Exhibit 10.01
MEDICAL CAPITAL CORPORATION
MASTER SERVICE AGREEMENT
THIS MASTER SERVICE AGREEMENT, including the Exhibits and Appendices
attached hereto ("Agreement"), is entered into among: MEDICAL CAPITAL
CORPORATION ("Company"), and MEDICAL TRACKING SERVICES, INC. ("Servicer")
effective _____________.
STATEMENT OF PURPOSE
The Company desires to engage Servicer to provide certain services related
to the processing and servicing Healthcare and other types of Business Accounts
Receivable, pursuant to the First Amended Note Issuance and Security Agreement
between Company and Zions First National Bank ("Trustee").
ARTICLE I
AGREEMENT
In consideration of the mutual covenants set forth below and other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto, intending to be legally bound, hereby agree as
follows:
ARTICLE II
SCOPE
SECTION 2.01. MASTER SERVICE AGREEMENT. This Agreement outlines the overall
responsibilities and relationships between the Company and the Servicer as
regards the acquisition by Company of accounts receivables and the provision of
specific functions and services by Servicer as outlined in detail under one of
the following Component Agreements, as may be entered into from time to time.
SECTION 2.02. ADMINISTRATIVE SERVICES AGREEMENT. Agreement covering
determination of the Expected Net Receivable, reporting of anticipated
reimbursement and issuance of checks on new work referred to Servicer by
Company.
ARTICLE III
DEFINITIONS
SECTION 3.01. GENERAL. Except as otherwise specified or as the context may
otherwise require, the following terms have the respective meanings set forth
below for all purposes of this Agreement, and the definitions of such terms are
equally applicable to all genders of such terms.
"Affiliate of Any Specified Person" means any person directly or indirectly
controlling or controlled by or under direct or indirect common control with
such specified person. Control means the power to direct the management and
policies of such person.
"Agreement" means this Master Service Agreement dated as of ________ __,
2003, between the Company and Servicer, as amended, supplemented or otherwise
modified from time to time.
"Asset" shall have the meaning set forth in Section 3.01(b) of the Note
Issuance and Security Agreement.
"Batch" means a group of Receivables purchased by the Company from a single
Client on a particular date.
"Business" means any for-profit or not-for-profit commercial organization.
"Business Account Client" means a Business which is acceptable to Servicer
and which has entered into a Purchase Agreement.
"Business Account Obligor" means any payor or obligor which in the ordinary
course of its business or activities agrees to pay for business goods and
services received by a Business or individuals.
"Business Account Receivables" means, with respect to each Business Account
Client, the business accounts existing or hereafter created on the records of
such Business Accounts Client, any and all rights to receive payments due on
such accounts from any Business Account Obligor under or in respect of such
account and all proceeds in any way derived, whether directly or indirectly,
from any of the foregoing.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and Friday
which is a day on which banking institutions in the city of Reno, Nevada, or the
city where the corporate trust office or the corporate trust operations office
for the Trustee are located and are authorized or obligated by law or executive
order to close.
"Cash Percentage" or "Advance Rate" means a designated percentage
established for a Client in the Purchase Agreement or other agreement by and
between the Company and its Client(s) which percentage shall be identified by
the Company to Servicer for each such Client(s).
"Cash Portion" or "Cash Advance" with respect to a Receivable means the
Cash Percentage multiplied by the Expected Net Receivable with respect to each
such Receivable.
"Client" means either a Health Care Client or a Business Account Client.
"Collateral" has the meaning set forth in the Note Issuance and Security
Agreement.
"Compensable Receivables" means all Receivables purchased by the Company
and submitted by the Company to the Servicer for servicing or as described in
the Purchase Agreement as Eligible Receivables (as defined in the Purchase
Agreement). However, with respect to a skilled nursing facility or a nursing
home, room and board charges for each patient during any calendar month shall be
deemed to be a single Compensable Receivable notwithstanding purchases by the
Company of such Healthcare Receivables on a weekly basis during a calendar
month.
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"Component Agreements" means the Administrative Services Agreement by and
between Medical Capital Corporation and the Company.
"Default" means any occurrence that is, or with notice or the lapse of time
or both would become, an Event of Default.
"Effective Date" means the date of execution and delivery of this
Agreement.
"Event of Default" by Servicer has the meaning specified in Section 7.01.
"Event of Default" by the Company has the meaning specified in Section
7.02.
"Expected Net Receivable (ENR)" with respect to a Receivable, means an
amount for such Receivable which shall be calculated by Servicer by: multiplying
the Advance Rate determined by the Company, or its Administrator or authorized
agent(s), by the gross amount of such Receivable.
"Federal and/or State Client Identification Number" means the Federal
Employer Identification Number as issued to the Client by the Internal Revenue
Service and/or the Client's corresponding Medicare or Medicaid identification
number and/or the Client's state issued vendor or payee identification number.
"Government Entity" means the United States of America, any state, and any
agency or instrumentality of the United States of America or any state which is
obligated to make any payment with respect to Medicare, CHAMPUS, Medicaid, a
State Health Title Program and any other type of Receivable representing amounts
owing under any program established by federal or state law, including CHAMPUS
as set forth in Title 10, U.S.C. Section 1071 et. seq., and the program set
forth in Title 3, I.S.C Section 1713.
"Health Care Client" means a hospital, medical practitioner, nursing home,
professional service corporation, clinic, medical group or any other client of
healthcare goods or services, each of which is acceptable to Servicer as
identified by a Federal and/or State Client Identification Number, or a separate
geographic location and which has entered into a Purchase Agreement.
"Healthcare Receivables" means, with respect to each Health Care Client,
the patient accounts existing or hereafter created on the records of such Health
Care Client, any and all rights to receive payments due on such accounts from
any Healthcare Insurer or Healthcare Obligor under or in respect of such account
and all proceeds in any way derived, whether directly or indirectly, from any of
the foregoing.
"Healthcare Insurer" or "Healthcare Obligor" means any payor or obligor
which in the ordinary course of its business or activities agrees to pay for
healthcare goods and services received by individuals, including a commercial
insurance company, a nonprofit insurance company (such as Blue Cross/Blue Shield
entity), an employer or union which self-insures for employee or member health
insurance and a health maintenance organization approved by the Company other
than a Governmental Entity which is responsible for payment of all or any
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portion of a Healthcare Receivable. An Insurer includes any insurance companies
issuing health, personal injury, workmen's compensation or other types of
insurance, but does not include any individual guarantors or obligors.
"Lockbox Account" means a lockbox account established by pursuant to the
Note Issuance and Security Agreement between the Company, the Trustee, or the
Servicer on behalf of the Company, for the collection of Receivables purchased
by the Company.
"Medicare and Medicaid Receivables" means a Healthcare Receivable
representing a claim against a Governmental Entity pursuant to the Medicare
program (as set forth in Title 42 U.S.C. Section 1395 et. seq.) or the Medicaid
Program (as set forth in Title 42 U.S.C. Section 1396 et. seq.).
"Note Issuance and Security Agreement" means the Note Issuance and Security
Agreement dated as of ________ __, 2003 by and between the Company and Zions
First National Bank, as Trustee, as amended from time to time.
"Obligor" includes either a Healthcare Obligor or a Business Account
Obligor.
"Officer" means, with respect to any entity, the Chairman of the Board,
President, or a Vice President, the Treasurer, an Assistant Treasurer, the
Secretary or an Assistant Secretary of the applicable corporation.
"Officer's Certificate" means a certificate that has been signed on behalf
of the Servicer by an individual who is identified in that certificate as an
Officer of the Servicer.
"Participation Interest" with respect to a Receivable, means a percentage
which will be identified by the Company to Servicer with respect to such
Receivable purchased by the Company or its designee which percentage will be
used pursuant to the Purchase Agreement to determine the amount collected with
respect to such Receivables in excess of the Sharing Breakpoint to be paid to
the Client.
"Person" means any individual, corporation, partnership, joint venture,
association, joint stock company, trust, limited liability company,
unincorporated organization or government or any agency or political subdivision
thereof.
"Purchase Agreement" means the agreement between the Company and a Client
pursuant to which the Client agrees to sell the Company its Receivables
substantially in the form set forth in Exhibit A hereto.
"Purchased Account File" means, with respect to each Receivable purchased
by the Company, the related billing and invoicing forms, patient consent to
payment and all other medical documents and authorizations necessary to obtain
payment from any Obligor.
"Receivable" means any Healthcare Receivable or Business Account
Receivable.
"Repurchase Price" with respect to an Unacceptable Account, means an amount
equal to (a) the Sharing Breakpoint for such Unacceptable Account plus (b)
interest equal to 18% per annum or such lesser rate identified to Servicer by
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the Company on such difference from and including the date that payment of the
Repurchase Price is demanded to the date the Repurchase Price is paid.
"Sharing Breakpoint" with respect to a Receivable, means an amount equal to
the Expected Net Receivable for such Receivable, multiplied by a fraction (the
numerator of which is the Cash Percentage and the denominator of which is the
Participation Interest); provided, however, that after a Client has ceased
selling Receivables to the Company or the Company has ceased purchasing
Receivables from a Client, the Company shall combine all Receivables for which
there has been no final settlement, and treat such Receivables as a single
Receivable, at which time the Sharing Breakpoint will become the total Expected
Net Receivable of all previously unpaid Receivables of such Client, multiplied
by a fraction (the numerator of which is the Cash Percentage and the denominator
of which is the weighted average of the Participation Interest for all of such
combined Receivables of such Client). The Company shall give Servicer written
notice indicating when the above provision is to be used in the preparation of
reports by Servicer.
"State Health Title Program" means any Medicare or other state-administered
or state-funded program that provides health care services.
"Trustee" means the designated entity acting as trustee under the Note
Issuance and Security Agreement pursuant to which the Company is purchasing
Receivables.
"Unacceptable Account" means a Receivable purchased by the Company for
which there has been an uncured breach of a representation or warranty by the
client pursuant to the terms of the Purchase Agreement and a Receivable which is
not included in any of the collateral coverage ratios set forth in the Note
Issuance and Security Agreement.
ARTICLE IV
SERVICES PROVIDED BY SERVICER RELATED TO: PURCHASE OF HEALTHCARE AND OTHER
TYPES OF BUSINESS ACCOUNTS RECEIVABLE AND SERVICING, TRACKING AND REPORTING ON
OTHER FORMS OF COLLATERAL
SECTION 4.01. OBTAINING HEALTHCARE AND OTHER TYPES OF BUSINESS ACCOUNTS
RECEIVABLE DATA RECORDS. The Company or its designee will instruct each Client
to furnish Servicer with all information and data relating to each Compensable
Receivable which is necessary for the Servicer to perform its duties as
described in the relevant Exhibits attached to this Agreement for each Component
Agreement. In the event the information or data provided by the Client to
Servicer requires clarification, Servicer will communicate directly with the
Client to obtain such clarification.
SECTION 4.02. REPORTING ON RECEIVABLES. In addition to the information set
forth and described in the relevant Exhibit for each Component Agreement to the
extent required (a) for the preparation of the required reports (to the extent
that such information is different from prior information submitted to
Servicer); (b) for Servicer to identify the Client and its receivables and to
set it up on its systems; and (c) for Servicer to identify the parameters that
the Company utilizes for entering into transactions with such Client, Company
will assure the required information is timely supplied to Servicer by Company
or Client.
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SECTION 4.03. POSSESSION OF RECEIVABLE DOCUMENTS. Unless otherwise
specified herein, for two years from the resolution of the claim represented by
the respective Compensable Receivable for which Servicer has provided servicing
or billing services, servicer shall maintain, for the benefit of the Company and
the Trustee on behalf of the trust created under the Note Issuance and Security
Agreement, physical possession of good and legible copies (which copies may
consist of or electronic media) of the Purchased Account File with respect to
each Compensable Receivable purchased by the Company, together with such other
instruments or documents that modify or supplement the Purchased Account File
and all other instruments and documents generated by or coming into the
possession of Servicer that are required to document or service such Receivable;
including, but not limited to, insurance claim files, ledger showing payment
records, the premium receipts, correspondence and current and historical
computerized data files, whether developed or originated by Servicer or others
who have delivered such items to Servicer. No earlier than the end of 24 months
from the date on which the respective Compensable Receivable was purchased by
the Company, Servicer will notify the Company of the proposed destruction of the
foregoing documents and electronic media and, if requested by the Company within
10 days of the Company's receipt of such notification, transfer physical
possession of the foregoing documents and electronic media to the Company or the
applicable Client. Any such transfer shall be at the Company's cost. If the
Company does not request such transfer within such 10-day periods, Servicer may
destroy such documents and electronic media. Prior to destruction, each
Purchased Account File shall remain the property of the Company regardless of
whether Servicer or the Company has physical possession.
SECTION 4.04. DATA PROCESSING OF INFORMATION SUPPLIED PURSUANT TO SECTION
4.01 AND SECTION 4.02. Servicer shall enter into the applicable tracking system,
either by electronic data interchange or manually the accounts receivable data
necessary to adequately and properly service, monitor and report on the
receivables delivered to Servicer pursuant to Section 4.01 above. Servicer will
make every effort to maintain data in a manner that complies with all federal
and state requirements regarding maintaining the confidentiality of the contents
of the receivables files.
SECTION 4.05. IMPLEMENTATION OF PROCEDURES AT CLIENT'S LOCATION. Company,
or its assigns, assisted by Servicer, shall use reasonable efforts and resources
to cause Clients to implement appropriate procedures and processes in their
offices for the purpose of maintaining adequate records of the collateral
pledged to the Company. The Company will also make reasonable demands to cause
the Clients to exercise due care and custodianship of the collateral so as to
ensure it is adequately insured and that adequate safekeeping measures are taken
to preserve its value.
SECTION 4.06. SERVICER'S FEES. Servicer shall be compensated for providing
a variety of services in the method outlined below:
(a) Servicer is to be paid a fee of $1,500 (one thousand five hundred)
per new client for establishing a new claims management account in its
claims management computer system.
(b) Servicer is to be paid a fee of $1,500 (one thousand five hundred)
per new client for establishing a new electronic data interface between the
new client's billing system and the tracking system of Servicer.
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(c) Servicer is to be paid a fee of $2.00 per claim posted on its
tracking system. This posting process includes the entering on the tracking
system of the billing charges and also entering on the tracking system the
payments received from the various payors. This charge is the same if the
entries are facilitated manually, or by electronic data interface posting.
This charge also applies if the client provides the Servicer with billing
claims that duplicate the claims that have been previously provided to the
Servicer.
(d) Servicer is to be paid $.15 per page copied of various documents,
reports or information.
(e) Servicer is to be paid a fee of a minimum charge of $200 per month
for tracking and reporting on each individual client. This minimum fee is
to cover the Servicer's administrative, equipment and other overhead costs.
ARTICLE V
COVENANTS
SECTION 5.01. CORPORATE EXISTENCE: SERVICER. Servicer shall keep in full
force and effect its existence and good standing as a corporation under the laws
of the State of Nevada and will obtain and preserve its qualification to do
business as a foreign corporation in each jurisdiction in which such
qualification is or shall be necessary to enable Servicer to perform its duties
under this Agreement.
SECTION 5.02. SERVICER'S AGREEMENT NOT TO TERMINATE.
(a) Except as provided in Section 5.02(b), in event of Company Default
and failure to cure that Default within 30 days of receipt of written
notification from Servicer, Servicer shall not resign from the duties and
obligations hereby imposed on it except upon the consent of the Company and
the Trustee.
(b) Servicer shall give written notice to the Company and the Trustee
within 30 days of an occurrence and continuance of an event for which
notice was given to the Company and the proper cure period expired, and now
constitutes an Event of Default of the Company. It is agreed by the parties
that the period of time for Servicer to discontinue performance of services
shall be 30 days, which shall begin to run at such time as notice is given
to the Company and Trustee.
SECTION 5.03. COVENANTS OF COMPANY: CORPORATE EXISTENCE. The Company shall
keep in full force and effect its existence and good standing as a corporation
under the laws of the State of Nevada and will obtain and preserve its
qualification to do business as a foreign entity in each jurisdiction in which
such qualification is or shall be necessary to enable the Company to perform its
duties under this Agreement.
SECTION 5.04. NO DEFAULT CERTIFICATION. Within thirty (30) days after each
twelve (12) month interval beginning with the date of this Agreement, the
Servicer will deliver to the Company or the Trustee, as the case may be, an
Officer's Certificate of Servicer certifying that (a) no Default or Event of
Default exists under this Agreement, or if such a Default or Event of Default
exists, the Officer's Certificate shall identify same and specify actions being
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taken to cure same; and (b) all representations and warranties made by Servicer
in Section 6.01 of this Agreement remain true and correct as of the date of such
Officer's Certificate or if such representation and warranties do not remain
true and correct, the Officer's Certificate shall identify which do not remain
true and correct, and shall specify actions being taken to cure same. In
accordance with the above referenced time interval, upon the Trustee's request,
the Company shall deliver to the Servicer or the Trustee, as the case may be, an
Officer's Certificate of the Company certifying both (a) and (b) above.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
SECTION 6.01. REPRESENTATIONS AND WARRANTIES OF SERVICER. Servicer hereby
represents, warrants and covenants to the Company and the Trustee that, as of
the date hereof:
(a) Servicer is a corporation duly organized, and validly existing and
in good standing under the laws of the State of Nevada with corporate power
and authority to conduct its business as currently conducted and as
contemplated by this Agreement:
(i) All necessary corporate action has been taken by Company to
authorize and empower Servicer and its officers or representatives,
acting on Servicer's behalf, to ensure Servicer has full power and
authority to execute, deliver and perform this Agreement.
(ii) The execution and delivery of this Agreement by Servicer and
its performance and compliance with the terms of this Agreement will
not violate Servicer's organization and regulatory documents or
constitute a default (or an event which, with notice or lapse of time,
or both, would constitute a default) under, or result in the breach
of, any material contract, indenture, loan, credit agreement or any
other agreement or instrument to which Servicer is a party or which
may be applicable to Servicer or any of its assets.
(iii) Servicer is not in violation of, and the execution and
delivery of this Agreement by Servicer and its performance and
compliance with the terms of this Agreement will not constitute a
violation with respect to, any order or decree of any court or any
order, regulation or demand of any federal, state, municipal or
governmental agency, which violation might have consequences that
would materially and adversely affect the condition (financial or
other) or options of Servicer or its properties or might have
consequences that would affect the performance or its properties or
might have consequences that would affect the performance of its
duties hereunder; provided, however, that Servicer is not representing
or warranting whether its performance and compliance with the terms of
this Agreement will constitute a violation under the Medicare or
Medicaid laws or other federal or state laws referenced in Section
6.02(g) below.
(iv) To the knowledge of Servicer, no proceeding of any kind,
including, but not limited to, litigation, arbitration or
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administrative, is pending or threatened against or contemplated by
Servicer which would have any material adverse effect on the
execution, delivery, performance or enforceability of this Agreement.
(v) No information, certificate of an officer, statement
furnished in writing or report delivered to the Company or the Trustee
by Servicer regarding this Agreement or the duties or obligations
contemplated by the Agreement has, to the knowledge of Servicer,
contained any untrue statement of a material fact or omitted a
material fact necessary to make the information, certificate,
statement or report not misleading.
(b) It is understood and agreed that the representations and
warranties set forth in this Section 6.01 shall inure to the benefit of the
Company and the Trustee.
SECTION 6.02. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
hereby represents, warrants and covenants to Servicer that, as of the date
hereof and as of the date of each delivery of a Purchased Account File for a
Healthcare Receivable and other types of Business Accounts Receivable to
Servicer:
(a) The Company is a corporation duly organized, and validly existing
and in good standing under the laws of the State of Delaware with power and
authority to conduct its business as currently conducted and is
contemplated by this Agreement.
(b) All necessary partnership, regulatory or other similar action has
been taken to authorize and empower the Company and the officer or
representatives acting on the Company's behalf, and the Company has full
power and authority to execute, deliver and perform this Agreement.
(c) The execution and delivery of this Agreement by the Company and
its performance and compliance with the terms of this Agreement will not
violate the Company's organization and regulatory documents or constitute a
default (or an event which, with notice of lapse of time, or both, would
constitute a default) under, or result in the breach of, any material
contract, indenture, loan credit agreement or any other agreement or
instrument to which the Company is a party or which may be applicable to
the Company or any of its assets.
(d) This Agreement constitutes a valid, legal and binding obligation
of the Company, enforceable against it in accordance with the terms
thereof, subject to applicable bankruptcy, insolvency, reorganization,
moratorium and other laws affecting the enforcement of creditor's rights
generally and to general principles or equity, regardless of whether such
enforcement is considered in a proceeding in equity or at law.
(e) The Company is not in violation of and the execution and delivery
of this Agreement by the Company and its performance and compliance with
the terms of this Agreement will not constitute a violation with respect
to, any law, order or decree of any court or any order, regulation or
demand of any federal, state, municipal or governmental agency, which
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violation might have consequences that would materially and adversely
affect the condition (financial or other) or operations of the Company or
its properties or might have consequences that would affect the performance
of its duties hereunder.
(f) To the knowledge of the Company, no proceeding of any kind,
including, but not limited to, litigation, arbitration, judicial or
administrative, is pending or threatened against or contemplated by the
Company which would under any circumstance have any material adverse effect
on the execution, delivery, performance or enforceability of this
Agreement.
(g) The Company's purchase of Healthcare Receivables representing
claims under the Medicare and Medicaid programs and any other programs
established by Governmental Entities, as contemplated by the respective
Purchase Agreements, will not violate any provisions of the Medicare Act
(42 U.S.C. Sections 1395-1396) or the Medicaid Program of the Social
Security Act (42 U.S.C. Sections 1396-1396p) or any other provisions of
federal or state law which provide for payment for healthcare services to
be made to the Clients of such services.
(h) No information, certificate of an officer, statement furnished in
writing or report delivered to Servicer by the Company, to the knowledge of
the Company, contains any untrue statement of a material fact or omits a
material fact necessary to make the information, certificate, statement or
report not misleading.
It is understood and agreed that the representations and warranties set
forth in this Section 6.02 shall inure to the benefit of the Servicer and the
Trustee.
ARTICLE VII
DEFAULT
SECTION 7.01. EVENTS OF DEFAULT--SERVICER. Any act or occurrence described
in this Section 7.01 shall constitute an Event of Default by Servicer under this
Agreement.
(a) Any failure to deposit in the Lockbox Account any payment required
to be so deposited by Servicer under the terms of this Agreement other than
a failure that does not continue for more than two Business Days after the
earlier of (i) discovery of such failure by an Officer of the Servicer or
(ii) delivery of written notice of such failure to Servicer by or on behalf
of the Company or the Trustee.
(b) Any failure on the part of Servicer duly to observe or perform in
any material respect any of the other covenants or agreements on the part
of Servicer to be performed under this Agreement, which failure continues
unremedied for a period of (i) five Business Days with respect to the
delivery of reports required by a Component Agreement; and (ii) with
respect to all other covenants or agreements, 30 calendar days after the
date on which written notice of such failure, requiring the same to be
remedied, shall have been given to Servicer by or on behalf of the Company
or the Trustee.
(c) The entry of a decree or order for relief by any court or agency
or supervisory authority having jurisdiction in respect of Servicer in an
involuntary case under any present or future federal or state bankruptcy,
insolvency or similar law, or appointing a receiver, liquidator, assignee,
trustee, custodian, conservator or other similar official in any
insolvency, readjustment of debt, marshalling of assets and liabilities or
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similar proceedings, ordering the winding up or liquidation of the affairs
of Servicer shall have been entered against Servicer and the continuance of
any such decree or order unstayed and in effect for a period of 60
consecutive days.
(d) Servicer shall consent to the appointment of a conservator or
receiver or liquidator in any bankruptcy, insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings of or relating
to Servicer or relating to all or substantially all of its property.
(e) Servicer shall (i) admit in writing its inability to pay its debts
generally as they become due; (ii) commence a voluntary case under the
federal bankruptcy laws, as now or hereafter in effect, or any present or
future federal or state bankruptcy, insolvency or similar law; (ii) consent
to the appointment of or taking possession by a receiver, liquidator,
assignee, trustee, custodian, sequestrator or other similar official of
Servicer or of a substantial part of its property; (iii) make an assignment
for the benefit of its creditors; (iv) fail generally to pay its debts as
such debts become due; or (v) take corporate action in furtherance of any
of the foregoing.
(f) Any material representation, warranty or statement of Servicer
made herein or in any certificate, report of other writing delivered
pursuant hereto shall prove to be incorrect in any material respect as of
the time when the same shall have been made and, within 30 calendar days
after written notice thereof shall have been given to Servicer by or on
behalf of the Company or the Trustee, the circumstance or condition in
respect of which such representation, warranty or statement was incorrect
shall not have been eliminated or otherwise cured and the adverse effects
thereof shall not have been cured.
SECTION 7.02. EVENTS OF DEFAULT--COMPANY. Any act or occurrence described
in this Section 7.02 shall constitute an Event of Default by Company under this
Agreement.
(a) Any failure by the Company to timely make any payment to Servicer
required to be made by the Company pursuant to this Agreement other than a
failure that does not continue for more than two Business Days after the
earlier of (i) discovery of such failure by an Officer of the Company or
(ii) delivery of written notice of such failure to the Company by or on
behalf of the Servicer shall constitute an Event of Default by the Company
under this Agreement. If any fees or expenses are not paid when due,
Company agrees to pay a late charge on the past due amount equal to the
lower of 1 1/2% of such amount per month, or the maximum rate allowed by
law.
(b) Failure of the Company to provide information or to use their
influence and authority to cause information required for Servicer's
processing to be furnished by the Company or Client within the time frame
stipulated in the Component Agreement.
(c) The entry of a decree or order for relief by any court or agency
or supervisory authority having jurisdiction in respect of the Company in
an involuntary case under any present or future federal or state
bankruptcy, insolvency or similar law, or appointing a receiver,
liquidator, assignee, trustee, custodian, conservator or other similar
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official in any insolvency, readjustment of debt, marshalling of assets and
liabilities or similar proceedings, ordering the winding up or liquidation
of the affairs of Servicer shall have been entered against the Company and
the continuance of any such decree or order unstayed and in effect for a
period of 60 consecutive days
(d) The Company shall consent to the appointment of a conservator,
receiver or liquidator in any bankruptcy, insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings of or relating
to the Company or relating to all or substantially all of its property.
(e) The Company shall (i) admit in writing its inability to pay its
debts generally as they become due; (ii) commence a voluntary case under
the federal bankruptcy laws, as now or hereafter in effect, or any present
or future federal or state bankruptcy, insolvency or similar law; (iii)
consent to the appointment of or taking possession by a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar
official of the Company or of a substantial part of its property; (iv) make
an assignment for the benefit of its creditors; (v) fail generally to pay
its debts as such debts become due; or (vi) take corporate action in
furtherance of any of the foregoing.
SECTION 7.03. REMEDIES FOR EVENT OF DEFAULT BY COMPANY. If an Event of
Default by the Company shall have occurred and be continuing under this
Agreement for a period of 30 days from the time of notice in writing, Servicer
shall be entitled to terminate this Agreement pursuant to notifications outlined
in Section 5.02, subject to Section 5.02(a), and cease all Servicing with
respect to Purchased Accounts in its possession, in which event it shall return
the Purchased Accounts to the Company and shall be entitled to retain all fees
previously paid by the Company to Servicer as per Section 5.02(b).
SECTION 7.04. REMEDIES FOR EVENT OF DEFAULT BY SERVICER. If an Event of
Default by the Servicer shall have occurred and be continuing under this
Agreement for a period of 30 days from the time of notice in writing, Company
shall be entitled to (a) appoint a successor Servicer, subject to the approval
of the Trustee; (b) enter the premises of the Servicer for any or all of the
following purposes: (i) assuming control of management of the servicing duties;
(ii) replacing date-entry and posting staff; (iii) redirection of mail to the
Client; or (iv) removal of all database containing equipment, computers and
servers; and (c) a right of offset of fees for any uncorrected servicing related
errors in an amount equal to the costs incurred correcting such errors.
ARTICLE VIII
INDEMNITY AND EXCULPATION
SECTION 8.01. INDEMNIFICATION OF COMPANY AND SERVICER.
(a) INDEMNIFICATION BY SERVICER. Servicer shall indemnify, defend and
hold harmless the Company, the Trustee and trust created under the Note
Issuance and Security Agreement, from and against any and all losses,
costs, expenses, damages and liabilities, including, without limitation,
reasonable attorney's fees and court costs, directly attributable to any
claim by any third party that Servicer committed any act involving
negligence, willful misconduct, or breach of this Agreement; provided that
as to third-party claims a court of competent jurisdiction has determined
that Servicer's actions involved negligence, willful misconduct or breach
12
of this Agreement (a "Servicer Adjudication"), and; provided, further, that
Servicer is given prompt written notice of such third-party claim after the
Company or the Trustee becomes aware of the same, reasonable assistance
from the Company and sole authority to defend or settle such claim subject
to Section 8.02. Servicer shall have no obligation under this Section if
such claim arises from Servicer's or a subcontractor's compliance with or
reliance upon the Company's, Trustee's or the Lockbox Account bank's data
specification or instructions, policies or procedures or if such
third-party claim is the direct result of the negligence of Trustee.
(b) INDEMNIFICATION BY COMPANY. Company shall indemnify, defend and
hold harmless the Servicer from and against any and all losses, costs,
expenses, damages and liabilities including, without limitation, reasonable
attorney's fees and court costs, directly attributable to any claim by any
third-party that Company committed any act involving negligence, willful
misconduct, or breach of this Agreement; provided that a court of competent
jurisdiction has determined that the Company's actions involved negligence,
willful misconduct or breach of this Agreement (a "Company Adjudication")
and, provided further, that Company is given prompt written notice of such
third-party claim after the Servicer or the Trustee becomes aware of the
same, reasonable assistance from the Servicer and sole authority to defend
or settle such claim subject to Section 8.03. Company shall have no
obligation under this Section if such claim arises from Company's or a
subcontractor's compliance with or reliance upon the Servicer's or the
Lockbox Account bank's data, specification or instructions, policies or
procedures.
SECTION 8.02. PROCEDURE FOR THIRD PARTY CLAIM INDEMNIFICATION. In the event
any third party asserts any claim: (a) against the Company with respect to any
matter to which the indemnification of Section 8.01(a) may eventually be
applicable; or (b) against Servicer with respect to any matters as to which the
indemnification of Section 8.01(b) may eventually be applicable, then the Person
seeking indemnification (the "Indemnified Party") shall give notice to the other
Person (the "Indemnifying Party") of such claim and the Indemnifying Party shall
have the right at its election to take over the defense or settlement of such
claim at its own expense by giving notice of such election in writing to the
Indemnified Party. If the Indemnifying Party does not give notice and does not
proceed to diligently defend such third-party claim within 30 days after notice
from the Indemnified Party, the Indemnifying Party shall have no further right
to defend such third-party claim or participate in the negotiation of any
settlement but shall reimburse the Indemnified Party for all losses, costs,
expenses, damages and liabilities, including without limitation, reasonable
attorney's fees and court costs related to the defense or settlement of such
third-party claim. The Indemnifying Party shall be entitled to participate in
and, upon notice to the Indemnified Party, assist in the defense of any such
action or claim in reasonable cooperation with, and with the reasonable
cooperation of, the Indemnified Party .The Indemnified Party will have the right
to employ its own counsel in any such action in addition to the counsel to the
Indemnifying Party, but the fees and expenses of such counsel will be at the
expense of such Indemnified Party, unless (i) the employment of counsel by the
Indemnified Party at its expense has been authorized in writing by the
Indemnifying Party; (ii) the Indemnifying Party has not in fact employed counsel
to assume the defense of such action within a reasonable time after receiving
notice of the commencement of the action; or (iii) the named parties to any such
action or proceeding (including any impleaded parties) include both the
13
Indemnifying Party and one or more Indemnified Parties, and the Indemnified
Parties shall have been advised by counsel that there may be one or more legal
defenses available to them which are different from or in addition to those
available to the Indemnifying Party (it being understood, however, that the
Indemnifying Party shall not, in connection with any one such action or
proceeding or separate but substantially similar or related actions or
proceedings in the same jurisdiction arising out of the same general allegations
or circumstances, be liable for the reasonable fees and expenses of more than
one separate firm of attorneys at any time for the Indemnified Party). The fees
and expenses of counsel, except for the Indemnified Party's separate counsel
retained under circumstances that are not set forth in (i), (ii) and (iii)
above, will be at the expense of the Indemnifying Party, and all such fees and
expenses will be reimbursed promptly as they are incurred. No settlement of any
such claim or action, including an admission of liability or the imposition of
duties of performance or payment of fines or other monetary amounts upon the
Indemnified Party or the Indemnifying Party shall be entered into without the
prior written consent of the Indemnified Party or, if the Indemnifying Party is
not controlling the proceedings, the Indemnifying Party. Any failure by an
Indemnified Party to comply with the provisions of this Section shall relieve
the Indemnifying Party of liability only if such failure is prejudicial to the
position of the Indemnifying Party and then only to the extent of such
prejudice.
SECTION 8.03. OTHER PROVISIONS LIMITING LIABILITY. In no event shall
Servicer or Company be liable to each other or to any third party for any lost
profits, lost business opportunities or any other consequential or incidental
damages arising out of or related to this Agreement or the Processing Services.
This limitation of liability shall apply even if Servicer or Company has been
advised of the possibility of such damages. Servicer shall not be liable for any
action taken or omitted by the Company or the Trustee. Servicer may rely in good
faith and shall be protected in acting upon (a) any document or information of
any kind respecting any matter arising hereunder believed by Servicer to be
genuine and correct and to have been signed or sent by the proper person and (b)
any instructions, consents, notices, or waivers given by the Company or the
Trustee. Notwithstanding Section 8.01(a) or 8.01(b), the indemnity obligation
owed to an Indemnified Party shall be reduced to the extent of an Indemnified
Party's comparative negligence as determined by a Servicer Adjudication or
Company Adjudication as the case may be.
ARTICLE IX
TERM AND TERMINATION OF AGREEMENT
SECTION 9.01. TERM AND TERMINATION OF AGREEMENT.
(a) The initial term of this Agreement shall commence upon the
Effective Date and expire at midnight on the first anniversary date
thereof, unless terminated pursuant to the terms hereof. Assuming the
parties elect not to terminate the agreement by giving written notice
thereof at least 90 days in advance of the initial anniversary date, then
the agreement shall automatically renew for an additional five-year period
from the initial anniversary date. Thereafter, the five-year term shall
renew automatically, and perpetually, in successive five-year terms unless
prior written notice is given to the non-terminating party at least 90 days
prior to the applicable expiration date.
14
(b) Absent an Event of Default of this Agreement, this Agreement shall
not be terminated solely as a result or an Event of Default under the
Indenture (unless such action or omission is also an Event of Default under
the terms of this Agreement) or any action taken by the Trustee thereafter
with respect thereto, and any liquidation or preservation of the Collateral
by the Trustee thereafter shall be subject to the rights of Servicer to
service the Receivables and to collect servicing compensation as provided
hereunder.
(c) All rights accrued and obligations incurred by any party prior to
termination of this Agreement shall continue to exist notwithstanding such
termination.
SECTION 9.02. TRANSFER OF SERVICING. In the event servicing performed
hereunder is terminated by Company, Servicer shall (a) pay over to the Trustee
or any other Person entitled thereto all other moneys with respect to the
Receivables held by Servicer less any amounts then due to Servicer under this
Agreement; (b) subject to Section 7.02, release the servicing and deliver all
the Purchased Account Files then in the possession of Servicer to the Company or
any other person or entity as designated by the Company and (c) perform all
steps required of the Servicer of accounts receivable to transfer such servicing
under applicable law, provided that all costs and expenses of such transfer
shall be paid by the Company.
SECTION 9.03. Without limitation to the foregoing, and to facilitate the
transfer of servicing to the successor Servicer, the Servicer shall, at the
Company's sole expense (except as provided in the provisions above), promptly
deliver to the Company, from time to time, upon request of the Company and
provided that at the time of such request all amounts owing Servicer pursuant to
this Agreement have been paid, a computer-generated magnetic test tape (the
"Tape") in a form acceptable to the Company and with programming adjustments
containing any information regarding the Receivables which the Company
reasonably requests in good faith. Upon transfer of servicing, the Company shall
certify to the Trustee that all Purchased Account Files are in the possession of
the successor Servicer. The Servicer and the Company shall cooperate with one
another to facilitate an orderly transfer of servicing.
SECTION 9.04. Following the transfer of servicing by Servicer, all amounts
relating to the Receivables collected by Servicer shall be received in trust for
the benefit of the Company and the Trustee and immediately forwarded to the
Trustee within two Business Days after the date of receipt of such amounts.
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.01. AMENDMENT. Except as provided herein under Section 10.07,
this Agreement may only be amended by the written agreement of the parties
hereto; provided that the Trustee shall have given its prior written consent to
such amendment. Servicer may amend the terms and conditions of Component
Agreements if necessary to conform to the requirements of applicable law or the
policies or requirements of payors by giving Company prior written notice
thereof.
15
SECTION 10.02. WAIVERS. The failure of either party at any time to require
performance by the other of any provision of this Agreement shall in no way
affect that party's right to enforce such provision, nor shall the waiver by
either party of any breach of any provision of this Agreement be taken or held
to be a waiver of any further breach of the same provision or any other
provision.
SECTION 10.03. NOTICES. All notices, requests, consents and other
communications hereunder shall be in writing and shall be sufficiently given and
shall be deemed given when delivered personally or mailed by first-class mail,
postage prepaid, or sent by telegram, telex or telecopy, or other similar
facsimile communication, or when given by telephone, confirmed in writing, sent
by any of the above methods on the same day, addressed as follows or to any
other address designated in writing by the applicable Party:
To Servicer: Medical Tracking Services, Inc.
0000 Xxxx Xxxx, Xxxxx 000
Xxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
To Company: Medical Capital Corporation
0000 Xxxx Xxxx, Xxxxx 000
Xxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
SECTION 10.04. SEVERABILITY OF PROVISION. If one or more of provisions of
this Agreement shall be for any reason whatever held invalid, such provisions
shall be deemed severable from the remaining covenants, agreements and
provisions of this Agreement and shall in no way affect the validity or
enforceability of such remaining provisions or the rights of any parties hereto.
To the extent permitted by law, the parties hereto waive any provision of law,
which renders any provision of this Agreement prohibited or unenforceable in any
respect.
SECTION 10.05. RIGHTS CUMULATIVE. Except as specifically set forth herein,
all rights and remedies from time to time conferred upon or reserved to the
Company, the Trustee, or Servicer or to any or all of the foregoing are
cumulative, and none is intended to be exclusive of another. No delay or
omission in insisting upon the strict observance of performance of any provision
of this Agreement, or in exercising any right or remedy shall be construed as a
waiver or relinquishment of such provision, nor shall it impair such right or
remedy. Except as specifically set forth herein, every right and remedy may be
exercised from time to time as often as deemed expedient.
SECTION 10.06. INSPECTION AND AUDIT RIGHTS.
(a) Servicer agrees that, upon prior written notice and to the extent
permitted under laws relating to the privacy rights of patients, will
permit the Company or independent certified public accountants selected by
the Company, during Servicer's normal business hours, to examine the
Purchased Account Files, all the books of account, records, reports and
other papers in the possession of Servicer relating to the Receivables
16
purchased by the Company and to make copies and extracts therefrom such as
to cause such books to be audited for the purpose of (i) confirming that
nothing has come to their attention that causes them to believe that the
servicing has not been conducted in substantial compliance with the terms
and conditions set forth in Exhibit B and (ii) reconciling on a test basis
the information contained in the weekly reports delivered by the Servicer
with information contained in the accounts, records and computer systems of
Servicer.
(b) Servicer shall, upon the prior written request of the Trustee,
permit the Trustee or its designated representatives to inspect the books
and records of Servicer as they may relate to the Receivables (other than
the books and records relating to the profits or losses of Servicer) to the
extent permitted under laws relating to the private rights of patients.
SECTION 10.07. MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF, THE OBLIGATION
OF SERVICER. Nothing in this Agreement shall prevent (a) any consolidation or
merger of Servicer with or into any other corporation, or any consolidation or
merger of any other corporation with or into Servicer; or (b) any assignment by
Servicer of its rights and obligations hereunder to any Affiliate or to any
corporation which is the surviving corporation of any such consolidation or
merger or which acquires all or substantially all of its assets. Servicer
covenants and agrees that the consolidation, merger or assignment shall be upon
the conditions that the due and timely performance and observance of all the
terms, covenants and conditions of this Agreement to be kept or performed by
Servicer shall, by an agreement supplemental hereto, executed and delivered to
the Trustee, be assumed by the Affiliate which is the assignee hereunder or by
the successor corporation (if other than Servicer) formed by or resulting from
any such consolidation or merger, or which shall have received the transfer of
all or substantially all of the property and assets of Servicer and to which the
assignee hereunder or successor corporation shall succeed to such rights and
obligations, just as fully and effectually as if such successor corporation had
been the original Servicer. Upon the effectiveness of such consolidation merger
or assignment, the assigning Servicer shall cease to be obligated hereunder.
SECTION 10.08. MUTUAL COVENANTS NOT TO COMPETE. Company is not in the
business of computerized servicing, tracking, billing, invoicing, or collecting
medical receivables for third parties, nor does Company have any intention of
doing so. Rather, Company is in the business of financing the acquisition or
factoring of Receivables. Also, Servicer is not in the business of acquiring or
factoring receivables, and has no intention of doing so. Rather, Servicer is in
the business of utilizing computer technology to service, track, xxxx, invoice,
and collect receivables. The intention of this Agreement is to create a
strategic alliance of the parties for the benefit of both parties, without fear
or threat of competition from each other's business activities. To the extent
permitted by applicable law, the parties agree not to compete with each other
during the terms, or extended terms, of this Agreement, as applied to the United
States of America. In the event this Agreement is terminated, this covenant not
to compete shall continue in full force and effect for a period of 18 months
after the date of termination.
SECTION 10.09. BINDING EFFECT. All provisions of this Agreement shall be
binding upon and inure to the benefit of the respective successors and assigns
of the parties hereto.
17
SECTION 10.10. CAPTIONS. The article, paragraph and other headings
contained in this Agreement are for reference purposes only and shall not limit
or otherwise affect the meaning hereof.
SECTION 10.11. LEGAL HOLIDAYS. In the case where the date on which any
action required to be taken, documents required to be delivered or payment
required to be made is not a Business Day, such action, delivery or payment need
not be made on such date, but may be made on the next succeeding Business Day.
SECTION 10.12. COUNTERPARTS. This Agreement may be executed simultaneously
in any number of counterparts, each of which counterparts shall be deemed to be
an original, and such counterparts shall constitute but one and the same
instrument.
SECTION 10.13. GOVERNING LAW. This Agreement shall be deemed entered into
with and shall be governed by and interpreted in accordance with the laws of the
State of Nevada. The rights and liabilities of the parties hereto shall be
determined in accordance with the laws of the State of Nevada except to the
extent that it is mandatory that the laws of some other jurisdiction apply.
SECTION 10.14. TRUSTEE A THIRD-PARTY BENEFICIARY. The parties recognize
that the Trustee (for the benefit of the Company's client, Medical Capital
Management, Inc.) is intended to be a third-party beneficiary of the
representations, warranties, covenants and agreements set forth in this
Agreement.
SECTION 10.15. MUTUAL COVENANTS REGARDING MARKETING EFFORTS. The parties
covenant that upon entering into this Agreement each will use its best efforts
to establish and implement a joint marketing effort whereby Servicer and Company
will each facilitate access to officers and other management and decision making
personnel of the other's clientele in order that each may make known its
respective servicing and financing capabilities.
18
IN WITNESS WHEREOF, Servicer and the Company have caused this Agreement to
be duly executed by their respective officers thereunto duly authorized as of
the day and year first above written.
MEDICAL CAPITAL CORPORATION
By______________________________________
Name____________________________________
Title___________________________________
MEDICAL TRACKING SERVICES, INC.
By______________________________________
Name____________________________________
Title___________________________________
Zions First National Bank, as Trustee, hereby acknowledges that the Company
has assigned its rights under this Agreement to the Trustee and the Trustee
accepts such assignment; provided however the Trustee shall not have any of the
obligations or liabilities hereunder by reason of such assignment or otherwise.
The Company shall remain solely liable for all obligations and liabilities of
the Company hereunder and under the Note Issuance and Security Agreement.
ZIONS FIRST NATIONAL BANK, as Trustee
By______________________________________
Name____________________________________
Title___________________________________
19
EXHIBIT A
PURCHASE AGREEMENT
A-1
EXHIBIT B
DUTIES OF THE SERVICER
DATABASE MAINTENANCE:
1. The Receivables database is to be maintained by the Servicer.
2. Servicer grants user and copy license to the Company for all proprietary
software used for the processing and maintenance of the Receivables.
3. Receive copies of all lockbox payments from the Client/Company's
corresponding Lockbox Account banks.
4. Copy and forward to Client all Lockbox Account receipts.
5. Post all payments and corresponding balance write-offs against individual
Receivables on a line-item basis.
6. Post all balance write-offs against Receivables on a line-item basis.
7. Reconcile all postings to cash deposits on a daily basis.
8. Interact with the Company's staff for all posting questions and errors.
9. Submit all reports and report corrections within the same business day (or
four hours into the subsequent business day)
RELATIONSHIP WITH COMPANY'S CLIENTS:
1. Intake of all Receivables in any of the following formats:
a. HCFA-1500 (and related versions)
b. UB-82/92 (and related versions)
c. Invoice (common format)
d. National Standard Format for Healthcare Claims
e. Spreadsheet or comma separated values
2. Servicer shall accept Receivables in various forms including:
a. Electronic mail
b. File acceptance
c. File printer form
d. Facsimile
e. Paper
3. Servicer must be able to re-assemble the Receivables into a form acceptable
to Company.
4. Servicer shall be able to identify and flag duplicate Receivables based
upon criteria set forth between Servicer and Company.
REPORTS:
The Servicer will utilize the terms, definitions and descriptions pursuant to
the Purchase Agreement and in accordance to the Company's requests which may be
adjusted from time to time. The reports are to be furnished to the Company as
described:
B-2
PROVIDER SUMMARY REPORT- AS REQUESTED BY COMPANY
The Client summary report is a management report that may be ordered by
relationship, provider or corporation. This report provides the relationship's,
provider's or corporation's activity for a given time period. The report
includes outstanding, net owed, reserve, collections, disbursements and fees.
The report is time dependent therefore, it cannot be ordered for back dated
reports.
COLLECTION REPORT-MONTHLY OR AS REQUESTED BY COMPANY
The collection report is a summary report that can be printed daily to report
and be used to verify posted transactions. The report is ordered by provider or
by corporation. The collection report provides a detailed list of
transactions/payments that have a post date within the period requested. This
report provides a detailed line for each payment that includes post date, claim
number, batch number of the claim, payor, check number, Estimated Net Receivable
amount and the transaction/payment amount. The collection report should be kept
with the settlement reports. The daily collection report used to verify posted
payments should be kept with the payment control folder.
PURCHASE REPORT/CLAIM APPRAISAL REPORT PART OF EACH PURCHASE TRANSACTION ON A
PRE-DETERMINED FREQUENCY AS SET FORTH BY EACH PROVIDER DESCRIPTION
The purchase report is a final report that can be requested by each individual
provider after all edits are completed. The report can only be requested after
the merge process. This report provides data on claims that were imported,
appraised and considered for purchase during the settlement period. The report
groups claims into the categories of purchased, rejected or pending. Claims that
are rejected or pending will be identified with and error code for reference.
The purchases report should be filed with the settlement reports in the claims
control file. The appraisal process calculates and assigns an Estimated Net
Receivable amount to a claim. The Estimated Net Receivable is calculated based
on the reimbursement rates established on the account.
PURCHASE-PENDING-REJECTION REPORT PART OF EACH PURCHASE TRANSACTION ON A
PRE-DETERMINED FREQUENCY AS SET FORTH BY EACH PROVIDER DESCRIPTION
The purchase-pending-rejection report shows what claims were purchased and
rejected.
SETTLEMENT STATEMENT PART OF EACH PURCHASE TRANSACTION ON A PRE-DETERMINED
FREQUENCY AS SET FORTH BY EACH PROVIDER DESCRIPTION
The settlement statement is a summary report that is issued by provider and by
corporation on the date of purchase. The settlement statement includes a summary
of the advanced amount for the batch during the current period. The statement
contains a summary of the activity that occurred during the settlement period
collectively arriving at the net due provider for settlement. The period's
summarized activity includes collections, previous reserve disbursements and
open and the balance. The advance for the current batch should be verified to
the purchase report. The amount due the provider for the period should be
B-3
verified to the reserve account report. The settlement statement should be kept
with the purchase reports filed in the claims control file.
AGED REPORT BY PAYOR - WEEKLY
The aged report by payor provides a summary for a client aging the claims by
payor.
BATCH REPORT WITH AGING-WEEKLY
The batch report with aging contains a summary for a client aging the claims by
batches.
OUTSTANDING CLAIMS REPORT-MONTHLY
The outstanding claims report is a summary of all outstanding claims by batches.
This reports is the outstanding accounts receivable balance. There is an
identifiable outstanding gross receivable and outstanding net receivable.
B-4
