Document:

exv10w4

 

EXHIBIT 10.4

CONSULTING AGREEMENT

BETWEEN

INTEGRATED FINANCIAL SYSTEMS, INC. “COMPANY”

AND

OPTIMAX LLC “CONSULTANT”

EFFECTIVE: AUGUST 1, 2002

 

 

CONSULTANT AGREEMENT – OPTIMAX LLC

TABLE OF CONTENTS

	 	 	 	 	 
	1. CONSULTANT
	 	 	1	 
	2. DUTIES
	 	 	1	 
	3. TERM
	 	 	1	 
	4. COMPENSATION
	 	 	1	 
	a. Consulting Fee
	 	 	1	 
	b. Bonus
	 	 	1	 
	5. STOCK OPTIONS
	 	 	1	 
	a. Grant of Stock Options
	 	 	1	 
	6. BENEFITS
	 	 	2	 
	a. General
	 	 	2	 
	b. Health Insurance
	 	 	2	 
	7. EXPENSES
	 	 	2	 
	8. TERMINATION BY CONSULTANT
	 	 	2	 
	9. TERMINATION WITH CAUSE BY COMPANY
	 	 	2	 
	10. TERMINATION WITHOUT CAUSE BY COMPANY
	 	 	3	 
	11. WORK DEVELOPMENTS
	 	 	3	 
	12. LIMITED COVENANT NOT TO COMPETE OR INTERFERE
	 	 	3	 
	13. TRADE SECRETS AND CONFIDENTIAL INFORMATION
	 	 	4	 
	14. RETURN OF INFORMATION
	 	 	4	 
	15. REMEDIES
	 	 	4	 
	16. PRIOR AGREEMENTS
	 	 	5	 
	17. OTHER BUSINESS ACTIVITIES
	 	 	5	 
	a. Non - Competitive Businesses
	 	 	5	 
	18. ARBITRATION
	 	 	5	 
	a. First Action
	 	 	5	 
	b. Second Action
	 	 	5	 

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	c. Third Action
	 	 	5	 
	d. Cost
	 	 	6	 
	19. MISCELLANEOUS
	 	 	6	 
	a. Waiver
	 	 	6	 
	b. Controlling Law
	 	 	6	 
	c. Notices
	 	 	6	 
	d. Binding Nature of Agreement
	 	 	6	 
	e. Survival
	 	 	6	 
	f. Execution in Counterparts
	 	 	6	 
	g. Provisions Separable
	 	 	7	 
	h. Entire Agreement
	 	 	7	 
	i. Amendment
	 	 	7	 
	k. Gender, Etc
	 	 	7	 
	I. Number of Days
	 	 	7	 
	20. EXECUTION AND DELIVERY
	 	 	8	 

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CONSULTING AGREEMENT

THIS AGREEMENT is dated as of August 1, 2002, and is entered into by and
between Integrated Financial Systems, Inc., a Colorado corporation (“Company”)
and Optimax LLC, (“Consultant”).

     Company desires to avail itself of the general, financial, and management
expertise possessed by Consultant for the purpose of establishing its
healthcare financial services business. Consultant desires to provide such
expertise to Company. Company has determined that it is in its best interest to
engage Consultant, and Consultant desires to be engaged by Company. All of the
terms and conditions are contained in this Agreement.

In consideration of the mutual promises and covenants herein contained and
intending to be legally bound, Company and Consultant agree as follows:

1. Consultant.

Company hereby engages Consultant and Consultant hereby accepts the engagement
by Company for the period and upon the terms and conditions contained in this
Agreement.

2. Duties.

     The Consultant is hereby engaged as a Financial and Management Consultant.
Consultant shall exert its best effort to the Company and shall carefully and
accurately perform all the duties and tasks as may, from time to time, be
assigned by the Company’s Chief Executive Officer and by the Company’s Board of
Directors.

3. Term.

     This Agreement shall be for a term commencing on August 1, 2002 and ending
on July 31, 2005, unless ended sooner under Sections 8, 9 or 10 of this
Agreement. Unless Consultant is notified otherwise in writing at least thirty
(30) days preceding the end of each term, the term of this agreement will be
automatically renewed for one year.

4. Compensation.

a. Consulting Fee.

     Company shall pay to Consultant an annual consulting fee of One Hundred
Thirty-eight Thousand Dollars ($138,000) each year during the term of this
Agreement. The annual consulting fee is payable in reasonable periodic
installments, not less frequent than monthly. By action of the Board of
Directors, the annual consulting fee will be reviewed annually and, as
appropriate, may be increased.

b. Bonus.

     In addition to Consultant’s annual consulting fee, Company will pay to
Consultant such bonuses, if any, up to 100% of the consultant’s annual
consulting fee and incentive stock options, in each case as the Board of
Directors shall, from time to time, approve.

5. Stock Options.

a. Grant of Stock Options.

     As additional consideration for Consultant’s services to be rendered
hereunder, Company hereby grants to Consultant 50,000 Non Qualified Stock
Options under the Integrated Financial Systems Inc. 2002 Stock Option Plan. The
Consultant’s Stock Options shall be granted on the effective date of this
agreement and vest in equal quarterly increments over three years at an
exercise price of $0.05 per share

 

 

with an exercise period of 10 years. Upon a Change in Control as defined
in the 2002 Stock Option Plan, all of Consultant’s Options shall vest
immediately.

b. Related Conditions

     The Consultant’s Options shall not confer upon Consultant any right under
this Agreement not contained elsewhere herein with respect to continued
consulting to Company nor shall it interfere in any way with the right of
Company to terminate Consultant pursuant to the terms and conditions of this
Agreement elsewhere contained herein; nor shall the Consultant’s Options be
construed in derogation of any other right(s) of Company under this Agreement
elsewhere contained herein.

6. Benefits.

a. General.

     During the term of this Agreement, Consultant shall be entitled to receive
all benefits and to participate in all plans or programs on the same basis as
they are made available by Company to any of its officers and senior management
employees of Company including, but not limited to, stock option plans and
rights to participate in registration of securities.

b. Health Insurance.

     Company shall allow one key employee or manager of Consultant, at
Company’s expense, to enroll in the Company’s health plan, if any, that is
adopted by Company.

7. Expenses.

     Company shall pay or reimburse Consultant for any out-of-pocket business
expenses reasonably incurred by it in the performance of Consultant’s duties,
subject to such policies and procedures regarding expense reimbursement as may
be adopted from time to time by Company.

8. Termination by Consultant.

     Consultant may terminate this Agreement at any time, without cause, on
thirty (30) days’ written notice. If Consultant terminates this agreement
during the term of this Agreement, this Agreement shall end without any further
obligation by Company except to pay Consultant:

	a)	 	such portion of Consultant’s annual consulting fee provided
for in Section 4. a. hereof, as may be accrued and unpaid at the
date of its termination; and
	 
	b)	 	any unpaid bonuses, if any, pursuant to Section 4. b. hereof,
as the case may be, in respect of the period before the date of
termination; and
	 
	c)	 	any un-reimbursed business expenses payable to Consultant
pursuant to Section 6 hereof.

9. Termination With Cause by Company.

     Company may terminate this Agreement and discharge Consultant at any time
because of the violation by Consultant of any of the provisions of this
Agreement or for Consultant’s neglect of duty, gross negligence, incompetence,
dishonesty, criminal indictment or conviction of a felony crime, conviction of
a misdemeanor involving moral turpitude, or misconduct or willful inattention,
determined in good faith by its Board of Directors to be materially harmful to
the business of Company. In such event, Company shall have no obligations to
Consultant other than to pay Consultant such portion of Consultant’s annual
consulting fee provided for in Section 4. a. hereof, as may be accrued and
unpaid at the date of termination with cause.

     Before terminating this Agreement and discharging Consultant for any
cause, Company shall take the actions in Section 18 a. through c. herein.

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10. Termination Without Cause by Company.

     Company may terminate this Agreement and discharge Consultant at any time
without cause on thirty (30) days’ written notice. If Company terminates
Consultant without cause, Company shall continue, during the lesser of the
remaining term of this Agreement or one year from the date of termination
without cause, to pay Consultant all amounts that would have been due to
Consultant pursuant to Sections 4 and 6 hereof as if this Agreement were in
full force and effect and Consultant’s unvested Stock Options shall immediately
vest. Company expressly agrees that Consultant shall have no duty to accept
alternative consultant or otherwise mitigate damages.

11. Work Developments.

     For purposes of this Agreement, “Work Developments” consist of all
technological, financial, operating, and training ideas, processes and
materials, specifically including all inventions, discoveries, improvements,
enhancements, computer programs, written materials and developments relating to
the existing or contemplated business or interests of Company that Consultant
may develop or conceive during the term of his consulting hereunder, alone or
with others, during or after working hours, with or without the use of the
resources of Company. All Work Developments relating to the existing or
contemplated business or interests of Company and prepared within the scope of
Consultant’s agreement shall be considered “Work for Hire” as that phrase is
defined in the Copyright Act of 1976, as amended. Consultant shall communicate
to Company promptly and fully all Work Developments, and make available to
Company any drawings, work papers, models, diskettes, computer tapes, or other
tangible incidents of such Work Developments.

     All Work Developments shall be and remain the sole and exclusive property
of Company or its designee. All copyrightable material generated or developed
under this Agreement shall be considered works made for hire under U.S.
copyright law and all such materials shall, upon creation, be owned exclusively
by Company. To the extent that any such material, under applicable law, may not
be considered works made for hire, Consultant hereby assigns to Company the
ownership of copyright in such materials, without the necessity of further
consideration, and Company shall be entitled to register and hold in its own
name all copyrights in respect of such materials. Consultant shall assign to
Company in full any right Consultant may acquire now or in the future with
respect to any such Work Developments. Any Work Development for which the date
of making or conception shall not otherwise have been established and which is
described in a copyright registered, or a patent application filed, or which is
disclosed to a third party, by Consultant, within one year following the
termination of such consultant shall be deemed to fall within this Provision.

12. Limited Covenant Not to Compete or Interfere.

     Company expects to invest considerable time, effort, and capital in
enhancing the value and desirability of its products and services and in
working with consultant. Both this investment and Consultant’s compensation
reflect Company’s expectation of receiving considerable return from the use of
Consultant’s services and know-how in the future, free from any danger that
Company’s competitors may attempt to induce Consultant to terminate this
agreement with the Company and wrongfully gain the benefit of the Company’s
investment in Consultant. The partial restraint set forth herein does not, and
cannot, provide complete protection for Company’s investment, development
efforts, product strategy, and propriety information, but Company believes that
in combination with the other provisions of this Agreement, it is the most fair
and reasonable measure permitted under applicable law to protect Company’s
interests, giving due regard to both Consultant’s and Company’s interests.
Consultant recognizes that a substantial part of the value of a company such as
Company’s resides in the goodwill with its customers and that the value of
Company’s business will be significantly diminished if Consultant attempts to
compete with Company or interfere with Company’s activities or solicit its
clients. Therefore, during the term of this Agreement and for one (1) year
after ending his consultant with Company for any reason, other than termination
by Company without cause as set forth in Section 12 Termination Without Cause,
Consultant shall not, within the United States, associate in any capacity
whatsoever, whether as a promoter, owner, officer, director, consultant,
partner, lessee, lessor, licensee, licensor, lender, agent, consultant, broker,
commission salesman or otherwise, in any business competitive, directly or
indirectly, with the business of Company; and Consultant will not attempt to
solicit, employ, retain as a consultant, interfere with, entice away or

persuade, directly or indirectly, any consultant( or any individual who has

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agreed to be engaged or retained as a consultant by company within one
year of such prohibited acts of the Company to terminate its relationship with
the Company, or to do any act that may result in the impairment of the
relationship between the Company and its consultants. However, nothing
contained in this Section 16 shall prevent Consultant from holding for
investment no more than five percent (5%) of any class of equity securities of
a company whose securities are traded on a national securities exchange or on
the over the counter market.

     Prior to engaging in any business during the period of non-competition
provided for above, Consultant shall notify Company of its intent to do so in
order that the Company may determine whether such business is a competing
business. Consultant, shall supply, upon request of Company, any information
reasonably requested by Company for such determination. For purpose of this
Agreement, the term “Client” shall mean any person, corporation, partnership or
any other entity of any nature whatsoever, with whom Company has had written or
oral communications.

13. Trade Secrets and Confidential Information.

     Consultant shall not, except as Company may otherwise consent in writing
or as may be required by applicable law, disclose at any time (except as
Consultant’s duties for Company may require) or use directly or indirectly for
Consultant or others, either during or subsequent to Consultant’s engagement,
any secret or confidential information, knowledge, or data of Company or any of
Company’s affiliate’s business or clients, which Consultant may receive during
the course of Consultant’s engagement, relating to client lists, data, records,
computer programs, manuals, formulas, processes, methods, machines,
manufactures, compositions, inventions, discoveries or other matters that are
of secret or confidential nature. All records and equipment and other materials
relating in any way to confidential information connected to clients or to
Company’s business shall be and remain Company’s sole property during and after
the Term of Consultant.

14. Return of Information.

     Consultant shall deliver promptly to Company on termination of
Consultant’s engagement, or at any time Company may so request, all records
which are in Consultant’s possession or under Consultant’s control, and which
pertain to the Work Developments or to the secret or confidential information,
knowledge, or data of Company described in Section 15 above. “Record” or
“records” is used herein to include without limitation the original or any copy
(regardless of origin or location) of any statements, papers, writings,
letters, memoranda, reports, log books, notes, articles, journals, journal
articles, magazines, newsletters, blueprints, drawings, sketches, books,
pamphlets, records, recordings, pictures, negatives, mechanical or electronic
recordings, price lists, advertisements, guarantees, contracts, other
agreements, memoranda of understanding, promissory notes, negotiable
instruments, diaries, charts, graphs, notices and any form of collated data for
use with electronic data processing equipment or any other object containing a
written, printed, spoken or photographic image or sound. “Record” or “records”
also includes cards, magnetic tapes, magnetic or laser disks or other
electronic information storage devices for use in a computer or which can be
extricated or assembled with the use of a computer or computer accessories.
Upon termination of consultant, Consultant agrees to represent to Company that
he has complied with the provisions of this Section 16.

15. Remedies.

     Consultant agrees and acknowledges that a breach on the part of Consultant
of the covenants contained in Sections 11,12,13 or 14 hereto (hereinafter
“Section 15 Breach”) will cause irreparable damage to the Company, and that it
is and will be impossible to estimate or determine the damage that will be
suffered by the Company in the event of a breach by Consultant of such covenant
and that Company would not have an adequate remedy at law. Consultant,
therefore, further agrees that if:

	 	 	(a.) the Company notifies Consultant of a Section 15 Breach; and
	 
	 	 	(b.) Consultant fails to cure the Section 15 Breach within 24 hours of such notice; and
	 
	 	 	(c.) the Company submits the matter to arbitration pursuant to Section 18 hereof; and

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	 	 	(d.) the matter is not resolved to the satisfaction of both
parties within fifteen (15) days of such submission.

then, the Company shall be entitled as a matter of course to specific
performance and/or temporary and permanent injunctive relief from any court of
competent equity jurisdiction restraining any further Section 15 Breach by
Consultant, its company, consultants, partners, agents or other associates, or
any of them, without the necessity of proving actual damage to the Company by
reason of any such breach.

     If any particular provisions of this Agreement shall be adjudicated to be
invalid or unenforceable, they shall be deemed to be amended to delete
therefrom such provision or portion adjudicated to be invalid or unenforceable,
such amendment to apply only with respect to operation of this Agreement in the
particular jurisdiction in which such adjudication is made. Nothing herein
shall be construed as limiting, or prohibiting Company from pursing any other
remedies for such breach or threatened breach. The prevailing party in any suit
under this Section 15, will reimburse the other party for its expenses incurred
in connection with such a suit, including attorneys’ fees.

16. Prior Agreements.

     Consultant represents to Company that there are no restrictions,
agreements or understandings to which Consultant is a party that would prevent
or make unlawful its execution of this Agreement or his consulting hereunder.

17. Other Business Activities.

a. Non - Competitive Businesses.

     Except as provided in Section 3 hereof, throughout the term of this
Agreement, Consultant shall exert its best efforts to the Company to the
performance of its duties hereunder in a way that will faithfully and
diligently further the business and interests of Company.

18. Arbitration.

     The procedure for resolving disputes between Consultant and Company shall
be as modified by Section 15 hereof, and shall involve the following steps:

a. First Action.

     In case one party (the “First Party”) comes to believe that another party
(the “Second Party”) is performing improperly, or failing to perform, the
Second Party’s obligations under this Agreement, the First Party shall go to
the Second Party alone and tell such party their concern and both parties shall
attempt mutually to resolve the dispute.

b. Second Action.

     If the first action does not resolve the dispute, then the First Party
shall represent its concerns to the Second Party in a meeting in front of one
or more witnesses who shall maintain a record of the proceedings of such
meeting.

c. Third Action.

     If under the second action the dispute is unresolved, then the dispute
shall be submitted for arbitration to a panel of three arbitrators, one of whom
shall be selected by the First Party, one of whom shall be selected by the
Second Party and one of whom shall be selected by the first two arbitrators.
The arbitration shall be conducted in accordance with the rules of the American
Arbitration Association. The panel’s ruling shall be final, unappealable and
binding upon both parties and may be entered by either party as a final award
in any court having jurisdiction.

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d. Cost.

     Allocation of the cost of arbitration between parties to the arbitration
shall be determined by the arbitrators in accordance with the Rules of the
American Arbitration Association.

19. Miscellaneous.

a. Waiver.

     Neither the failure nor any delay by either party to exercise any right,
remedy, power or privilege under this Agreement shall operate as a waiver of
it, nor shall any single or partial exercise of any right, remedy, power or
privilege preclude any other or further exercise of the same or of any other
right, remedy, power or privilege, nor shall waiver of any right, remedy, power
or privilege with respect to any occurrence be construed as a waiver of right,
remedy, power or privilege with respect to any other occurrence.

b. Controlling Law.

     This Agreement shall be governed by and construed according to the laws of
the State of Colorado.

c. Notices.

     All notices, requests, demands, and other communication, required or
permitted under this Agreement and the transactions contemplated herein shall
be in writing. They shall be deemed to have been duly given, made and received
when delivered against receipt or when sent by United States registered mail,
return receipt requested, postage prepaid, addressed as set forth below: 1) If
to Consultant:

	 	 	Optimax LLC

7315 East Orchard Road

Suite 300

Greenwood Village, Colorado 80111

     2) If to Company:

	 	 	Integrated Financial Services, Inc.

7315 East Orchard Road, Suite 300

Greenwood Village, Colorado 80111

d. Binding Nature of Agreement.

     This Agreement shall be binding upon and inure to the benefit of Company,
its successors and assigns and upon Consultant, its successors and assigns, but
shall not be assignable by the Consultant.

e. Survival.

     The obligations of Sections 11,12,13 and 14 shall survive the termination
of Consultant’s engagement for any reason.

f. Execution in Counterparts.

     This Agreement may be executed in any number of counterparts, each shall
be deemed to be an original against any party whose signature appears thereon,
and all together are the same instrument.

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g. Provisions Separable.

     The provisions of this Agreement are independent of and separable from
each other. No provision shall be affected or rendered invalid or unenforceable
because for any reason any other of them may be invalid or unenforceable in
whole or in part.

h. Entire Agreement.

     This Agreement contains the entire understanding among the parties hereto
with respect to its subject matter. It supersedes all prior and contemporaneous
agreements and understandings, inducements or conditions, express or implied,
oral or written, except as herein contained. The express terms hereof control
and supersede any courses of performance or use of the trade inconsistent with
any of the terms.

i. Amendment.

     This Agreement may not be modified or amended other than by a written
agreement executed by both parties.

j. Paragraph Headings.

     The paragraph headings in this Agreement are for convenience only. They
form no part of this Agreement and shall not affect its interpretation.

k. Gender, Etc.

     Words used herein, despite the number and gender specifically used, shall
be deemed and construed to include any other number, singular or plural, and
any other gender, masculine, feminine or neuter, as the context requires.

I. Number of Days.

     In computing the number of days for purposes of this Agreement, all days
shall be counted, including Saturdays, Sundays and holidays; provided, however,
if the final day of any period falls on a Saturday, Sunday or holiday, then the
final day shall be deemed to be the next day that is not a Saturday, Sunday or
holiday.

SIGNATURE BLOCK ON NEXT PAGE

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20. Execution and Delivery.

     IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
and delivered on the date first above written:

[CORPORATE SEAL]

	 	 	 	 	 
	

	 	Integrated Financial Systems, Inc.
	 
	 	 	 	 
	

	 	by:	 	/s/ John C. Herbers
	

	 	 	 	
 
	

	 	 	 	       Director
	 
	 	 	 	 
	

	 	by:	 	/s/ Steven C. Robbins
	

	 	 	 	
 
	

	 	 	 	       Director
	 
	 	 	 	 
	

	 	 	 	       Consultant:
	 
	 	 	 	 
	

	 	by:	 	/s/  Steven C. Robbins
	

	 	 	 	
 
	

	 	 	 	       Manager

8exv10w5

 

EXHIBIT 10.5

FLEXIBLE PAY SYSTEM AGREEMENT

                                                /INTEGRATED FINANCIAL SYSTEMS, INC.

THIS AGREEMENT is entered into as of the       day of                                                  ,
by and
between Integrated Financial Systems, Inc., a Colorado corporation (“IFS”) and
                                                 (the “Hospital”).

RECITALS:

A.      IFS has developed and operates a proprietary, automated system that (i)
provides hospitals with account management tools for patient responsibility
hospital charges and (ii) provides extended payment plans for the patients and
other obligors who incur such charges (the “Flexible Pay” system or the
“Program”).

B.      Hospital desires to contract with IFS to implement the Flexible Pay
system subject to the terms and conditions hereof.

NOW, THEREFORE, the parties hereto agree as follows:

ARTICLE I

DEFINITIONS

The defined terms herein shall have the meanings set forth below and in
the Financial Addendum attached as Exhibit A hereto.

(1)      “Account” shall mean the amount a Responsible Party owes Hospital
arising from the sale or provision of goods and services provided by Hospital
and which is (i) not covered by a third party payer, (ii) is incurred pursuant
to a Revolving Credit Agreement, (iii) is evidenced by a Hospital Bill, and
(iv) satisfies the Account Criteria.

(2)      “Account Criteria” shall mean the criteria set forth on Exhibit B
hereto.

(3)      “Additional Advance Amount” shall mean, with respect to any Account,
any principal payment received by IFS in excess of the Advance Amount.

(4)      “Advance Amount” shall mean, with respect to each Account, the face
amount of such Account multiplied by the Advance Rate.

(5)      “Advance Rate” shall be the amount set forth in Exhibit A hereto.

(6)      “Default Account” shall mean any Account where the equivalent of three
(3) or more scheduled payments of principal and/or interest are delinquent
(whether or not such scheduled payments are consecutive).

(7)      “Delinquent Account” shall mean any Account where one or more
scheduled payments of principal and/or interest have not been received by the
tenth (10th) day after the due date thereof and such payments remain
outstanding.

(8)      “Disputed Account” shall mean an Account:

 

 

	 	(a)	 	as to which any Responsible Party has sought protection under the
federal Bankruptcy Code or any similar state law;

	 
	 	(b)	 	owed by any Responsible Party who is deceased;

	 
	 	(c)	 	that has been recalled by Hospital;

	 
	 	(d)	 	as to which any Responsible Party has
threatened or initiated legal action against IFS or
Hospital;

	 
	 	(e)	 	wherein, after reasonable effort, any
Responsible Party cannot be located;

	 
	 	(f)	 	wherein fraud is reasonably suspected;

	 
	 	(g)	 	that IFS determines to be
uncollectible;

	 
	 	(h)	 	that is determined to qualify for
charity or indigent care;

	 
	 	(i)	 	as to which the Responsible Party
disputes the nature, quality, quantity, use or fitness of
the services rendered and/or goods sold by Hospital, or
alleges that Hospital has breached the terms of the
contract of service or sale, or disputes that the
contract of service or sale was entered into by the
Responsible Party;

	 
	 	(j)	 	not submitted by Hospital for
Settlement; and

	 
	 	(k)	 	arising from use of an IFS issued
Hospital Revolving Credit Card that is not a Valid
Hospital Revolving Credit Card.

(9)      “Financial Institution” shall mean one or more persons or entities
that provide financing to IFS to fund its obligations hereunder. IFS shall
notify Hospital pursuant to Exhibit G hereto of any assignment of this
Agreement to a Financial Institution.

(10)      “Financing Request” shall mean the form attached hereto as Exhibit
C.

(11)      “Hospital Bill” shall mean the invoice or other evidence of the
transaction between Hospital and the Responsible Party, which is to be financed
by IFS pursuant to the Revolving Credit Agreement with such Responsible Party.

(12)      “Net Proceeds” shall mean the Advance Amount minus the Transaction
Fee, Service Fee and Software Fee.

(13)      “Purchase Account” shall mean an Account that is subject to purchase
by Hospital pursuant to Article IV hereof.

(14)      “Purchase Event” shall occur with respect to any Account when such
Account becomes:

	 	(a)	 	a Default Account; or

	 
	 	(b)	 	a Disputed Account.

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(15)      “Purchase Interest Amount” shall mean, with respect to a Purchase
Account, an amount equal to interest on the unpaid principal amount of such
account at the Purchase Interest Rate from the time such account becomes a
Delinquent Account to the purchase of such Account by Hospital.

(16)      “Purchase Interest Rate” shall mean the per annum rate of interest
set forth in Exhibit A hereto, which is the interest rate payable by Hospital
with respect to any Purchase Account.

(17)      “Purchase Notice” shall mean the form attached hereto as Exhibit D.

(18)      “Purchase Price” shall mean, with respect to any Account, the Advance
Amount minus any principal payments received in respect of such Account, plus
the Purchase Interest Amount, minus the amount of any Service Fee refund
available under subsection (4) of Article IV.

(19)      “Responsible Party” shall mean the person or entity (who may or may
not be the patient) that (i) is the obligor with respect to an Account, (ii)
has executed a Revolving Credit Agreement and (iii) has executed a Hospital
Bill evidencing the amount owed to Hospital with respect to such Account.

(20)      “Revolving Credit Agreement” shall mean the documentation utilized by
IFS for origination of Accounts. All such documentation shall be in a form
prepared by IFS.

(21)      “Service Fee” shall mean the amount set forth in Exhibit A hereto,
which is the amount charged by IFS to Hospital for the Servicing Procedures
performed on an Account by IFS.

(22)      “Servicing Procedures” shall mean the procedures identified on
Exhibit E hereto.

(23)      “Settlement Date” shall mean the second and fourth Fridays of each
month while this Agreement is in effect, unless such day is a holiday or day
upon which banks are not required to be open in Denver, Colorado, in which
event the Settlement Date shall be the next day on which banks are required to
be open.

(24)      “Software Fees” shall mean the amount set forth in Exhibit A hereto,
which is the amount charged by IFS to the hospital for the monthly use of the
FlexPay system hosted by IFS. Such fee shall be fully earned and non-refundable
upon payment.

(25)      “Termination Event” shall mean:

	 	(a)	 	termination by either party under Article IX hereof;

	 
	 	(b)	 	termination by either party under Article X by
reason of a default by the other party after expiration of the
notice and grace periods provided therein.

(26)      “Termination Notice” shall mean the form attached hereto as Exhibit
F.

(27)      “Transaction Fee” shall mean the amount set forth in Exhibit A
hereto, which is the amount charged by IFS to Hospital concurrently with the
establishing of an Account by IFS. Such fee shall be fully earned and
non-refundable upon payment.

(28)      “Valid Hospital Revolving Credit Card” shall mean a revolving credit
card issued by IFS to the Responsible Party which has not expired and as to
which Hospital has not received written notice that it is invalid or otherwise
unusable.

3

 

ARTICLE II

USE OF FLEXIBLE PAY SYSTEM

During the term of this Agreement and subject to the terms hereof, IFS
agrees to allow the Hospital to use on a monthly basis the Flexible Pay
system hosted by IFS. The Hospital agrees to pay IFS a monthly Software Fee for
the monthly use of the Flexible Pay system equal to the amount specified in
Exhibit A. Such fee shall be fully earned and non-refundable upon payment.

ARTICLE III

SETTLEMENT OF ACCOUNTS

(1)      Commitment. Subject to the terms hereof, IFS agrees to make the
Flexible Pay system available to Hospital on a monthly basis and to enable
its patients to pay for goods and services provided by Hospital, which shall
conform to the Account Criteria.

(2)      Processing Procedure. On the Friday prior to the next applicable
Settlement Date, Hospital shall submit a Financing Request Form attached hereto
as Exhibit C. The Form shall include a listing of all Accounts evidenced by
Hospital Bills executed and delivered by Responsible Parties which the Hospital
wants financed under the Flexible Pay system. Upon receiving a Financing
Request, IFS shall, subject to Hospital’s compliance with Article III, wire
transfer the Net Proceeds to the designated bank account of Hospital on the
applicable Settlement Date.

(3)      Advance Amount. As consideration for the transfer of a Hospital Bill
to IFS, IFS shall pay to Hospital:

 (a) on the next applicable Settlement Date, an amount equal to the
Net Proceeds; and

 (b) on the next applicable Settlement Date, an amount equal to the
Additional Advance Amount, if any, with respect to amounts collected up to
the Friday immediately preceding such Settlement Date.

IFS shall have the right to offset amounts payable to Hospital against
amounts owed by Hospital to IFS.

(4)      Confirmation. Upon payment to Hospital of the Net Proceeds, Hospital
shall be deemed to have granted, transferred and assigned the relevant Hospital
Bills to IFS, at which time ownership thereto shall pass to IFS. Upon funding
of the Advance Amount, IFS shall deliver to Hospital an Advance Confirmation on
its standard form. As consideration for the assignment of a Hospital Bill to
IFS, the Hospital will pay IFS the Transaction Fee.

ARTICLE IV

RESPONSIBILITIES OF HOSPITAL

(1)      Credit Approval; Documentation. Hospital shall have the sole right and
responsibility to accept or reject a patient’s use of the Program. All Hospital
Bills submitted to IFS for financing shall satisfy the Account Criteria and
shall be subject to the terms of this Agreement. Unless agreed to in writing by
IFS, I-hospital shall only allow payment pursuant to the Program from a
Responsible Party who has executed a Revolving Credit Agreement. With respect
to each Responsible Party seeking to utilize the Program who has not previously
executed and delivered a Revolving Credit

4

 

Agreement, Hospital shall obtain from such Responsible Party a signed copy
of such agreement before authorizing payment of the Hospital Bill through the
Program and shall deliver a completed copy of such agreement to the Responsible
Party. Hospital shall certify on the Financing Request that each Responsible
Party listed on the Form has signed and received a copy of the Revolving Credit
Agreement prior to or at the time the Responsible Party is enrolled in the
Program. Evidence of the Responsible Party’s agreement to the terms of the
Revolving Credit Agreement shall be submitted to IFS upon request. The
presentation by the Responsible Party to Hospital of a Valid Hospital Revolving
Credit Card shall be conclusive evidence that he or she has previously executed
a Revolving Credit Agreement.

(2)      Billing and Collection. For all Accounts financed by IFS, all payments
by Responsible Parties shall be made as directed by IFS. IFS shall have the
right to modify or extend the terms of any and all Accounts it finances under
this Agreement. Except as provided in Article VII, Hospital shall not negotiate
with or collect any amounts in regard to the Accounts financed by IFS
hereunder. In the event Hospital receives any payment due on an Account
financed by IFS, Hospital shall immediately forward it to IFS. Prior to the
purchase of an Account by Hospital pursuant to a Purchase Event or Termination
Event, IFS shall have the right to demand and collect all amounts due under
such Account.

(3)      Compliance with Applicable Law. Hospital shall submit to IFS only
Hospital Bills that arise from goods and services actually provided by Hospital
to the patient and for which Hospital may submit a bill under applicable laws
and regulations.

(4)      No Surcharges or Fees. Hospital shall not assess to the patient or any
Responsible Party a surcharge or any other extra fee or charge on any Hospital
Bill submitted to IFS for financing.

(5)      Access to Information. Throughout the term of this Agreement, Hospital
shall promptly furnish to IFS all non-clinical patient information reasonably
requested by IFS. Upon reasonable notice, IFS and its representatives shall
have the right to audit Hospital records during business hours with respect to
the Accounts.

ARTICLE V

HOSPITAL’S UNCONDITIONAL OBLIGATION TO PURCHASE ACCOUNTS

(1)      Purchase By Hospital. Hospital hereby unconditionally and irrevocably
agrees to purchase each Account as to which a Purchase Event has occurred
(each, a “Purchase Account”). If a Purchase Event occurs, IFS shall submit a
Purchase Notice to Hospital on or before the Friday immediately preceding the
next applicable Settlement Date. Hospital shall wire transfer the Purchase
Price for such Purchase Accounts on such Settlement Date to the designated bank
account of IFS. Upon payment of the Purchase Price, ownership of the applicable
Purchase Accounts shall pass to Hospital free of any claim of IFS or a
Financial Institution.

(2)      Unconditional Obligation. Hospital’s obligation to purchase an Account
and to pay IFS or any Financial Institution therefore is continuing, absolute
and unconditional and without right of setoff; is irrespective of the value,
validity or enforceability of a Revolving Credit Agreement, Hospital Bill or
Account; and is irrespective of act, omission, bankruptcy, failure to perform,
failure to service, or other default on the part of IFS. Hospital hereby waives
and agrees not to assert any defenses it may have, under suretyship law or
otherwise, to its obligation to purchase an Account including, without
limitation: any defense related to fraud or misrepresentation; any amendment,
modification, supplement or extension of the time of payment with respect to a
Hospital Bill or Revolving Credit Agreement; the exercise, non-exercise or
delay in exercising any right, remedy,

5

 

power or privilege under a Revolving Credit Agreement; any right to
require presentment, protest, demand or notice of any kind; and any defense
arising out of the bankruptcy, death or incompetency of a Responsible Party or
other obligor. Hospital waives and agrees never to assert any defenses of a
Responsible Party or other obligor to avoid, reduce, limit or negate in any way
Hospital’s obligation to purchase the Account.

(3)      Purchase of All Accounts. Upon a Termination Event, Hospital
unconditionally and irrevocably agrees, in accordance with subsection (2),
above, to purchase all Accounts financed by IFS under this Agreement. In such
event, IFS or any Financial Institution to which IFS has assigned an interest
in this Agreement shall transmit a completed Termination Notice to Hospital and
Hospital shall have thirty (30) days after receipt of the Termination Notice to
wire transfer the Purchase Price to the designated bank account of IFS for all
of the Accounts shown on the Termination Notice.

(4)      Refund of Service Fee. Upon the purchase of an Account by Hospital
pursuant to this Article IV, Hospital shall be entitled to a refund in an
amount equal to the unearned portion of the Service Fee that was paid by
Hospital in connection with the financing of the Account by IFS. For purposes
of this subsection (4), a Service Fee shall be treated as “unearned” in the
same proportion as the ratio of (i) the unpaid balance of the Account to (ii)
the original principal balance of the Account when financed by IFS. Any Service
Fee refund with respect to an Account shall be paid by deducting the refund
amount from the Purchase Price of the Account. Notwithstanding the foregoing,
Hospital shall not be entitled to any refund with respect to an Account if the
purchase of the Account results from (A) a termination of this Agreement by
Hospital pursuant to Article IX hereof, or (B) a termination of this Agreement
resulting from a Default by Hospital pursuant to Article X hereof.

ARTICLE VI

REPRESENTATIONS AND WARRANTIES OF HOSPITAL

The following representations and warranties of Hospital shall be true and
correct as of the date hereof and throughout the term of this Agreement:

(1)      Corporate Organization; Authority. Hospital is a                           duly
organized, solvent, validly existing and in good standing under the laws of
                                      . Hospital has all necessary                                power and authority to
enter into and execute this Agreement and to perform and consummate the
transactions contemplated hereby. This Agreement is a legally enforceable,
valid and binding obligation of Hospital. The execution and delivery of this
Agreement does not and will not conflict with or violate the articles of
incorporation or bylaws of Hospital nor will it result in violation of any law,
ordinance, regulation, court order or decree, or the terms of any other
contract, agreement or financing covenant applicable to Hospital.

(2)     
Account Compliance. All Accounts submitted to IFS for financing
shall arise from goods and services actually provided by Hospital to the
patient and for which Hospital may submit a bill under applicable laws and
regulations. All Hospital Bills submitted to IFS hereunder have been and shall
be originated in compliance with all applicable laws and regulations, duly
executed by the parties thereto, valid and enforceable in accordance with their
terms and free from all liens, encumbrances or rights of offset or
counterclaim. Each Hospital Bill satisfies all of the Account Criteria set
forth on Exhibit B and is in an unpaid amount equal to or in excess of the
amount set forth on the related Advance Request. Each request for financing
shall be evidenced by a complete and accurate Hospital Bill executed by the
Responsible Party and assigned to IFS. Hospital shall have obtained from the
Responsible Party an executed Revolving Credit Agreement at or prior to the
first Hospital Bill assigned to IFS hereunder.

6

 

(3)      Consent and Approvals. No consent of any entity or person is required
in connection

with the execution and delivery of this Agreement by Hospital or for the
performance consummation of the transactions contemplated herein. Each
Financing Request hereunder shall be deemed a restatement of Hospital’s
representations and warranties hereunder.

(4)      Financial Statements. Hospital has delivered to IFS copies of
Hospital’s audited, consolidated financial statements for the most recent
fiscal year and unaudited consolidated financial statements for the most recent
fiscal quarter, all of which are complete, correct and accurate in all material
respects as of their respective dates. Within forty-five (45) days after the
end of each of its fiscal quarters, Hospital shall deliver to IFS a copy of its
unaudited financial statements for such quarter. Within ninety (90) days after
the end of each of its fiscal years, Hospital shall deliver to IFS a copy of
its audited, consolidated and consolidating financial statements. All such
financial statements are or shall be correct and complete and present fairly
the financial position of Hospital and the results of operations for Hospital.
All such financial statements shall have been prepared in accordance with
generally accepted accounting principles consistently maintained and applied
throughout the periods indicated.

ARTICLE VII

REPRESENTATIONS AND WARRANTIES OF IFS

The following representation and warranties of IFS shall be true and
correct as of the date hereof and throughout the term of this Agreement:

(1)      Corporate Organization; Authority. IFS is a corporation duly
organized, solvent, validly existing and in good standing under the laws of the
State of Colorado. IFS has all necessary corporate power and authority to enter
into and execute this Agreement and to consummate the transactions contemplated
hereby. This Agreement is a legally enforceable, valid and binding obligation
of IFS. The execution and delivery of this Agreement does not and shall not
conflict with or violate the articles of incorporation or bylaws of IFS.

(2)      Consents and Approvals. No consent of any entity or person is required
in connection with the execution and delivery of this Agreement by IFS or for
the consummation of the transactions contemplated herein, including, without
limitation, consents from parties to loans, contracts, leases or other
agreements to which IFS is a party.

ARTICLE VIII

SERVICING

(1)      Servicing. IFS shall use commercially reasonable efforts to collect
each Account. IFS shall service the Accounts in accordance with good industry
standards and the Servicing Procedures. IFS shall (i) comply with all
applicable federal, state and local laws and regulations and (ii) maintain all
necessary state and federal licenses.

(2)      Application of Payments. IFS shall apply all payments received from
the Responsible Party with respect to an Account in the following order of
priority: (i) to any unpaid fees and late charges due and owing with respect to
such Account, (ii) to accrued and unpaid interest, and (iii) to the outstanding
principal balance of the Account. All interest, fees, late charges, and other
amounts paid under the Accounts during the term of IFS’ ownership shall be the
sole property of IFS and fully earned upon receipt.

7

 

(3)      Account Status Report. On each Settlement Date, IFS shall provide an
Account status report to Hospital. The report will summarize the status of each
account as of the previous Friday.

(4)      Compromise. IFS shall endeavor to settle, compromise or adjust any
Account in accordance with the written request of Hospital. IFS shall retain,
as fully earned, the Service Fee on the amount of such adjustment, compromise
or reduction. IFS may not settle, compromise or adjust any Account without the
prior approval of Hospital.

(5)      Access to Information. Throughout the term of this Agreement, IFS
shall provide to Hospital such information regarding the Accounts as Hospital
may reasonably request. Upon reasonable notice, Hospital and its
representatives shall have the right to audit IFS records with respect to
Accounts during business hours.

(6)      Set-Up and Installation Fee. Hospital shall pay to IFS a Set-Up and
Installation Fee in the amount set forth in Exhibit A in consideration for IFS’
initial implementation of the Flexible Pay system. Such fee shall be fully
earned and non-refundable upon payment.

ARTICLE IX

SECURITY INTEREST

Hospital hereby grants and pledges to IFS a first priority security
interest in the Accounts and all payments and proceeds thereof as security for
the performance by Hospital of its obligations hereunder, and agrees not to
create or suffer to exist any lien or security interest of any party other than
IFS in any such Accounts. In this regard, IFS shall be authorized to take such
action as it deems necessary to perfect the foregoing security interest
including, without limitation, the filing of a financing statement with respect
to the Accounts. In the event of a default hereunder, IFS shall have all rights
and remedies granted to a secured party under the Colorado Uniform Commercial
Code.

ARTICLE

TERMINATION

Either party or any Financial Institution to which IFS has assigned an
interest in this Agreement shall have the right to terminate this Agreement
upon thirty (30) days prior written notice to the other party and any such
Financial Institution. Upon such notice of termination, IFS shall have no
further obligation to finance Accounts. Hospital shall be obligated to purchase
all of the Accounts following receipt of a Termination Notice as provided in
Article IV.

ARTICLE XI

DEFAULT

(1)      Event of Default. The following events shall constitute a default (a
“Default”) under the terms of this Agreement: (a) the failure to pay or perform
any obligation, covenant or liability in connection with this Agreement within
ten (10) days after the date that written notice thereof is given by one party
to the other; (b) any warranty, representation or statement whenever made in
connection with this Agreement proves to be false in any material respect when
made or becomes untrue in any material respect; (c) dissolution of either
party; (d) insolvency of either party; (e) the assignment for the general
benefit of a party’s creditors, the appointment of a receiver or trustee for
the assets of a party, the commencement by or against a party of any proceeding
under any bankruptcy or insolvency laws or for the dissolution or liquidation,
settlement of claims against or winding up of its affairs; (f) the termination
or withdrawal of any guarantee for Hospital’s

8

 

obligations; (g) default by Hospital on any bonds or other material
indebtedness of any kind; (h) Hospital’s bond rating falls below investment
grade; (i) Hospital’s loss of Medicare or Medicaid provider number; (j) a party
discontinues its business as a going concern; or (k) IFS, in good faith, deems
the prospects of Hospital’s payment or the performance of its obligation to
have been jeopardized.

(2)      Effect of Default. Upon the occurrence of any Default, in addition to
any rights either party has under this Agreement or applicable law, the
nondefaulting party may immediately declare a Termination Event and terminate
this Agreement by delivering a Termination Notice, at which time IFS shall have
no further obligation to finance Accounts, all obligations of either party to
the other shall immediately become due and payable without further notice, and
Hospital shall be obligated to purchase all of the Accounts in accordance with
Article IV hereof.

(3)      Late Charge. In addition to the payment of the Purchase Price,
Hospital shall pay a late charge to IFS at the rate of one and one-half percent
(1-1/2%) per month on any amounts Hospital owes to IFS which are not paid when
due.

ARTICLE XII

Hospital agrees to defend, indemnify and hold IFS, its agents and
employees harmless from and against any and all claims, counterclaims,
liabilities, losses, damages, court costs, attorneys’ fees and other expenses
arising from the origination of any Account financed hereunder and the
collection activities performed by Hospital, its agents or employees with
respect to any Accounts. IFS agrees to defend, indemnify and hold Hospital, and
its agents and employees harmless from and against any and all claims,
counterclaims, liabilities, losses, damages, court costs, attorneys’ fees and
other expenses arising out of the failure of IFS to collect Accounts in
conformity with applicable laws and regulations.

ARTICLE XIII

NON-SOLICITATION

During the term of this Agreement and for one (1) year after the date of
termination of this Agreement (the “Restrictive Period”) Hospital shall not
directly or indirectly attempt to solicit or conduct business with any person
or entity that is a client, customer or active prospect of IFS at the time of
termination of this Agreement for the purpose of providing services that are
competitive with the services provided by IFS under this Agreement. The terms
“client,” “customer” and “active prospect” include, but are not limited to, any
person or entity solicited or contacted by IFS or any person or entity to which
services have been rendered by IFS directly or indirectly during the two (2)
years preceding termination. Hospital acknowledges its duty, both by contract
and common law, neither to interfere with contractual relationships nor to use
proprietary and confidential information about customers or clients of IFS for
the advantage of any person or entity other than IFS.

The covenants of Hospital contained in this Article XII shall be
independent of any other provision in this Agreement; and the existence of any
claim or cause of action by Hospital against IFS shall not constitute a defense
to the enforcement by IFS of such covenants. Hospital understands that the
covenants contained in this Article XII are essential elements of this
Agreement, in the absence of which IFS would not have agreed to disclose
confidential information and provide access to key employees and contractors as
contemplated herein. Hospital further agrees and acknowledges that this
Agreement (i) is reasonable as to length of time, scope and geographic area for
purposes of protecting the commercial advantages enjoyed by IFS, (ii) does not
impose a greater restraint than is necessary to protect the goodwill or
business interests of IFS and (iii) is adequately paid for by the consideration
to Hospital under this Agreement. Hospital and IFS also agree that a court
shall have

9

 

authority to modify any provision of this covenant in accordance with the
court’s determination as to reasonableness or scope of application and,
consistent with this Article XII, this Agreement shall remain enforceable as
modified or amended in the jurisdiction where this Agreement is so modified or
amended.

ARTICLE XIV

NONDISCLOSURE OF PROPRIETARY CONFIDENTIAL INFORMATION

Each party acknowledges that, during the term of this Agreement, a party
may obtain special training and shall have access to and become familiar with
various trade secrets and confidential information of the other party
including, but not limited to, the terms of this Agreement, methods of
operation, techniques, designs, processes, technologies, compilations of
information, past, present and prospective customer lists, and records and
specifications that are owned by and commercially beneficial to a party,
including any compilation of various trade secrets or data derived from such
information (collectively, the “Proprietary Information”). The Proprietary
Information does not include information that is or becomes part of the public
domain. If a party is required by law to disclose Proprietary Information, the
disclosing party shall notify the non-disclosing party, in writing, of the
nature of such disclosure and the Proprietary Information to be disclosed, as
soon as is possible and/or practical, to permit the nondisclosing party the
opportunity to contest or limit such disclosure.

Each party agrees that it shall not disclose to any person or entity,
either during the term of this Agreement or after termination of this Agreement
for any reason, any Proprietary Information of the other party, except as may
be necessary for the enforcement of this Agreement. Similarly, a party shall
not use such information for the benefit of any person or entity other than the
disclosing party at any time. Notwithstanding the foregoing, the parties agree
that disclosure of Proprietary Information to a Financial Institution pursuant
to IFS’ obligations to such Financial Institution shall be permitted. Each
party acknowledges that this covenant of nondisclosure is an integral term of
this Agreement and is given in consideration of the other party’s performance
of this Agreement.

ARTICLE X V

MISCELLANEOUS

(1)      Attorneys Fees; Miscellaneous. In the event of litigation to enforce
this Agreement, the prevailing party shall be awarded its reasonable attorneys
fees, costs and expenses. No delay or failure on the part of either party in
exercising any right, privilege, or option hereunder shall operate as a waiver
of such or of any other right, privilege, or option. No waiver, amendment or
modification of any provision of this Agreement shall be valid unless in
writing signed by IFS and Hospital and then only to the extent therein stated.
The headings herein are for convenience only, and shall not define or limit the
scope, extent, meaning or intent to this Agreement. This Agreement and its
Exhibits embody the entire agreement between IFS and Hospital as to the subject
matter hereof.

(2)      Notice; Wire Transfers. All notices hereunder shall be in writing and
shall be given by personal delivery, certified mail, return receipt requested,
facsimile or nationally recognized overnight courier service to the address
shown on the signature page. Notices shall be deemed given when received. All
transfers of funds hereunder shall be by wire transfer to the accounts
identified on the signature page.

(3)      Assignability. This Agreement is not assignable by Hospital without
the prior written consent of IFS. IFS may assign this Agreement or the
administration or servicing hereof without the prior consent of Hospital. IFS
is expressly authorized to assign this Agreement and any Accounts

10

 

subject to this Agreement to an affiliate of IFS or to a Financial
Institution, which assignee shall inure to the benefits provided to IFS under
this Agreement and such Accounts and who shall be a third party beneficiary
under this Agreement with respect to such Accounts.

(4)      Severability. If any part of this Agreement shall be held to be
invalid, illegal or unenforceable, the validity, legality or enforceability of
the remainder of the Agreement shall not in any way be affected or impaired
thereby.

(5)      Injunctive Relief. Hospital agrees that a breach or threatened breach,
based on reasonable and good faith evidence of a breach on Hospital’s part, of
any covenant contained in Articles XI or XII shall cause irreparable damage to
IFS. For that reason, Hospital further agrees that IFS shall be entitled to an
injunction from any court of competent jurisdiction, restraining any further
violation of any of such covenants by Hospital, Hospital’s future contract
partners, contractors; business partners, agents or any person or entity
related, directly or indirectly, to Hospital. Such right is in addition to all
other remedies IFS may have under this Agreement, at law or otherwise.

(6)      Survival. The terms and provisions of Articles IV, XI, XII, XIII and
XIV shall survive any termination of this Agreement.

(7)      Applicable Law; Consent to Jurisdiction. This Agreement shall be
governed by, construed and enforced according to the laws of the State of
Colorado without giving consideration to any Colorado rule of law that would
apply the law of another state. The parties agree that any legal action or
other proceeding relating to this Agreement or the enforcement of any provision
of this Agreement shall be brought in any state court located in Arapahoe
County, Colorado or any federal court located in the City and County of Denver,
Colorado. Each party irrevocably consents and submits to the jurisdiction of
such courts in connection with any such legal proceeding and agrees not to
assert that the venue of any such proceeding is improper.

[Signatures on following page]

IN WITNESS WHEREOF, Hospital and IFS have caused this Agreement to be
executed by their authorized officers, on the date first above written.

	 	 	 
	INTEGRATED FINANCIAL SYSTEMS, INC.
	 	 
	

	 	 
	 
	 	 
	By:

	 	By:
	 

	 	 
	John Herbers
	 	 
	 
	 	 
	Address:

	 	Address:
	 
	 	 
	7807 E. Peakview Avenue, Suite 300
Greenwood Village, CO 80111
	 	 
	 
	 	 
	Attn: Chief Executive Officer

	 	Attn:
	Telephone: (303) 290-0700

	 	Telephone: (                    )
	Facsimile: (303) 290-0458

	 	Facsimile: (                    )
	Email: jherbers @medflexpay.com

	 	Email:
	Wire Instructions

	 	Wire Instructions

11

 

EXHIBIT A

FINANCIAL ADDENDUM

	 	 	 	 	 
	Advance Rate

	 	 	 	%
	Transaction Fee

	 	 	 	% of the principal amount of the Account
	Service Fee

	 	-
	 	% of the principal amount of the Account
	Software Fee

	 	 	 	% of the principal amount of the Account
	Purchase Interest Rate

	 	-
	 	% per annum
	Set-Up and Installation Fee

	 	-
	 	$-0-

Example 1: Purchase of Account (no principal payment)

	 	 	 	 	 
	Face Amount of Account
	 	$	1,000.00	 
	Advance Rate
	 	 	80	%
	Advance Rate Amount
	 	 	800.00	 
	Less: Transaction Fee
	 	 	(.00	)
	Service Fee
	 	 	(.00	)
	Software Fee
	 	 	(.00	)
	Net Proceeds Paid to Hospital
	 	 		 
	Unpaid Principal Balance at Default
	 	 		 
	Plus: Purchase Interest* (assuming 90 days)
	 	 		 
	Less: Service Fee Credit
	 	 		
	 
	 	 	 	 
	Repurchase Price
	 	$		 

* 8% per annum, 360 day year

Example 2: Purchase of Account ($500 principal payment)

	 	 	 	 	 
	Face Amount of Account
	 	$	1000.00	 
	Advance Rate
	 	 	80	%
	Advance Rate Amount
	 	 	800.00	 
	Less: Transaction Fee
	 	 	(.00	)
	Service Fee
	 	 	(.00	)
	Software Fee
	 	 	(.00	)
	Net Proceeds Paid to Hospital
	 	 		 
	Principal Payments
	 	 	(500.00	)
	 
	 	 	 	 
	Unpaid Principal Balance at Default
	 	 	500.00	 
	Plus: Purchase Interest’s
(assuming 90 days)
	 	 	50.00	 
	Less: Service Fee Credit
	 	 		
	 
	 	 	 	 
	RePurchase Price
	 	$		 

8% per annum, 360 day year

12

 

EXHIBIT B

ACCOUNT CRITERIA

With respect to any Account, “Account Criteria” means that the following
conditions are satisfied with respect to such Account and that the Hospital is
in possession of a fully completed Revolving Credit Agreement and Hospital Bill
executed by the Responsible Party with respect to each Account.

(l)      The Account satisfies the following conditions:

(a) the Responsible Party has not claimed any offset, disputed the
Account, asserted any claim against the Hospital, asserted any defense to
payment of the obligation, retained legal counsel with respect to the Account,
threatened or initiated legal action against IFS or the Hospital;

(b) the Account has been earned by the final delivery of goods or the
rendition of services by the Hospital;

(c) the Responsible Party (i) has a permanent address in the United
States, (ii) is not deceased, and (iii) has provided to the Hospital up-to-date
and accurate contact and billing information;

(d) the Account is owed by a Responsible Party who is solvent and not the
subject of any bankruptcy proceedings;

(e) the Account is not subject to any lien, security interest or claim in
favor of any person or entity other than IFS;

(f) the Account has not been extended, restructured, amended or modified;

(g) no fraud has occurred with respect to the Account;

(h) the Account was originated not more than 60 days prior to the date of
Service.

13

 

EXHIBIT C

FORM OF FINANCING REQUEST

                                   -           , 20     

          Integrated Financial Systems, Inc.

          7807 East Peakview Avenue, 3rd Floor

          Englewood, Colorado 80111

	 	Re:	 	Patient Account Agreement, dated as of                      ,
20      (the “Agreement”), by and between Integrated Financial
Systems, Inc. (“IFS”) and                                     (the “Hospital”)

Ladies and Gentlemen:

Pursuant to Article II of the Agreement, the Hospital hereby requests that
IFS finance the Accounts listed on Schedule 1 to this Financing Request (the
“Scheduled Accounts”).

The Hospital hereby certifies to IFS that: (i) the representations and
warranties of the Hospital set forth in the Agreement are true and correct as
of the date hereof, and (ii) each Scheduled Account satisfies the Account
Criteria as set forth in Exhibit B to the Agreement.

	 
	Very truly yours,

	 

	 

	 

	By:

	 

	Name:

	 

	Its:

	 

14

 

EXHIBIT D

FORM OF ACCOUNT RETURN NOTICE

                                         , 20     

[HOSPITAL]

	 	Re:	 	Patient Account Agreement, dated as of February
                               , 20      (the “Agreement”), by and between
Integrated Financial Systems, Inc. (“IFS”) and
                                                 (the “Hospital”)

Ladies and Gentlemen:

Pursuant to Article IV of the Agreement, IFS hereby gives notice that a
Return Event has occurred with respect to the Accounts listed on Schedule 1.

	 
	Very truly yours,

	 

	INTEGRATED FINANCIAL SYSTEMS, INC.

	 

	By:

	 

	Name:

	 

	Its:

	 

15

 

EXHIBIT E

SERVICING PROCEDURES

This Exhibit E sets forth the “Servicing Procedures” applicable to the
Patient Account
Agreement, dated as of                                , 20      (the “Agreement”), by and between
Integrated Financial Systems, Inc. (“MS”) and                                                       (the
“Hospital”). The provisions set forth herein are in addition to the provisions
relating to servicing set forth in the Agreement and are not intended to alter
or amend the terms and conditions of the Agreement. Capitalized terms not
defined herein shall have the same meanings given those terms in the Agreement.

(1)      IFS shall proceed diligently to collect all payments called for under
the terms and provisions of the Accounts.

(2)      IFS shall service and administer the Accounts in accordance with the
terms of the Agreement

(3)      Subject to the Agreement and the Servicing Procedures set forth
herein, IFS shall have full power and authority to do or cause to be done any
and all things in connection with the servicing and administration of the
Accounts as IFS deems necessary or desirable.

(4)      IFS shall service and administer the Accounts in accordance with
applicable state and federal law and shall maintain all necessary state and
federal licenses.

(5)      The Hospital shall furnish to IFS such powers of attorney and other
documents necessary or appropriate to enable IFS to carry out its
administrative and servicing duties hereunder and under the Agreement.

(6)      Following the occurrence of a default or event of default with respect
to an Account, if IFS determines that a negotiated settlement, compromise or
adjustment in the amount owed by the Responsible Party is reasonably likely to
produce a greater recovery of such Account, IFS shall so advise the Hospital.
IFS may not settle, compromise or adjust an Account without the prior written
approval of Hospital.

(7)      IFS will maintain the Hospital’s access to the automated Flexible
PayTM system with telephonic support Monday through Friday from 8:00 AM to 5:00
PM, and email support for all hours and days not specified.

(8)      IFS will design and implement for the benefit of the Hospital a
Revolving Credit Card program following the Hospital’s final acceptance of the
Revolving Credit Card program design.

(9)      IFS will assign a named account executive who will be onsite to serve
the Hospital’s needs once per month, or more or less frequently as requested by
the Hospital.

(10)      IFS will provide benchmark, performance and other management reports
to designated Hospital executives and managers at such times and in such manner
as may be agreed upon from time to time.

16

 

EXHIBIT F-1

FORM OF TERMINATION NOTICE

                               , 20     

[HOSPITAL]

                                                         

                                                         

                                                         

	 	Re:	 	Patient Account Agreement, dated as of                                , 20      (the
“Agreement”), by and between Integrated Financial Systems, Inc.
(“IFS”) and
                                                      (the “Hospital”)

Ladies and Gentlemen:

Pursuant to subsection (3) of Article IV of the Agreement, IFS hereby
notifies the Hospital that a Termination Event has occurred under the Agreement
and, accordingly, IFS hereby demands that the Hospital purchase all of the
Accounts under the Agreement owned by IFS, which Accounts are listed on
Schedule I to this Return Notice (the “Termination Accounts”). The applicable
Termination Event is as follows:

	 	o	 	IFS or any Financial Institution to which IFS has
assigned an interest in the Agreement has given Hospital
thirty (30) days written notice of its election to terminate
the Agreement in accordance with Article IX of the Agreement;
or

	 
	 	o	 	a default by Hospital has occurred under Article X of the
Agreement and any applicable notice and cure periods set forth
therein have expired.

In accordance with Article VIII of this Agreement, as of the date of this
Termination Notice, IFS assigns all Accounts to Hospital. IFS shall have no
further obligation or commitment to finance Accounts under the Agreement and
Hospital shall be solely responsible for processing billing, collecting and
terminating such Accounts.

Very truly yours,

17

 

EXHIBIT F-2

FORM OF TERMINATION NOTICE

                                                 , 20     

Integrated Financial Systems, Inc.

7807 East Peakview Avenue, 3rd Floor

Englewood, CO 80111

	 	Re:	 	Patient Account Agreement, dated as of                                               , 20       (the
“Agreement”), by and between Integrated Financial Systems, Inc.
(“IFS”) and                                                  (the “Hospital”)

Ladies and Gentlemen:

Pursuant to subsection (3) of Article IV of the Agreement, Hospital hereby
notifies IFS that a Termination Event has occurred under the Agreement and,
accordingly, Hospital hereby demands that IFS assign all of the Accounts under
the Agreement owned by IFS, which Accounts are listed on Schedule I to this
Return Notice (the “Termination Accounts”). The applicable Termination Event is
as follows:

	 	o	 	Hospital has given IFS and any Financial Institution to which
IFS has assigned an interest in the Agreement thirty (30) days
written notice of its election to terminate the Agreement in
accordance with Article IX of the Agreement; or

	 
	 	o	 	a default by IFS has occurred under Article X of the Agreement and
any applicable notice and cure periods set forth therein have
expired.

In accordance with Article VIII of this Agreement, as of the date of this
Termination Notice, IFS assigns all Accounts to Hospital. IFS shall have no
further obligation or commitment to finance Accounts under the Agreement and
Hospital shall be solely responsible for processing billing, collecting and
terminating such Accounts.

Very truly yours,

18

 

EXHIBIT G

FORM OF NOTICE OF ASSIGNMENT

TO FINANCIAL INSTITUTION

                                                      , 20     

[HOSPITAL]

	 	Re:	 	Patient Account Purchase Agreement, dated as of
                                         , 20      (the “Agreement”), by and between
Integrated Financial Systems, Inc. (“IFS”) and
                                                      (the “Hospital”)

Ladies and Gentlemen:

Be advised that IFS has assigned its interest in the Agreement to
[Financial Institution]. In this regard, [Financial Institution] is a third
party beneficiary of the Agreement pursuant to subsection (3) of Article XIV of
the Agreement.

Additionally, all funds to be paid by the Hospital to IFS pursuant to the
Agreement shall be wired transferred to:

[Financial Institution]

ABA No. Account No.                                                           

for the account of Integrated Financial Systems, Inc.

	 
	Very truly yours,

	 

	INTEGRATED FINANCIAL SYSTEMS, INC.

	 

	By:

	 

	Name:

	 

	Its:

	 

ACKNOWLEDGED AND AGREED TO:

[HOSPITAL]

By:

Name:

Its:

19

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