Exhibit 10.15
EXCLUSIVE SERVICES PROVIDER AGREEMENT
This Exclusive Services Provider Agreement is made as of August 1, 1997,
by and between Medical Billing Services of Arizona, Inc., a Delaware
corporation ("MBSN"), and National Medical Financial Services Corporation, a
Nevada corporation ("NMFSC").
Whereas, NMFSC has assumed the obligations of Desert Health Resources,
Inc. ("DHR") with respect to billing and collecting fees for medical services
on or after August 1, 1997 expressly set forth in writing in the contracts
listed on Exhibit A hereto (the "Contracts") other than obligations which DHR
was obliged to perform, pay or discharge prior to August 1, 1997 (the
"Contracted Services");
Whereas, NMFSC desires to retain MBSN to provide the Contracted Services
to the clients designated in the respective Contracts (the "Clients"); and
Whereas, MBSN is willing to provide the Contracted Services on the terms
and subject to the conditions set forth in this Agreement;
Now, therefore, MBSN and NMFSC agree as follows:
1. Billing, Collection and Accounts Receivable Management Services.
1.1 MBSN Services. MBSN will provide the Contracted Services
specified in each of the Contracts to the Client identified in such Contract.
1.2 Exclusivity. NMFSC will not authorize any other entity or
person to provide, and NMFSC will not provide, any of the Contracted Services
to any Client without MBSN's prior written consent.
1.3 Client Data. NMFSC hereby assigns to MBSN all of NMFSC's
rights pursuant to the Contracts to use for the purposes contemplated by this
Agreement any billing data, patient data, insurance data or other data or
information furnished or to be furnished by or on behalf of any Client
("Billing Data"). NMFSC hereby assigns to MBSN all representations,
warranties and covenants of each Client contained in the Contracts with
respect to such Client's Billing Data. NMFSC will promptly deliver to MBSN
all Billing Data in NMFSC's custody or control, and NMFSC will, upon request
by MBSN, direct any Client to deliver to MBSN any Billing Data that such
Client is required to deliver to DHR pursuant to such Client's Contract.
1.4 Contracts. NMFSC will not, without MBSN's prior written
consent, amend, or waive any provision of, any Contract or assign any
interest in any of NMFSC's rights pursuant to the Contracts to payment for
rendering any of the Contracted Services.
2. Client Obligations. MBSN's obligation to provide Contracted
Services to any Client is subject to the condition that such Client perform
all obligations of such Client contained in such Client's Contract in
accordance with the terms and conditions of such Contract. NMFSC will take
all actions reasonably requested by MBSN to compel the Clients to perform
their obligations in accordance with their respective Contracts.
3. Compensation of MBSN.
3.1 Estimated Payment. NMFSC will pay to MBSN in advance (the
"Estimated Payment") (a) for October 1997 on or before October 1, 1997 the
sum of $105,000 and (b) for each subsequent calendar month during the term of
this Agreement on or before the first business day of each such month an
amount equal to seventy percent (70%) of the amount of fees (net of refunds)
collected by or for the account of NMFSC during the preceding calendar month
for Contracted Services.
3.2 Reconciliation. If the product (the "Product") of (a) seventy
percent (70%) times (b) the amount of fees (net of refunds) collected by or
for the account of NMFSC during any calendar month during the term of this
Agreement for Contracted Services is greater than the Estimated Payment paid
for such month, NMFSC will pay to MBSN the remainder of (i) such Product
minus (ii) such Estimated Payment on or before the fifteenth day of the
following month. If the Product for any such month is less than the
Estimated Payment paid for such month, MBSN will refund to NMFSC the
remainder of (a) such Estimated Payment minus (b) such Product on or before
the fifteenth day of the following month. Sums payable pursuant to this
Section 3.2 shall be subject to a late payment fee of one percent (1%) per
month or the highest legal rate, whichever is lower.
3.3 Breach. In the event NMFSC is more than thirty (30) days late
in paying any amount payable pursuant to Section 3.1 or Section 3.2, MBSN may
cease providing Contracted Services in addition to any other remedy available
to MBSN for such breach.
4. Collection and Disposition of Client Fees. NMFSC authorizes MBSN to
collect for NMFSC's account, and NMFSC will upon request by MBSN direct each
Client to pay to MBSN for NMFSC's account, all fees payable after September
30, 1997 by such Client for Contracted Services pursuant to such Client's
Contract (the "Client Fees"). MBSN will deliver to NMFSC all Client Fees
received by MBSN during October 1997 or any subsequent calendar month during
the term of this Agreement on or before the third business day following the
later of (a) the last day of such month and (b) the date on which MBSN
receives payment in full of the Estimated Payment for the following month.
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5. Taxes. NMFSC agrees to pay any taxes, duties or other assessments
resulting from this Agreement or MBSN's provision of Contracted Services
under this Agreement, including sales, use, ad valorem, business privilege or
similar taxes, except taxes based on MBSN's net income or business privilege
taxes based on transaction of business by MBSN, unless NMFSC furnishes MBSN
with a valid tax exemption certificate. If required by appropriate taxing
authorities, MBSN will collect such taxes from NMFSC. MBSN agrees to give
prompt notice to NMFSC if it receives a formal notice that such taxes are
due, and NMFSC agrees to reimburse MBSN in full if MBSN must make the payment
for any such taxes, including without limitation all penalties and interest.
6. Warranty Disclaimer; Limitation of Remedy; Exclusion and Limitation
of Liability.
6.1 Warranty; Disclaimer of Warranty. MBSN will perform the
Contracted Services with reasonable skill and diligence and in a commercially
reasonable manner. MBSN makes no other warranty with respect to the
Contracted Services to be provided hereunder. ALL WARRANTIES, INCLUDING BUT
NOT LIMITED TO THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A
PARTICULAR PURPOSE AND WARRANTIES ARISING FROM COURSE OF DEALINGS OR USAGE OF
TRADE ARE HEREBY EXCLUDED. MBSN does not warrant the amount of collections
that will be achieved based on Contracted Services to be provided hereunder.
6.2 Limitation of Remedy. In the event that MBSN fails to perform,
in conformance with the provisions of this Agreement, any service required to
be provided by MBSN pursuant to this Agreement, NMFSC's exclusive remedy
(except as provided in Section 7.1) for such non-performance or other breach
by MBSn will be that NMFSC may require MBSN to promptly provide such service
in conformance with the provisions of this Agreement; provided, however, that
if such exclusive remedy fails of its essential purpose NMFSC may recover
damages caused by such breach subject to the limitations set forth in Section
6.3 of this Agreement.
6.3 Exclusion and Limitation of Liabilities. MBSN will have no
liability for consequential, incidental or punitive damages in any action
arising out of this Agreement or any service to be provided by MBSN pursuant
to this Agreement, including but not limited to actions for breach of
contract or in tort. If MBSN fails to perform, in conformance with the
provisions of this Agreement, any service that MBSN is required to provide
pursuant to this Agreement, MBSN's liability for damages for such breach will
be limited to the direct damages (excluding loss of profit) actually
resulting to NMFSC from such breach.
7. Termination.
7.1 Termination. Either party may terminate this Agreement
by written notice in the event that the other party breaches any
obligation of such party pursuant to this
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Agreement and such breach is not cured within thirty (30) days after notice
of such breach is given to such other party.
7.2 Return of Materials. Upon the termination of this Agreement
MBSN will promptly return, at NMFSC's expense, all copies of documents, data,
computer tapes and other materials containing Billing Data to NMFSC and
destroy, erase, delete, or otherwise render unusable all cards, tapes, floppy
disks and any other storage medium containing Billing Data.
8. Material Changes. In the event of a significant change in any
insurance, tax, third party reimbursement or other law, regulation, policy or
procedure that materially and adversely affects the feasibility or cost of
MBSN's provision of services pursuant to this Agreement, MBSN may terminate
this Agreement upon sixty (60) days prior notice.
9. Justifiable Delay and Non-Performance. Neither party will be liable
for any failure to perform or delay in performing any obligation of such
party pursuant to this Agreement resulting from any cause beyond the
reasonable control of the non-performing or delaying party, including, but
not limited to, computer malfunction or breakdown. In the event of a delay
in performance due to any such cause, the time for performance will be
extended for a period reasonably necessary to overcome the effect of such
cause.
10. Right to Audit Client Fees.
10.1 Audit by MBSN. MBSN may, at MBSN's expense, on one occasion
during any calendar year have an independent accountant conduct, upon not
less than five (5) business days prior notice to NMFSC and during normal
business hours, an audit of the fees collected by NMFSC for Contracted
Services. MBSN will maintain, and will cause such independent accountant to
agree with NMFSC in writing to maintain, the confidentiality of all
information obtained by such independent accountant in the course of any such
audit.
10.2 Audit by NMFSC. NMFSC may, at NMFSC's expense, on any
reasonable time or times during the term of the Agreement, have an
independent accountant conduct, upon not less than five (5) business days
prior notice to MBSN and during normal business hours, an audit of the Client
Fees collected by MBSN for NMFSC's account pursuant to this Agreement. NMFSC
will maintain, and will cause such independent accountant to agree with MSBN
in writing to maintain, the confidentiality of all information obtained by
such independent accountant in the course of any such audit.
11. Right of First Refusal. If NMFSC or any subsidiary or other
affiliate of NMFSC (the "Offeror") enters into any agreement or other
arrangement with any Client or an affiliate of any Client (other than the
Contracts) during the term of this Agreement pursuant to which the Offeror is
to be compensated for providing any billing, collection or accounts
receivable management services, the Offeror will offer MBSN the option to
provide such services on the
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terms (including but not limited to terms as to compensation of MBSN) and
conditions set forth in this Agreement with respect to MBSN's provision of
the Contracted Services.
12. Arbitration. Any controversy or dispute between NMFSC and MBSN
relating to this Agreement will be finally settled by binding arbitration in
accordance with the commercial arbitration rules of the American Arbitration
Association held in Las Vegas, Nevada. Judgment upon any award made in any
such arbitration may be entered and enforced in any court of competent
jurisdiction.
13. No Publicity. Neither party will disclose the existence or terms of
this Agreement without the prior written consent of the other party, except
to any permitted assignee, permitted delegatee or affiliate of such party or
to any governmental or other regulatory agency to the extent required by
applicable law or regulation.
14. Notice. All notices, demands and other communications hereunder
("Notices") shall be written and shall be deemed to have been duly given if
delivered in person, mailed in the country in which the addressee is located
(registered or certified mail, postage prepaid, return receipt requested),
sent via an internationally recognized courier service or sent by cable,
telex, facsimile transmission or other electronic means of written
communication and confirmed in a writing sent by the close of business on the
next following business day via an internationally recognized courier service
as follows:
To NMFSC: National Medical Financial
Services Corporation
0000 Xxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxx 00000
Attention: President
To MBSN: Medical Billing Services of Arizona, Inc.
000 Xxxx Xxxxxxxx Xxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxxxxxx X. Xxxxxxxx, President
or to such other address as NMFSC or MBSN may designate by notice to the
other, except that Notices of change of address shall only be effective upon
receipt.
15. Independent Contractor. MBSN is acting as an independent contractor
with respect to all matters arising out of its performance under this
Agreement, and will not be considered an agent, partner, joint venturer or
"affiliated services group" with or for NMFSC.
16. Nonsolicitation. NMFSC acknowledges that MBSN has made a
significant investment in the development of its business, including the
training of its employees. Therefore, during the term of this Agreement and
for one (1) year thereafter, NMFSC agrees
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not to directly or indirectly solicit or employ any MBSN employee without the
prior written consent of MBSN.
17. Assignment. NMFSC may not assign or delegate any of its rights or
obligations pursuant to this Agreement without the prior written consent of
MBSN. Any or all of MBSN's rights and obligations under this Agreement may
be assigned or delegated by it in its sole discretion.
18. Governing Law. This Agreement will be governed by the law of the
State of Nevada, without regard to its choice of law provisions.
19. Miscellaneous.
19.1 This Agreement embodies the entire understanding and agreement
of the parties with respect to the subject matter hereof and may not be
altered or modified in any manner except by a written agreement signed by
both parties.
19.2 No delay or omission on the part of either party in exercising
any right hereunder shall operate as a waiver of such right or any other
right of such party, nor shall any delay, omission or waiver on any one
occasion be deemed a bar to or waiver of the same or any other right on any
future occasion.
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In witness whereof, the parties hereto have duly executed this Agreement
as of the day and year first above written.
MEDICAL BILLING SERVICES OF ARIZONA, INC.
By:/s/ Xxxxxxxxxxx X. Xxxxxxxx
-------------------------------
President
NATIONAL MEDICAL FINANCIAL SERVICES
CORPORATION
By:/s/ Xxxxxxx X. Xxxxxxx, M.D.
-------------------------------
President
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