Common use of Working Capital Requirements Clause in Contracts

Working Capital Requirements. The Contractor must demonstrate and maintain working capital as specified below. For the purposes of this Contract, working capital is defined as current assets minus current liabilities. Throughout the terms of this Contract, the Contractor must maintain a positive working capital, subject to the following conditions: a. If a Contractor's working capital falls below zero, the Contractor must immediately notify EOHHS and submit for EOHHS approval a written plan within 30 days of findings, addressing the action steps being taken to reestablish a positive working capital balance. b. EOHHS may take any action it deems appropriate, including termination of the Contract, if the Contractor: (1) Fails to report a negative working capital balance that is subsequently identified through an audit; (2) Does not propose a plan to reestablish a positive working-capital balance within a reasonable period of time as determined by EOHHS; (3) Violates a corrective plan approved by EOHHS or (4) EOHHS determines that negative working capital cannot be corrected within a reasonable amount of time as determined by EOHHS. c. Notwithstanding the foregoing, CMS may take any action it deems appropriate, at any time, in order to protect beneficiary access to needed medical care.