Healthcare Representations and Warranties. A With respect to each Receivable, as of the date such Receivable is created and included as an Eligible Receivable by FINOVA: (1) All documents and agreements relating to the Receivable requested by FINOVA have been delivered to FINOVA with respect to such Receivable and such documents are true and correct in all material respects; Borrower has timely and properly billed the applicable Payor of the Receivable (except where supporting claim documents must be forwarded to such Payor before a xxxx may be submitted in which case Borrower shall promptly complete documentation and billing of such Payors), and Borrower has delivered or caused to be delivered to such Payor all Payor requested supporting claim documents with respect to such Receivable including all documentation required by the applicable Payor(s) for payment on the Receivable, and the statutory period for issuing an explanation of benefits ("EOB") in connection with such Receivable has not expired; and all information set forth in the xxxx and supporting claim documents submitted to a Payor with respect to such Receivable is true, complete and correct in all material respects, and, if additional information is requested by such Payor in connection therewith, Borrower will promptly provide the same and, if necessary, will rebill or, if requested by the primary servicer (if other than Borrower) cooperate with such servicer(s) to rebill such Governmental Receivable; (2) Each such Receivable is exclusively owned by Borrower, and there is no security interest in or lien against such Receivable in favor of any third party other than FINOVA, nor is there any recording or filing against Borrower, as debtor, covering or purporting to cover any interest of any kind in any Receivable, except as has been or will be released or terminated by each party holding such adverse interest in the Receivable prior to or concurrently with the initial Loan made by FINOVA to Borrower. Borrower shall defend the first priority security interest of FINOVA in all Receivables against the claims of all persons claiming any interest adverse to FINOVA. With respect to any Governmental Receivable the rights transferred to FINOVA in connection with this Agreement do not include the right to claim payment in FINOVA's name from the applicable Payor or the right to direct such Payor to remit payment directly to FINOVA except as permitted by applicable laws and regulations governing such Governmental Receivables; (3) Each such Receivable (A) is payable, in an amount not less than its Expected Net Receivable, by the Payor identified by Borrower as being obligated with respect to such Receivable, (B) is based on an actual and bona fide rendition of services or sale of goods to a patient by Borrower in the ordinary course of its business, (C) is denominated and payable only in lawful currency of the United States, and (D) is an "account" within the meaning of the Uniform Commercial Code of the state in which the services or goods were provided or sold to the patient by Borrower and in which Borrower has its principal place of business, or is a right to payment under a policy of insurance or the proceeds thereof, and is not evidenced by an instrument or chattel paper unless specifically identified in writing to FINOVA; and there is no Payor other than the applicable Payor identified by Borrower as the Payor primarily liable, on any such Receivable; (4) No such Receivable is (A) subject to any audit, action, suit, proceeding or dispute (pending or threatened), set-off, counterclaim, defense, abatement, suspension, deferment, deductible, reduction or termination by the Payor (except as described in the Schedule), or (B) with respect to each Receivable for which FINOVA has advanced an amount greater than $10, within fewer than ninety (90) days prior to, or past, the statutory limit for collection applicable to the Payor; (5) Borrower does not have any guaranty of, letter of credit providing credit support for, or collateral security for, such Receivable, other than any such guaranty, letter of credit or collateral security as has been assigned to FINOVA, and any such guaranty, letter of credit or collateral security is not subject to any lien in favor of any other person; (6) To the best of Borrower's knowledge and belief the goods or services provided and creating such Receivable were medically necessary for the patient, and the patient has received such goods or services; (7) Where required by applicable law or contract, the fees charged for the goods or services constituting the basis for such Receivable are (a) consistent with the usual, customary and reasonable fees charged by other similar medical service providers in Borrower's community or the community in which the patient resides, whichever is less, of the same or similar service by Borrower or (b) pursuant to negotiated fee contracts, or imposed fee schedules, with or by the applicable Payors; (8) No action by Borrower or any Loan Party other than the execution and delivery of this Agreement and the other Loan Documents, the issuance and delivery of any required Payor Notices (in a form approved by FINOVA), the filing of UCC financing statements in the State in which the Borrower's principal place of business and chief executive office is located, and the delivery to FINOVA of any original instrument or chattel paper is required to perfect the first priority security interest of FINOVA in such Receivable, and all such actions have been or will be accomplished no later than the date of the initial Loan advance by FINOVA; (9) Each such Receivable complies, in all material respects which would affect the timely collectibility of such receivable, with all laws and regulations applicable thereto; (10) No such Receivable represents services or goods furnished or provided to or on behalf of any subsidiary, parent, or other entity or any Person affiliated with Borrower, and there is no Payor, other than as designated by Borrower, that is primarily liable on such Receivable; (11) The Payor with respect to each such Receivable is (A) not currently the subject of any bankruptcy, insolvency or receivership proceeding, nor is it unable to make payments on its obligations when due, (B) located in the United States, and (C) one of the following: (x) a party which in the ordinary course of its business or activities agrees to pay for healthcare services or goods received by individuals, including, without limitation, commercial insurance companies and non-profit insurance companies (such as Blue Cross and Blue Shield entities) issuing health, personal injury, worker's compensation or other types of insurance, employers or unions which self- insure for employee or member health insurance, prepaid healthcare organizations, preferred provider organizations, health maintenance organizations, group purchasing organizations, management/administrative service organizations, health care providers or any other similar persons, or (y) a Payor of the type described in the definition of Governmental Receivables; (12) The insurance policy, contract or other instrument obligating a Payor to make payment with respect to each such Receivable (A) except with respect to a Governmental Receivable, does not contain any provision prohibiting the transfer of such payment obligation from the patient to Borrower, (B) has been duly authorized and, together with such Receivable, constitutes the legal, valid and binding obligation of the Payor in accordance with its terms, (C) together with the applicable Receivable, does not contravene in any material respect any requirement of law applicable thereto, and (D) was in full force and effect at the time the services or goods rendered to the patient constituting the basis for such Receivable were performed; (13) Fees for services or goods which are subject to limitations imposed by contracts for reimbursement from the related Payor, or applicable law, do not exceed the limitations imposed thereunder, and each Receivable for which the fees are so restricted has been clearly identified to FINOVA as being subject to such restriction; (14) Except as limited in the case of Governmental Receivables: (A) Borrower has the right to pledge, collaterally assign and grant a security interest in each such Receivable to FINOVA pursuant to this Agreement; (B) no consent from the related Payor or any other person is required to create or perfect the first priority security interest granted in favor of FINOVA in any Receivable pursuant to this Agreement; and (C) such grant of a security interest to FINOVA in each such Receivable has been made in good faith by Borrower and without intent to hinder, delay or defraud present or future creditors of Borrower, and will constitute a valid and binding first priority security interest in such Receivable enforceable against Borrower any Loan Party and all creditors of and purchasers from Borrower senior and prior to all other assignments, liens or pledges thereof. With respect to Governmental Receivables, Borrower shall retain all rights of collection with respect thereto, subject to the provisions of the Depository Agreement; (15) There are no proceedings or investigations in which Borrower is named as party or any other proceedings or investigations pending or threatened before any Governmental Authority or any arbitration or similar proceedings under any contract (A) asserting the invalidity of such Receivable or any contract related thereto, (B) seeking the payment of such Receivable or any contract related thereto, or (C) seeking any determination or ruling that might materially and adversely affect the validity or enforceability of such Receivable or any contract related thereto; (16) No Receivable or contract related thereto contravenes in any material respect any federal, state or local law, rule or regulation applicable thereto (including, without limitation, the Social Security Act and the rules and regulations of HCFA under the Social Security Act, other federal and state laws and regulations pertaining to Medicare, Medicaid and other health care financing programs laws, rules and regulations relating to usury, consumer protection, truth in lending, fair credit billing, fair credit reporting, equal credit opportunity, fair debt collection practices and privacy), and no party to such related contract to the best of Borrower's knowledge is in violation of any such law, rule or regulation in any material respect; (17) All descriptions of such Receivable provided to FINOVA on behalf of Borrower remain true and correct and do not contain any untrue statement of a material fact or omit to state a material fact necessary to make the descriptions of or statements made therein not misleading; and If a breach of any of the representations or warranties contained herein relating to a Receivable may, in the Permitted Discretion of FINOVA, have a material adverse effect upon the validity, legality or collectibility of such Receivable then, such Receivable shall no longer be deemed, an "Eligible Receivable", as defined in Section 1.1 hereof.
Appears in 2 contracts
Samples: Loan and Security Agreement (Community Medical Transport Inc), Loan and Security Agreement (Community Medical Transport Inc)
Healthcare Representations and Warranties. A (a) Borrower owns or leases and operates facilities to provide health care services and (i) maintains Medicare and Medicaid provider status and is the holder of the provider identification numbers identified on Exhibit 7.1.26
(a) hereto, all of which are current and valid (except for any provider identification numbers which may have inadvertently and temporarily cease to be current or valid due to technical reasons (and not for cause) and which, individually or in the aggregate, would not have a Material Adverse Effect or materially and adversely affect any rights of Agent and/or Lenders hereunder, provided that Borrower, promptly upon learning of any such situation with respect to any provider identification number, shall correct all such technical problems and have any such provider identification number or similar substitute number reinstated or issued as current and valid) and, except as set forth on Exhibit 7.1.26
(a) hereto, Borrower has not allowed, permitted, authorized or caused any other Person to use any such provider identification number; (ii) has obtained all material licenses, accreditations and approvals of governmental authorities and all other Persons necessary for Borrower to own its assets, to carry on its business, to execute, deliver and perform the Loan Documents, and to receive payments from the Obligors; and (iii) is in compliance except where the effect of such noncompliance would not result in a Material Adverse Effect with all laws, rules, regulations, orders, decrees and directions of any Governmental Authority (including, without limitation, the Medicare Act, the rules and regulations of HCFA under the Medicare Act, and the applicable Medicaid laws) applicable to the Accounts or any contracts relating thereto, or applicable to the Borrower's business and properties, a violation of which would or could materially and adversely affect the Borrower's ability to carry out its Obligations hereunder with respect to the Accounts. In addition, Borrower has not been notified by any such Governmental Authority or other person during the immediately preceding 24 month period that such party has rescinded or not renewed, or intends to rescind or not renew, any such license or approval.
(b) The Medicaid and Medicare cost reports of each facility and of the home office of Borrower for all cost reporting periods have been submitted when and as required to (i) as to Medicaid, the state agency, or other HCFA-designated agent or agent of such state agency, charged with such responsibility or (ii) as to Medicare, the Medicare intermediary or other HCFA-designated agent charged with such responsibility. Borrower's cost reports do not indicate and no audit has resulted in any determination that Borrower was overpaid for Medicaid and Medicare in an aggregate amount of Two Million Dollars ($2,000,000.00) or more in any of the most recent three fiscal years covered by such audit. For the purposes of this subsection, the amounts of any overpayment for any particular matter which have been disclosed to Agent as of the Closing Date shall not be included in the calculation of the aggregate amount of overpayments; however, if a final determination is made at some time after the Closing Date that the total amount of the overpayment for any particular matter disclosed to Agent as of the Closing Date is greater than the amount which was disclosed as of the Closing Date, the excess of the amount as of the final determination over the amount disclosed to Agent as of the Closing Date shall be included in the calculation of the aggregate amount of overpayments under this subsection.
(c) With respect to each Receivableall Accounts, as of the date each such Receivable Account is created and included as an Eligible Receivable Account by FINOVAAgent, on behalf of and for the benefit of Lenders:
(1i) All documents and agreements relating to the Receivable Accounts requested by FINOVA Agent have been delivered to FINOVA Agent with respect to such Receivable Accounts and such documents are true and correct in all material respects; Borrower has timely and properly billed the applicable Payor Obligors of the Receivable Accounts (except where supporting claim documents must be forwarded to such Payor any Obligor before a xxxx may be submitted in which case Borrower shall promptly complete documentation and billing of such PayorsObligors), and Borrower has delivered or caused to be delivered to such Payor Obligors all Payor material Obligor requested supporting claim documents with respect to such Receivable Accounts including all material documentation required by the applicable Payor(s) Obligors for payment on the ReceivableAccounts, and the statutory period periods for issuing an explanation of benefits ("EOB") in connection with such Receivable has Accounts have not expired; and all information set forth in the xxxx bills and supporting claim documents submitted to a Payor Obligors with respect to such Receivable the Accounts is true, complete and correct in all material respects, and, if additional information is requested by such Payor any Obligor in connection therewith, Borrower will promptly provide the same and, if necessary, will rebill or, if requested by the primary servicer (if other than Borrower) cooperate with such servicer(s) to rebill any such Governmental ReceivableAccount;
(2ii) Each such Receivable is The Accounts are exclusively owned by Borrower, and there is no security interest in or lien against such Receivable the Accounts in favor of any third party other than FINOVAAgent, except for Permitted Liens, nor is there any recording or filing against Borrower, as debtor, covering or purporting to cover any interest of any kind in any Receivablethe Accounts, except as has been or will be released or terminated by each party holding such adverse interest in the Receivable Accounts prior to or concurrently with the initial Loan made by FINOVA Agent and Lenders to Borrower. Borrower shall defend the first priority security interest of FINOVA Agent, on behalf of Lenders, in all Receivables Accounts against the claims of all persons claiming any interest adverse to FINOVAAgent and Lenders. With respect to any Governmental Receivable Government Accounts the rights transferred to FINOVA Agent in connection with this Agreement do not include the right to claim payment in FINOVAAgent's name from the applicable Payor Obligor or the right to direct such Payor Obligor to remit payment directly to FINOVA Agent except as permitted by applicable laws and regulations governing such Governmental ReceivablesAccounts;
(3iii) Each such Receivable The Accounts (A) is payable, are payable in an amount not less than its Expected Net Receivable, full by the Payor Obligor identified by Borrower as being obligated with respect to such ReceivableAccount, (B) is based on an actual and bona fide rendition of services or sale of goods to a patient by Borrower in the ordinary course of its business, (C) is are denominated and payable only in lawful currency of the United States, and (DC) is an are "accountaccounts" within the meaning of the Uniform Commercial Code of the state in which the services or goods were provided or sold to the patient respective Patients or Obligors, as applicable, by Borrower and in which Borrower has its principal place of businesschief executive office, or is a right are rights to payment under a policy of insurance or the proceeds thereof, and is are not evidenced by an instrument or chattel paper unless specifically identified in writing to FINOVApaper; and there is are no Payor Obligors other than the applicable Payor Obligors identified by Borrower as the Payor Obligors primarily liable, on any such Receivablethe Accounts;
(4) No such Receivable is (A) subject to any audit, action, suit, proceeding or dispute (pending or threatened), set-off, counterclaim, defense, abatement, suspension, deferment, deductible, reduction or termination by the Payor (except as described in the Schedule), or (B) with respect to each Receivable for which FINOVA has advanced an amount greater than $10, within fewer than ninety (90) days prior to, or past, the statutory limit for collection applicable to the Payor;
(5iv) Borrower does not have any guaranty of, letter of credit providing credit support for, or collateral security for, such Receivablethe Accounts, other than any such guaranty, letter of credit creditor or collateral security as has been assigned to FINOVAAgent, and any such guaranty, letter of credit or collateral security is not subject to any lien Lien in favor of any other person;
(6v) To the best of Borrower's knowledge and belief the goods or services provided and creating such Receivable the Accounts were medically necessary for received by the patientrespective Patient or Obligor, and the patient has received such goods or servicesas applicable;
(7vi) Where required by applicable law or contract, the fees charged for the goods or services constituting the basis for such Receivable the Accounts are (a) consistent with the usual, customary and reasonable fees charged by other similar medical service providers or providers of similar goods and services, as applicable, in Borrower's community or the community in which the patient residesrespective Patient or Obligor, as applicable, resides or is located, whichever is less, of the same or similar service by Borrower or (b) pursuant to negotiated fee contracts, or imposed fee schedules, with or by the applicable PayorsObligors;
(8) vii) No action by Borrower or any Loan Party other than the execution and delivery of this Agreement and the other Loan Documents, the issuance and delivery of any required Payor Notices Obligor notices (in a form approved by FINOVA), Agent) and the filing of UCC financing statements in the State State(s) in which the Borrower's principal place of business and chief executive office is located, and the delivery to FINOVA of any original instrument or chattel paper is required to perfect the first priority security interest of FINOVA Agent in such Receivablethe Accounts, and all such actions have been or will be accomplished no later than the date of the initial Loan advance by FINOVAAgent, on behalf of and for the ratable benefit of Lenders;
(9viii) Each such Receivable compliesThe Accounts comply, in all material respects which would affect the timely collectibility of such receivableAccounts, with all laws and regulations applicable thereto;
(10ix) No such Receivable represents services or goods furnished or provided to or on behalf of any subsidiary, parent, or other entity or any Person affiliated with Borrower, and there is no Payor, other than as designated by Borrower, that is primarily liable on such Receivable;
(11) The Payor with respect to each such Receivable is (A) not currently the subject of any bankruptcy, insolvency or receivership proceeding, nor is it unable to make payments on its obligations when due, (B) located in the United States, and (C) one of the following: (x) a party which in the ordinary course of its business or activities agrees to pay for healthcare services or goods received by individuals, including, without limitation, commercial insurance companies and non-profit insurance companies (such as Blue Cross and Blue Shield entities) issuing health, personal injury, worker's compensation or other types of insurance, employers or unions which self- insure for employee or member health insurance, prepaid healthcare organizations, preferred provider organizations, health maintenance organizations, group purchasing organizations, management/administrative service organizations, health care providers or any other similar persons, or (y) a Payor of the type described in the definition of Governmental Receivables;
(12) The Any insurance policy, contract or other instrument obligating a Payor any respective Obligor to make payment with respect to each such Receivable (A) the Accounts, except with respect to a Governmental ReceivableAccounts, does not contain any provision prohibiting the transfer of such payment obligation from the patient a Patient to Borrower, (B) has been duly authorized and, together with such Receivable, constitutes the legal, valid and binding obligation of the Payor in accordance with its terms, (C) together with the applicable Receivable, does not contravene in any material respect any requirement of law applicable thereto, and (D) was in full force and effect at the time the services or goods rendered to the patient constituting the basis for such Receivable were performed;
(13x) Fees for services or goods which are subject to limitations imposed by worker's compensation regulations or by contracts for reimbursement from the related Payor, or applicable law, Obligor do not exceed the limitations imposed thereunder, and each Receivable the Accounts for which the fees are so restricted has been clearly identified to FINOVA Agent as being subject to such restriction;
(14xi) There are no Obligors, other than as designated by Borrower, that are primarily liable on the Accounts;
(xii) Except as limited in the case of Governmental Receivables:
(A) Borrower has the right to pledgeset forth on Exhibit 7.1.26(c), collaterally assign and grant a security interest in each such Receivable to FINOVA pursuant to this Agreement; (B) no consent from the related Payor or any other person is required to create or perfect the first priority security interest granted in favor of FINOVA in any Receivable pursuant to this Agreement; and (C) such grant of a security interest to FINOVA in each such Receivable has been made in good faith by Borrower and without intent to hinder, delay or defraud present or future creditors of Borrower, and will constitute a valid and binding first priority security interest in such Receivable enforceable against Borrower any Loan Party and all creditors of and purchasers from Borrower senior and prior to all other assignments, liens or pledges thereof. With respect to Governmental Receivables, Borrower shall retain all rights of collection with respect thereto, subject to the provisions of the Depository Agreement;
(15) There there are no proceedings or investigations in which Borrower is named as party or any other proceedings or investigations pending investigation ending or threatened before any Governmental Government Authority or any arbitration or similar proceedings under any contract (Aa) asserting the invalidity of such Receivable any of the Accounts or any contract contracts related thereto, (Bb) seeking the payment of such Receivable any of the Accounts or any contract related thereto, or (Cc) seeking any determination or ruling that might materially and adversely affect the validity or enforceability of such Receivable any of the Accounts or any contract contracts related theretothereto which, either individually or in the aggregate could have a Material Adverse Effect or could materially and adversely affect the rights of Agent and/or Lenders hereunder. Notwithstanding the foregoing, Exhibit 7.1.26(c) lists all such proceedings or investigations which have been instituted by any Government Authority in connection with healthcare-related laws, rules or regulations;
(16xiii) No Receivable None of the Accounts or contract contracts related thereto contravenes contravene in any material respect any federal, state or local law, rule or regulation applicable thereto (including, without limitation, the Social Security Medicare Act and the rules and regulations of HCFA under the Social Security Act, other federal Medicare Act and state laws and regulations pertaining to Medicare, Medicaid and other health care financing programs laws, rules and regulations relating to usury, consumer protection, truth in lending, fair credit billing, fair credit reporting, equal credit opportunity, fair debt collection practices and privacy), and no party to such related contract to the best of Borrower's knowledge is in violation of any such law, rule or regulation in any material respect;; and
(17xiv) All descriptions of such Receivable the Accounts provided to FINOVA Agent on behalf of Borrower remain true and correct and do not contain any untrue statement of a material fact or omit to state a material fact necessary to make the descriptions of or statements made therein not misleading; and . If a breach of any of the representations or warranties contained herein relating to a Receivable Account may, in the Permitted Discretion reasonable opinion of FINOVAAgent, have a material adverse effect upon the validity, legality or collectibility of such Receivable Account then, such Receivable Account shall no longer be deemed, an "Eligible ReceivableAccount", as defined in Section 1.1 hereofAppendix A herein.
Appears in 1 contract
Samples: Loan and Security Agreement (Gentiva Health Services Inc)
Healthcare Representations and Warranties. A (a) Each Borrower owns or leases and operates facilities to provide health care services and (i) maintains Medicare and Medicaid provider status and is the holder of the provider identification numbers identified on Exhibit 7.1.26
(a) hereto, all of which are current and valid (except for any provider identification numbers which may have inadvertently and temporarily ceased to be current or valid due to technical reasons (and not for cause) and which, individually or in the aggregate, would not have a Material Adverse Effect or materially and adversely affect any rights of Agent and/or Lenders hereunder, provided that Borrowers, promptly upon learning of any such situation with respect to any provider identification number, shall correct all such technical problems and have any such provider identification number or similar substitute number reinstated or issued as current and valid) and, except as set forth on Exhibit 7.1.26
(a) hereto, Borrowers have not allowed, permitted, authorized or caused any other Person to use any such provider identification number; (ii) has obtained all material licenses, accreditations and approvals of governmental authorities and all other Persons necessary for each Borrower to own its assets, to carry on its business, to execute, deliver and perform the Loan Documents, and to receive payments from the Obligors; and (iii) is in compliance, except where the effect of such noncompliance would not result in a Material Adverse Effect, with all laws, rules, regulations, orders, decrees and directions of any Government Authority (including, without limitation, the Medicare Act, the rules and regulations of CMMS under the Medicare Act, and the applicable Medicaid laws) applicable to the Accounts or any contracts relating thereto, or applicable to such Borrower's business and properties, a violation of which would or could materially and adversely affect such Borrower's ability to carry out its Obligations hereunder with respect to the Accounts. In addition, no Borrower has not been notified by any such Governmental Authority or other person during the immediately preceding 24 month period that such party has rescinded or not renewed, or intends to rescind or not renew, any such license or approval.
(b) The Medicaid and Medicare cost reports of each facility and of the home office of each Borrower for all cost reporting periods have been submitted when and as required to (i) as to Medicaid, the state agency, or other CMMS-designated agent or agent of such state agency, charged with such responsibility or (ii) as to Medicare, the Medicare intermediary or other CMMS-designated agent charged with such responsibility. Each Borrower's cost reports do not indicate and no audit has resulted in any final determination that any Borrower was overpaid for Medicaid and Medicare by One Million Dollars ($1,000,000.00) or more in any of the most recent three fiscal years covered by such audit.
(c) With respect to each Receivableall Accounts, as of the date each such Receivable Account is created and included as an Eligible Receivable Account by FINOVAAgent, on behalf of and for the benefit of Lenders:
(1i) All documents and agreements relating to the Receivable Accounts requested by FINOVA Agent have been delivered to FINOVA Agent with respect to such Receivable Accounts and such documents are true and correct in all material respects; , each Borrower has timely and properly billed the applicable Payor Obligors of the Receivable Accounts (except where supporting claim documents must be forwarded to such Payor any Obligor before a xxxx bill may be submitted in which case such Borrower shall promptly complete documentation and billing of such PayorsObligors), and each Borrower has delivered or caused to be delivered to such Payor Obligors all Payor material Obligor requested supporting claim documents with respect to such Receivable Accounts including all material documentation required by the applicable Payor(s) Obligors for payment on the ReceivableAccounts, and the statutory period for issuing an explanation of benefits ("EOB") in connection with such Receivable has Accounts have not expired; and all information set forth in the xxxx bills and supporting claim documents submitted to a Payor Obligors with respect to such Receivable the Accounts is true, complete and correct in all material respects, and, if additional information is requested by such Payor any Obligor in connection therewith, each Borrower will promptly provide the same and, if necessary, will rebill or, if requested by the primary servicer (if other than such Borrower) cooperate with such servicer(s) to rebill any such Governmental ReceivableAccount;
(2ii) Each such Receivable is The Accounts are exclusively owned by BorrowerBorrowers, and there is no security interest in or lien against such Receivable the Accounts in favor of any third party other than FINOVAAgent, nor is there any recording or filing against any Borrower, as debtor, covering or purporting to cover any interest of any kind in any Receivablethe Accounts, except as has been or will be released or terminated by each party holding such adverse interest in the Receivable Accounts prior to or concurrently with the initial Loan made by FINOVA Agent and Lenders to BorrowerBorrowers. Borrower Borrowers shall defend the first priority security interest of FINOVA Agent, on behalf of Lenders, in all Receivables Accounts against the claims of all persons claiming any interest adverse to FINOVAAgent and Lenders. With respect to any Governmental Receivable Government Accounts the rights transferred to FINOVA Agent in connection with this Agreement do not include the right to claim payment in FINOVAAgent's name from the applicable Payor Obligor or the right to direct such Payor Obligor to remit payment directly to FINOVA Agent except as permitted by applicable laws and regulations governing such Governmental ReceivablesAccounts;
(3iii) Each such Receivable The Accounts (A) is payable, are payable in an amount not less than its Expected Net Receivable, full by the Payor Obligor identified by Borrower Borrowers as being obligated with respect to such ReceivableAccount, (B) is based on an actual and bona fide rendition of services or sale of goods to a patient by Borrower in the ordinary course of its business, (C) is are denominated and payable only in lawful currency of the United States, and (DC) is an are "accountaccounts" within the meaning of the Uniform Commercial Code of the state in which the services each Borrower is incorporated or goods were provided or sold to the patient by Borrower organized and in which Borrower has its principal place of business, or is a right to payment under a policy of insurance or the proceeds thereof, and is are not evidenced by an instrument or chattel paper unless specifically identified in writing to FINOVApaper; and there is are no Payor Obligors other than the applicable Payor Obligors identified by Borrower Borrowers in its reports to Agent as the Payor Obligors primarily liable, liable on any such Receivablethe Accounts;
(4iv) No such Receivable is (A) subject to any audit, action, suit, proceeding or dispute (pending or threatened), set-off, counterclaim, defense, abatement, suspension, deferment, deductible, reduction or termination by the Payor (except as described in the Schedule), or (B) with respect to each Receivable for which FINOVA Borrower has advanced an amount greater than $10, within fewer than ninety (90) days prior to, or past, the statutory limit for collection applicable to the Payor;
(5) Borrower does not have any guaranty of, letter of credit providing credit support for, or collateral security for, such Receivablethe Accounts, other than any such guaranty, letter of credit creditor or collateral security as has been assigned to FINOVAAgent, and any such guaranty, letter of credit or collateral security is not subject to any lien Lien in favor of any other person;
(6v) To the best of Borrower's Borrowers' knowledge and belief the goods or services provided and creating such Receivable the Accounts were medically necessary for received by the patientrespective Patient or Obligor, and the patient has received such goods or servicesas applicable;
(7vi) Where required by applicable law or contract, the fees charged for the goods or services constituting the basis for such Receivable the Accounts are (a) consistent with the usual, customary and reasonable fees charged by other similar medical service providers or providers of similar goods and services, as applicable, in the applicable Borrower's community or the community in which the patient residesrespective Patient, resides or is located, whichever is less, of the same or similar service by the applicable Borrower or (b) pursuant to negotiated fee contracts, or imposed fee schedules, with or by the applicable PayorsObligors;
(8) vii) No action by Borrower or any Loan Party Borrowers other than the execution and delivery of this Agreement and the other Loan Documents, the issuance and delivery of any required Payor Notices Obligor notices (in a form approved by FINOVA), Agent) and the filing of UCC financing statements in the State in which the Borrower's principal place of business and chief executive office each applicable Borrower is locatedincorporated or organized, and the delivery to FINOVA of any original instrument or chattel paper is required to perfect the first priority security interest of FINOVA Agent in such Receivablethe Accounts, and all such actions have been or will be accomplished no later than the date of the initial Loan advance by FINOVAAgent, on behalf of and for the ratable benefit of Lenders;
(9viii) Each such Receivable compliesThe Accounts comply, in all material respects which would affect the timely collectibility of such receivableAccounts, with all laws and regulations applicable thereto;
(10ix) No such Receivable represents services or goods furnished or provided to or on behalf of any subsidiary, parent, or other entity or any Person affiliated with Borrower, and there is no Payor, other than as designated by Borrower, that is primarily liable on such Receivable;
(11) The Payor with respect to each such Receivable is (A) not currently the subject of any bankruptcy, insolvency or receivership proceeding, nor is it unable to make payments on its obligations when due, (B) located in the United States, and (C) one of the following: (x) a party which in the ordinary course of its business or activities agrees to pay for healthcare services or goods received by individuals, including, without limitation, commercial insurance companies and non-profit insurance companies (such as Blue Cross and Blue Shield entities) issuing health, personal injury, worker's compensation or other types of insurance, employers or unions which self- insure for employee or member health insurance, prepaid healthcare organizations, preferred provider organizations, health maintenance organizations, group purchasing organizations, management/administrative service organizations, health care providers or any other similar persons, or (y) a Payor of the type described in the definition of Governmental Receivables;
(12) The Any insurance policy, contract or other instrument obligating a Payor any respective Obligor to make payment with respect to each such Receivable (A) the Accounts, except with respect to a Governmental ReceivableAccounts, does not contain any provision prohibiting the transfer of such payment obligation from the patient a Patient to Borrower, (B) has been duly authorized and, together with such Receivable, constitutes the legal, valid and binding obligation of the Payor in accordance with its terms, (C) together with the applicable Receivable, does not contravene in any material respect any requirement of law applicable thereto, and (D) was in full force and effect at the time the services or goods rendered to the patient constituting the basis for such Receivable were performedBorrowers;
(13x) Fees for services or goods which are subject to limitations imposed by worker's compensation regulations or by contracts for reimbursement from the related Payor, or applicable law, Obligor do not exceed the limitations imposed thereunder, and each Receivable the Accounts for which the fees are so restricted has have been clearly identified to FINOVA Agent as being subject to such restriction;
(14xi) There are no Obligors, other than as designated by Borrowers, that are primarily liable on the Accounts;
(xii) Except as limited in the case of Governmental Receivables:
(A) Borrower has the right to pledgeset forth on Exhibit 7.1.26(c), collaterally assign and grant a security interest in each such Receivable to FINOVA pursuant to this Agreement; (B) no consent from the related Payor or any other person is required to create or perfect the first priority security interest granted in favor of FINOVA in any Receivable pursuant to this Agreement; and (C) such grant of a security interest to FINOVA in each such Receivable has been made in good faith by Borrower and without intent to hinder, delay or defraud present or future creditors of Borrower, and will constitute a valid and binding first priority security interest in such Receivable enforceable against Borrower any Loan Party and all creditors of and purchasers from Borrower senior and prior to all other assignments, liens or pledges thereof. With respect to Governmental Receivables, Borrower shall retain all rights of collection with respect thereto, subject to the provisions of the Depository Agreement;
(15) There there are no proceedings or investigations in which any Borrower is named as party or any other proceedings or investigations pending investigation ending or threatened before any Governmental Government Authority or any arbitration or similar proceedings under any contract (Aa) asserting the invalidity of such Receivable any of the Accounts or any contract contracts related thereto, (Bb) seeking the payment of such Receivable any of the Accounts or any contract related thereto, or (Cc) seeking any determination or ruling that might materially and adversely affect the validity or enforceability of such Receivable or any contract related thereto;
(16) No Receivable or contract related thereto contravenes in any material respect any federal, state or local law, rule or regulation applicable thereto (including, without limitation, the Social Security Act and the rules and regulations of HCFA under the Social Security Act, other federal and state laws and regulations pertaining to Medicare, Medicaid and other health care financing programs laws, rules and regulations relating to usury, consumer protection, truth in lending, fair credit billing, fair credit reporting, equal credit opportunity, fair debt collection practices and privacy), and no party to such related contract to the best of Borrower's knowledge is in violation of any such law, rule or regulation in any material respect;
(17) All descriptions of such Receivable provided to FINOVA on behalf of Borrower remain true and correct and do not contain any untrue statement of a material fact or omit to state a material fact necessary to make the descriptions of or statements made therein not misleading; and If a breach of any of the representations Accounts or warranties contained herein relating to a Receivable mayany contracts related thereto which, either individually or in the Permitted Discretion of FINOVA, aggregate could have a material adverse effect upon Material Adverse Effect or could materially and adversely affect the validityrights of Agent and/or Lenders hereunder. Notwithstanding anything to the contrary contained in the foregoing, legality or collectibility of such Receivable then, such Receivable shall no longer be deemed, an "Eligible Receivable", as defined in Section 1.1 hereof.Exhibit 7.1.26
Appears in 1 contract
Samples: Loan and Security Agreement (Gentiva Health Services Inc)
