Ugh....
THIS is why I hate to drag out terminations.
I, personally, would give them a copy of their files (I am required to keep originals for 2 years; State Regs.).
I would then have all their stuff packed today. (Well, I would not have accepted the kids into care without the signed paperwork to begin with
but you already know that since I have told you once or twice
).
By refusing to sign to contract, they gave immediate notice. 
I'd call it a day at the point to be free of the hassle. Then again, that is my style.
I like simple and uncomplicated.