ACCESS AND MONITORING ......................................... 58

19.1 Contracting Authority Access During the Works Phase ......................................................... 5819.2 Increased Monitoring .............................................................................................................. 5919.3 Right to Open Up .................................................................................................................... 5919.4 No Relief from Obligations .................................................................................................... 59

20. WORKS SCHEDULE AND WORKS REPORT ...................................................................... 60

20.1 Completion of Works .............................................................................................................. 6020.2 The Works Schedule ............................................................................................................... 6020.3 Changes to the Works Schedule ............................................................................................. 6220.4 Failure to Maintain Schedule .................................................................................................. 6220.4A Notification of Early Phase Completion ................................................................................. 6420.5 Notification of Early Substantial Completion ......................................................................... 6520.6 Works Report .......................................................................................................................... 65



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21. EQUIPMENT ............................................................................................................................... 66

21.1 Equipment Steering Committee .............................................................................................. 6621.2 Contracting Authority Equipment Responsibilities ................................................................ 6721.3 Project Co Equipment Responsibilities .................................................................................. 6921.4 Additional Project Co Equipment Responsibilities ................................................................ 7621.5 Minimizing Disruptions .......................................................................................................... 7621.6 Equipment Training ................................................................................................................ 7621.7 Scheduling of Equipment and Existing Equipment Related Activities .................................. 7721.8 Maintenance of Equipment ..................................................................................................... 78

22. LEADERSHIP IN ENERGY & ENVIRONMENTAL DESIGN ............................................ 79

22.1 LEED Design and Construction Obligations .......................................................................... 7922.2 LEED Progress Reports .......................................................................................................... 7922.3 LEED Certification ................................................................................................................. 7922.4 Greenhouse Gas Credits .......................................................................................................... 7922.5 Energy Matters ........................................................................................................................ 79

23. INDEPENDENT CERTIFIER ................................................................................................... 80

23.1 Appointment ........................................................................................................................... 8023.2 Role of Independent Certifier ................................................................................................. 8023.3 Changes to Terms of Appointment ......................................................................................... 8023.4 Right to Change Appointment ................................................................................................ 8023.5 Cooperation ............................................................................................................................. 8023.6 Payment of Independent Certifier ........................................................................................... 8123.7 Replacement............................................................................................................................ 81

24. COMMISSIONING AND COMPLETION............................................................................... 87

24.1 Commissioning Activities ....................................................................................................... 8724.2 Final Commissioning Program ............................................................................................... 8724.3 Commencement of Project Co Commissioning ...................................................................... 8824.4 Substantial Completion Certificate ......................................................................................... 8824.5 Operation and Maintenance Manuals and Warranties ............................................................ 9024.6 Hospital Commissioning ......................................................................................................... 9024.7 Countdown Notice .................................................................................................................. 9024.8 Minor Deficiencies ................................................................................................................. 9124.9 Rectification of Minor Deficiencies ........................................................................................ 9224.10 Failure to Rectify Minor Deficiencies .................................................................................... 9224.11 Remaining Works Minor Deficiencies ................................................................................... 9224.12 Rectification of Remaining Works Minor Deficiencies ......................................................... 9324.13 Final Completion Countdown Notice ..................................................................................... 9324.14 Final Completion Certificate................................................................................................... 9424.15 Effect of Certificates/Use ........................................................................................................ 9524.16 Remaining Works Letter of Credit ......................................................................................... 9524.17 Transition ................................................................................................................................ 9724.18 Transition Subcommittee ........................................................................................................ 98



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25. PROJECT CO SERVICE OBLIGATIONS .............................................................................. 98

25.1 Overall Responsibility ............................................................................................................ 9825.2 Commencement of Services ................................................................................................... 9825.3 Coordination and No Disruption to Contracting Authority .................................................... 9925.4 No Closure of Existing Facilities or Facility .......................................................................... 9925.5 Equipment for Project Co Services ......................................................................................... 99

26. MAINTENANCE ......................................................................................................................... 99

26.1 Maintenance Plans .................................................................................................................. 9926.2 Revisions to Scheduled Maintenance Plan ........................................................................... 10026.3 Contracting Authority Change in Timing ............................................................................. 10126.4 Unscheduled Maintenance Work .......................................................................................... 10126.5 Emergency Maintenance Work ............................................................................................. 10126.6 Other Maintenance Work ...................................................................................................... 10226.7 Plant Services ........................................................................................................................ 10226.8 Performance Audits .............................................................................................................. 102

27. HUMAN RESOURCES............................................................................................................. 103

27.1 Project Co Covenants with respect to Employment of the Affected Employees .................. 10327.2 Project Co Covenants with respect to Certain Terms and Conditions of Employment ........ 10427.3 Transfer of Employees .......................................................................................................... 10527.4 Admittance of Personnel ....................................................................................................... 10527.5 Confirmation of Action ......................................................................................................... 10527.6 Notification of Personnel ...................................................................................................... 10527.7 Finality as to Admission ....................................................................................................... 10627.8 Adherence to Policies ........................................................................................................... 10627.9 Change in Hospital Public Health Requirements Policies .................................................... 10627.10 Staff Competency ................................................................................................................. 10627.11 Convictions ........................................................................................................................... 10727.12 Effect of Convictions ............................................................................................................ 10727.13 Notification of Convictions................................................................................................... 10727.14 Disciplinary Action ............................................................................................................... 10727.15 Management Contact Information ........................................................................................ 10827.16 Health Screening ................................................................................................................... 10827.17 Retention of Screening Records............................................................................................ 10827.18 Report on Screening .............................................................................................................. 10827.19 Health Risks .......................................................................................................................... 10927.20 Orientation Procedure ........................................................................................................... 10927.21 Labour Disruption ................................................................................................................. 10927.22 Material Changes to Terms and Conditions of Employment ................................................ 10927.23 Labour Combination Variation ............................................................................................. 110

28. GOODS, EQUIPMENT, CONSUMABLES AND MATERIALS ......................................... 110

28.1 Standards ............................................................................................................................... 11028.2 Hazardous Substances and Materials .................................................................................... 11028.3 Change in Hospital Hazardous Materials Policies ................................................................ 112



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29. MONITORING .......................................................................................................................... 112

29.1 Monitoring of Performance................................................................................................... 11229.2 Failure Points ........................................................................................................................ 11329.3 Warning Notices ................................................................................................................... 11329.4 Monitoring Notices ............................................................................................................... 113

30. CONTRACTING AUTHORITY’S REMEDIAL RIGHTS................................................... 115

30.1 Exercise of Remedial Rights ................................................................................................. 11530.2 Emergency ............................................................................................................................ 11730.3 Rectification .......................................................................................................................... 11730.4 Costs and Expenses ............................................................................................................... 11830.5 Reimbursement Events ......................................................................................................... 11830.6 Reimbursement if Improper Exercise of Rights ................................................................... 119

31. PAYMENT ................................................................................................................................. 119

31.1 Payments During the Construction Period ............................................................................ 11931.2 Monthly Service Payments ................................................................................................... 11931.3 Payment Adjustments ........................................................................................................... 12031.4 Payment Commencement ..................................................................................................... 12031.5 Adjustments to Payment Periods .......................................................................................... 12031.6 Invoicing and Payment Arrangements .................................................................................. 12031.7 Electronic Invoicing .............................................................................................................. 12231.8 Final Payment Periods .......................................................................................................... 12231.9 Disputes ................................................................................................................................ 12331.10 Payments ............................................................................................................................... 12431.11 Manner of Payment ............................................................................................................... 12431.12 Intentionally Deleted ............................................................................................................. 12431.13 Set-Off .................................................................................................................................. 12431.14 Effect of Payment ................................................................................................................. 12431.15 Audit of Performance of Project Operations......................................................................... 12431.16 No Other Entitlement ............................................................................................................ 125

32. TAXES ........................................................................................................................................ 126

32.1 Taxes ..................................................................................................................................... 12632.2 Changes in Scope of Taxation .............................................................................................. 12632.3 Changes in Recoverability of Tax Credits ............................................................................ 12632.4 Information and Assistance Provided by Project Co ............................................................ 12732.5 Residency – Income Tax Act (Canada) ................................................................................. 12732.6 Taxes – General .................................................................................................................... 12732.7 Taxes – Indemnity ................................................................................................................ 127

33. FINANCIAL MODEL ............................................................................................................... 128

33.1 Appointment of Custodian .................................................................................................... 12833.2 Delivery and Use of Financial Model ................................................................................... 128



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34. RECORDS, INFORMATION AND AUDIT ........................................................................... 129

34.1 Records Provisions ............................................................................................................... 12934.2 Information and General Audit Rights ................................................................................. 12934.3 Delivery of Reports to IO ..................................................................................................... 130

35. CHANGES IN LAW .................................................................................................................. 130

35.1 Performance after Change in Law ........................................................................................ 13035.2 Works Change in Law .......................................................................................................... 13035.3 Relevant Change in Law ....................................................................................................... 131

36. VARIATIONS ............................................................................................................................ 133

36.1 Variation Procedure .............................................................................................................. 13336.2 Innovation and Value Engineering ....................................................................................... 133

37. DELAY EVENTS ...................................................................................................................... 135

37.1 Definition .............................................................................................................................. 13537.2 Consequences of a Delay Event ............................................................................................ 13637.3 Mitigation.............................................................................................................................. 139

38. COMPENSATION EVENTS ................................................................................................... 140

38.1 Definition .............................................................................................................................. 14038.2 Consequences of a Compensation Event .............................................................................. 14038.3 Mitigation.............................................................................................................................. 14038.4 Insured Exposure .................................................................................................................. 14138.5 Delivery of Works Schedule ................................................................................................. 141

39. EXCUSING CAUSES ................................................................................................................ 141

39.1 Definition .............................................................................................................................. 14139.2 Consequences of an Excusing Cause .................................................................................... 14339.3 Mitigation.............................................................................................................................. 14439.4 Insured Exposure .................................................................................................................. 144

40. RELIEF EVENTS ...................................................................................................................... 144

40.1 Definition .............................................................................................................................. 14440.2 Consequences of a Relief Event ........................................................................................... 14540.3 Mitigation and Process .......................................................................................................... 14640.4 Insured Exposure .................................................................................................................. 146

41. FORCE MAJEURE ................................................................................................................... 147

41.1 Definition .............................................................................................................................. 14741.2 Consequences of Force Majeure ........................................................................................... 14741.3 Mitigation and Process .......................................................................................................... 14841.4 Insured Exposure .................................................................................................................. 148



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41.5 Modifications ........................................................................................................................ 149

42. PROJECT CO DEFAULT ........................................................................................................ 149

42.1 Project Co Events of Default ................................................................................................ 14942.2 Notification of Occurrence ................................................................................................... 15342.3 Right to Termination ............................................................................................................. 15342.4 Remedy Provisions ............................................................................................................... 15342.5 Replacement of Non-Performing Service Provider .............................................................. 15442.6 Contracting Authority’s Costs .............................................................................................. 15542.7 No other Rights to Terminate ............................................................................................... 155

43. CONTRACTING AUTHORITY DEFAULT ......................................................................... 156

43.1 Contracting Authority Events of Default .............................................................................. 15643.2 Project Co’s Options ............................................................................................................. 15643.3 Project Co’s Costs ................................................................................................................. 15743.4 No Other Rights to Terminate............................................................................................... 157

44. RELIEF EVENT AND NON-DEFAULT TERMINATION ................................................. 157

44.1 Termination for Relief Event ................................................................................................ 15744.2 Termination for Force Majeure ............................................................................................. 15744.3 Termination for Convenience ............................................................................................... 15744.4 Automatic Expiry on Expiry Date ........................................................................................ 158

45. EFFECT OF TERMINATION ................................................................................................. 158

45.1 Termination ........................................................................................................................... 15845.2 Continued Effect – No Waiver ............................................................................................. 15845.3 Continuing Performance ....................................................................................................... 15845.4 Consequences of Termination............................................................................................... 15845.5 Ownership of Information..................................................................................................... 16045.6 Provision in Subcontracts ..................................................................................................... 16145.7 Transitional Arrangements.................................................................................................... 16145.8 Termination upon Aforesaid Transfer .................................................................................. 16245.9 Survival ................................................................................................................................. 162

46. COMPENSATION ON TERMINATION ............................................................................... 162

46.1 Compensation on Termination .............................................................................................. 16246.2 Full and Final Settlement ...................................................................................................... 162

47. EXPIRY TRANSITION PROCEDURE .................................................................................. 163

47.1 Expiry Transition .................................................................................................................. 163

48. INTELLECTUAL PROPERTY ............................................................................................... 163

48.1 Representation and Warranty ................................................................................................ 16348.2 Delivery of Project Data and Intellectual Property Rights ................................................... 163



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48.3 Licence of Project Data and Intellectual Property Rights ..................................................... 16348.4 Jointly Developed Materials ................................................................................................. 16448.5 Maintenance of Data ............................................................................................................. 16448.6 Claims ................................................................................................................................... 16548.7 Contracting Authority Trade-Marks ..................................................................................... 16548.8 Confidential Information ...................................................................................................... 16548.9 Government Use of Documents ............................................................................................ 165

49. CONFIDENTIALITY / COMMUNICATIONS ..................................................................... 166

49.1 Disclosure ............................................................................................................................. 16649.2 Redaction .............................................................................................................................. 16649.3 Disclosure to Government .................................................................................................... 16749.4 Freedom of Information and Protection of Privacy Act ....................................................... 16749.5 Use and Disclosure of Confidential Information .................................................................. 16749.6 Exceptions ............................................................................................................................. 16849.7 Survival of Confidentiality ................................................................................................... 16949.8 Communications ................................................................................................................... 169

50. PERSONAL INFORMATION ................................................................................................. 169

50.1 General .................................................................................................................................. 16950.2 Protection of Patient Information.......................................................................................... 16950.3 Survival ................................................................................................................................. 170

51. INSURANCE AND PERFORMANCE SECURITY .............................................................. 170

51.1 General Requirements ........................................................................................................... 17051.2 No Relief from Liabilities and Obligations........................................................................... 170

52. TITLE ......................................................................................................................................... 170

52.1 Title ....................................................................................................................................... 170

53. INDEMNITIES .......................................................................................................................... 170

53.1 Project Co Indemnities to Contracting Authority ................................................................. 17053.2 Contracting Authority Indemnities to Project Co ................................................................. 17253.3 Conduct of Claims ................................................................................................................ 17353.4 Mitigation – Indemnity Claims ............................................................................................. 175

54. LIMITS ON LIABILITY .......................................................................................................... 175

54.1 Indirect Losses ...................................................................................................................... 17554.2 No Liability in Tort ............................................................................................................... 17554.3 Sole Remedy ......................................................................................................................... 17554.4 Maximum Liability ............................................................................................................... 17654A. Liquidated Damages ............................................................................................................. 176



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55. DISPUTE RESOLUTION PROCEDURE .............................................................................. 177

56. ASSIGNMENT, SUBCONTRACTING AND CHANGES IN CONTROL .......................... 177

56.1 Project Co Assignment ......................................................................................................... 17756.2 Contracting Authority Assignment ....................................................................................... 17856.3 Subcontractors ...................................................................................................................... 17856.4 Changes in Ownership and Control ...................................................................................... 17956.5 Contracting Authority Due Diligence ................................................................................... 18056.6 Gain Share............................................................................................................................. 181

57. PROHIBITED ACTS ................................................................................................................ 181

57.1 Definition .............................................................................................................................. 18157.2 Remedies ............................................................................................................................... 18257.3 Permitted Payments .............................................................................................................. 18357.4 Notification ........................................................................................................................... 18357.5 Replacement of Project Co Party .......................................................................................... 183

58. NOTICES ................................................................................................................................... 183

58.1 Notices to Parties .................................................................................................................. 18358.2 Notices to Representatives .................................................................................................... 18458.3 Facsimile ............................................................................................................................... 18458.4 Change of Address ................................................................................................................ 18458.5 Deemed Receipt of Notices .................................................................................................. 18458.6 Service on Contracting Authority ......................................................................................... 185

59. GENERAL .................................................................................................................................. 185

59.1 Amendments ......................................................................................................................... 18559.2 Waiver ................................................................................................................................... 18559.3 Relationship Between the Parties.......................................................................................... 18559.4 General Duty to Mitigate ...................................................................................................... 18659.5 Actual Knowledge ................................................................................................................ 18659.6 Entire Agreement .................................................................................................................. 18659.7 No Reliance........................................................................................................................... 18659.8 Severability ........................................................................................................................... 18759.9 Enurement ............................................................................................................................. 18759.10 Governing Law and Jurisdiction ........................................................................................... 18759.11 Cumulative Remedies ........................................................................................................... 18759.12 Further Assurance ................................................................................................................. 18759.13 Costs ..................................................................................................................................... 18759.14 Language of Agreement ........................................................................................................ 18859.15 Proof of Authority ................................................................................................................. 18859.16 Counterparts .......................................................................................................................... 18859.17 Government Entities as Third Party Beneficiaries ................................................................ 188



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SCHEDULES

Schedule 1 - Definitions and Interpretation Schedule 2 - Completion Documents Schedule 3 - Custody Agreement Schedule 4 - Lenders’ Direct Agreement Schedule 5 - Direct Agreements Schedule 6 - Independent Certifier Agreement Schedule 7 - Intentionally DeletedSchedule 8 - Intentionally Deleted Schedule 9 - Key Individuals Schedule 10 - Review Procedure Schedule 11A - Design Quality Plan and Construction Quality Plan Schedule 11B - Service Quality Plan Outline Schedule 12 - Works Scheduling Requirements Schedule 13 - Project Co Proposal Extracts Schedule 14 - Outline Commissioning Program Schedule 15 - Output Specifications Schedule 16 - Title Encumbrances Schedule 17 - Employee Transition Schedule 18 - Communications Schedule 19 - Construction Period Payments Schedule 20 - Payment Mechanism Schedule 21 - Procurement Monitoring and Implementation Plan Schedule 22 - Variation Procedure Schedule 23 - Compensation on Termination Schedule 24 - Expiry Transition Procedure Schedule 25 - Insurance and Performance Security Requirements Schedule 26 - Record Provisions Schedule 27 - Dispute Resolution Procedure Schedule 28 - Refinancing Schedule 29 - Remaining Works Letter of Credit Schedule 30 - Insurance Trust Agreement Schedule 31 - Project Co Information Schedule 32 - Financial Model Extracts Schedule 33 - Trust Account Agreement Schedule 34 - Works Report Requirements Schedule 35 - Site Schedule 36 - Energy Matters Schedule 37 - Cooperation Agreement Schedule 38 - Reports Schedule 39 - Contractor Site Specific Safety Manual Requirements Schedule 40 - Community Benefits and Apprenticeship Declaration



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THIS PROJECT AGREEMENT is made as of the 8th day of August, 2018

BETWEEN:

WEST PARK HEALTHCARE CENTRE, a non-share capital corporation incorporated under the laws of Ontario

(the “Contracting Authority”)

AND:

ELLISDON INFRASTRUCTURE WPHC GENERAL PARTNERSHIP, [REDACTED]

(“Project Co”)

WHEREAS:

A. Contracting Authority, with the assistance of IO, wishes to redevelop its existing hospital in Toronto, Ontario.

B. Contracting Authority provides the Hospital Services at the Existing Facilities and will provide such services at the Facility. Project Co will provide the Project Operations, which include the design, construction, financing and maintenance of the Facility (the “Project”).

C. Contracting Authority and Project Co wish to enter into this project agreement (the “Project Agreement”), which sets out the terms and conditions upon which Project Co shall perform the Project Operations.

D. The overriding priorities of Contracting Authority in entering into and implementing this Project Agreement are the health and safety of the patients and staff of the Existing Facilities and the Facility, the patients’ healthcare needs, and the provision of first-rate healthcare services and Project Co recognizes and understands that the health and safety of the patients and staff of the Existing Facilities and the Facility are, at all times, paramount.

E. The Project will proceed as an alternative financing and procurement project and complies with the principles set out in MOI’s Building a Better Tomorrow: An Infrastructure Planning, Financing and Procurement Framework for Ontario’s Public Sector (the “IPFP Framework”).

F. The IPFP Framework establishes 5 fundamental principles which guide the financing and procurement of public infrastructure projects in Ontario:

1. The public interest is paramount.

2. Value for money must be demonstrable.

3. Appropriate public control/ownership must be preserved.

4. Accountability must be maintained.



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5. All processes must be fair, transparent and efficient.

G. The IPFP Framework states that, consistent with the principle of appropriate public ownership/control, public ownership of assets will be preserved in the hospital sector.

H. MOHLTC is responsible for the development, coordination, maintenance, and funding of health services, including a balanced and integrated system of hospitals, nursing homes, laboratories, ambulances, other health facilities and providers to meet the health needs of the people of Ontario.

I. There are a number of statutes which govern the operation and administration of hospitals in Ontario. Under the Public Hospitals Act (Ontario), certain actions of hospitals can only be undertaken with the approval of the Minister of Health and Long-Term Care. Subsection 4(3) of the Public Hospitals Act (Ontario) states that no additional building or facilities shall be added to a hospital until the plans therefore have been approved by the Minister. Under subsection 4(2) of the Public Hospitals Act (Ontario), no institution, building or other premises or place shall be operated or used for the purposes of a hospital unless the Minister has approved the operation and or use of the premises or place for that purpose.

J. The Minister of Health and Long-Term Care has powers to protect the public interest regarding matters relevant to the quality of the management and administration of a hospital, the proper management of the health care system in general, the availability of financial resources for the management and delivery of health care services, the accessibility of services in the community where the hospital is located and the quality of care and treatment of patients.

K. Project Co recognizes and understands that Contracting Authority is a public hospital under the Public Hospitals Act (Ontario) and is, therefore, subject to a highly regulated legal and operational environment.

L. With a view to ensuring that both Parties are able to properly and effectively discharge their respective duties, functions and responsibilities under Applicable Law, it is the intent that Contracting Authority and Project Co work collaboratively, responsibly and cooperatively throughout the Project Term.

NOW THEREFORE in consideration of the mutual covenants and agreements of the Parties hereinafter contained and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties covenant and agree as follows:

1. DEFINITIONS AND INTERPRETATION

1.1 Definitions and Interpretation

(a) This Project Agreement shall be interpreted in accordance with Schedule 1 – Definitions and Interpretation.

(b) This Project Agreement is comprised of this executed agreement and the following documents, all of which are hereby incorporated by reference into and form part of this Project Agreement:

Schedule No. Description Schedule 1 - Definitions and Interpretation



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Schedule 2 - Completion Documents Schedule 3 - Custody Agreement Schedule 4 - Lenders’ Direct Agreement Schedule 5 - Direct Agreements Schedule 6 - Independent Certifier Agreement Schedule 7 - Intentionally Deleted Schedule 8 - Intentionally Deleted Schedule 9 - Key Individuals Schedule 10 - Review Procedure Schedule 11A - Design Quality Plan and Construction Quality Plan Schedule 11B - Service Quality Plan Outline Schedule 12 - Works Scheduling Requirements Schedule 13 - Project Co Proposal Extracts Schedule 14 - Outline Commissioning Program Schedule 15 - Output Specifications Schedule 16 - Title Encumbrances Schedule 17 - Employee Transition Schedule 18 - Communications Schedule 19 - Construction Period Payments Schedule 20 - Payment Mechanism Schedule 21 - Procurement Monitoring and Implementation Plan Schedule 22 - Variation Procedure Schedule 23 - Compensation on Termination Schedule 24 - Expiry Transition Procedure Schedule 25 - Insurance and Performance Security Requirements Schedule 26 - Record Provisions Schedule 27 - Dispute Resolution Procedure Schedule 28 - Refinancing Schedule 29 - Remaining Works Letter of Credit Schedule 30 - Insurance Trust Agreement Schedule 31 - Project Co Information Schedule 32 - Financial Model Extracts Schedule 33 - Trust Account Agreement Schedule 34 - Works Report Requirements Schedule 35 - Site Schedule 36 - Energy Matters Schedule 37 - Cooperation Agreement Schedule 38 - Reports Schedule 39 - Contractor Site Specific Safety Manual Requirements Schedule 40 - Community Benefits and Apprenticeship Declaration

(c) The documents comprising this Project Agreement are complementary and what is called for by any one of them shall be interpreted as if called for by all, except in the event of ambiguities, conflicts or inconsistencies, in which case Section 1.2 shall apply.

(d) Except for those parts of Project Co’s proposal which are incorporated by reference into this Project Agreement by the Project Co Proposal Extracts, on Financial Close, the Request for Proposals and Project Co’s proposal shall be superseded entirely by this Project Agreement and rendered null and void, and shall not be relied upon or used by Project Co, Contracting Authority or anyone else (including anyone pursuant to Schedule 27 – Dispute Resolution Procedure or any arbitral body or any court) in any



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way to interpret or qualify the scope of the Project Operations, any obligations or liabilities of Project Co, or anything else contained in this Project Agreement.

(e) Unless it is specifically provided that a consent, approval or satisfaction is in the sole discretion of Contracting Authority, no consent, approval or satisfaction of Contracting Authority or the Contracting Authority Representative shall be unreasonably withheld or delayed.

(f) Unless it is specifically provided that a consent, approval or satisfaction is in the sole discretion of Project Co, no consent, approval or satisfaction of Project Co or the Project Co Representative shall be unreasonably withheld or delayed.

1.2 Conflict of Terms

(a) In the event of ambiguities, conflicts or inconsistencies between or among any of the provisions of this Project Agreement, the provisions shall govern in the following order of precedence with each taking precedence over those listed subsequently:

(i) the provisions of amendments in writing to this Project Agreement signed by the Parties and Variation Confirmations shall govern and take precedence only over those specific provisions of this Project Agreement expressly amended thereby;

(ii) any provision establishing a higher standard of safety, reliability, durability, performance or service shall take precedence over a provision establishing a lower standard of safety, reliability, durability, performance or service;

(iii) the body of this Project Agreement;

(iv) Schedule 1 Definitions and Interpretation;

(v) Schedule 27 Dispute Resolution Procedure;

(vi) Schedule 20 Payment Mechanism;

(vii) Schedule 15 Output Specifications;

(viii) Schedule 25 Insurance and Performance Security Requirements;

(ix) Schedule 22 Variation Procedure;

(x) Schedule 10 Review Procedure;

(xi) Schedule 14 Outline Commissioning Program;

(xii) Schedule 11A Design Quality Plan and Construction Quality Plan;

(xiii) Schedule 28 Refinancing;

(xiv) Schedule 23 Compensation on Termination;

(xv) Schedule 26 Record Provisions;



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(xvi) Schedule 24 Expiry Transition Procedure;

(xvii) the other Schedules in the order in which they are listed in Section 1.1(b); and

(xviii) Schedule 13 Project Co Proposal Extracts.

(b) Subject to Section 1.2(a), if the ambiguity, conflict or inconsistency is between a provision of general application and a provision that applies only to a specific part of the Project Operations, the provision that applies to the specific part of the Project Operations shall govern for that specific part of the Project Operations.

(c) If any ambiguity, conflict or inconsistency is not readily resolved by the foregoing provisions of this Section 1.2, then Project Co or Contracting Authority, upon discovery of same, shall immediately give notice to the Contracting Authority Representative. The Contracting Authority Representative shall, within 10 Business Days after such notice, make a determination of which provision governs and give notice of such determination, in writing, to Project Co.

(d) Contracting Authority and Project Co shall comply with the determination of the Contracting Authority Representative pursuant to this Section 1.2 unless Contracting Authority or Project Co disputes the decision of the Contracting Authority Representative in which event such Dispute may be referred for resolution in accordance with Schedule 27 – Dispute Resolution Procedure.

1.3 Conflict of Documents

(a) In the event of any ambiguity, conflict or inconsistency between the provisions of this Project Agreement and the Lenders’ Direct Agreement, the provisions of the Lenders’ Direct Agreement shall prevail and govern to the extent of such ambiguity, conflict or inconsistency.

1.4 Joint and Several Liability

(a) Each of the Project Co Partners hereby acknowledges and agrees to and in favour of Contracting Authority that the Project Co Partners are jointly and severally liable for the due and punctual payment of all indebtedness of, and performance and discharge of all covenants, obligations, agreements and undertakings (including indemnity obligations) of, Project Co under or pursuant to this Project Agreement now or hereafter existing.

2. COMMERCIAL CLOSE AND FINANCIAL CLOSE

2.1 Effective Date

(a) The provisions of Sections 1 to 11, 13, 15 to 23, 27, 28, 32, 34 to 36 and 48 to 59, and Schedules 1 to 3, 7, 9 to 11, 13, 16 to 19, 21, 22 and 25 to 27 will come into effect on the date of this Project Agreement. All other provisions of this Project Agreement will come into effect only on Financial Close. The provisions of this Project Agreement will terminate on the Termination Date.

2.2 Standby Letter of Credit

(a) [Intentionally Deleted]



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(b) Unless a Standby Letter of Credit is drawn by Contracting Authority in accordance with the provisions of this Project Agreement, Contracting Authority shall release and deliver the Standby Letter(s) of Credit to Project Co on Financial Close.

(c) Project Co shall ensure that the Standby Letter(s) of Credit (and any replacement therefor) is renewed prior to its expiry date if, as at such date, Financial Close will not, or may reasonably be expected not to, have occurred.

(d) If Project Co delivers multiple Standby Letter(s) of Credit from multiple Letter of Credit Providers in accordance with Section 9.1(2) of the Request for Proposals, Project Co acknowledges and agrees that:

(i) Contracting Authority may draw upon any Standby Letter of Credit provided by any Letter of Credit Provider in any specified rateable amount;

(ii) Contracting Authority may draw on any Standby Letter of Credit provided by any Letter of Credit Provider in a disproportionate amount to such Letter of Credit Providers’ contribution to security;

(iii) Contracting Authority may draw upon any Standby Letter of Credit provided by any Letter of Credit Provider even in the event that such Letter of Credit Provider is no longer a Project Co Party; and

(iv) the provision of multiple Standby Letters of Credit shall not in any way prejudice or adversely affect the rights of Contracting Authority to draw on the Standby Letter(s) of Credit in accordance with this Project Agreement, including in a circumstance where the default giving rise to Contracting Authority’s right to draw on the Standby Letter(s) of Credit is not the result of any act or omission of the Letter of Credit Provider(s) whose Standby Letter of Credit is drawn upon.

2.3 Financial Close

(a) No later than 30 days prior to the Financial Close Target Date, Project Co will deliver to Contracting Authority drafts of all documents referred to in Section 1 of Schedule 2 – Completion Documents.

(b) On or before the Financial Close Target Date:

(i) Project Co shall deliver to Contracting Authority the documents referred to in Section 1 of Schedule 2 – Completion Documents; and

(ii) Contracting Authority shall deliver to Project Co the documents referred to in Section 2 of Schedule 2 – Completion Documents.

(c) If Project Co fails to deliver to Contracting Authority any of the documents referred to in Section 1 of Schedule 2 – Completion Documents by the Financial Close Target Date (other than as a direct result of a breach by Contracting Authority of its obligations under Section 2.3(b)(ii)) and Contracting Authority does not waive such requirement, Contracting Authority will be entitled to draw on the Standby Letter of Credit and to retain the proceeds thereof as liquidated damages and may terminate this Project Agreement in its entirety by written notice having immediate effect. The Parties agree that such liquidated damages are not a penalty but represent a genuine and reasonable pre-estimate of the damages



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that Contracting Authority will suffer as a result of the happening of the specified event and would be difficult or impossible to quantify such damages upon the happening of the specified event. Such payment shall constitute full and final settlement of any and all damages that may be claimed by Contracting Authority as a result of Project Co not achieving Financial Close. The Parties agree that such liquidated damages shall be payable whether or not Contracting Authority incurs or mitigates its damages, and that Contracting Authority shall not have any obligation to mitigate any such damages.

(d) If Contracting Authority fails to deliver to Project Co any of the documents referred to in Section 2 of Schedule 2 – Completion Documents by the Financial Close Target Date (other than as a direct result of a breach by Project Co of its obligations under Section 2.3(b)(i)) and Project Co does not waive such requirement, Project Co will be entitled to the return of the Standby Letter of Credit and to terminate this Project Agreement in its entirety by written notice having immediate effect.

2.4 Disruption in Financial Markets

(a) If Financial Close cannot be achieved by the Financial Close Target Date by reason solely of a Severe Market Disruption, subject to Project Co’s obligation to renew the Standby Letter of Credit, pursuant to Section 2.2, the Financial Close Target Date will be extended until the date falling 10 Business Days (or such other period as the Parties agree, acting reasonably) after the date on which such Severe Market Disruption ceases.

(b) If a Severe Market Disruption exists, then, at any time before such Severe Market Disruption ceases and prior to Financial Close, Contracting Authority may in its sole discretion either:

(i) terminate this Project Agreement in its entirety by written notice having immediate effect; or

(ii) direct Project Co to assign to IO and IO will assume:

(A) the Project Agreement, and all of Project Co’s right, title and interest in the Project Data, the Intellectual Property Rights and the Project Co Permits, Licences, Approvals and Agreements; and

(B) those contracts between Project Co and any Project Co Party which IO elects to be assigned.

(c) If Contracting Authority exercises its rights pursuant to Section 2.4(b), and, provided Project Co has, if directed, delivered the assignments provided for in 2.4(b)(ii)(A) and 2.4(b)(ii)(B) above, Project Co will be entitled to the return of its Standby Letter of Credit and to payment of an amount equal to the Design and Bid Fee pursuant to Section 10.3.2 of the Request for Proposals plus [REDACTED] of such fee. Contracting Authority’s obligation to return the Standby Letter of Credit and to pay such fee shall be contingent on the receipt of a waiver, in form and substance satisfactory to Contracting Authority, that such fee represents full and final satisfaction of any obligation or liability of Contracting Authority, IO and any other Government Entity to Project Co and any Project Co Parties in connection with the Project Agreement and the Request for Proposals.



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3. SCOPE OF AGREEMENT

3.1 Scope of Agreement

(a) Project Co shall undertake the Project and perform the Project Operations in accordance with and subject to the provisions of this Project Agreement.

(b) Project Co shall exercise its rights and perform its obligations at its own cost and risk without recourse to Contracting Authority, except as otherwise provided in this Project Agreement. Project Co shall not have recourse to any Government Entity with respect to the subject matter of this Project Agreement.

4. BUSINESS OPPORTUNITIES

4.1 Business Opportunities

(a) Project Co acknowledges that Contracting Authority reserves the right to all commercial and other opportunities (including, for greater certainty, all retail and parking operations) in the Facility and the Existing Facilities and at the Site (“Business Opportunities”). Contracting Authority may, as set out in this Project Agreement, grant rights in the Business Opportunities to Project Co.

(b) To encourage the development of Business Opportunities, Project Co may, from time to time, propose Business Opportunities for Contracting Authority’s consideration. All such proposals shall describe the Business Opportunity in full with the expected financial and other advantages to both Parties. Contracting Authority may accept any such proposal in its sole discretion and subject to such terms and conditions as Contracting Authority may require.

(c) Notwithstanding that Project Co has proposed a Business Opportunity to Contracting Authority for its consideration, Project Co acknowledges that Contracting Authority reserves the right to proceed with such Business Opportunity or any similar Business Opportunity with Project Co or with any third party, and may initiate a separate procurement process for the development of any Business Opportunity.

(d) In determining whether to accept any proposal in respect of a Business Opportunity, Contracting Authority shall consult with and take into account the views of MOHLTC, and shall, if so required by MOHLTC, submit the relevant proposal to MOHLTC for consideration.

5. REPRESENTATIONS AND WARRANTIES

5.1 Project Co Representations and Warranties

(a) Project Co represents and warrants to Contracting Authority that as of the date of this Project Agreement:

(i) Project Co [REDACTED] and has all the requisite power and authority to own its properties and assets, to carry on its business as it is currently being conducted, and to enter into this Project Agreement and to perform its obligations hereunder;

(ii) [REDACTED];

(iii) [REDACTED];



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(iv) [REDACTED];

(v) [REDACTED]

(vi) Project Co and the Project Co Parties, collectively, have extensive experience and are knowledgeable in the design, construction and maintenance of hospital facilities and have the required ability, experience, skill and capacity to perform the Project Operations in a timely and professional manner as set out in this Project Agreement;

(vii) Project Co has the requisite power, authority and capacity to execute and deliver and perform this Project Agreement, and to do all acts and things, and execute, deliver and perform all other agreements, instruments, undertakings and documents as are required by this Project Agreement to be done, executed, delivered or performed;

(viii) no steps or proceedings have been taken or are pending to supersede or amend the constating documents, articles or by-laws of Project Co in a manner that would impair or limit its ability to perform the obligations of Project Co under this Project Agreement;

(ix) this Project Agreement has been duly authorized, executed, and delivered by Project Co and constitutes a legal, valid, and binding obligation of Project Co, enforceable against Project Co in accordance with its terms, subject only to:

(A) limitations with respect to the enforcement of remedies by bankruptcy, insolvency, moratorium, winding-up, arrangement, reorganization, fraudulent preference and conveyance and other laws of general application affecting the enforcement of creditors’ rights generally; and

(B) general equitable principles and the fact that the availability of equitable remedies is in the discretion of a court and that a court may stay proceedings or the execution of judgments;

(x) the execution, delivery, and performance by Project Co of this Project Agreement does not and will not violate or conflict with, or constitute a default under:

(A) its constating, formation or organizational documents, including any by-laws;

(B) Applicable Law; or

(C) any covenant, contract, agreement, or understanding to which it is a party or by which it or any of its properties or assets is bound or affected;

(xi) no Project Co Event of Default has occurred and is continuing;

(xii) all of the information regarding Project Co set out in Schedule 31 – Project Co Information is true and correct in all material respects;

(xiii) there are no actions, suits, proceedings, or investigations pending or threatened against Project Co or, to Project Co’s knowledge, any Project Co Party at law or in equity before any Governmental Authority or arbitral body (whether or not covered by insurance) that individually or in the aggregate could result in any material adverse effect on the business, properties, or assets, or the condition, financial or otherwise, of Project Co or in any impairment of its ability to perform its obligations under this Project Agreement, and Project Co has no knowledge of any violation or default



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with respect to any order, writ, injunction, or decree of any Governmental Authority or arbitral body that could result in any such material adverse effect or impairment;

(xiv) Project Co has carefully reviewed the whole of this Project Agreement, and all other documents made available to Project Co by or on behalf of Contracting Authority, and, to Project Co’s knowledge, nothing contained herein or therein inhibits or prevents Project Co from completing the Works or performing the Project Operations in accordance with this Project Agreement in a good and safe manner so as to achieve and satisfy the requirements of this Project Agreement;

(xv) Project Co is able to meet its obligations as they generally become due;

(xvi) Project Co is registered under Division V of Part IX of the Excise Tax Act (Canada) and its HST registration number is [REDACTED];

(xvii) the Scheduled Phase Completion Date is a realistic date and is achievable by Project Co performing the Works in accordance with this Project Agreement;

(xviii) the Scheduled Substantial Completion Date is a realistic date and is achievable by Project Co performing the Works in accordance with this Project Agreement;

(xix) Project Co is not a Non-Resident;

(xx) no Restricted Person has Direct or Indirect Power or Control over any member of the Project Co Group in relation to the decisions, management, actions or policies of Project Co [REDACTED] or in relation to the operation, management and ownership of the Project;

(xxi) to the knowledge of Project Co, no Restricted Person has directly or indirectly an Economic Interest in Project Co, [REDACTED] or the Project;

(xxii) the COR-Certified Construction Project Co Party is in possession of its COR Certification in good standing as required under this Project Agreement and has the ability to maintain such COR Certification in good standing at all times during the performance of the Works in accordance with its terms, provisions and conditions, or the COR-Qualified Construction Project Co Party:

(A) is in possession of its OHSAS 18001 Accreditation which remains in good standing and has the ability to maintain such OHSAS 18001 Accreditation in good standing at all times during the performance of the Works until such COR-Qualified Construction Project Co Party receives its COR Certification as required under this Project Agreement, and

(B) has made an application to the IHSA for its COR Certification as required under this Project Agreement;

(xxiii) the COR Certification of EllisDon Corporation extends and applies to the Construction Contractor.

5.2 Contracting Authority Representations and Warranties

(a) Contracting Authority represents and warrants to Project Co that as of the date of this Project Agreement:



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(i) Contracting Authority is a non-share capital corporation incorporated and validly existing under the laws of the Province of Ontario, is in good standing with the Ministry of Government and Consumer Services of Ontario with respect to the filing of annual reports, and has all the requisite corporate power and authority to own its properties and assets, to carry on its business as it is currently being conducted, and to enter into this Project Agreement and to perform its obligations hereunder;

(ii) Contracting Authority has the requisite power, authority and capacity to execute, deliver and perform this Project Agreement, and to do all acts and things, and execute, deliver and perform all other agreements, instruments, undertakings and documents as are required by this Project Agreement to be done, executed, delivered or performed;

(iii) no steps or proceedings have been taken or are pending to supersede or amend its constating documents, letters patent or by-laws in a manner that would impair or limit its ability to perform its obligations under this Project Agreement;

(iv) this Project Agreement has been duly authorized, executed, and delivered by Contracting Authority and constitutes a legal, valid, and binding obligation of Contracting Authority, enforceable against Contracting Authority in accordance with its terms, subject only to:

(A) limitations with respect to the enforcement of remedies by bankruptcy, insolvency, moratorium, winding-up, arrangement, reorganization, fraudulent preference and conveyance and other laws of general application affecting the enforcement of creditors’ rights generally; and

(B) general equitable principles and the fa

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